Financial Analysis of Commercial Banks of Nepal 2077

August 25, 2020 | Investopaper

All 27 commercial banks of Nepal have published the unaudited fourth quarter report of the fiscal year 2076/77. The report shows the fall in profitability of the banks. This is mainly due to the impact of COVID-19 in the economy followed by the lockdown enforced by the government as the preventive measure. With the increased provision for possible losses for several banks, the net profit declined.

Here, we have made an exclusive study of the financial performance of the 27 commercial banks of Nepal. We have ranked the banks in terms of different financial indicators.

Disclaimer

This report is based on the un-audited fourth-quarter report of the fiscal year 2076/77 published by the respective banks. After the audit, the numbers along with the ranking may vary.

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PAID-UP CAPITAL OF COMMERCIAL BANKS OF NEPAL

Paid-up capital is the money provided by the shareholders into the company since the establishment. It includes the initial fund accumulated from the shareholders plus additional capital injected through right/ bonus shares or FPO as the company moves forward. Higher the capital, the greater the financial strength of the company. In times of economic difficulty, companies with huge capital tend to survive than companies with low capital.

All the commercial banks in Nepal have met the capital requirement of Rs. 8 Arba as directed by the central bank. The total capital of the commercial banks stands at Rs. 284.83 Arba until the Ashad end, 2077. So, the average capital of the banks is Rs. 10.55 Arba. 8 commercial banks have the capital above the average. Likewise, the remaining 9 banks have the capital below Rs. 10.55 Arba.

Global IME Bank has the highest capital of Rs 18.98 Arba. Similalry, Agricultural Development Bank has the capital of Rs. 14.99 Arba. However, it includes the preference share worth Rs. 5.43 Arba. Likewise, Nepal Investment Bank has the capital of Rs. 14.25 Arba.

See the ranking of the 27 commercial banks based on capital until the end of the fiscal year 2076/77 in the table below:

Paid Up Capital of Commercial Banks of Nepal

		Paid up capital(Rs.’Arba’)
Rank	Commercial Banks	Ashad end, 2077	Ashad end, 2076	Percent Change
1	Global IME Bank	18.98	10.31	84.09
2	Agricultural Development Bank	14.99	14.45	3.74
3	Nepal Investment Bank	14.25	12.87	10.72
4	Prime Commercial Bank	13.99	9.32	50.11
5	NMB Bank	13.95	9.62	45.01
6	Mega Bank	13.14	10.39	26.47
7	Kumari Bank	12.52	8.69	44.07
8	Nepal Bank	11.28	9.81	14.98
9	Prabhu Bank	10.32	8.89	16.09
10	Nabil Bank	10.1	9.01	12.10
11	Laxmi Bank	9.81	8.92	9.98
12	Siddhartha Bank	9.79	8.89	10.12
13	NIC Asia Bank	9.72	8.83	10.08
14	Himalayan Bank	9.37	8.52	9.98
15	NCC Bank	9.35	7.02	33.19
16	Citizens Bank	9.09	8.37	8.60
17	Rastriya Banijya Bank	9	9	0.00
18	Sunrise Bank	8.97	8.15	10.06
19	Nepal SBI Bank	8.96	8.45	6.04
20	Sanima Bank	8.8	8	10.00
21	Bank Of Kathmandu	8.55	8.06	6.08
22	Everest Bank	8.51	8.11	4.93
23	Nepal Bangladesh Bank	8.5	8.09	5.07
24	Machhapuchchhre Bank	8.46	8.06	4.96
25	Century Commercial Bank	8.42	8.42	0.00
26	Standard Chartered Bank	8.01	8.01	0.00
27	Civil Bank	8	8	0.00
	Total Paid-Up Capital	284.83	244.26
	Average Paid-Up Capital	10.55	9.05

Note: The paid-up capital of Agricultural Development Bank includes the preference share worth Rs 5.43 Arba.

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RESERVE & SURPLUS OF COMMERCIAL BANKS OF NEPAL

Reserve (& Surplus) along with the capital determine the financial strength of the company. It is also the part of the shareholders’ fund which is not distributed. It includes a general reserve, retained earnings and share premium (if the shares are sold at a premium rate). Higher the reserve and surplus, the greater the strength.

The commercial banks of Nepal have accumulated total reserve and surplus of Rs. 195.54 Arba until the end of the fiscal year 2076/77. The average reserve & surplus stands at Rs. 7.24 Arba. Nine banks have reserves higher than the average. Likewise, the remaining 18 banks have reserve below Rs. 7.24 Arba.

Nepal Bank occupies the top spot with a total reserve of Rs. 18.90 Arba. Similarly, Nabil Bank  has a reserve & surplus of Rs. 15.7 Arba followed by Rastriya Banijya bank with Rs. 14.44 Arba. Century Commercial Bank, Civil Bank, and Machhapuchchhre Bank have the lowest reserve with Rs. 1.95 Arba, Rs. 2.07 Arba, and Rs. 3.11 Arba respectively.

The table below shows the ranking of the 27 commercial banks based on the total reserve and surplus until the end of 2076/77.

