Karachi, August 7, 2024 – MCB Bank has announced a record-breaking profit before tax (PBT) for the first half of 2024, reaching Rs 62.7 billion, a 16% increase from the previous year.
Profit after tax (PAT) also saw a significant rise, growing by 20% to Rs 31.9 billion, which translates to an earnings per share (EPS) of Rs 26.95, up from Rs 22.52 in the same period last year.
The Board of Directors of MCB Bank Limited, chaired by Mian Mohammad Mansha, reviewed the bank’s performance and approved the condensed interim financial statements for the half-year ending June 30, 2024. The board declared a second interim cash dividend of Rs 9.0 per share (90%), bringing the total cash dividend for the first half of 2024 to 180%.
Strong Financial Performance
MCB Bank’s net interest income for the first half of 2024 increased by 12% compared to the same period last year. This growth was driven by strong volumetric growth in average current deposits and strategic repositioning within the asset book.
Non-markup income surged to Rs 18.3 billion, a 30% increase from Rs 14.1 billion in the corresponding period last year. This rise was primarily due to a 29% increase in fee commission income (Rs 11.3 billion), a 38% rise in foreign exchange income (Rs 4.9 billion), and a 13% increase in dividend income (Rs 1.7 billion).
Operational Efficiency and Cost Management
Despite the high inflationary environment and continued investments in human resources and technology, the bank managed its operating expenses efficiently, which stood at Rs 28.4 billion, an 18% increase. This rise was mainly due to staff costs (+15%), utility costs (+28%), and IT-related expenses (+22%). The cost-to-income ratio was 30.50%, compared to 29.58% in the same period last year.
Asset Quality and Risk Management
MCB Bank maintained a robust credit risk management framework, reporting non-performing loans (NPLs) at Rs 57.0 billion as of June 30, 2024. The bank’s coverage and infection ratios were 89.07% and 8.64%, respectively.
Financial Position and Capital Adequacy
The total asset base of the bank increased by 10.1% over December 2023, reaching Rs 2.67 trillion. This growth was supported by a 19% increase in investments and a 6% rise in gross advances. The bank’s deposit base grew by Rs 110 billion (+13%), with the total deposits standing at Rs 1.99 trillion. Despite a rise in the domestic cost of deposits to 10.76%, the bank maintained a strong return on assets (2.50%) and return on equity (30.08%).
Capital Strength and Liquidity
MCB Bank’s total Capital Adequacy Ratio (CAR) improved to 20.68%, well above the regulatory requirement of 11.5%. The bank’s Common Equity Tier-1 (CET1) ratio was 17.09%, and the leverage ratio stood at 6.2%, both exceeding regulatory limits. The Liquidity Coverage Ratio (LCR) was 261.91%, and the Net Stable Funding Ratio (NSFR) was 164.85%.
Market Position and Credit Rating
The Pakistan Credit Rating Agency reaffirmed MCB Bank’s long-term and short-term credit ratings at “AAA / A1+” on June 22, 2024. The bank operates the second-largest network of over 1,650 branches in Pakistan and remains a leading stock in the Pakistani equity market.
MCB Bank continues to strengthen its position with strategic growth, efficient cost management, and robust risk management practices, ensuring its status as one of the highest capitalized banks in the industry.
