MCB BANK LIMITED a more prosperous and secure future.
Mission
financial solutions to create and nurture long-term relationships with our customers. In doing so, we ensure that our shareholders can invest with confidence in us.
Core Values
The standards and principles which determine our behavior and how we interact with our customers and each other.
Credit Rating
Board of Directors:
Mian Mohammad Mansha | Chairman |
Mr. Muhammad Tariq Rafi | Director |
Mian Umer Mansha | Director |
Mrs. Iqraa Hassan Mansha | Director |
Mr. Muhammad Ali Zeb | Director |
Mr. Mohd Suhail Amar Suresh bin Abdullah | Director |
Mr. Yahya Saleem | Director |
Mr. Salman Khalid Butt | Director |
Mr. Shahzad Hussain | Director |
Mr. Masood Ahmed Puri | Director |
Mr. Shariffuddin Bin Khalid | Director |
Mr. Shaikh Muhammad Jawed | Director |
Mr. Shoaib Mumtaz | President & CEO |
Audit Committee:
Mr. Shahzad Hussain | Chairman | |
Mian Umer Mansha | Member | |
Mr. Muhammad Ali Zeb | Member | |
Mr. Shariffuddin Bin Khalid | Member | |
Chief Financial Officer: | Mr. Hammad Khalid | |
Company Secretary (Acting): | ||
Auditors: | Mr. Farid Ahmad | |
M/s. A. F. Ferguson & Co. | ||
Legal Advisors: | Chartered Accountants | |
M/s. Khalid Anwer & Co. | ||
Advocates & Legal Consultants | ||
Registered /Principal Office: | MCB Building, 15-Main Gulberg, | |
Jail Road, Lahore, Pakistan. | ||
Contact us: | UAN: + 92 42 111 000 622 | |
E-mail: investor.relations@mcb.com.pk | ||
Registrar's and Share Registration Office(s): | Head Office: | |
Visit us: | ||
M/s. THK AssociatesKarachi,(Pvt.)Pakistan.Limited | ||
Plot No. 32-C, Jami, | Commercial Street 2, | |
D.H.A., Phase VII |
Branch Office:
M/s. THK Associates (Pvt.) Limited Office No. 309, 3rd Floor,
North Tower, LSE Building,
19-Shahrah-e-Aiwan-e-Iqbal, Lahore, Pakistan.
3
Directors' Review - September 2023
On behalf of the Board of Directors, we are pleased to present the financial statements of MCB Bank Limited (MCB) for the third quarter ended September 30, 2023.
Performance Review
On a standalone basis, the profit before and after taxation for the period ended September 30, 2023 together with appropriations is as under:
Rs. in Million | |
Profit Before Taxation | 88,095 |
Taxation | 43,949 |
Profit After Taxation | 44,146 |
Un-appropriated Profit Brought Forward | 70,425 |
Surplus realized on disposal of revalued fixed assets - net of tax | 1,097 |
Surplus realized on disposal of non-banking assets - net of tax | 25 |
Re-measurement gain on defined benefit obligations - net of tax | 292 |
Transfer in respect of incremental depreciation from surplus on | |
revaluation of fixed assets to un-appropriated profit - net of tax | 113 |
Profit Available for Appropriation | 71,952 |
116,098 | |
Appropriations: | |
Statutory Reserve | (4,415) |
Final Cash Dividend at Rs. 6.0 per share - December 2022 | (7,110) |
First Interim Dividend at Rs. 6.0 per share - March 2023 | (7,110) |
SecondInterim Dividend at Rs. 7.0 per share - June 2023 | (8,295) |
Total Appropriations | (26,930) |
Un-appropriated Profit Carried Forward | 89,168 |
Through focused efforts of the Bank's management in building no-cost deposits and optimizing its earning assets mix, MCB successfully sustained its growth momentum in core earnings to post historically high nine months Profit Before Tax (PBT) of Rs. 88.1 billion on a standalone basis; registering an impressive increase of 71% on a year-on-year basis. The Profit After Tax (PAT) was recorded at Rs. 44.1 billion (+122%) and translated into an Earning Per Share (EPS) of Rs. 37.25 compared to an EPS of Rs. 16.75 reported in the corresponding period last year.