Reserve of Commercial Banks of Nepal

		RESERVE & Surplus  ( in Rs. Arba)
RANK	Commercial Banks	Ashad end, 2077	Ashad end, 2076	Percent Change
1	Nepal Bank	18.9	19.47	-2.93
2	Nabil Bank	15.7	14.18	10.72
3	Rastriya Banijya Bank	14.44	12.58	14.79
4	Agricultural Development Bank	13.47	13.9	-3.09
5	Nepal Investment Bank	13.07	12.71	2.83
6	Everest Bank	10.11	9.52	6.20
7	Global IME Bank	10.04	6.02	66.78
8	Himalayan Bank	8.17	7.47	9.37
9	NIC Asia Bank	7.52	6.1	23.28
10	Standard Chartered Bank	7.09	6.92	2.46
11	Prime Commercial Bank	6.56	4.08	60.78
12	Siddhartha Bank	6.19	6.14	0.81
13	NMB Bank	5.92	7.78	-23.91
14	Nepal SBI Bank	5.79	5.71	1.40
15	Bank Of Kathmandu	5.76	5.9	-2.37
16	Prabhu Bank	5.29	5.43	-2.58
17	Nepal Bangladesh Bank	4.6	4.33	6.24
18	Kumari Bank	4.57	3.03	50.83
19	Sunrise Bank	4.56	4.12	10.68
20	Mega Bank	4.46	3.12	42.95
21	Citizens Bank	4.28	4.12	3.88
22	Laxmi Bank	4.14	3.73	10.99
23	Sanima Bank	3.95	3.99	-1.00
24	NCC Bank	3.83	4.99	-23.25
25	Machhapuchchhre Bank	3.11	3.18	-2.20
26	Civil Bank	2.07	2.15	-3.72
27	Century Commercial Bank	1.95	1.58	23.42
	Total Reserve & Surplus	195.54	182.25
	Average Reserve & Surplus	7.24	6.75

Note: Reserve & Surplus includes general reserve, retained earnings and share premium

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DEPOSITS OF COMMERCIAL BANKS OF NEPAL

27 Commercial Banks have collected Rs. 33.75 Kharba as the deposits from customers until the end of the fiscal year 2076/77. The average deposit of banks is Rs. 124.99 Arba. Thirteen Banks have deposit collection above the average.

 Rastriya Banijya Bank has the highest deposit collection of Rs. 230.83 Arba followed by Global IME Bank with Rs. 212.32 Arba. NIC Asia Bank has the deposits of Rs. 201.63 Arba and is at number 3 in terms of deposit collection. Civil Bank has the lowest deposits among the commercial banks. The deposits of Civil Bank stand at Rs. 57.51 Arba only.

The table below presents the ranking of the 27 commercial banks based on total deposits from customers until the fiscal year 2076/77.

Deposits of Commercial Banks of Nepal

		Deposits From Customers (Rs.’Arba’)
S.N	Commercial Banks	Ashad end, 2077	Ashad end, 2076	Percent Change
1	Rastriya Banijya Bank	230.83	189.26	21.96
2	Global IME Bank	212.32	120.09	76.8
3	NIC Asia Bank	201.63	171.43	17.62
4	Nabil Bank	190.81	162.95	17.1
5	Nepal Investment Bank	166.36	149.39	11.36
6	Agricultural Development Bank	143.65	118.88	20.84
7	Everest Bank	143.55	129.57	10.79
8	Nepal Bank	142.11	117.2	21.25
9	Siddhartha Bank	139.61	114.92	21.48
10	NMB Bank	131.66	97.89	34.5
11	Prabhu Bank	128.49	105.49	21.8
12	Mega Bank	127.89	78.68	62.54
13	Himalayan Bank	125.26	109.39	14.51
14	Prime Commercial Bank	119.44	77.04	55.04
15	Kumari Bank	116.55	73.2	59.22
16	Nepal SBI Bank	110.45	97.92	12.8
17	Sanima Bank	106.84	89.37	19.55
18	Machhapuchchhre Bank	104.1	85.2	22.18
19	Laxmi Bank	100.86	80.34	25.54
20	Standard Chartered Bank	98.47	75.73	30.03
21	Bank Of Kathmandu	92.1	82.72	11.34
22	Sunrise Bank	90.22	75.43	19.61
23	Citizens Bank	88.52	70.51	25.54
24	NCC Bank	73.79	65.98	11.84
25	Nepal Bangladesh Bank	66.44	56.23	18.16
26	Century Commercial Bank	65.34	60.28	8.39
27	Civil Bank	57.51	41.99	36.96
	Total Deposits From Customers	3374.8	2697.08
	Average Deposits Of Commercial Banks	124.99	99.89

 

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LOANS AND ADVANCES OF COMMERCIAL BANKS OF NEPAL

Commercial banks of Nepal have floated the loans and advances of Rs. 27.82 Kharba in total to the customers. The average lending of each bank stands at Rs. 103.04 Arba. 13 banks have total lending higher than the average. Global IME Bank, NIC Asia Bank, and Rastriya Banijya Bank occupy the top 3 spots with loans of Rs. 189.39 Arba, Rs. 160.19 Arba and Rs. 150.81 Arba respectively.

