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Month: February 2021

  • PPL declares 18pc decline in gross profit in first half

    PPL declares 18pc decline in gross profit in first half

    KARACHI: Pakistan Petroleum Limited (PPL) on Friday declared 18 percent decline in its gross profit for the period July – December 2020.

    However, drastic reduction in exploration expenses and other charges the net profit (after payment of tax) of the company managed to post a growth of 7 percent for the period.

    The company declared Rs42.2 billion as gross profit for the first half of 2020/2021 as compared with Rs51.39 billion in the corresponding half of the last fiscal year.

    The major fall in gross profit may be attributed to revenue which fell to Rs75.54 billion for the six month period ended December 31, 2020 as compared with Rs85.41 billion in the same period of the last fiscal year.

    The company declared profit after tax of Rs26.27 billion for the first half of the current fiscal year as compared with Rs24.55 billion in the same period of the last fiscal year.

    The growth in after tax profit can be attributed to drastic reduction in expenses of the company.

    The cost of exploration has been reduced to Rs3.146 billion during the first half of the current fiscal year as compared with Rs11.74 billion in the corresponding period of the last fiscal year.

    The cost of other charges also fell to Rs3.88 billion for the half under review as compared with Rs7.32 billion in the corresponding half of the last fiscal year.

    PPL announced earnings per share at Rs9.64 for the first half ended December 31, 2020 as compared with Rs9.02 EPS declared in the same half of the last year.

  • UBL declares Rs20.9bn as annual after tax profit

    UBL declares Rs20.9bn as annual after tax profit

    KARACHI: United Bank Limited (UBL) on Thursday announced its financial results for the year ended December 31, 2020. The bank made provisioning and write-offs to the tune of Rs16.77 billion or 104 percent higher which trimmed its annual profit growth to 9.25 percent.

    The bank announced an amount of Rs20.9 billion as profit after tax for the year ended December 31, 2020 as compared with Rs19.13 billion profit after tax in the preceding year.

    The bank made provisioning and write-offs an amount of Rs16.77 billion for the year under review as compared with Rs8.22 billion in the preceding year.

    UBL announced earnings per share at Rs17.07 for the year ended December 31, 2020 as compared with Rs8.22 in the preceding year.

    Net interest income of the bank increased by 21.42 percent to Rs75 billion for the year under review as compared with Rs61.77 billion in the preceding year.

    Total income of the bank posted 10.24 percent growth to Rs92 billion as against Rs83.45 billion.

    Operating expenses of the bank were flat at Rs40.66 billion as compared with Rs40.21 billion.

    UBL announced a final cash dividend for the year ended December 31, 2020 at Rs9.50 per share i.e. 95 percent. This is in addition to interim dividend already paid at Rs2.50 per share i.e. 25 percent.

    UBL gets DD approval to acquire Telenor Microfinance Bank
  • Bank irrationally deducts withholding tax from tax filer

    Bank irrationally deducts withholding tax from tax filer

    KARACHI: A bank has deducted irrationally a huge amount as withholding tax from transactions made by an account holder.

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  • IR offices work on Saturday for collection target

    IR offices work on Saturday for collection target

    ISLAMABAD: The offices of Inland Revenue shall observe Saturday February 27, 2021 as normal working day in order to achieve revenue collection target for the month.

    In a notification issued on Thursday, the FBR said that all Large Taxpayers Offices (LTOs), Medium Tax Office (MTO), Corporate Tax Offices (CTOs) and Regional Tax Offices (RTOs) would remain open and observe normal working day on Saturday, February 27, 2021 to facilitate the taxpayers in payment of duty and taxes. However, extended working hours till 8:00 PM will be observed by officers / officials who are monitoring incharge of collection of duty and taxes.

    The FBR directed Chief Commissioner Inland Revenue to establish liaison with State Bank of Pakistan and authorized branches of National Bank of Pakistan (NBP) to ensure transfer of tax collection by these branches on February 27, 2021 to the respective branches of the SBP on the same date so as to account for the same towards the collection for the month of February 2021.

  • FATF keeps ‘grey’ status for Pakistan despite significant progress

    FATF keeps ‘grey’ status for Pakistan despite significant progress

    ISLAMABAD: Financial Action Task Force (FATF) on Thursday kept Pakistan in its grey list despite acknowledging significant progress made by the country.

    “As all action plan deadlines have expired, the FATF strongly urges Pakistan to swiftly complete its full action plan before June 2021,” a statement of the FATF said. 

    The FATF takes note of the significant progress made on the entire action plan. “To date, Pakistan has made progress across all action plan items and has now largely addressed 24 of the 27 action items,” according to the note.

