LAHORE -  During the nine months period ended September 30, 2017, MCB Bank Limited posted profit before tax of Rs 26 billion and profit after tax of Rs 19.14 billion.

In comparison with the corresponding period last year, profit before tax has decreased by 10.85% whereas profit after tax has increased by 9.83% on account of reversal of prior year tax charges. Net markup income of the Bank was reported at Rs 31.46 billion, down by 6.7% over corresponding period last year, owing to the maturity of high yielding bonds and low-interest rate environment. To supplement its net interest margins, the Bank remained focused on increasing its low cost deposit base and invest in higher yielding assets.

On the non-markup income front, the Bank reported a base of Rs 13.86 billion with incredible growth of 16.8% over corresponding period last year. Major contributions to non-markup income growth are fees & commissions (+25%), dividend income (+22%), and income from dealing in foreign currencies (+58%).

The administrative expense base (excluding pension fund reversal) recorded an increase of 21.72% over corresponding period last year, mainly on account of NIB Bank Limited (NIB) merger with and into MCB Bank Limited in the third quarter of 2017. On the provision front, the Bank continued with its recovery trajectory and posted a reversal in provision against advances of Rs. 2.5 billion, during the nine months period ended September 30, 2017.

The total asset base of the Bank was reported at Rs 1,309.46 billion reflecting a healthy increase of 24.50% over December 2016. Analysis of the asset mix highlights that net investments have increased by Rs 126.34 billion (+22.73%) with net advances increasing by Rs. 92.92 billion (+26.70%) over December 31, 2016. The coverage and infection ratios of the Bank were reported at 93.47% and 10.11%, respectively.

On the liabilities side, the deposit base of the Bank recorded an exceptional increase of Rs 181.07 billion (+23.17%) over December 2016 primarily on account of synergies materializing on account of merger. MCB Bank Limited continued to enjoy one of the highest CASA mixes in the banking industry of 93.45% with strategic focus on current deposits (+23.66%) and savings deposits (+21.34%) over December 2016.

Earnings per share (EPS) for the period came to Rs 16.86 as compared to Rs 15.66 for the same period last year. Return on assets and return on equity were reported at 2.16% and 19.93% respectively, whereas book value per share stood at Rs. 116.54

The Bank remained a well-capitalized institution with a capital base well above the regulatory limits and Basel capital requirements. While complying with the regulatory capital requirements, the Bank has the highest cash dividend per share in the industry with regular interim dividends and remains one of the prime stocks traded in the Pakistani equity markets.

Bank’s total capital adequacy ratio is 17.34% against the requirement of 10.65% (including capital conservation buffer of 0.65%). Quality of the capital is evident from Bank’s Common Equity Tier-1 (CET1) to total risk weighted assets ratio which comes to 15.45% against the requirement of 6.00%. Bank’s well capitalization also resulted in a leverage ratio of 7.78% which is well above the regulatory limit of 3.0%. The Bank enjoys highest local credit ratings of AAA/A1+ categories for long term and short term respectively, based on PACRA notification dated June 19, 2017. Moreover, TFC rating of MCB Bank Limited (Ex-NIB) has been upgraded from A+ to AAA, based on the notification from PACRA dated October 06, 2017.

During third quarter, the Bank has successfully completed the amalgamation of NIB Bank Limited (NIB) with and into MCB.

The Board of Directors declared 3rd interim cash dividend of Rs. 4.0 per share for the nine months period ended September 30, 2017, which is in addition to Rs. 8.0 per share interim dividends already paid to shareholders.