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KARACHI: Allied Bank Limited (ABL) remained cognizant of the high downside risks to the economic and operating environment and pursued its approach of consistent growth through robust risk management framework and enhancing customers experience using technological driven automation and digitization.

SBP’s tight policy measures continued increasing policy rate to 22 percent in June 2023 as compared to 13.75 percent in June 2022 with a motive to curb inflation and bring price stability to bring sustainable growth.

Resultantly, yields on Investments, Advances and Bank Placements have increased. Interest income increased by 93 percent to reach at Rs 169,131 million for the half year ended June 30, 2023 as compared to Rs 87,567 million for the corresponding half year ended June 30, 2022.

Markup expenses increased by 97 percent to reach at Rs 118,228 million for the half year ended June 30, 2023 as compared to Rs 60,052 million for the half year ended June 30, 2022. Resultantly, Net Interest Income (NIM) stood at Rs 50,902 million for the half year ended June 30, 2023 as compared to Rs 27,515 million for the corresponding half year ended June 30, 2022.

ABL’s continuous focus on investing in its digital financial avenues together with maintaining diversification of revenue streams facilitated a robust fee income growth of 29 percent to reach at Rs 5,055 million during half year ended June 30, 2023 as compared to Rs percent 3,932 million during corresponding period. Above mentioned surge is primarily on account of Card related fee, Investment banking fee and income from branch banking.

Dividend income increased by 23 percent to reach at Rs 1,634 million for the half year ended June 30, 2023 as compared to Rs 1,325 million for the corresponding half year ended June 30, 2022.

Foreign Exchange (FX) income reached at Rs 4,360 million during half year ended June 30, 2023 as compared to Rs 4,296 million during the half year ended June 30, 2022, increased by 1.5 percent. ABL earned capital gain of Rs 211 million during the half year ended June 30, 2023 as compared to Rs 1,139 million for the half year ended June 30, 2022.

Total income marked at Rs 62,210 million during the half year ended June 30, 2023 as against Rs 38,255 million for the corresponding half year ended June 30, 2022, increased by 63 percent.

Despite multiple factors of inflationary pressure and increased spending towards technological enhancement, ABL was successful to restrict administrative expenses at Rs 24,263 million during the first half of 2023 as compared to Rs 18,886 million during the first half of 2022.

The Bank posted profit before tax of Rs 35,204 million during the half year ended June 30, 2023 which is higher by 75 percent as compared to Rs 20,118 million for corresponding period last year.

ABL posted profit after tax (PAT) for the half year ended June 30, 2023 of Rs 17,443 million, higher by 153 percent as compared to the corresponding half year ended June 30, 2022. In line with profit after tax, earnings per share (EPS) of ABL also increased to Rs 15.23 as compared to Rs 6.01 against the same corresponding period.

Without comprising on the branch banking operations, the bank geared up its focus on evolving digital needs of the customers. Resultantly Branch outreach was expanded to 1,465 branches including 1,340 conventional, 118 Islamic banking branches and 07 digital branches.

Meanwhile, ABL exhibits robust ATM network of 1,565 machines including 1,309 on-site, 251 off-site and 05 Mobile Banking Units (MBU) with ATM uptime average of 95 percent during the half year ended June 30, 2023.

Total assets of the Bank recorded at Rs 2,353,684 million increased by 5 percent as on June 30, 2023 as compared to Rs 2,250,973 million as on December 31, 2022. This increase is mainly attributable to increase in cash and balances with other banks, other assets and investments by Rs 71,474 million, Rs 28,063 million and Rs 15,392 million respectively.

Net assets of the Bank stood at Rs 136,650 million as on June 30, 2023 as compared to Rs 127,811 million showing an increase of 7 percent.

Due to effective monitoring under tough operating environment, non-performing advances portfolio of ABL was restricted to Rs 13,522 million as on June 30, 2023. Gross advances and net advances reached at Rs 830,677 million and Rs 817,355 million respectively. ABL continued its momentum towards low infection ratio and high overall coverage ratio which stood at 1.63 percent and 98.52 percent respectively.

Deposit base of the Bank, with the growth of 9 percent stood at Rs 1,665,118 million as on June 30, 2023 as compared to Rs 1,522,297 million as on December 31, 2022. ABL’s current account base increased to Rs 727,549 million during the first half of the 2023, hence Current deposits to total deposits ratio stood at 43.7 percent as on June 30, 2023 as compared to 40 percent as on December 31, 2022. Also, current account and saving account mix to total deposits (CASA) improved to 81.3 percent as on June 30, 2023 compared to 78.9 percent as on December 31, 2022.

Effective funds deployment in investments resulted in increase in investment portfolio by Rs 15,392 million to reach at Rs 1,138,509 million as on June 30, 2023 showing an increase of 1 percent as compared to Rs 1,123,117 million as on December 31, 2022. This escalation is attributable to liquidity placement in Government securities.

ABL’s equity base stood at Rs 136,650 million as at June 30, 2023 as compared to Rs 127,811 million as at December 31, 2022. Return on Assets (ROA) and Return on Equity (ROE) stood at a robust level of 1.5 percent and 27.1 percent respectively. Capital Adequacy ratio (CAR) of the Bank stood at 19.76 percent against statutory requirement of 11.5 percent which is indicative of strong capital footing of ABL.

Copyright Business Recorder, 2023

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