City Bank crosses Tk 1,000cr net profit milestone for the first time

City Bank has announced a record-breaking consolidated net profit of Tk 1,014 crore for 2024, the highest in the bank's 42-year history. This milestone makes City Bank only the second conventional, locally-owned bank in Bangladesh to exceed the Tk 1,000 crore mark in net profit, following BRAC Bank's announcement of a Tk 1,432 crore net profit earlier this week.

On a standalone basis, City Bank posted a net profit of Tk 1,085 crore. However, the consolidated figure stood lower due to provisioning expenses against unrealised capital market losses incurred by two of its subsidiaries.

Compared to a consolidated net profit of Tk 638 crore in 2023, the bank recorded a year-on-year increase of Tk 376 crore, representing 59% growth, the highest annual increase in its history.

At a board meeting held on Tuesday, the bank approved its financial statements for 2024 and declared a 25% dividend, comprising 12.5% in cash and 12.5% in bonus shares—consistent with its payout ratio from the previous year. Subject to approval at the upcoming Annual General Meeting (AGM), the cash dividend alone will exceed Tk 170 crore.

City Bank's earnings per share (EPS) rose to Tk 7.53 in 2024 from Tk 4.74 in 2023, mirroring the 59% profit growth. The bank's net asset value (NAV) per share also increased by 20.41% to Tk 34.39.

Commenting on the bank's performance, Managing Director and CEO Mashrur Arefin said, "People have placed their trust in City Bank, resulting in a surge in deposits. Our cost-to-income ratio dropped from 60% to just 42%, leading to a substantial rise in profit. We also increased employee salaries by Tk 300 crore to motivate our workforce. Our board is honest and committed to the bank's growth. We uphold a superior level of governance practices. These are the primary drivers behind our performance."

City Bank's deposits grew by 31% or Tk 12,177 crore in 2024, while loans increased by 12% or Tk 4,831 crore. A significant portion of the excess funds—Tk 6,150 crore—was invested in government securities, which rose from Tk 6,338 crore to Tk 12,488 crore over the year.

An analysis of the bank's revenue sources reveals that 64% came from interest income on loans, 12% from fees and LC commissions, and 19% from investments in treasury bills and bonds. The remaining 5% was derived from private bonds, dividends, and stock market investments. In total, 76% of the bank's income was generated from core banking operations.

The bank also recorded a remarkable increase in cash flow per share, which rose to nearly Tk 66.44 in 2024 from Tk 2.90 the previous year—a 23-fold increase.

Banking industry insiders have called City Bank's achievement a significant benchmark for the sector, signalling robust governance, operational efficiency, and growing investor confidence in the country's financial institutions.