Bangladesh Finance profit sinks on lower interest income

Bangladesh Finance, a publicly traded non-bank financial institution (NBFI), reported a huge decline in net profit in the first six months of 2023 due to a fall in net interest income and lower investment returns.

The company posted a net profit of Tk 5.53 crore in the first six months (January-June) of 2023, which was nearly 70 per cent lower than the profit of Tk 18.20 crore made in the corresponding period last year.

As per its unaudited financial report posted on the DSE website on Monday, the listed NBFI’s interest income in the first six months of 2023 stood at Tk 65.47 crore, against Tk 78 crore in the same period last year.

Thus, the company’s interest income plunged by 16.06 per cent year-on-year in the first half of the current year.

As per its financial report, the company’s interest paid on deposits and borrowings was Tk 50.83 crore in January-June 2023, compared to Tk 49.93 crore in the same period last year.

Meanwhile, the company’s investment return slumped by 83 per cent to Tk 2.16 crore in H1 this year, compared to Tk 12.24 crore in the same period last year.

The company also released its financial statement for the second quarter (April–June) of the 2023. As per its financial report, the company’s net profit fell by 66 per cent year-on-year in the current year’s June quarter.

The NFBI posted a net profit of Tk 3 crore in the April-June period, against Tk 8.84 crore in the same period last year.

The listed entity’s consolidated net operating cash flow per share (NOCFPS) was Tk 5.17 negative for January-June 2023 against Tk 1.15 for January-June 2022.

Its consolidated NAV per share was Tk 16.65 as on June 30, 2023, which was Tk 17.41 till December 31, 2022.

In its balance sheet, Bangladesh Finance, which got listed on local stock exchanges in 2007, said the consolidated EPS fell due to a decrease in net interest income and lower income from investment in securities.

Meanwhile, the NOCFPS plunged due to the net outflow of deposits, decrease in interest income, and payment of income tax liabilities.

Bangladesh Finance has two subsidiaries – BD Finance Securities Limited (BD Securities) and BD Finance Capital Holdings Limited (BD Capital).

Bangladesh Finance holds a 56.34 per cent stake in BD Finance Securities, while it owns 99.97 of BD Capital shares.

Sponsors and directors jointly held a 31.20 per cent stake in Bangladesh Finance, while institutional investors owned 15.06 per cent, and general investors 53.74 per cent as on June 2023.