October 21, 2020 (MLN): Allied Bank Limited (ABL)’s net income for the nine months period ended on September 2020 has clocked in at Rs 12.6 billion compared to the earnings of Rs 9.6 billion reported in the corresponding period last year, depicting a growth of 31% YoY.
This caused the Bank’s earnings per share to settle at Rs 11.03 as opposed to Rs 8.42 in the same period last year.
The growth in bank’s profitability was attributed to healthy 29% YoY growth in net interest income (NII). The earnings further strengthened by 3x increase in capital gains, offsetting a significant net provisioning charge of Rs 2.4 billion during the period.
According to the report by Arif Habib Limited, the YoY jump in NII was primarily owing to a steep reduction in the bank’s interest expense (15% YoY).
The total non-interest income of the bank posted a surge of 16.49% YoY during 9MCY20 primarily owing to capital gains this year of Rs 2.8 billion against a gain of Rs 910.6 million in the same period last year.
Furthermore, the bank’s Fee and commission Income also improved the overall profitability, as it clocked in at Rs 4.6 billion during the period mentioned above against Rs 4.1 billion recorded during 9MCY19.
On the other hand, as international trade activities remained subdued due to pandemic, the bank’s foreign exchange income plunged by 20% YoY, said the report.
On the expense side, the bank reported provisioning expense of Rs 2.4 billion against a reversal of Rs 356 million, further, its operating expenses also surged by 10% YoY.
Lastly, the bank witnessed 15ppts decline in affective tax rate from 57% to 42% during 9MCY20 which further supported bank’s earnings.
|
Consolidated Profit and Loss Account for the Nine months ended on September 30th, 2020 (Rupees in '000) |
|||
|---|---|---|---|
|
|
Jun-20 |
Jun-19 |
% Change |
|
Mark-up/return/interest earned |
86,631,705 |
86,985,661 |
-0.41% |
|
Mark-up/return/interest expensed |
49,451,922 |
58,207,069 |
-15.04% |
|
Net mark-up/interest income |
37,179,783 |
28,778,592 |
29.19% |
|
NON-MARK-UP/INTEREST INCOME |
|
|
|
|
Fee and commission income |
4,600,159 |
4,106,308 |
12.03% |
|
Dividend income |
967,301 |
1,405,198 |
-31.16% |
|
Foreign exchange income |
1,295,358 |
1,611,094 |
-19.60% |
|
Income from derivatives |
– |
– |
– |
|
Gain on sale of securities – net |
2,802,407 |
910,674 |
207.73% |
|
Other income |
107,027 |
355,814 |
-69.92% |
|
Total non-mark-up/interest income |
9,772,252 |
8,389,088 |
16.49% |
|
Total Income |
46,952,035 |
37,167,680 |
26.32% |
|
NON-MARK-UP/INTEREST EXPENSES |
|
|
|
|
Operating expenses |
22,130,783 |
20,228,505 |
9.40% |
|
Workers welfare fund |
498,394 |
344,944 |
44.49% |
|
Other charges |
169,225 |
104,123 |
62.52% |
|
Total non-mark-up/interest expenses |
22,798,402 |
20,677,572 |
10.26% |
|
Profit before provisions |
24,153,633 |
16,490,108 |
46.47% |
|
Provisions/(reversals) and write offs |
2,408,381 |
(356,364) |
– |
|
Extra ordinary / Unusual items |
– |
– |
– |
|
Profit before taxation |
21,745,252 |
16,846,472 |
29.08% |
|
Taxation |
9,111,618 |
7,209,386 |
26.39% |
|
Profit after taxation |
12,633,634 |
9,637,086 |
31.09% |
|
Earnings per share – Basic and Diluted (in Rupees) |
11.03 |
8.42 |
31.00% |
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