HBL’s total regulatory penalties rise 60% as bank reports Rs34.5bn profit after tax and deposits reach Rs5.9tr.
KARACHI: The State Bank of Pakistan (SBP) imposed penalties of Rs172.38 million on Habib Bank Limited (HBL) during the first half of calendar year 2026, marking a significant increase from the previous year.
According to HBL’s financial results, the bank paid Rs172.38 million in penalties imposed by the SBP during January-June 2026, compared with around Rs100 million during the corresponding period of 2025.
Penalties imposed by other regulatory bodies, meanwhile, declined during the period. HBL paid Rs7.05 million to other regulators in H1CY26, down from Rs12.03 million in the same period last year.
As a result, HBL’s total regulatory penalties increased to Rs179.43 million during the first half of 2026, compared with approximately Rs112 million in H1CY25.
HBL posts Rs34.5bn profit after tax
Despite the higher regulatory penalties, HBL reported consolidated profit before tax of Rs73.1 billion for H1CY26, compared with Rs75.3 billion in the same period last year.
The bank’s profit after tax increased to Rs34.5 billion, supported partly by a one-percentage-point reduction in the applicable tax rate. Earnings per share improved to Rs23.51 from Rs23.44 in H1CY25.
HBL said its revenue remained robust despite continued pressure from spread compression, supported by the strength of its domestic franchise and sustained business momentum.
The bank’s balance sheet expanded by 4% from December 2025 to Rs8.0 trillion by June 2026.
Domestic deposits reached a record Rs5.1 trillion, driven entirely by current account deposits, which crossed the Rs2 trillion mark. This lifted the domestic current account mix from 37.6% in December 2025 to 42.5% in June 2026.
Total deposits reached Rs5.9 trillion, while HBL’s loan book expanded to Rs2.1 trillion.
Consumer, agriculture and SME lending expands
HBL’s consumer banking business continued its growth trajectory, with lending rising to Rs187 billion.
The bank’s agriculture portfolio stood at Rs110 billion, which it described as the largest in the industry, while its SME lending book reached Rs170 billion.
Despite pressure on spreads, HBL’s net interest income increased to Rs140 billion during H1CY26. The bank said average balance-sheet volumes expanded by around Rs700 billion, with current accounts accounting for most of the growth.
The improved funding mix helped reduce the cost of deposits compared with the previous year and partially offset margin compression.
Non-funded income increased 5% to Rs47 billion, primarily supported by higher fees and strong treasury performance. Fees and commissions rose 16% to Rs26 billion, helped by continued momentum in the cards business as well as contributions from remittances and government-to-person (G2P) income.
Consequently, HBL’s total revenue increased to Rs187 billion during the first half of 2026.
The bank also maintained its focus on cost efficiency, restricting growth in administrative expenses to 6%.
Improved recoveries during the quarter helped reduce domestic non-performing loans and contain the infection ratio, while total provision coverage remained above 100%.
The financial results show that HBL maintained strong business and balance-sheet growth during H1CY26 despite continued margin pressures. However, the sharp increase in SBP-imposed penalties added significantly to the bank’s regulatory costs during the period.