Rupali Bank profit goes up 16% on investment return
But its net interest income was Tk198.56 crore negative
The net profit of Rupali Bank Ltd has increased 16% in the first half of 2021 although the financial institution reported a decrease in its net interest income.
The bank made good performance in the investment income.
It posted an interest income of Tk1,092.46 crore, which is 11% higher than the same period of 2020.
But the net interest income was Tk198.56 crore negative.
The principal activities of the bank are to provide all kinds of commercial banking and related services such as accepting deposits, lending loans to customers, local and international trade and services, treasury functions and investment such as capital market, cash management, securities and custody services, remittance services and mobile banking services.
According to the first half of 2021, the investment income of the company was Tk653.18 crore, which was Tk541.12 crore in the same period of 2020.
Its total operating income was Tk581.85 crore, which is 9% higher compared to the period of 2020.
In the first half of 2021, the bank made a total provision of Tk70 crore, which was Tk104 crore in the same period of 2020.
Its earnings per share was Tk0.43, which was Tk.37 in the same period of a year ago.
Rupali Bank Ltd was listed on the Dhaka Stock Exchange in 1986.
The government held 90.19%, institutional investors 4.81% and general investors 5% shares of the company.
The last trading price of the company's shares at the Dhaka Stock Exchange was Tk33.90 each on Thursday.
Most banks have reported moderate operating profits in the pandemic in the first six months of this year mainly on the back of a spread between lending and deposit interest rates and a lower provision against defaulted loans.
According to the central bank, the average interest rate on bank deposits in the first six months of last year was around 5.5-6%. But from January to April this year, the rate came down below 4.5%. If the interest rate on the loan is 9%, the spread has increased by 1.5-2%.
Bankers say most banks have invested their excess liquidity in treasury bonds due to low demand for loans. The lenders have received massive profits from there. Again, due to the closure of loan classification as a result of the pandemic, banks have had to keep much fewer reserves (provision) against loans than usual.