LAHORE: Askari Bank has posted 42 per cent increase in its profits as the bank earned Rs3.03 billion in the second quarter of calendar year 2015 against Rs2.14 billion of the corresponding period last year.
According to the bank, the growth is after absorbing an additional 4 percent of super tax charge and the retrospective application of uniform tax rate on dividend and capital gains. Profit before tax increased by 77 percent. Earnings per share (EPS) were reported at Rs.2.41 against Rs.1.70 for the corresponding first half of the previous year. The Bank’s total asset base touched Rs500 billion, a growth of 12 percent during the six months.
Askari Bank’s focus on building low-cost deposits has fared well for its net interest margins, which have seen remarkable improvement of 33 percent, despite pressure on net interest spreads owing to steep decline in benchmark rates. Customer deposits grew by 9 percent to Rs422.5 billion, primarily in current and savings deposits.
The cost effective deposit accumulation with a 23 percent increase in current accounts, has enabled the Bank to restrict the rise in interest expense to 9 percent. Non-fund income of the Bank also grew significantly by 56 percent over the same period last year, mainly contributed by the gains realized on equity and bond portfolio.
Growth in administrative expenses was contained at around 8 percent, despite the additional cost of 89 branches that were opened during the period of one year from June 30, 2014. As a result, the Bank’s cost-to-income ratio improved significantly to 51 percent from 66 percent of June 30, 2014 level.
