महालक्ष्मी विकास बैंकको चौथो त्रैमासिक वित्तीय विवरण (आ.व. २०७९/८०)Mahalaxmi Bikas Bank: Q4 Financial Results FY 2079/80

Mahalaxmi Bikas Bank Ltd.

Unaudited Financial Results (Quarterly)

4th Quarter ended of Fiscal Year 2079/80

Condensed Statement of Financial Position

As on Quarter ended 31st Ashad 2080

Amount in NPR

Assets This Quarter Ending Immediate Previous Year Ending

Cash and cash equivalent	1,540,468,558	2,952,870,738
Due from Nepal Rastra Bank	2,038,085,775	2,215,803,424
Placement with Bank and Financial Institutions	-	-
Derivative financial instruments	-	-
Other trading assets	-	-
Loan and advances to B/FIs	2,792,871,923	3,833,409,822
Loans and advances to customers	43,341,360,666	41,510,404,522
Investment securities	13,152,928,333	12,462,462,782
Current tax assets	68,278,220	60,465,953
Investment in subsidiaries	-	-
Investment in associates	6,466,400	6,466,400
Investment property	520,838,524	547,660,001
Property and equipment	602,336,552	537,693,098
Goodwill and Intangible assets	10,985,185	5,366,926
Deferred tax assets	120,104,504	111,346,829
Other Assets	862,290,782	885,253,225
Total Assets	65,057,015,421	65,129,203,720

Liabilities This Quarter Ending Immediate Previous Year Ending

Due to Bank and Financial Institutions	641,403,520	1,101,615,285
Due to Nepal Rastra Bank	-	-
Derivative financial instruments	-	-
Deposits from customers	55,009,924,544	55,115,470,657
Borrowing	-	-
Current Tax Liabilities	-	-
Provisions	-	-
Deferred tax liabilities	-	-
Other liabilities	947,200,180	832,827,862
Debt securities issued	995,843,833	995,443,823
Subordinated Liabilities	-	-
Total liabilities	57,594,372,078	58,045,357,627

Equity This Quarter Ending Immediate Previous Year Ending

Share capital	4,511,281,066	4,296,458,158
Share premium	-	-
Retained earnings	465,198,925	445,596,833
Reserves	2,486,163,352	2,341,791,102
Total equity attributable to equity holders	7,462,643,343	7,083,846,093
Non-controlling interest	-	-
Total equity	7,462,643,343	7,083,846,093
Total liabilities and equity	65,057,015,421	65,129,203,720
Net assets value per share	165.42	164.88

Condensed Statement of Profit or Loss

As on Quarter ended 31st Ashad 2080

Amount in NPR

Particulars Current Year This Quarter Current Year Upto This Quarter (YTD) Previous Year Corresponding This Quarter Previous Year Corresponding Upto This Quarter (YTD)
Interest income	1,033,976,175	4,337,979,317	1,090,559,948	4,877,104,524
Interest expense	517,628,216	2,189,228,561	685,767,185	2,935,887,676
Net interest income	516,347,958	2,148,750,757	404,792,763	1,941,216,848
Fee and commission income	62,549,689	252,896,320	76,303,512	234,846,574
Fee and commission expense	7,818,587	22,418,383	12,298,171	28,282,592
Net fee and commission income	54,731,102	230,477,937	64,005,340	206,563,982
Net interest, fee and commission income	571,079,060	2,379,228,693	468,798,103	2,147,780,830
Net trading income	(168,112)	22,762	(323,324)	231,137
Other operating income	4,363,588	109,373,518	45,477,694	123,810,259
Total operating income	575,274,536	2,488,624,973	513,952,473	2,271,822,226
Impairment charge/(reversal) for loans and other losses	(17,399,827)	315,680,916	258,567,248	517,372,903
Net operating income	592,674,363	2,172,944,057	255,385,225	1,754,449,323
Operating expense	348,415,868	1,235,007,026	272,158,195	1,143,042,430
Personnel expenses	233,143,433	799,060,835	141,713,025	689,169,995
Other operating expenses	96,805,579	362,247,092	111,811,262	382,674,799
Depreciation & Amortization	18,466,856	73,699,098	18,633,907	71,197,637
Operating Profit	244,258,495	937,937,031	(16,772,969)	611,406,893
Non operating income	169,480	2,601,987	413,350	744,690
Non operating expense	1,588,724	40,608,121	11,981,498	16,836,355
Profit before income tax	242,839,252	899,930,897	(28,341,117)	595,315,229
Income tax expense	72,851,775	269,979,269	(16,100,151)	170,996,753
Current Tax	72,851,775	269,979,269	72,947,228	260,044,132
Deferred Tax Income / Expenses	-	-	(89,047,379)	(89,047,379)
Profit for the year	169,987,476	629,951,628	(12,240,966)	424,318,476

