BAFL_1HCY20 Result Review , (AKD, Off the Analyst's Desk, Aug 26, 2020)
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AKD Research - Off the Analyst's Desk |
Aug 26, 2020 |
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BAFL: 1HCY20 Result Review (Below Expectation) |
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· Bank Alfalah Limited (BAFL) announced its 1HCY20 earnings today where the bank reported an NPAT of PkR5.8bn (EPS: PkR3.25) vs. PkR6.3bn (EPS: PkR3.56) in the same period last year. For 2QCY20, the bank recorded an EPS of PkR1.62 - flat QoQ but down 8.5%YoY. The result was below our expectations. · Major deviation occurred on account of higher than expected provisioning expense of PkR3.3bn of which as per management ~PkR1.8-2bn was booked to increase loss reserve of the bank in view of COVID-19, and fee income falling short of expectations. · Gross yield of the bank stood at 48.1% for 2QCY20 vis-à-vis 45.5% in the previous quarter and 50.3% in the same period last year. · Non Funded contribution in total income jumped to 27.5% in 2QCY20 vs. 19.5/21.2% in 1QCY20/2QCY19 as the bank benefitted from capital gains of PkR1.8bn, mainly on bonds. · Tight lid on administrative costs (down 7.1%QoQ) contributed in pulling down C/I to 47.1% - the lowest since over a decade. |
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Bank Alfalah Limited is a holding company. The Company's segments include Retail banking, including loans, deposits, trading activity, wealth management and other banking transactions with its retail and middle market customers; Corporate banking, which includes loans, deposits, project financing, trade financing, investment banking and other banking activities with its corporate and public sector customers; Treasury, including liquidity management activities carried out through borrowing, lending and money market operations; Consumer banking, including constitutes consumer financing activities with individual customers; Islamic banking, pertaining to its full scale Islamic Banking operations; International operations, which includes amounts related to its overseas operations, namely, commercial banking activities in Bangladesh and Afghanistan, and wholesale banking activities in the Kingdom of Bahrain, and Others, including merchant banking related activities.
AKD Securities Ltd. is one of the leading securities firm in Pakistan, providing a comprehensive range of investor focused services, including equity brokerage, economic and securities research, investment banking and financial advisory services. AKD Securities accounts for more than 6% of the average daily value of the Karachi Stock Exchange. AKD Securities was the first brokerage house to launch an online trading platform in Pakistan in November 2002 and now has the largest market share with over 6000 customers. This has helped diversify and expand the retail investor base in the country and ushered in a whole new universe of investors to the stock market.
AKD Securities Ltd. caters to a diversified group of domestic and international institutional investors, high net worth individuals and upscale retail clients, including expatriate Pakistanis. With high quality research, unparalleled execution and distribution capability for both regular and large block trades, AKD Securities Ltd. has earned an outstanding reputation in the Pakistani securities industry.Outside of commercial banks, AKD Securities Ltd. is one of the biggest capital market firms in the country. AKD Securities is the leader in raising and providing risk capital in underwriting, market making and mergers and acquisitions in Pakistan. Good corporate governance and professionalism are emphasized throughout the firm and AKD Securities Ltd. is amongst the very few companies to have introduced a firm-wide comprehensive CODE of ETHICS, overseen by an independent compliance manager.Ultimately, our success is based on the quality of service we provide to our customers and the trust and confidence reposed in us by them. Our focus, therefore, remains on customer satisfaction at all levels in the company.
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