Profit Downturn for Nepal Investment Mega Bank in Q2 Due to Elevated Impairment Charges: NPL at 4.75%
Sun, Jan 21, 2024 8:05 AM on Financial Analysis, Company Analysis, Latest,
Nepal Investment Mega Bank Limited (NIMB) recently unveiled its second-quarter fiscal report for 2080/81, revealing a 13.62% decline in net profit, which decreased to Rs 1.08 Arba.
Despite this setback, the bank showcased a robust financial position with a total paid-up capital of Rs. 34.12 Arba and reserves amounting to Rs. 26.07 Arba. However, a noteworthy aspect is the negative retained earnings standing at Rs 1.95 Arba.
During the same period, the bank's total deposits reached an impressive Rs 3.89 Kharba, with loans and advances to customers totaling Rs 3.12 Kharba. Notably, the bank experienced a substantial 80.20% increase in Net Interest Income, reaching Rs. 7.54 Arba. On the flip side, there were notable expenditures, including personnel expenses of Rs. 1.73 Arba and impairment charges of Rs. 2.86 Arba.
In terms of financial metrics for the second quarter, the bank reported an annualized EPS of Rs 10.56, and the net worth per share stood at Rs 170.68. However, a concern arose as the Non-Performing Loans (NPL) spiked to 4.75%. Additionally, the bank disclosed a negative distributable profit of Rs. 1.95 Arba.
* Figures are of Immediate Previous Year Quarter Ending
| Particulars (In Rs '000) | Nepal Investment Mega Bank | ||
|---|---|---|---|
| Q2 2080/81 | Q2 2079/80 | Difference | |
| Paid Up Capital | 34,128,595.00 | 34,128,595.00* | 0.00% |
| Share Premium | 0.00 | 0.00 | - |
| Retained Earnings | -1,955,472.00 | 158,338.00* | -1335.00% |
| Reserves | 26,076,711.00 | 23,894,546.00* | 9.13% |
| Deposits | 389,034,647.00 | 354,414,420.00* | 9.77% |
| Loans & Advances | 312,607,428.00 | 303,655,955.00* | 2.95% |
| Net Interest Income | 7,543,828.00 | 4,186,364.00 | 80.20% |
| Personnel Expenses | 1,730,748.00 | 980,051.00 | 76.60% |
| Impairment Charges | 2,867,846.00 | 608,343.00 | 371.42% |
| Operating Profit | 3,024,514.00 | 2,982,448.00 | 1.41% |
| Net Profit | 1,801,944.00 | 2,086,307.00 | -13.63% |
| Distributable Profit/ (Loss) after P/L Appropriation and Regulatory Adjustment | -1,955,472.00 | -1,604,224.00 | 21.90% |
| Capital Adequacy (%) | 12.70 | 13.28 | -4.37% |
| Cost of Fund (%) | 7.27 | 8.22 | -11.56% |
| NPL (%) | 4.75 | 3.71 | 28.03% |
| Annualized EPS (In Rs.) | 10.56 | 12.23 | -13.63% |
| Net Worth per Share (In Rs.) | 170.68 | 170.48 | 0.12% |
| Qtr end PE Ratio (times) | 16.64 | ||
| Qtr End Market Price | 175.7 | - | |
