ABL strengthens position via risk management, strategic capital allocation and diversification

KARACHI: Allied Bank continues to strengthen its competitive position through prudent risk management, strategic capital allocation, and diversification across investment and lending portfolios. Its steadfast commitment to operational excellence and digital transformation has not only elevated the customer experience but also reinforced the foundation for sustainable, long-term growth. Allied Bank’s net markup and interest income reached Rs. 105,000 million during the year ended December 31, 2025 as compared to Rs. 115,223 million during last year, decreasing by Rs. 10,223 million or 9 percent. The Bank recorded markup up/ interest income of Rs. 297,228 million for the year ended December 31, 2025, compared to Rs. 376,760 million in 2024, reflecting a year-on-year decrease of 21 percent. This decline primarily stems from lower average policy rate of 11.39 percent in 2025 as compared to 19.67percent in 2024. Conversely, Markup or interest expense of the Bank has decreased by Rs. 69,309 million or 27 percent to reach Rs. 192,228 million for the year ended December 31, 2025 as compared to Rs. 261,537 million for the year ended December 31, 2024. This decrease is on account of lower cost of deposits and borrowing expense, partially offset by higher interest expense on right of use asset. Fee income stood at Rs. 16,516 million for the year ended December 31, 2025, compared to Rs. 14,081 million for the corresponding year; registering increase of Rs. 2,434 million or 17 percent, mainly on account of higher card related fee, card acquiring business, investment banking fee, branch banking customer fee, partially offset by lower commission on remittances. Dividend income of the Bank stood at Rs. 2,903 million for the year ended December 31, 2025 as compared to Rs. 3,018 million for the year ended December 31, 2024, lower by 4 percent. Capital gain of the Bank for the year under review was Rs. 2,920 million, lower by 15 percent, compared to Rs. 3,444 million for the year ended December 31, 2024 mainly due to lower gain on sale of Federal government securities, partially offset by higher gain on Euro Bonds. Foreign Exchange income of ABL stood at Rs. 5,145 million for the year ended December 31, 2025, against Rs. 6,679 million for last year, lower by 23precent. The Bank’s other income amounted to Rs. 1,073 million in 2025, compared to Rs. 758 million in 2024, representing a 42 year on year increase. Cumulatively, non-markup or non-interest income of the Bank stood at Rs. 28,556 million for the year ended December 31, 2025, reflecting a 2 percent growth from Rs. 27,980 million in the corresponding year. Allied Bank’s continued focus on expanding its branch network and strengthening technological capabilities led to an increase in total operating expenses during the year. However, through effective use of technology, process automation, and operational improvements, the Bank successfully contained the growth in operating expenses to 16 percent. Total operating expenses amounted to Rs. 66,988 million for the year ended December 31, 2025, compared to Rs. 57,985 million for the year ended December 31, 2024. For the year ending December 31, 2025, profit before taxation stood at Rs. 74,209 million, reflecting a 16 percent decrease from Rs. 87,928 million in the corresponding year ended December 31, 2024. The effective income tax rate for the year ended December 31, 2025, was 52.60 percent, compared to 50.96 percent for the previous year. The tax charge for 2025 stood at Rs. 39,034 million, lower than Rs. 44,812 million in 2024, reflecting a 13 percent decrease. The Bank’s profit after tax stood at Rs. 35,175 million for the year ended December 31, 2025, down from Rs. 43,116 million in the corresponding year of 2024. The Bank has declared Rs. 16.00 dividend for the year ended December 31, 2025. Total deposits were Rs. 2,345,859 million as of December 31, 2025, compared to Rs. 2,018,395 million as of December 31, 2024, reflecting a growth of 16 percent. The Bank’s continued focus on enhancing low cost or no cost deposits resulted in an increase of 21 percent growth in current account deposits. Gross advances of the Bank were recorded at Rs. 802,076 million as of December 31, 2025, compared to Rs. 1,066,348 million as of December 31, 2024. Similarly, Net advances of ABL were Rs. 789,677 million as of December 31, 2025, compared to Rs. 1,051,314 million as of December 31, 2024; thereby, declining by 25 percent. Allied Bank continues to maintain a consistently low infection ratio, reflecting the strong quality and resilience of its credit portfolio. As of December 31, 2025, the Bank’s infection ratio stood at 1.42 percent, as compared to 1.22 percent in the previous year. The overall coverage ratio was recorded at 109.1 percent as of December 31, 2025, compared to 115.7 percent as of December 31, 2024. Bank’s total investments stood at Rs. 2,137,087 million as of December 31, 2025, compared to Rs. 1,129,874 million for the year ended December 31, 2024, depicting a robust growth of 89 percent. Allied Bank achieved a significant milestone by surpassing an asset base of Rs. 3 trillion. The Bank’s total assets stood at Rs. 3,370,395 million as of December 31, 2025, reflecting a robust growth of 20 percent from Rs. 2,816,969 million at the end of previous year. The Bank’s net assets increased by 13 percent, reaching Rs. 263,376 million as of December 31, 2025, compared to Rs. 233,901 million in 2024. The Return on Assets (ROA) and Return on Equity (ROE) Tier 1 of the Bank recorded at 1.1 percent and 18.7 percent, respectively, as of December 31, 2025, compared to 1.7 percent and 26.0 percent in the previous year. The Capital Adequacy Ratio (CAR) stood at 27.74 percent as of December 31, 2025, up from 26.71 percent in 2024, remaining well above the minimum regularity threshold of 11.5 percent. Copyright Business Recorder, 2026

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