20th April 2025, Kathmandu
Rastriya Banijya Bank (RBB) has published its third-quarter financial report for fiscal year 2080/81. The report shows the bank earned a net profit of NPR 1.20 billion by the end of Chaitra.
Rastriya Banijya Bank Q3 Results
Compared to the previous fiscal year, this figure represents a 49.29% decline. In the same period last year, RBB had reported a profit of NPR 2.37 billion.
Drop in Core Income
The bank’s net interest income also decreased. It fell from NPR 7.97 billion last year to NPR 7.10 billion this year. This drop shows pressure on the bank’s core lending and interest-earning activities.
At the same time, RBB’s operating profit was cut almost in half. It dropped from NPR 3.37 billion to NPR 1.69 billion. While the bank managed to maintain overall operations, the total operating income stood at NPR 6.35 billion.
These figures indicate that rising costs or reduced margins affected overall profitability.
Negative Distributable Profit
During the review period, the bank recorded a negative distributable profit of NPR 1.02 billion. This means RBB may not be able to provide dividends to its shareholders unless profits improve in the upcoming quarter.
This negative figure is a key concern for investors and stakeholders.
Rise in Non-Performing Loans
Another issue was the increase in non-performing loans (NPLs). The bank’s NPL ratio reached 4.69% by the end of Q3. This means a growing portion of its loans are at risk of default.
Rising NPLs suggest the bank is facing challenges in credit recovery and asset quality management. It also increases pressure on future provisioning.
Growth in Deposits and Lending
Despite weaker profits, RBB’s deposit collection rose from NPR 429 billion to NPR 461 billion. This growth shows that customers still trust the bank to safeguard their savings.
On the lending side, RBB disbursed NPR 280 billion in loans. The increase in credit activity shows the bank’s commitment to financing sectors of the economy, even in challenging times.
Capital Strength Remains Solid
RBB’s capital base stayed strong. Its paid-up capital reached NPR 15.63 billion, and the reserve fund grew to NPR 37.40 billion. These figures provide the bank with a financial cushion to manage risks and support long-term operations.
Although profit declined, the solid capital structure indicates the bank’s overall financial stability remains intact.
Outlook
The sharp drop in profit and rise in NPLs have raised concerns. However, the bank’s strong deposit base and capital strength offer some reassurance. RBB will need to focus on improving asset quality and reducing operational costs in the coming months.
With only one quarter remaining in the fiscal year, the bank must act quickly to stabilize earnings and improve performance. Investors and policymakers will be watching closely.
For more: Rastriya Banijya Bank Q3 Results