UBL Posts a 63% Decline in Profits in Q1 2018

United Bank Limited (UBL) has announced its financial results for Q12018 where the bank reported earnings of Rs 2.64 billion, down by 63.62% as compared to Rs 7.25 billion in the corresponding period last year. The earnings per share of the bank was down to Rs 2.16 from Rs 5.93. Along with the result, UBL has announced an interim dividend of PKR 3/share. The result was below the market expectations mainly due to the recognition of Rs 6.4 billion (Rs5.2/share before tax) one-off expense relating to pension case liability. ALSO READ Three of Pakistan’s Largest Banks Are Up for Sale In Q1 CY2018, Net Interest Income (NII) stayed flat YoY while Non-Markup Income surged by 11% mainly due to 34% higher capital gains in the quarter. Provision expenses stayed on the higher side which can be attributed to provisioning expenses pertaining to the bank’s UAE loan book. Non-core income of the bank increased by 16%YoY mainly on account of higher capital gains (Rs 3.1billion) whereas operating costs of the bank remained relatively flat (+2%YoY), which alleviated some pressure on bank’s bottom-line. ALSO READ Pakistan Plans to Borrow a Record $13 Billion Next Year On a sequential basis, PBT ( Pension costs ) was up 18.9% on the back of higher capital gains which more than offset the decline in fee income of 21.1% and 14.6% increase in provisioning costs. The non-mark up income grew by 15% YoY to Rs 8 billion with a 34% increase in gain on sale of securities. UBL’s share at the bourse closed at Rs 201.30, down by 0.16% with a turnover of 0.57 million shares.