KARACHI:
The banking sector widely known as the money making machine in the market gave another strong performance as MCB Bank profits grew 24%, UBL grew 34% while Bank Alfalah bottom-line doubled.
MCB Bank profits firmed to Rs15.53 billion in the first nine months of 2011 as interest income rose by almost Rs9 billion, according to a notice sent to the Karachi Stock Exchange on Tuesday.
The board of directors also announced a dividend of Rs3 per share, taking the total payout to Rs9 per share in 2011.
Net interest income rose 23% to Rs49.6 billion during January to September on the back of higher KIBOR and rising yields on government papers.
The result is slightly lower than market expectation as analyst expected net profit to stand around the Rs16 billion mark.
The bank witnessed a surprise loss of share in associate Adamjee Insurance Company in the previous quarter while administrative expense was higher than expectation, said AKD Securities analyst Raza Jafri.
United Bank Limited profits surged 34% to Rs10.6 billion on the back of strong growth of net interest income, according to its consolidated statement.
Net interest income rose 17% to Rs30 billion during January to September 2011 compared with Rs25.6 billion in the same period last year.
In line with the industry practice UBL has also maintained a strategic shift towards Investment to Deposit Ratio which has grown to 45% in June 2011 compared with 34% last year, according to BMA Capital analyst Sana Bawani.
Bank AlFalah net profit swelled 100% to Rs3 billion in the first nine months of 2011 compared with Rs1.5 billion in the same period last year.
Published in The Express Tribune, October 26th, 2011.
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It should be clear by now that almost all of the banks in developed countries were seriously mismanaged and involved in all types of risky activities leading up to the 2008 financial crisis. Even today, banks in the United States are being recapitalized at the expense of taxpayers and savers.