NBP posts net profit of Rs.23 billion in 2017

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KARACHI:The National Bank of Pakistan (NBP) has earned after-tax profit amounting to Rs.23.03 billion; 1.2 percent higher than Rs.22.75 billion for 2016.

This translates into the highest-ever earnings per share of Rs.10.82.The Bank's pre-tax profit figured at Rs.35.6 billion.

Healthy growth in balance sheet size was also recorded at Rs.2,370 billion depicting a 20 percent growth year-on-year.

The Bank's gross loans and advances increased by Rs.75.5 billion reaching Rs.857 billion.

A nominal growth of 1.16 percent only was observed in non-performing loans. Investment also increased by Rs.72.4 billion and reached Rs.1,296 billion.Similarly the Bank's deposits also increased by Rs.69.8 billion to Rs.1,727 billion, said NBP President, Saeed Ahmed, during a media briefing here at National Bank Building.

He said that by maintaining its position in the industry, the bank reported highest-ever profit after-tax numbers in its 69 years history.Despite generally a difficult year for the banking industry, the NBP recorded an overall positive performance.

Operating income of the bank for the year amounted to Rs.85.3 billion and in 2016 it was Rs.84.8 billion. The net mark-up income amounted to Rs.54.3 billion i.e. 1 percent lower against Rs.54.8 billion of prior year; a 3.7 percent growth was observed in non-interest income which amounted to Rs 31.1 billion.

The NBP's Board of Directors approved the financial statements of the bank for the year ending December 31, 2017, in its meeting held here on Tuesday.

The board deliberated at length whether or not cash dividend or bonus shares should be recommended. However, the likely impact of pension case, despite some positive signals, still remained a cause of concern.

The first priority of the board was to maintain continuity of bank's business which was very much dependent upon the capital base of the bank.

The board was conscious of the fact that the shareholders looked forward to receiving dividend.

However, eventually it was considered more prudent to retain the profits for the time being and once the position become clearer and positive, The Bank might consider declaration of dividend at a later stage.

Accordingly, it did not recommend any dividend for the year 2017, hesaid.

He informed that the bank had filed review petition against the judgment of the Supreme Court of Pakistan in the pension case and had also moved an application for constitution of a larger bench which had been accepted.

Pending the decision of review petition, financial impact of the subject case had not been included in the financial statements as the bank looked forward to a favourable outcome of the case.

Saeed Ahmed said NBP was continuously expanding its market outreach through adding to its product range, restructuring its business model and adopting the modern-day delivery strategies. Provision of services through Alternative Delivery Channels and Customer Service Quality were now among top priorities of the bank.

During the year, Islamic Banking branches of the bank increased from 118 to 169. With 'AAA' credit rating, the bank was a driving force in financial industry with its large distribution network domestic and international branches, and a wide range of products and services.

For addressing structural issues of the field management of the bank, the board of directors had approved restructuring of Commercial and retail set-up in the field by adopting a flat reporting system empowering the region & field management team and giving them distinct business targets to achieve better results in an area which needs attention.

A presentation was also given on NBP's operations and future projects. During question and answer session, the NBP President informed that the bank was going to introduce new products next month.

He said that the NBP had signed memorandum of understanding (MoU) with Pakistan Postal Services to compete and discourage Huni Hawala transactions.

It also signed agreements with United Bank Limited and Jazz mobile network for the same.

The NBP was the only bank having inter-operational network.

To a query, he said non-performing loans (NPLs) were the hindrance to opening its branch in China. However, he continued, his bank's NPL were only single digit.

About starting Pakistan's banking network in Iran, he said the State Bank of Pakistan was working on the issue.

To another question, he admitted that a lot was to be done for ensuring corporate culture at NBP's branches in the country.

'I admit that the attitude of employees at most of the NBP branches wasnot good,' he said. APP/AFP

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