Nepal Infrastructure Bank (NIFRA) recently published its unaudited financial report for the fourth quarter of the past fiscal year, revealing a notable drop in net profit.
According to the published details, NIFRA’s net profit saw a decrease of 19.98 percent, settling at Rs. 98 crore 73 lakh. In comparison, the bank had earned a net profit of Rs. 1 arba 23 crore 40 lakh during the same period in the previous year.
This decline in profit primarily resulted from an increase in interest expenses and a fall in net interest income. However, a reversal of impairment charges amounting to Rs. 21 crore 27 lakh helped prevent an even larger drop in the bank’s profit.
Key Financials
By the end of the fourth quarter, NIFRA’s net interest income declined by 23.88 percent to Rs. 1 arba 45 crore. Similarly, operating income also decreased by 21.72 percent, reaching Rs. 1 arba 50 crore. The impairment charge reversal this review period was Rs. 21 crore 27 lakh, higher than the Rs. 18 crore reversed in the previous year.
A significant highlight for the bank is its non-performing loan (NPL) ratio, which remains at an impressive zero percent.
During the review period, the bank successfully collected deposits amounting to Rs. 7 arba 84 crore and extended loans totaling Rs. 31 arba 42 crore.
Capital and Shareholder Metrics
The bank’s paid-up capital stands at Rs. 21 arba 60 crore, with a reserve fund of Rs. 3 arba 72 crore. Earnings per share (EPS) declined by Rs. 1.14, now standing at Rs. 4.57. Furthermore, the net worth per share is reported as Rs. 117.22.
Other Important Indicators
Looking at additional financial indicators, the bank’s cost of funds slightly decreased from 6.51 percent to 6.46 percent. The base rate also saw a reduction, moving from 6.97 percent to 6.77 percent. The credit-deposit (CD) ratio increased by 14.67 percentage points, reaching 79.92 percent. During the review period, the bank’s price-to-earnings (P/E) ratio was 53.73 times, and its total assets stood at Rs. 41 arba 84 crore.
Management’s Outlook and Strategy
According to the bank’s management analysis, NIFRA has adopted a strategy to expand investment in large infrastructure projects and to make resource mobilization more effective. Internal challenges identified includes interest rate fluctuations and liquidity management. External challenges include global economic instability and the rise in fuel prices. The bank also diversify its portfolio in sectors such as hydropower, solar energy, and industrial infrastructure.
AI Disclaimer: This article was originally published on https://bajarkochirfar.com. It has been translated with the help of AI. For the best understanding and accurate facts, we recommend reading the original Nepali version.