Condensed Consolidated Statement of Comprehensive Income

Profit/(Loss) for the Period	169,987,476	629,951,628	(12,240,966)	424,318,476
Other Comprehensive Income	(15,947,451)	(20,434,575)	61,956,303	82,250,677
Total Comprehensive Income	154,040,025	609,517,053	49,715,337	506,569,153
Earnings per Share
Basic earnings per share	-	13.96	-	9.88
Diluted earnings per share	-	13.96	-	9.88
Profit attributable to:
Equity holders of the Bank	154,040,025	609,517,053	49,715,337	506,569,153
Non-controlling interest	-	-	-	-
Total income	154,040,025	609,517,053	49,715,337	506,569,153

Note:

• Above Financial Statements are prepared in accordance with Nepal Financial Reporting Standards (NFRS).

• Loan & Advances Includes Staff loans and accrued interest receivable on loans and are presented net of loan impairments.

• Bank has assessed and measured impairment loss on Loan & Advances at higher of amount derived as per norms prescribed by NRB and as per NFRS 9.

• Personal Expenses includes employee bonus calculated as per Bonus Act, 2030.

• Previous Quarter ending figure have been restated, regrouped, reclassified to make them comparable, which might vary from previous quarter published figure.

• The unaudited financial figures are subject to change from external auditor and regulatory authority.

• Detailed interim report has been published in Bank's website www.mahalaxmibank.com.

Particulars Upto This Quarter Corresponding Upto This Quarter

Net profit or (loss) for the period end Ashad 83	629,951,628	424,318,476
Appropriations:
a. General reserve	(125,990,326)	(84,863,695)
b. Capital redemption reserve	-	-
c. Exchange fluctuation fund	(1,202,114)	(526,994)
d. Corporate social responsibility fund	(6,299,516)	(4,243,185)
e. Employees' training fund	3,264,555	4,126,693
f. Other-
Investment Adjustment Reserve	-	(1,732,500)
Fair value reserve	-	-
CSR expense reversal	4,335,015	4,832,143
Profit or (loss) before regulatory adjustment	504,059,242	341,910,938
Regulatory adjustment :
a. Interest receivable (-)/previous accrued interest received (+)	(22,602,847)	177,595,602
b. Short loan loss provision in accounts (-)/ reversal (+)	-	-
c. Short provision for possible losses on investment (-)/reversal (+)	-	-
d. Short loan loss provision on Non Banking Assets (-)/reversal (+)	13,349,049	(7,567,812)
e. Deferred tax assets recognised (-)/ reversal (+)	(26,921,840)	(68,292,459)
f. Goodwill recognised (-)/ impairment of Goodwill (+)	-	-
g. Bargain purchase gain recognised (-)/ reversal (+)	-	-
h. Actuarial loss recognised (-)/reversal (+)	-	2,269,468

i. Other (+/-)

Fair Value Gain On Investment	2,444,602	-
Interest Capitalized Reserve	(5,183,402)	(1,068,388)
Net profit for the period end Ashad 2083	465,144,803	444,847,348
Opening Retained Earning	445,596,833	292,319,290

Adjustment(+/-) - 422,496

Distribution:
Bonus Share issued	(214,822,908)	(125,139,558)
Cash Dividend Paid	(230,719,803)	(166,852,744)
Total Distributable Profit or (Loss) as on Ashad Quarter End, 2083	465,198,925	445,596,833
Distributable Profit/Loss per Share	10.31	10.37

Regulatory Ratios as per NRB Unified Directive

Particulars Current Year Upto This Quarter (YTD) Previous Year Corresponding Upto This Quarter (YTD)