Similarly, Civil Bank, Standard Chartered Bank and Century Commercial Bank have the lowest loan portfolio among the commercial banks. Civil bank has floated only Rs. 51.51 Arba in loans. Likewise, SCB has total loans and advances of Rs. 53.91 Arba. Similarly, Century Bank has provided total loans and advances of Rs. 58.04 Arba until the end of the Ashad, 2077.

See the ranking of the 27 commercial banks based on loans and advances in the fiscal year 2076/77 in the table below:

Loans and Advances of Commercial Banks of Nepal

		Loans & Advances To Customers (Rs.’Arba’)
Rank	Commercial Banks	Ashad end, 2077	Ashad end, 2076	Percent Change
1	Global IME Bank	189.39	108.98	73.78
2	NIC Asia Bank	160.19	142.57	12.36
3	Rastriya Banijya Bank	150.81	142.02	6.19
4	Nabil Bank	148.23	127.5	16.26
5	Nepal Investment Bank	135.46	122.87	10.25
6	Siddhartha Bank	123.45	104.88	17.71
7	Agricultural Development Bank	123.05	108.81	13.09
8	NMB Bank	115.7	88.49	30.75
9	Everest Bank	112.19	104.64	7.22
10	Kumari Bank	111.09	73.02	52.14
11	Mega Bank	110.6	69.86	58.32
12	Prime Commercial Bank	110.45	72.55	52.24
13	Nepal Bank	104.59	92.42	13.17
14	Himalayan Bank	101.65	92.7	9.65
15	Prabhu Bank	99.69	85.82	16.16
16	Machhapuchchhre Bank	92.34	75.1	22.96
17	Sanima Bank	90.57	81.42	11.24
18	Nepal SBI Bank	89.62	84.39	6.2
19	Laxmi Bank	89.44	74.62	19.86
20	Sunrise Bank	81.04	68.87	17.67
21	Citizens Bank	79.17	62.91	25.85
22	Bank Of Kathmandu	75.92	70.48	7.72
23	NCC Bank	65.11	60.85	7
24	Nepal Bangladesh Bank	58.97	52.52	12.28
25	Century Commercial Bank	58.04	57.09	1.66
26	Standard Chartered Bank	53.91	53.09	1.54
27	Civil Bank	51.51	42.59	20.94
	Total Loans & Advances	2782.18	2321.06
	Average Loans Of Commercial Banks	103.04	85.97

Note: The loans and advances includes loan to customers only. This doesn’t include the loans provided to other BFIs.

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NET INTEREST INCOME OF COMMERCIAL BANKS OF NEPAL

Net interest income is the major source of income of the banks. It is the difference between the interest income from loans and interest expenses on deposits. Commercial Banks, in total, have earned Rs. 128.76 Arba as the net interest income in the fiscal year 2076/77. The average net interest income stands at Rs. 4.77 Arba.

Ten banks have a net interest income greater than the average. Whereas 17 banks have below-average net interest income. Rastriya Banijya Bank, Global IME Bank, and NIC Asia Bank are the top 3 banks in terms of net interest income. RBB has the highest net interest income of Rs. 9.32 Arba. Likewise, Global IME and NIC Asia have earned Rs. 8.19 Arba and Rs. 7.6 Arba as the net interest income.

Civil Bank, Nepal Bangladesh Bank and Century Commercial Bank occupy the lowest spots in the net interest income. Civil, Nepal Bangladesh Bank and Century Bank have net interest income of Rs. 2.24 Arba, Rs. 2.84 Arba and Rs.2.86 Arba respectively.

The table below shows the ranking of the 27 commercial banks based on net interest income until the fiscal year 2076/77.

Net Interest Income of Commercial Banks of Nepal

		Net Interest Income (Rs. ‘In Arba)
RANK	Commercial Banks	Ashad end, 2077	Ashad end, 2076	Percent Change
1	Rastriya Banijya Bank	9.32	9.95	-6.33
2	Global IME Bank	8.19	5.24	56.30
3	NIC Asia Bank	7.6	6.96	9.20
4	Nabil Bank	7.02	7.16	-1.96
5	Agricultural Development Bank	6.24	7.61	-18.00
6	Nepal Investment Bank	5.76	6.17	-6.65
7	Nepal Bank	5.62	6.19	-9.21
8	Siddhartha Bank	5.59	4.67	19.70
9	NMB Bank	5.53	4.24	30.42
10	Everest Bank	5.31	5.7	-6.84
11	Himalayan Bank	4.76	5.03	-5.37
12	Prabhu Bank	4.65	4.4	5.68
13	Prime Commercial Bank	4.62	3.58	29.05
14	Nepal SBI Bank	4.25	4.71	-9.77
15	Sanima Bank	4.22	4.21	0.24
16	Mega Bank	4.17	3.8	9.74
17	Sunrise Bank	3.88	3.58	8.38
18	Machhapuchchhre Bank	3.86	3.55	8.73
19	Kumari Bank	3.63	2.87	26.48
20	Bank Of Kathmandu	3.58	3.79	-5.54
21	Standard Chartered Bank	3.51	3.52	-0.28
22	Laxmi Bank	3.41	3.17	7.57
23	NCC Bank	3.22	2.97	8.42
24	Citizens Bank	2.88	2.69	7.06
25	Century Commercial Bank	2.86	2.59	10.42
26	Nepal Bangladesh Bank	2.84	2.91	-2.41
27	Civil Bank	2.24	2.2	1.82
	Total Net Interest Income	128.76	123.46
	Average Net Interest Income	4.77	4.57

 

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OPERATING PROFIT OF COMMERCIAL BANKS OF NEPAL

Operating Profit refers to the profit earned through the company’s business operation. It excludes deductions of interest and taxes. Sometimes, Operating Profit is referred to as operating income. Operating profit is a useful measure of profitability than the net profit. This is because it doesn’t include a one-time profit which causes a surge in the net profit. So, it is a more dependable indicator to measure the profitability of the business for the year.

