Mahalaxmi Bank Profit Jumps 48.46 Percent in FY 2025 26 as Earnings and Operating Income Rise

5th August 2026, Kathmandu

Mahalaxmi Development Bank Limited has published its unaudited fourth-quarter financial results for the fiscal year 2025/26, reporting strong growth in net profitability along with positive performance across major operational indicators.

Mahalaxmi Bank Profit Jumps

The national-level development bank recorded a 48.46 percent year-on-year surge in net profit, reaching Rs 629.9 million compared to Rs 424.3 million earned during the corresponding period of the previous fiscal year.

The sharp rise in net earnings demonstrates robust core banking activities, enhanced operational efficiency, and sustained revenue generation across its national branch network.

Net Interest Income and Operating Income Expansion

The primary core revenue stream of the institution, net interest income, increased by 10.69 percent to exceed Rs 2.14 billion during the review period, up from Rs 1.94 billion reported in the previous fiscal year.

Non-interest revenue streams also demonstrated steady upward momentum during the financial year:

• Net fee and commission income expanded from Rs 206.5 million to over Rs 230.4 million
• Total operating income rose by 9.54 percent to exceed Rs 2.48 billion, compared to Rs 2.27 billion recorded in the prior year

The overall expansion in operating revenue provided a solid foundation for higher profitability and supported ongoing investment in customer service and operational infrastructure.

Operating Profit and Distributable Profit Growth

Driven by higher total operating income and efficient expense management, operating profit surged by 53.41 percent to reach over Rs 937.9 million, compared to Rs 611.4 million in the previous fiscal year.

The distributable profit of the bank also improved during the period, rising by 4.40 percent from Rs 445.6 million to Rs 465.2 million.

The growth in distributable profit strengthens the financial capability of the development bank to offer attractive dividend distributions to its shareholders, subject to regulatory approvals from Nepal Rastra Bank and approval at the annual general meeting.

Per Share Metrics and Credit Risk Indicators

With the substantial growth in net profit, the earnings per share of Mahalaxmi Development Bank increased significantly to Rs 13.96, up from Rs 9.88 per share reported in the previous fiscal year.

The net worth per share of the institution stood at Rs 165.42 at the end of the fourth quarter, reflecting a strong equity backing for investors.

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However, asset quality metrics showed some pressure during the review period, as the non-performing loan ratio rose from 4.98 percent to 6.32 percent, indicating elevated credit risk amidst broader economic recovery dynamics in Nepal.

On the interest rate front, the base rate of the bank declined notably from 6.94 percent to 5.66 percent, lowering borrowing costs for credit customers and supporting future loan demand.

Capital Base, Lending Portfolio, and Customer Deposits

Mahalaxmi Development Bank strengthened its financial foundation by expanding its paid-up capital from Rs 4.29 billion to Rs 4.51 billion during the fiscal year.

The total reserve fund of the financial institution also expanded, exceeding Rs 2.48 billion by the end of the fourth quarter.

Core lending and deposit operations reflected steady credit expansion despite minor fluctuations in deposit mobilization:

• Loans and advances increased from Rs 41.51 billion to Rs 43.34 billion, reflecting steady credit deployment to commercial, industrial, and personal borrowing sectors
• Customer deposits registered a marginal decline from Rs 55.11 billion to Rs 55.01 billion

Despite the slight contraction in customer deposit balances, the bank successfully expanded its overall loan portfolio while maintaining strong liquidity and capital adequacy standards.

Comprehensive Comparison of Key Financial Highlights

The performance indicators for the fourth quarter of FY 2025/26 compared to FY 2024/25 highlight key operational shifts:

• Net Profit: Rs 629.9 million in FY 2025/26 compared to Rs 424.3 million in FY 2024/25, representing an increase of 48.46 percent
• Net Interest Income: Over Rs 2.14 billion in FY 2025 26 compared to Rs 1.94 billion in FY 2024 25, representing an increase of 10.69 percent
• Net Fee and Commission Income: Over Rs 230.4 million in FY 2025 26 compared to Rs 206.5 million in FY 2024 25
• Total Operating Income: Over Rs 2.48 billion in FY 2025 26 compared to Rs 2.27 billion in FY 2024 25, representing an increase of 9.54 percent
• Operating Profit: Over Rs 937.9 million in FY 2025 26 compared to Rs 611.4 million in FY 2024 25, representing an increase of 53.41 percent
• Distributable Profit: Rs 465.2 million in FY 2025 26 compared to Rs 445.6 million in FY 2024 25, representing an increase of 4.40 percent
• Earnings Per Share: Rs 13.96 in FY 2025 26 compared to Rs 9.88 in FY 2024 25
• Non-Performing Loan Ratio: 6.32 percent in FY 2025 26 compared to 4.98 percent in FY 2024 25
• Base Rate: 5.66 percent in FY 2025 26 compared to 6.94 percent in FY 2024 25
• Net Worth Per Share: Rs 165.42 in FY 2025 26
• Paid-Up Capital: Rs 4.51 billion in FY 2025 26 compared to Rs 4.29 billion in FY 2024 25
• Total Loans and Advances: Rs 43.34 billion in FY 2025 26 compared to Rs 41.51 billion in FY 2024 25
• Customer Deposits: Rs 55.01 billion in FY 2025 26 compared to Rs 55.11 billion in FY 2024 25

Strategic Market Positioning and Future Financial Outlook

The financial results for the fourth quarter of FY 2025 26 demonstrate that Mahalaxmi Development Bank Limited has achieved a significant increase in profitability, driven by core interest revenue and operational profit expansion.

While managing asset quality and recovering non-performing loans will remain crucial priorities for management in the coming fiscal year, the bank remains well-capitalized with a growing reserve fund, lower base rates, and improved dividend capacity.

With solid financial fundamentals, an expanded equity base, and strong market presence among national-level development banks in Nepal, Mahalaxmi Development Bank is well-positioned to maintain sustainable operational growth and deliver long-term value to its depositors and shareholders.

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