KARACHI: Allied Bank Limited (PSX: ABL) reported a profit after tax of Rs8.48 billion for the quarter ended March 31, 2025, down 26.97% from Rs11.61 billion in the same period last year. Earnings per share declined to Rs7, compared to Rs10 in Q1 2024. The bank also announced a 40% interim cash dividend (Rs4 per share) for its shareholders.
The drop in profitability was mainly driven by a 12.85% fall in net mark-up/interest income, which declined to Rs25.4 billion amid reduced mark-up earned and increased cost of funds. Total income slipped by 7.42% year-on-year to Rs33.25 billion. On the other hand, non-mark-up income posted healthy growth of 16%, reaching Rs7.85 billion, supported by robust gains on securities (up 146%), foreign exchange income (up 36.8%), and improved fee and commission earnings.
However, rising operating expenses—up 17.38% to Rs15.34 billion—continued to weigh on the bottom line. The bank’s profit before taxation dropped by 21.62% to Rs17.71 billion, while taxation dipped 15.97% to Rs9.23 billion.
Despite the earnings decline, ABL’s stock remained relatively resilient in Thursday’s trading session, closing down just 0.28%.
Allied Bank, one of Pakistan’s oldest and most established banks, has consistently delivered strong profitability in recent years. For the full year 2024, ABL reported a record annual profit of Rs36.3 billion, reflecting a 19% year-on-year increase. The bank is known for its conservative risk management and stable asset base. While the first quarter of 2025 saw profitability pressure due to narrowing margins and higher cost inflation, its strong non-mark-up income and continued dividend payout demonstrate management’s confidence in its fundamentals.
