August 26, 2020 (MLN): Bank Alfalah Limited (BAFL) has announced its financial results for the half-year ended on June 30, 2020 wherein the bank has reported a profit after tax of Rs 5.778 billion i.e. around 9 % lower than net profits of Rs 6.316 billion in the same period last year.
This has translated into earnings per share which clocked in at Rs 3.25 against Rs 3.56 reported in the aforementioned period.
The decline in the bank’s profitability was mainly attributable to hefty provisioning charges.
The bank’s net interest income went up by 7.81% YoY to stand at Rs 23 billion in 1HCY20 on a back of compression in deposits cost in response to policy rate decline, as per the research of Aba Ali Habib.
During the period under review, despite the decline in fee income due to lower trade activities, non-funded income showed a stellar growth of 40% YoY on an account of a substantial increase of 59% in FX income capital gains of Rs 1.73 billion in 1HCY20 along with a two-fold increase in the share of profits from associates.
The major highlight is colossal provisioning charges which increased by around 4.88x YoY from Rs 979 million to Rs 4.788 billion when compared to the prior year, hurting the financial stability of the bank.
|
Consolidated Financial Results for the half-year ended June 30, 2020 ('000 Rupees) |
|||
|---|---|---|---|
|
|
Jun-20 |
Jun-19 |
% Change |
|
Mark-up/return/interest earned |
49,952,669 |
41,646,036 |
19.95% |
|
Mark-up/return/interest expensed |
26,595,634 |
19,980,873 |
33.11% |
|
Net mark-up/interest income |
23,357,035 |
21,665,163 |
7.81% |
|
Non-mark-up/interest income |
|
|
|
|
Fee and commission income |
3,042,353 |
3,549,097 |
-14.28% |
|
Dividend income |
151,903 |
169,777 |
-10.53% |
|
Foreign exchange income |
2,008,614 |
1,263,768 |
58.94% |
|
Gain/(loss) from derivatives |
(61,228) |
(12,892) |
374.93% |
|
Gain /(loss) on sale of securities |
1,732,773 |
(63,094) |
– |
|
Share of profit from associates |
343,649 |
159,068 |
116.04% |
|
Other income |
45,556 |
133,281 |
-65.82% |
|
Total non-mark-up/interest income |
7,263,620 |
5,199,005 |
39.71% |
|
Total income |
30,620,655 |
26,864,168 |
13.98% |
|
Non-mark-up/interest expenses |
|
|
|
|
Operating expenses |
15,614,254 |
13,940,596 |
12.01% |
|
Workers welfare fund |
275,775 |
255,384 |
7.98% |
|
Other charges |
42,503 |
109,292 |
-61.11% |
|
Total non-mark-up/interest expenses |
15,932,532 |
14,305,272 |
11.38% |
|
Profit before provisions |
14,688,123 |
12,558,896 |
16.95% |
|
Provisions and write offs – net |
4,788,451 |
979,828 |
388.70% |
|
Extra-ordinary/ unusual items |
– |
– |
|
|
Profit before taxation |
9,899,672 |
11,579,068 |
-14.50% |
|
Taxation |
4,121,385 |
5,262,665 |
-21.69% |
|
Profit after taxation |
5,778,287 |
6,316,403 |
-8.52% |
|
Earnings per share – basic (rupees) – Restated |
3.25 |
3.56 |
-8.71% |
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