Bank Al Habib Records Highest-Ever Annual Profit

Bank Al Habib Limited has reported its highest-ever profit of over Rs. 35 billion in the calendar year 2023.

According to Arif Habib Limited, BAHL has achieved a historic milestone by recording the highest-ever profitability of Rs. 35.9 billion and a dividend of Rs. 14.0 per share on an annual basis in CY23.

According to the financial results, the profit of the bank grew by 115 percent year-on-year (YoY) compared to the profit of Rs. 16.7 billion reported last year.

In 4Q2023, BAHL recorded a provision of Rs. 5.2 billion, compared to a reversal of Rs. 1 billion in 9M2023. According to Topline Securities, the provision is primarily on account of advances.

Net Interest Income (NII) for 4Q2023 settled at Rs. 39 billion, depicting a strong growth of 70 percent YoY and 14 percent QoQ, attributable to the rise in asset yields. Non-interest income grew by 20 percent YoY and 4 percent QoQ to Rs. 6.2 billion in 4Q2023, primarily driven by Fee & Commission and FX income.

Cost to Income for 4Q2023 increased to 48 percent from 45 percent in 3Q2023, while it decreased from 49 percent in 4Q2022. The full-year 2023 Cost to Income stood at 49 percent.

The effective tax rate of the bank clocked in at 66 percent in 4Q2023, compared to 59 percent in 4Q2022 and 49 percent in 3Q2023. For the full year 2023, the effective tax rate of the bank clocked in at 50 percent.

The stock is currently trading at attractive 2024E P/B and P/E of 0.7x and 2.3x, respectively. Additionally, the stock also offers an attractive dividend yield of 21 percent for 2024.