UBL posts 33% profit, declares Rs16 dividend

July 22, 2026 (MLN): United Bank Limited (PSX: UBL) recorded a robust 33% increase in its net profit for the half year ended June 30, 2026, with profit after taxation climbing to Rs85.91bn from Rs64.73bn in the corresponding period last year.

Showing this strong bottom-line growth, the bank's earnings per share (EPS) expanded to Rs34.3 from Rs26.07 in 1HFY25.

The top-line performance showed healthy momentum, with total income rising 26% year-on-year to Rs263.51bn from Rs208.48bn in the prior period.

The core banking spread showed steady improvement, with mark-up/return/interest earned rising 18% to Rs665.03bn.

However, mark-up/return/interest expensed grew at a faster pace of 22% to Rs475.32bn, causing net mark-up/interest income to expand at a more modest 8% to Rs189.71bn from Rs175.43bn in the same period last year.

The standout driver of the period was an exceptional surge in non-mark-up/interest income, which more than doubled to Rs73.80bn from Rs33.05bn a growth of 123%.

This was powered by a massive 420% jump in net gain on securities to Rs42.35bn from Rs8.15bn, a 63% surge in foreign exchange income to Rs12.81bn, and steady growth in fee and commission income of 5% to Rs17.31bn. Other income rose 71% to Rs778.52m.

These gains more than offset a 59% decline in dividend income to Rs557.47m, while gain/loss from derivatives swung to a marginal loss of Rs2.38m against a loss of Rs1.25bn last year.

On the expenditure side, operating expenses rose 43% to Rs85.52bn, and Workers' Welfare Fund increased 19% to Rs3.51bn.

Other charges surged to Rs15.20m from Rs2.49m. Taken together, total non-mark-up/interest expenses climbed 42% to Rs89.04bn from Rs62.60bn.

The share of loss from associates came in at Rs149.94m, reversing a profit contribution of Rs605.44m recorded in the prior period.

Profit before credit loss allowance grew 19% to Rs174.33bn. Credit loss allowance and write-offs net registered a moderate increase of 8% to Rs4.21bn.

Notably, the credit loss line moved in UBL's favour on a net basis, contributing positively to profit before taxation, which rose 19% to Rs178.53bn from Rs150.37bn.

Taxation increased 8% to Rs92.63bn from Rs85.64bn, a proportionally smaller rise than pre-tax profit growth, providing an additional tailwind to the bottom-line.

Profit attributable to equity holders of the bank stood at Rs85.90bn, up 33%, while non-controlling interest accounted for Rs10.18m.

The Board of Directors has declared an interim cash dividend of Rs8 per share (160%) for the second quarter ended June 30, 2026.

This is in addition to the interim dividend of Rs8 per share (160%) already paid, bringing the total cash dividend declared for 1HFY26 to Rs16 per share.

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