Imposition of super tax drags Habib Metropolitan’s earnings down by 2%
MG News | April 22, 2019 at 01:42 PM GMT+05:00
April 22, 2019 (MLN): Habib Metropolitan Bank Limited (HMB) has announced its financial results for 1QCY19, as per which the company has posted net earnings of Rs. 1.6 billion, down by 2.09% as compared to same period last year. The bank’s EPS stood at Rs. 1.45 (down, 3.33%)
The Bank initially made a good start by recording an increase in net interest income by 21.8% as a result of interest rate reversals. Similarly, total non-mark-up income grew by 15.8% due to growth in fee income and income from foreign exchange by 27.9% and 68.8% respectively.
The bank’s profits, however, took a U-turn towards south after taxation expense jumped by 87%. This was attributable to higher effective tax rate, given the compulsion on banking sector to record a 4% Super Tax on CY17 profits during 1QCY19, as part of the recent mini budget.
Nevertheless, the bank performed way better than the projections put forward by brokerage houses, which ranged from 12% to 36% decline in Profit after Tax whereas the actual decline was only 2.09%.
| Profit and loss account for the quarter ended March 31 2019 (Rupees'000) | |||
|---|---|---|---|
| Mar-19 | Mar-18 | % Change | |
| Mark-up / return / interest earned | 14,166,590 | 9,927,296 | 42.70% |
| Mark-up / return / interest expensed | -9,537,396 | -6,127,441 | 55.65% |
| Net mark-up / interest income | 4,629,194 | 3,799,855 | 21.83% |
| NON MARK-UP / INTEREST INCOME | |||
| Fee and commission income | 1,193,446 | 932,723 | 27.95% |
| Dividend income | 24,507 | 9,349 | 162.13% |
| Foreign exchange income | 457,628 | 270,977 | 68.88% |
| Income / (loss) from derivatives | - | - | |
| Gain / (loss) on securities | 10,578 | 18,210 | -41.91% |
| Other income | 111,647 | 320,647 | -65.18% |
| Total non-mark-up / interest income | 1,797,806 | 1,551,906 | 15.85% |
| Total Income | 6,427,000 | 5,351,761 | 20.09% |
| NON MARK-UP / INTEREST EXPENSES | |||
| Operating expenses | 3,150,644 | 2,780,117 | 13.33% |
| Workers welfare fund | 61,829 | 49,460 | 25.01% |
| Other charges | 714 | 158 | 351.90% |
| Total non-mark-up / interest expenses | -3,213,187 | -2,829,735 | 13.55% |
| Profit before provisions | 3,213,813 | 2,522,026 | 27.43% |
| (Provisions) / reversal and write offs - net | -133,628 | -97,421 | 37.17% |
| Extra ordinary / unusual items | - | - | |
| PROFIT BEFORE TAXATION | 3,080,185 | 2,424,605 | 27.04% |
| Taxation | -1,476,675 | -786,910 | 87.65% |
| PROFIT AFTER TAXATION | 1,603,510 | 1,637,695 | -2.09% |
| Basic and diluted earnings per share | 1.45 | 1.50 | -3.33% |
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