With concentrated efforts delivering strong volumetric growth in current account and timely repositioning of the asset book resulted in a 73% increase in net interest income for the period under review as compared to corresponding period last year.
Non-markup income increased to Rs. 22.6 billion (+12%) against Rs. 20.3 billion in the corresponding period last year with major contributions coming in from fee commission income (Rs. 14.2 billion), income from dealing in foreign currency (Rs. 5.9 billion) and dividend income (Rs. 2.0 billion).
Improving customer and interbank flows, diversification of revenue streams through continuous enrichment of service suite, investments towards digital transformation and an unrelenting focus on upholding high standards of service delivery supplemented a broad-based growth of 38% in income from fee commission; with trade and guarantee related business income growing by 95%, cards related income by 48%, branch banking customer fees by 12% and income from home remittance by 18%.
4
The Bank continues to manage an efficient operating expense base and monitor costs prudently. Amidst a persistently high inflationary environment, currency devaluation, rapidly escalating commodity prices and continued investments in human resources and technological upgradation, the operating expenses of the Bank were reported at Rs. 37.4 billion (+23%). The cost to income ratio of the Bank improved significantly to 29% from 37% reported in corresponding period last year.
Navigating through a challenging operating and macroeconomic environment, the Bank has been addressing asset quality issues by maintaining discipline in management of its risk return decisions. Diversification of the loan book across customer segments and a robust credit underwriting framework that encompasses structured assessment models, effective pre- disbursement evaluation tools and an array of post disbursement monitoring systems has enabled MCB to effectively manage its credit risk; the Non-performing loan (NPLs) base of the Bank was reported at Rs. 54.6 billion as at September 30, 2023. The coverage and infection ratios of the Bank were reported at 82.86% and 8.45% respectively.
On the financial position side, the total asset base of the Bank grew by 15% and was reported at Rs. 2.39 trillion. Analysis of the assets mix highlights that net investments increased by Rs. 279 billion (+29%) whereas gross advances reported a decrease of Rs. 151 billion (-19%) over December 31, 2022.
The Bank continued its focus on building no cost deposits, leading to a robust growth of Rs. 190 billion (YoY: +30%) in average current deposits. The average current to total deposits ratio improved to 51.5% during the period under review from 41.3% in corresponding period last year. Despite the exceptional increase in interest rates during the period, the domestic cost of deposits was contained at 8.63% as compared to 6.21% in the corresponding period last year.
Return on Assets and Return on Equity significantly improved to 2.63% and 31.84% respectively, whereas the book value per share was reported at Rs. 167.81.
During the period under review, MCB attracted home remittance inflows of USD 2,369 million to further consolidate its position as an active participant in SBP's cause for improving flow of remittances into the country through banking channels; with market share improving to 12.3% compared to 11.4% in the corresponding period last year.
While complying with the regulatory capital requirements, the Bank's total Capital Adequacy Ratio (CAR) is 20.26% against the requirement of 11.5% (including capital conservation buffer of 1.50% as reduced under the BPRD Circular Letter No. 12 of 2020). Quality of the capital is evident from Bank's Common Equity Tier-1 (CET1) to total risk weighted assets ratio which comes to 17.74% against the requirement of 6%. Bank's capitalization also resulted in a Leverage Ratio of 6.05% which is well above the regulatory limit of 3.0%. The Bank reported Liquidity Coverage Ratio (LCR) of 246.89% and Net Stable Funding Ratio (NSFR) of 150.03% against requirement of 100%.
The Board of Directors has declared a 3rd interim cash dividend of Rs. 8.0 per share i.e. 80%, in addition to 130% already paid, bringing the total cash dividend for the nine months period ended September 30, 2023 to 210%.
Ratings
Pakistan Credit Rating Agency re-affirmed credit ratings of MCB at "AAA / A1+" for long term and short term respectively, through its notification dated June 23, 2023.
Economy Review
Pakistan's economy showed signs of improvement in the quarter ended September 30, 2023. The stand-by agreement (SBA) with the IMF, improved current account balance, general decline in the global commodity prices and reduced budget deficit all contributed to this improvement.
