NiMB holds its aGM

The Nepal Investment Mega Bank Ltd (NIMB) held its 37th Annual General Assembly last week.

The bank earned a net profit of 3.32 billion rupees in the financial year 207980 BS, the Bank didn’t distribute dividends due to some provisions imposed by the Nepal Rastra Bank. Prithvi Bahadur Pande’, the chairman of the bank, expressed sorrow that for the first time in the 37 years of banking history, the shareholders did not receive cash dividends. Chairman Pandey stated that commercial banks are going through different problems and the entire banking sector has been affected by the problems that appeared in the nation’s financial sector. The Covid-19 pandemic and the post-Covid impact also hit the Nepali financial sector, Pande’ informed. He said that the bank, in which his family invested billions of rupees, did not pay even a single rupee as a cash dividend. Pandey said that due to the adverse situation, the bank was unable to distribute dividends, however, he promised to make the shareholders happy by giving sensible dividends in the future.

The biggest setback for the bank was when the government introduced a tax on FPO in the budget. Whereas, there is no practice of imposing tax on FPO in any country of the world including India. But after the Supreme Court also imposed tax on FPO, the bank had to lose 1 billion 92 crore 23 lakh 21 thousand 981 rupees from its net profit.

The bank has invested in 34,000 ex-Nepali army soldiers with loans to make them self-employed. After retiring from the army, self-employment loans have given great relief to support their families. 46 percent of female employees are employed in the bank. After merging with Mega Bank, the bank has closed 36 branches to cut costs. The bank said that many branches will be merged in the future.

In the financial year, the total assets of the bank reached Rs 4 trillion 46 billion. Last year, the total assets of the then Nepal Investment Bank and the then Mega Bank were 2 trillion 44 billion and 2 trillion 23 billion respectively, out of a total of 4 trillion 68 billion rupees. 21.43 billion, i.e. a decrease of 4.58 percent. The bank during the review period Rs. 16.97 billion deposits have increased. In the previous year, the total deposits of the then Nepal Investment Bank and the then Mega Bank were Rs. 3 trillion 43 billion increased by 4.94 percent to Rs. 3 trillion has reached 60 billion.

Similarly, loans and advances of about Rs. 2.29 billion decreased to Rs. 3 trillion 12 billion by the end of Asar 2080 BS has been maintained. In the previous year, the total loans and equity of the then

Nepal Investment Bank and Mega Bank were Rs. 3 trillion is 0.73 percent less than 14 billion. Due to highinterest rates, economic recession, political instability and a declining investment environment, the non-performing loans of the bank reached 4.54 percent in the financial year under review.

Due to the economic recession seen after the covid-19, especially the rural areas and small and medium industries, the decline in real estate and the capital market, and the problem of cooperative institutions, the impact on the entire financial system has also increased the nonperforming loans of the banks.

As a result, the non-banking assets of the bank have also increased, which at the end of the year under review stood at Rs. 1.1 billion has reached 1.6 billion. Due to the economic recession, the real estate prices have decreased by 20-30 percent on average and it is also difficult to sell the nonbanking assets, so it seems that the non-banking assets will increase further in the future. However, the bank is continuously trying to bring the non-performing loans within the desired limits by implementing loan recovery more effectively within the existing policy guidelines. Review of profit and loss In the year 2079/80, the bank has Rs. 12 billion 31 million net interest income. Similarly, net fee and commission income in this financial year is Rs. 1 billion 60 million. Earnings equivalent to foreign exchange Rs. 50 crores and 76 lakhs. Similarly, other operating income is Rs. 35 million 25 million.

In terms of loan loss arrangement, the bank in the year 2079/80 Rs. 3 billion 20 crores more provision has been made, while under nonoperational expenses Rs. 1 billion 30 million loan write-off. In the year under review, the bank's staff expenses were Rs. 3.4 billion has been spent while operating expenses (including depreciation) are Rs. 1 billion 900 million, the bank has mentioned in its annual report.