The National Bank of Pakistan (NBP) has reported a total income of PKR 96.8 billion for the first half of 2024. This marks a 5.1% increase from the PKR 92.2 billion recorded in the same period last year. The bank’s performance was particularly strong in the second quarter of 2024, with income reaching PKR 54.4 billion, up from PKR 42.5 billion in the first quarter. This growth was driven by robust performance across both fund-based and non-fund-based earning streams.
Interest Income and Non-Fund Income
NBP’s gross interest income surged by 30.1% year-on-year, closing at PKR 562.2 billion. This represents an increase of PKR 130.3 billion compared to the same period in 2023. However, the bank’s cost of funds also rose significantly by 36.7% year-on-year, reaching PKR 490.8 billion. As a result, net interest income saw a slight decrease of 2% year-on-year, ending at PKR 71.8 billion.
The bank also recorded a gain on securities amounting to PKR 5.8 billion, contributing to a 31.7% increase in non-fund income, which totaled PKR 25.1 billion. Equity investments generated a dividend income of PKR 3.0 billion, compared to PKR 2.4 billion in the first half of 2023. Fee and commission income from branch banking operations also increased by 14.7% year-on-year, reaching PKR 12.1 billion.
Operating Expenses and Pension Litigation
Operating expenses for the half-year period amounted to PKR 49.1 billion, excluding an extraordinary item, representing an 11.3% increase from the previous year. NBP is currently investing heavily in upgrading its IT systems and infrastructure.
A significant development during this period was the Supreme Court of Pakistan’s dismissal of the bank’s civil review petitions regarding pension litigation. As a result, the bank recognized a total expense of PKR 49.0 billion as an extraordinary item. This led to a sharp decline in profit before tax, which closed at PKR 514.8 million, down from PKR 47.7 billion in June 2023. Profit after tax also fell to PKR 251.1 million from PKR 26.0 billion in the same period last year.
Asset Growth and Financial Position
NBP achieved a significant milestone in its asset base, surpassing the PKR 7 trillion mark. The bank’s total assets reached PKR 7.1 trillion, a 6.6% increase from PKR 6.7 trillion at the end of 2023. Investments grew by 7.0% to PKR 4.7 trillion, while gross advances decreased by 5.6%, closing at PKR 1.54 trillion.
The bank’s liquidity and funding profiles remained strong. Total deposits amounted to PKR 4.1 trillion, with a CASA ratio of 80.1%. Liquidity Coverage and Net Stable Funding ratios stood at 197% and 174%, respectively. The bank’s Capital Adequacy Ratio was 24.72%, slightly lower than 25.47% at the end of 2023, mainly due to an adjustment in equity as per IFRS 9.
Agriculture Financing Milestone
NBP also achieved a major milestone in agriculture financing, becoming the largest lender to the sector. The bank recorded a disbursement of PKR 368 billion and an outstanding loan book of PKR 104 billion.
CEO’s Statement and Future Plans
NBP’s President & CEO, Mr. Rehmat Ali Hasnie, praised the dedication of the bank’s employees. He emphasized the bank’s focus on organizational transformation, digitalization, and financial inclusion, particularly in commercial and rural sectors. NBP remains committed to enhancing service quality, expanding its digital outreach, and increasing its product range to better serve the nation.
