Karachi, February 6, 2024 – MCB Bank, one of Pakistan’s leading financial institutions, has announced its highest-ever profit and dividends for the calendar year 2023, according to analysts at Arif Habib Limited.
The bank reported a profit after tax (PAT) of Rs 16.9 billion for the fourth quarter of CY23, reflecting an impressive 23% year-on-year (YoY) increase. However, there was a 14% quarter-on-quarter (QoQ) decrease, with the fourth quarter of CY22 having an earnings per share (EPS) of PKR 11.61 compared to PKR 14.24 in the recent quarter.
The notable surge in overall earnings can be attributed to the growth in total income. In conjunction with the financial results, MCB Bank declared a final dividend of PKR 9 per share, bringing the total dividends for CY23 to PKR 30 per share.
The bank’s net interest income (NII) for the fourth quarter of CY23 reached PKR 46.3 billion, marking a substantial 61% YoY increase and a 3% QoQ uptick. The total NII for CY23 amounted to PKR 165.4 billion, showcasing an impressive 72% YoY growth. This surge was fueled by a 66% increase in interest earned during CY23, while interest expenses rose by 61%.
The non-funded income (NFI) witnessed a remarkable 126% YoY increase and an 18% QoQ increase in the fourth quarter of CY23, contributing to a total of PKR 35.4 billion for CY23, representing a notable 37% YoY rise. This surge in NFI during CY23 was primarily driven by higher fee and commission income, which soared by 44% YoY, reaching PKR 22.4 billion. Additionally, dividend income increased by 18% in CY23, totaling PKR 2.5 billion. MCB also recorded gains on securities amounting to PKR 837 million, in contrast to a loss recorded in the same period last year of PKR 1.7 billion.
MCB Bank recorded provisioning reversals of PKR 721 million during the fourth quarter of CY23, marking a 46% YoY decline. This brought the total provisioning for CY23 to PKR 1.08 billion, compared to provisioning reversals of PKR 2.6 billion in CY22.
Operating expenses (OPEX) increased by 31% YoY in the fourth quarter of CY23, totaling PKR 17.7 billion, resulting in a cost/income ratio of 30.9%, a significant improvement from the same period last year’s 40.2%.
The effective tax rate was set at 58% during the fourth quarter of CY23, compared to 36% in the same period last year (SPLY), with the effective tax rate for CY23 standing at 53%, slightly lower than the 54% recorded in CY22.
MCB Bank’s robust financial performance in CY23 underscores its resilience and strategic management in navigating economic challenges, positioning it as a key player in Pakistan’s banking sector.
