Ayesha Mudassar

MCB Bank Limited, one of Pakistan's largest private-sector banks, reported a 10% year-on-year (YoY) increase in its profit-after-tax, which reached Rs48.4 billion in the nine months ended September 30, 2024.

According to the results available with the Pakistan Stock Exchange, the bank’s profit-before-tax grew by 8% to Rs95.1 billion, translating into earnings per share of Rs40.88 compared to Rs37.25 reported in the same period last year. This growth was driven by a long-term strategy and effective management, particularly in no-cost deposits and economic capital optimisation.

Additionally, the net markup income saw an 8% increase, driven by strong volumetric growth in average current deposits and the strategic repositioning of the asset portfolio. The company’s non-markup income rose to Rs26.8 billion compared to Rs22.5 billion in the previous year, with significant contributions from fee and commission income (Rs2.1 billion), foreign currency trading gains (Rs1.5 billion), and dividend income (Rs424 million). Furthermore, MCB’s total asset base grew by 15%, reaching Rs2.7 trillion as of September 2024.

A detailed analysis of the asset composition reveals a 21% increase in net investments compared to the corresponding period of the last calendar year. MCB is one of the pioneers of Pakistan's banking sector. The bank achieved a significant milestone by becoming the first Pakistani bank to list its global deposit receipts (GDRs) on the London Stock Exchange in 2006. Additionally, it holds the distinction of being the first bank in Pakistan to establish a wholly-owned Islamic subsidiary.

Performance in 2023

MCB demonstrated exceptional financial performance in 2023, driven by a significant increase in total income. The bank’s net markup income surged to Rs147.7 billion from Rs87.1 billion in the previous year. Additionally, the non-markup income rose to Rs32.9 billion against Rs24.6 billion in 2022. The bank reported its highest-ever yearly profit of Rs59.6 billion in 2023, with an 82% increase from Rs32.7 billion recorded in 2022. The bank’s earnings per share stood at Rs50.32 compared to Rs27.63 in 2022. The year 2023 presented significant challenges, including geopolitical tensions, economic uncertainties, and climate-related concerns.

Despite these headwinds, MCB remained steadfast in its commitment to maintaining financial stability and providing reliable banking services and support to its valued customers. Amidst challenges, the year also presented exciting opportunities for innovation and growth. The rapid advancement of digital technologies, including artificial intelligence, has transformed the global banking landscape. Pakistan's banking sector is actively embracing digital transformation, creating vast opportunities to enhance customer service and deliver improved solutions.

Future outlook

MCB is dedicated to actively supporting the country’s economic development through strengthening financial inclusion and providing banking services across the country. Moreover, the bank aims to focus on no-cost deposits to optimise earnings potential, while aggressively investing in technological transformation to become more agile and efficient organisation.

Credit: INP-WealthPk