The Board of Directors of Meezan Bank Limited in its meeting held on October 14, 2021 approved the unaudited unconsolidated condensed interim financial statements of the Bank consolidated financial statements for the nine months period ended September 30, 2021. The meeting was presided by Mr. Riyadh S.A. A. Edrees – Chairman of the Board and Mr. Faisal A. A. A. Al – Nassar – Vice Chairman of the Board was also present.
The Bank recorded excellent results for the nine months period ended September 30, 2021 with Profit After Tax of Rs 19.6 billion as compared to Rs 18.1 billion in the corresponding period last year reflecting a growth of 8%. The EPS of the Bank increased to Rs 12.03 per share from Rs 11.11 per share in September 2020 – on enhanced share capital of Rs 16.3 billion. The Board has approved third interim cash dividend of Rs 1.50 per share (15%) bringing the total dividend payout for the nine months to Rs 4.50 (45%) per share as Rs 3.00 per share (30%) interim cash dividend was already paid for the half year. This is in addition to 15% bonus shares issued during the last quarter.
Despite a 27% decline in underlying average Policy Rate which reduced from an average of 9.6% in corresponding period last year to 7%,the Bank’s net spread dropped by 2% only, to Rs 48.5 billion from Rs 49.7 billion in the corresponding period last year due to substantial growth in the Bank’s earning assets and average current account deposits. The Bank’s non-funded income recorded a 43% growth closing at Rs 10.3 billion mainly contributed by increase in fee and commission income and foreign exchange income which rose by 70% and 34% respectively. Trade finance related income, branch banking income and debit card related fee income remained the key contributories to higher fee and commission income of the Bank. The Bank’s operating and other expenses also increased by 13% to Rs 25.6 billion due to continuous branch expansion – an investment in future. During the nine months, the Bank has opened 34 new branches taking the total network size to 849 branches in 265 cities (December 2020: 815 Branches in 248 cities).
Deposits of the Bank closed at Rs 1.34 trillion – 7% up from last year. The CASA ratio of the Bank improved to 81% on September 30, 2021 as compared to 76% on December 31, 2020 with current account deposits of Rs 581 billion on September 30, 2021. Current account deposits now comprise 43% of the total deposits.
The Bank’s total assets grew by 12% to Rs 1.7 trillion in September 2021 from Rs 1.5 trillion in December 2020. Gross Financings portfolio of the Bank grew by 17% to Rs 623 billion from Rs 532 billion in December 2020 with Gross Advances to Deposits Ratio (ADR) of 46% as compared to 42% in December 2020. The Bank maintains a comfortable level of provisions against its non-performing financings with a coverage ratio of 131% while its non-performing financing ratio stood at 2.3%. The Bank’s investment portfolio rose by 10% to Rs 476 billion from Rs 434 billion last year, out of which 95% represents investment in Federal Government / Government Guaranteed Securities.
The Bank is all set to launch its Merchant Acquiring initiative and e-Commerce Payment Gateway to rapidly grow digital payments in Pakistan and fulfill the needs of a vast majority of retailers and online businesses who have been looking for a Shariah-compliant payment solution. The Bank’s Mobile Banking App has been consistently ranked as No.1 Mobile Banking App in Pakistan by both Apple Store and Google Play Store. The VIS Credit Rating Company Limited (VIS) has upgraded the Bank’s credit rating to ‘AAA / A-1+’ – the highest possible level which indicates highest possible credit quality, with negligible risk factors, being only slightly more than for risk-free debt of Government of Pakistan (GoP).