Pakistan Banks_MCB, HBL & UBL_ 1HCY20 Result Previews, (AKD Daily, Jul 21, 2020)
- The result season for the banking sector is to commence soon with HBL due to hold its BoD meeting on Jul 24’20. In this backdrop, we estimate 1HCY20 earnings for the Big-3 private banks at PkR37.2bn, +58.6%YoY with 2QCY20 earnings (PkR21.6bn, +38.6%QoQ/92.2%YoY) growth driven by HBL. We expect these banks to skip dividends for the 2QCY20 under directives from the Central Bank.
- For HBL, we expect 1HCY20 earnings of the bank to clock in at PkR12.2bn (EPS: PkR8.5), +3.1xYoY given normalization in admin costs post US windup in 1QCY20 (the bank pre-booked US related costs of PkR4bn or PkR1.7/sh in 1QCY20 as per management).
- 1HCY20 earnings for United Bank Limited (UBL) is estimated to clock in at PkR10.6bn (EPS: PkR8.66) +16.0%YoY where sharp cut in interest rates has brought bank’s PIB book (28.0% of deposits) back from the brink driving NII up 27.4%YoY.
- MCB Bank Limited (MCB) is likely to post an NPAT of PkR7.9bn (EPS: PkR6.64) in 2QCY20 as against PkR/sh 5.58/4.6 reported in 1QCY20/2QCY19 driven by repricing factor overshadowing increase in minimum deposit rate on saving deposits.
Habib Bank Limited is engaged in commercial banking and asset management related services in Pakistan and overseas. The Bank's segments include Branch Banking, which consists of loans, deposits and other banking services to agriculture, consumer, small and medium-sized enterprise (SME), and commercial customers; Corporate Banking, which consists of lending for project finance, trade finance and working capital to corporate customers and it also provides investment banking services, including services provided in connection with mergers and acquisitions; Treasury, which consists of trading, fixed income, equity, derivatives and foreign exchange businesses, and it also includes credit, lending and funding activities with professional market counterparties; International Banking, which is engaged in monitoring and reporting purposes and consists of its operations outside of Pakistan, and Head Office/Others. It operates in Pakistan; Europe, Middle East and America, and Asia and Africa.
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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