    Since June 2018, when Pakistan made a high-level political commitment to work with the FATF and APG to strengthen its AML/CFT regime and to address its strategic counter-terrorist financing-related deficiencies, Pakistan’s continued political commitment has led to significant progress across a comprehensive CFT action plan, including by: demonstrating that law enforcement agencies are identifying and investigating the widest range of TF activity, demonstrating enforcement against TFS violations, and working to prevent the raising and moving of funds including by controlling facilities and services owned or controlled by designated persons and entities.

    Pakistan should continue to work on implementing the three remaining items in its action plan to address its strategically important deficiencies, namely by:

    (1) demonstrating that TF investigations and prosecutions target persons and entities acting on behalf or at the direction of the designated persons or entities;

    (2) demonstrating that TF prosecutions result in effective, proportionate and dissuasive sanctions; and

    (3) demonstrating effective implementation of targeted financial sanctions against all 1267 and 1373 designated terrorists,  specifically those acting for or on their behalf.

  • FBR amends law for sales tax recovery

    FBR amends law for sales tax recovery

    The Federal Board of Revenue (FBR) has amended tax laws to legally authorize the direct recovery of sales tax amounts from the bank accounts of tax defaulters.

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  • Weekly foreign exchange reserves ease to $20.042 billion

    Weekly foreign exchange reserves ease to $20.042 billion

    KARACHI: The weekly position of foreign exchange reserves of the country eased to $20.042 billion by week ended February 19, 2021, the State Bank of Pakistan (SBP) said on Thursday.

    The foreign exchange reserves of the country were at $20.059 billion by week ended February 12, 2021.

    The official foreign exchange reserves held by the central bank slightly increased to $12.909 billion by week ended February 19, 2021 as compared with $12.890 billion a week ago.

    Similarly, the foreign exchange reserves held by the commercial banks fell to $7.133 billion by week ended February 19, 2021 as compared with $7.169 billion a week ago.

  • SBP asked to restore biometric verification for online banking services

    SBP asked to restore biometric verification for online banking services

    KARACHI: The Banking Mohtasib has asked the State Bank of Pakistan (SBP) to restore the verification through biometric system for activation/re-activation of online banking services.

    The non-availability of biometric verification system is creating unsafe environment for banking customers, according to annual report for the year 2020 issued by the office of Banking Mohtasib Pakistan on Thursday.

    The Mohtasib said that the SBP vide its PSD Circular No. 9 of 2018, (dated November 28, 2018), made it mandatory for banks to have biometric verification at any branch of their banks for activation/ re-activation of online banking services, including internet/mobile banking for their customers.

    The above instructions were suspended vide PSD Circular No. 2 of 2020 (dated March 18, 2020) which inter-alia was one of the measures to control the spread of pandemic of COVID-19.

    However, it has been observed from complaints received in Banking Mohtasib Pakistan office that the fraudsters are taking advantage of suspension of bio-metric verification conditionality as since suspension the number of complaints relating to IBFT/internet banking transactions are increasing day by day.

    “The SBP is, therefore, recommended to lift the suspension, if considered appropriate, or some alternate for bio-metric be introduced to reduce/avoid miseries of innocent account holders.”

    In other recommendations to SBP, the Banking Mohtasib office pointed out systemic deficiencies and control weaknesses within banks.

    Such weaknesses are brought to the attention of banks’ senior management. For issues of a serious nature, a report is submitted to the State Bank of Pakistan for action as it may consider appropriate.

    Some of the issues which have been brought to the notice of State Bank of Pakistan for appropriate regulatory intervention are as under:

    • It has been observed that instructions issued by SBP from time to time vide their different circulars are not followed by banks in letter and spirit. One of the reasons may be the inflow of variety of circulars and change in instructions or various modifications on the same subject which cannot be grasped / adopted by banks due to frequent changes in the instructions and influx of certain information from time to time.

    It is, therefore, recommended that a Master Circular on each subject may be issued so that all the Instructions / modifications may be centralized and incorporated in a Master Circular in order to facilitate banks as well as all the stake holders.

    • A comprehensive consumer complaints data is available, but at present it is dispersed among individual banks, SBP and Banking Mohtasib office. SBP and Banking Mohtasib Pakistan office have published some statistics in this regard, but there is a need for a consolidated data base of all consumer complaints which would facilitate the regulator as well as banks to better identify and address recurring problems and areas of weak controls. It is recommended that a data on all consumer complaints be made for effective analysis.

    • Section 82 B (4) (b) of Part IV A of the Banking Companies Ordinance, 1962, confers the power and responsibility to the Banking Mohtasib to facilitate an amicable resolution of complaints after hearings. However, this is rendered impossible for the reason that the managers or officers of banks appearing at the hearing have no such authority from their institutions to negotiate and arrive at an amicable settlement and they tend to refer the simple issues to their Head Offices which not only delays the process of speedy justice, but also leads to a series of further communications.

