April, 27(E. A Report) — Habib Bank Limited (HBL) printed earnings of Rs 13.3 billion, registering a 23% increase.
Announcing its first quarter results Thursday along with the result, the bank announced an interim dividend of Rs 1.5/sh.
Administration expenses jacked up sharply to Rs 40 billion in first quarter, registering an increase of 29% YoY which are to be triggered by the impact of high inflation, rupee devaluation, investment in IT infrastructure and higher compensation expense.
Bank registered net Interest Income shot up by a sizeable 54% yearly led by NIMs expansion as asset books of the bank re-priced.
Balance sheet expansion and the bank’s CA ratio of 40% also cushioned the top-line growth.
On a sequential basis, the surge was recorded at 13% as the impact of 300bps hike in January this year lowed through and to some extent the 100bps hike observed last month.
Going forward, the re-pricing element is expected to keep earnings upwelling over the course of the year.
Regarding non-funded income, reading was softer at Rs 8.6 billion, which was lower by 17/23% YoY/QoQ respectively. The decline was on the back of a massive Rs 6.2 billion loss on the derivatives portfolio while capital losses clocked-in at Rs 1.1 billion.
Sizeable losses on derivatives are expected to result from the sizable 25.3% Rupee depreciation observed in 1st quarter. On the flip side, a 27% year on growth in fee income to Rs 9.3 billion supported the bottom-line.
The surge in fee income was supported by improved card related fee that was up by 45% year on, trade commissions increased 41% year on with increasing interchange fee of 39% and branch banking fee gaining 12%. Forex income was reported at Rs 759 million against Rs 2.5 billion in the SPLY.
Provisioning expenses for the quarter were reported at Rs 3.2 billion against Rs 1.2/4.9 billion booked in SPLY/4QCY22 respectively. Of the Rs 3.2Bn charge, Rs 1.6Bn pertained to the investments book, PKR 1.2Bn to the loan book and Rupee
Effective tax rate for first quarter slid to only 38.3% from the previous quarter as the SBP rolled the advances related tax for current year.
Pakistan Rupee Exchange Rate