KARACHI: MCB Bank Limited has announced
net profits of Rs22.174 billion for the year ended December 31, 2016, showing a
decline of 11.42 percent as compared to Rs25.034 billion earned last year, a
bourse filing said on Wednesday.
The earnings per share
(EPS) for 2016 clocked in at Rs19.82 as against Rs22.38 in 2015. The bank also
announced a final cash dividend of Rs4/share, which is in addition to the
interim dividend of Rs12/share already paid to the shareholders.
Analyst Amreen Soorani
in a report issued by JS Global said the decline in earnings was due to
unexpected provisioning expenses under loans and advances booked in the fourth
quarter of the year.
The MCB's net interest
income (NII) declined 10 percent to Rs44.79 billion in 2016 as compared to
Rs49.668 billion in 2015, as the bank witnessed hefty PIBs maturity investment
during the year.
Despite high capital
gains, non-core income also slid two percent YoY to Rs16.22 billion, as fee
income dipped 1.02 percent during 2016.
“Nonetheless, the MCB
continued impressive performance in operating expenses with flat growth,
keeping its cost to income ratio in check at 39 percent,” Soorani added.
Analyst Fawad Bashir
in a report issued by Arif Habib Limited (AHL) said the last quarter did most
of the damage, as the profits declined by massive 38 percent to stand at Rs4.3
billion as compared to Rs5.05 billion in the last quarter of 2015.
On the gross markup
income side, the bank reported a decrease of Rs12.97 billion, which was mainly
on account of decreased yields on advances and investments in line with the
interest rate movements.
The administrative
expense base (excluding pension fund reversal) recorded a nominal decrease of
0.67 percent over last year, depicting continued focus on cost control and
deployment of cost-effective measures.
The bank subjectively
downgraded its portfolio in the last quarter of 2016 on prudent basis.
The total asset base
of the bank was reported at Rs1,051.81 billion, presenting an increase of 4.72
percent over 2015.
Analysis of the asset
mix highlights that net investments have decreased Rs9.77 billion (-1.73
percent) and net advances increased Rs43.86 billion (+14.42 percent) over
December 31, 2015.
The coverage and
infection ratios improved to 90.82 percent and 5.90 percent, respectively.
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