5
Inflation remained high throughout the quarter, mainly driven by food and energy prices. Inflation expectations remain elevated for the shorter term. Multiple years of high fiscal deficits have created strong inflationary pressures in the economy. A restrictive policy rate coupled with fiscal discipline should help lower inflation in the medium-term.
The Current Account for the FY 24 (Jul-Aug) reported a deficit of USD 935 million against a deficit of USD 2,035 million in the same period last year, showing the effects of muted demand. At end September 2023, SBP's foreign reserves had increased to USD 7,615 million with the total liquid reserves for the country clocking in at USD 13,030 million. The gradual improvement in the country's balance of payment has resulted in reduced pressure on PKR and bodes well for the medium-term PKR outlook. However, it remains vital that Pakistan successfully concludes the IMF review due in November 23. Any delay in concluding this review will create economic uncertainties for an already stuttering economy.
The Government introduced a wide range of tax measures in the FY24 budget and aims to collect PKR 9.4 trillion in taxes, targeting an increase of 30% from the last year. The total expected expenditure stands at PKR 14.48 trillion with debt servicing consuming 50% of the expenditure. The Government intends to restrict the fiscal deficit to 6.53% of the GDP. The Government comfortably met the revenue targets for the quarter showing strong revenue growth over last year's number.
Prior to signing of the SBA with IMF, the deterioration of the country's economic indicators, and the uncertainty of the IMF program resulted in significant increase in Pakistan's external borrowing costs; Pakistan's Euro Bond yields reflected this distress. However, after a prolonged delay in the 9th review, the breakthrough in the shape of SBA with the IMF restored market confidence. The yields on Pakistan Euro Bonds have since improved.
Future Outlook
Adherence to IMF's SBA is essential for the economic recovery to take foot. Any deviation from the agreed upon IMF agreement may quickly result in economic distress and erode the confidence gained over the last quarter. Pakistan economy is expected to grow at 2-3% for the fiscal year but difficult economic decisions will have to be taken for long-term growth. The inflationary pressures will continue to be a challenge for the country and will begin to ease further in the second half of FY24. Moreover, the influx of external funding remains crucial for which political and economic stability remains vital.
Appreciation and Acknowledgements
The Board of Directors of MCB Bank Limited would like to extend their sincere gratitude towards the Government of Pakistan, the State Bank of Pakistan, the Securities & Exchange Commission of Pakistan and other regulatory bodies for their continued support and guidance, all shareholders and customers of the Bank for their trust, and our employees for their continuous dedication and commitment.
For and on behalf of the Board of Directors,
Shoaib Mumtaz | Mian Umer Mansha |
President & CEO | Director |
MCB Bank Limited | MCB Bank Limited |
October25, 2023 | |
6 | 7 |
122% | |
8 | 9 |
Unconsolidated Condensed Interim Statement of Financial Position
As At September 30, 2023
Unaudited | Audited | ||
Note | September 30, | December 31, | |
2023 | 2022 | ||
ASSETS | ---------Rupees in '000--------- | ||
Cash and balances with treasury banks | 7 | 162,715,362 | 96,368,918 |
