Banking News – National Cooperative Bank Limited has made significant progress in its financial improvement journey, with its capital adequacy ratio (CAR) reaching 11.66 percent in the fourth quarter of fiscal year 2082/83. The bank published its unaudited financial statements for the fourth quarter on Wednesday.

The bank’s CAR has surpassed the 8 percent minimum threshold set by Nepal Rastra Bank, indicating a notable improvement in its financial stability and risk-bearing capacity.

The ratio, which had remained at 4.42 percent in the previous quarter, increased to 11.66 percent within a short period, marking a significant achievement for the bank. The improvement indicates progress in strengthening its capital base while addressing challenges faced in the past.

According to the financial statements, the bank recorded a net profit of around Rs. 490 million during the fourth quarter. The bank, which had incurred a loss in the previous fiscal year, successfully returned to profitability in the current fiscal year.

Net interest income also increased significantly to more than Rs. 870 million, indicating an improvement in the bank’s core business activities.

The bank also reported positive growth in operating income and operating profit. According to the management, the improvement in the bank’s overall performance has been supported by a strengthening financial foundation.

The bank has also made significant progress in reducing its accumulated losses, which had been one of its major challenges in the past. The profit generated during the current fiscal year has contributed substantially to reducing accumulated losses. However, the bank said further efforts will be required to eliminate the accumulated losses completely in the coming periods.

Despite improvements in several financial indicators, non-performing loans (NPLs) remain a major challenge for the bank. The NPL ratio stood at 32.26 percent as of the fourth quarter, which remains high by banking standards.

The figure indicates that loan recovery, risk management and improvement in credit quality will remain key priorities for the bank in the coming period.

The bank said it has adopted strategies to control bad loans, make loan recovery more effective, strengthen its risk management system and further institutionalize good corporate governance.

National Cooperative Bank Chief Executive Officer Badrikumar Guragain said the bank’s return to profitability, reduction in accumulated losses and success in raising the capital adequacy ratio above Nepal Rastra Bank’s minimum requirement were important achievements in its institutional reform journey.

He said the bank would give high priority to reducing non-performing loans, further strengthening its capital base and ensuring sustainable financial stability in the coming days.

The latest financial results indicate that National Cooperative Bank is moving toward greater stability after progressing through a period of reform and restructuring. However, the bank still needs to focus on controlling non-performing loans, fully managing accumulated losses and further strengthening institutional governance for long-term sustainability.