Brac Bank Ltd (BBL) has announced that it had earned Tk454 crore in net profit for 2020.
The bank, during a virtual earnings disclosure on Monday, also said that the amount was registered on a standalone basis, while it roped in Tk403 crore on a consolidated basis, i.e. with all its subsidiaries, according to a press release.
Its earnings per share (EPS) stood at Tk3.42, while its board of directors recommended a 10% cash dividend and 5% stock dividend for formal adoption at the bank’s annual general meeting, scheduled to be held on May 27.
The net asset value (NAV) per share, as of December 2020, stood at Tk36.63 on a consolidated basis and at Tk35.41 on a standalone basis.
The bank’s 2020 non-performing loan (NPL) ratio dropped to 2.9%, reflecting regulatory forbearance, while the NPL coverage ratio was enhanced to 171% to build reserves against potential bad debt challenges arising out of the pandemic.
BBL reported a consolidated Capital Adequacy Ratio (CAR) of 15.13% for 2020 with 92% Tier-1 Capital, the highest Tier-1 capital ratio in the industry. The Bank’s standalone CAR, at 14.55%, is also well above the 12.5% regulatory requirements.
Brac Bank's customer deposits grew by 9% YoY (year on year) while the CASA mix improved from 43% to 55% reflecting a successful deposit mobilization and interest rate management strategy.
The bank was very cautious in growing its customer loan portfolio in 2020 with a 3% YoY net growth.
Customer lending started the year strongly but was then impacted by the pandemic. While SME lending grew well at 17% YoY, the Bank was very selective in growing loans in corporate, commercial and retail banking.
In 2020, the local banking sector experienced a significant reduction in net interest income from customer loans with the Bangladesh Bank imposing a 9% lending rate cap with effect from April 2020.
Despite this, Brac Bank ended the year with a net interest margin of 4.6 per cent.
Selim RF Hussain, BRAC Bank's managing director and CEO; M Masud Rana, DMD and chief financial officer; Sabbir Hossain, DMD and chief operating officer; Tareq Refat Ullah Khan, DMD and head of the corporate banking division and other senior business heads presented the financial results, outlined the bank’s strategy and conducted a Q&A session.
Hussain ended the program by stating, “BRAC Bank had come out of the pandemic with its reputation among customers and stakeholders even higher than at the start of the year.”
