सिटिजन्स बैंकको असार मसान्तसम्मको अन्तरिम वित्तीय विवरणCitizens Bank Interim Financial Statements (Ashad 2083)

Citizens Bank

Interim Financial Statements

Condensed Consolidated Statement of Financial Position

As on Quarter ended Ashad 2083

Borrowing 294,829,000 - - -

Condensed Consolidated Statement of Profit or Loss

For the Quarter ended Ashad 2083

Statement of Distributable Profit or Loss

Amount in NPR

Current Year Upto this Qtr YTD Previous Year Corresponding Qtr YTD

Securities Registration and Issue Regulations, 2073 - Schedule 14

(Related to Sub-regulation (1) of Regulation 26)

Fourth Quarterly Report of FY २०८२/८३

1. Financial Statements

(a) Statement of Balance Sheet, Profit and Loss for the quarterly period.

The bank's Balance Sheet and Profit and Loss statement for the quarterly period are published herewith.

(b) Related Parties

Details of transactions with related parties of the bank are included in the bank's Interim Financial Report. The bank's fourth quarter Interim Financial Report can be viewed on the bank's website www.ctznbank.com.

(c) Major Financial Ratios

Earnings Per Share Rs. १३।५३ Total Assets Value Per Share Rs. १७३२।६२

Price Earnings Ratio १४।५५ Liquidity Ratio ३३।०४

Net Worth Per Share Rs. १६०।५१

2. Management Analysis:

(a) Despite a decrease in the bank's net interest income and an increase in employee expenses, amortization and depreciation expenses, and non-operating expenses; net profit has shown growth compared to the same quarter of the previous year due to increases in net fee and commission income, net trading income, other operating income, and non-operating income, along with some decrease in other operating expenses and a reduction in loan loss provisions.

(b) In line with the bank's objective of diversifying business and providing quality service, plans are in place to expand banking access in rural areas through branches opened in remote local levels, Branch Less Banking, Extension Counters, and various digital service channels, as well as to increase customer-oriented new services and facilities as needed, making customer service delivery more efficient, prompt, and of higher quality.

Condensed Consolidated Statement of Comprehensive Income

Tier 1 Capital to RWA - 9.37% - 9.09%

CET 1 Capital to RWA - 9.37% - 9.09%

Notes to the Interim Financial Statements

1. Above financials have been prepared in accordance with Nepal Accounting Standards comprising of Nepal Financial Reporting Standards and Nepal Accounting Standard.

2. All Lease contracts have been accounted for as per NFRS 16. Accordingly, Right of Use Assets and Lease Liabilities have been recognised along with Right of Use Assets being dep

3. The Bank has prepared financial statements applying appropriate accounting judgement that are prudent and reasonable as having potential material impact on the financial stateme with NFRS requirements and consistently applied in comparative period also.

4. Previous Period figures have been regrouped/rearranged/restated wherever necessary which might vary from previous quarterly published figures.

5. Loans and Advances include accrued interest receivables and staff advances and are presented net of impairment loss.

6. Above financials have been prepared in accordance with Expected Credit Loss Related Guidelines issued by Nepal Rastra Bank.

7. Interest income has been recognized as per Guidance Note on Interest Income Recognition, 2025 issued by NRB.

8. Above figures are subject to change upon otherwise instructions of Statutory Auditor and/or Regulatory Authorities.

9. The detail interim report has been published in the Bank's website www.ctznbank.com

Related Party Disclosures

1. Group financial statement includes Citizens Bank International Limited (Parent Company), Citizens Capital Limited and Citizens Share Broker Limited (Subsidiary Companies) and A

2. All intra group transactions are conducted on arm's length basis.

3. An agreement has been entered between the Bank and the Subsidiary Companies to provide facilities like technical assistance, internal auditing, legal consulting, RTS Service.

4. All intra group transactions have been excluded in Group Financial Statement.

5. All transaction with Key Management Personnels (Directors and Executive Management staffs) are conducted as per Articles of Association and Employee Bylaws of the Bank.

(C) According to the current information, there are no conditions that could have a material impact on the Bank's liquidity, profit, or cash flow.

3. Details Regarding Legal Proceedings:

(A) If any case was filed by or against the Bank during this period:

During this period, ८ cases were filed on behalf of the Bank. It appears that ४९ cases are filed against the Bank.

