Karachi: Bank Alfalah Limited (BAFL) has reported significant growth in its deposit base and maintained a stable outlook on its financial performance, as communicated in a recent corporate briefing session. The bank's total deposits reached Rs2.6 trillion in September 2026, marking a 21% increase year-over-year, with average deposits growing by 18% YoY. Management forecasts total deposit growth of 15-18% going forward.

According to AKD Securities Limited, the briefing, hosted by Topline Securities, revealed that a substantial portion of the bank's investment portfolio is allocated to fixed-rate PIBs and sukuks, with the remainder in floating-rate bonds and T-bills. The bank's management highlighted that interest rates are expected to remain tight due to the geopolitical situation in the GCC and oil prices in the US$90-110/bbl range. However, there is no immediate need for a rate hike unless oil prices rise further.

The bank anticipates its net interest margins to remain stable, with minor compression offset by volume growth. Additionally, operating expenses are expected to increase due to inflation and the full-year impact of hiring, with a projected cost-to-income ratio of 60-65%.

In the realm of Islamic banking, BAFL will continue to expand its Islamic business, although it is not mandated to fully convert due to foreign shareholding. The bank also faces new expenses related to remittance schemes but intends to optimize costs through better flow management.

The briefing also recalled BAFL's earnings, which rose 46% YoY to Rs9.2 billion, despite a 9% decline from the previous quarter. A cash dividend of Rs1.5 per share was announced for the third quarter of 2026, bringing the nine-month total to Rs4.5 per share.

AKD Securities maintains a Buy stance on BAFL, citing favorable trading ratios and a dividend yield of 10%.