The increase in interest expense and the decline in net interest income can be attributed to the decline in net profit of the bank.
The bank has earned a net profit of Rs 987.3 milion in the review period. This is a decline of 19.98 percent compared to Rs 1.23 billion of the corresponding period of the previous FY.
The bank's net interest income declined by 23.89 percent to Rs 1.44 billion in the review period from Rs 1.90 billion in the previous FY. Due to the increase in the cost of deposit and loan instruments, the interest expense of the bank increased from Rs 569.1 million to Rs 977.3 million.
The bank has been able to reverse the impairment charge of Rs 212.7 million in the last FY.
Loans to consumer and infrastructure projects increased from Rs 24.94 billion to Rs 31.42 billion. The bank has approved a total loan of Rs 56.13 billion and the amount will be released as per the progress of the project. The bank's deposit collection has increased from Rs 7.68 billion to Rs 7.83 billion.
The total assets of the bank stands at Rs 41.84 billion. The bank's strongest strength is the quality of its loans. The non-performing loan of the bank is zero percent, which is exemplary for the entire banking sector. The bank's cost of funds has come down from 6.51 percent to 6.46 percent. Similarly, the base rate has come down from 6.97 percent to 6.77 percent (average of 6.76 percent in the last three months). The CD ratio of the bank is 79.92 percent.
