ABL announced earnings today for 2QCY24 at PKR 12.5bn (EPS: PKR 10.9), depicting an uptick of 25% YoY | 7% QoQ. For 1HCY24, total earnings amounted to PKR 24.1bn, marking a 37% YoY increase. The rise in earnings on a YoY basis is fueled by a jump in total income and provisioning reversals. The bank also announced a cash dividend of PKR 4/share in 2QCY24, taking the total payout for 1HCY24 to PKR 8/share.

Result Highlights       

• The bank’s Net Interest Income (NII) amounted to PKR 29.4bn for 2QCY24, marking a YoY decline of 3%. However, on a QoQ basis, NII showed a slight increase of 1%. The bank faced a rise in interest expenses, which increased by 6% YoY and 5% QoQ. On the other hand, interest income grew by 3% YoY and 4% QoQ.
• The bank’s Non-Funded Income (NFI) surged by 59% YoY during 2QCY24, bringing the total 1HCY24 to PKR 14.2bn, a 21% YoY increase. This increase is largely driven by a gain of PKR 838mn from the sale of securities, up from PKR 211mn in the same period last year. Additionally, fee and commission income surged by 33% YoY to PKR 7.4bn in 1HCY24. However, foreign exchange income saw a 7% YoY decline, amounting to PKR 4.1bn during 1HCY24.
• A significant provisioning reversal was recorded in the outgoing quarter, settling at PKR 2.9bn. This brought the provisioning reversal for 1HCY24 to PKR 3bn, compared to a provisioning charge during 1HCY23 of PKR 2.7bn.
• The bank’s OPEX increased by 18% YoY in 1HCY24, clocking in at PKR 28.9bn (2QCY24: PKR 15.3bn, +19% YoY | +12% QoQ). With this, Cost/Income stood at 41.5% in 2QCY24 against 36.7% in same period last year.
• The effective tax rate was 49.3% during 2QCY24 compared to 54.6% SPLY.

Courtesy – AHL Research