The evaluation is conducted taking into account paid-up capital, reserve fund, deposits, lending, net interest income, operating income, net profit, EPS, non-performing loans, net worth per share, P/E ratio, book value per share and return on equity of the banks.
In the study, NIC Asia topped the list, followed by Nabil Bank. Similarly, Everest Bank, Himalayan Bank, Global IME Bank, Agriculture Development Bank, Nepal Investment Bank, Rastriya Banijya Bank, NMB Bank and Nepal Bank followed the top banks successively.
(Note: The top bank in the list of 27 commercial banks is given 27 points and the bank at the bottom is given 1 point, the top 10 banks are selected by the cumulative points of all 13 indicators)
In the second quarter, although NIC Asia topped in operating profit and Return on Equity (ROE) only, the bank topped the list on the basis of the average of all 13 indicators. The bank is in the second position in terms of deposit collection, loan extensions and EPS.
During the period, Global IME Bank that merged Janata Bank logged growth in indicators like paid-up capital, deposit collection and loan extension while it lies behind in EPS, P/E ratio, net worth and ROE.
Similarly, in recent times, Nepal Investment Bank has also lost its spark. The bank that dominated the overall sector in the past has lost its top position and has landed in 7th spot. The bank lagged behind in indicators like non-performing loans, ROE, P/E ratio and others.
Rastriya Banijya Bank, that earned the highest net profit in the second quarter is at 8th spot. The bank is the only non-listed bank of the country. With the non-listing status, indicators like P/E ratio, book value per share could not be calculated, thus, the bank has landed at the bottom of the list.
Likewise, Nepal Bank that is in the 10th position has the highest reserve fund. The bank lagged behind in indicators like ROE, book value per share and P/E ratio.
Moreover, although Nabil Bank could not take the top spot in any indicator, it is in a comfortable position in overall indicators. Meanwhile, Everest Bank that is cautious on the recovery of bad debt seems falling behind in P/E ratio. Everest Bank logged the lowest non-performing loans among the commercial banks.
Let’s go through some major indicators;
Net Profit and EPS
In the second quarter, government-owned Rastriya Banijya Bank is in the first position. The bank is followed by Nabil, NIC Asia, Himalayan, Global IME, Nepal Investment, NMB, Agriculture Development, Everest and Nepal Bank in successive order
Rastriya Banijya Bank leads other banks in EPS while NMB Bank logged the 10th position
Net worth and non-performing loan
In the second quarter, Nepal Bank records the highest net worth per share while Everest Bank has the lowest non-performing loans.
Paid-up Capital and Reserve
Global IME has the highest paid-up capital. Meanwhile, Nepal Bank has the highest reserve fund.
Deposits and Loans
Global IME Bank tops the list of Deposit collection and loan extensions
Net interest income and operating income
In the second quarter, Rastriya Banijya Bank earned the highest net interest income while NIC Asia Bank has the highest operating income.
(Note: The indicators are calculated as per the second-quarter financial report published by respective banks; P/E and PBV is calculated on the basis of the stock price on February 13)