Commercial banks have have earned Rs. 75.94 Arba as the operating profit in the fiscal year 2076/77.  Rastriya Banijya Bank leads the commercial banks with an operating profit of Rs. 6.03 Arba. Nabil Bank is second with the operating profit of Rs. 5.09 Arba. The average operating profit of the banks is Rs. 2.81 Arba. 12 commercial banks have an operating profit above the industrial average. Whereas, 15 banks have an operating profit below the average i.e Rs. 2.81 Arba.

See the ranking of the commercial banks based on the operating profit in the fiscal year 2076/77 in the table below:

Operating Profit of Commercial Banks of Nepal

		Operating Profit (Rs.’Arba’)
Rank	Commercial Banks	Ashad end, 2077	Ashad end, 2076	Percent Change
1	Rastriya Banijya Bank	6.03	6.47	-6.80
2	Nabil Bank	5.09	6.03	-15.59
3	NIC Asia Bank	4.47	4.51	-0.89
4	Agricultural Development Bank	4.46	5.34	-16.48
5	Global IME Bank	4.41	3.91	12.79
6	Nepal Investment Bank	3.63	4.49	-19.15
7	Nepal Bank	3.57	4.51	-20.84
8	Everest Bank	3.57	4.35	-17.93
9	Himalayan Bank	3.35	3.94	-14.97
10	Prime Commercial Bank	3.27	3.15	3.81
11	Siddhartha Bank	3.07	3.28	-6.40
12	Standard Chartered Bank	2.84	3.48	-18.39
13	NMB Bank	2.43	3.25	-25.23
14	Sanima Bank	2.42	3.22	-24.84
15	Nepal SBI Bank	2.2	3.12	-29.49
16	Laxmi Bank	2.15	2.29	-6.11
17	Mega Bank	2.15	2.33	-7.73
18	Bank Of Kathmandu	2.12	2.74	-22.63
19	Prabhu Bank	2.09	2.27	-7.93
20	Sunrise Bank	1.97	2.55	-22.75
21	Machhapuchchhre Bank	1.91	2.4	-20.42
22	Nepal Bangladesh Bank	1.8	2.27	-20.70
23	Kumari Bank	1.75	1.77	-1.13
24	NCC Bank	1.74	1.96	-11.22
25	Citizens Bank	1.45	2.1	-30.95
26	Century Commercial Bank	1.23	1.03	19.42
27	Civil Bank	0.67	1.17	-42.74
	Total Operating Profit	75.84	87.93
	Average Operating Profit Of Banks	2.81	3.26

 

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NET PROFIT OF COMMERCIAL BANKS OF NEPAL

Commercial Banks in Nepal have earned a net profit of Rs. 54.3 Arba in total in the fiscal year 2076/77. The average net profit of the banks is Rs. 2.01 Arba. Twelve commercial banks have earned a profit above the average Rs. 2.01 Arba. Likewise, 15 banks have earned below the industrial average.

Rastriya Banijya Bank, Nabil Bank, and Agricultural Development Bank occupy the top 3 spots in the net profit with profit above Rs. 3 Arba. Rastriya Banijya Bank has made a huge net profit of Rs. 4.45 Arba followed by Nabil Bank and Agricultural Development Bank with Rs. 3.57 Arba and Rs. 3.47 Arba as the net profit respectively.

See the ranking of the commercial banks based on the net profit in the fiscal year 2076/77 in the table below:

Net Profit of Commercial Banks of Nepal

		Net Profit (Rs.’Arba’)
Rank	Commercial Banks	FY 2076/77	FY 2075/76	Percent Change
1	Rastriya Banijya Bank	4.45	5.05	-11.88
2	Nabil Bank	3.57	4.24	-15.8
3	Agricultural Development Bank	3.47	4.19	-17.18
4	NIC Asia Bank	3.12	3.02	3.31
5	Global IME Bank	3.09	2.76	11.96
6	Nepal Investment Bank	2.57	3.32	-22.59
7	Nepal Bank	2.56	2.6	-1.54
8	Himalayan Bank	2.54	2.76	-7.97
9	Everest Bank	2.5	3.05	-18.03
10	Prime Commercial Bank	2.29	2.2	4.09
11	NMB Bank	2.27	2.26	0.44
12	Siddhartha Bank	2.09	2.26	-7.52
13	Standard Chartered Bank	1.98	2.43	-18.52
14	Sanima Bank	1.7	2.26	-24.78
15	Nepal SBI Bank	1.53	2.29	-33.19
16	Mega Bank	1.52	1.63	-6.75
17	Laxmi Bank	1.48	1.59	-6.92
18	Bank Of Kathmandu	1.48	1.9	-22.11
19	Sunrise Bank	1.39	1.71	-18.71
20	Prabhu Bank	1.37	1.78	-23.03
21	Machhapuchchhre Bank	1.25	1.7	-26.47
22	Nepal Bangladesh Bank	1.24	1.59	-22.01
23	Kumari Bank	1.22	1.23	-0.81
24	NCC Bank	1.13	1.02	10.78
25	Citizens Bank	1.12	1.46	-23.29
26	Century Commercial Bank	0.91	0.68	33.82
27	Civil Bank	0.46	0.71	-35.21
	Total Net Profit	54.3	61.69
	Average Net Profit	2.01	2.28