Balances with other banks | 8 | 39,214,349 | 24,872,110 |
Unconsolidated Condensed Interim Profit & Loss Account (Un-audited)
For The Nine Months Period Ended September 30, 2023
Quarter Ended | Nine Months Ended | ||
July 01 | July 01 | January 01 | January 01 |
to | to | to | to |
Note | September | September | September |
September | |||
30, 2023 | 30, 2022 | 30, 2023 | 30, 2022 |
---------Rupees in '000--------- |
Lendings to financial institutions | 9 | 91,523,394 | 50,415,768 |
Investments | 10 | 1,257,675,639 | 978,731,140 |
Mark-up / return / interest earned | 25 | 90,101,594 |
Mark-up / return / interest expensed | 26 | 50,693,880 |
55,612,453
33,089,753
235,381,059
128,964,476
141,028,418
79,517,554
Advances | 11 | 601,010,281 | 753,399,576 |
Fixed assets | 12 | 80,909,261 | 79,918,324 |
Intangible assets | 13 | 809,328 | 801,117 |
Net mark-up / interest income
39,407,714
22,522,700
106,416,583
61,510,864
NON MARK-UP / INTEREST INCOME
Deferred tax assets | 14 | 12,542,947 | 7,547,068 |
Other assets | 15 | 144,373,280 | 93,301,143 |
2,390,773,841 | 2,085,355,164 | ||
LIABILITIES | |||
Bills payable | 17 | 10,066,145 | 39,136,884 |
Borrowings | 18 | 289,268,800 | 340,237,265 |
Deposits and other accounts | 19 | 1,715,666,042 | 1,378,717,068 |
Liabilities against assets subject to finance lease | - | - | |
Subordinated debt | - | - | |
Deferred tax liabilities | 14 | - | - |
Other liabilities | 20 | 162,090,816 | 137,769,297 |
2,177,091,803 | 1,895,860,514 |
Fee and commission income | 27 |
Dividend income | |
Foreign exchange income | |
Income from derivatives | |
Gain / (loss) on securities | 28 |
Other income | 29 |
Total non-markup / interest income | |
Total Income |
NON MARK-UP / INTEREST EXPENSES
5,449,356
533,896
2,314,653
1,888
130,307
104,906
8,535,006
47,942,720
3,575,459
433,261
3,855,164
7,919
(572,548)
55,346
7,354,601
29,877,301
14,240,853
2,011,486
5,907,823
14,764
203,168
221,603
22,599,697
129,016,280
10,301,226
1,687,272
7,969,474
19,889
94,703
180,338
20,252,902
81,763,766
NET ASSETS | 213,682,038 | 189,494,650 | |
REPRESENTED BY | |||
Share capital | 11,850,600 | 11,850,600 | |
Reserves | 21 | 97,843,633 | 88,578,024 |
Surplus on revaluation of assets - net of tax | 22 | 14,819,332 | 18,640,651 |
Unappropriated profit | 89,168,473 | 70,425,375 | |
213,682,038 | 189,494,650 | ||
CONTINGENCIES AND COMMITMENTS | 23 |
The annexed notes 1 to 41 form an integral part of these unconsolidated condensed interim financial statements.
Operating expenses | 30 | 13,388,565 |
Workers Welfare Fund | ||
685,078 | ||
Other charges | ||
31 | 290,541 | |
Total non-markup / interest expenses | 14,364,184 | |
Profit before provisions | ||
33,578,536 | ||
Provisions / (reversals) and write offs - net | 32 | (675,395) |
PROFIT BEFORE TAXATION | ||
34,253,931 | ||
Taxation | 33 | 16,794,367 |
PROFIT AFTER TAXATION | ||
17,459,564 | ||
Basic and diluted earnings per share | 34 | 14.73 |
10,861,330
381,024
99,402
11,341,756
18,535,545
(515,656)
19,051,201
10,323,440
8,727,761
7.36
37,367,258
1,761,909
555,284
39,684,451
89,331,829
1,236,364
88,095,465
43,948,869
44,146,596
37.25
30,300,203
1,031,742
162,490
31,494,435
50,269,331
(1,317,754)
51,587,085
31,734,660
19,852,425
16.75
10 | Shoaib Mumtaz | Hammad Khalid | Mian Umer Mansha | Shahzad Hussain | Muhammad Ali Zeb |
President / CEO | Chief Financial Officer | Director | Director | Director |
The annexed notes 1 to 41 form an integral part of these unconsolidated condensed interim financial statements.
