• Saturday, Sep 25, 2021
  • Last Update : 01:09 am

Banks see higher H1'21 operating profit despite pandemic

  • Published at 07:45 pm July 3rd, 2021
Profit
Representation photo BIgstock

Lenders were able to make a compelling profit through investments in the capital market during the first half of the current year

Despite the disruptions caused by the ongoing Covid-19 pandemic, Bangladeshi banks have seen a rise in operating profits within the first six months of this year.

There are currently 60 banks in Bangladesh.  

According to the data of twenty banks, lenders were able to make a compelling profit through investments in the capital market during the first half of the current year. 

The banks had also received adequate fees and commissions, as imports and exports increased dramatically, strengthening the foreign exchange segment.

Lower interest rate on deposits and adequate lending rates also contributed to the banks’ profits, according to the official of one such private bank. 


Also Read - Bank squeeze depositors in hunt for profit


According to data from the central bank, the interest rate on savings declined sharply compared to the rates offered on loans, with a handful of banks offering a 3-4 % interest rate on deposits, whereas a rate of 7-8% is offered on loans.

The interest rate spread, as the gap between lending and deposit rates stood at 3.26 percentage points in May, contrast to 2.94 percentage points a year ago, data from the central bank showed.

However, according to an official of Bangladesh Bank (BB), numerous banks might have inflated the profit by accounting for unrealized interests as incomes.

This means that even though some banks had not received installment payments from borrowers, they had accounted income from loan interests, as borrowers who did not pay installments have not been categorized as defaulters. 

Earlier, the central bank had granted deferral support to borrowers by providing borrowers extra time to pay loan installments and to be not categorized as defaulters until the extended period of support. 

The final amount of profit would be a little higher or lower, according to bank officials, as the financial institutions have to set aside funds for provisioning bad debts and paying taxes.

Islami Bank Bangladesh saw the highest profit of Tk1,020 crore in the first half of 2021. In contrast it had witnessed a profit of Tk1,007 crore during the same period last year.

Meanwhile, the lowest profit was posted by Meghna Bank with Tk70 crore. In contrast it had witnessed a profit of Tk12 crore within the same period last year.

72
Facebook 70
blogger sharing button blogger
buffer sharing button buffer
diaspora sharing button diaspora
digg sharing button digg
douban sharing button douban
email sharing button email
evernote sharing button evernote
flipboard sharing button flipboard
pocket sharing button getpocket
github sharing button github
gmail sharing button gmail
googlebookmarks sharing button googlebookmarks
hackernews sharing button hackernews
instapaper sharing button instapaper
line sharing button line
linkedin sharing button linkedin
livejournal sharing button livejournal
mailru sharing button mailru
medium sharing button medium
meneame sharing button meneame
messenger sharing button messenger
odnoklassniki sharing button odnoklassniki
pinterest sharing button pinterest
print sharing button print
qzone sharing button qzone
reddit sharing button reddit
refind sharing button refind
renren sharing button renren
skype sharing button skype
snapchat sharing button snapchat
surfingbird sharing button surfingbird
telegram sharing button telegram
tumblr sharing button tumblr
twitter sharing button twitter
vk sharing button vk
wechat sharing button wechat
weibo sharing button weibo
whatsapp sharing button whatsapp
wordpress sharing button wordpress
xing sharing button xing
yahoomail sharing button yahoomail