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) |
|||
| Â |
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 | Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â 3,757,530 | Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â 411,440 |
813.3% |
| Other income | Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â 510,517 | Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â 644,381 |
-20.8% |
| Total non-mark-up /interest income | Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â 23,379,048 | Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â 17,094,339 |
36.8% |
| Total Income | Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â 95,137,572 | Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â 92,053,511 |
3.4% |
| Non mark-up/interest expenses | Â | Â | Â |
| Operating expenses | Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â 42,745,343 | Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â 40,060,602 |
6.7% |
| Workers’ Welfare Fund | Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â 1,021,926 | Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â 864,956 |
18.1% |
| Other charges | Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â 198,557 | Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â 167,335 |
18.7% |
| Total non-mark-up/interest expenses | Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â 43,965,826 | Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â 41,092,893 |
7.0% |
| Profit before provision | Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â 51,171,746 | Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â 50,960,618 |
0.4% |
| Provisions and write offs-net | Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â (955,407) | Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â 16,768,148 | Â |
| Profit before taxation from continuing operations | Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â 52,127,153 | Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â 34,192,470 |
52.5% |
| Taxation | Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â 21,245,030 | Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â 13,293,687 |
59.8% |
| Profit after taxation | Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â 30,882,123 | Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â 20,898,783 |
47.8% |
| Earnings per share – basic and diluted (Rupees) for profit from continuing operations attributable to the ordinary equity share | Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â 25.23 | Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â 17.07 |
47.8% |
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