HBL’s earnings follow a downward trajectory due to higher OPEX

MG News | April 24, 2019 at 03:54 PM GMT+05:00

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April 24, 2019 (MLN): Habib Bank Limited (HBL) has reported Net Profits of Rs. 3.1 billion (EPS: Rs. 2.08) for the first quarter ended March 31, 2019. These figures are approximately 32% lower than those of same period last year.

The bank’s earnings depicted a negative growth due to higher operating expenses, which augmented by 21% owing to continuation of U.S remediation and business transformation costs.

Earnings were further dragged down by higher effective tax rate, owing to 4% super tax imposed on profits of CY17.

However, reversals on provisioning expense and growth in Net interest income by 18% & non-interest income by 22% provided some relief to the earnings.

The bank also announced an interim Cash Dividend for the quarter at Rs. 1.251 per share, i.e. 12.5%.

Profit and loss account for the quarter ended March 31 2019 (Rupees'000)
	Mar-19	Mar-18	% Change
Mark-up / return / profit / interest earned	51,524,112	37,023,051	39.17%
Mark-up I return / profit / interest expensed	28,154,016	17,322,380	62.53%
Net mark-up / return / profit / interest income	23,370,096	19,700,671	18.63%
Non mark-up / interest income
Fee and commission income	5,322,737	4,508,883	18.05%
Dividend income	100,811	169,676	-40.59%
Share of profit of associates and joint venture	891,248	1,064,538	-16.28%
Foreign exchange income / (loss)	452,752	-394,333
Income / (loss) from derivatives	184,516	-83,919
(Loss) / gain on securities - net	-386,628	54,640
Other income	68,712	102,389	-32.89%
Total non-mark-up / interest income	6,634,148	5,421,874	22.36%
Total income	30,004,244	25,122,545	19.43%
Non mark-up / interest expenses
Operating expenses	21,440,589	17,724,046	20.97%
Workers' Welfare Fund	161,195	139,709	15.38%
Other charges	50,652	6,104	729.82%
Total non-mark-up / interest expenses	21,652,436	17,869,859	21.17%
Profit before provisions and taxation	8,351,808	7,252,686	15.15%
Provisions and write offs - net	-82,971	-116,973	-29.07%
Profit before taxation	8,434,779	7,369,659	14.45%
Taxation	5,257,226	2,682,015	96.02%
Profit after taxation	3,177,553	4,687,644	-32.21%
Basic and diluted earnings per share	2.08	3.12	-33.33%

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