The Faysal Bank announced its 2005 financial results recently. During the year under review, the Faysal Bank management maintained its strategy of focusing on core, yet high yield banking operations.
The total assets recorded a growth of 40.4 percent as these scaled up to Rs 110.3 billion (2004: Rs 78.5 billion). The total deposits swelled to Rs 74.7 billion (2004: Rs 56.4 billion) reflecting a growth of 32.4 percent. Financing enlarged to Rs 62.3 billion as of December 31, 2005 from Rs 50.5 billion as at end of December 2004.
Lending to financial institutions registered a growth of 143.2 percent as it increased from Rs 4.4 billion as of December 31, 2004 to Rs 10.7 billion at the end of December 2005. The investments climbed up to Rs 24.4 billion as of December 31, 2005 as compared to Rs 12.3 billion on December 31, 2004 (including unrealised revaluation surplus of Rs 5.9 billion as compared to Rs 3.9 billion last year).
In line with augmentation in lending, investments and financing, the total income also rose from Rs 4.6 billion in 2004 to Rs 8.4 billion in 2005, depicting a growth of 83.3 percent although total assets increased by 40.4 percent. The mark-up/return income registered quantum jump of 130.2 percent as it improved from Rs 2.8 billion (in 2004) to Rs 6.3 billion in 2005, while non mark-up income witnessed a modest growth of over 12.7 percent from Rs 1.8 billion to Rs 2.1 billion during 2005.
The relatively higher surge of 196.2 percent in mark-up expense from Rs 1.1 billion to Rs 3.3 billion was due to stiff competition for deposits mobilisation. Administrative expenses were also kept well under control and were contained at Rs 1.4 billion (2004: Rs 1.1 billion).
The rise in non mark-up expenses is mainly attributable to aforesaid volume surge, opening of six new branches and annual salary increases to staff. It also included contribution of Rs 10 million towards the President's Relief Fund and Rs 2.5 million to Waqf Faisal for earthquake relief. Accordingly PBT grew by 79.8 percent (2005: Rs 3.969 billion, 2004: Rs 2.207 billion)
There was overall reversal of provision against investments and financing to the extent of Rs 309 million mainly due to reversal of Rs 338 million upon successful restructuring of financing to Pakland Group.-PR
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