HMB declares Rs2.5 DPS despite minor profit drop

By MG News | Category Equity | August 23, 2024 at 10:18 AM GMT+05:00

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August 23, 2024 (MLN): Habib Metropolitan Bank Limited (PSX: HMB) reported a 7.46% decrease in profit for the second quarter of 2024, falling to Rs5.82 billion (EPS: Rs5.41). This compares to the Rs6.28bn (EPS: Rs5.83) earned during the same period last year (SPLY).

The Board of Directors (BoD) has also recommended a final cash dividend for the year ended December 31, 2023, at Rs2.50 per share i.e. 25%.

This is in addition to the interim cash dividend already paid at Rs2.50 per share.

The income statement analysis shows that the bank's net interest income (NII) dipped 16.09% to stand at Rs14.75bn, compared to Rs15.58bn in Q2 CY23.

On the other hand, the enhanced economic activity due to monetary easing boosted HMB's non-markup income to Rs5.72bn, up by 42.45% YoY.

This is owing to a rise in Foreign exchange income that was reported at Rs2.12bn, depicting an increase of 41.88% YoY.

Another positive development was the income on securities, which turned into a gain of Rs952.72m, compared to a loss of Rs68.93m in Q2 CY23.

On the expense side, the bank’s non-markup expenses increased by 8.63% YoY to Rs8.26bn in Q2 CY24.

The increase was attributed to the jump of 11.55% YoY in operating expenses from Rs7.21bn in Q2 CY23 to Rs8.04bn in Q2 CY24.

Meanwhile, HMB’s expenses towards the Workers' welfare fund and other charges dropped during the review period.

In addition, the bank incurred a provision expense of Rs1.26bn during the review period.

The bank paid Rs5.13bn on the tax front, 20.12% lower than the amount paid in Q2 CY23.

Consolidated Profit and Loss Account for the first quarter ended June 30, 2024 (Rupees in '000)
	Jun-24	Jun-23	% Change
Mark-up/return/interest earned	61,294,728	52,611,203	16.51%
Mark-up/return/interest expensed	(46,547,134)	(35,035,399)	32.86%
Net mark-up/interest income	14,747,594	17,575,804	-16.09%
NON MARK-UP/INTEREST INCOME
Fee and commision income	2,441,387	2,399,779	1.73%
Dividend income	147,656	147,441	0.15%
Foreign exchange income	2,118,967	1,493,499	41.88%
Income/(loss) from derivatives	-	-
Gain /(loss) on securities	952,722	(68,925)	-1482.26%
Other income	58,563	43,101	35.87%
Total non mark-up/interest income	5,719,295	4,014,895	42.45%
Total income	20,466,889	21,590,699	-5.21%
NON MARK-UP/INTEREST EXPENSES
Operating expenses	8,041,215	7,208,840	11.55%
Workers Welfare Fund	217,612	362,655	-39.99%
Other charges	1,011	32,193	-96.86%
Total non mark-up/interest expenses	8,259,838	7,603,688	8.63%
Profit before provisions	12,207,051	13,987,011	-12.73%
Credit loss allowance and write offs - net	(1,263,327)	(1,282,630)	-1.50%
Extra-ordinary / unusual items	-	-
Profit before taxation	10,943,724	12,704,381	-13.86%
Taxation	(5,128,017)	(6,419,585)	-20.12%
Profit after taxation	5,815,707	6,284,796	-7.46%
Earnings per share - Basic and Diluted (in Rupees)	5.41	5.83	-

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