National Bank of Pakistan (NBP) will announce on Monday its financial results for the first quarter ended March 31, where net earnings may range between Rs 1.89 billion and Rs 2.1 billion, analysts said. "We expect the bank to report net earnings in the range of Rs 1.89 billion to Rs 2.01 billion (diluted EPS: Rs 3.2 -3.4) as against Rs 971 million (diluted EPS: 1.97) posted during the same period of last year", said Faisal Shaji, research analyst at Capital One Equities.
The escalation in earnings is mainly in the wake of growth in advances, better yield on earning assets and an upsurge in non-core income due to capital gain galore from equities. "We expect 52 percent increase in bank's advances to the extent of Rs 255 billion from last quarter which, coupled with consistent 4.9 percent yield on core earning assets, is expected to contribute to the core income of the bank," he said.
Muhammad Imran, research analyst from Jahangir Siddiqui Capital, said that NBP might announce after-tax profit of Rs 1.9 billion to Rs 2.0 billion, a growth of 98-108 percent from Rs 971 million in the corresponding quarter of 2004. "We are not expecting any pay-out to be announced with upcoming results."
Major contribution to profitability growth will be made by net interest income of the bank, which is expected to grow by 13 percent, to Rs 3.4 billion, as compared to Rs 3.0 billion in the corresponding quarter of last year. Other revenue generator for the bank would be its fee commission and brokerage income, which is likely to soar by 61 percent to Rs 1.8 billion as compared to Rs 700 million previously. NBP holds equity portfolio of Rs 3.6 billion besides 13.7 billion worth NIT units as on December 31, 2004. "In 1Q2005, we are also expecting capital gains of Rs 280-320 million."
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