KARACHI: Bank Alfalah earned an after-tax profit of Rs3.3 billion in the first nine months of 2013, down 2.4% compared to the corresponding period last year, said a notice sent to the Karachi Stock Exchange on Monday.
According to Topline Securities research analyst Zeeshan Afzal, the bank’s lower earnings are mainly because of a 9.8% decline in net interest income to Rs12.5 billion and an 8.7% increase in administration costs.
“We attribute the decline in NII to low banking spread scenario, which averaged 6.26% in the first nine months of 2013 versus 7.14% in the corresponding period in 2012,” he said.
However, he added, a 44% decline in provisions to Rs1.1 billion as opposed to Rs1.9 billion a year earlier supported the falling earnings of Bank Alfalah.
Provisions against loan and advances were down 27% year-on-year and 63% quarter-on-quarter due to the declining trend in the infection ratio, according to Alternate Research analyst Umesh Kumar.
As for non-interest income, it improved 2% on a quarterly basis because the commission and brokerage income declined 11% quarter-on-quarter, dragging down the gains accrued from foreign currency operations and dividend income, he added.
Published in The Express Tribune, October 29th, 2013.
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