Published On: Thu, Oct 29th, 2020
Published in Category: Karachi

NBP records highest ever profit for the period ended September 30, 2020

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KARACHI: The Board of Directors of National Bank of Pakistan “the Bank” in its meeting held at Head office Karachi, approved the condensed interim financial statements of the Bank for the periodended September 30, 2020. With strong growth in core earnings, the Bank recorded excellentresults and reported unconsolidated profit after tax of PKR 26.1 billion, up by PKR 9.8 bn or60% compared to the corresponding period last year.

Earnings per share increased to Rs. 12.28against Rs. 7.68 of Sep ’19 and Return on Assets and Return on Equity improved from 0.7% and14.0% in Sep ’19 to 1.2% and 19.7% respectively in the nine months period ended September 30,2020.During the period, the Bank earned gross mark-up/interest income of PKR 206.0 bn (+23.1%YoY), with Investments contributing PKR 124.9 bn (+49.5% YoY) and Loans & Advancesgenerating PKR 78.0 bn (+0.6% YoY). The average interest-bearing liabilities increased 17.5% toPKR 2,458.5 bn and total cost of funds increased to PKR 126.2 bn (+11.1% YoY). However,the cost of deposits dropped by 46 bps to 5.57% for 9M ’20 (9M ’19: 6.03%). Overall, net mark-up/interest income closed at PKR 79.8 bn (+48.2% YoY). The Bank generated non mark-upincome of PKR 27.7 bn (Sep ’19: PKR 25.6 bn) constituting 25.8% of the total income (Sep’19:32.2%).

Accordingly, total revenue closed 35.4% higher at PKR 107.6 bn.Operating expenses of the Bank increased 8.8% YoY to PKR 45.0 bn. However, the Bank’scost-to-income ratio improved to 41.8% as against 52.1% for the same period last year. NPLsincreased during the current nine month by PKR 24.0 bn to PKR 172.7 bn. The Bank follows aprudent approach to strengthening the balance sheet by maintaining a robust level of provisions.Provision charge of PKR 21.8 bn (Sep ’19: PKR 5.9 bn) was created during the period,increasing total provisions to PKR 167.8 bn that translates into a coverage ratio of 97.2%.

The Bank’s balance sheet stood at PKR 2,783.5 bn which is 10.9% lower than the PKR 3,124.4bn at December 31, 2019. This drop is mainly because the Bank reduced its money marketborrowings by PKR 329.16 bn in line with its funding & liquidity position. Investments, thatconstitute the bulk of the asset-mix, dropped marginally by 4.9% to PKR 1,368.4 bn. Due toreduced private sector credit demand and some seasonal adjustments, net advances alsoregistered a decline of 11.5% over Dec ’19 level and closed at PKR 892.6 bn. On the liabilitiesside, deposits remained stable throughout the period and closed at PKR 2,174.9 bn, marginally1.1% down YoY.

The Bank’s Liquidity Coverage and Net Stable Funding Ratio stood at 182%and 263%, comfortably above the statutory requirement of 100%. Also, CASA ratio improved to83.0% from 81.8% at the year-end 2019.