NBP announced earnings (PAT) today for 4QCY24 at PKR 22.4bn (EPS: PKR 10.6), depicting an uptick of 63% YoY | 7.6x QoQ (4QCY23 EPS: PKR 6.5). This brought full-year CY24 earnings to PKR 26.0bn (EPS: PKR 12.2), down 51% YoY, primarily due to the PKR 49bn pension liability settlement recorded during the year. To highlight, NBP resumed dividend payouts after a gap of seven years (last paid in CY16), announcing a final cash dividend of PKR 8.0/share, its highest-ever annual payout.

Result Highlights       

§  Net Interest Income settled at PKR 65.8bn during 4QCY24, up by 36% YoY and 96% QoQ. With this, the total NII for CY24 went up to PKR 171.4bn, marking a 1% YoY jump. Interest earned surged by 6% YoY during CY24, however, interest expenses also rose, increasing by 7% YoY.

§  The bank’s Non-Funded Income (NFI) surged by 73% YoY during 4QCY24, pushing the total NFI for CY24 to PKR 70.2bn, a remarkable 57% YoY increase. This exceptional growth was primarily fueled by a massive gain on the sale of securities, which soared 6.4x YoY to PKR 28.2bn. Additionally, fee income grew by 21% YoY to PKR 29.2bn, while dividend income rose by 15% YoY to PKR 5.9bn. However, FX income shrunk by 24% YoY to PKR 5.9bn, and other income declined by 68% YoY to PKR 1.1bn.

§  NBP’s provisioning charge for CY24 stood at PKR 4.5bn, significantly lower than PKR 15.4bn in CY23.

§  The provisioning reversal in 4QCY24 was primarily due to the reclassification of the pension liability provisioning under administrative expenses. With that, NBP’s operating expenses (OPEX) surged 3.5x YoY in 4QCY24, reaching PKR 100.6bn (4QCY23: PKR 28.8bn).

§  Cost/Income stood at 75% in CY24 against 45% during same period last year.

§  Effective tax rate was set at 45% during 4QCY24 compared to 55% in SPLY. With this, the effective tax for CY24 stood at 54% (CY23: 48%).

Courtesy – AHL Research