Siddhartha Bank Limited has published its unaudited fourth-quarter financial report of the last fiscal year, showing a 4.5 percent growth in net profit while its dividend capacity faces pressure due to rising bad loans.
Siddhartha Bank Limited has released its unaudited financial report for the fourth quarter of the last fiscal year. According to report, the bank net profit increased by 4.5 percent to reach Rs 3 Arba 52 Crore. In the same period of previous year, the company had earned Rs 3 Arba 37 Crore in net profit. Even though the impairment charge for managing bad loans went up, the net profit increased because of improvement in net fee and commission income and operating income.
By the fourth quarter, the net interest income of Siddhartha Bank increased by 7.24 percent to reach Rs 9 Arba 5 Crore. Similarly, the operating income of the bank grew by 8.6 percent to Rs 12 Arba 5 Crore. However, due to some difficulties in recovering loans, the impairment charge rose from Rs 1 Arba 38 Crore to Rs 1 Arba 77 Crore.
Rising Bad Loans and Business Growth
During this period, the non-performing loan ratio of the bank, which is also known as bad loans, increased by 0.91 percentage points to reach 3.53 percent.
But on a good side, the bank has done a great job in expanding its business. Siddhartha Bank collected deposits of Rs 3 Kharba 27 Arba 12 Crore and extended loans of Rs 2 Kharba 33 Arba 2 Crore. The deposit collection grew by 13.1 percent and loan extension increased by 8.7 percent, which shows positive public trust and business expansion for the bank.
Financial Indicators and Dividend Capacity
Currently, the paid-up capital of Siddhartha Bank is Rs 18 Arba 29 Crore. The distributable profit that can be distributed as dividend to shareholders is Rs 1 Arba 71 Crore. The bank also has Rs 16 Arba 92 Crore in its reserve fund. Compared to last year, the earnings per share (EPS) of the bank increased by Rs 0.3 to reach Rs 23.06, and the net worth per share is Rs 225.17.
Overall, even though the bank increased its business and net profit, the distributable profit which decides the dividend for investors has decreased. Because of this, the distributable EPS is only Rs 11.53.
Read also: Shine Resunga Development Bank profit jumped by 83 percent, why did it increase?
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.
