United Bank Limited (UBL) saw a decline of 1.8 percent in profits in the first quarter of 2016 mainly because of higher administrative expenses reported in its balance sheet.
According to its declared financial results to shareholders, UBL made a profit of 7.29 billion during the period f January to March 2016 as against of Rs 7.12 billion reported in the corresponding period of last year.
UBL major administrative expenses increased to Rs 8.44 billion in the first quarter from Rs 7.32 billion from the similar quarter of last year which mainly created a decline in profit growth in its financial results.
Besides, the net interest income (NII) of the bank decreased by Rs 521 million to Rs 11.8 billion due to low interest rates which have been stable at 6 percent since September 2015. The bank earned Rs 3.17 billion from non-interest sources mainly on gain on sale of securities, fee commission and brokerage income.
The bank expenses also grew significantly by 16 percent to stand at Rs 8.923 billion by end of March 2016.
As far as financial performance is concerned, major investment in long term Pakistan Investment Bonds (PIBs) and improving deposit mix of the sector has helped contain Net Interest Income fall in a declining interest rate scenario.
The bank total revenue earning stands at Rs 20.17 billion. The bank also announced cash dividends of Rs3/share.