Asia > Southern Asia > Pakistan > The Habib Bank Limited (HBL)profit surges 63% to record high

pakistan: The Habib Bank Limited (HBL)profit surges 63% to record high

2015/05/04

The Habib Bank Limited (HBL) on Saturday said it has delivered a record post-tax profit of Rs 10 billion during initial quarter 2015, representing a increase of 63% over the same period last year.

As a result, earnings per share for the quarter increased to Rs6.73 as against Rs 4.12 for the initial quarter of 2014. Along with the results, the Board declared a quarterly dividend of Rs 3.50 per share.

This record performance was driven by strong revenue increase of additional than Rs 7 billion. Net Interest Gain increased significantly by 33% to over Rs 19 billion, as the Bank grew its average Balance Sheet by 17%. The Bank as well built on its success in growing current accounts, which increased on average by a phenomenal 23% year on year and rose to almost 35% of total deposits. Non-mark up gain increased sharply by 44% to Rs7.8 billion for the quarter, with continued excellent performance from bancassurance and investment banking, and realisation of capital gains from sale of securities.

HBL continued to invest in technology, distribution and people, with over 100 new ATMs and 2,500 new POS terminals added to the network. Despite this, administrative expense increase for the quarter was contained at 7.4% YoY. With HBL’s investments delivering strong business increase, the cost/income ratio reduced to 39.4% compared to 49.7% in Q1 2014.

The consolidated Capital Adequacy Ratio improved from 16.2% in Dec 2014 to 16.7% in Mar 2015 reflecting the robust capital position of the Bank. HBL’s Return on Assets improved from 1.4% in Q1 2014 to 2.1% in Q1 2015, while the Return on Equity improved to 26.7%.

During the quarter, the Government sold its entire remaining shareholding in the Bank in a landmark transaction, led by the Privatisation Commission. The issue was oversubscribed by 1.6 times and is a reflection of the price seen by investors in this institution. The transaction size was over USD 1 billion and is the major ever equity offering, not just in Pakistan, but in Asian Frontier Markets. Additional than 75% of the proceeds came from foreign investors covering all significant investment locations and inclunding major International Financial Institutions.

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