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.


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

 


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

 

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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

 


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

 


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]


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]


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]


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]


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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8 thoughts on “Financial Analysis of Commercial Banks of Nepal 2077

  • August 26, 2019 at 3:04 am
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    Very nice and praiseworthy analysis.thanks.

    Reply
  • September 14, 2019 at 2:59 pm
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    Found all the needed information. Very good work.

    Reply
  • July 24, 2020 at 7:06 am
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    Quite satisfied from this website, thnks🙏🙏🙏

    Reply
  • July 29, 2020 at 8:25 am
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    Every info are mentioned, Very helpful site Thank you!

    Reply
  • August 29, 2020 at 8:24 am
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    Nepal investment bank ko reserve & surplus namileko ho ki??

    Reply
    • August 29, 2020 at 9:15 am
      Permalink

      Reserve and Surplus includes general reserve, retained earnings and share premium.

      Reply
  • August 29, 2020 at 11:32 am
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    This analytical article is very helpful for students, bankers and share investers by which they can take right decision.

    Reply
  • November 8, 2020 at 2:51 am
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    I m satisfied with this report

    Reply

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