Shoaib Mumtaz | Hammad Khalid | Mian Umer Mansha | Shahzad Hussain | Muhammad Ali Zeb | 11 |
President / CEO | Chief Financial Officer | Director | Director | Director |
12 | The annexed notes 1 to 41 form an integral part of these unconsolidated condensed interim financial statements. | Total comprehensive income19,054,7909,209,363 46,703,528 11,145,616 | Movement in surplus on revaluation of non-banking assets - net of tax--(52,418)(28,135) | Movement in surplus on revaluation of fixed assets - net of tax--(459,275)(140,130) | Remeasurement gain on defined benefit obligations - net of tax--292,162164,273 | Items that will not be reclassified to profit and loss account in subsequent periods: | Movement in (deficit) / surplus on revaluation of investments - net of tax1,828,567(998,423) (2,074,486) (9,540,963) | Effect of translation of net investment in foreign branches(233,341)1,480,0254,850,949838,146 | Items that may be reclassified to profit and loss account in subsequent periods: | Other comprehensive income. | Profit after taxation for the period17,459,5648,727,761 44,146,596 19,852,425 | For The Nine Months Period Ended September 30, 2023 | Unconsolidated Condensed Interim Statement of Comprehensive Income (Un-audited) | ||||||||
Shoaib MumtazHammad KhalidMian Umer ManshaShahzad HussainMuhammad Ali Zeb President / CEOChief Financial OfficerDirectorDirectorDirector | --(219,531)(3,992) | 1,595,226481,6022,776,463(8,702,817) | ---------Rupees in '000--------- | 2023202220232022 | September 30, September 30, September 30, September 30, | totototo | July 01July 01January 01 January 01 | Quarter EndedNine Months Ended |
President / CEO | Shoaib Mumtaz |
Chief Financial Officer | Hammad Khalid |
Director | Mian Umer Mansha |
Director | Shahzad Hussain |
Director | Muhammad Ali |
Zeb |
Capital reserve | Exchange | Statutory | Revenue reserve | Surplus/(deficit) on revaluation of | Unappropriated | |||||
Share capital | Share | Non-distributable | Total | |||||||
translation | reserve | General reserve | Fixed / non- | profit | ||||||
premium | capital reserve | Investments | ||||||||
reserve | banking assets | |||||||||
----------------------------------------------------------------------------------------------- | Rupees in '000----------------------------------------------------------------------------------------------- | |||||||||
Balance as at December 31, 2021 (Audited) | 11,850,600 | 23,751,114 | 908,317 | 3,701,067 | 37,641,526 | 18,600,000 | (4,738,725) | 19,010,242 | 63,683,267 | 174,407,408 |
Total comprehensive income for the nine months period ended September 30, 2022 | ||||||||||
Profit after taxation for the nine months period ended September 30, 2022 | - | - | - | - | - | - | - | - | 19,852,425 | 19,852,425 |
Other comprehensive loss - net of tax | - | - | - | 838,146 | - | - | (9,540,963) | (168,265) | 164,273 | (8,706,809) |
- | - | - | 838,146 | - | - | (9,540,963) | (168,265) | 20,016,698 | 11,145,616 | |
Transfer to statutory reserve | - | - | - | - | 1,985,243 | - | - | - | (1,985,243) | - |
Transfer in respect of incremental depreciation from surplus on revaluation of | - | - | - | - | (57,025) | 57,025 | - | |||
fixed assets to unappropriated profit - net of tax | - | - | - | |||||||
Surplus realized on disposal of non-banking assets - net of tax | - | - | - | - | - | - | - | (13,956) | 13,956 | - |
Transactions with owners, recorded directly in equity | ||||||||||
Final cash dividend at Rs. 5.0 per share - December 31, 2021 | - | - | - | - | - | - | - | - | (5,925,300) | (5,925,300) |
Interim cash dividend at Rs. 5.0 per share - March 31, 2022 | - | - | - | - | - | - | - | - | (5,925,300) | (5,925,300) |