 

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DISTRIBUTABLE PROFIT OF COMMERCIAL BANKS OF NEPAL

The distributable profit refers to the profit that is finally available for distribution to the shareholders in the form of dividends. Investors can make a general assumption about the expected dividend from the distributable profit. In total, the commercial banks have earned Rs. 31.29 Arba which they can distribute to the shareholders.

The average distributable profit of the banks is Rs. 1.16 Arba. Ten banks have a distributable profit above the average. Likewise, 17 banks have below-average distributable profit. Nabil Bank leads in terms of distributable profit with Rs. 3.04 Arba. Nepal Bank and Global IME Bank have a distributable profit of Rs. 2.21 Arba and Rs. 1.73 Arba respectively.

See the ranking of the commercial banks based on the distributable profit in the fiscal year 2076/77 in the table below:

Distributable Profit of Commercial Banks of Nepal

		Distributable Profit (Rs.’Arba’)
S.N.	Commercial Banks	FY 2076/77	FY 2075/76	Percent Change
1	Nabil Bank	3.04	3.18	-4.40
2	Nepal Bank	2.21	3.45	-35.94
3	Global IME Bank	1.73	2.43	-28.81
4	Everest Bank	1.67	2.19	-23.74
5	Agricultural Development Bank	1.67	3.31	-49.55
6	Prime Commercial Bank	1.62	1.6	1.25
7	Standard Chartered Bank	1.52	1.8	-15.56
8	NIC Asia Bank	1.44	2.15	-33.02
9	NMB Bank	1.43	1.27	12.60
10	Himalayan Bank	1.31	2.02	-35.15
11	Laxmi Bank	1.13	1.16	-2.59
12	Sanima Bank	1.12	1.63	-31.29
13	Mega Bank	1.12	1.36	-17.65
14	Prabhu Bank	1.08	1.73	-37.57
15	Rastriya Banijya Bank	1.04	3.62	-71.27
16	Nepal SBI Bank	0.99	1.6	-38.13
17	Machhapuchchhre Bank	0.91	1.32	-31.06
18	Bank Of Kathmandu	0.88	1.3	-32.31
19	Siddhartha Bank	0.87	1.65	-47.27
20	Citizens Bank	0.82	1.12	-26.79
21	Kumari Bank	0.71	0.97	-26.80
22	NCC Bank	0.7	1.2	-41.67
23	Nepal Investment Bank	0.65	1.39	-53.24
24	Sunrise Bank	0.53	1.12	-52.68
25	Nepal Bangladesh Bank	0.45	1.04	-56.73
26	Century Commercial Bank	0.4	0.54	-25.93
27	Civil Bank	0.25	0.56	-55.36
	Total Distributable Profit	31.29	46.71
	Average Distributable Profit	1.16	1.73

 

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EARNING PER SHARE (EPS) OF COMMERCIAL BANKS OF NEPAL

Earning per share (EPS) is one of the important financial indicators of the company. It measures the profitability of the company. EPS is calculated by dividing net profit by the number of outstanding shares or common stock of the company.

Among commercial banks, Rastriya Banijya Bank has the highest EPS of Rs 49.44. Nabil Bank and ADBL have EPS of Rs 37.24 and Rs 32.88 respectively.

The average EPS of the commercial banks in Nepal is Rs 20.33. Nine banks have EPS above the industry average while the remaining 16 banks have below average EPS.

The table below shows the ranking of the 27 commercial banks based on Earnings Per Share (EPS):

Earnings Per Share (EPS) of Commercial Banks of Nepal 

		Earnings Per Share, EPS(Rs.)
S.N.	Commercial Banks	FY 2076/77	FY 2075/76
1	Rastriya Banijya Bank	49.44	59.17
2	Nabil Bank	37.24	47.65
3	Agricultural Development Bank	32.88	44.67
4	NIC Asia Bank	32.13	34.56
5	Everest Bank	31.15	37.95
6	Himalayan Bank	27.13	33.41
7	Standard Chartered Bank	24.76	31.15
8	Nepal Bank	22.66	27.15
9	Siddhartha Bank	21.38	26.59
10	Sanima Bank	19.35	28.04
11	Nepal Investment Bank	18.07	26.54
12	Bank Of Kathmandu	17.26	24.04
13	Nepal SBI Bank	17.09	27.26
14	NMB Bank	16.73	24.09
15	Prime Commercial Bank	16.39	25.38
16	Global IME Bank	16.27	27.11
17	Sunrise Bank	15.53	20.94
18	Laxmi Bank	15.13	17.67
19	Nepal Bangladesh Bank	15.01	20.02
20	Machhapuchchhre Bank	14.78	21.15
21	Mega Bank	14.52	16.55
22	Prabhu Bank	13.93	24.18
23	Citizens Bank	12.92	17.79
24	Kumari Bank	12.77	15.36
25	NCC Bank	12.09	23.58
26	Century Commercial Bank	10.77	10.23
27	Civil Bank	5.71	9.5
	Average EPS Of Commercial Banks	20.11	26.73

