Financial results for half-year PAT PKR15.2 billion up by 36.8 percent YoY

Karachi, September 02, 2020: The Board of Directors of National Bank of Pakistan “the Bank” met on Tuesday, September 01, 2020 and approved the condensed interim financial statements of the Bank for the half-year ended June 30, 2020.

With strong growth in core earnings, the Bank reported unconsolidated Profit After Tax of PKR 15.2 billion, up by PKR 4.1 billion or 36.8 percent compared to the same period last year. Net assets of the Bank increased by PKR 26.4 billion to PKR 259.0 billion (Dec ‘19: PKR 232.6 billion).

During H1 ’20, the Bank earned gross mark-up/ interest income amounting to PKR 145.3 billion which is 49 percent 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, being 92.2 percent higher than that of H1, 2019.

Whereas, net advances averaged at PKR 971.1 billion being 6.6 percent higher than PKR 911.3 billion of Jun ’19, and recorded 18.7 percent 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, being 36.2 percent 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 percent 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 percent higher YoY, translating into Cost-to-Income ratio of 44.2 percent compared to 51.7 percent for H1 ’19. 

The total asset base of the Bank on an unconsolidated basis amounted to PKR 3,163.4 billion which is 1.2 percent higher than PKR 3,124.4 billion as at December 31, 2019. Investments continued to constitute the bulk of the asset-mix and increased by PKR 203.8 billion to PKR 1,643.0 billion, whereas net advances registered a decline of 7.2 percent 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 percent over Dec ‘19, improving the current account mix to 55.1 percent and CASA ratio to 83.1 percent. 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 i.e. ‘Corporate Client Initiative of the Year–Pakistan’ and ‘The Innovative Deal of the Year–Pakistan’ by Asian Banking & Finance Magazine.

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 key element of the strategy already approved by the Board is to support greater financial inclusion via participation in the SME, housing, agriculture and construction sectors. The Bank continues to play its role in supporting those segments which have been under pressure during the slowdown to help them retain their financial flexibility and play their due role in the economy.

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