Telenor Microfinance Bank reports Rs16.3bn loss for 2019

Loss attributed to provision set aside for credit irregularities which also include fraud

KARACHI: Telenor Microfinance Bank on Wednesday, released its financial statements for the year ending December 31, 2019 announcing a loss after tax of Rs16.35 billion.

According to the financials, the bank’s loss after tax fell from Rs2.51 billion in 2018 to Rs16.35 billion for the year ending December 2019. The bank also reported a revenue of Rs18 billion for 2019.

The bank’s loss per share for the year clocked in at Rs45.25, which is a fall from the loss per share of Rs9.64 during the same period of the previous year.

A part of the loss came from fall in the net interest income which fell from Rs6.1 billion in 2018 to Rs5.6 billion in 2019.

Moreover, during the financial year ended in December 2019, the bank had to set aside a hefty Rs8.81 billion as provisions against non-performing loans, compared to the Rs1.36 billion set aside in 2018. 

This led to the net interest income after provisions to report a loss of Rs3.25 billion in 2019, compared to the income of Rs4.73 billion earned in 2018. 

Meanwhile, the total non-interest income stayed relatively stable at Rs8.5 billion, compared to Rs8.386 billion in 2018. 

However, non-interest expenses shot up, from Rs15.24 billion in 2018, to Rs21.06 billion in 2019. Most of this was due to rise in administrative expenses, which stood at Rs20.8 billion in 2019, compared to Rs14.94 billion in 2018. 

What happened?

In explaining what led to the net loss of Rs16.3 billion, Telenor Microfinance Bank blamed the provision of around Rs8 billion it had to set aside for fraud in the bank, due to an investigation in the bank’s branches that has been ongoing since at least October 2019. 

“While a major part of the net loss is attributed to investments in expanding the digital payments business, the other contributor is credit impairment loss, for which a provision of Rs8.9 billion was made by taking into account expected losses and credit irregularities that also include fraud,” the bank said in a press release.

The bank further explained that in September 2019, irregularities were identified in the loan portfolio, that also included cases of collusion to commit fraud between employees and people outside the bank.

Telenor Microfinance Bank said the fraud was immediately reported to the State Bank of Pakistan (SBP) and a detailed investigation was launched. 

“This is unacceptable to Telenor Microfinance Bank,” the bank said. 

In its press release, the bank also emphasised that the bank took steps to completely strengthen its risk structure and revamp compliance policies, including training and awareness sessions. 

“By following best practices of transparency and confidentiality, actions were also taken against involved employees, ranging from warning letters and terminations to reporting the matter to the law enforcement agencies for further investigation,” the bank revealed. 

In a previous correspondence with Profit over employee terminations, the bank’s spokesperson maintained that the matter was still under investigation, and therefore exact figures could not be given about how many employees were terminated, or how many branches were affected or the size of the suspected fraud. 

Growth indicators

The press release also noted that the bank handled transactions of almost Rs1 trillion through its agent network and served over 10 million customers through its various channels. 

Additionally, the bank’s depositor base grew by 86 per cent to 17.18 million in 2019.

In particular, the bank’s Easypaisa wallet grew substantially, from 3.3 million users in 2018 to 6.4 million mobile wallet users in 2019. Users of the Easypaisa App increased by about 300 per cent to over 2 million, which is the highest number of users of any financial app in Pakistan. The bank invested Rs8 billion in 2019 to further build its payment and lending platform. 

“2019 also saw an increase of 34 per cent in the total value processed per transfer from Mobile Accounts which depicts that customers are adopting money transfer through mobile accounts, as compared to the traditional method of transferring money over the counter,” the bank noted. 

President and Telenor Microfinance Bank CEO and President Mudassar Aqil said: “With the capital injection by our shareholder of $70 million in November, 2019, we are stable and on strong financial footing. We have implemented robust internal controls and risk management policies to further streamline our branch banking business.” 


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Meiryum Ali
Meiryum Ali
The author is a member of the staff and can be reached at [email protected]


  1. Bank is now on its strong footing,
    A bank of small scale and microfinance bank digesting such heavy loss and still got investment means it high brand value strong product and customer confidence.

    Exponential growth even after such incident which cause financial and reputation loss To the bank is proof of good controles

    • In my view Telenor helped a lot in all aspects with the peoples of Pakistan and all over the world,and it is universal fact that when “A” help to “B”, “A” must facing some difficulties but it seemed all time that it is for very short time.After that a confirm success is on way.It is my request to Telenor Management that they should not be disheart.We all are praying for you and will always stand with you at any stage.Thanks To Telenor.

    • Totally failure of management. management took wrong decisions that’s why losses
      Management making phool to groups for getting money ground level is different
      I was also part of that institution I want to show you some thing

  2. Request of Manggo Raja to Telenor Bank Management (Norvay) for investigate the matter of the illegal/ unjustified termination of innocent telenor bank staff in the light of following fact. Do you think that these people can be corrupt if they are corrupt?
    They do not protest and they have so much wealth that they are living a life of luxury. The truth is that their condition is such that they can make banners for protest. And what a fraud those who say this are. There is no shame in such unscrupulous people who come to Facebook without knowing the truth and start starving like dogs. I tell all the people of Sindh to stand up against the tyranny of Telenor and take away your right from them otherwise it will be too late. Now is the time for all to come together and raise their voice against this tyranny.