Capital Fund to RWA (%) 17.57% 17.06%

Tier 1 Capital to RWA (%) 14.04% 13.53%

CET 1 Capital to RWA (%) 14.04% 13.53%

Non-Performing Loan (NPL) to Total Loan (%) 6.32% 4.98%

Net Non-Performing Loan (NPL) to Total Loan (%) 1.52% 0.76%

Total Loan Loss Provision to Total NPL (%) 97.28% 113.00%

Cost of Funds (%) 3.62% 4.56%

Credit to Deposit Ratio (CD Ratio as per NRB) (%) 86.82% 83.98%

Base Rate (%) 5.66% 6.94%

Interest Rate Spread (%) 4.19% 4.48%

Return on Equity 8.66% 6.14%

Return on Assets 0.97% 0.65%

Disclosure as prescribed by Securities Registration and Issuance Regulation, 2073

(Related to Sub rule (1) of Rule 26), for the Fourth Quarter of Fiscal Year 2082/83)

1. Financial Detail

a) Quarterly statement of financial position and statement of profit or loss has been published along with this detail.

b) Major Financial Indicators

1 Earnings per Share (Annualized) 13.96

2 Price Earnings ratio 24.78

3 Net Worth per Share 165.42

4 Return on Total Asset (Annualized) 0.97%

5 Return on Equity (Annualized) 8.66%

6 Liquidity Ratio 27.35%

2. Management Analysis:

The bank has posted a net profit of NPR 629,951,628/- up to the fourth quarter of FY 2082/83, with a growth 48.46 percentage corresponding to the previous year's results. The bank remains strong in terms of capital adequacy and liquidity. However, due to challenges in loan recovery amidst a difficult economic situation, the non-performing assets (NPA) have increased to 6.32%. Despite reduced interest rates, adequate liquidity, and a sound credit-to-deposit (CD) position, stagnant credit demand has affected overall business performance. Nevertheless, the bank remains committed to achieving its business targets, maximizing returns, and delivering excellent customer service.

3. Details relating to legal action

a) Case filed by or against the Bank in this year: No such information has been received.

b) Case relating to disobedience of prevailing law or commission of criminal offence filed by or against the Promoter or Director of the Bank: No such information has been received.

c) Case relating to financial crime filed against any Promoter or Director: No such information has been received.

4. Analysis of stock performance of the Bank

The Bank's share price and transaction are determined according to the demand and supply of shares in the market. Maximum, minimum and last share price of the Bank including total share transaction number, volume and days of transaction during the quarter are:

Maximum Share Price NPR. 391.00

Minimum Share Price NPR. 340.10

Last Share Price NPR. 346.00

Transaction volume (No. of shares) 1,350,211.00

Transaction volume (Amount in NPR) 493,064,267.90

Transaction Days 64

5. Problems and Challenges

Internal:

i) Increased cost of operation.

ii) Sourcing and retention of quality workforce in the increased competitive banking industry.

iii) Challenge to manage operational risk and minimize risk relating to information technology.

External:

i) Increased level of operational risk in the industry.

ii) Challenge to recover the interest as a result of overall economic downturn and political instability.

iii) Subdued credit demand.

6. Strategy to overcome Problems and Changes

i) To revise strategy and planning according to the ongoing market scenario.

ii) Effective management of cost of deposit and total operating expense.

iii) Provide banking service to population still not within the Bank reach and mobilize deposit.

iv) Provide uninterrupted service through the use of information technology.

v) Introduction of customer-oriented & innovative products and services focusing on digital banking.

vi) Strengthening human resource capabilities to minimize various risk.

vii) Proper portfolio management targeting good quality loan customers.

viii) Focus on strengthening internal control and monitoring system and policy to cope with various risks.

7. Corporate Governance

The Bank is committed towards high standard of corporate governance, professionalism, ethical standard and compliance with superior standard in business practice. In order to maintain the superior standard of corporate governance, various committees are effectively functioning in the Bank. Further, Internal Audit Department of the Bank is also outsourced and it is functioning effectively. The Bank has been fully complying with the directives and guidelines issued by NRB.

8. Declaration of CEO

To the best of my knowledge, the information published in this report is true and fair. No material information for investors has been concealed. I personally take the responsibility for fair presentation of report.