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Meezan Bank’s Q1 profit and tax surges to 97pc

The economic experts of Pakistan stated that Pakistani economy presently faces challenges similar to other developing countries in the world. The economy, stock market and rupee were getting stronger before coronavirus and as soon as Pakistan overcomes this pandemic, the country s economy will bounce back.

Despite the present situation of Pakistan, Meezan Bank continued to perform well during the first quarter ended March 31, 2020 and registered profit after tax of Rs 5,505 million from Rs 2,800 million in same period last year – a growth of 97 percent. Meezan Bank is Pakistan’s best bank and the first and largest Islamic bank as well as the fastest growing financial institutions in the banking sector of Pakistan. Meezan Bank provides a wide range of Islamic banking products and services by a retail banking network in Pakistan. The Management of Meezan Bank operates strictly under the rules of Islamic Shariah and is well recognized for its product development capability, Islamic banking research and advisory services. In order to ensure strict Shariah-compliance in all its products and services, the management has organized a dedicated product development and Shariah compliance department that operates under the supervision of the Bank’s in-house resident Shariah board member as a Shariah supervisory board comprising of internationally renowned Shariah scholars.

In the financial report of the Bank, the experts showed that the earnings per share – on improved capital grew to Rs 4.28 per share from Rs 2.18 per share in March 2019. Meezan Bank’s non-funded income grew to Rs 3.2 billion from Rs 1.9 billion in the same period previous year — a growth of 64 percent mainly because of higher foreign exchange income and gain on sale of securities of Rs 680 million. The financial experts of the bank also registered that the bank’s operating and other expenses grew to Rs 7,111 million from Rs 5,451 million in same period last year mainly because of rise in cost associated with opening of 98 new branches from March 2019 – an investment in future. However, this rise in expenses is adequately absorbed through the growth in the bank’s funded and non-funded income resulting in improvement in income efficiency ratio.

 

Statistics showed in the Bank’s report that Meezan Bank’s income efficiency ratio now stands at 40 percent as against to 51 percent in March 2019. The Management of the Bank has approved an additional general provision of Rs 1 billion against any potential non-performing financings and stress on the borrowers in view of economic issues arising because of COVID -19 pandemic. Meezan Bank financial experts also recorded, sustains a comfortable level of provisions against its non-performing financings with a coverage ratio of 147 percent — one of the highest in the banking industry. The financial report of Meezan Bank also recorded that the total assets of the bank reached slightly higher at Rs 1,138 billion as against Rs 1,121 billion in December 2019. The Bank’s financing declined slightly from Rs 494 billion in December 2019 largely because of repayment of seasonal financing and overall slowdown in economic activity. Furthermore, the Meezan Bank’s financing portfolio is well diversified among top notch Corporate, Commercial, mid-tier Small and Medium Enterprise (SME) and Consumer segments. The focus remains to build a high quality and diversified financing portfolio.

Statistics in the report also showed that Meezan Bank was able sustain its deposits at Rs 928 billion as against to Rs 933 billion in December 2019. The Bank’s average current account deposits were increased by 18 percent from same period last year which also contributed to higher net spread. Meezan Bank remains fully committed to supporting their communities in assisting them cope with this malaise. Be rest assured that the management is taking every possible initiative to safeguard the health of their approximately 12,000 strong staff and at the same time, as an ‘essential service’, ensure that the management is able to service all customers with their banking needs without any interruption. For this purpose, the management has activated its business continuity plans for which the bank had earlier invested heavily both in infrastructure, technology and training. This investment has paid off, and the management has fruitfully deployed about 70 percent staff to work from alternate sites, or from the safety of their homes, so as to minimize the risk of exposure to the disease and also to ensure social distancing.

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