Islamabad, Oct 30: NBP Profit Down by Whopping 91% in 9 Months of 2024 Amid Economic Challenges
NBP reported 3QQ24 earnings of Rs. 2.96 billion (EPS: Rs. 1.39), up from the previous quarter’s loss of Rs. 9.1 billion but a notable 76 percent YoY drop.
Total earnings for 9MCY24 were Rs. 3.5 billion, which is a YoY decline of 91%. According to Arif Habib Limited (AHL), reduced net interest income was the main factor contributing to the YoY decline in profitability in the most recent quarter.
For 3QCY24, the bank’s net interest income was Rs. 33.6 billion, which represented a 22 percent QoQ and a 29 percent YoY drop. Interest income decreased 8.5 percent year over year and 5.7 percent quarter over quarter, while interest expenses decreased 4.5 percent year over year and 2.9 percent quarter over quarter.
The bank’s non-funded income increased by 94.8 percent year over year in 3QCY24, resulting in a 47.3 percent YoY growth to Rs. 40.8 billion in 9MCY24. A
significant increase in foreign currency income, which increased to Rs. 5.4 billion from Rs. 2.8 billion in the same period previous year, and a 19.3% YoY gain in fee income, which reached Rs. 19.6 billion, were the primary drivers of this expansion in 9MCY24.
The bank also reported a gain of Rs. 10.5 billion from the sale of securities, which represents a 331 percent YoY increase.
The total provisioning charge for 9MCY24 was Rs. 1.9 billion, down from Rs. 9.6 billion in 9MCY23, due to a provisioning charge of Rs. 2.9 billion in the previous quarter. As you may remember, the bank also recorded a pension charge of Rs. 49 billion in 9MCY24 as an unusual item.
OPEX for the bank increased 19% year over year to Rs. 79.5 billion in 9MCY24 (3QCY24: Rs. 29.3 billion, up 34.9 percent YoY and 6 percent QoQ). As a result, the Cost/Income ratio rose from 40 percent in the same period last year to 62.8 percent in 3QCY24.
Additionally, the effective tax rate increased from 46.9 percent SPLY to 78.6 percent in 3QCY24, most likely as a result of costs connected to ADR.