    Further, Banking Mohtasib Pakistan has noticed many instances where banks agree to make payment to complainants, but the process of their internal approval is largely found to be time consuming which defeats the very basic purpose of providing speedy justice.

    The banks are thus required to make their complaint resolution mechanism compatible to relevant law to ensure prompt payment to the customer in case of complaints attaining finality under law or resolved by process of amicable settlement.

    • Reducing of notice period of complaint from customers from 45 to 15 days as it appears to be a long period which deprives the Complainant from early resolution of their complaint.

    • As per Section 82 D (1) of Banking Companies Ordinance, 1962, the Complainant is required to file his Complaint on Oath. However, It is suggested that amendment may be made in the relevant section and Complainant may be allowed to submit an undertaking instead of an attestation by the Oath Commissioner.

  • Market witnesses bullish trend on expectation of positive FATF decision

    Market witnesses bullish trend on expectation of positive FATF decision

    KARACHI: The stock market gained 603 points on Thursday owing to positive sentiments prevailed over status of Pakistan in FATF grey list.

    The benchmark KSE-100 index of Pakistan Stock Exchange (PSX) closed at 45,965 points as against previous day’s closing of 45,362 points showing an increase of 603 points.

    Analysts at Arif Habib Limited said that the market took the cue from UBL’s financial results (with a declaration of Rs. 9.5/share dividend), which were announced in the pre-open session and added a total of 642 points during the session.

    Besides, anticipation of FATF’s decision on Pakistan status on grey list helped the index move up.

    Sentiment remained buoyed throughout the session and price gains were observed across the board. Among scrips, TELE led the table with 35.8 million shares, followed by BYCO (34.5 million) and UNITY (33 million).

    Sectors contributing to the performance include Banks (+160 points), Cement (+145 points), Technology (+95 points), Fertilizer (+42 points) and Power (+41 points).

    Volumes declined from 557.5 million shares to 469.0 million shares (-16 percent DoD). Average traded value also dipped 12 percent to reach US$ 146.8 million as against US$ 16.6 million.

    Stocks that contributed significantly to the volumes include TELE, BYCO, UNITY, KEL and TRG, which formed 35 percent of total volumes.

    Stocks that contributed positively to the index include TRG (+96 points), LUCK (+87 points), UBL (+57 points), HBL (+50 points) and ENGRO (+27 points). Stocks that contributed negatively include MCB (-10 points), DAWH (-8 points), NML (-6 points), EFUG (-6 points) and PMPK (-5 points).

  • Mohtasib provides relief of Rs600 million in complaints against banks

    Mohtasib provides relief of Rs600 million in complaints against banks

    KARACHI: The Banking Mohtasib (Ombudsman) has provided a monetary relief of around Rs600 million in resolving over 16,000 complaints against banks during the year 2020.

    The Banking Mohtasib Pakistan, Muhammad Kamran Shehzad unveiled the annual report 2020 at a press conference on Thursday.

    According to the annual report of the office of Banking Mohtasib, during the period around 22,750 new complaints were received while 2,778 complaints were carried forward.

    Thus, making total complaints in hand were 25,528, out of which 16,123 complaints were resolved amicably through reconciliation while after formal hearings, findings/ orders were passed in 166 cases.

    Around 5,071 complaints were found incomplete and require further information or rejected being frivolous or for want of jurisdiction as the same either pertained to insurance matter or related to microfinance banks or fund managers or related to administrative matter of banks.

    Prime Minister’s Portal (Government-owned system based on Mobile Application) was introduced in the year 2019 and complaints related to Banking Sector were referred to BMP Secretariat. During the year under review, the office of Banking Mohtasib received 12,046 complaints through Prime Minister’s Portal.

    The report said that an increase of 56% was observed in the receipt of complaints during the year as compared to last year.

    Efforts were made to dispose of the complaints expeditiously. However, depending on the complexity, some complaints take longer time to resolve.

    People in Punjab province were seen more irritating with the services of the banking system. The Banking Mohtasib received the highest number of complaints i.e. 14,924 against banks located in the province.

    It followed by Sindh 4,027, Khyber Pakhtunkhwa 2,070, Balochistan 317, Azad Kashmir 228, Gilgit Baltistan 68 and overseas 1,114.

    During the year, the highest number of complaints lodged against Habib Bank Limited. A sum of 5,317 complaints were filed against the bank during the year 2020; out of which the Mohtasib secretariat received 2,654 complaints and the Prime Minister Portal received 2,663 complaints.

    The second highest number of complaints was lodged against United Bank Limited. Around 3,098 complaints were lodged against the bank during the year; out of which 1,562 complaints were filed at Banking Mohtasib and 1,536 submitted at the Prime Minister Portal.