MCB Bank 2Q earn­ing per share declines by 9pc

The Pak Banker - - FRONT PAGE -

MCB Bank 2QCY15 earn­ing per share has clocked in at PKR5.06, down 9% against PKR5.58 dur­ing the cor­re­spond­ing pe­riod last year, a re­port said. MCB also an­nounced a cash pay­out of PKR4.0/sh, tak­ing 1HCY15 pay­out to PKR8.0/sh, up 23% YoY, it was said.

How­ever, the bank posted 1HCY15 PAT at PKR13.5bn, trans­lat­ing into EPS of PKR12.17, up 15% against the same pe­riod last year, it was re­ported.

The re­port said MCB posted ro­bust in­crease of 55% YoY in its non-in­ter­est in­come which was largely driven by a sharp spike in non-funded in­come (NFI) of the bank which alone con­trib­uted 54% to the non-in­ter­est in­come post­ing growth of 32% to PKR2.3bn against PKR1.0 bn dur­ing the cor­re­spond­ing pe­riod last year. This was pri­mar­ily a re­sult of in­creased re­mit­tances dur­ing the 2QCY15 to­gether with growth in busi­ness from Ban­cas­sur­ance, the re­port added say­ing other com­po­nents of the non­in­ter­est in­come, on the other hand, grew by 93% on a cu­mu­la­tive ba­sis.

Div­i­dend in­come posted growth of 50% on a YoY ba­sis in­di­cat­ing the strength of the bank's eq­uity port­fo­lio. Other in­come of the bank posted stel­lar growth of 6.94 against the cor­re­spond­ing pe­riod last year largely due to com­pen­sa­tion on de­layed re­funds amount­ing to

PKR699mn which is non-re­cur­ring in na­ture. The re­port said to­tal rev­enues there­fore clocked in at PKR17bn dur­ing 2QCY15, up 21% YoY.

The re­port said that MCB con­tin­ued to post im­prove­ment in its as­set qual­ity as non-per­form­ing loans (NPLs) stock of the bank fell by 1% dur­ing 1HCY15 and key as­set qual­ity ra­tios of the bank also posted im­prove­ment. In­fec­tion ra­tio clocked in at 11.2% dur­ing 2QCY15 against 12.5% dur­ing the cor­re­spond­ing pe­riod last year while NPL cov­er­age ra­tio clocked in at 89% largely flat on YoY ba­sis, the re­port fur­ther said. The bank also posted a NPL re­ver­sal charge of PKR40mn dur­ing the quar­ter. Mean­while MCB held its con­fer­ence call to dis­cuss the 1HCY15 re­sults yesterday. The meet­ing dis­cussed five points. The bank dis­closed its tilt to­wards in­creas­ing its Tbills port­fo­lio rather than PIBs dur­ing the cur­rent year. A large pro­por­tion of these TBills have a ma­tu­rity of 6 months.

The meet­ing also dis­cussed PIB port­fo­lio of the bank which has a ma­tu­rity of 2.5 years to 5 years. The bank is op­ti­mistic in terms of in­creas­ing credit off-take to per­sonal or mort­gage fi­nanc­ing. On the other hand, man­age­ment sug­gests that low dis­count rates have failed to stir pro­ject fi­nanc­ing up.

The bank is fo­cus­ing on fer­til­izer and chem­i­cal sec­tor, for its cor­po­rate book. It was also dis­cussed that man­age­ment of the bank is tar­get­ing 9% to 10% growth in ad­vances and weighted av­er­age yield on PIBs and TBills at the mo­ment is 11.67% and 8.54% re­spec­tively.

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