Karachi: Bank Alfalah Limited (BAFL) conducted a corporate briefing today, revealing insights into its financial performance and future outlook. The briefing highlighted a 23% decline in profit after tax, amounting to Rs8.2 billion, and translated to earnings per share (EPS) of Rs5.22 for the recent quarter. The first half of the calendar year 2025 saw an EPS of Rs9.68, alongside a dividend per share (DPS) declaration of Rs2.5, taking the total payout to Rs5 per share for the half-year.

The bank is projecting an average deposit growth of approximately 15% for the calendar year 2025, with a strategic emphasis on expanding current accounts. The gross advances-to-deposit ratio (ADR) has decreased from 54% in December 2024 to 46.2% in the latest figures.

During the second quarter of the calendar year 2025, yields on advances and investments were reported at around 12.2% and 12.4%, respectively. The cost of deposits was recorded at 5.7%, while the cost of funds was slightly higher at 7.6%. The bank's capital adequacy ratio (CAR) stands at 17.67% as of June.

Investments have seen a decline as the bank liquidated a significant portion of its holdings in June, reducing from Rs1.9 trillion in December 2024 to Rs1.6 trillion by June 2025. Fixed-rate Pakistan Investment Bonds (PIBs) form 35-36% of the investment portfolio, with an average yield of approximately 13.7% and a duration of about 2.3 years.

The management noted that operating expenses have risen, largely due to marketing costs linked to the remittance scheme and branch expansion, though these are expected to partly normalize in upcoming quarters. The bank's digital application, Alfa, has attracted over 1.1 million users.

For the full calendar year 2025, the cost-to-income ratio is anticipated to remain within the 50-56% range, primarily due to the extensive retail banking setup and relatively new infrastructure. The management also disclosed the addition of 33 new branches in the first half of the year, with modest expansion plans for the second half. Currently, 38% of the bank's 1,184 branches operate under Islamic banking principles.