MCB bank reports a 2.77% decline in profit

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

0:00

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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