CYC Nepal Laghubitta Bittiya Sanstha (CYCL), a prominent microfinance institution in Nepal, has released its third-quarter report for the current fiscal year, revealing a substantial surge in net profits. The company’s improved financial performance can be attributed to a notable reduction in non-performing loans (NPLs), underscoring its commitment to sound risk management practices.
During the review period, CYCL reported a net profit of Rs 28 million, marking an impressive 263.40% increase compared to the Rs 7.7 million recorded in the corresponding period of the previous fiscal year. While the company’s net interest income and net fee and commission income saw modest gains of 17.99% and 15.88% respectively, the significant decrease in NPLs played a pivotal role in boosting its bottom line.
CYCL’s total operating income rose by 17.49%, accompanied by a remarkable 291.06% surge in operating profits. Notably, the company’s NPL ratio declined from 9.84% to 4.74%, leading to a substantial reduction in impairment charges, which fell from Rs 50 million to Rs 5.4 million. This prudent management of loan quality contributed significantly to the substantial growth in both operating profit and net profit.
The microfinance firm recorded a distributable profit of Rs 21.8 million for the quarter under review. Additionally, CYCL maintained an impressive earnings per share (EPS) of Rs 14.02, a net worth per share of Rs 216.40, and a price-to-earnings (P/E) ratio of 123.05 times.
As of the third quarter, CYCL boasted a paid-up capital of Rs 266.4 billion and a reserve fund of Rs 310.1 million. The company’s deposit base stood at Rs 4.98 billion, while its loan portfolio amounted to Rs 5.74 billion, reflecting its commitment to providing accessible financial services to underserved communities.
