Home Equity BOP’s profits dip slightly on capital loss, higher interest expenses

BOP’s profits dip slightly on capital loss, higher interest expenses

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August 17, 2022 (MLN): The Bank of Punjab (BOP) reported net profits for 1HCY22 at Rs5.4bn (EPS: Rs1.8), depicting a slight decline of 2.4% YoY, mainly due to loss on securities and higher interest expenses.

The net interest income of the bank settled at Rs15.9bn during 1HCY22, increasing 14% YoY. Non-interest income dropped by 17.2%YoY, primarily due to capital loss worth Rs861 million booked during the period compared to gains of Rs1.6bn in the corresponding period last year.

Excluding capital loss, non-interest income reported an improvement of 62%YoY led by a 35.5%YoY increase in fee and commission income and a 4.9x YoY increase in income from foreign exchange operations.

On the expense side, operating expenses reported a significant increase of 36.5% YoY, from Rs10.2bn to Rs13.97bn. With this, the cost-to-income ratio stands at 72% compared to 57% in 1HCY21.

Moreover, the bank posted a huge reversal during the review period, clocking in at Rs2.94bn compared to the provisioning charge of Rs632mn recorded in the same period last year which provided a cushion to the bank’s profitability.

Lastly, the effective tax rate was set at 35% during 1HCY22 against 24% last year.

Profit and Loss Account for the half year ended June 30, 2022 (Rupees in '000)

 

Jun-22

Jun-21

% Change

Mark-up/return/interest earned

    58,937,443

            38,927,588

51.40%

Mark-up/return/interest expensed

    43,015,246

            24,984,717

72.17%

Net mark-up/return/interest income

    15,922,197

            13,942,871

14.20%

NON-MARK-UP/INTEREST INCOME

 

 

 

Fee and commission income

       3,403,914

               2,512,352

35.49%

Dividend income

          221,549

                  105,001

111.00%

Foreign exchange (loss) income

          685,798

                  140,764

387.20%

Income/(loss) from derivatives

                      –  

 –

 

Gain / (loss) on securities – net

        (861,011)

               1,614,972

Other income-net

          198,440

                     34,202

480.20%

Total non-mark-up/interest income

       3,648,690

               4,407,291

-17.21%

Total Income

    19,570,887

            18,350,162

6.65%

NON-MARK-UP/INTEREST EXPENSES

 

 

 

Operating expenses

    13,970,580

            10,233,070

36.52%

Worker’s welfare fund

          147,071

                  167,415

-12.15%

Other charges

             33,794

                           502

6631.87%

Total non-mark-up/interest expenses

    14,151,445

            10,400,987

36.06%

Profit before provisions

       5,419,442

               7,949,175

-31.82%

(Reversal) / Provisions and write offs – net

    (2,940,463)

                  632,328

 

Extra ordinary/unusual items

                      –  

                              –  

Profit before taxation

       8,359,905

               7,316,847

14.26%

Taxation

       2,949,314

               1,772,948

66.35%

Profit after taxation

       5,410,591

               5,543,899

-2.40%

Earnings per share – Basic and Diluted (in Rupees)

                 1.80

                         1.85

-2.70%

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Posted on:2022-08-17T17:58:03+05:00

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