Bank Al Habib (BAHL): 3Q2020 EPS at Rs5.39, up by 135% YoY (above industry expectation)
- Bank Al-Habib (BAHL) posted consolidated earnings of Rs5.39/share for 3Q2020, up by 135% YoY and 36% QoQ primarily due to higher Net Interest Income (NII), which expanded by 62% YoY and 8% QoQ.
- While a decline in NII was expected, the deposit mix of the bank enabled it to reduce Interest Expense by 6% QoQ. With Interest Earned standing ground, NII expanded by 8% QoQ.
- Fee Income increased by 26% QoQ followed by Dividend Income (+98% QoQ) and Forex Income (+35% QoQ), leading to an overall increase in Non Funded Income by 40% QoQ.
- The bank was also able to surpass pre-COVID 1Q2020 NFI level of Rs2.2bn.
- Operating expenses saw a decline of 1% QoQ. This has been most impressive given that the bank had added 56 branches to its network in 1H2020. Cost to Income for the quarter came in at 43% vs. 49% in 2Q2020.
- Provisioning continued for the bank (1) in order to maintain 100%+ coverage ratio and (2) likely as a precautionary measure in the General segment.
- Effective tax rate of the bank clocked in at 41% in 3Q2020.
Bank AL Habib Limited is a banking company. The Bank operates through Retail banking, Commercial banking, Retail brokerage and geographical segments. Its Retail banking consists of retail lending, deposits and banking services to private individuals and small businesses. The retail banking activities include provision of banking and other financial services, such as current and savings accounts, and credit cards to individual customers, and small and medium enterprises (SMEs). Its Commercial banking represents provision of banking services, including treasury and international trade-related activities to corporate customers, multinational companies, and government and semi government departments and institutions. Its Retail brokerage activities include the business of equity, money market and foreign exchange brokerage, equity research, and corporate financial advisory and consultancy services. It operates in four geographic regions: Pakistan, the Middle East, Asia Pacific and Africa.
Topline Securities is one of the fastest-growing brokerage houses in Pakistan. It has strong Equity Brokerage, Economic/ Equity Research, Commodity Trading and Corporate Finance & Advisory functions.
Topline Securities has been endowed with numerous awards by renowned international financial organizations. The highlights of which consists of the award for ‘Best Local Brokerage House of Pakistan’ by Asiamoney Brokers Poll (the largest Asia-focused equity services provider poll) in 2016 and ‘Best Equity Brokerage House’ by CFA Society Pakistan in 2015.
Previously, Topline Securities held the title for ‘Best Brokerage House’ for 4 consecutive years (2011-2014) by Asiamoney Brokers Poll. Other awards include the ‘Best Salesperson’ award by Asiamoney for 6 consecutive years (2011-2016), the ‘Arabia Fast Growth 500’ award and ‘Pakistan Fast Growth 100’ award in 2012 and 2013 by AllWorld Network.
JCR-VIS, a credit rating agency providing independent rating services in Pakistan has assigned initial rating of “A-2” for short term and “A” for long term to Topline Securities. Topline Securities is registered as Underwriter, Book Runner and Research Entity with Securities & Exchange Commission of Pakistan (SECP).
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