MCB's profits suffer considerable decline due to uninhibited administrative expenses

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MG News | October 24, 2018 at 12:57 PM GMT+05:00

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 October 23, 2018 (MLN): Muslim Commercial Bank (MCB) has suffered a decline worth Rs.5.5 billion in profits for the nine month period ended on September 30, 2018, when compared to profits earned during the same period last year.

As per a formal report on MCB’s financial earnings for the period, the institution gained Rs.2.5 billion in net mark-up/interest income after provisions.

However, a heavy decline of 76% in gain on sale of securities, dragged down total non-mark-up /interest income by Rs.1.9 billion. The bank had to bear additional burden on account of administrative expenses which grew substantially, by Rs.5.5 billion.

These components, along with higher taxation weighed down MCB’s profits on the whole, pulling them down from Rs.19 billion to Rs.13.6 billion.

MCB’s basic and diluted earnings per share have also dropped by 31%, as they tumbled down to Rs.11.46 per share.

In addition to this, MCB has also recommended an interim cash dividend at Rs.4 per share (40%) in addition to the interim dividend already paid at Rs.8 per share (80%).

Profit and Loss Account for the nine month period ended September 30,2018 (Rupees '000)

 

Sep-18

Sep-17

% Change

Mark-up/return/interest earned

                     61,534,246

                     56,894,828

8.2%

Mark-up/return/interest expensed

                  (26,401,364)

                  (24,580,169)

7.4%

Net mark-up/interest income

                     35,132,882

                     32,314,659

8.7%

Provision/(reversal) against loans and advances - net

                     (1,910,064)

                     (2,469,249)

-22.6%

Provision/(reversal for diminution in the value of investments - net

                           295,800

                           575,404

-48.6%

Bad debts written off directly

                                     30

                                     14

114.3%

Net mark-up/interest income after provisions

                     36,747,116

                     34,208,490

7.4%

Non mark-up/interest income

 

 

 

Fee, commission and brokerage income

                       8,302,696

                       7,533,178

10.2%

Dividend income

                           724,689

                       1,003,452

-27.8%

Income from dealing in foreign currencies

                       1,356,808

                       1,101,265

23.2%

gain on sale of securities - net

                           977,302

                       4,105,789

-76.2%

Unrealized gain/(loss) of revaluation of investments classified as held for trading

                             (8,236)

                             (5,973)

37.9%

Other income

                           924,414

                           449,747

105.5%

Total non-mark-up /interest income

                     12,277,673

                     14,187,458

-13.5%

Non mark-up/interest expenses

 

 

 

Administrative expenses

                     27,186,042

                     21,623,621

25.7%

Other provision - net

                        (714,499)

                           555,078

-228.7%

Other charges

                           579,932

                           635,891

-8.8%

Total non-mark-up/interest expenses

                     27,051,475

                     22,814,590

18.6%

Share of profit of associates

                           477,014

                           494,867

-3.6%

Extraordinary / unusual item

                                      -  

                                      -  

 

Profit before taxation

                     22,450,328

                     26,076,225

-13.9%

Taxation

                       8,826,823

                       6,953,371

26.9%

Profit after taxation

                     13,623,505

                     19,122,854

-28.8%

Basic and diluted earnings per share (Rupees)

                               11.46

                               16.77

-31.7%

 

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