Impact of Covid-19 on banking performance of Mercantile Bank Ltd. compared to some selective commercial banks of Bangladesh

Abstract

This report is focused on my 12-week internship experience in Mercantile Bank Limited. As an intern, I saw how the pandemic impacted bank’s operations and the restrictions it imposed. Thus, my report focuses on studying the extent of the coronavirus's effect on some commercial banks in 2020. This study mainly deals with financial performance analysis of 8 local commercial banks’ half yearly financial statements of year 2019 and 2020. As I was an intern of MBL, I wanted this report to focus on MBL's banking performance in comparison to other banks. The other 7 banks were randomly selected out of 45 local commercial banks. They areAB Bank Ltd., Bank Asia Ltd., BRAC Bank Ltd., Dutch-Bangla Bank Ltd., Dhaka Bank Ltd., Eastern Bank Ltd. and City Bank Ltd. Primary data such as observation and interview with an official and secondary data such as these banks’ financial reports, journal papers, e-articles etc. were used to conduct this report. Their financial reports were studied in order to determine the bank’s profitability despite the effect of covid-19 on their sector. According to the findings, single digit interest rate and the global pandemic coronavirus has caused Mercantile Bank Ltd. BRAC Bank Ltd. and City Bank Ltd.’s performance to worsen whereas AB Bank Ltd. reported an increase in profit margin. Furthermore, Bank Asia Ltd., Dhaka Bank Ltd., DBBL, and EBL were among the banks that managed to maintain their positions. Hopefully, the analysis and the report's recommendations would provide the banks with insight on how to avoid financial risk and maximize profitability.