AsiaNet-Pakistan Premier Editorial Content and Press Release Distribution Service
Karachi: Faysal Bank Ltd (FABL) has reported a modest improvement in its third-quarter profits for the calendar year 2025, driven by an increase in core income. The bank announced a net profit after tax (NPAT) of PkR4.9 billion, equating to an earnings per share (EPS) of PkR3.3. While this represents a 23% decrease year-on-year, it marks a 3% increase from the previous quarter. The results align with expectations, though the announced interim cash payout of PkR1.5 per share fell short of the anticipated PkR2 per share.
The bank’s net spread earned was PkR17.6 billion, reflecting a 19% decline from the same period last year due to lower interest rates. However, it increased by 2% from the previous quarter, attributed to a growth in the investment book.
Profit on Islamic financing was PkR40.9 billion, showing a 28% year-on-year drop and a 2% quarterly decrease. Meanwhile, profit on deposits was recorded at PkR23.3 billion, declining by 34% year-on-year and 6% quarter-on-quarter. Despite these declines, the bank’s net interest margins improved slightly to 5.04% from 4.97% in the previous quarter.
Non-interest income saw a significant rise, recording PkR7.5 billion, which is more than double the previous year’s figure and a 33% increase from the previous quarter. This growth is attributed to a substantial gain on the sale of securities.
Operating expenses rose to PkR14.9 billion, an 18% increase year-on-year and a 12% rise from the previous quarter. The cost-to-income ratio stood at 59.3%, compared to 50.7% in the third quarter of the previous year and 58.3% in the preceding quarter.
The bank recorded a credit-allowance provisioning reversal of PkR690 million, compared to a reversal of PkR562 million in the same quarter last year and PkR1.2 billion in the second quarter of 2025.
The effective tax rate for the quarter was 54.3%, slightly varying from 49.6% in the same period last year and 54.8% in the previous quarter.
Analysts from AKD Securities Limited maintain a ‘Buy’ stance on Faysal Bank, with a target price of PkR110.0 per share by June 2026, citing robust deposit growth, stabilization of net interest margins, and strong asset quality as key factors for their positive outlook.