Karachi: Bank Al-Habib Limited (BAHL) announced its financial results for the second quarter of the calendar year 2025 today, revealing a decline in net profit after tax to PkR9.1 billion, equivalent to earnings per share of PkR8.2. This represents a decrease of 18% year-on-year and 11% quarter-on-quarter, primarily attributed to lower net interest income and higher operating expenses.
Net interest income for BAHL was recorded at PkR32.8 billion, reflecting a drop of 13% from the same period last year and 2% from the previous quarter. The decline in yields was cited as a key factor in this decrease.
Mark-up earned fell to PkR85.1 billion, down 31% year-on-year and 8% quarter-on-quarter, while mark-up expensed was PkR52.3 billion, a decrease of 39% year-on-year and 12% quarter-on-quarter. The bank's net interest margins also saw a reduction, dropping to an estimated 4.3% in the second quarter from 4.6% in the previous quarter.
Non-interest income increased by 16% year-on-year to PkR7.6 billion, driven by a 47% year-on-year rise in foreign exchange income and a 58% increase in dividend income. However, it experienced a 2% decline quarter-on-quarter due to a 32% decrease in foreign exchange income and a 5% decrease in fee income.
Operating expenses rose to PkR23.4 billion, marking a 5% increase year-on-year and 7% quarter-on-quarter. This led to a cost-to-income ratio of 57.9%, compared to 50.4% in the second quarter of 2024 and 52.9% in the first quarter of 2025.
The bank recorded a credit allowance/provisioning reversal of PkR1.5 billion, contrasting with an expense of PkR517 million in the previous quarter and a reversal of PkR1.2 billion in the same quarter last year.
The effective tax rate for the quarter stood at 50.7%, compared to 48.0% and 50.4% in the second quarter of 2024 and the first quarter of 2025, respectively.
BAHL also declared an interim cash payout of PkR3.5 per share, bringing the total cash payout for the first half of the year to PkR7.0 per share. The bank's financial performance is currently under review, as reported by AKD Securities Limited.