The net profit of commercial banks dropped 4.62% year-on-year in the first six months of the current fiscal year. The combined net profit of 20 commercial banks totaled Rs 27.43 billion in this period, compared to Rs 28.76 billion in the corresponding period last fiscal year, according to their recently released unaudited financial reports for the second quarter.
Eleven banks saw their profits rise, with Prabhu Bank recording the highest growth of 85.49%. The bank earned over Rs 1.33 billion in net profit this year, compared to Rs 720.3 million in the same period last fiscal year. This remarkable growth is attributed to a reduction in impairment charges, which fell from Rs 1.25 billion to Rs 814.2 million in the period.
Other banks that reported higher profits this year include Nepal Investment Mega Bank, Global IME Bank, NMB Bank, Everest Bank, Laxmi Sunrise Bank, Nepal SBI Bank, Sanima Bank, Nabil Bank, Himalayan Bank, and Machhapuchhre Bank.
On the contrary, NIC Asia Bank experienced the sharpest decline in net profit, dropping by 92.03%. It totalled Rs 151 million in the first six months of this fiscal year, compared to NPR 1.9 billion in the same period last year.
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The decline is primarily attributed to a significant increase in impairment charges, which surged to over Rs 2.35 billion, compared to just Rs 480 million during the same period last year.
Apart from NIC Asia Bank, the banks that saw a decline in net profits include Kumari Bank, Rastriya Banijya Bank, Siddhartha Bank, Agricultural Development Bank, Nepal Bank, Citizens Bank, Prime Commercial Bank, and Standard Chartered Bank.
These declines are largely attributed to higher allocations under impairment charges, affecting their profitability during the period.
