UBL: Lower provisions drive profitability by 54% YoY

April 22, 2021 (MLN): United Bank Limited (UBL) has announced its financial results for the 1QCY21 ended March 31, 2021. As per the results, the bank has posted its consolidated net profits of Rs 7.58 billion (EPS: Rs 6.21), i.e., 54.4% higher than the net profits of Rs 4.91 billion (EPS: Rs 3.98) recorded in the same period last year.

Alongside financial results, the board of directors has announced an interim cash dividend for the 1st quarter ended March 31, 2021, at Rs 4 per share i.e., 40%.

The rise in UBL’s consolidated earnings was mainly attributable to lower provision charges.

As per an official report on the bank’s financial earnings, net interest income (NII) inched lower by 1.6% YoY to stand at Rs 17.50 billion due to a 26% YoY decrease in interest income as the full impact of monetary easing reflected on asset yields.

During the period under review, the bank’s non-funded income (NFI) went up by 23% YoY on the back of capital gains that increased by a whopping 4x YoY to Rs 1.87 billion which were attributable to power stocks in view of AKD research. Moreover,  a 42% YoY increase in dividend income along with income from derivatives of Rs 7.25 million also contributed to the financial health of the bank.

Meanwhile, the bank’s provisioning expenses plunged by around 90% YoY to clock in at Rs 376 million during 1QCY21.

On the tax front, the bank paid taxes worth Rs 4.89 billion, up by 44% YoY in 1QCY21.

Consolidated Profit and Loss Account for the Quarter ended on March 31, 2021 (Rupees '000)

 

Mar-21

Mar-20

% Change

Mark-up/return/interest earned

 32,930,550

 44,374,183

-25.8%

Mark-up/return/interest expensed

 15,425,644

 26,584,742

-42.0%

Net mark-up/return/interest income

 17,504,906

 17,789,441

-1.6%

Non-mark-up/interest income

 

 

 

Fee and commission income

 3,469,334

 3,510,113

-1.2%

Dividend income

 252,206

 177,699

41.9%

Foreign exchange income

 524,508

 770,976

-32.0%

Income /Loss from derivatives

 7,254

 (11,274)

Gain on sale of securities – net

 1,874,072

 458,052

309.1%

Other income

 127,885

 174,599

-26.8%

Total non-mark-up /interest income

 6,255,259

 5,080,165

23.1%

Total Income

 23,760,165

 22,869,606

3.9%

Non-mark-up/interest expenses

 

 

 

Operating expenses

 10,784,633

 10,314,814

4.6%

Workers' Welfare Fund

 248,494

 219,422

13.2%

Other charges

 24,547

 181,039

-86.4%

Total non-mark-up/interest expenses

 11,057,674

 10,715,275

3.2%

Share of profit/(loss) of associates

 152,002

 (147,536)

Profit before provisions

 12,854,493

 12,006,795

7.1%

Provisions and write offs-net

 376,332

 3,701,317

-89.8%

Profit before taxation from continuing operations

 12,478,161

 8,305,478

50.2%

Taxation

 4,892,227

 3,400,320

43.9%

Profit after taxation from continuing operations

 7,585,934

 4,905,158

54.7%

Discontinued operation

 

 

 

(loss)/profit from discontinued operations- net of tax

 (33)

 6,505

Profit after taxation

 7,585,901

 4,911,663

54.4%

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

 6.21

 3.98

56.0%

Earnings per share – basic and diluted (Rupees) for profit attributable to the ordinary equity holders of the bank

6.21

3.98

56.0%

 

Copyright Mettis Link News

Posted on: 2021-04-22T11:39:00+05:00

40812