BAHL 1HCY26 profit falls 22%

August 20, 2026 (MLN): Bank AL Habib Limited (PSX: BAHL) reported a 22% decline in its consolidated net profit for the half-year ended June 30, 2026 (1HCY26), recording Rs15.41bn compared to Rs19.79bn in the corresponding period last year.

Alongside the financial results, the bank announced an interim cash dividend of Rs3.5 per share.

Reflecting this bottom-line compression, the bank's basic and diluted earnings per share (EPS) attributable to shareholders fell to Rs13.85 for the half-year, down from Rs17.80 in 1HCY25.

The primary factor weighing on overall performance was a mild compression in net mark-up income coupled with rising operating costs.

Mark-up/interest earned fell 6% to Rs167.56bn, while mark-up expensed contracted 8% to Rs102.47bn.

As a result, net mark-up income dipped 2% year-on-year to Rs65.10bn.

However, BAHL’s non-markup revenue streams demonstrated remarkable strength.

Total non-mark-up income surged 20% to Rs19.95bn (up from Rs16.61bn), spearheaded by an 80% jump in foreign exchange income to Rs6.40bn and a 106% rise in share of profit from associates to Rs902.93m.

Net losses on securities also narrowed to Rs319.14m from Rs433.65m last year. This non-interest momentum drove total income up by 2% to Rs85.04bn.

On the expense side, operating expenses rose 16% to Rs52.18bn to support branch expansion and inflation pressures, pushing total non-mark-up expenses up 15% to Rs52.88bn.

Consequently, profit before credit loss allowance fell 14% to Rs32.16bn.

Below the pre-provision line, financial results were further impacted by a shift in credit provisions.

BAHL recorded a net credit loss allowance charge of Rs18.83m in 1HCY26, marking a complete turnaround from the Rs2.65bn net provision reversal booked in 1HCY25. This shift dragged profit before taxation down 20% to Rs32.14bn.

The reduction in pre-tax earnings was partially buffered by a 17% lighter taxation charge of Rs16.73bn (down from Rs20.19bn in 1HCY25).

Supported by tax relief and non-interest income growth, Bank AL Habib Limited securely closed the six-month period with a final net profit of Rs15.41bn.

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