A total of 14 private commercial banks (PCBs) in the country enjoyed an increase in their operating profits in the first half of this calendar year, mainly due to booming foreign-trade activities.
Gathering provisional data on 15 private commercial banks (PCBs), only one out of the lot saw a decrease in its operating profits during the half yearly period.
The un-audited operating profit, however, did not reflect the actual financial position of the banks as they have to set aside funds for provisioning bad debts and paying taxes.
Higher foreign trade, covering export and import, helped the banks to earn more as operating profit during the period under review, according to bankers.
Meanwhile, Bangladesh's import expenses have ballooned on account of a fresh hike in prices of essential commodities, including fuel oil, on the global market mainly due to the ongoing Russia-Ukraine war, the bankers added.
The settlement of letters of credit (LCs), generally known as actual imports, in terms of value, rose by 48.25% to $67.87 billion during the July-April period of the outgoing fiscal year 2021-22, from $44.78 billion in the same period of the previous fiscal, according to latest Bangladesh Bank statistics.
On the other hand, the opening of LCs, generally known as import orders, grew over 44.53% to $78.65 billion during the period under review from $53.04 billion in the same period of FY21.
However, credit flow into Bangladesh's private sector increased further in May 2022 - following rising demand for loans, particularly for trade financing, to settle import-payment obligations.
The credit flow rose to 12.94% in May on a year-on-year basis, from 12.48% a month before, according to the central bank's statistics.
The banks, which had managed non-performing loans (NPLs) properly, have been able to book better operating profits during the H1, bankers said.
The amount of classified loans in Bangladesh's banking system increased by 9.85% to Tk113,441 crore during the January-March period of 2022, from Tk103,274 crore in Q4 of 2021, as the central bank revoked policy relaxation on loan repayment.
