KARACHI: BankIslami recorded some 34 percent growth in Profit After Tax for the first quarter of this year (1Q22). BankIslami Pakistan Limited on Saturday announced its financial results for the quarter ended March 31, 2022.
Underpinned by growth in customer base, increase in income levels and improvements in cost efficiency; BankIslami’s underlying operating profit before provisioning for 1Q22 registered an increase by 95.8% i.e. increase from Rs684m recorded during 1Q21 to Rs1,339m during 1Q22.
With respect to its balance sheet, BankIslami had a robust start to the year 2022 wherein it continued its strategy to improve its deposit mix and deployment of liquidity towards profitable Shariah compliant avenues.
Consequently, Bank’s Current Account composition improved from 39.0% in Dec’21 to 40.4% in Mar’22. Likewise, the Bank diverted its asset mix towards better yielding corporate and consumer segments which was in line with increase in domestic demand. As a result, the net Islamic Financing of the Bank grew by 8.2%, whereas a decline of 23.9% was witnessed in its treasury placements.
Owing to growth in credit book and persistent recovery efforts against delinquent exposures, infection ratio reduced from 8.7% in Dec’21 to 8.1% in Mar’22 with an improved coverage ratio (including general provision) of 91.4% in Mar’22 versus 89.6% in Dec’21.
To improve overall credit risk profile, the Bank booked additional provisioning against its existing and potential delinquencies during the 1Q22. Despite recording additional provisioning, the Bank posted Profit After Tax amounted to Rs522m for the quarter ended March 31, 2022, depicting a growth of 33.9% from PAT of Rs390m posted during same period last year.
Going forward, the Bank will remain poised towards enhancing its Current Account Base; increasing its trade-based business turnover; and expanding its Corporate, SME, Auto and Agri finance book backed by its dynamic risk management capabilities. Moreover, to reinforce BankIslami’s capital structure and to fortify its asset base, the Bank has also planned further issue of an Additional Tier-1 Sukuk to the tune of Rs1 billion, subject to regulatory approvals.
Copyright Business Recorder, 2022
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