UBL earns 15.27bn in Q2 CY24, declares Rs11 dividend

July 31, 2024 (MLN): United Bank Limited (PSX: UBL) earned Rs15.27 billion [EPS: 12.1] in the second quarter of 2024 (Q2 CY2024), which reflects a modest 16.98% growth compared to the reported profit of Rs13.05bn [EPS: 10.39] in Q2 2023.

Along with the financial results, UBL has announced an interim cash dividend of Rs11 per share to reward its shareholders.

This is in addition to the interim Dividend already paid at Rs11 per share in the previous quarter.

A notable fact to mention here is that the bank witnessed this profit boost mainly due to higher non-interest income.

According to the income statement, the bank's net interest income (NII) dropped by 21.97% year-over-year to Rs29.17 billion in Q2 CY24.

This decline occurred because increased interest earnings failed to match the rising interest expenses, which increased by a greater proportion.

UBL’s total non-markup income surged 2.57x YoY to Rs19.3bn, owing to a massive gain on the sale of securities worth Rs5.36bn, compared to a loss of Rs857.78m recorded in the Q2 CY23.

The gains were further buoyed by a rise in Fee, commission and brokerage income which clocked in at Rs5.59bn, due to improved economic activity.

On the expense side, the total non-markup expenses increased by 16.47% to Rs20.36bn in Q2 CY24 compared to Rs17.48bn in Q2 CY23.

The increase was attributed to the jump in both operating costs and charges towards the Workers' Welfare Fund.

The financial statement further shows that UBL reported a credit loss allowance of Rs644.02m during the review quarter, compared to a gain of Rs298.37m recorded in Q2 CY23.

On the tax front, the bank paid Rs13.79bn, 0.54% lower than the amount paid in the same quarter last year.

Additionally, on a 6-month basis, profit totaled Rs31.414 billion in 6M CY24, reflecting a rise of 14.11% compared to earnings in 6M CY23.

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