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Most banks see EPS rise in first quarter

  • Published at 09:26 pm May 15th, 2019

Banking sector insiders have claimed that nonperforming loans are now under control and the banks are now abiding by the rules set by the central bank

Earnings per share (EPS) of 70% of listed banks increased during the first quarter (January-March) of the year 2019 on what it was in the same period the previous year.

The EPS is the company's profit allocated to each share of a listed firm, indicating a company's profitability.

Banking sector insiders have claimed that nonperforming loans are now under control and the banks are now abiding by the rules set by the central bank.

According to Bangladesh Bank data, at the end of December 2018, the total amount of defaulted loans in the banking sector stood at Tk93,911.40 crore or 10.30% of the total outstanding loans.

According to banks’ disclosure posted on the website of Dhaka Stock Exchange (DSE), of the 30 listed banks, 21 banks' EPS rose while nine banks have registered negative growth in January-March period compared to the same period last year.

As per its unaudited financial statement, Exim Bank registered the highest growth by 215% in   the first quarter and the EPS stood at Tk0.45, which was negative at Tk0.39 in the same period a year ago.

On the other hands, AB Bank has seen the highest fall in EPS by 38% to Tk0.10, which was Tk0.16 in the same period last year.

Exim Bank managing director and CEO Mohammed Haider Ali Miah told Dhaka Tribune: “The recovery team has been strengthened. The default loan has decreased. There is no more new investment, but income has increased due to nursing of old investments.”

This period, most of the banks' earning is better because of minimized problems in banking sectors and better recovery from their defaulters. Besides, the banks are now abiding by the rules set by the central bank, Pubali Bank Managing Director and CEO MA Halim Chowdhury told Dhaka Tribune.

Pubali Bank's EPS rose by 20% to Tk0.84 in January-March in this year, which was Tk0.70 last year.

According to the DSE information, the consolidated EPS of Uttara Bank rose by 141% to Tk0.94 from Tk0.39, that of The City Bank by 108% to Tk0.79 from Tk0.38, IFIC Bank by 74% to Tk0.47 from Tk0.27, Eastern Bank by 70% to Tk1.17 from Tk0.69 and Jamuna Bank by 64% to Tk0.74 from Tk0.45.

The Standard Bank's consolidated EPS was Tk0.12 for January-March 2019 as against Tk0.08 last year. First Security Islami Bank's EPS was Tk0.60 for Q1 as against Tk0.40 for the same period last year.

Shahjalal Islami Bank's EPS rose by 49% to Tk0.55 from 0.37, Premier Bank's by 46% to Tk0.57 from Tk0.39, National Bank's by 45% to Tk0.16 from Tk0.11, UCB's by 42% to Tk0.44 from Tk0.31, Prime Bank's EPS rose by 19% to Tk0.37 from Tk0.31 and Bank Asia's by 17% to Tk0.62 from Tk0.53.

Al-Arafah Islami Bank's consolidated EPS was Tk0.45 for January-March 2019 as against Tk0.39 for the period in 2018, Rubali Bank's EPS was Tk0.25 for Q1 as against Tk0.22 for the period previous year.

Mutual Trust Bank's EPS rose by 12% to Tk0.73 from Tk0.65, Islami Bank's by 11% to Tk0.40 from Tk0.36, NCC Bank's rose by 10% and Dhaka Bank's by 8% to Tk0.53 from Tk0.49.

Dutch-Bangla Bank's EPS declined by 26%, Mercantile Bank's by 22%, Southeast Bank's by 20%, One Bank's by 19%, Trust Bank's by 8%, Brac Bank's 5% and Social Islami Bank's by 3%.   

ICB Islamic Bank has continued to incur losses. The bank's per share loss increased by 26% to Tk0.16 from Tk0.13.

However, analysts said the unaudited EPS of a company often does not reflect actual financial health of a listed firm, but indicates profitability that influences investors towards their long-term investment.