…outpacing last year’s performance
A recent monthly financial statement report by the Royal Monetary Authority (RMA), states that Bhutan’s commercial banks have reaped a noteworthy upturn in financial performance, collectively generating a net profit of Nu 5.4mn (million ngultrum) during the month of February 2023.
The report highlights a substantial surge in profits compared to the corresponding period last year, reflecting an impressive increment of Nu 4mn.
The financial statement report sheds light on several significant findings, with one notable aspect being the remarkable growth in foreign currency financial assets. The report reveals that cash and cash equivalents held in foreign currency reached a total of Nu 31.5mn (31,538,514) during the period under review.
While this figure represents a decrease from the previous year’s amount of Nu34.8mn (34,852,146) it still highlights the banks’ robust holdings in foreign currencies.
The report further brings attention to significant developments in trading assets, with a notable surge observed during the period. Trading assets soared to Nu 1mn (1,006,177) marking a substantial increase from the previous year’s figure of Nu 0.36mn (366,156).
This upward trend indicates the banks’ active engagement in trading activities, potentially capitalizing on market opportunities and expanding their revenue streams.
Additionally, the report highlights growth in the securities category, which encompasses investments such as stocks, bonds, and other financial instruments. The total value of securities reached Nu 60mn (60,073,332) showcasing a noteworthy rise compared to the previous year’s amount of Nu 52mn (52,184,174).
This growth signifies the banks’ efforts to optimize their investment portfolios and capitalize on the performance of various financial markets.
Regarding IMF-related assets, the financial statement reveals a minor decrease from Nu 4.8mn (4,899,758) in February 2022, to Nu 4.7mn (4,744,835) in February 2023. However, there was an increase in interest and other receivables to Nu 1.1mn (1,126,751) in the same month of 2023 compared to Nu 0.3mn (340,298) in 2022.
The total value of foreign currency financial assets reached Nu 98.4mn (98,489,609) demonstrating a decrease from Nu 103mn (103,609,252) in the previous year.
Additionally, local currency financial assets experienced a noteworthy increase.
Within the local currency financial assets category, cash and cash equivalents amounted to Nu 1.2mn (1,238,014) compared to Nu 0.1mn (107,089) in the previous year. However, the gratuity fund decreased to Nu 63,053, from Nu 70,526.
Loans to staff reduced to Nu. 11,337, from Nu 15,447. On the other hand, ways and means advance to the Royal Government surged to Nu 3.6mn (3,636,471) up from Nu 2mn (2,095,517.)
The total value of local currency financial assets reached Nu 4.9mn (4,948,875) showing a significant increase from Nu 2.2mn (2,288,579) in the previous year.
Foreign currency non-financial assets amounted to Nu 2.5mn (2,565,149) an increase from Nu 1.4mn (1,499,015)
Non-financial assets also demonstrated growth, with a total amount of Nu 5.5mn (5,598,227) up from Nu 5.1mn (5,158,936).
Additionally, the RMA of Bhutan reported a substantial increase in net profit for the fiscal year.
While, Net interest income reached Nu1.3mn (1,334,442), compared to Nu 0.7mn (711,548), in the previous year, other incomes also saw a significant rise to Nu 4.3mn (4,342,910), up from Nu 0.7mn (782,785).
The total net operating income amounted to Nu 5.6mn (5,677,352), showcasing significant growth compared to Nu 1.4mn (1,494,333) in the previous year.
Meanwhile, operating expenses decreased to Nu 0.25mn (256,687) from Nu 0.27mn (274,191).
Consequently, the net profit for the year reached Nu 5.4mn (5,420,665), a substantial increase from Nu1.2mn (1,220,142).
Tshering Pelden from Thimphu