Karachi: Habib Bank Limited (HBL) has announced a robust growth in its financial performance for the first half of 2024, recording a 12% increase in profit before tax which reached Rs 57.8 billion. This significant growth is attributed to enhanced business operations and an increased focus on client services, resulting in a profit after tax of Rs 29.1 billion, up 10% year-over-year. Additionally, HBL declared an interim cash dividend of Rs 4 per share for the second quarter, maintaining the same rate as the previous interim dividend.
According to Habib Bank Limited, the bank has experienced substantial growth in its balance sheet, which swelled to Rs 6.2 trillion. The total deposits by the end of June 2024 stood at Rs 4.8 trillion, marking an increase of over Rs 700 billion since December 2023. This growth was primarily fueled by domestic deposits, which also led to an expansion in HBL’s market share. The low-cost deposits accounted for approximately 60% of this increase, with the CASA ratio improving to 87%. Despite a subdued credit demand nationwide, HBL reported a 2.2% rise in domestic advances, totaling Rs 1.8 trillion.
The bank’s revenue streams also saw notable increases, with net interest income climbing to Rs 121.6 billion and non-fund income soaring by 64% to nearly Rs 40 billion over the previous year. Fee income, a significant component of non-fund income, grew by 22%, driven largely by the bank’s leading Cards business. The overall revenue for HBL in the first half of the year reached Rs 161.1 billion, a 17% increase from the previous year.
HBL managed to keep its expenses in check despite ongoing inflationary pressures, reducing its cost/income ratio to 56.7% in Q2 from 57.2% in Q1. This efficient cost management supported a growth in internally generated capital, raising the Tier-1 Capital Adequacy Ratio to 12.65% and the total Capital Adequacy Ratio to 16.32%.
Muhammad Nassir Salim, President and CEO of HBL, commented on the results, stating that the bank’s strong performance reflects its commitment to innovation, expanding its digital footprint, and delivering superior financial solutions to all client segments. He highlighted that HBL’s initiatives have been recognized by Euromoney, awarding HBL as Pakistan’s Best Bank.