Impressive Surge in Quarterly Profits for Pakistani Banks
Pakistani banks, including MCB Bank, Habib Bank, United Bank, National Bank, and Hub Power, reported significant increases in their quarterly profits for July-September 2023. The growth was driven by factors such as increased total income, expanded net interest income, and reduced provisioning. MCB Bank, in particular, demonstrated outstanding performance, achieving historic profits and reducing its effective tax rate. These robust financial results reflect the resilience and strength of Pakistan's banking sector in a challenging economic environment.
Karobar
KARACHI: Pakistan's banking sector saw a substantial boost in profitability for the third quarter of 2023, with several major banks reporting remarkable earnings growth.
MCB Bank Ltd announced on Wednesday that its earnings for July-September reached a staggering Rs19.6 billion, marking an impressive 112 percent increase compared to the same period last year. According to Arif Habib Ltd, this surge in profitability was attributed to a significant increase in total income, resulting in a 34 percent quarter-on-quarter expansion of the bank's bottom line. In addition to its stellar financial performance, MCB declared a dividend of Rs8 per share, bringing the total dividend paid out in 2023 to Rs21 per share. Notably, the bank's net interest income for July-September stood at Rs45 billion, reflecting an 80 percent increase from the previous year. Furthermore, MCB Bank Ltd managed to reduce its effective tax rate to 48.8 percent during the quarter, down from 54.3 percent in the same period a year ago.
In the first nine months of 2023, MCB's net income amounted to Rs48.2 billion, a remarkable 134 percent increase from the corresponding period in 2022. The bank's consistent growth in core earnings led to a historic nine-month profit before tax of Rs. 88.1 billion, representing a substantial 71 percent year-on-year growth. After-tax profits were recorded at Rs44.1 billion, translating to earnings per share of Rs37.25, a significant jump from Rs16.75 reported in the same period last year.
Picture Courtesy: Profit by Pakistan Today
Habib Bank Ltd also reported impressive financial results, with July-September earnings totaling Rs16.6 billion, reflecting a 44 percent year-on-year increase and a 28 percent growth on a quarterly basis. The annual profit increase was primarily driven by an expansion in net interest income, while the quarterly boost was facilitated by reduced provisioning. The bank declared a dividend of Rs2.25 per share for the third quarter, bringing the nine-month payout to Rs5.75 per share.
United Bank Ltd informed investors that its net income for July-September surged to Rs14.7 billion, marking a remarkable 126 percent increase from the previous year. The bank announced a dividend of Rs11 per share, resulting in an industry-leading payout of Rs33 apiece for the first nine months of 2023.
National Bank of Pakistan Ltd reported a net profit of Rs12.3 billion for July-September, representing a 76 percent year-on-year increase but a 22 percent decrease from the preceding quarter. The rise in net interest income contributed to the bank's positive performance during the outgoing quarter, but a reduction in non-funded income and substantial provisioning impacted overall profitability.
Hub Power Company Ltd saw its net income for the first quarter of 2023-24 reach Rs17.1 billion, marking an 88 percent year-on-year increase. This impressive surge in profitability was attributed to a 289 percent year-on-year increase in the share of profit from associates and joint ventures and the addition of Thar Energy Ltd. The company also announced a cash dividend of Rs5 per share.
Fauji Fertiliser Company Ltd posted earnings of Rs9.1 billion, marking a 74 percent increase from a year ago. Additionally, the fertiliser maker announced a cash dividend of Rs3.98 per share.
