Faysal Bank Reports Record Profitability for CY24

Faysal Bank Limited (FABL) has reported its highest-ever profitability in Calendar Year 2024 (CY24), with net earnings reaching PKR 23.9 billion, reflecting an 18% year-on-year (YoY) growth. Despite the strong annual performance, the bank’s 4QCY24 earnings witnessed a significant decline of 55% YoY and 48% quarter-on-quarter (QoQ), posting a profit after tax (PAT) of PKR 3.5 billion (EPS: PKR 2.3) compared to PKR 5.2 EPS in 4QCY23. Alongside the results, FABL announced a final dividend of PKR 2.5 per share, bringing the total dividend for CY24 to PKR 7.0 per share.

Key Financial Highlights:

• Net Profit Earned (NPE): Stood at PKR 20.6 billion in 4QCY24, reflecting a 6% YoY and 5% QoQ decline. However, for the full year, NPE grew 13% YoY to PKR 80.6 billion.
• Non-Funded Income (NFI): Increased significantly by 9% YoY and 56% QoQ in 4QCY24, totaling PKR 19.6 billion for CY24 (+50% YoY growth). The surge in NFI was driven by:
  • Fee and commission income: Up 36% YoY, reaching PKR 12.8 billion.
  • Gain on securities: PKR 1,042 million, a notable recovery from a PKR 1,812 million loss in CY23.
  • FX income: Increased 12% YoY, amounting to PKR 5.3 billion.
  • However, other income saw a sharp 87% YoY decline in CY24.
• Provisioning Reversal: FABL recorded a PKR 1.1 billion provisioning reversal in 4QCY24 compared to PKR 2.8 billion in 4QCY23. For CY24, the total reversal amounted to PKR 2.5 billion, in contrast to a PKR 1.2 billion provisioning expense in CY23.
• Operating Expenses (OPEX): Increased by 21% YoY to PKR 15.7 billion in 4QCY24 (from PKR 13.0 billion in 4QCY23), bringing the Cost-to-Income ratio to 59%, up from 47% in the previous year’s quarter.
• Taxation: The effective tax rate rose to 70.9% in 4QCY24, compared to 54.2% in the same quarter last year, bringing the CY24 tax rate to 53.8% (CY23: 51.6%).

Despite the quarterly earnings dip, FABL’s overall growth trajectory remains strong, supported by a surge in total income and non-funded income, along with strategic cost management.