NBP announces dividend and bonus shares

Profit remains unchanged in 2010.

KARACHI: National Bank of Pakistan, the second largest bank by assets, posted a net profit of Rs17.56 billion in 2010, the same as the preceding year.

NBP also announced a final cash dividend of Rs7.5 for every Rs10 share along with a bonus payout in proportion of 25 shares for every 100 shares, according to a notice sent to the Karachi Stock Exchange on Tuesday.

The key reason behind the result is stable interest margins and a decline in provision for non-performing loans, according to analysts.

The bonus share announcement triggered activity in the bank’s stock at the Karachi Stock Exchange as it ended second in the volumes chart with 14.06 million shares, gaining Rs3.4 to close at Rs71.59.

Although net interest income grew by 15 per cent to Rs43.2 billion in 2010, a 16 per cent rise in operating expenses to Rs26.2 billion diluted the impact, according to Topline Securities.

However, overall provision declined by 15 per cent to Rs10 billion while non-markup income dropped by seven per cent to Rs17.6 billion. The decline in non-markup income is primarily due to a one-time impact of gains from sale of National Investment Trust units amounting to Rs3.9 billion which the company booked in 2009, said Topline Securities analyst Farhan Mahmood.

NIB Bank flips from profit to loss

NIB Bank switched to a loss of Rs10.11 billion in 2010 from a profit of Rs691 million last year. Deferred tax stood at a whopping Rs3.02 billion in the period under review compared with a nominal Rs147 million in the preceding year.

The bank has decided to issue 155 per cent right shares at a price of Rs1.37, a discount of Rs8.63 per share, to bolster the bank’s capital and help it meet the challenges over the next few years, said a statement issued to the Karachi Stock Exchange. The bank estimates a loss in 2011 but expects to switch back to profit in 2012.

Summit Bank losses decrease

Summit Bank, formerly known as Arif Habib Bank, recorded a decrease in losses to Rs3.02 billion in 2010 against Rs3.77 billion in 2009.

UAE-based Suroor Investment recently acquired three commercial banks – Arif Habib Bank, Atlas Bank and MyBank – and merged them into Summit Bank. MyBank merger has been approved by both the company’s shareholders and the transaction is expected to be completed this month.

Net interest income rose 26 per cent to Rs968 million during the period under review against Rs766 million in the preceding year.

Published in The Express Tribune, March 2^nd, 2011.