MCB Bank (MCB): 2QCY19 EPS Rs4.6, up 15% YoY, DPS Rs4.0 (estimates in-line)
- MCB Bank Limited (MCB) posted an earnings of Rs4.6/share, up by 15%YoY in 2Q2019 primarily due to 1) NIMs expansion, and 2) higher other income due to exchange rate fluctuations. Cumulative earnings during 1H2019 of the bank clocked in at Rs10.4bn (EPS: Rs8.8); up by 11%YoY.
- Along with the results, the bank announced a cash dividend of Rs4.0/share bringing total dividend to Rs8.0/share in 1H2019.
- The bank’s non mark-up income grew by mere 7%YoY to Rs4.6bn in 2Q2019 primarily on the back of higher foreign exchange income; up by 2xYoY to Rs1.3bn due to exchange rate volatility, however loss on securities of Rs192mn vs gains of Rs382mn tapered off the gains.
- Non markup expenses of the bank recorded a growth of 10% YoY due to higher operating expenses. Other than that, the bank booked provisional expenses of Rs1.3bn vis a vis reversal of Rs731mn in the corresponding period.
- Effective tax rate of the bank clocked in at 39% compared to 41%, while in 1H2019 the said rate settled at 42% vs 40%.
- Key risks for MCB include: 1) higher than expected provisions, 2) lower than expected advances growth, and 3) deterioration of Pakistan macros.
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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