Habib Bank Limited (PSX: HBL) has announced a record profit before tax of Rs. 120.3 billion for the year ended December 31, 2024, marking a 6 percent increase compared to 2023. The profit after tax stood at Rs. 57.8 billion, following a significant rise in the government-imposed tax rate on banks to 54 percent.
The Earnings Per Share (EPS) for 2024 was Rs. 39.85, up from Rs. 39.32 in 2023.
In conjunction with these results, the Bank declared a final Cash Dividend of Rs. 4.25 per share (42.5 percent) for the year ended December 31, 2024. This is in addition to the interim Cash Dividend(s) already paid at Rs. 12 per share (120 percent).
HBL's balance sheet grew by 9 percent to Rs. 6.1 trillion, with total deposits closing at Rs. 4.4 trillion, reflecting a growth of Rs. 228 billion over December 2023. Domestic deposits increased by Rs. 187 billion, reaching Rs. 3.6 trillion, with the CASA ratio showing strong improvement to nearly 90 percent.
HBL's total advances rose by over 30 percent to Rs. 2.4 trillion, with the domestic lending book surpassing Rs. 2.0 trillion. The flagship consumer portfolio continued its growth trajectory, reaching Rs. 143 billion, while the Group's agriculture financing exceeded Rs. 100 billion.
Despite significant monetary easing, which saw a 900 basis points reduction in the SBP's Policy Rate over the year, HBL's net interest income increased to Rs. 246 billion. This was supported by a 17 percent volumetric expansion in the average domestic balance sheet and improved spreads in international business.
Non-fund income grew impressively by 68 percent to Rs. 96.5 billion, driven by a strong contribution from the Treasury business. The fee franchise delivered excellent double-digit growth, increasing by 17 percent to Rs. 49.5 billion. Cards contributed more than 50 percent of the increase, along with solid contributions from Bancassurance and retail banking. As a result, HBL's total revenues increased by 14 percent to an industry-leading Rs. 342 billion.
Efforts to optimize costs have contained administrative expense growth to 13 percent, improving the cost/income ratio to 56.3 percent in 2024. Despite an uptick in non-performing loans, the infection ratio is at an all-time low of 4.3 percent. HBL's sustained profitability has led to a strong improvement in the Capital Adequacy Ratio, which increased from 16.0 percent in Dec’23 to 17.7 percent, well above required levels.
Commenting on the Bank's results, Muhammad Nassir Salim, President & CEO – HBL, said, “HBL continues to deliver value for its stakeholders while navigating an increasingly complex external environment. The strong 2024 financial results affirm the Bank’s strategic direction. The Bank is proud to serve its valued clients and play its due role in the economic development of Pakistan.”
Delivering Value for Stakeholders HBL is committed to providing comprehensive support to the crucial agriculture sector to enhance national food security. Earlier this year, HBL launched HBL Zarai Services Limited, a wholly-owned subsidiary aimed at revolutionizing the agricultural value chain. HBL Zarai focuses on boosting local farming productivity and fostering inclusive growth by providing farmers with agronomy services, crop inputs, access to modern mechanization, and more.
These services are offered through Zarai Deras, specialized distribution and service centers in Burewala, Sahiwal, Pakpattan, and Sadoke. By improving access to essential resources, HBL Zarai enhances farmer productivity, contributing to the economic development of Pakistan's agricultural sector.
HBL is the largest lender and mobilizer of government agriculture financing subsidies, including solar tube wells, tractors, and livestock. With a total portfolio of over Rs. 100 billion, the HBL Group holds the largest market share in both commercial and microfinance agriculture lending in Pakistan.
HBL is fully committed to growing the "S" of SME business in a significant and sustainable way. The Bank's focus is on cash flow-based lending, where it enjoys the highest portfolio in the industry. SME businesses are crucial drivers of the economy and require enhanced access to formal finance. HBL has undertaken numerous initiatives to transform the SME landscape, fostering growth and creating opportunities for small businesses.
As a testament to its efforts, HBL has been recognized as ‘The Best SME Bank’ by the ‘Pakistan Banking Awards’.
HBL remains a thought leader and has actively supported SBP and the World Bank in developing the National Green Taxonomy. This has allowed the Bank to further identify green financing.
