ICRA gives Nepal Investment Bank Ltd. (A) tag

KATHMANDU, FEB 19: 

Nepal Investment Bank Ltd (NIBL) has retained the rating of (Nepal) A from the Indian Credit Rating Agency (ICRA), an associate of Moody’s Investors Service.

The rating for issuers in Nepal is assigned on a scale, which ranges from (Nepal) AAA to (Nepal) D, according to the bank. The rating of NIBL factors in the bank’s good market position in Nepal, adequate earning profile, and its experienced management team, it said, adding that the real estate portfolio has been mitigated by adequate security coverage norms of the bank.

ICRA has also noted with concern the tight liquidity condition in Nepal, though the liquidity profile has improved over the last few months. NIBL’s comfortable liquidity profile even during the tight liquidity conditions indicate strength, according to ICRA.

The bank — one of the largest private sector banks in Nepal — has been able to maintain a comfortable profitability profile largely led by adequate net interest margins and control on credit provisions as its capitalisation levels are adequate (CRAR of 11.11 per cent as on mid-Jan-2012). 

“It had lower credit growth in 2010-11 and intends to maintain a lower growth in the short to medium term,” added the bank that has 41 branches and 67 ATMs.

As of mid-July 2011, NIBL had a market share of about seven per cent in terms of deposit base and total advances of the banking system in Nepal.

It reported a net profit of Rs 1.17 billion in fiscal year 2010-11 over an asset base of Rs 57.36 billion as of mid-July 2011, compared to a net profit of Rs 1.26 billion over an asset base of Rs 58.3 billion as of mid-July 2010.

Source: THT