04 Apr

BOP Announces Financial Results

BOP

LAHORE: A meeting of the Board of Directors of The Bank of Punjab (BOP) was held on April 25, 2018 wherein Annual Audited Financial Statements of the Bank for the year ended December 31, 2017 and Un-audited Financial Statements for 1st quarter of year 2018 ended March 31, 2018 were approved by the Board.

The financial viability created through capital management measures and superb performance of the Bank in the past few years has enabled the Bank to take an important step of fully providing for the legacy Non-performing loans portfolio (NPLs), covered through Letters of Comfort (LOC) issued by the Government of Punjab (GOP), as of December 31, 2017 i.e. well before the expiry date of December 31, 2018.

All stakeholders are well aware of the fact that financial mess created by imprudent lending decisions of previous management forced the Bank to agree upon a way forward with the Regulator and Sponsors which included certain NPLs provisioning relaxations. And while the Bank has been continuously posting phenomenal financial results in past few years, benefit of Bank’s performance could not be fully passed on to the shareholders due to said relaxations constraining payouts under the applicable Prudential Regulations. Therefore, the BOD took the historic step of making full provision and that too full one year prior to the expiry of the LOCs to make good the provisioning shortfall thereby meeting the SBP’s provisioning requirements and also paving way to meet Capital Adequacy Ratio (CAR) requirement through a comprehensive Capital Management Plan .As such, major impediment hindering Dividend payouts to shareholders now stands removed.

It is pertinent to mention that providing legacy NPLs is no way adversely affecting Bank’s resolve to recover the same through all available legal means. The Bank would continue to make vigorous efforts as before for recovery of these NPLsand future recovery would provide additional boost to Bank’s profitability.

During the year 2017, Net Interest Margin (NIM) of the Bank improved significantly to Rs. 15.6 billion as against Rs. 12.2 billion during last year thereby reflecting a healthy growth of 28%. The Bank earned operational profit of Rs.8.7 billion during the year 2017. However, the Bank charged additional provision of Rs. 12.3 billion against loans covered under LOCs and registered after tax loss of Rs.(3.3) billion for the year 2017. Had said provision not been charged, Bank’s profit after tax would have been Rs.4.7 billion. Despite huge provisioning, the book value per share remained above par.

As on December 31, 2017, the Deposits of the Bank stood at the level of Rs. 556.3 billion as against Rs. 453.2 billion last year, thereby showing a healthy growth of 23%. The gross advances and investments stood at Rs. 341.7 billion and Rs. 242.5 billion, respectively. The Bank’s Total Assets as on December 31, 2017 stood at Rs. 649.5 billion as against Rs. 545.2 billion as on December 31, 2016.

Approval of unaudited financial statements

Maintaining the pace of growth and operating performance of last years, during the 1st quarter of year 2018, Net Interest Margin (NIM) of the Bank improved to Rs. 4.7 billion as against Rs. 3.3 billion during corresponding period of last year. Non Mark-up/Interest Income and Non Mark-up/Interest Expenses remained at Rs. 0.9 billion and Rs. 2.8 billion, respectively. Accordingly, the Bank was able to post a pre-tax profit of Rs. 3.0 billion as against Rs. 2.4 billion for corresponding period last year thereby registering a rise of 25%. Similarly, the Earnings per share (EPS) for the 1st quarter of the year 2018 remained at the level of Rs. 0.73 per share.

Bank Of Punjab(BOP)

As on March 31, 2018, Bank’s Total Assets stood at Rs. 655.3billion. The Deposits of the Bank touched the level of Rs. 569.6billion, while the gross Advances and Investments were recorded at Rs. 357.2billion and Rs. 213.3 billion, respectively. The Tier-I Equity also improved to Rs. 28.8 billion as against Rs. 26.8 billion as on December 31, 2017.

Pursuing an aggressive expansion plan, the Bank is rapidly expanding its outreach to unbanked areas of the country. The Bank now has a network of 540online branches, including 70 Islamic Banking Branches, strategically located across the country. Further, Bank also has a vast network of 406ATMs providing 24/7 banking services to the customers.

The Board appreciated the efforts of Management team led by Bank’s President/CEO, Mr. Naeemuddin Khan. The BOD lauded the successful execution of strategic business plan which helped in above narrated remarkable historical financial turnaround and cleaning of Balance Sheet. The Bank’s strategy of restructuring, expansion and consolidation has enabled it to attain new heights and, in post LOCs era, the shareholders shall reap the benefits of their persistent and enduring support.

The financial viability created through capital management measures and superb performance of BOP in the past few years has enabled the Bank to take an important step of fully providing for the legacy NPLs, covered through Letters of Comfort (LOCs) issued by the GOPb, as of December 31, 2017 i.e. well before the expiry date of December 31, 2018.

While the Bank has been continuously posting phenomenal financial results in past few years, benefit of performance could not be fully passed on to the shareholders due to non-provisioning covered under LOCs. The Bank took the historic step of making full provision and that too one year prior to the expiry of the LOCs to make good the provisioning shortfall. As such, major impediment hindering dividend payouts to shareholders now stands removed.

Making provision against legacy NPLs is no way will adversely affect the Bank’s resolve to recover the same through all available legal means. The Bank would continue to make vigorous efforts as before for recovery of these NPLs and future recovery would provide additional boost to Bank’s profitability.

The Bank earned before tax profit of Rs.3.0 billion during 1st quarter of 2018. The announcement of our results today have been taken very positively by the stock exchange and leading business houses of the country. BOP’s share hit the upper lock the moment stock exchange opened today and within an hour 9.0 million shares traded. We are receiving congratulatory messages from all and sundry, and BOP is standing tall today.

This Article is Originally Published by www.dailytimes.com.pk

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