February 10, 2022 (MLN): MCB Bank has announced its financial results for the year ended on December 31, 2021, as per which it has reported net profits of Rs31.32 billion (EPS: Rs26.31), i.e., 6% higher than the net profits of Rs29.56bn recorded in the calendar year 2020.
This slender growth in profitability is due to a decline in net interest income (NII), however, a reversal in provision charges and meagre growth in non-funded income (NFI) supported the bottom-line.
The financial result was accompanied by a final cash dividend of Rs5 per share i.e., 50% for the year ended December 31, 2021. This is in addition to interim dividends already paid at Rs14 per share i.e., 140%.
Going by the financial results, the bank’s interest income came down by 9% YoY while interest expenses decreased by 8% YoY, hence MCB’s net interest income (NII) stood at Rs68.38bn, showing a decrease of nearly 10% YoY due to lower policy rate in major part of the period in order to combat the downside risks emanating from the COVID-19 outbreak.
While non-funded income (NFI) of the bank inched up by 7% YoY to stand at Rs20.65bn. Improved transactional volumes and business activities, diversification of revenue streams through continuous enrichment of bank's product suite and investments towards digital transformation supplemented a growth of 14% in fee income whereas dividend and foreign exchange income increased by 2x YoY & 40.7% respectively.
On the expense front, the bank successfully managed its total non-mark-up expenses that clocked in at Rs42.17bn despite sustained inflationary pressures amidst currency devaluation and rising commodity prices,
higher compliance-related regulatory charges and expansion in branch outreach.
The bank reported a reversal of Rs5.47bn on an account of the disposal of equity scrips as against the provision of Rs7.33bn. Proactive monitoring and recovery efforts also led to this reversal. The higher provision charges in CY20 were related to COVID-related general provisions.
|
Profit and Loss Account for the Year ended December 31, 2021 (Rupees '000) |
|||
|---|---|---|---|
|
|
Dec-21 |
Dec-20 |
% Change |
|
Mark-up/return/interest earned |
132,609,303 |
145,772,451 |
-9.0% |
|
Mark-up/return/interest expensed |
64,231,302 |
69,929,012 |
-8.1% |
|
Net mark-up/interest income |
68,378,001 |
75,843,439 |
-9.8% |
|
|
|
|
|
|
Non-mark-up/interest income |
|
|
|
|
Fee and commission income |
13,691,432 |
11,971,491 |
14.4% |
|
Dividend income |
1,955,213 |
969,322 |
101.7% |
|
Foreign exchange income |
3,847,755 |
2,735,228 |
40.7% |
|
Income from derivatives |
14,035 |
4,087 |
243.4% |
|
Loss/Gain on securities |
262,835 |
3,396,296 |
-92.3% |
|
Other income |
883,253 |
192,103 |
359.8% |
|
Total non-mark-up /interest income |
20,654,523 |
19,268,527 |
7.2% |
|
Total income |
89,032,524 |
95,111,966 |
-6.4% |
|
Non-mark-up/interest expenses |
|
|
|
|
Operating expenses |
40,589,732 |
37,763,917 |
7.5% |
|
Workers welfare fund |
1,058,419 |
974,808 |
8.6% |
|
Other charges |
525,339 |
297,987 |
76.3% |
|
Total non-mark-up/interest expenses |
42,173,490 |
39,036,712 |
8.0% |
|
Share of profit of associates |
943,587 |
573,078 |
64.7% |
|
Profit before provisions |
47,802,621 |
56,648,332 |
-15.6% |
|
Provisions/(reversals) and write offs-net |
(5,472,779) |
7,330,044 |
– |
|
Profit before taxation |
53,275,400 |
49,318,288 |
8.0% |
|
Taxation |
21,947,646 |
19,756,019 |
11.1% |
|
Profit after taxation |
31,327,754 |
29,562,269 |
6.0% |
|
Basic and diluted earnings per share |
26.31 |
24.82 |
6.0% |
Copyright Mettis Link News
30741
