BAHL reports muted earnings in CY21

February 09, 2022 (MLN): Bank Al-Habib Limited (BAHL) has announced its CY21 results wherein the bank has posted a profit after tax of Rs18.6billion (EPS: Rs16.72) as compared to PAT of Rs17.96bn (EPS: Rs16.16) reported in the calendar year 2020, up by only 3.6% YoY.

This muted growth in profitability is due to lower net interest income (NII), however, lower provision charges and growth in non-funded income (NFI) income helped to achieve meager growth in profitability.

The financial result was accompanied by a final cash dividend of Rs7 per share i.e. 70% for the year ended December 31, 2021,

During the period under review, the bank’s interest income came down by 7% YoY while interest expenses decreased by roughly 9.6% YoY, hence BAHL’s net interest income (NII) stood at Rs55.61bn, showing a decrease of 3.5% YoY during CY21.

While, non-funded income (NFI) of the bank surged by 38.4% YoY to stand at Rs14.5bn due to a 41% increase in fee and commission income, around 38.6% YoY increase in foreign exchange income, 40% jump in other income coupled with a share of profit of Rs372mn, up by 3.25x YoY in CY21.

On the provision side, the bank reported a provision of Rs314mn in CY21, depicting a massive decline of 93% YoY when compared to Rs4.5bn charged in CY20. The higher provision charges in CY20 were related to COVID-related general provisions which are absent in CY21.

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