Interim cash dividend at Rs. 4.0 per share - June 30, 2022 | - | - | - | - | - | - | - | - | (4,740,240) | (4,740,240) |
- | - | - | - | - | - | - | - | (16,590,840) | (16,590,840) | |
Balance as at September 30, 2022 (Un-audited) | 11,850,600 | 23,751,114 | 908,317 | 4,539,213 | 39,626,769 | 18,600,000 | (14,279,688) | 18,770,996 | 65,194,863 | 168,962,184 |
Change in equity for three months period ended December 31, 2022 | ||||||||||
Total comprehensive income for the three months period ended December 31, 2022 | ||||||||||
Profit after taxation for the three months period ended December 31, 2022 | - | - | - | - | - | - | - | - | 12,888,510 | 12,888,510 |
Other comprehensive income - net of tax | - | - | - | (136,240) | - | - | (4,802,688) | 18,974,177 | (465,993) | 13,569,256 |
- | - | - | (136,240) | - | - | (4,802,688) | 18,974,177 | 12,422,517 | 26,457,766 | |
Transfer to statutory reserve | - | - | - | - | 1,288,851 | - | - | - | (1,288,851) | - |
Transfer in respect of incremental depreciation from surplus on revaluation of | - | - | - | - | (19,006) | 19,006 | - | |||
fixed assets to unappropriated profit - net of tax | - | - | - | |||||||
Surplus realized on disposal of revalued fixed assets - net of tax | - | - | - | - | - | - | - | (3,140) | 3,140 | - |
Surplus realized on disposal of non-banking assets - net of tax | - | - | - | - | - | - | - | - | - | - |
Transactions with owners, recorded directly in equity | ||||||||||
Interim cash dividend at Rs. 5.0 per share - September 30, 2022 | - | - | - | - | - | - | - | - | (5,925,300) | (5,925,300) |
Balance as at December 31, 2022 (Audited) | 11,850,600 | 23,751,114 | 908,317 | 4,402,973 | 40,915,620 | 18,600,000 | (19,082,376) | 37,723,027 | 70,425,375 | 189,494,650 |
Total comprehensive income for the nine months period ended September 30, 2023 | ||||||||||
Profit after taxation for the nine months period ended September 30, 2023 | - | - | - | - | - | - | - | - | 44,146,596 | 44,146,596 |
Other comprehensive income - net of tax | - | - | - | 4,850,949 | - | - | (2,074,486) | (511,693) | 292,162 | 2,556,932 |
- | - | - | 4,850,949 | - | - | (2,074,486) | (511,693) | 44,438,758 | 46,703,528 | |
Transfer to statutory reserve | - | - | - | - | 4,414,660 | - | - | - | (4,414,660) | - |
Transfer in respect of incremental depreciation from surplus on revaluation of | ||||||||||
fixed assets to unappropriated profit - net of tax | - | - | - | - | - | - | - | (113,396) | 113,396 | - |
Surplus realized on disposal of revalued fixed assets - net of tax | - | - | - | - | - | - | - | (1,097,114) | 1,097,114 | - |
Surplus realized on disposal of non-banking assets - net of tax | - | - | - | - | - | - | - | (24,630) | 24,630 | - |
Transactions with owners, recorded directly in equity | ||||||||||
Final cash dividend at Rs. 6.0 per share - December 31, 2022 | - | - | - | - | - | - | - | - | (7,110,360) | (7,110,360) |
Interim cash dividend at Rs. 6.0 per share - March 31, 2023 | - | - | - | - | - | - | - | - | (7,110,360) | (7,110,360) |
Interim cash dividend at Rs. 7.0 per share - June 30, 2023 | - | - | - | - | - | - | - | - | (8,295,420) | (8,295,420) |
- | - | - | - | - | - | - | - | (22,516,140) | (22,516,140) | |
Balance as at September 30, 2023 (Un-audited) | 11,850,600 | 23,751,114 | 908,317 | 9,253,922 | 45,330,280 | 18,600,000 | (21,156,862) | 35,976,194 | 89,168,473 | 213,682,038 |
For details of dividend declaration and appropriations, please refer note 39 to these unconsolidated condensed interim financial statements.
For details of reserves, please refer note 21 to these unconsolidated condensed interim financial statements.
The annexed notes 1 to 41 form an integral part of these unconsolidated condensed interim financial statements.
