Written by The Banking Post
Rupali Bank has slipped into a major loss for the third quarter of 2025 as its non-performing loans (NPLs) soared and interest expenses outpaced earnings from loans.
The state-run bank, which is the only government lender listed on the stock market, reported a Tk 1.68 billion loss for the quarter ending in September — a sharp reversal from a Tk 31 million profit in the same period last year, according to its disclosure on the Dhaka Stock Exchange (DSE) on Sunday.
Its earnings per share (EPS) fell to Tk 3.44 in the negative, from Tk 0.13 positive a year ago. Following the announcement, Rupali Bank’s stock plunged 9.84 per cent to Tk 17.40, making it the day’s top loser on the DSE.
The bank attributed the losses mainly to a drop in operating income caused by higher interest payments to depositors. It earned Tk 7.36 billion in interest from loans during the quarter, while interest expenses soared to Tk 13.02 billion.
The shrinking interest rate spread also hurt profitability. In September, the sector’s average deposit rate stood at 6.42 per cent, and the lending rate at 12.16 per cent, narrowing the spread to 5.74 per cent—the lowest since April 2024, according to Bangladesh Bank data.
Despite a profit in the first two quarters, the bank ended the nine months to September with a Tk 1.58 billion loss, as earlier gains failed to offset third-quarter setbacks.
Due to the heavy losses, Rupali Bank could not maintain adequate provisions against its classified loans, further weakening its balance sheet. The bank also remains barred from paying dividends under the central bank’s directive, which prohibits lenders with provision shortfalls from distributing dividends. Rupali’s provision gap currently stands at Tk 153.75 billion.
The bank’s net operating cash flow per share (NOCFPS), however, improved sharply to Tk 128.19 for the January–September period from Tk 43.33 negative a year earlier, supported by a rise in deposits. Deposits grew 4 per cent year-on-year to Tk 731 billion, while the loan book fell over 2 per cent to Tk 503 billion.
Rupali’s profitability has been declining for years. In 2023, its annual profit stood at Tk 626.68 million, which dropped 82 per cent to just Tk 113.92 million in 2024.
To strengthen its capital base, the bank is now issuing ordinary shares worth Tk 6.80 billion against funds received from the government as share money deposits. It plans to issue 453.33 million shares at Tk 15 each — including a Tk 5 premium — in favour of the Finance Division.
Once completed, the move will raise Rupali Bank’s total number of shares from 488 million to 941 million, significantly boosting its paid-up capital.
