Bank Alfalah profit falls 30% to Rs27.8bn in 2025

February 16, 2026 (MLN): Bank Alfalah Limited (PSX: BAFL) reported a profit after tax (PAT) of Rs27.80 billion for the year ended December 31, 2025, reflecting a 30.3% decline compared to Rs39.86bn in CY24.

Earnings per share (EPS) fell to Rs17.62 from Rs25.27 last year.

The board announced a final cash dividend of Rs3 per share (30%), in addition to three interim cash dividends of 25% each already paid.

This takes the total payout for CY25 to 105%.

The bank’s mark-up/return/interest earned declined 29.6% YoY to Rs356.95bn from Rs507.12bn, showing the impact of lower policy rates and reduced asset yields during the year.

However, mark-up/return/interest expensed dropped at a steeper pace of 41.9% YoY to Rs221.07bn from Rs380.25bn, benefiting from lower funding costs.

As a result, net mark-up/interest income (gross profit) increased 7.1% YoY to Rs135.88bn from Rs126.87bn, indicating improved spreads despite a compressed rate environment.

Total non-mark-up/interest income rose 3.7% YoY to Rs47.39bn from Rs45.68bn.

Within this, fee and commission income declined 8.2% to Rs16.41bn, while dividend income surged 111.1% to Rs2.80bn.

Foreign exchange income grew 26.6% to Rs12.09bn.

Income from derivatives fell 36.8% to Rs864.1m, and gain on securities declined 8.2% to Rs12.87bn.

Share of profit from associates increased 4.8% to Rs1.29bn, while other income jumped 233.4% to Rs1.07bn.

Consequently, total income increased 6.2% YoY to Rs183.27bn from Rs172.56bn.

On the expense side, total non-mark-up/interest expenses rose sharply by 35.6% YoY to Rs117.99bn from Rs87.04bn.

Operating expenses surged 36.9% to Rs116.52bn, showing inflationary pressures and business expansion costs.

Workers’ Welfare Fund expense declined 18.4% to Rs1.38bn, while other charges fell 58.2% to Rs93.0m.

Profit before credit loss allowance dropped 23.7% YoY to Rs65.27bn from Rs85.52bn, as expense growth outpaced income gains.

The bank recorded a net credit loss allowance and write-offs charge of Rs3.31bn, significantly higher than Rs271.2m in the preceding year, indicating elevated provisioning requirements.

As a result, profit before taxation declined 27.3% YoY to Rs61.96bn from Rs85.25bn.

Taxation expense decreased 24.9% to Rs34.09bn from Rs45.38bn; however, it was insufficient to offset the decline in pre-tax earnings.

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