In a statement PABC said the bank's operating profit before all taxes for the quarter increased by 78% reflecting strong growth in core banking activities and robust efforts in credit quality management.
The bank closed the FY 2019 with an operating profit before all taxes of
The steeper increase in the taxes and levies on financial services of 58%, which include the Debt Repayment Levy (DRL) undermined the bank's bottom-line to a great extent. This performance translated in to a Post-Tax Profit of
Supported by its superlative performance, the bank managed to increase its Return on Equity and Return on Assets (pre-tax) ratios to 14.5% and 1.52% in 2019 which now rank among the highest in the industry. These ratios stood at 13.73% and 1.28% respectively at the end of 2018. The bank's Net Asset Value per Share as at
Despite the pressure on the margins due to deteriorating industry credit quality and the regulatory cap on the maximum interest rate for loans and advances that prevailed during 2019, the bank managed to maintain a healthy net interest margin of 4.36% which remained fairly unchanged from the previous year which is a commendable feat.
The bank's gross loans and advances book witnessed a modest growth due to the slowdown in private sector credit growth seen across the industry. The bank's gross loans and advances grew by 3.53% during 2019 to reach
The slow deposit growth of 3.3% was a result of the concerted efforts made by the bank to slow down the deposit mobilisation in view of slow demand for credit and also to purge certain large high cost time deposits in view of improving the net interest margin. Further as a result of the concerted efforts, the bank managed to improve CASA ratio by over 100 basis points in 2019.
PABC said 2019 was a year that saw the entire banking sector profit levels coming under pressure due to the substantial increases in both non-performing and under-performing credit, slowing down of the overall growth of credit to the private sector, narrowing margins and the weak macro-economic conditions.
Despite these headwinds,
The bank managed to control impairment provisions in 2019, which resulted in individual impairment charges falling to
'Pan Asia Bank too had its fair share of the sector weaknesses, but yet again proved its mettle especially during the second half with higher earnings and setting stage for growth,'
'The proactive measures taken since mid-2018, has contributed to curtail deterioration in credit quality in comparison to the rest of the industry which witnessed a shocking growth in NPAs. As most of our challenges are now behind us, I believe the prevailing low interest rates and tax rates and the expected policy and political stability would provide the much needed tailwind for the industry to march ahead with much vigour,' Tillekeratne added.
The bank's regulatory capital and liquidity ratios under
In addition to its record breaking financial performance,
© Pakistan Press International, source