HBL reports over three-fold increase in net profits during 1HCY20

July 24, 2020 (MLN):  Habib Bank Limited (HBL) has announced its financial results for the 1HCY20 ended June 30, 2020. As per the results, the bank has reported over three-fold increase in consolidated net profits to Rs 15 billion (EPS: Rs 10.32). The bank’s consolidated total profit was Rs 3.92 billion (EPS: 2.53) in the same period of last year.

Here, it is pertinent to mention that the bank exceeded market expectations, as its profits were higher than the projections put forth by brokerage houses.

The profitability of the bank went up primarily due to higher net interest income (NII), up by 32% YoY to Rs 63 billion.

According to Ismail Iqbal's research, the major improvement in earnings is the result of higher than expected NII, which they believe it would not be sustainable as lagged impact of interest rate decline on advances would be reflected in 2HCY20 results.

Meanwhile, Non-funded income (NFI) of the bank jumped up by 2.09 times YoY, mainly on account of reduction in exchange losses on FX open position (down by 54%) and capital gains of Rs 6.7 billion against the loss of Rs 2 billion during 1HCY19.

Due to the closure of the New York branch, the operating expenses of the bank increased by only 6% YoY, to Rs 47.67 billion. Moreover, the tax expenses increased by 78% YoY in 1HCY20. 

Consolidated Profit and Loss Account for the half-year ended June 30, 2020 (Rupees '000)

 

Jun-20

Jun-19

% Change

Mark-up/return/profit/interest earned

 143,131,563

 111,090,000

28.84%

Mark-up/return/profit/interest expensed

 80,056,387

 63,386,612

26.30%

Net mark-up/return/profit/interest income

 63,075,176

 47,703,388

32.22%

Non mark-up/interest income

 

 

 

Fee, commission, and brokerage income

 8,899,718

 10,677,330

-16.65%

Dividend income

 196,897

 314,461

-37.39%

Share of profits of associates and joint venture

 1,227,025

 1,328,379

-7.63%

Foreign Exchange Income/(loss)

 (742,336)

 (1,632,651)

-54.53%

Income/(loss) from derivatives

 258,278

 (1,023,516)

Gain/ (loss) on sale of securities – net

 6,706,856

 (2,113,615)

Other income

 97,077

 402,834

-75.90%

Total non-mark-up /interest income

 16,643,515

 7,953,222

109.27%

Total income

 79,718,691

 55,656,610

43.23%

Non mark-up/interest expenses

 

 

 

Operating expenses

 47,672,039

 44,968,345

6.01%

Workers' Welfare Fund

 516,746

 202,309

155.42%

Other charges

 232,608

 81,279

186.18%

Total non-mark-up/interest expenses

 48,421,393

 45,251,933

7.00%

Profit before provisions and taxation

 31,297,298

 10,404,677

200.80%

Provisions and write offs-net

 5,467,852

 510,925

970.19%

Profit before taxation

 25,829,446

 9,893,752

161.07%

Taxation

 10,640,834

 5,966,450

78.34%

Profit after taxation

 15,188,612

 3,927,302

286.74%

Earnings per share – basic and diluted (Rupees)

 10.32

 2.53

307.91%

 

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Posted on: 2020-07-24T15:15:00+05:00

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