UBL declares strong profits of over Rs30bn, DPS of Rs18

February 23, 2022 (MLN): United Bank Limited (UBL) reported profit after tax of Rs30.9 billion (EPS Rs25.2) for the financial year ended 2021, which was 48% higher than 2020.

The Bank maintained strong payouts to shareholders, declaring dividends of Rs18 per share for the year 2021 which was higher than the market consensus, according to a report by Sherman Securities.

The increase in profitability was mainly due to 8x YoY higher capital and 18% YoY increase in fee, commission and brokerage income.

The bank’s net interest income (NII) stood at Rs71.75bn in CY21, lower by 4%YoY. This was due to a 3% YoY decline in interest earned courtesy of asset portfolio repricing at lower yields.

On the other hand, the total non-interest income of the bank posted an impressive growth of 37% YoY to Rs23.4 billion mainly attributable to a higher capital gain of Rs3.75 billion realized on foreign debt securities, up by 8x compared to Rs411.4 million in 2020. The increase in non-markup income was further supported by fee, dividend and FX income which mounted by 18%, 60% and 8% YoY respectively.

The bank also booked a provisioning reversal of Rs955 million during CY21 against a charge of Rs16.8 billion, due to enhanced risk vigilance and strong recovery efforts within both domestic and international businesses.

The bank’s operating expenses were recorded at Rs42.7 billion, growing by 7% YoY. Cost to income ratio remained well controlled at 46% for CY21 compared to 45% last year.

Moreover, the bank’s effective tax rate clocked in at 41% as opposed to 39% last year.

Unconsolidated Profit and Loss Account for the year ended on December 31, 2021 (Rupees '000)

 

Dec-21

Dec-20

% Change

Mark-up/return/interest earned

                  147,974,155

                  152,003,210

-2.7%

Mark-up/return/interest expensed

                     76,215,631

                     77,044,038

-1.1%

Net mark-up/return/interest income

                     71,758,524

                     74,959,172

-4.3%

Non-mark-up/interest income

 

 

 

Fee, commission and brokerage income

                     13,063,973

                     11,097,472

17.7%

Dividend income

                       2,033,934

                       1,269,537

60.2%

Foreign exchange income

                       3,991,545

                       3,684,585

8.3%

Income /Loss from derivatives

                             21,549

                           (13,076)

Gain on sale of securities – net

                       3,757,530

                           411,440

813.3%

Other income

                           510,517

                           644,381

-20.8%

Total non-mark-up /interest income

                     23,379,048

                     17,094,339

36.8%

Total Income

                     95,137,572

                     92,053,511

3.4%

Non mark-up/interest expenses

 

 

 

Operating expenses

                     42,745,343

                     40,060,602

6.7%

Workers' Welfare Fund

                       1,021,926

                           864,956

18.1%

Other charges

                           198,557

                           167,335

18.7%

Total non-mark-up/interest expenses

                     43,965,826

                     41,092,893

7.0%

Profit before provision

                     51,171,746

                     50,960,618

0.4%

Provisions and write offs-net

                        (955,407)

                     16,768,148

 

Profit before taxation from continuing operations

                     52,127,153

                     34,192,470

52.5%

Taxation

                     21,245,030

                     13,293,687

59.8%

Profit after taxation

                     30,882,123

                     20,898,783

47.8%

Earnings per share – basic and diluted (Rupees) for profit from continuing operations attributable to the ordinary equity share

                               25.23

                               17.07

47.8%

 

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Posted on: 2022-02-23T15:49:44+05:00

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