Islami Bank’s profits fall 10pc

Islami Bank’s net profits declined 10 percent year-on-year to Tk 504.95 crore last year.

Islami-Bank-logo-sm20120719174108Due to the slide in profit, the bank announced lower dividends for 2013 compared to the previous year.

On Saturday, the bank recommended 8 percent cash dividends and 10 percent stock dividends for 2013, according to the company’s post on the Dhaka Stock Exchange website yesterday.

The bank, listed on the stockmarket in 1985, had disbursed 8 percent cash and 17 percent stock dividends for 2012.

The fall in profit and dividends eroded the investors’ confidence to chase for the bank’s securities, which brought down its share prices 2.89 percent on the trading board yesterday.

On the premier bourse yesterday, each share of the bank traded between Tk 33 and Tk 35, before closing at Tk 34.60. In 2012, Islami Bank made net profits of Tk 561.67 crore.

In the third quarter of 2013, the bank reported earnings of Tk 311.01 crore with 447.7 percent quarter-on-quarter growth, said BRAC-EPL Stock Brokerage, a security analyst.

“The staggering standalone fourth quarter earnings growth may be attributed to lower provisioning as the central bank relaxed loan rescheduling and provisioning guidelines to support corporate borrowers that suffered acutely due to political turmoil in the last quarter of 2013.”

As per newspaper reports, the stockbroker said, the bank had cut (rescheduled) its non-performing loan by 51 percent to Tk 1,364.30 crore in the fourth quarter, from Tk 2,786.40 crore in the third quarter of 2013.
“The yearly earnings (bottom line or net profit) fell short of T 61.96 crore or 14 percent which we were expecting,” the BRAC-EPL said.

-The Daily Star