COVID hits profit of commercial banks
Kathmandu, August 23
The profit made by commercial banks in the country dropped by a whopping Rs 8.68 billion in fiscal year 2019-20.
According to the unaudited financial statements of the banks, the 27 commercial banks of the country earned a profit of Rs 54.31 billion in fiscal 2019-20 against a profit of Rs 63 billion posted in the previous fiscal year 2018-19.
Commercial banks have witnessed a drop in their profits due the severe impact of the COVID-19 on the economy.
Even though banks have been providing their services during the lockdown financial transactions have plummeted like never before.
While no new business was established during this period, the already existing businesses also failed to pay their loans and interests due to which the banks failed to either disburse new loans or recover existing loans and interests.
The non-performing loan of banks thus increased to 1.73 per cent in fiscal 2019- 20 as compared to 1.44 per cent in the fiscal year 2018-19.
During the review period, Rastriya Banijya Bank grossed the highest profit of Rs 4.45 billion. In second place was Nabil Bank with a profit of Rs 3.56 billion.
Likewise, Global IME Bank Bank was able to earn Rs 3.8 billion while NIC Asia Bank raked in a profit of Rs 3.12 billion in fiscal 2019-20.
Meanwhile, Nepal Investment Bank, Nepal Bank, Himalayan Bank, Agricultural Development Bank, Everest Bank, Prime Commercial Bank, NMB Bank and Siddhartha Bank were able to earn profit of above Rs two billion.
Similarly, banks that earned a profit of more than Rs one billion are Standard Chartered Bank Nepal, Sanima Bank, Bank of Kathmandu, Nepal SBI Bank, Mega Bank, Laxmi Bank, Sunrise Bank, Prabhu Bank, Machhapuchchhre Bank, Nepal Bangladesh Bank, Kumari Bank, NCC Bank and Citizens Bank.
Meanwhile, Century Commercial Bank and Civil Bank were able to earn profit of less than Rs one billion.
A version of this article appears in e-paper on August 24, 2020, of The Himalayan Times.