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BRAC Bank's profit jumps, on higher income from bKash, govt securities

FE REPORT | November 02, 2023 12:00:00

BRAC Bank has reported a 53 per cent year-on-year growth in its consolidated profit for January-September to Tk 5.83 billion, as its interest income and return on investments rose significantly.

A reduction in non-performing loans and higher income from the bank's subsidiary bkash also supported the boost to its income.

Chief Financial Officer (CFO) M Masud Rana said the lender had seen an increased amount of loans worth Tk 75 billion disbursed in January-September this year. During the time, non-performing loans (NPLs) dropped to 3.4 per cent from 3.6 per cent in the corresponding period last year. That is why the bank secured a good return from loans in the nine months.

According to the bank's financial statement, the company's year-on-year overall interest income advanced 33 per cent in January-September.

The company's interest income only from loans and advances saw a 38.31 per cent year-on-year rise in January-September.

Mr. Rana said the market-based reference rate or SMART (six-month moving average rate of Treasury bill) introduced at the end of June this year drove up interest income a bit.

Investment income from government securities also went up.

Of total investment income, Tk 3.39 billion and Tk 1.64 billion came in the form of interest and gains from investments in government securities respectively during the reporting period.

BRAC Bank diverted funds into government securities, considering risk-free returns, to avoid the volatile stock market.

Its income from stocks had a massive decline of 99 per cent to Tk 0.23 million in January-September this year, compared to a year earlier.

Income from bKash

The company's year-on-year profit derived from subsidiaries jumped 155 per cent to Tk 3.63 billion in January-September from the same period last year.

Of the subsidiaries, bkash played a pivotal role in boosting income.

Income from bkash soared to Tk 880 million in the nine months to September this year from just Tk 40 million a year ago.

The income mainly came from the financial income of bkash.

BRAC Bank's operating cash flow was much higher in the nine months compared to the previous year due to higher deposit mobilisation from customers and borrowings from banks.

The consolidated net operating cash flow per share was Tk. 28.02 for January-September this year, increased from Tk. 4.46 for January-September last year.

Meanwhile, the stock of BRAC Bank has remained stuck at the floor price of Tk 35.80 since May 18 this year on the Dhaka Stock Exchange.

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