In the second quarter of the current FY, most of the microfinance companies recorded a huge decline in profit while more than one dozen companies incurred losses.
Out of 55 companies that published second-quarter financial reports, 46 have registered a decline in profit while only nine improved their profit.
The profit of the companies declined by an average 48.84 percent compared to the corresponding period of the last FY. Moreover, 14 companies have incurred losses.
The main reason for the profit decline is due to problems in recovery of loans which has also raised their non-performing loans.
Sana Kisan Laghubitta Logs Highest Profit
In the review period, Sana Kisan Laghubitta earned Rs 442.4 million in profit which is the highest among the microfinance companies. the net profit grew by 1.73 percent compared to the review period of the last FY.
Similarly, Chhimek Laghubitta earned Rs 430 million which is 21 percent degrowth compared to the last FY. Jivan Bikas Laghubitta earned 170 million profit, Deprosc Laghubitta earned 120 million and National Microfinance earned Rs 100 million.
The net profit earned by all other microfinance companies is less than Rs 100 million.
14 Microfinance Companies Incur Loss
Out of 55 microfinance companies, 14 companies have incurred loss during the period. Shrijanshil Laghubitta logged the highest loss of Rs 140 million while NMB Laghubitta and Aviyan Laghubitta incurred Rs 60 million loss.
Increasing NPL=Degrading Reports
The failure to recover loans has raised their NPL. The huge increase in NPL has cut off their profit with a big margin. Shrijanshil Laghubitta has the highest NPL of 18.14 percent while Support Microfinance has the lowest NPL of 1.54 percent.
