MCB Bank earns profit of Rs14.88 billion in first-half

KARACHI: The MCB Bank Limited on Wednesday announced 11 per cent growth in net profit for the half-year ended June 30, 2021, a bourse filing said on Wednesday.

The profit-after-tax of the bank has been recorded at Rs14.88 billion for the period January–June 2021, compared with Rs13.42 billion in the corresponding period of the last year.

The MCB Bank announced Rs12.56 as earnings per share for the half-year ended June 30, 2021, compared with Rs11.33 in the same half of the last year.

The board of directors of the bank, in its meeting held on August 11, 2021, announced an interim cash dividend for the quarter ended June 30, 2021 at Rs5/share, i.e., 50 per cent. This is in addition to the interim dividend already paid at Rs4.50/share, i.e., 45 per cent.

According to analysts at Arif Habib Limited, the net interest income of the bank settled at Rs33.70 billion, portraying a decline of 12 per cent year-on-year (YoY) during the first-half of 2021, while improving 7 per cent quarter-on-quarter (QoQ), most likely on account of balance-sheet growth.

The net fee income (NFI) has posted a 32 per cent YoY uptick led by capital gains worth Rs535 million against the losses of Rs58 million during the same period of the last year, and improved fee income by 17 per cent YoY.

During the quarter, other income settled at Rs661 million (Rs8 million in the first quarter and Rs61 million during the same period last year), which supported the net fee income.

The spike is on account of sale of some property as per the management. The capital gains clocked-in at 54 per cent lower QoQ and fee income declined 18 per cent QoQ.

The bank booked a significant net reversal of Rs1.8 billion this quarter taking the total reversals to Rs2 billion for the first-half of the current year, which we attribute to improved outlook on the asset quality; following the rebound in the economic activity across the country.

The management expects net reversals of Rs1.5 billion to Rs2 billion for the entire year.

The operating expenses clocked-in higher by 6 per cent YoY during the first-half of the current fiscal year/4 per cent QoQ with the cost/income, settling at 47 per cent during the first-half of the current fiscal year against 42 per cent during the same period last year.

The effective tax rate was 42 per cent during the first-half of the current fiscal year.

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