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Most of the listed commercial banks have reported higher earnings per share (EPS) in the second quarter of the current year compared to the same period last year.
According to the Dhaka Stock Exchange (DSE) data till Saturday, 27 out of 31 listed banks disclosed their financial statements, where 24 banks posted higher EPS while three banks witnessed negative income growth between April-June this year.
Market insiders said that lower cost of funds pushed up the profit for the banks during the period under review. The banks, which managed non-performing loans (NPLs) using the Bangladesh Bank’s relaxed loan classification rules, booked better earnings during the period.
Talking to The Business Post, Mutual Trust Bank Limited (MTB) Managing Director and CEO Syed Mahbubur Rahman said, loans have not been classified over the last year. The period to the classification is closed on the basis of bank-customer relationship. That is why many banks do not require keeping provisions.
Mahbubur, also a former chairman of Association of Bankers, Bangladesh (ABB), said that the loan-to-deposit ratio has increased in April this year as compared to April last year. Most of the listed banks have also increased their earnings per share due to the reduction in cost of funds.
A top official of a stock brokerage house told The Business Post that the rise in the profitability of the banking sector bears good news for the stock investors. The enhanced profitability of banks will have a positive impact in the stock market, he added.
The EPS is the company's profit allocated to each share of a listed firm, which indicates a company's profitability.
As per the unaudited financial statement, IFIC Bank registered the highest income growth by 422 per cent in the second quarter and its EPS stood at Tk0.47, which was Tk0.09 in the same period a year ago.
IFIC’s consolidated EPS for six months ended on June 30, 2021, which rose to Tk 0.91 for January-June 2021 as against Tk 0.51 for January-June 2020.
Prime Bank's consolidated EPS rose by more than 400per cent to Tk0.47 in April-June this year, which was Tk0.09 last year.
According to the DSE, the EPS of Brac Bank rose by 357 per cent to Tk0.96 from Tk0.21, that of Uttara Bank by 320 per cent to Tk1.05 from Tk0.25 and The City Bank by 290 per cent to Tk1.13 from Tk0.29.
Eastern Bank has posted more than 88 per cent increase in its earnings in the April-June’21 period. The bank’s consolidated earnings per share stood at Tk 1.47 in April-June, 2021, an increase of 88.46 per cent, from Tk 0.78 in the same period of the previous year.
Its consolidated EPS for six months ended on June 30, 2021, which rose to Tk 2.56 for January-June 2021 as against Tk 1.65 for January-June 2020.
The newly listed NRB Commercial Bank has posted about 214 per cent up in its earnings in the second quarter that ended June 2021 compared to the same quarter of the last year.
The bank’s consolidated EPS stood at Tk 0.69 in April-June, 2021 as against Tk 0.22 in the same period of last year.
The bank’s consolidated EPS for six months ended on June 30, 2021, also jumped to Tk 1.11 for January-June 2021 as against Tk 0.49 for January-June 2020.
Standard Bank’s EPS stood to Tk0.06 in Q2 of this year, which was negative Tk0.31 in the same period last year. The bank's consolidated EPS for six months that ended on June 30, 2021, also rose 283 per cent to Tk 0.23, up from Tk 0.06 in the same period of the last year.
According to DSE data, the EPS of Islami Bank, AB Bank, Mercantile Bank, Shahjalal Islami Bank, Southeast Bank, NCC Bank, One Bank, Premier Bank, First Security Islami Bank, Jamuna Bank, Pubali Bank, Social Islami Bank, UCB and Trust Bank also rose in the second quarter of the year compared to the same period previous year.
On the other hand, Mutual Trust Bank’s EPS declined by 57 per cent. The bank’s consolidated EPS was Tk 0.26 for April-June 2021 as against Tk0.79 for April-June 2020 while consolidated EPS was Tk 1.08 for January-June 2021 as against Tk 1.34 for the same period of the last year.
The bank has noted that EPS has fell compared to the same period of last year due to higher requirements of loan loss provision, its CEO said.
Dutch-Bangla Bank's earnings per share tumbled by 4.03 per cent to Tk 2.14 for April-June, 2021 as against Tk 2.23 for the same period a year earlier.
However, the bank's EPS for six months ended on June 30, 2021, rose 4.38 per cent to Tk 3.57 for January-June 2021 as against Tk 3.42 for January-June 2020.
ICB Islamic Bank has continued to incur losses. The bank's per share loss stood at Tk0.17 in the second quarter of 2021 from Tk0.23.