 

Related: Earnings Per Share (EPS) Of 27 Commercial Banks In Nepal [Updated]

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NET-WORTH PER SHARE 

Net-worth refers to the value of the company left after deducting all the liabilities. It is calculated by subtracting total liabilities from the total assets. When the total net worth is divided by the number of outstanding shares, we get the net-worth per share. Higher the net-worth per share of the bank, greater the financial strength. From an investors point of view, owning companies with higher net-worth per share is a more safe investment strategy.

The average net-worth per share of the banks of Nepal is Rs. 171.18. Nepal Bank has the highest net-worth per share of Rs. 267.50. Likewise, the Rastriya Banijya Bank and Nepal Bank have Rs. 260.44 and Rs 255.45  net-worth per share respectively. Civil Bank has the lowest net-worth per share of Rs. 125.85.

See the ranking of the commercial banks based on the net-worth per share in the table below:

Networth Per Share of Commercial Banks of Nepal

		Net worth per share (Rs.)
RANK	COMMERCIAL BANK	Ashad end, 2077
1	Nepal Bank	267.50
2	Rastriya Banijya Bank	260.44
3	Nabil Bank	255.45
4	Agricultural Development Bank	237.54
5	Everest Bank	219.84
6	Nepal Investment Bank	192.00
7	Standard Chartered Bank	188.50
8	Himalayan Bank	187.20
9	NIC Asia Bank	177.36
10	Bank Of Kathmandu	167.44
11	Nepal SBI Bank	164.67
12	Siddhartha Bank	163.22
13	Nepal Bangladesh Bank	154.15
14	Global IME Bank	152.90
15	Prabhu Bank	151.29
16	Sunrise Bank	150.86
17	NMB Bank	149.57
18	Citizens Bank	147.08
19	Prime Commercial Bank	146.91
20	Sanima Bank	144.83
21	Laxmi Bank	142.20
22	NCC Bank	140.91
23	Machhapuchchhre Bank	136.80
24	Kumari Bank	136.47
25	Mega Bank	133.99
26	Century Commercial Bank	126.76
27	Civil Bank	125.85
	Average Per Share Networth	171.18

 

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DIVIDEND PAYING CAPACITY OF COMMERCIAL BANKS OF NEPAL

Investors are waiting for the dividend declaration of the banks. The average dividend-paying capacity of the banks stands at 11.37 percent from fiscal year. This means that investors can expect returns in the form of dividends ranging from 15 to 20 percent. Nabil Bank has the highest dividend paying capacity of 30.1 percent. Everest Bank is second to Nabil with the 19.62 percent dividend paying capacity.

Note:

• It doesn’t include the distributable reserve from the previous years. Hence, the dividend announcement may be higher
• This is the maximum distributable amount from the profit of the fiscal year 2076/77. The banks can distribute less dividend.
• Dividend payout depends upon the decision of the board of directors of the respective banks.

See the ranking of the commercial banks based on the dividend-paying capacity in the table below:

Dividend Paying Capacity of Commercial Banks of Nepal

		DIVIDEND PAYING CAPACITY(%)
RANK	COMMERCIAL BANK	Ashad end, 2077	Ashad end, 2076	Percent Change
1	Nabil Bank	30.1	35.29	-14.71
2	Everest Bank Ltd.	19.62	27	-27.33
3	Nepal Bank Ltd.	19.59	35.17	-44.30
4	Standard Chartered Bank	18.98	22.47	-15.53
5	Agricultural Development Bank Ltd.	17.47	36.7	-52.40
6	NIC Asia Bank	14.81	24.35	-39.18
7	Himalayan Bank Ltd. (HBL)	13.98	23.71	-41.04
8	Sanima Bank Ltd.	12.73	20.38	-37.54
9	Prime Commercial Bank	11.58	17.17	-32.56
10	Rastriya Banijya Bank	11.56	40.22	-71.26
11	Laxmi Bank Ltd.	11.52	13	-11.38
12	Nepal SBI Bank Ltd.	11.05	18.93	-41.63
13	Machhapuchre Bank Ltd.	10.76	16.38	-34.31
14	Prabhu Bank Ltd.	10.47	19.46	-46.20
15	Bank of Kathmandu	10.29	16.13	-36.21
16	NMB Bank	10.25	13.2	-22.35
17	Global IME Bank Ltd.	9.11	23.57	-61.35
18	Citizens International Bank Ltd.	9.02	13.38	-32.59
19	Siddhartha Bank Ltd.	8.89	18.56	-52.10
20	Mega Bank Nepal Ltd.	8.52	13.09	-34.91
21	Nepal Credit and Commerce Bank	7.49	17.09	-56.17
22	Sunrise Bank Ltd.	5.91	13.74	-56.99
23	Kumari Bank Ltd.	5.67	11.16	-49.19
24	Nepal Bangladesh Bank	5.29	12.86	-58.86
25	Century Commercial Bank	4.75	6.41	-25.90
26	Nepal Investment Bank	4.56	10.8	-57.78
27	Civil Bank Ltd.	3.13	7	-55.29
	Average Dividend Paying Capacity	11.37	19.53

