54% banks see higher profits

More than 54 per cent of listed banks reported a year-on-year surge in their profits in the just-concluded January-March quarter of the year 2023.

The lenders’ profits grew in the quarter owing to an increase in deposits, higher recoveries of loans and advances, and the inflated earnings from the forex division.

Out of the 35 listed banks, 16 lenders registered a rise in their net profits in the first quarter of 2023 on a year-on-year basis, as per data available on the Dhaka Stock Exchange (DSE) website.

When the majority of listed banks posted a profit rise, 14 lenders, however, reported a year-on-year slump in their net profits during the January-March period of 2023.

Out of the profit makers, nine lenders witnessed a net profit of over Tk 100 crore each in the quarter.

On the other hand, two banks – ICB Islamic Bank, and National Bank – incurred massive losses in the January-March quarter.

At the same time, two other banks saw their profits unchanged in the just-finished January-March quarter of the current year, while the remaining one has not yet published this year’s first quarterly financial report.

Among the listed peers, Southeast Bank Limited posted the highest net profit of Tk 147 crore in the January-March period this year, although it was lower than the profit of Tk 156 crore in the same period last year.

Its earnings per share (EPS) slightly fell to Tk 1.19 for Q1 this year from Tk 1.26 for the same quarter of 2022.

Brac Bank posted Tk 143 crore in net profit in the first quarter of 2023, which was much higher than the profit of Tk 115 crore in the same quarter of 2022.

The private commercial lender’s earnings per share (EPS) rose to Tk 0.96 at the end of the January-March period this year from Tk 0.77 at the end of the same period last year.

Meanwhile, Pubali Bank Limited registered a net profit of Tk 136 crore in the January-March quarter this year, against the profit of Tk 122 crore in the first quarter of 2022.

Jamuna Bank’s net profit jumped to Tk 133 crore in Q1 of 2023 from the profit outlay of Tk 128 crore in the same period last year.

The bank in its first quarterly financial report said its profit surged due to a rise in net interest income as well as investment income.

Five other banks which made profits of over Tk 100 each include Bank Asia (Tk 132 crore), Dutch-Bangla Bank (Tk 125 crore), Eastern Bank (Tk 107 crore), Shahjalal Islami Bank (TK 105 crore), and Prime Bank (Tk 104 crore).

Moreover, NRB Commercial Bank, NCC Bank, Premier Bank, Mutual Trust Bank, IFIC Bank, Global Islami Bank, Uttara Bank, United Commercial Bank, and SIBL witnessed substantial growth in profit in the January-March quarter of 2023.

On the other hand, Mercantile Bank’s net profit declined to Tk 68 crore in Q1 of 2023 from the profit of Tk 88 crore in the same period last year.

The bank’s earnings per share dropped to Tk 0.63 for the January-March quarter of the current year from Tk 0.82 for the same period last year.

National Bank was the biggest loser during the January-March period of the ongoing calendar year, as the lender’s net loss grew to Tk 312 crore in the quarter from the first quarterly loss of Tk 57 crore last year.

Its earnings per share stood at Tk 0.97 negative for Q1 this year, against Tk 0.18 negative for the same period last year.

Another Bank which logged a first quarterly loss is ICB Islamic Bank, with its net loss reaching Tk 10 crore in the January-March period this year from the loss Tk 8 crore in the same period last year.

The bank blamed the banking sector’s recent liquidity crunch behind its loss, as its borrowers could not repay their installments in time, and that’s why interest from such loans and advances could not be taken to the income.

Professor Abu Ahmed, a capital market analyst, told The Business Post, “Among the listed banks, which are fundamentally sound, are doing well always. At the same time, the bad ones are continuously making ill performance.”

“Banks had failed to navigate properly last year due to the dollar crisis. But the dollar remained stable in the just-concluded quarter. Despite the ease of the crisis, many lenders displayed poor performance in the quarter,” he added.