The country's biggest mobile financial service (MFS) operator bKash, continuing with its growth trajectory, has reported a positive operating profit after 14 quarters and a positive bottom line after a long break of 13 quarters.
According to the latest financial reports, during the third quarter (Q3) of the current year, bKash saw its net profit standing at Tk46.5 crore, which stood at a loss of Tk29.5 crore at the end of Q3 in 2021.
Additionally, bKash's net revenue increased by 27.7% year-on-year (YoY) and gross margin improved by 537 basis points YoY in Q3 of the current year.
On the other hand, bKash's gross revenue in Q3 was Tk975 crores with the gross margin of the company also increasing by 279 basis points quarter-on-quarter.
According to the Tellimer data cited in the research report of IDLC Securities, the 27.7% net revenue growth, 537 basis points improvement in gross margin YoY and 235 basis points YoY decline in operating expenses to net revenue were the main drivers of Tk27.6 crore quarter operating profit.
Another Tk28.5 crore net interest income earned by the MFS operator led to a Tk46.5 crore profit for the fintech service provider at the end of the third quarter of the current year.
The MFS incurred a loss of Tk123 crore in 2021, despite a consistent rise in the number of active customers and revenue due to coordinated investments that were expected to yield higher returns in the future.
Increasing investment in new technologies and services to meet the growing demand had affected its profitability earlier. However, that seems to have come to an end.
“For a growing textbook fintech company, it is crucial to think long term - beyond quarterly shifts - due to the essential investments required to build a robust platform of innovative services,” Head of Corporate Communications of bKash Shamsuddin Haider Dalim told Dhaka Tribune.
“bKash's sustainable business model is always customer-centric. We work relentlessly to expand our platform. Essential technology upgradation and product diversification will remain our prime focus. At this point in time, paying more attention to the facilitation of the digital ecosystem benefits the industry at large,” the top brass further said.
Furthermore, bKash's positive bottom line after a hiatus of 13 quarters, along with Brac Bank's 67% YoY increase in commission, exchange and brokerage income and 38% YoY growth in the consolidated lending portfolio helped Brac Bank to boost its earnings in the latest quarter, stated Tellimer.
Brac Bank reported Tk159 crores of net profit after tax (NPAT) - excluding minority interest-in the third quarter (Q3) of 2022 against Tk141.7 crores reported during the same period last year, implying a 12% YoY growth.
The lending portfolio of the core banking business of Brac Bank reportedly increased by 37% YoY and 23% YTD.
This is more than Bangladesh's private sector credit of 13.9% reported in September 2022 with Brac Bank's lending activities outperforming the industry average, maintaining double-digit growth for the past four quarters consecutively.
On the other hand, the commission, brokerage and exchange income of the banking business doubled in Q3 CY22.
While the commission and fee income swelled by 27%, the other income of Brac Bank increased by three times in the nine months of the current year.
