MCB bank reports a 2.77% decline in profit

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MG News | February 06, 2025 at 02:16 PM GMT+05:00

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February 06, 2025 (MLN): MCB Bank Limited (PSX: MCB) disclosed its financial results for the year ended December 31, 2024, reporting a 2.77% decline in profit after taxation, which stood at Rs63.47 billion [EPS: Rs53.35] compared to Rs65.27bn [EPS: Rs54.94] in the previous year.

The company declared a final cash dividend of Rs9.00 per share (90%) for the year, in addition to the interim dividends already distributed, totaling Rs27.00 per share (270%).

An overview of the profit and loss statement reveals that MCB managed to maintain profitability despite a 1.53% increase in net interest income, which reached Rs167.95bn, driven by a 13.47% rise in mark-up/interest earned.

However, a 23.40% surge in interest expenses significantly impacted overall earnings.

The bank's non-markup income showed a 16.51% increase, amounting to Rs41.24 billion, with key contributors being fee and commission income (+10.35%), dividend income (+16.69%), foreign exchange income (+4.53%), and a notable gain on securities (+313.95%).

However, income from derivatives dropped sharply by 87.49%.

On the expense side, non-markup expenses rose 18.87% to Rs75.57bn, primarily due to a 20.62% increase in operating expenses.

Other charges and Workers Welfare Fund expenses showed a mixed trend, with the latter declining 5.30%.

The bank also recorded a 353.68% increase in credit loss allowance and write-offs, reaching Rs4.88bn, impacting overall profitability.

Consequently, profit before taxation fell by 4.61% to Rs131.18bn, while taxation expenses declined by 6.28% to Rs67.71bn.

Despite the challenges, the bank's share of profit from associates surged 81.03%, contributing Rs2.44bn to the overall earnings.

The bank's non-controlling interest also grew 44.62%, reaching Rs240.62mn.

Consolidated Profit and Loss Account for the Year Ended December 31,2024
  Dec-24 Dec-23 %change
Mark-up / Interest Income      
Mark-up / return / interest earned 413,551,319 364,448,721 13.47%
Mark-up / return / interest expensed 245,603,966 199,026,667 23.40%
Net mark-up / interest income 167,947,353 165,422,054 1.53%
Non Mark-up / Interest Income      
Fee and commission income 24,784,627 22,460,483 10.35%
Dividend income 2,929,796 2,510,757 16.69%
Foreign exchange income 9,613,683 9,197,358 4.53%
Income from derivatives 1,982 15,837 -87.49%
Gain on securities - net 3,466,555 837,442 313.95%
Net gains/(losses) on derecognition of financial assets - -  
Other income 443,544 375,874 18.00%
Total non-markup / interest income 41,240,187 35,397,751 16.51%
Total income 209,187,540 200,819,805 4.17%
Non Mark-up / Interest Expenses      
Operating expenses 72,527,182 60,127,915 20.62%
Workers Welfare Fund 2,599,084 2,744,424 -5.30%
Other charges 447,184 701,754 -36.28%
Total non-markup / interest expenses 75,573,450 63,574,093 18.87%
Share of profit of associates 2,441,139 1,348,508 81.03%
Profit before credit loss allowance 136,065,229 138,594,220 -1.82%
Credit loss allowance and write-offs - net 4,878,210 1,075,258 353.68%
Profit before taxation 131,177,019 137,518,962 -4.61%
Taxation 67,711,345 72,247,962 -6.28%
Profit after taxation 63,465,674 65,271,000 -2.77%
Attributable to:      
Equity shareholders of the Bank 63,225,058 65,104,619 -2.89%
Non-controlling interest 240,616 166,381 44.62%
Total 63,465,674 65,271,000 -2.77%
Basic and diluted earnings per share (EPS) (Rupees) 53.35 54.94 -2.89%

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