Stunted by massive provisioning, Himalayan and Civil banks report marginal profit growth

ShareSansar, February 12:

Himalayan Bank Limited and Civil Bank Limited have reported marginal rise in net profit in the second quarter of the current fiscal year 2070/71—thanks to huge amount these commercial banks had to provision for possible losses.

According to the unaudited quarterly report published by Himalayan Bank today, its net profit has risen to Rs 54.44 crore, up from Rs 50 crore in the corresponding quarter of the last fiscal—a growth of just 8.8 percent.

Himalayan Bank’s profit growth was limited by Rs 18.49 crore (net) it had to provision for possible losses, probably in the Melamchi project case.

Insofar as its core business is concerned, it posted a good net interest income of Rs 1.17 arba, up from Rs 1.14 arba in the corresponding quarter.

It mobilized Rs 59.76 arba in deposit and Rs 43.95 arba in loan as compared to Rs 47.53 arba in deposit and Rs 38.96 arba in loan in the second quarter of the last fiscal.

Its non-performing loan has marginally risen to 3.46 percent of the total loan, up from 3.20 in the corresponding quarter.

Its EPS stands at 39.46 and net worth per share at 220.32.

Meanwhile, Civil Bank has reported a profit growth of 1.19 percent as its net profit rose to Rs 3.39 crore in the second quarter, up from Rs 3.35 crore in the corresponding quarter.

Like the Himalayan Bank, Civil’s growth was also largely stunted by a huge amount it provisioned for the possible losses, which stands at Rs 11.81 crore.

Otherwise, its core business did pretty well in the second quarter. Civil’s net interest income surged to Rs 23.69 crore, up from just Rs 18.65 crore in the corresponding quarter.

It mobilized Rs 18.48 arba in deposit and Rs 15.29 in loan in the second quarter as compared to Rs 11 arba in deposit and Rs 9.78 arba in loan in the corresponding quarter.

Its NPL has also dipped marginally to 1.45 from 1.48.

Civil’s EPS (annualized) stands at 3.40 and net worth per share at 103.61.