The net profit of bKash Ltd, Bangladesh’s top mobile financial service (MFS) provider, jumped six-fold last year thanks to its continued strategic investments over the years.
The subsidiary of Brac Bank posted Tk 104 crore in net profit in 2023, compared to Tk 17.21 crore posted in the previous year, according to Brac Bank’s audited financial statement.
bKash registered a 22 per cent year-on-year increase in revenue to Tk 4,190 crore in 2023, from the previous year's Tk 3,430 crore.
The leading MFS provider, after bracing for losses in the previous three years, returned to profit in 2022. It had been suffering consistent losses since 2019 with a loss of Tk 123 crore in 2021, Tk 67 crore in 2020, and Tk 62.51 crore in 2019.
bKash said the surge in profit is attributed to its continued strategic investments over the years. The performance of bKash Ltd has been very satisfactory in 2023. Net profit of bKash after tax soared by 504 per cent to Tk 103.9 crore in 2023.
The company further strengthened its superior position and acceptability in the market through its diverse services and technology based capacity, bKash said in the Brac Bank’s audited financial report.
BRAC Bank formed bKash Ltd, a private company limited by shares incorporated on March 1, 2010. bKash Ltd was established to introduce mobile financial services in Bangladesh.
The bank has obtained a license from the Bangladesh Bank for bKash to render mobile financial services. BRAC Bank currently holds 51 per cent equity shares in the company.
With the consent of all existing shareholders, in 2014 the Bill & Melinda Gates Foundation (B&M), in 2018 Alipay Singapore E-Commerce Private Ltd (Alipay), and in 2021 SoftBank, had invested in bKash Ltd in the form of convertible preference shares.
Until December 2021, out of the total 163,104 convertible preference shares, B&M owned 22,525 shares, Alipay 55,433 shares, and SoftBank 85,146 shares.
Over the years, bKash has built a robust network of over 300,000 agents and 300,000 merchants across the country. It also gets integrated with banks, financial institutions and service providers to strengthen the cashless digital financial ecosystem of the country.
As a result, bKash has now a large customer base of over 7 crore.
Brac Bank financial status
The BRAC Bank reported that its consolidated profit increased by 91 per cent in the first quarter (Jan-Mar) of 2024, compared to the previous year at the same time.
Its consolidated earnings per share (EPS) stood at Tk 1.70 during the first quarter, which was Tk 0.89 a year ago.
Bank officials said wider investment opportunities following the withdrawal of the lending rate cap in July last year played a pivotal role behind the steady profit growth. A higher profit in January-March this year was in continuation of the last year’s earnings growth.
The company’s investment income jumped 105 per cent in January-March this year from the same quarter of the previous year, while interest income escalated 33 per cent year-on-year during this period.
BRAC Bank reported 35 per cent growth in profit, crossing Tk 800 crore, for the year ending on December 31, 2023, which is the highest-ever profit in the company’s history.
The remarkable profit is thanks to the bank’s focus on small and medium enterprises (SME) and technology-based customer services, which added more than 3,60,000 new customers.
Meanwhile, the bank’s Board of Directors recommended 10 per cent cash and 10 per cent stock dividends for 2023, the highest since 2017 when the bank paid 25 per cent stock dividends.
The publicly traded bank’s net profit rose to Tk 827 crore last year, which was Tk 612 crore the year before, according to the annual financial statement. Its consolidated earnings per share (EPS) were Tk 4.73 last year, which was Tk 3.75 in 2022.
