Khushhali Microfinance Bank, the largest microfinance bank, faced the fallouts of the COVID-19 pandemic as its profit dropped by 5.4 percent in 2020 as compared with 2019.
According to the financial report, the bank’s profit decreased to Rs. 1.7 billion in 2020 as against the profit of the proceeding year of 2019, which stood at Rs. 1.84 billion. The earnings per share closed at Rs. 8.16 for the year in comparison to Rs. 8.62 per share.
The drop in profit was broad due to the follow-through effect of the industrial crises of 2019, which impacted portfolio quality resulting in higher provision charges.
The COVID-19 pandemic outbreak also affected the scale of operations resulted in a decrease in sales and loan recoveries.
Under the SBP’s loan relief scheme, the bank restructured and deferred loans worth Rs. 25.4 billion for nearly 500,000 borrowers. This also protected business of the bank’s borrower during the scenario of COVID-19 and its related lockdowns, the bank claimed.
According to the financial report, the markup increased by 17 percent, closing at Rs. 9.94 billion, whereas the non-markup decreased by 22 percent to reach Rs. 1.54 billion in the outgoing year.
The bank deposits maintained an upward growth increasing to Rs. 88.6 billion in 2020 from Rs. 63.9 billion in 2019. The bank’s loan portfolio surged to over Rs. 60 billion in 2020.