Ayesha Mudassar

Allied Bank Limited (ABL), one of Pakistan’s prominent banks, has declared an unconsolidated profit-after-tax (PAT) of Rs 11.3 billion for the quarter ended March 31, 2023, with an impressive growth of 50% over the corresponding period of the earlier calendar, reports WealthPK. According to the bank’s quarterly report, the ABL recorded a profit before-tax (PAT) of Rs 22.2 billion for 1QCY24 versus a PBT of Rs 13.4 billion in 1QCY23. Moreover, the ABL announced an earnings per share (EPS) of Rs 9.92 for the quarter under review. Positive volumetric growth in average earning assets, improved spreads, and effective investment duration management all are the major contributors

The bank’s net markup income posted 42% growth, reaching Rs 29.1 billion for 1QCY24, compared to Rs 20.5 billion in 1QCY23. However, the non-markup income for the period stood at Rs 6.3 billion, representing a 7% year-on-year (YoY) decrease. The decline in foreign income was the key contributor to this negative variance. The ABL upgraded its digital as well as conventional products. This contributed to a 41% increase in fee and commission income, which reached Rs 3.5 billion during the 1QCY24, compared to Rs 2.5 billion in 1QCY23. Furthermore, the bank's other income increased by 810% to Rs 235 million for the quarter ended March 31, 2023, as compared to Rs 25.8 million for the quarter ended March 31, 2023. In addition, the bank managed to limit the increase in operating expenses to 14% by continuously automating processes and enforcing internal controls. Its operating expenses reached Rs 12.8 billion for the quarter ended March 31, 2023, compared to Rs 11.2 million for the corresponding period of last year.

ABL-Financial Position

The prudent investing and transactional banking have helped the asset base of Allied Bank to cross Rs 2.3 trillion as of March 31, 2024. The growth in assets was primarily driven by increases in investments. The net investment rose by 3% to Rs 1.16 trillion during the period under review.

Driven by marketing campaigns and customer acquisition drives, the deposit base of the bank increased by 10% to Rs 1.6 trillion as of March 31, 2023. Amidst challenging operating conditions, the ABL has demonstrated resilience and achieved significant growth in both its balance sheet and net profits.

Banking Sector Performance

Pakistan’s banking sector maintained its resilience against the multiple headwinds including pandemic aftershocks, high inflation, economic slowdown, and political unrest. As of March 31, 2024, the total assets of the industry increased by 1% to Rs 45,263 billion, compared to Rs 45,183 billion as of March 31, 2023. This growth was mainly driven by a 4% appreciation in investment. On the liability side, the bank’s total deposits grew by 2% to Rs 28,322 billion as of March 2024, compared to Rs 27,841 billion as of March 31, 2023.

Future Outlook

Despite the country’s challenges, the bank continues its endeavors in achieving its vision through growth, efficiency, and diversity and creating sustainable value for all stakeholders. The ABL focuses on promoting the advancement of the digital ecosystem in the financial sector.

Credit: INP-WealthPk