Prime Bank’s profit growth stemmed by provision of Rs 17.9 crore in Q3

ShareSansar, May 12:

Prime Commercial Bank Limited has reported a slight profit rise of 9.20 percent in the third quarter of the current fiscal year 2070/71, according to the unaudited financial report it has published today.

Prime Bank has stated that its net profit has increased to Rs 42.37 crore, up from Rs 38.80 crore in the corresponding quarter of the last fiscal year 2069/70.

It may be noted here that like in the second quarter, the net profit was basically propelled by Prime’s profit from operational profit, especially write back of Rs 11.80 crore  it had earlier provisioned for possible losses.

However, its net interest income in the third quarter has actually dropped to Rs 73.24 crore down from Rs 76.01 crore in the corresponding quarter—due to high interest expense .

It has also provisioned Rs 17.90 crore for the possible losses, which has largely stemmed the profit growth.

Prime mobilized Rs 30.15 arba in deposit and Rs 25.38 arba in loan as compared to Rs 25.66 arba in deposit and Rs 21.39 arba in loan in the corresponding quarter.


Prime’s non-performing loan has, however, significantly decreased from 2.92 percent to 2.01 percent.

Its EPS now stands at Rs 21.41, its net worth per share at Rs 133.16, and P/E ratio at 21.63.

Bank expected to post much better growth by Q4

It may still be noted that Prime Commercial Bank is poised to make a net profit of more than Rs 70 crore by the fourth quarter in the current fiscal year 2070/71, according to highly placed sources in the bank.

Going by that data, Prime’s net profit is likely to rise by 47 percent in the current fiscal year as compared to the last fiscal year 2069/70.

It had posted a growth in net profit of 78.06 percent in the last fiscal year 2069/70 by earning a profit of Rs 47.97 crore.

“Another encouraging thing about Prime Bank’s financial health in the current fiscal is that its non-performing loan is falling significantly,” the source said, though he did not provide the figure.

Prime’s NPA had risen by an alarming 193.42 percent from 0.7 percent in the previous fiscal to 2.23 in the last fiscal year.
 
If we compare the third and the fourth quarterly report of the bank in the last fiscal year, we see that the net profit had risen by 24 percent.

Prime Bank had posted a net profit rise of 91.65 percent to Rs 31.01 crore in the second quarter, up from Rs 16.18 crore in the corresponding quarter of the last fiscal year 2069/70.

It had posted 38 percent net profit rise in the first quarter as compared to the corresponding quarter of the previous fiscal.