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HBL’S profit before tax takes 3pc jump in Sept-2019

During the period nine months ended September 30, 2019 (9M’19), the financial experts of Habib Bank Limited (HBL) have recorded that the profit before tax (PBT) was at Rs 18.3 billion, 3 percent higher than for the corresponding period previous year. This is despite the significant impact of the falling Rupee and the equity market, which have together reduced pre-tax profit by Rs 7.4 billion. The experts in HBL also calculated in the report of the bank that the profit after tax (PAT) of Rs 8.8 billion for 9M’19 is, however, Rs 1.1 billion lower than previous year, because of the retrospective imposition of Rs 1.9 billion of Super Tax on 2017 earnings. HBL’s earnings per share (EPS) for 9M’19 are at Rs 5.89. The Bank’s core domestic business is remained on an optimistic growth trajectory with market shares of loans and deposits both are increasing over the last quarter.

HBL, Pakistan’s largest bank, was the first commercial bank to be established in Pakistan and is a leading full-service commercial bank. The key areas of operation are Branch Banking, Corporate & Investment Banking, Treasury, SME & Rural Banking, Financial Institutions & Global Trade Services, Transaction Banking and Islamic Banking.


The Branch Banking business is the mainstay of the Bank, positioning HBL as the largest retail bank in Pakistan catering to all market segments. HBL Corporate & Investment Banking Group is a leading provider of financial services to multinational and local corporate clients across the country. The Bank also has the largest Treasury operations in Pakistan and plays a key role in Pakistan’s domestic markets.

It is also calculated that during the year, total domestic deposits grew by Rs 118 billion, to Rs 2.0 trillion. With almost all deposit growth coming from current and savings accounts, the CASA mix enhanced from 85.4 percent in December 2018 to 85.9 percent in September 2019. Broad based growth also resulted in domestic advances growing to Rs 954 billion. International business deposits grew by 12 percent over December 2018, with loans rising by nearly 30 percent. HBL’s total deposits thus grew by 7.0 percent to Rs 2.3 trillion and total advances increased by 8.1 percent, to Rs 1.2 trillion. A growth of Rs 87 billion in average domestic deposits resulted in a 7percent growth in the domestic balance sheet. With most of this coming from current accounts, the increase in the cost of deposits was contained. Yields on earning assets grew because of re-pricing of loans and rollover of maturing investments at higher rates. The Domestic net interest margin was enhanced by 75 bps with net interest income up by 22 percent. With strengthening overseas balance sheets adding to the domestic growth, total net interest income grew by 23 percent, to Rs 74.1 billion.

The financial experts of the bank also recorded that fee income remained robust, increasing 21 percent, with the domestic business growing by 20 percent. The growth was across all business lines with the card and consumer finance businesses, investment banking and trade delivering a particularly strong performance. While the foreign exchange market has seen increased volatility, the Bank’s Treasury has capitalized on this trend via careful positioning of the book and by capturing a larger share of Corporate and Commercial customer volumes. As a result, core foreign exchange income for 9M’19 grew by 44 percent over 9M’18. Total non-fund income grew by 13 percent over 9M’18 to Rs 22.8 billion. The Ongoing remediation, legal and regulatory costs related to the Bank’s New York branch continue to weigh on the Bank’s expenses which grew to Rs 69 billion.


The Impact of rupee devaluation on international expenses, the incremental cost of HBL Tower, expenses related to new domestic regulations and the cost of growing financial access to the unbanked – a result of growth in acquisition volumes – also contributed to the rise. Despite a strong recovery pipeline, credit stresses are being witnessed across customer segments with credit provisions growing by Rs 1.4 billion over the prior year, to Rs 1.2 billion.

HBL is shaping the future through a paradigm shift as a ‘Technology company with a banking license’. The Bank’s multiple digital channels are helping it get closer to its customers through innovative and frictionless ways. As the leading financial intuition of Pakistan, HBL is at the forefront of all development initiatives which includes growth of priority sectors and targeting the unbanked population in Pakistan.

The Bank remains committed to its objective of financial inclusion for all sectors of society, across Pakistan. The Bank is already playing a leading role in enhancing gender diversity through ensuring the access of women to the financial sector. During the quarter, HBL forged partnerships and launched digital innovations to improve customer lifestyle experiences, reinforcing its position as Pakistan’s leading bank. Through its partnership with Alkaram Studio, HBL Konnect will integrate its digital solutions for Alkaram Studio shoppers, both online and at physical storefronts.

The Bank’s management also inked a landmark agreement with Ufone, extending the first bilateral RMB Trade Finance facility. HBL was nominated as BISP’s exclusive funds disbursement partner in Punjab, Sindh and Balochistan and will be dispersing an aggregate of Rs 120 billion to 6 million women yearly.

The Management of HBL continues to receive multiple international awards. Asiamoney awarded HBL as the Best Local Bank in the Region for Belt & Road Initiative (BRI), Best Individual BRI Project/Initiative in the Region, and Best Corporate Finance House – Fixed Income. HBL’s focus on gender diversity and inclusion was recognized by the Asian Development Bank who awarded HBL the prestigious Gender Champion Award. For the fourth year running, HBL received the Brand of the Year, Banking – Pakistan, at the World Branding Awards.

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