2024-07-03 18:38:07
Depositors are losing confidence in the country’s banks due to various irregularities and corruption. On the other hand, banks are in liquidity crunch. In such a situation, at the end of June 30 of this year, the operating profit of the banks has increased compared to the same period of the previous year. On Monday (July 1), it was found out after checking several banks.
Most of the country’s banks are listed in the capital market. Every quarter (after three months) banks have to submit their unaudited financial reports to Bangladesh Bank and capital market regulator Bangladesh Securities and Exchange Commission (BSEC) and stock exchanges. Before this, the company’s board of directors approves their financial reports. The report is then published by stock exchanges on their websites for investors. In continuation of this, Monday (July 1) was a bank holiday for the preparation of the half-yearly report till June 30. Banks have consolidated their half-yearly accounts for the period up to June 30 today. As per rules, listed banks cannot officially report operating profit before submitting financial reports to stock exchange, BSEC, Bangladesh Bank. However, the operating profit information of several banks has been found by searching. There, the operating profit of most of the banks has increased compared to the same period of the previous year.
State-owned Sonali Bank is among the banks whose operating profit has increased. In 2024 (from January to June) the bank has made an operating profit of Tk 2,260 crore. The bank’s profit in the first six months of 2023 was Tk 1,680 crore. Rupali Bank made a profit of Tk 450 crore; 320 crores during the same period last year.
Among private banks, Southeast Bank’s operating profit in the first six months of the year was 579 crores. The bank had posted a profit of Rs 407 crore in the same period last year. The operating profit of the bank has increased by Tk 172 crore during the mentioned period. Social Islami Bank Plc (SIBL) made an operating profit of Tk 211 crore. Last year the bank’s operating profit was Tk 200 crore.
The fourth generation Madhumati Bank made an operating profit of Tk 180 crore in the first six months of 2024; 81 crores profit in the same period last year. Union Bank’s profit is Tk 250 crores. The previous year was Tk 210 crore.
Apart from the increase in the interest rate of the bank’s loans, the operating profit of the banks has increased due to various charges, commissions and treasury income. However, operating profit is not the ultimate profit of the bank. A provision is to be kept as per the loan value from the operating profit; 37 and a half percent corporate tax has to be paid if listed in the capital market. After that the net or actual profit is finalised.
While talking to the managing director and chief executive officer of a commercial bank, he said on the condition of anonymity that the operating profit has increased a lot this year. The main reason for this is that interest rates have increased a lot. Many loans have almost doubled. Income from treasury bonds has improved this time. Apart from this, the profit has also increased from various charges and commissions. Overall, operating profit has increased this year.
According to the data of Bangladesh Bank, the total amount of disbursed loans of the banking sector at the end of March 2024 stood at 16 lakh 40 thousand 855 crores. Out of this, the default amount is Tk 1 lakh 82 thousand 295 crore, which is 11.11 percent of the total disbursed loans.
According to calculations, defaulted loans in the country have increased by 50 thousand 675 crores in one year, of which 36 thousand 367 crores have increased in three months. A year ago in March 2023 it was Tk 1 lakh 31 thousand 620 thousand crore and last December it was Tk 1 lakh 45 thousand 633 crore.
Meanwhile, at the beginning of the financial year 2023-24, Bangladesh Bank introduced the Six Months Moving Average Rate of Treasury Bill or ‘Smart’ method to determine the interest rate of bank loans. But before the end of the financial year, it failed and Bangladesh Bank canceled the smart interest system. On May 8 this year, it issued a notification leaving the loan interest rate entirely up to the market. According to Bangladesh Bank, the banks can determine the loan interest rate based on demand and supply. In this case, the bank-customer relationship can also be taken into consideration. Since then, the loan interest rate has been increasing.