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Habib Bank Ltd realizes 40% increase in annual gains as tax decline saves the day

February 20, 2019 (MLN): Habib Bank Limited (HBL) has realized an upsurge of 40% in bottom-line earnings for Calendar Year 2018, as it recorded its net income at Rs.12.4 billion and EPS at Rs.8.22, up from Rs.8.8 billion (EPS:Rs.5.79) recorded last year.

The saving grace for the bank was the reduction in taxes by Rs.11 billion i.e. 55%, which helped in stabilizing the financial position of the company.  

HBL’s results are in line with the market’s expectation of vast improvement over the year, however the projection closest to the actual results was made by JSL which estimated a rise of 54% in net gains.

The market had attributed this improvement in profitability to lower base in last year as a result of hefty penalty of Rs.23.5 billion.

The financial statement released shows that HBL’s Net mark-up / return / profit / interest income diminished marginally, while Total non-mark-up / interest income dropped by 41% over the year.

Moreover, the pretax profits observed a contraction of 26.8% but the hefty decline in taxation served in favor of HBL and led to a remarkable result.

In addition to this, a final Cash Dividend at Rs.1.25 per share was announced, that is, 12.5%. This is in addition to the Interim Dividend already paid at Rs.3 per share i.e. 30%.

Profit and loss account for the year ended December 31 2018 (Rupees'000)

 

Dec-18

Dec-17

% Change

Mark-up / return / profit / interest earned

165,282,752

148,010,269

11.67%

Mark-up / return / profit / interest expensed

83,605,886

66,177,013

26.34%

Net mark-up / return / profit / interest income

81,676,866

81,833,256

-0.19%

Non mark-up I interest income

 

 

 

Fee and commission income

18,024,117

19,519,052

-7.66%

Dividend income

985,867

1,219,610

-19.17%

Share of profit of associates and joint venture

2,722,983

2,051,887

32.71%

Foreign exchange (loss) / income

-2,397,975

2,753,305

-187.09%

(Loss) / income from derivatives

-907,201

181,376

-600.18%

Gain on securities – net

1,029,880

7,764,681

-86.74%

Other Income

436377

625737

-30.26%

Total non-mark-up / interest income

19,894,045

34,115,648

-41.69%

Total Income

101,570,911

115,948,904

-12.40%

Non mark-up / interest expenses

 

 

 

Operating expenses

77,380,215

61,300,444

26.23%

Workers' Welfare Fund

-2,898,437

1,039,582

-378.81%

Other charges

495,726

31,356

1480.96%

Total non-mark-up / interest expenses

74,977,504

62,371,382

20.21%

Profit before provisions, extra ordinary / unusual item and taxation

26,593,407

53,577,522

-50.36%

Provisions and write offs – net

5,008,578

373,557

1240.78%

Extraordinary / unusual items

 

23,717,115

-100.00%

Profit before taxation

21,584,829

29,486,850

-26.80%

Taxation

9,143,886

20,638,576

-55.70%

Profit after taxation

12,440,943

8,848,274

40.60%

Basic and diluted earnings per share

8.22

5.79

41.97%

 

Copyright Mettis Link News

Posted on: 2019-02-20T13:05:00+05:00

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