FNBM shows positive recovery amid NPL challenges

April 04, 2025 (MLN): First National Bank Modaraba (PSX: FNBM) has shown a positive trajectory in its recovery efforts, despite facing challenges due to provisioning charged on its Non-Performing Loans (NPLs) in compliance with SECP's Modaraba Regulations.

The company has successfully filed recovery suits in court, with favorable decree orders obtained from Banking Courts, and execution proceedings are currently underway.

FNBM’s resilience is evident as it has made significant cash recoveries from its NPLs since its trading suspension in April 2018, reversing provisions and posting net operating profits for four consecutive years since FY 2021.

As a result, the company’s accumulated losses have steadily decreased.

With continued efforts and support from the National Bank of Pakistan (NBP), FNBM is optimistic about complying with the 50% threshold in the next two to three years, and expects further recoveries to help reverse additional provisions.

FNBM has also sought the Modaraba Tribunal’s support in reconsidering the winding-up application, hoping to reach an amicable solution with SECP that would benefit its stakeholders, especially Modaraba Certificate Holders.

The matter remains under adjudication.

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