Despite huge impairment charge of Rs 1.12 arba, NIC Asia Bank able to increase net profit by a meager margin in Q4; Deposits from customers exceed Rs 2 kharba

NIC Asia Bank Limited (NICA) has published its fourth-quarter report for the FY 2076/2077 with a meager rise in Net Profit by 3.25%. The bank’s net profit has increased from Rs. 3.02 Arba in the fourth quarter of the FY 2075/2076 to Rs. 3.12 Arba in the fourth quarter of FY 2076/2077. The decline in net profit is mainly due to the high impairment charge (provision) for loans and other losses of Rs 1.12 arba.

The company’s operating profit has decreased by 1.02% to Rs. 4.46 Arba in the fourth quarter in FY 2076/2077 compared to the corresponding quarter of the previous year. The bank has Rs. 1.44 arba as a Distributable profit after P/L appropriation and regulatory requirements in the fourth quarter. This means NICA can distribute around 14% (approx.) dividends from the earnings of FY 2076/77 if other regulatory requirements are not required. However, as per NRB circular, the interest amount which cannot be recovered in Q4 of 2076/77 can be shown in this year's balance sheet if it is recovered till Q1 of FY 2077/78. So the distributable amount might be slightly changed.

The bank’s deposit from customers increased by 17.62% to Rs. 2.01 kharba whereas loans and advances to customers increased by 12.35% to Rs. 1.60 kharba till the fourth quarter. The net interest income (Core business income) of the bank has increased by 9.26% to Rs. 7.60 Arba compared to the corresponding quarter of the previous year.

The bank’s paid-up capital stands at Rs. 9.71 Arba with Rs. 7.51 Arba as its reserves and surplus. The Non-performing loan (NPL) slightly increased to 0.75% from 0.46% in the corresponding quarter.

The EPS of the bank in the fourth quarter of FY 2076/2077 stood at Rs. 32.13. The Net worth per share stands at Rs. 177.36 and Qtr End PE ratio stands at 17.22 times.

Click here for Q4 report:

Major Highlights: