MCB continues strong fiscal performance with 14pc growth

1330

Staff Reporter

Lahore

The Board of Directors of MCB Bank Limited met under the Chairmanship of Mian Mohammad Mansha, on Wednesday to review the performance of the Bank and approve the condensed interim financial statements for the six months ended June 30, 2019. The Board of Directors has declared 2nd interim cash dividend of Rs.4.0 per share i.e. 40% bringing the total cash dividend for the year ending 2019 to 80%, continuing with its highest dividend payout trend.
MCB reported profit before tax of Rs 18.25 billion which is 14% higher than the corresponding last period and translated into earnings per share of Rs. 9.01 (2018: Rs 8.24).
This was achieved through continuous improvement in the operating efficiencies along with improving margins based on strategic positioning of the asset book. Profit after tax (PAT) of the Bank increased by 9% to Rs. 10.68 billion as the bank recorded super tax @ 4% for the tax year 2018, as enacted through the Second Supplementary Act, 2019; resultantly, effective tax rate for the six months ended June 30, 2019 is reported at 42% which is 3% higher than the corresponding last period.
These are an encouraging set of results, particularly in the context of heightened economic concerns in Pakistan. The Bank remained focused on executing itsoutlined strategy while being alert to risks in the economy.
Net interest income increased to Rs. 27.80 billion, 23% higher than corresponding last period.
Volumetric growth in average earning assets, particularly advances, along with effective mix of shorter maturity earning assets in a rising interest rate scenario enabled the Bank to post a higher gross mark-up income by Rs. 21.42 billion, up 57% over corresponding last period. In-spite of volumetric growth in deposits with re-pricing upon each policy rate change, gross mark-up expense growth curtailed to Rs.16.237 billion.
The non-markup income block of the Bank was reported at Rs.7.9 billion with major contributions coming in from fee commission and foreign exchange income.Fees and commissions generated from core banking businesses increased by 4% to Rs. 5.6 billion. Foreign exchange income increased by 47% to Rs. 1.7 billion as a result of better leveraging of market opportunities. Notwithstanding significant inflationary pressures (June-19 YoY CPI of 8.9%), overall administrative expenses increased by only 7% over corresponding last period excluding pension fund cost.

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