For The Nine Months Period Ended September 30, 2023 | Unconsolidated Condensed Interim Statement of |
Changes In Equity (Un-audited) |
13
Unconsolidated Condensed Interim Cash Flow Statement (Un-audited)
For The Nine Months Period Ended September 30, 2023
Nine Months Ended | |||
Note | January 01 | January 01 | |
to | to | ||
September 30, | September 30, | ||
2023 | 2022 | ||
----------Rupees in '000-------- | |||
CASH FLOW FROM OPERATING ACTIVITIES | |||
Profit before taxation | 88,095,465 | 51,587,085 | |
Less: Dividend income | (2,011,486) | (1,687,272) | |
Adjustments: | 86,083,979 | 49,899,813 | |
30 | |||
Depreciation on fixed assets | 2,128,469 | 1,728,068 | |
Depreciation on right-of-use assets | 30 | 1,007,718 | 965,761 |
Depreciation on non-banking assets acquired in satisfaction of claims | 30 | 17,909 | 17,736 |
Amortization | 30 | 266,736 | 296,586 |
Provisions / (reversals) and write offs - net | 32 | 1,236,364 | (1,317,754) |
Gain on sale of fixed assets - net | 29 | (81,231) | (48,172) |
Loss / (gain) on sale of non-banking assets acquired in satisfaction of claims | 29 | 3,224 | (6,817) |
Finance charges on lease liability against right-of-use assets | 26 | 845,092 | 798,608 |
Workers Welfare Fund | 1,761,909 | 1,031,742 | |
Charge for defined benefit plans - net | 29 | 222,196 | 143,859 |
Gain on termination of lease liability against right of use assets | (43,217) | (49,871) | |
Unrealized loss on revaluation of investments classified as held for trading | 28 | 5,654 | 884 |
7,370,823 | 3,560,630 | ||
Decrease / (increase) in operating assets | 93,454,802 | 53,460,443 | |
Lendings to financial institutions | (41,107,626) | (19,934,087) | |
Held-for-trading securities | (164,989) | (1,302,158) | |
Advances | 152,950,821 | 9,690,473 | |
Others assets (excluding advance taxation) | (37,627,862) | (20,752,864) | |
Increase / (decrease) in operating liabilities | 74,050,344 | (32,298,636) | |
Bills Payable | (29,070,739) | (14,153,519) | |
Borrowings from financial institutions | (50,407,583) | (84,387,229) | |
Deposits | 336,948,974 | 177,937,260 | |
Other liabilities (excluding current taxation) | 4,864,280 | 14,836,960 | |
262,334,932 | 94,233,472 | ||
Defined benefits paid | (203,890) | (177,211) | |
Income tax paid | (38,998,484) | (19,271,719) | |
Net cash flow generated from operating activities | 390,637,704 | 95,946,349 | |
CASH FLOW FROM INVESTING ACTIVITIES | |||
Net investment in available-for-sale securities | (287,661,972) | (65,785,504) | |
Net investment in held-to-maturity securities | (222,982) | (3,224,066) | |
Dividends received | 1,957,251 | 1,629,504 | |
Investments in fixed assets | (4,907,760) | (3,029,869) | |
Investments in intangible assets | (267,801) | (159,449) | |
Proceeds from sale of fixed assets | 1,826,859 | 73,710 | |
Proceeds from sale of non-banking assets acquired in satisfaction of claims | 132,000 | 153,500 | |
Investment in subsidiary | (649,925) | (4,000,000) | |
Effect of translation of net investment in foreign branches | 4,850,949 | 838,146 | |
Net cash flow used in investing activities | (284,943,381) | (73,504,028) | |
CASH FLOW FROM FINANCING ACTIVITIES | |||
Payment of lease liability against right-of-use-assets | (1,570,674) | (1,358,396) | |
Dividend paid | (22,874,084) | (16,224,360) | |
Net cash flow used in financing activities | (24,444,758) | (17,582,756) | |
Effects of exchange rate changes on cash and cash equivalents | 11,029,512 | 9,559,736 | |
Increase in cash and cash equivalents | 92,279,077 | 14,419,301 | |
Cash and cash equivalents at beginning of the period | 109,397,829 | 172,223,635 | |
Cash and cash equivalents at end of the period | 201,676,906 | 186,642,936 |
The annexed notes 1 to 41 form an integral part of these unconsolidated condensed interim financial statements.
Shoaib Mumtaz | Hammad Khalid | Mian Umer Mansha | Shahzad Hussain | Muhammad Ali Zeb |
President / CEO | Chief Financial Officer | Director | Director | Director |
Notes To The Unconsolidated Condensed Interim Financial Statements (Un-audited)
For The Nine Months Period Ended September 30, 2023
-
STATUS AND NATURE OF BUSINESS
MCB Bank Limited (the 'Bank') is a banking company incorporated in Pakistan and is engaged in commercial banking and related services. The Bank's ordinary shares are listed on the Pakistan stock exchange. The Bank's Registered Office and Principal Office are situated at MCB -15 Main Gulberg, Lahore. The Bank operates 1,431 branches (2022: 1,439 branches) within Pakistan and 08 branches (2022: 09 branches) outside Pakistan (including the Karachi Export Processing Zone branch). - BASIS OF PREPARATION
- These unconsolidated condensed interim financial statements represent separate financial statements of MCB Bank Limited. The consolidated condensed interim financial statements of the Group are being issued separately.
