Meezan Bank posts 11% decline in earnings for 1st quarter

Meezan Bank Limited (MEBL) announced a net profit of PKR 22.4 billion, translating into earnings per share (EPS) of PKR 12.32 for the quarter ended March 30, 2025, reflecting an 11% decline compared with a profit of PKR 25.08 billion and EPS of PKR 13.93 in the same period last year. The earnings came in line with market expectations.

The bank's earnings contracted due to a dip in net interest income (NII) and higher operating expenses, according to an analyst at Arif Habib Limited.

Along with the results, MEBL announced a cash dividend of PKR 7 per share.

In the first quarter of calendar year 2025 (Q1CY25), the bank reported a net profit of PKR 61.8 billion, reflecting an 8% decline compared with the same period last year.

“This decline in spread is due to a decrease in interest rates, along with the imposition of the Minimum Deposit Rate (MDR) on the individual portfolio,” an analyst at Topline Securities said.

During the outgoing quarter, the bank experienced a 33% increase in non-funded income, driven primarily by higher fee income, which rose by 21.9% year-over-year, and FX income, which increased by 22%.

The bank posted a provisioning charge amounting to PKR 1.8 billion in Q1CY25, compared with a charge of PKR 263 million in the same period last year and a charge of PKR 6.7 billion in the previous quarter.

The effective tax rate for the bank was set at 54.5% during Q1CY25, up from 52.2% in the same period last year.