IPDC Finance Limited, a publicly traded non-bank financial institution (NBFI) in Bangladesh, announced a remarkable upturn in its financial performance during the April-June quarter of 2023. The company’s net profit surged to Tk8 crore; an astounding five times higher than the previous quarter’s earnings. However, IPDC still faces challenges in recovering its overall annual performance for the current year’s second half. During the first half of 2023, the company experienced a sharp decline in profit after taxes, plummeting by 78% to Tk9.51 crore when compared to the same six-month period in 2022.
The NBFI industry in Bangladesh encountered a tumultuous first half of the year due to mounting pressure to pay higher interest rates against the collected funds. A lending rate cap prevented the NBFIs from charging borrowers’ higher rates, leading to a historic low spread of less than 1% for the overall industry and less than 3% for top-tier firms. However, at the beginning of July, the cap was lifted, allowing NBFIs to charge up to 500 basis points higher than the benchmark six-month average of 182-day treasury bills. Despite the challenges, IPDC maintained a strong financial position, ensuring a provision of 109% against classified loans at the end of June, with a capital adequacy ratio of 17.42%, surpassing the regulatory requirement of 10%. As of June, IPDC’s net asset value per share stood at Tk17.51.
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