MCB Bank stays buoyant as profits surge by 18% in 9MCY19

By MG News | October 17, 2019 at 12:54 PM GMT+05:00

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October 17, 2019 (MLN): MCB Bank has reported net earnings of Rs. 16.1 billion (RS. 16.63) for the nine months ended on September 30, 2019, i.e. around 18.6% higher than the earnings of same period last year.

The improvement in profits is a result of growth in NII, which in turn is an obvious outcome of monetary tightening implemented by State Bank in July, wherein interest rates surged by 100bps. The NII also rode high on the back of volumetric growth in average earning assets.

On the other hand, non-interest income slumped by 4% owing to decline in income from hedging instruments as well as non-core income by 93% and 72% respectively.

The Board of Directors of the Bank also announced an Interim Cash Dividend for the quarter ended September 30, 2019 at Rs. 4 per share i.e. 40%. This is in addition to dividends already paid at Rs. 8 per share i.e. 80%.

Earlier, MCB had announced that it shall dispose of its wholly owned subsidiary, MCB Financial Services Limited to ISE Tower REIT Management Company Limited and its nominee, namely Infortech (Private) Limited, as a co purchaser.

The aforesaid transaction will take place through ‘Share Purchase Agreement’, for a total consideration of Rs. 89,459,258.

Profit and Loss Account for the Nine Months ended September 30, 2019 (Rupees '000)
	2019	2018	% Change
Mark-up/return/interest earned	105,533,314	61,541,250	71.5%
Mark-up/return/interest expensed	59,508,698	26,392,134	125.5%
Net mark-up / interest income	46,024,616	35,149,116	30.9%

Non mark-up / interest income
Fee, commission and brokerage income	9,048,543	8,620,082	5.0%
Dividend income	828,495	724,689	14.3%
Foreign exchange income	2,214,113	1,836,386	20.6%
Income from derivatives	3,045	43,784	-93.0%
Gain on securities	(186,879)	941,237
Other income	115,393	415,989	-72.3%
Total non-mark-up /interest income	12,022,710	12,582,167	-4.4%
Total income	58,047,326	47,731,283	21.6%

Non mark-up / interest expenses
Operating expenses	28,385,235	27,709,325	2.4%
Workers welfare fund	551,441	466,305	18.3%
Other charges	171,882	107,027	60.6%
Total non-mark-up / interest expenses	29,108,558	28,282,657	2.9%
Share of profit of associates	374,289	477,014	-21.5%
Provisions / (reversal) and write offs - net	1,823,093	(2,524,688)	-172.2%
Profit before taxation	27,489,964	22,450,328	22.4%
Taxation	11,327,158	8,826,823	28.3%
Profit after taxation	16,162,806	13,623,505	18.6%
Basic and diluted earnings per share	13.63	11.46	18.9%

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