The Board of Directors of MCB Bank Limited, met under the chairmanship of Mian Mohammad Mansha on April 26, 2017 to review the performance of the bank and approve the financial statements for the three months’ period ended March 31, 2017.
The bank posted a profit before tax of Rs 9.47 billion and a profit after tax of Rs 6.15 billion, in comparison with the corresponding period last year, the profit before tax has increased by 4.39 pc which is mainly contributed by the 75pc increase in the non-markup income. Net markup income of the bank was reported at Rs 9.74 billion, down by 14.04pc over the corresponding period last year. On the gross markup income side, the bank reported a decrease of Rs 294 million whereas interest expense registered an increase of Rs 1.296 billion over the corresponding period last year, mainly on account of an increase in the repurchase agreement borrowings.
On the non-markup income front, the bank reported a base of Rs 5.18 billion with an exceptional growth of 75 pc over the corresponding period last year. Major contributions of non-markup income are fees and commissions, capital gains and dividend income.
The administrative expense base (excluding pension fund reversal) recorded an increase of 11 pc over the corresponding period last year. On the provision front, the bank continued with its recovery trajectory and posted a reversal in provision of Rs 880 million in the first quarter of 2017.
The total asset base of the bank was reported at Rs 1,246.55 billion, reflecting an increase of 18.51 pc over 2016. Analysis of the asset mix highlights that net investments have increased by Rs 191.66 billion (+34.48pc) with net advances increased by Rs 5.53 billion (+1.59pc) over December 31, 2016. The coverage and infection ratios of the bank were reported at 89.46 pc and 5.68 pc, respectively.
On the liabilities side, the deposit base of the bank recorded an increase of Rs 37.52 billion (+4.80pc) over December 2016. MCB Bank Limited continued to enjoy one of the highest CASA mixes in the banking industry of 94.33 pc with current deposits increasing by 7 pc and savings deposits by 4 pc over December 2016. The strategic focus on current accounts resulted in an increase in the concentration level to 39 pc of the total deposit base.
Earnings per share (EPS) for the quarter came to Rs 5.52, as compared to Rs 5.41 during the same period last year. Return on assets and return on equity were reported at 2.14 pc and 20.70 pc respectively, whereas the book value per share stood at Rs 107.47.
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 18.12 pc against the requirement of 10.65 pc (including a capital conservation buffer of 0.65 pc). The quality of the capital is evident from the bank’s Common Equity Tier-1 (CET1) to total risk weighted assets ratio which comes to 15.80 pc, against the requirement of 6.00 pc. The bank’s good capitalization also resulted in a leverage ratio of 7.61 pc which is well above the regulatory limit of 3.0 pc. The bank enjoys the highest local credit ratings of AAA/A-1+ categories for long term and short term, respectively.
The board of directors declared the first interim cash dividend of Rs 4.00 per share for the three month period ended March 31, 2017.
