Habib Bank Limited (HBL), one of the country’s largest banks, said that it intends to establish a subsidiary to promote Pakistan’s agriculture sector.
The development was shared by HBL in its notice to the Pakistan Stock Exchange (PSX) on Wednesday.
“We would like to clarify that the bank (HBL) intends to set up a subsidiary, to promote the agriculture sector of Pakistan, for which a detailed feasibility report has been finalised,” read the notice.
HBL said that it is currently in the process of obtaining all regulatory approvals required for the incorporation of the said subsidiary.
HBL declared earnings in January-March with a profit before tax (PBT) of Rs21.5 billion, 47% higher than the PBT of Rs14.6 billion last year.
The bank’s profit after tax rose by 54% to Rs 13.3 billion with earnings per share improving from Rs 5.78 in Q1’22 to Rs 9.00 in Q1’23.
Meanwhile, the agriculture sector, which is widely considered the backbone of Pakistan’s economy, saw a 27.5% growth in agri loans, after the agriculture lending financial institutions disbursed Rs 1.222 trillion on account of agricultural financing during the first nine months (July-March) of this fiscal year.
According to the Economic Survey of Pakistan released last month, the State Bank of Pakistan (SBP) allocated the indicative agricultural credit disbursement target of Rs1.819 trillion for FY23, which is 28.2 percent higher than last year’s disbursement of Rs 1.419 trillion.
Further, the outstanding portfolio of agricultural loans has increased by Rs80.2 billion and reached Rs712.9 billion at the end of March 2023 compared to Rs632.7 billion at the end March 2022, witnessing 12.7% growth.
Analysis of the sector-wise disbursement reveals that out of the total disbursement of Rs 1.222 trillion, the farm sector has received Rs 625.1 billion (51.2%) and Rs 596.8 billion (49%) has been disbursed to non-farm sector during July March FY2023.
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