IDLC Finance’s profits slump 29% in Q1
IDLC Finance Limited yesterday reported securing a consolidated profit after tax of Tk 34.4 crore in the first quarter of 2023.
This is however 29 per cent less than what the non-bank financial institution made in the same period of the previous year.
The company logged a consolidated profit after tax of Tk 34.4 crore in the January-March quarter of the current year.
It was Tk 48.3 crore in the same period last year.
The details of the first quarter's financials were declared at a board meeting.
The rate cap imposed by the central bank resulted in lower interest income and higher payments on deposits while capital market income has decreased, the two major reasons for the fall in profit, the company said in a press release.
In Q1 2022, the lending business operated on an open market and risk-based pricing system.
Moreover, the central bank had imposed a mandatory rate revision on NBFIs in July 2022, significantly decreasing the interest income from lending operations.
Furthermore, the ongoing liquidity pressure in the market since the second half of 2022 created a deposit rate push, the impact of which was the hike in the cost of funds.
This resulted in the net interest income falling by Tk 13.4 crore compared to the same quarter of the previous year.
On the other hand, the capital market has been challenging since the second half of 2022. On such grounds, the operating profit has been negatively impacted.
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