LAHORE: The MCB Bank Limited, having fourth largest deposit base in Pakistan, earned Rs25.551 billion for the year ended December 31, 2015, up five percent over the preceding year.
Analysts said the higher interest and non-interest income and exorbitant gains on sales of securities improved the bottom line.
The bank’s board of directors on Tuesday declared a final cash dividend of Rs4/share for 2015, which was in addition to Rs12/share interim dividends already paid to the shareholders. The dividend is for the shareholder whose name will appear in the register of members on March 20, 2016. This is in addition to interim dividends already paid at Rs12/share.
The board met under the chairmanship of Mian Mohammad Mansha to review the performance of the bank.
The bank reported a profit before tax of Rs42.333 billion in 2015, up 15 percent over 2014.
Earnings per share for the year were declared at Rs22.96 as compared to Rs21.85 for the year ago. Return on assets and equity were reported at 2.62 percent and 23.25 percent, respectively, whereas book value per share stood at Rs. 101.44.
The net interest income after adjustment of provisions for loans and bad debts improved 7.52 percent to Rs49.55 billion in the year from Rs43.64 billion earned last year.
“The earnings are still protected by the buffer on earnings through investments, which historically accounts for 60 percent (2011 to 2014) of total interest earned,” said analyst Syed Fawad Basir at Arif Habib.
Analyst Umair Naseer at Topline Securities said deterioration in macroeconomic indicators, soft credit growth and “reinvestment risk in 2016 after maturity of Pakistan Investment Bonds,” are key risks for MCB.
“We maintain our ‘buy’ call on MCB. The stock currently trades at 2016E PE (price earning) of 8.8x and PBV (price by volume) of 1.5x with ROE (return on equity) of 20 percent,” Naseer said.
Non-markup income of the bank increased to Rs.17.115 billion in 2015. The increase in non-markup income was due to capital gains, which increased Rs2.780 billion. Gain on sales of securities surged 2.5-fold to Rs4.34 billion in the year under review.
The bank’s fee, commission and brokerage income rose 16 percent to Rs8.99 billion from Rs7.77 billion. Dividend income increased to Rs861.38 million from Rs729.70 million. Income from dealing in foreign currencies, however, declined 43 percent to Rs771.68 million. And, other income, under the head of non-interest income, jumped 33 percent to Rs2.09 billion in 2015.
On the gross markup income side, the bank recorded an increase of Rs3.263 billion with major contribution from investments income. On the interest expense side, the bank registered a decrease of Rs2.546 billion, which was in line with the falling interest rate environment.
The total asset base of MCB Bank Limited was reported at Rs1.017 trillion in 2015, signaling a healthy growth of nine percent over 2014. The quality of its asset base registered a continuous improvement, as non-performing loans of the bank decreased Rs1.539 billion to Rs20.369 billion during the year.
Coverage ratio of the bank was reported at 90.83 percent with infection ratio improving to 6.12 percent as on December 31, 2015 as compared to 6.80 percent as on December 31, 2014.
On the liabilities side, the bank’s deposits increased three percent to Rs708.091 billion as on December 31, 2015. On the deposits mix front, current deposits increased 10 percent to Rs259.818 billion, improving the CASA (current account, saving account) ratio to 93 percent as compared to 91 percent.
Attock Petroleum profit rises 12 percent
Attock Petroleum Limited's net profit rose 12 percent for the half-year ended on December 31, 2015 as petroleum prices remained largely stable, analysts said on Tuesday.
The oil marketing company reported net profit at Rs1.64 billion for the half-year under review against Rs1.46 billion in the previous year. The earnings per share remained at Rs19.78 as compared to Rs17.69 in the corresponding period last year, the firm announced at the Pakistan Stock Exchange.
Board of directors has recommended interim cash dividend at Rs15/share.
Muhammad Affan Ismail at BMA Capital said the growth in earnings could primarily be attributed to 27 percent higher gross profit (at Rs2.38 billion), largely explained by absence of inventory loss amid relative stability in petroleum prices.
The petroleum prices downed between two-four percent versus a notable decline of 14-22 percent in the same half last year, he said.
Net sales of the firm declined 39 percent to Rs60.84 billion from Rs100.15 billion in the corresponding period. The decline in sales can be attributed to downward trend in oil products at the world market. Otherwise, the quantities sales remained comparatively higher.
The other income fell 30 percent to Rs455.11 million from Rs649.55 million. Finance income remained steady at Rs585.85 million from Rs582.07 million. The finance cost declined 14 percent to Rs83.49 million from Rs96.79 million.
Alone in the quarter ended December 31, 2015, the net profit jumped 4.5-fold Rs949.27 million (EPS at Rs11.44) as compared to Rs209.08 million (EPS at Rs2.52) in the same quarter last year.
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