 

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BASE RATE 

Base rate refers to the minimum standard rate below which the commercial banks are not allowed to lend. In other words, the base rate is the cost of doing the banking business. Banks in Nepal provide the loans at a certain premium above the base rate. Higher base rate results in higher lending rates. Hence, the low base rate is more favorable for the banks.

At Ashad end 2077, the average base rate of the commercial banks of Nepal is 8.5 percent. Eleven commercial banks are operating with a base rate below the average. On the other hand, 16 banks have a high base rate. Rastriya Banijya Bank is the bank with the lowest base rate of 5.8 percent. Likewise, Kumari Bank have the highest base rate of 10.08 percent.

See the ranking of the commercial banks of Nepal based on the base rate in the table below:

Base rate of Commercial Banks of Nepal

		Base rate(%)
Rank	Commercial Banks	Ashad end, 2077	Ashad end, 2076	Percent Change
1	Rastriya Banijya Bank	5.8	5.5	5.45
2	Nepal Bank	6.99	7.98	-12.41
3	Standard Chartered Bank	7	7.63	-8.26
4	Nabil Bank	7.32	8.09	-9.52
5	Nepal Investment Bank	7.51	8.33	-9.84
6	NIC Asia Bank	7.7	9.48	-18.78
7	Everest Bank	8.05	8.12	-0.86
8	Prabhu Bank	8.32	9.36	-11.11
9	Mega Bank	8.32	9.98	-16.63
10	Himalayan Bank	8.38	9.05	-7.4
11	Global IME Bank	8.42	9.54	-11.74
12	Prime Commercial Bank	8.62	10.03	-14.06
13	Sanima Bank	8.62	9.45	-8.78
14	Nepal Bangladesh Bank	8.62	10.2	-15.49
15	Bank Of Kathmandu	8.71	9.98	-12.73
16	NMB Bank	8.95	9.86	-9.23
17	Sunrise Bank	8.95	10.32	-13.28
18	Siddhartha Bank	9.03	10.57	-14.57
19	NCC Bank	9.03	10.23	-11.73
20	Citizens Bank	9.04	10.52	-14.07
21	Machhapuchchhre Bank	9.21	10.37	-11.19
22	Laxmi Bank	9.23	10.26	-10.04
23	Nepal SBI Bank	9.25	9.73	-4.93
24	Agricultural Development Bank	9.26	10.58	-12.48
25	Century Commercial Bank	9.38	11.29	-16.92
26	Civil Bank	9.84	11.11	-11.43
27	Kumari Bank	10.08	10.82	-6.84
	Average Base Rate Of Banks	8.5	9.57

 

Related: Base Rate Of Commercial Banks Of Nepal [Updated]

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NON-PERFORMING LOANS (NPL) 

Non-Performing Loans (NPL) is another major indicator of performance analysis of commercial banks. Lower NPL reflects the higher quality of lending. On the other hand, higher NPL is due to poor lending quality. The average NPL of commercial banks of Nepal is 1.74 percent. Everest Bank is number one based on the NPL with 0.22 percent. Likewise, Nepal SBI Bank has the NPL of 0.23 percent. Standard Chartered Bank is third with 0.44 percent NPL.

The table below presents the ranking of commercial banks based on the NPL:

Non-Performing Loans (NPL) of Commercial Banks of Nepal

		Non Performing Loans, NPL(%)
Rank	Commercial Banks	Ashad end, 2077	Ashad end, 2076	Percent Change
1	Everest Bank	0.22	0.16	37.5
2	Nepal SBI Bank	0.23	0.2	15
3	Standard Chartered Bank	0.44	0.15	193.33
4	Sanima Bank	0.48	0.08	500
5	Machhapuchchhre Bank	0.54	0.37	45.95
6	NIC Asia Bank	0.75	0.46	63.04
7	Nabil Bank	0.97	0.74	31.08
8	Himalayan Bank	1.01	1.12	-9.82
9	Laxmi Bank	1.04	1.2	-13.33
10	Mega Bank	1.2	0.98	22.45
11	Kumari Bank	1.41	0.97	45.36
12	Citizens Bank	1.46	1.13	29.2
13	Prime Commercial Bank	1.54	1	54
14	Siddhartha Bank	1.56	0.75	108
15	Global IME Bank	1.8	0.55	227.27
16	Sunrise Bank	1.86	1.03	80.58
17	Century Commercial Bank	2.21	1.4	57.86
18	Bank Of Kathmandu	2.35	1.54	52.6
19	Civil Bank	2.38	2.37	0.42
20	Nepal Bank	2.59	2.64	-1.89
21	NMB Bank	2.68	0.82	226.83
22	Agricultural Development Bank	2.71	3.29	-17.63
23	NCC Bank	2.79	2.78	0.36
24	Prabhu Bank	2.81	3.76	-25.27
25	Nepal Bangladesh Bank	2.89	1.74	66.09
26	Nepal Investment Bank	2.91	2.78	4.68
27	Rastriya Banijya Bank	4.08	4.79	-14.82
	Average NPL Of Banks	1.74	1.44

