Habib Bank Limited’s net earnings declined by almost a tenth to Rs 9 billion in the January-March quarter of 2016, according to a notice sent to Pakistan Stock Exchange on Friday.
HBL made an after-tax profit of Rs 9.03 billion or Rs 6.15 per share in the first quarter of 2016, 9.06% lower than Rs 9.93 billion or Rs 6.77 per share it made over the same period of the previous year.
The bank also announced an interim cash dividend of Rs 3.50 per share.
The share price of Pakistan’s largest private bank decreased by Re 0.30 to close at Rs 174.17, down 0.17% from the last day’s closing price of Rs 174.47 per share. More than 2 million shares changed hands during the day.
The first commercial bank to be established in Pakistan, HBL reported a net mark up income of Rs 20.1 billion during the first quarter of the year.
Net interest income rose by 5% year-over-year to Rs 20.2 billion because of a 12% decline in interest expenses and a marginal dip the interest income, which was down 3%, says Taurus Securities. It further said the non-markup income of the bank nose-dived to Rs 6.5 billion, down 16% from Rs 7.7 billion mainly due to lower capital gains (Rs 364 million in this quarter compared to Rs 2.2 billion during the same quarter of last year.)
According to Topline Securities, key risks for HBL are: deterioration in Pakistan macros, soft credit growth numbers and further cut in interest rates.