Muktinath Bikas Bank Reports Double Digit Profit Growth in Fourth Quarter
12th August 2026, Kathmandu
Muktinath Bikas Bank Limited, one of the leading national level development banks in Nepal, has published its unaudited financial statements for the fourth quarter of the last fiscal year.
Muktinath Bank Profit Growth
The bank reported encouraging financial performance characterized by double digit growth in net profit alongside positive momentum in core operating income streams. Despite navigating a challenging macroeconomic environment and broader banking sector headwinds, the development bank maintained its focus on business expansion, credit portfolio management, and nationwide financial inclusion.
Growth in Net Profit and Operating Income Performance
The bank recorded a 12.44 percent increase in net profit during the review period compared to the previous fiscal year. In the prior fiscal year, Muktinath Bikas Bank generated a net profit of 1.35 billion Rupees. Driven by expanding business activities and effective interest yield management, net profit rose to 1.51 billion Rupees by the close of the recent fiscal year.
The core revenue generated from interest earnings also demonstrated positive growth. The bank net interest income increased by 3.63 percent, moving from 4.57 billion Rupees to 4.74 billion Rupees.
On the other hand, non interest revenue channels experienced minor contractions. The bank net fee and commission income declined slightly from 55.81 crore Rupees to 54.98 crore Rupees. Despite the modest drop in fee based earnings, the total operating income of the financial institution expanded from 5.19 billion Rupees to 5.39 billion Rupees highlighting overall revenue resilience.
Per Share Metrics and Non Performing Loan Trends
While overall net profit expanded in absolute terms, earnings per share experienced a slight downward adjustment due to the increase in capital base. Earnings per share declined marginally from 19.16 Rupees in the previous fiscal year to 18.98 Rupees at the end of the fourth quarter. Meanwhile, the net worth per share of the development bank stood firmly at 161.82 Rupees.
A major focus area in the recent quarterly report centers on asset quality and credit risk management. The non performing loan ratio of Muktinath Bikas Bank increased significantly from 2.97 percent to 4.77 percent during the review period. The rise in non performing loans reflects heightened credit default risks and general economic slowdown affecting borrower repayment capacity across retail, microfinance, and commercial sectors.
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Furthermore, the bank reported a sharp contraction in its distributable profit figure. The distributable profit dropped dramatically from 1.35 billion Rupees down to 6.757 million Rupees. The significant decline in distributable profit restricts immediate dividend distribution flexibility for the upcoming fiscal review.
Capital Structure Reserves and Balance Sheet Position
Muktinath Bikas Bank expanded its paid up capital base to support long term business growth and fulfill regulatory requirements. The paid up capital rose from 7 billion Rupees to 8 billion Rupees.
The reserve fund maintained by the institution also registered a marginal increase during the review period. Total reserve allocations grew from 3.40 billion Rupees to 3.41 billion Rupees. The expansion in capital resources provides the institution with an adequate capital buffer to absorb credit shocks and pursue prudent lending growth.
Deposit Collection and Credit Portfolio Expansion
In terms of business scale and market reach, the bank continued to adjust its balance sheet mix between credit delivery and deposit mobilization. As part of its lending operations, Muktinath Bikas Bank expanded its total loan portfolio from 97.22 billion Rupees to approximately 100.50 billion Rupees.
Conversely, deposit mobilization experienced a slight contraction over the twelve month period. Total customer deposits held by the bank moved down marginally from 117.43 billion Rupees to 117.33 billion Rupees. The modest reduction in deposits reflects changing interest rate dynamics and liquidity management across the financial system.
Summary of Institutional Performance and Market Outlook
The fourth quarter financial results of Muktinath Bikas Bank present a mixed financial profile for the recently concluded fiscal year. On one hand, double digit profit growth, expanding total operating income, solid net interest margins, and a growing loan portfolio exceeding 100 billion Rupees demonstrate underlying business strength and market leadership among national level development banks. On the other hand, the escalation in non performing loans toward 4.77 percent and the sharp drop in distributable profit highlight ongoing operational challenges that require focused recovery efforts, strict risk management, and strategic capital allocation in the coming fiscal year.
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