11 August 2024, Kathmandu
Forward Microfinance Financial Institution Limited has reported an outstanding financial performance for the past year.
Forward Microfinance Profit Surge
With net profit surging by an impressive 308.72% to Rs. 320.14 million, compared to Rs. 78.63 million the previous year. This substantial increase highlights the company’s significant growth in profitability.
Key financial metrics reflect this robust performance. Net interest income grew by 8% to Rs. 1.22 billion from Rs. 1.13 billion, indicating strong earnings from lending activities. The impairment charge, which represents potential losses from bad loans, decreased by 28.54% to Rs. 385.98 million, showcasing improved asset quality and risk management. Operating profit saw a dramatic rise of 299.41%, reaching Rs. 463.53 million, up from Rs. 116.54 million, demonstrating enhanced operational efficiency and revenue generation.
Total operating income increased by 14.54% to Rs. 1.41 billion, while net operating income surged by 48% to Rs. 1.28 billion. However, the distributable profit experienced a decrease of 48.73% to Rs. 266.5 million. Despite this, earnings per share (EPS) significantly rose from Rs. 7.45 to Rs. 30.45, reflecting higher profitability on a per-share basis. The company’s net worth per share stands at Rs. 288.96, with a price-to-earnings (P/E) ratio of 46.41 times and a liquidity ratio of 6.98%.
On the downside, the proportion of bad loans increased from 4.26% to 6.81%, indicating a need for enhanced credit quality control. Forward Microfinance’s paid-up capital is Rs. 1.56 billion, with retained earnings at Rs. 26.65 million and reserves growing by 49.66% to Rs. 1.72 billion. Customer loans rose by 4.20% to Rs. 19.90 billion, and deposits increased by 6.50% to Rs. 8.96 billion, reflecting ongoing growth and stability in the company’s financial position.
About Microfinance
Forward Microfinance Financial Institution Limited is a prominent microfinance institution based in Nepal, dedicated to providing financial services to underserved communities. The organization focuses on supporting low-income individuals and small businesses that lack access to traditional banking services, aiming to enhance economic opportunities and promote financial inclusion.
Forward Microfinance offers a range of financial products tailored to meet the needs of its clients. These include micro-loans, which are small-scale loans designed to help individuals and small enterprises start or expand their businesses. By offering loans with minimal collateral requirements, Forward Microfinance empowers clients to engage in entrepreneurial activities and improve their livelihoods.
In addition to microloans, Forward Microfinance provides savings accounts with low minimum deposit requirements, allowing clients to build financial security and manage their resources more effectively. The institution also offers micro-insurance products to safeguard clients against various risks, such as health issues or asset loss, providing them with greater stability and protection.
Forward Microfinance Profit Surge