Kathmandu: Citizens Bank has reported a sharp drop in profit in the first half of the current fiscal year, as a steep rise in loan-loss provisions outweighed modest growth in core interest income.
By the end of the second quarter of FY 2025/26, the bank posted a net profit of Rs 358.9 million rupees, down 45.8 percent from Rs 661.8 million in the same period last year.
Net interest income edged up 2.3 percent to Rs 3.14 billion, but fee and commission income slipped 3.2 percent to Rs 623.8 million, limiting overall earnings momentum.
Although total operating income rose 4.7 percent to Rs 5.12 billion, the amount set aside for potential bad loans jumped from Rs 1.39 billion to 1.83 billion, significantly eroding profitability.
As a result, operating profit plunged 44.7 percent to Rs 504.2 million.
Earnings per share fell to Rs 4.63 rupees from Rs 8.96 a year earlier, while net worth per share stood at Rs 149.79 and the price-to-earnings ratio at 41.68.
The bank reported a negative distributable profit of Rs 1.10 billion rupees and transferred Rs 459.4 million to regulatory reserves due to difficulties in interest recovery, with accumulated losses reaching Rs 1.10 billion.
Citizens Bank has paid-up capital of Rs 15.51 billion and reserves of Rs 8.82 billion.
Deposits dipped slightly to 210.22 billion rupees by mid-January, while loans stood at Rs 168.21 billion. Asset quality remains under pressure, with non-performing loans at 6.86 percent, a core capital adequacy ratio of 8.69 percent, and a base interest rate of 5.62 percent.
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