HBL made a profit of Rs. 3.17 billion in the first quarter of 2019 as compared with Rs. 4.6 billion last year.
The retrospective imposition of Super Tax on 2017’s earnings lowered the bank’s profit after tax by Rs 1.9 billion. Without this additional tax, HBL’s profit after tax would have been Rs. 5.1 billion, 9% higher than for Q1 2018. On the other hand, operating expenses including Pakistan Super League grew by 21 percent to Rs. 21.6 billion from the previous year.
The earnings per share of the bank stood at Rs. 2.08. Along with the results, the Board declared a dividend of Rs. 1.25/- per share (12.5%). Profit before tax for the three months of 2019 was Rs. 8.4 billion, an increase of 14% over the same period last year.
HBL’s core domestic business continues to strengthen, with all key business drivers on a positive trajectory. Total domestic deposits increased by 2% to Rs. 1.9 trillion and their leading market share increased further, to 14.3%.
HBL’s total advances increased by 1.0% over last year to Rs. 1.1 trillion while its ADR was 54%.
Strong growth in average domestic deposits (growth of Rs. 120 billion over Q1’18) along with a continued strong performance of domestic average advances (growth of nearly Rs. 200 billion over Q1’18) and improvement of Net Interest Margin has contributed to domestic interest income increasing by 17% over Q1’18.
With the rebuilding of HBL’s international business, the bank’s net interest income increased by 19% over the same period last year. Domestic fees grew by 17% YoY, while the total non-fund income of the bank registered a growth of 22% over the same period last year.
Q1 2019 accelerated the business momentum of 2018. This business momentum was underpinned by the launch of technology backed financial products, upgrading compliance & control frameworks, effective governance structures, and aligning with international best practice in most spheres of their work.
Innovation and Digital Banking
As the largest bank in Pakistan, HBL continued to cement its position as the leading digital bank in Pakistan, in the way it conducts business and serves its consumer and corporate customers. HBL plans to shape the future through a shift towards a technology company with a banking license.
The launch of ‘HBL Infinity’ is yet another digital initiative where the bank has expanded their digital product suite to create ease for corporate customers. HBL Infinity is Pakistan’s first innovative online platform that provides a trading experience through real-time FX pricing and execution. It provides HBL customers a more efficient and frictionless digital solution for their trading needs while adhering to SBP’s guidelines on Foreign Exchange.
Moreover, HBL is also the first bank in Pakistan to have Chip & PIN functionality enabled across all new credit and debit cards and acquiring network. The Chip (EMV) cards are more secure as they are more difficult to clone/copy, therefore reducing counterfeiting/fraud, while providing convenience to customers in the use of HBL cards.
Customer data protection is something that HBL is keenly aware of as it marches towards a digital future. The completion of SWIFT CSP (Customer Security Program) to enhance the SWIFT security footprint, is an important initiative to secure electronic transactions undertaken by HBL.
HBL regards customers as their single most important stakeholders and an ever-improving customer service is the true barometer of our business health. The bank has adopted self-assessment tools that are positively impacting their ability to deliver Fair Treatment to Consumers (FTC).
HBL’s Business Transformation work streams entered into their final stages in Q1 2019. The bank’s business processes are now more streamlined than ever and scalable to meet enhanced customer service demands. The bank is now closer to its new business norm of conducting 1st class business in a 1st class way. Moreover, HBL was recognized as Pakistan’s first ISO certified bank, a global endorsement of HBL’s ability to handle various natures of disasters/interruptions in a well-structured manner through a strong business continuity program (BCP) being in place.
As the largest executor of CPEC related financing, HBL’s financial commitment to this transformative economic initiative is without par. Underscoring the bank’s expertise, Pakistan’s first Panda Bond mandate was awarded to a consortium led by HBL comprising China International Capital Corporation Limited (CICC), China Development Bank and Citigroup Global Markets Asia Limited.
HBL continues to support projects that not only add to the economic and commercial strength of the nation but also have a direct contribution to poverty alleviation in the country. HBL played the lead financial role both in the Thar mining & power and the Matiari-Lahore transmission line projects which is an indication of HBL’s resolve in the socio-economic uplift of Pakistan.
Recognition and Awards
During Q1 2019, HBL continued to be recognized for its superior brand, products, and services, as well as for its ability to execute landmark deals. HBL won 2019 Asiamoney Awards for Best Domestic Bank, Best Corporate & Investment Bank and Best Bank for CSR. HBL also won 2019 Global Banking & Finance Awards for the Best Investment Bank Pakistan and Best Sukuk Deal Pakistan. The Asian Banker declared HBL as Best Retail Bank in Pakistan.
HBL’s title sponsorship of the 4th HBL PSL highlights the bank’s efforts towards the development of youth and the discovery of talent for Pakistan. This year, the bank also engaged the overseas Pakistanis in UAE and gave over 1,000 workers an opportunity to witness the exciting games of cricket, free of charge.
The business momentum and accomplishments of Q1 2019 are strong evidence that we remain focused for the balance of 2019, and beyond, in our commitment towards our customers, shareholders and communities at large to take the HBL franchise to the next level.