ABL reports strong growth in assets, profitability

KARACHI: Allied Bank has made impressive progress in expanding its market presence, reflecting strong growth in both assets and profitability. With a focus on innovation and customer-centric solutions, the Bank has successfully navigated challenging market conditions strengthening its position in the industry.

The Bank’s markup or interest income rose to Rs 376,760 million for the year ended December 31, 2024, compared to Rs 357,307 million for the year 2023, reflecting a 5% increase. This growth was fueled by an increase in average earning assets, and effective management of investment durations and spreads. On account of higher cost of deposits and interest expense on right of use of assets partially offset by lower borrowing expense, markup or interest expenses of ABL increased by Rs 17,509 million or 7% to reach at Rs 261,537 million for the year ended December 31, 2024 as compared to Rs 244,028 million for the corresponding year. The Bank declared Rs 16.00 dividend for the year ended December 31, 2024.

Fee income stood at Rs 14,081 million for the year ended December 31, 2024 as compared to Rs 10,641 million for the corresponding year and has increased by Rs 3,440 million or 32%, mainly on account of higher card related fee, commission on remittances fee, Branch banking customer fee, acquiring business and commission on trade.

Dividend income of the Bank stood at Rs 3,018 million for the year ended December 31, 2024 as compared to Rs 3,543 million for the year ended December 31, 2023, lower by 15%.

Capital gain of ABL for the year under review was Rs. 3,444 million or 308% mainly due to higher gain on sale of Federal government securities and Euro bonds compared to Rs 845 million for the year ended December 31, 2023.

Foreign Exchange income of the Bank stood at Rs 6,679 million for the year ended December 31, 2024, against Rs 9,167 million for last year, lower by 27%.

Non-markup or non-interest income of Allied Bank stood at Rs 27,980 million for the year ended December 31, 2024, reflecting a 15% growth from Rs 24,427 million in the corresponding year.

The Bank’s other income amounted to Rs 758 million in 2024, compared to Rs 231 million in 2023, marking a 228% increase.

Allied Bank’s focus on expanding its branch network and enhancing technological capabilities resulted in increase in total operating expenses. However, through use of technology and process automation and improvements, the Bank managed to restrict the increase in operating expenses to 20%. Total operating expenses reached at Rs 57,985 million for the year ended December 31, 2024, compared to Rs 48,972 million for the year ended December 31, 2023.

For the year under review, profit before taxation for the year ended December 31, 2024 stood at Rs 87,928 million, reflecting a 3% increase from Rs 85,757 million in the corresponding year ended December 31, 2023. This growth was primarily driven by higher net markup and non-markup income and credit loss reversals partially offset by higher operating expenses.

The effective income tax rate for the year ended December 31, 2024 was 50.96% compared to 52.56% for the previous year. The tax charge for 2024 stood at Rs 44,812 million, slightly lower than Rs 45,074 million in 2023, reflecting a 1% decrease. Through the income tax (Amendment) Ordinance, 2024, the Federal Government increased the normal tax rate for banks from 39% to 44% for the year under review and removed higher tax rates on income attributable to investments in Federal Government Securities (FGS), based on banks’ Advances to Deposits Ratio (ADR) for the year 2024 onwards.

ABL’s profit after tax stood at Rs 43,116 million for the year ended December 31, 2024, up from Rs 40,683 million in the corresponding year of 2023, registering a growth of 6%.

The Bank achieved a millstone by surpassing the Rs 2 trillion deposits base. Total Deposits at the year-end stood at Rs 2,018,395 million, as compared to Rs 1,676,623 million as December 31, 2023, reflecting a growth of 20.4%. Additionally, the market share of deposits increased to 6.67% as of December 31, 2024, up from in the previous year. The Bank’s continued focus on enhancing low cost or no cost deposits resulted in a 9% growth in current accounts, despite high saving rates.

Gross advances of Allied Bank recorded at Rs 1,066,348 million as on December 31, 2024, compared to Rs 794,138 million as on December 31, 2023, making a robust growth of 34%. Net advances of ABL reached at Rs 1,051,314 million as on December 31, 2024, compared to Rs 781,597 million as on December 31, 2023, expanding by 35%.

Allied Bank continues to maintain a consistently low infection ratio, demonstrating the high quality and reliability of its credit portfolio. As of December 31, 2024 the Bank’s infection ratio stood at 1.22% improving from 1.64% in the previous year. The specific and overall coverage ratios were recorded at 93.85% and 115.71% respectively, compared to 94.61% and 96.18% as of December 31, 2023.

Allied Bank’s total investments stood at Rs 1,129,874 million as of December 31, 2024 compared to Rs 1,150,318 million for the year previous year, showing a slight decline of 2%.

ABL’s total assets recorded at Rs 2,816,969 million as of December 31, 2024 reflecting a robust growth of 21% from Rs 2,329,317 million in the previous year. The Bank’s net assets increased by 20%, reaching Rs 233,901 million as of December 31, 2024, compared to Rs 194,254 million in 2023.

The Return on Assets (ROA) and Return on Equity (ROE) Teir 1 of the Bank recorded at 1.7% and 26.0% respectively as on December 31, 2024, compared to 1.8% and 29.4% in the previous year.

The Capital Adequacy Ratio (CAR) of the Bank stood at 26.71% as of December 31, 2024, up from 26.21% in 2023, remaining well above the minimum regularity threshold of 11.5%

Allied Bank’s extensive nationwide branch network, which provides a strategic advantage, has been further strengthened through the addition of digital and smart branches, along with the renovation of existing locations to enhance the overall customer experience. The Bank now operates a total of 1,510 branches, including 1,332 conventional branches, 160 Islamic branches, and 18 digital branches, catering to a diverse range of customer needs.

Allied Bank is well-positioned to provide uninterrupted banking services across the country, through a diverse range of channels, including its extensive branch network, ATMs, online and mobile banking platforms and other digital touchpoints ensuring convenience and accessibility for customers at all times. Allied Bank’s accessibility is further enhanced by a robust network of 1,604 Automated Teller Machines (ATMs) comprising 1,356 onsite ATMs, 243 off-site ATMs, and 5 Mobile Banking Units (MBUs).

As the Bank moves forward, it remains strategically focused on delivering innovative digital solutions to meet the evolving demands of its diverse customer segments, while simultaneously driving long-term value creation for its stakeholders through a combination of operational agility, financial resilience, and a strong emphasis on robust corporate governance, risk management, and sustainable business practices.

Copyright Business Recorder, 2025