Nabil Bank Reports Stable Q1 Results: Profit Declines but Asset Quality Strengthens

Kathmandu — Nabil Bank Limited has reported a slight decline in profit for the first quarter of fiscal year 2082/83 compared to the same period last year. As of the end of Ashoj, the bank earned a net profit of NPR 1.75 billion, a 14.57% decrease from NPR 2.05 billion in the previous year.

The decline in interest income led to an overall reduction in total income. The bank’s net interest income fell by 5.77% to NPR 3.09 billion from NPR 4.14 billion a year earlier. This was mainly due to lower lending rates and slower credit expansion. However, net fees and commission income rose by 6.29% to NPR 798.7 million, offering partial support to total operating income, which nonetheless fell by 1.03% to NPR 5.27 billion. Operating profit declined by 10.84% to NPR 2.58 billion.

In terms of balance sheet growth, customer deposits reached NPR 556.61 billion, up by 6.10% from the previous year’s end, while loans increased by 1.99% to NPR 421 billion.

The bank’s distributable profit stood at NPR 5.63 billion, while earnings per share (EPS) fell to NPR 25.97 from NPR 29.83. Interestingly, distributable EPS improved to NPR 30.15, suggesting stronger long-term payout potential.

Nabil Bank’s net worth per share reached NPR 240.72, and its capital adequacy ratio remained steady at 12.67%. Notably, its non-performing loan (NPL) ratio improved to 0.97% from 1.42%, showing enhanced asset quality. The base rate dropped to 5.58%, with an interest spread of 3.51%, indicating easing interest rate conditions in the market.

Overall, Nabil Bank has maintained stability in deposits and credit growth while improving asset quality. However, pressure on interest income led to lower profitability. Analysts expect that a rebound in lending activities and interest rates in the coming quarters could strengthen its dividend distribution capacity.