Higher Impairment on Equity Investments led Soneri Bank to post 41% Lower Profit

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Higher Impairment on Equity Investments led Soneri Bank to post 41% Lower Profit

  • Higher Net Interest Income, FX Income raised revenue for the Bank
  • Massive losses in Equity Portfolio and Increase in Bad Loans led Bank to post a decline in Profit

Soneri Bank declared its 1st Quarter 2020 result where it posted a Net Profit of Rs. 407.4 million as compared to Rs. 691 million in the same period last year.

Banks Net Interest Income increased by 5.6%YoY to Rs. 2.108 billion marked by a significant decrease in Interest Margins. In order to book liquidity at Year-End, Soneri Bank had booked high-cost deposits. Moreover, the Bank’s Assets had shorter repricing time which led to a significant decline in Interest Margins for the Bank.

Soneri bank earned hefty FX Income of Rs.402 million amid volatility in the FX Market. On the expenses side, SONERI kept its Operating Expenses in check with only 8% growth YoY. Staff Cost increased by 11% to Rs. 934 million.

Soneri Bank had to book Provisioning Expense of Rs. 150 million while bank also booked an impairment of Rs. 179 million against Equity Investments. Soneri Bank had incurred Impairment of Rs. 715 million. However, due to relaxation by State Bank of Pakistan, it booked the expense of only Rs. 179 million.

Soneri Bank’s Net Profit for 1st Quarter 2020 stood at Rs. 407.46 million as compared to Rs. 691 million in same period last year, marking a decline of 41% YoY.

 

Sana Zeeshan Author
Sana Zeeshan is a frequent contributor to leading News Papers in Pakistan. Her area of Interest Includes Economy, Finance and Investments
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Sana Zeeshan Author
Sana Zeeshan is a frequent contributor to leading News Papers in Pakistan. Her area of Interest Includes Economy, Finance and Investments
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