Meezan Bank (MEBL): 2QCY19 EPS Rs3.2, up by 88% YoY (in-line with our estimate)
- Meezan Bank Limited (MEBL) announced PAT of Rs4.1bn in 2Q2019 (EPS Rs3.2, up 88% YoY) on the back of increase in net spread earned; up by 77% YoY. The bank also announced interim cash dividend of Rs1.0/share.
- Cumulative earnings for 1H2019 of the bank clocked in at Rs5.4 per share; up by hefty 69% as compared to Rs3.2 in the corresponding period last year.
- We attribute significant rise in net spread earned to the non-applicability of Minimum Deposit Rate (MDR) on Islamic banks which has resulted in higher sensitivity of income to the tightening monetary policy.
- MEBL’s other income grew by 21% YoY to Rs2.5bn, wherein fee & commission income and foreign income grew by 34% YoY and 57%YoY, respectively.
- Other expenses during the outgoing quarter were up 27% YoY to Rs6.1bn. This was on the back of 26% increase in operating expenses.
- Effective tax rate of the bank clocked in at 40% as compared to 43% in the same period last year.
- Key risks for the bank include 1) deterioration in Pakistan macros, 2) uptick in provisioning charge, & 3) lack of investment avenues.
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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