KARACHI: Earnings estimates for United Bank Limited (UBL), Habib Bank Limited (HBL) and Bank Alfalah Limited (BAFL) have been revised upward by 11–30 percent for 2026 and 2027, following stronger-than-expected balance sheet growth and higher non-funded income across the banking sector.
The upward revisions reflect improved deposit growth, higher capital gains and foreign exchange (FX) income, as well as recent quarterly results and the outlook for interest rates. Banks have reported stronger-than-expected balance sheet expansion, while non-funded income has exceeded earlier estimates, primarily due to gains from investments and foreign exchange transactions, according to a banking sector assessment by Topline Research.
UBL’s earnings estimates have been raised by 13–17 percent to Rs59.5 per share for 2026 and Rs62.6 per share for 2027. The bank is expected to record deposit growth of 32 percent in 2026, following exceptionally strong growth of 96 percent in 2025.
Its current account mix improved to 55.9 percent in September 2026 from 49.9 percent in December 2025. Higher current account deposits and growth in non-funded income, excluding capital gains, are expected to remain the key drivers of earnings growth.
At its last closing price of Rs425 per share, UBL was trading at 6.8 times its estimated 2027 price-to-earnings (P/E) ratio and 1.8 times its price-to-book (P/B) value, with a dividend yield of 8 percent.
For HBL, earnings estimates have been upgraded by 11–15 percent to Rs49.9 per share for 2026 and Rs51.7 per share for 2027, mainly due to an improving deposit mix and higher non-funded income.
HBL’s non-funded income is expected to grow 12 percent year-on-year to Rs96 billion in 2026, driven largely by higher fee and commission income and foreign exchange earnings. FX income is projected to nearly double to Rs16 billion during the year.
However, some moderation in non-funded income growth is expected in 2027, mainly due to lower capital gains.
At its last closing price of Rs300 per share, HBL was trading at 5.8 times its estimated 2027 P/E ratio and 0.8 times its P/B value, with a dividend yield of 8 percent.
BAFL recorded the largest upward revision among the three banks, with its earnings estimates raised by 24–30 percent to Rs12 per share for 2026 and Rs11.6 per share for 2027.
The revision reflects stronger average current account growth, higher FX income and improved treasury management. The bank is also expected to maintain cost discipline, with its cost-to-income ratio projected to decline to 62 percent in 2026 from 64 percent in 2025.
Higher FX income is another key contributor to the improved earnings outlook, supported by BAFL’s presence in trade-related and foreign exchange transactions.
At its last closing price of Rs59 per share, BAFL was trading at 5.1 times its estimated 2027 P/E ratio and 0.9 times its P/B value, with a dividend yield of 10 percent.
Copyright Business Recorder, 2026
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