 

Related: Non Performing Loans (NPL) Of Commercial Banks In Nepal [Updated]

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Share Price And P/E Ratio Of Commercial Banks

At the end of Ashad 2077, Nabil Bank has the highest share price of Rs 765. On the other hand, Civil Bank has the lowest share price of Rs 139. Similalry, Nepal Bank has the lowest P/E ratio among the banks with 10.99. While Standard Chartered Bank has the highest P/E ratio of 26.05.

The table below shows the share price, EPS and P/E ratio of the commercial banks of Nepal.

Rank	Commercial Banks	Market Price Per Share (Rs.)	Earnings Per Share (EPS)	P/E Ratio
1	Nepal Bank	249	22.66	10.99
2	Agricultural Development Bank	385	32.88	11.71
3	Bank Of Kathmandu	219	17.26	12.69
4	Laxmi Bank	209	15.13	13.81
5	Siddhartha Bank	296	21.38	13.84
6	Nepal Bangladesh Bank	209	15.01	13.92
7	Mega Bank	208	14.52	14.33
8	Citizens Bank	188	12.92	14.55
9	Kumari Bank	186	12.77	14.57
10	Global IME Bank	239	16.27	14.69
11	Machhapuchchhre Bank	220	14.78	14.88
12	Sunrise Bank	234	15.53	15.07
13	Century Commercial Bank	165	10.77	15.32
14	NCC Bank	186	12.09	15.38
15	Prime Commercial Bank	255	16.39	15.56
16	Prabhu Bank	221	13.93	15.87
17	Sanima Bank	330	19.35	17.05
18	NIC Asia Bank	553	32.13	17.21
19	Himalayan Bank	540	27.13	19.90
20	Nabil Bank	765	37.24	20.54
21	Everest Bank	675	31.15	21.67
22	NMB Bank	397	16.73	23.73
23	Nepal Investment Bank	431	18.07	23.85
24	Civil Bank	139	5.71	24.34
25	Nepal SBI Bank	435	17.09	25.45
26	Standard Chartered Bank	645	24.76	26.05
27	Rastriya Banijya Bank		49.44
	Average		20.11	17.19

Note: The share price of Ashad end, 2077

Related: P/E Ratio Of 27 Commercial Banks Of Nepal [Updated]

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Market Capitalization Of Commercial Banks

Market Capitalization refers to the total market value of the company. It is calculated by multiplying the total shares into the share price of the company. Among commercial banks in Nepal, Nabil Bank is the top company with the market value of Rs 77.27 Arba. Nepal Investment Bank and Agricultural Development bank have a market cap of Rs 61.42 Arba and Rs 57.71 Arba respectively.

The table below presents the share price, total listed shares and the market capitalization of the commercial banks in Nepal.

Rank	Commercial Banks	Market Price Per Share (Rs.)	Total Listed Shares (in crores)	Market Capitalization( Rs. Arba)
1	Nabil Bank	765	10.1	77.27
2	Nepal Investment Bank	431	14.25	61.42
3	Agricultural Development Bank	385	14.99	57.71
4	Everest Bank	675	8.51	57.44
5	NMB Bank	397	13.95	55.38
6	NIC Asia Bank	553	9.72	53.75
7	Standard Chartered Bank	645	8.01	51.66
8	Himalayan Bank	540	9.37	50.60
9	Global IME Bank	239.00	18.98	45.36
10	Nepal SBI Bank	435	8.96	38.98
11	Prime Commercial Bank	255	13.99	35.67
12	Sanima Bank	330	8.8	29.04
13	Siddhartha Bank	296	9.79	28.98
14	Nepal Bank	249	11.28	28.09
15	Mega Bank	208	13.14	27.33
16	Kumari Bank	186	12.52	23.29
17	Prabhu Bank	221	10.32	22.81
18	Sunrise Bank	234	8.97	20.99
19	Laxmi Bank	209	9.81	20.50
20	Bank Of Kathmandu	219	8.55	18.72
21	Machhapuchchhre Bank	220	8.46	18.61
22	Nepal Bangladesh Bank	209	8.5	17.77
23	NCC Bank	186	9.35	17.39
24	Citizens Bank	188	9.09	17.09
25	Century Commercial Bank	165	8.42	13.89
26	Civil Bank	139	8	11.12
27	Rastriya Banijya Bank		9	0.00
	Average Market Capitalization Of Banks			33.37

Note: The share price of Ashad end, 2077. Hence, the market capitalization of the banks is of Ashad end, 2077. At current, the numbers along with ranking may vary.

Related: Market Capitalization Of 27 Commercial Banks Of Nepal [Updated]

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Disclaimer:

The above figures are based on the un-audited quarterly report published by the respective company. Investors are advised to take other things into consideration along with this report while making investment decisions. The numbers may vary after the final audit.

Note: If you want to see the individual reports of the companies, Click Here.

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