  3. Gentle questions from telenor Management’s

    1. Have All corruptions been done among the lower staff of bank?

    2. Why those officers have been said good bye respectfully whose responsibility was to review the reports carefully before submission.?

    3. Did telenor not plan to close it’s branches in 2020 and digitalize system? Then why telenor bank terminated employees and destroy their future?

    4. Isn’t it a plot to defame Pakistan internationally. Is it? Those branches that were running well, by transferring new staff got that branches run in default?.

    5. Isn’t it true due to none updation of system customers information issue stands?

    6. Isn’t it true drivers, guards and peons were made BOs against state bank policy?

    If All the question mentioned above are true, then who is the responsible for financial and reputation loss.?
    It’s a pre- planed plot of removing staffs, management adopted a dramatic way not only to fire employees but also destroy their future.

  4. ٹیلی نار کی سخاوت یا دیکھاوا

    Telenor generosity or show off

    I was overwhelmed to see the generosity of telenor presenting 61 million as charity to Pakistan crescent society.

    It seems totally ridiculous, while workers of Telenor bank demonstrating their protest against the management wrong decision that affected thousands of employees nationwide.

    They are compelled to starve along with their families hereby telenor CEO is showing generosity how caring and humble telenor is.

    Telenor bank is doing economical masrassac of it’s employees in Pakistan, ruining their future and life on the basis of so called and fake investigation and telenor upper management showing humbleness and care for people.

    Telenor Pakistan and Norway seem to be blind they can’t see and observe workers protest on social media, in newspaper, workers are asking for their rights but telenor management is deaf enough to hear their voice or may telenor management is doing this on purpose.

    We condemned the generosity of telenor, first give justices to those workers who are victim of telenor bank, give them their rights in case of failure telenor will suffer hveavy financial and reputational loss in Pakistan.

  5. Microfinance Banking is an ancient concept of Commenda that was introduce by Christian Church in Italian City of Rome and Islam adopted as Modaraba. It will never work efficiently and profit making until it is run on the true principles of Modaraba. Why microfinance bank show loss? Operators do not know the mechanism

  6. دراصل ٹیلی نار مائیکرو فنانس بنک کا تمام عملہ انتہائی نالائق بھرتی کیا گیا ہے. انہیں ٹیکنیکل ایشوز کو حل کرنے کا کوئی ادراک نہیں ہے. دوسری طرف نئے اکاؤنٹ بنانے کا بہت زیادہ ٹارگٹ دیا جاتا ہے.اور ہر اکاؤنٹ کے بدلے فرنچائزز کو کمیشن دیا جاتا ہے. اکاؤنٹ کے ٹارگٹ اتنے زیادہ ہوتے ہیں کہ فرنچائز ٹارگٹ پورا کرنے کی پوزیشن میں نہیں ہوتی. اس بات سے فرنچائز کی نگرانی کرنے والے ٹیلی نار کے آفیسر بخوبی واقف ہوتے ہیں. لہٰذا ٹارگٹ کو پورا کرنے کے لیے آفیسرز جعلی اکاؤنٹس بنانے کی مد میں فرنچائز کو طریقے کار بتاتے ہیں اس طریقے سے فرنچائز جعلی اکاؤنٹس بنا کر اپنے ٹارگٹ پورا کر کے کمیشن حاصل کر لیتے ہیں. ٹارگٹ پورا کرنے والے نگران آفیسر کو بھی ٹارگٹ پورا ہونے ہر کمپنی کی طرف سے فوائد حاصل ہوتے ہیں. لیکن دوسری طرف جعلی اکاؤنٹس کا کمپنی کو کسی قسم کا کوئی فائدہ نہیں ہوتا کیونکہ جن کسٹمر کے اکاؤنٹ بنائے جاتے ہیں انہیں معلوم ہی نہیں ہوتا کہ ان کا اکاؤنٹ بنا ہوا ہے. یہ سارا فراڈ کمپنی کے اعلیٰ عہدیداروں کی رضامندی سے ہوتا ہے. دلچسپ بات یہ ہے کہ مائیکرو فنانس بنکنگ فرنچائز میں موجود ناتجربہ سٹاف سے انتہائی کم اجرت کی بنیاد پر کرایا جا رہا ہے. بہرحال تمام تر ذمہ داری حکومت پر عاید ہوتی ہے کہ وہ ان کمپنیوں کی مانیٹرنگ نہیں کرتے.

  7. Is Telenor Microfinance Bank is in the winding up stage in Pakistan and Due diligence has started by the new buyer or this the false news. How much amount so far recovered from total fraud amount. Is there is a depositor protection funds in the balance sheet. Have thet not insured against fraud with banker blancket policy. How secure the funds placed with the bank. Do now they have proper Credit Risk Control Department.

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