BankIslami’s Profit After Tax grew by 4.1 times to Rs. 1.1 Billion for 2019
The Board of Directors of BankIslami Pakistan Limited (‘The Bank’ or ‘BankIslami’) in their meeting held on February 27, 2020 in Karachi approved the Bank’s audited financial results for the year ended December 31, 2019.
The year 2019 proved to be a remarkable year for BankIslami, where the Bank posted impressive financial results. On the back of an effective business strategy and widespread marketing activity, Bank’s Deposit base grew by 24% to close at Rs. 229 Bn, leapfrogging industry growth of around 10%. With an increase in source base of the Bank, total Assets of BankIslami also increased by 31% during outgoing year where funds were efficiently placed towards Islamic Financing, SLR Eligible Investments and Money Market Instruments. To strengthen its risk absorption capacity, the Bank booked accelerated provisioning on subjective basis against infected portfolio resulting in an improved coverage ratio of 85% as oppose to a coverage ratio of 72% in December 2018.
Owing to increase in Bank’s earning assets and rise in benchmark profit rates, Bank’s net spread earned registered a growth of 79% in 2019 over last year. Combined with this, improvement in cost to income ratio to 63% in 2019 from the ratio of 94% in FY18, buoyed the Bank to generate a profit after tax of Rs.1,087 Mn for 2019, which is 4.1 times higher than profit after tax of Rs. 213 Mn reported last year, Alhamdulillah.
BankIslami, to boost its capital base and support the continuous growth of Balance Sheet, successfully completed issuance of Right Shares amounting Rs. 1.01 Bn during 2019; thereby increasing its paid up capital to Rs. 11.01 Bn.
In line with its strategy to further increase its earning capacity with a robust capital adequacy profile, the Bank is also in the process of issuing Listed Additional Tier-1 Capital (Ehad Sukuk) of Rs. 2 Bn. The Bank has successfully raised Rs. 1.7 Bn in the Pre-IPO phase of Ehad Sukuk during 2019.