Global IME Bank Reports 49.51% Surge in Net Profit
Author
NEPSE trading
Global IME Bank Limited has released its unaudited financial report for the second quarter of FY 2081 (ending Poush). The bank recorded a net profit of NPR 3.05 billion, a significant increase of 49.51% compared to the same period last year. In Poush, 2080, the net profit stood at NPR 2.04 billion.
The primary driver of this profit growth was the reduction in impairment charges, despite a decline in net interest income. The bank reduced its impairment charges from NPR 4.13 billion in the previous year to NPR 2.20 billion, resulting in a substantial boost to its operating profit.
1. Decline in Interest Income but Growth in Profit
The bank's net interest income declined by 8.09% to NPR 8.29 billion compared to last year.
However, net fee and commission income increased by 17.34%, reaching NPR 1.60 billion.
Total operating income saw a slight decline of 4.41%, indicating some pressure on revenue streams.
2. Reduced Operating Costs
The reduction in impairment charges from NPR 4.13 billion to NPR 2.20 billion helped the bank improve its operating profit by 47.88%, reaching NPR 4.20 billion.
This cost optimization significantly contributed to the overall profitability.
3. Growth in Deposits and Loans
By Poush, 2081, the bank had collected NPR 513.98 billion in customer deposits, an increase of 5.44% compared to the same period last year.
Similarly, loans and advances grew by 10.20%, reaching NPR 407.08 billion.
This growth indicates the bank's strong presence in the credit market and its ability to expand its lending operations.
4. Improved Shareholder Returns
The bank's Earnings Per Share (EPS) increased to NPR 16.02, up by 4.71 compared to last year’s NPR 11.31.
Its Net Worth Per Share also improved to NPR 169.58, reflecting better financial stability.
5. Base Rate and Interest Spread
The base rate dropped from 9.60% to 6.95%, creating a favorable environment for cheaper loans.
The interest rate spread remained stable at 3.98%, ensuring consistent margins.
The bank’s paid-up capital reached NPR 38.11 billion, marking a 5.50% increase from last year.
The bank has built a reserve and surplus fund of NPR 26.52 billion, ensuring long-term financial security.
Global IME Bank has shown remarkable improvement in its financial performance for the second quarter of FY 2081. Key achievements include:
A significant reduction in impairment charges,
Growth in fee and commission income,
Optimized operating costs,
And an expansion in deposits and loans.
However, the decline in net interest income highlights the need for the bank to focus on improving its core interest-based revenue streams in the future.
For investors, the rise in net profit, EPS, and financial stability presents an attractive opportunity. Global IME Bank’s robust growth and strategic cost management have solidified its position as a competitive player in the Nepalese banking sector.
This strong performance underlines the bank’s ability to achieve its long-term financial goals while maintaining profitability and delivering value to its stakeholders.
