REPORT OF THE BOARD OF DIRECTORS Our path ahead is clear and we are now well positioned to drive sustainable profit growth.
It is an honour and a privilege to deliver this Report on behalf of the Board of Directors of the Bank. I am equally delighted to report that Standard Chartered Bank Nepal Limited has delivered a strong performance in the Financial Year 2074-75. The Board is pleased with the Bank’s efforts to increase the Bank’s return over the medium term; the Bank has grown income in a strong, safe and sustainable manner while maintaining both cost and capital discipline. The Board believes the current Management Team possesses the necessary focus, skills and commitment to deliver a superior outcome in the future. Our obligation is to carry out our business in a way which not only provides returns for our shareholders but also delivers good things for society: our clients, communities, and our people. We commit to focus our efforts on three objectives: helping the Bank to unlock its true potential; improving its resilience to shocks; and ensuring excellent governance and the highest ethical standards. These are critical building blocks to generating long term sustainable shareholder value. Nepal remains an attractive growth market and our unique business model makes us well positioned to capture Nepal’s growth story. The Bank continues to work hard to identify and seize the opportunities as they arise, becoming more competitive, embracing technological change and innovation, and continuing to develop attractive value propositions for our clients. At the same time, we should be mindful of the emerging risks around this favourable outlook. The Bank remains aligned to the main priorities of Government of Nepal, i.e. in the areas of building domestic infrastructure, creating a conducive investment climate for foreign investors and achieving fiscal resilience. In April 2018, the Bank organised the first ever conference on Blended Finance in Nepal, introducing blending as a sustainable method for crowding in private capital for funding infrastructure projects. Government of Nepal played host to bevy of partners and investors from across the globe. The outcomes from this conference are significant, clearly demonstrating the Bank’s commitment to driving trade & commerce through our diverse international network. There are clear links between the global economy, international banks and trade that are fundamentally tied to global growth and prosperity. As one of the world’s top three trade banks, Standard Chartered is ideally positioned to benefit from the opportunities that the continuing recovery in global trade will bring.
Our worldwide presence and the unique networking capability makes us efficient in enabling trade and investment around the globe. As banking plays a crucial role at the heart of the economy and in the lives of individuals, we remain committed in Nepal’s economic growth by supporting our clients and customers in various ways. The Board understands the importance of the payouts to shareholders and intends to maintain stable returns over time taking into account the earnings outlook, regulatory capital requirements including the introduction of additional regulatory reserve due to change in accounting standards by Nepal Rastra Bank. This is a critical journey, and we must remain focused in creating a foundation for a strong, sustainable business in the long term. As you are fully aware, our priority is to maintain well capitalised, highly liquid, and diverse balance sheet in delivering profitable & sustainable growth within our risk appetite. We are also working to instil a culture of excellence across our organisation. `Here for good’ our brand promise signifies how we operate as a bank and conduct our business. Standard Chartered is deeply embedded in our communities and we will continue our efforts to remain the best brand in our market.
Results – A Synopsis Financial Highlights* • Net Profit after tax was up by 41 percent to Rs. 2.19 billion compared to Rs. 1.55 billion in the previous year. • Earnings per share has increased by Rs. 4.56 to Rs. 27.33 due to increase in profits. • Loans to Customers increased by 16 percent to Rs. 44.56 billion compared to Rs. 38.43 billion last year. • Client deposits increased by 12 percent to Rs. 67.06 billion compared to Rs 59.69 billion last year. * as per NFRS compliant financial statements
Bank’s Performance
Standard Chartered Nepal has been delivering good performance year on year. The Bank has contributed an amount of Rs. 977 million to the Government Exchequer as compared to Rs. 596 million last year on account of corporate tax. In accordance with the statutory and regulatory requirements, the Board recommends a transfer of Rs. 28 million to Exchange Fluctuation Reserve, transfer of Rs.438 million to the General Reserve Fund and transfer of Rs. 346 million to the Regulatory Reserve. Further, the Board has proposed the dividend of 17.50 percent for which equivalent
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