AB Bank performed well in the second quarter of 2020 despite the general holiday in April and May imposed to curb the spread of the novel coronavirus.
The bank was open for a short period this quarter, which ended on June 30, but it still made remarkable progress and posted 100 percent growth in net profits. Consolidated earnings per share of the bank stood at Tk0.10 during the second quarter.
In the first half of the 2020 financial year, AB Bank posted 27 percent growth in net profits and its consolidated earnings per share stood at Tk0.19.
However, the bank experienced a major liquidity crisis during the second quarter; it posted a net operating cash flow per share of negative Tk36.81, which means the bank did not have enough money in hand.
Officials of the bank said cash flow was negative due to a fall in loan recoveries amid the general holiday.
AB Bank brings good news for its shareholders as the bank has declared stock dividends for 2019 – though only five percent – after a two-year hiatus.
Bank management described it as a turnaround, linking the achievement to good leadership.
The bank will thus be upgraded to Category B after languishing two years in Category Z in the stock market, giving its shareholders a reason to feel encouraged.
According to the bank's financial statement, as of December last year, classified loans decreased by 41.19 percent to Tk4,683 crore from Tk7,973 crore over the same period a year earlier.
Even the advance to deposit ratio came down to 84.28 percent from 91.09 percent a year ago.
In 2019, the bank's deposits increased to Tk27,946 crore from Tk23,544 crore in the preceding year.
The bank's consolidated earnings per share, which stood at Tk0.16 in 2019, was Tk0.06 in 2018. Net operating cash flow per share increased to Tk37.79, which had been negative Tk9.14 a year earlier.
AB Bank listed on the Dhaka Stock Exchange in 1983. Its paid-up capital is Tk758.13 crore.
In the second quarter of this year, the bank has achieved minimum shareholdings of 30.22 percent by its board, which was 29.25 percent in February.
Out of total shares, the government holds 0.57 percent, institutional investors have 33.07 percent, foreign investors have 1.03 percent, and general investors have 35.11 percent.