Corporate Ambassador/KARACHI: Despite crisis triggered by corona, the National Bank of Pakistan has reported 37 percent increase in post-tax profit during first half of 2020.
With an impressive growth in core earnings, the Bank’s unconsolidated Profit After-Tax “PAT” clocked at PKR 15.2 billion, up by PKR 4.1 billion or 36.8% compared to the same period last year. Consequently, net assets of the Bank stand increased by PKR 26.4 billion to PKR 259.0 billion (Dec ‘19: PKR 232.6 billion). The Board of Directors of National Bank of Pakistan approved the financial results of the bank on September 01, 2020 along with the condensed interim financial statements of the Bank for the half-year ended June 30, 2020.
During H1 ’20, the Bank earned gross mark-up/ interest income amounting to PKR 145.3 billion which is 49% higher than PKR 97.7 billion of H1 ‘19. Total earning assets averaged at PKR 2,428.1 billion (Jun ‘19: PKR 1,931.5 billion), of which investments amounted to PKR 1,403.7 billion and generated interest/mark-up income of PKR 85.4 billion, 92.2% higher than that of H1, 2019. Whereas, net advances averaged at PKR 971.1 billion, 6.6% higher than PKR 911.3 billion of June ’19, and recorded 18.7% growth in mark-up income that closed at PKR 57.6 billion. As the Bank incurred cost of funds amounting to PKR 96.8 billion (H1 ’19:PKR 62.1 billion), net mark-up/interest income for H1 ’20 closed at PKR 48.4 billion, 36.2% higher against PKR 35.6 billion earned during the H1 ‘19. Contributing a quarter to the total income, Non-Fund Income “NFI” for this period amounted to PKR 18.3 billion, marginally higher by PKR 0.14 billion or 1% than PKR 18.2 billion of H1, 2019. Despite high inflationary pressures, the Bank did well at keeping a lid on the administrative expenses that clocked at PKR 29.5 billion, being 5.9% higher YoY, translating into Cost-to-Income ratio of 44.2% compared to 51.7% for H1 ’19.
On the financial position side, the total asset base of the Bank on unconsolidated basis amounted to PKR 3,163.4 billion which is 1.2% higher than PKR 3,124.4 billion as at December 31, 2019. On the asset front, investments continued to constitute the bulk of asset-mix and soared by PKR 203.8 billion to PKR 1,643.0 billion, whereas net advances registered a decline of 7.2% over Dec ‘19, clocking in at PKR 935.6 billion. On the liabilities side, the deposit base of the Bank registered an increase of PKR 141.2 billion i.e. 6.4% over Dec ‘19, improving the current account mix to 55.1% and CASA ratio to 83.1%. In June 2020, M/s VIS Credit Rating and PACRA Credit Rating re-affirmed the Bank’s credit rating as “AAA” (Triple AAA), the highest credit rating awarded by the company for a bank in Pakistan.
In recognition of the successful deals and innovative initiatives that made a positive impact for its clients, the Bank has recently been awarded two prestigious awards ‘Corporate Client Initiative of the Year – Pakistan’ and ‘The Innovative Deal of the Year – Pakistan’ by The Asian Banking & Finance-2020.
The bank is revalidating business assumptions with a focus on how the Covid-19 crisis may affect its asset quality and the adjustments needed to contain the impact on the overall business model of the Bank. NBP remains committed to using its earnings to bolster the balance sheet and provisions have been increased substantially. A strategy under immediate consideration of the Board and management of the Bank is that of achieving greater financial inclusion through supporting the retail and consumer segment e.g. housing, agriculture, construction, and transport. The bank aims to help these sectors that have been under pressure during the slowdown and offer opportunities for growth.
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