(B) If any case has been filed regarding violation of prevailing rules or criminal offenses by or against the Bank's promoters or directors:

No information has been received in this regard.

(C) If any case has been filed regarding financial crimes against any promoter or director:

No information has been received in this regard.

4. Analysis Regarding Share Transactions of the Corporate Body:

(A) Management's view regarding the Bank's share transactions in the securities market:

In line with the high volatility observed in the share trading of corporate bodies in the country's securities market, there has been a slight decrease in the Bank's share transactions compared to the previous quarter.

(B) Maximum, minimum, closing price, total trading days, and total number of transactions of shares during this period:

The details of the maximum, minimum, closing price, total trading days, and number of transactions during this period are as follows:

Maximum Price Rs. २९१।३० Total Traded Share Quantity २,८९६,६०३

Minimum Price Rs. १८६।०० Total Trading Days ६४

Quarter-end Closing Price Rs. १९६।९० Total Number of Transactions ९,८९७

5. Problems and Challenges:

(A) Internal Problems and Challenges

In the existing context where there are internal problems and challenges such as increasing operating expenses of the Bank, increasing net interest income by expanding the interest spread within regulatory base rate and premium standards, income diversification, improving loan quality and managing non-performing loans, reduction in distributable profit due to regulatory adjustments, identifying appropriate investment sectors, operational risk management, and identifying and managing inherent risks in information technology, it remains challenging to continuously improve the Bank's overall indicators in the long run.

(B) External Problems and Challenges

Due to the increasing trend of non-performing loans and loan loss provisioning, and the legal and procedural complexities seen in recovering such non-performing loans, managing NPLs has been extremely challenging. Under such challenging circumstances, sluggish demand for credit in the market despite comfortable liquidity in the banking sector, intense competition, flight of skilled human resources from the banking sector, emerging new types of challenges in information technology, slowdown in real estate business, legal and social complications in loan recovery are the major external problems. In the face of such existing problems, it is challenging to sustainably expand the Bank's business, maintain asset quality, and provide reasonable returns to investors.

(C) Strategy

The Bank has adopted a strategy to bring unbanked individuals and institutions from rural and remote areas into the banking sphere, increase deposit mobilization, expand business by aggressively marketing other bank services, provide banking facilities through modern technology and software without requiring customers to physically visit the bank, develop new technology-based services in a timely manner, provide customer-oriented services quickly and efficiently to build harmonious relations with various business institutions and individual clients, solve the aforementioned challenges by strengthening the fundamental aspects of overall risk management, automate internal working systems to make them paperless, achieve set targets through cost efficiency, and make customer service facilities prompt and effective. Furthermore, the Bank has also adopted a policy to increase loan business, prioritize credit quality, properly manage non-performing loans, accrued interest, overdue borrowers, non-banking assets, and deferred tax assets to increase distributable profit.

6. Corporate Governance:

(A) To enhance corporate governance, the Bank has established a Compliance Department and Governance Unit to strengthen and systematize internal control systems, and is always active in implementing suggestions and directions given by auditors and regulatory bodies through management.

(B) To strengthen the Bank's overall risk management function, analyze and manage IT Risk emerging across the market in the current context, minimize operational risk, and streamline internal processes, a Risk Management Committee has been formed. An Audit Committee has been constituted to review and advise on regularity, economy, efficiency, effectiveness, and propriety in the Bank's operations. An Anti-Money Laundering Committee has been formed to analyze the Bank's overall compliance status, assess customer risk levels, and issue appropriate directives to rectify identified weaknesses. Credit risk monitoring and analysis has been separated from market management operations by establishing a dedicated department under the Risk Management Committee. Additionally, internal policies, rules, and guidelines related to operations of various departments have been issued and implemented. To make decision-making prompt and efficient, various committees including Executive Committee, Asset Liability Management Committee (ALCO), and IT Steering Committee are actively functioning at the management level.

(C) The Bank's Board of Directors and Management are always vigilant and committed to safeguarding the interests of shareholders, the general public, depositors, and all stakeholders, as well as maintaining corporate governance.

7. Declaration by the Chief Executive Regarding Truthfulness and Accuracy:

I personally assume responsibility for the accuracy of the information and details mentioned in this report up to this date. Furthermore, I declare that to the best of my knowledge and belief, the details mentioned in this report are true, factual, and complete, and no details, notices, or information necessary for investors to make informed decisions have been concealed.

Chief Executive Officer