Earnings per share (EPS) of most of the listed non-bank financial institutions (NBFIs) fell in January-June period of this year compared to the same period of the previous year.
EPS is the portion of a company’s profit allocated to each outstanding share of common stock. In short, it serves as an indicator of a company’s profitability.
Out of the 23 listed NBFIs, 22 have so far declared their H1 earnings and The People’s Leasing & Financial Services (PLFS) did not declare earnings as the government decided to liquidate the company due to deterioration of its financial health in the last several years.
According to un-audited financial statements, consolidated EPS of 11 companies EPS fell (four of them saw higher losses), while 10 companies’ EPS increased and one remained unchanged year-on-year in January-June 2019, the Dhaka Stock Exchange data shows.
Market analysts said lack of new investments, thanks to a liquidity crisis, cast a gloom over the non-bank financial institutions sector during the period under review.
"Most of the financial institutions could not borrow from the banking sector as per their demand and hence the decline in their earning per share," said a managing director of a leading NBFI, seeking anonymity.
The huge amounts of provisioning due to non-performing loans and losses from capital market investments, according to him, ate into the profits of the NBFIs.
The capital market was a major source of income for the financial institutions. But almost all the NBFIs incurred losses from stock investments due to the market fall, said a leading broker.
DSEX, the prime index of the DSE, plunged 247 points or 4.58 per cent in the January-June period of this year.
The EPS of BIFC, Delta Brac Housing Finance, Fareast Finance, First Finance, GSP Finance, ICB, IDLC Finance, International Leasing and Finance, Midas Financing, Phoenix Finance and Premier Leasing declined in January-June period of 2019 compared to the same period a year ago.
Of them, four companies – BIFC, Fareast Finance, First Finance and Midas Financing saw their losses higher during the period under review.
The EPS of BD Finance posted the highest rise of 1050 per cent to Tk 0.23 in January-June 2019, from Tk 0.02 in the January-June, 2018.
The EPS of FAS Finance, IPDC Finance, Islamic Finance, LankaBngla Finance, National Housing Finance, Prime Finance, Union Capital, United Finance and Uttara Finance also increased in January-June 2019.