MCB Records Earnings down 17%

Staff Reporter:

MCB Bank Limited (MCB) announced 1QCY25 results today wherein the bank posted an unconsolidated net earnings of Rs13.8bn (EPS Rs11.7) down 17%YoY

The decrease in earnings is primarily attributed to a decline in interest income.

The bank announced a cash dividend of Rs9 per share in 1QCY25. MCB’s interest earned clocked in at Rs69.8bn (down 22%YoY), while interest expense for the period stood at Rs34.7bn (down 32%YoY). As a result, NII declined to Rs35.2bn, (down 8%YoY).

MCB Bank Expects MPC to Cut 100bps in September

This reduction in NII was mainly driven by a decline in yields on earning assets, following the policy rate cut from 22% to 12% since June’24.

Non-interest income remained flat at Rs9.2bn, primarily due to stable income from dividends, foreign exchange, and fee & commission.

However, the bank recorded a loss on government securities during the period. ▪ Non-interest expenses increased to Rs17.6bn (up 20%YoY) driven by a surge in operating expenses.

MCB’s cost-to-income (CIR) ratio surged to 40% compared to 31% (up 9pptYoY) in same period last year. The bank recorded a provisioning reversal of Rs2.5bn. Additionally, the effective tax rate for the quarter increased to 53%, (up 9pptYoY).