NBP Overtakes UBL and HBL to Become Pakistan’s Most Profitable Bank

The Board of Directors of the National Bank of Pakistan (NBP) met to review the financial performance of the Bank and approved the condensed interim financial statements for the three months ended March 31, 2022.

National Bank of Pakistan has overtaken United Bank Limited and HBL as the most profitable bank.

Accordingly, profit after-tax for the three months period amounted to Rs. 9.84 billion being Rs. 2.1 billion or 27.6 percent higher than Rs. 7.7 billion for Q1’21, the highest ever quarterly profit in the history of NBP.

Despite the continued economic challenges and uncertainties, the Bank has delivered excellent results for its shareholders. This demonstrates the effectiveness of management’s strategies, resilience of the Bank’s business model, and the efforts of our staff during this period.

For the three months period, NBP recorded a Gross Interest Income of Rs. 79.2 billion as against Rs. 48.5 billion in the same period last year. The investment portfolio of the bank generated a mark-up/interest income of Rs. 50.4 billion being Rs. 22.5 billion or 80.8 percent up against Rs. 27.9 billion for Q1’21.

Whereas the loan book generated a mark-up income of Rs. 26.2 billion, i.e., Rs. 6.5 billion or 32.8 percent higher than Rs. 19.7 billion of Q1’21. In line with the YoY increase in average policy rates, the cost of funds for Q1’22 amounted to Rs. 53.4 billion for Q1’22, depicting a 100 percent increase from Rs. 26.9 billion in Q1’21. Accordingly, Net Interest Income for the period under review closed at Rs. 25.8 billion, depicting a 19.4 percent increase against Rs. 21.6 billion of Q1’21.

Non-fund income for the quarter closed at Rs. 8.1 billion, which is lower by Rs. 0.4 billion or 4.7 percent YoY, mainly due to lower capital gains on the back of the lackluster performance of the stock market. Management expects that, going forward, NFI will rebound as the stock market is showing signs of stability following the fading away of COVID-19 and some clarity on the political front. In line with inflationary pressures and industry norms, NBP incurred operating expenses of Rs. 16.7 billion, which is 16.7 percent higher compared to Rs. 14.3 billion in Q1’22, translating into a Cost-to-Income ratio of 49.4 percent.

During this period, asset quality also showed some improvement as non-performing loans increased marginally by 3.0 percent to reach Rs. 203.9 billion, translating into a loan infection ratio of 14.7 percent, showing some improvement against 15.2 percent at the end of 2021 and 16.2 percent on March 31, 2021. Net provision charge for the quarter amounted to Rs. 1.1 billion only, i.e., 65.7 percent or Rs. 2.0 billion lower than Rs. 3.1 billion for Q1’21. With Rs. 180.1 billion held as specific provisions against NPLs, the coverage ratio stood high at 88.3 percent.

As of March 31, 2022, the total assets of the Bank amounted to Rs. 3,740.9 billion, depicting a 2.7 percent drop against Rs. 3,846.7 billion as of December 31, 2021. This decrease was mainly due to a drop in seasonal year-end institutional deposits, which is expected to reverse in the following quarters. Gross advances total amounted to Rs. 1,382.7 billion depicting a YoY increase of 5.9 percent, whereas, with a 3 percent YoY increase, investments amounted to Rs. 1,981.0 billion.

The Bank maintains strong funding and liquidity levels through a diversified funding portfolio. As of March 31, 2022, total deposits amounted to Rs. 2,634.5 billion, with a major share coming from customer deposits that contributed 89.1 percent of total deposits. While the CASA ratio stood high at 83 percent, Liquidity Coverage and Net Stable Funding also remained high at 141 percent and 246 percent, respectively.

Depicting financial soundness well above the minimum regulatory requirements, Total CAR improved to 21.78 percent and Tier-1 Ratio at 16.40 percent compared to 20.39 percent and 15.42 percent, respectively, at YE’21. The leverage ratio was satisfactory at 3.88 percent. With net assets amounting to Rs. 298.3 billion, i.e., 4.2 percent higher than Rs. 286.2 billion at the end of 2021, break-up value per share increased to Rs. 140.2 as against Rs. 134.5 at the end of 2021. The Bank enjoys the highest local credit ratings of AAA/A1+ categories for long term and short term, respectively, as reaffirmed by both PACRA and VIS Credit Rating Company.

Earlier, a cash dividend of Rs. 1.0 per share was recommended by the Board of Directors in their meeting for approval of the audited Annual Financial Statement-2021, subject to approvals of the Federal Government under section 17 of the Banks (Nationalization) Act, 1974 and the State Bank of Pakistan, which have yet to be obtained.

During the last couple of years, the Bank has pursued organizational transformation, product enhancement, digitalization, and initiatives for promoting financial inclusion with a focus on commercial and rural segments.

  • ProPakistani bus aik list jari krdo k konsa bank top pr he kabhi Mezan ko HBL se compare krky overtake ka btaty ho kabhi UBL ka to kabhi NBP ka.. advertising k liye kin kin se paisy liye hen bhai… Hume confuse kia wa aap logon ne b… Top to bottom list jari kro konsi bank top pr he

  • NBP is an average bank it has no match with UBL,MCB,MEZAN this is only book money and even for distribution of rs one dividend to shareholders it is searching for greater than month .Contrary to this UBL distributed greater than 15 rs as dividend. This should be privatized and top management should be handed to NAB

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