Bank Alfalah has reported a profit of 5.019 billion in the first quarter of 2022, showing a double-digit growth of 45 percent year-on-year.
During the period under review, the bank’s revenue increased by 31.9 percent backed by strong net interest income and non-interest income growth.
The bank’s net interest margins improved year on year as a result of well thought, focused, and prudent ALM strategy, along with strong deposits growth. The growth continued the upward trajectory with growth momentum in the home remittance business and trade flows, an increase in market share, and higher debit and credit card spending.
Non-markup expenses were 21.6 percent higher compared to the same period last year. This surge was driven by the full-year impact of new branches opened last year along with expenses attributable to new initiatives. The Bank continues to invest in technology, people, and businesses, to improve market share and to become a leading transactions Bank. Despite the investment in multiple initiatives, Bank Alfalah witnessed an improvement in the cost to income ratio to 55.1 percent.
The bank’s quarter-end deposit footing stood at Rs. 1.178 trillion at the end of Q1’22, with YoY growth of 29.0 percent compared to Q1’21. The bank continues to outpace the industry in deposit growth as well as exceptional current account growth. The current and savings accounts achieved impressive YoY growth of 31.0 percent and 35.6 percent respectively. Bank Alfalah’s CASA mix noted an increment to 80.6 percent versus 78.2 percent SPLY that reinforced its clients’ trust in the bank.
The bank grew loans by a record 17.3 percent YoY while maintaining stellar credit discipline and a strong balance sheet with significant capital and liquidity positions. Part of this growth is backed by government-backed schemes for economic development, in which the bank’s delivery of Mera Pakistan Mera Ghar and Prime Minister’s Kamyab Jawan Scheme is ranked amongst the top-performing banks.
The bank not only achieved the targets but also added value to these initiatives of SBP with effective marketing. As of the period’s end, the bank’s gross advances to deposits ratio achieved 60.4 percent, which is one of the highest in the industry. The bank’s non-performing loans ratio stood at 3.4 percent, while the non-performing loans remain fully covered.
Despite the robust growth in advances, the bank remains adequately capitalized, and well above the regulatory requirement with 14.77 percent as of December 31, 2021. This momentum will continue, despite the prevailing uncertainty, since the bank is committed to its strategy of growth, customer-centric approach, and innovation.
