Profit in 2015 12% higher, EPS increases to Rs21.36. PHOTO: FILE
A stock notice on Wednesday reported earnings per share of UBL at Rs21.36 as opposed to Rs19.32 in 2014, which is largely in line with market expectations.
The board of directors also announced a final cash dividend of Rs4 per share, which takes the cumulative payout in 2015 to Rs13 per share.
The net interest income of UBL amounted to Rs57.8 billion in 2015, up 23% from a year ago. In contrast, the year-on-year increase in the non-interest income of the bank clocked up at 11%. Non-interest income equalled Rs23.6 billion, as the net gains on the sale of securities rose 57% to Rs3.1 billion over the year.
According to AKD Securities, the increase of almost a quarter in the net interest income of the bank was mainly on the back of balance sheet growth. However, heavy provisions also dented UBL’s bottom line, as the former increased 186% to Rs3.8 billion in 2015.
A major chunk of provisions took place in the last quarter alone, which hurt the bank’s profitability on a sequential basis. The quarter-on-quarter decrease in profitability remained 7% in Oct-Dec, as earnings for the last three months clocked up at Rs6.5 billion. The quarterly rise in provisions in Oct-Dec was 125%.
Similarly, the tax expense of UBL increased almost 42% to Rs16.4 billion last year. According to BMA Capital, the effective tax rate increased to almost 38% (from 32.5% in 2014) because of a one-time super tax as well as changes in the tax structure of banks.
As many as 667,300 shares of UBL were traded on the Pakistan Stock Exchange on Wednesday. Its share price recorded a slight drop of Rs0.87 per share to close at Rs152.43.
Published in The Express Tribune, February 18th, 2016.
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