IDLC earnings weighed down by subsidiaries

IDLC Finance's earnings per share fell 6 percent to Tk 5.76 last year from a year ago because of a lower net profit caused by the negative growth of its three subsidiaries. Its loan book rose 17.39 percent to Tk 8,390 crore in 2018 and the non-performing loans dropped to 2.20 percent from 2.77 percent from a year ago, IDLC said in a statement yesterday.

On a standalone basis, the company's profit after tax was up 1 percent, but it was a 5-percent decline on a consolidated basis. It earned Tk 217 crore in net profit in the year.

Arif Khan, chief executive officer and managing director of IDLC Finance, said though IDLC's standalone net profit grew very marginally, the earnings were affected by the negative growth of the group's other companies. The slumping stock market affected the company's overall income, he said.

“Yet, our subsidiaries have shown great resilience and outperformed the market and its peers.”

Khan vowed to recover this year by exploring new business opportunities.

“We have taken steps to enhance our scalability so that we may serve clients at more granular levels on the lending and wealth management sides.”

“To further diversify our income mix, we are preparing heavily to pave the way for greater fee-based businesses through structured finance, advisory services, investment banking, alternate investments, and fund management services.”

According to the statement, the company bagged 5,803 new loan clients last year. Net interest income grew 5.71 percent to Tk 422 crore.

Business segment-wise, the SME loan book grew 12.43 percent to Tk 3,469 crore. At present, the segment accounts for more than 42 percent of the loan portfolio.

The consumer portfolio, which consists of home, car and personal loans, rose 15.20 percent and the corporate loan division posted a year-on-year growth of nearly 38 percent to Tk 1,990 crore.

IDLC's share closed at Tk 67.70 from Tk 69.40 a day ago on the Dhaka Stock Exchange yesterday.