Meezan Bank earns Rs12.61 billion half-year profit

KARACHI: The Meezan Bank Limited (MEBL) on Thursday announced Rs12.61 billion as the net profit for the first-half of the calendar year 2021.

The net profit registered a growth of 8 per cent during the period under review, compared with Rs11.67 billion in the same half of the last year.

The bank also announced Rs8.91 as earnings per share (EPS) for the period as against Rs8.25 in the same period of the last year.

Alongside the result, the bank also announced an interim cash dividend of Rs1.5/share and a bonus issue of 15 per cent, which is also better than expectations, according to Topline Securities.

On a quarterly basis, the Meezan bank posted its highest-ever quarterly profit of Rs6.5 billion (EPS Rs4.6) in the second quarter of 2021, which is up 5 per cent YoY and 7 per cent QoQ and is also better than industry expectations.

Alongside the result, the bank also announced an interim cash dividend of Rs1.5/share and a bonus issue of 15 per cent, which is also better than expectations.

The earnings remained better than expectations, as the bank registered strong growth in other income (+77 per cent YoY) to Rs3.2 billion, primarily on the back of strong fee and commission income.

The net spread earned by the bank was down 8 per cent YoY (but up 7 per cent QoQ) to Rs16.2 billion in the second quarter of 2021. Strong growth in deposits is likely behind QoQ increase in the net spread of the bank, we believe.

MEBL’s provisioning expenses also declined to Rs148 million in the second quarter of 2021, down from Rs1.5 billion in the same period of 2020, which contributed to higher profits.

The bank continues to fare better than the industry’s average, in terms of loss ratio and coverage.

Other expenses of the bank increased 11 per cent YoY to Rs8.7 billion and remained in line with the expectations