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Result Preview: MCB CY14


MCB - Pakistan

MCB Bank Ltd is scheduled to hold its board meeting on Thursday February 12, 2015. Our expectations for unconsolidated accounts of MCB are as follows.
Double digit earnings growth likely seen
We expect MCB earnings to sure by 12% to Rs 24.14 billion (EPS: Rs 21.69) compared to Rs 21.49 billion (EPS: Rs 19.31) in CY13. Higher net interest income, hike in non interest income and reversal of provisions likely drivers of the banks. Similarly, double digit growth of 40% YoY is expected in 4QCY14 where earning to escalate at Rs 6.02 billion (EPS: Rs 5.41) from Rs 4.31 billion (EPS: Rs 3.87) in 4QCY13. The Bank is also expected to announce a final cash dividend of Rs 3.5/share, taking the total cash dividend of Rs 13.5/share for CY14. Furthermore, possibility of 10% bonus share cannot be rule out.
Higher NII is expected
Net interest income (NII) likely to surge by 12% to Rs 42.40 billion versus Rs 37.86 billion in CY13 due to growth in earnings assets and higher yields on longer tenor’s assets expected. Interest income to surge by 17% to Rs 75.90 compared to Rs 65.06 billion in CY13 mainly due to better yields. Conversely, Interest expense is expected to swell by 23% to Rs 33.50 billion in CY14 against Rs 27.19 billion in CY13 owing to increase in saving rate.

Non- funded income & reversal of provisions likely to further support
Non-interest income is expected to hike by 20% to Rs 13.43 billion against Rs 11.17 billion in CY13 due to likely increases in Income from dealing in foreign currencies and fee, commission & brokerage income. Similarly, reversal of provisions is expected at Rs 1.71
billion owing to lower speed of accretions and better coverage of bad loans during the period.


Result Preview – MCB CY14

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