HBL declared a consolidated profit after tax of Rs 15.7 billion for the first half of 2017 compared to Rs 16.0 billion in H1 2016, showing a drop of 1.9 percent in profitability.
Along with the results, the Bank declared a dividend of Rs3.50per share (35%), bringing the total dividend for the year 2017 to Rs7.0 (70%). Its earnings per share reached Rs10.56.
HBL’s deposits have crossed the Rs 2 trillion mark, driving a 7.4% growth in the balance sheet to Rs 2.7 trillion. Its Pre-tax profit for the first half of 2017 is Rs 27.7 billion.
In the first six months of 2017, the bank added over Rs 105 billion in domestic CASA deposits, and the ratio of domestic current accounts rose to 35.1% in June2017. Increasing demand for private sector credit has resulted in strong lending growth with net advances increasing by 11% to Rs 831 billion.
With all business segments registering significant increases, average domestic loans for H1 17 grew by 28% over H1 16, and average domestic current accounts increased by 17% for the same period. Consequently, despite the spread compression prevalent across the industry, HBL was able to maintain its net interest income for the half year ended June 30, 2017at the previous year’s level of Rs 41.4 billion.
The non mark-up income continued to deliver a strong performance across all business lines, growing by 14% over H1 16 to reach Rs 16.4 billion.
Fees and commissions increased by 9% to Rs 10.2 billion, with the growth coming from core banking businesses, asset management and home remittances. Despite the overall decrease in remittances into Pakistan, HBL successfully channeled higher flows through its counters, further strengthening its market leadership with a 26.6% share.
Income from treasury related activities increased by 21%, to Rs 3.9 billion and contribution from the Bank’s affiliates rose by 29% to Rs 1.9 billion. Non-performing loans reduced further, and total provisions for H1 17 reduced by 19% compared to H1 16.The infection ratio reduced to 8.4% and the coverage ratio strengthened further, to 92.5%.
Even with the healthy loan growth, the Bank was able to slightly increase its consolidated Tier 1 Capital Adequacy Ratio (CAR) to12.1% with the total CAR declining marginally to15.4% compared to December 2016.The capital ratios remain strong and well above regulatory requirements. During this quarter, the Bank’s credit ratings were also re-affirmed by JCR-VIS at AAA/A-1+ for long term and short term respectively with the rating of its subordinated debt also at AAA.
HBL’s reach continues to expand to provide access, convenience and service to its customers across Pakistan. Its network of 1,687 branches is supplemented with more than 2,000 ATMs and over 15,000 POS machines. The Bank has the liquidity and capital strength to accelerate its growth trajectory and, through robust lending growth, has demonstrated its commitment to supporting and participating in the development of the country and the economy.