Corporate results: HBL profits surge 18% to Rs11.7 billion

Becomes first bank to have more than Rs1 trillion deposits.

KARACHI:

HBL, the country’s largest bank network-wise, profits grew by 18% to Rs11.7 billion in the six months of 2012 on the back of surge in net interest income and plummeting bad loans.

Core earnings of the bank, net interest income, grew despite the central bank increasing minimum rate on savings account, a feat fellow MCB Bank could not achieve.

Net interest income grew an impressive 8% to Rs54.6 billion due to relatively tighter spreads, according to a Shajar Research note issued on Friday.

The result is in line with market expectation as analysts expected net profit to stand, on average, at Rs11.8 billion.

HBL in another milestone became the first bank to cross the Rs1 trillion mark in deposits.

Profits could have been higher had effective taxation not been 38% during the period under review.

Non-performing loans more than halved to Rs2.2 billion due to an improving asset quality.

On a quarterly basis, the bank posted an earnings decline of 5% to Rs5.7 billion during April to June 2012 compared with the preceding quarter. The sequential decline was largely due to an uptick in provisions and higher admin expenses.

The bank’s stock price declined Rs0.29 to close at Rs117.87 during trade at the Karachi Stock Exchange on Friday.

Published in The Express Tribune, August 11^th, 2012.