- In accordance with the directives of the Federal Government regarding the shifting of the banking system to Islamic modes, the State Bank of Pakistan has issued various circulars from time to time. Permissible forms of trade-related modes of financing include purchase of goods by banks from their customers and immediate resale to them at appropriate profit in price on deferred payment basis. The purchases and sales arising under these arrangements are not reflected in these unconsolidated condensed interim financial statements as such but are restricted to the amount of facility actually utilized and the appropriate portion of profit thereon.
- The unconsolidated condensed interim financial statements are presented in Pak Rupees, which is the Bank's functional and presentation currency of its primary economic environment. The amounts are rounded off to the nearest thousand.
- These unconsolidated condensed interim financial statements have been prepared under the historical cost convention except that certain classes of fixed assets and non-banking assets acquired in satisfaction of claims are stated at revalued amounts and certain investments and derivative financial instruments have been marked to market and are carried at fair value. In addition, obligations in respect of staff retirement benefits and lease liabilities which have been carried at present value and right of use assets which are initially measured at an amount equal to the corresponding lease liability and depreciated over the respective lease terms.
3. STATEMENT OF COMPLIANCE
3.1 These unconsolidated condensed interim financial statements have been prepared in accordance with the accounting and reporting standards as applicable in Pakistan for interim financial reporting. The accounting and reporting standards as applicable in Pakistan for interim financial reporting comprise of:
- International Accounting Standard (IAS) 34, Interim Financial Reporting, issued by the International Accounting Standards Board (IASB) as notified under the Companies Act, 2017;
- Islamic Financial Accounting Standards (IFAS) issued by the Institute of Chartered Accountants of Pakistan as are notified under the Companies Act, 2017;
- Provisions of and directives issued under the Banking Companies Ordinance, 1962 and the Companies Act, 2017; and
- Directives issued by the State Bank of Pakistan (SBP) and the Securities and Exchange Commission of Pakistan (SECP).
Whenever the requirements of the Banking Companies Ordinance, 1962, the Companies Act, 2017 or the directives issued by the SBP and the SECP differ with the requirements of IAS 34 or IFAS, the requirements of the Banking Companies Ordinance, 1962, the Companies Act, 2017 and the said directives, shall prevail.
- The State Bank of Pakistan has deferred the applicability of International Accounting Standards 40, 'Investment Property' for Banking Companies through BSD Circular No. 10 dated August 26, 2002 and International Accounting Standard 39 'Financial Instruments: Recognition and Measurement' (IAS 39) through BSD Circular Letter No. 10, dated August 26, 2002. The Securities and Exchange Commission of Pakistan (SECP) has deferred applicability of IFRS-7 "Financial Instruments: Disclosures" on banks through S.R.O 411(1) /2008 dated April 28, 2008. Accordingly, the requirements of these standards have not been considered in the preparation of these unconsolidated financial statements. However, investments have been classified and valued in accordance with the requirements prescribed by the State Bank of Pakistan through various circulars.
- The SECP vide its notification SRO 633 (I)/2014 dated July 10, 2014, adopted IFRS 10 effective from the periods starting from June 30, 2014. However, vide its notification SRO 56 (I)/2016 dated January 28, 2016, it has been notified that the requirements of IFRS 10 and section 228 of the Companies Act, 2017 will not be applicable with respect to the investment in mutual funds established under trust structure.
- The disclosures made in these unconsolidated condensed interim financial statements have been limited based on a format prescribed by the SBP vide BPRD Circular Letter No. 05 of 2019 dated March 22, 2019 and IAS 34, Interim Financial Reporting. These unconsolidated condensed interim financial statements do not include all the information and disclosures required in the audited annual financial statements, and should be read in conjunction with the audited annual unconsolidated financial statements for the financial year ended December 31, 2022.
15
| Attention: This is an excerpt of the original content. To continue reading it, access the original document here. |
Attachments
- Original Link
- Original Document
- Permalink
Disclaimer
MCB Bank Ltd. published this content on 27 October 2023 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 27 October 2023 11:16:38 UTC.
