Meezan Bank Limited reported a 3.18% increase in its consolidated profit after taxation for the six months ended June 30, 2026, with earnings reaching Rs48.64 billion compared with Rs47.14 billion during the corresponding period of the previous year. The latest financial results show that the bank maintained positive bottom-line growth despite higher operating expenses and a modest decline in profit before taxation. Basic earnings per share increased to Rs26.71 from Rs25.97 in the first half of the previous financial year, representing growth of approximately 2.85%, while diluted earnings per share rose to Rs26.54 from Rs25.81. Alongside the financial results, the Board of Directors declared an interim cash dividend of Rs8 per share, equivalent to 80%, for the half year ended June 30, 2026. The latest dividend comes in addition to the Rs7.50 per share, or 75%, interim dividend that had already been paid, taking the total interim dividend declared for the period to Rs15.50 per share.
The bank’s total income increased by 6.13% year on year to Rs153.02 billion during the first half of 2026, compared with Rs144.18 billion in the same period last year. Profit or return earned on Islamic financing and related assets, investments and placements increased by 6.34% to Rs222.82 billion from Rs209.54 billion. At the same time, profit or return on deposits and other dues expensed increased at a faster rate of 12.21%, reaching Rs94.03 billion from Rs83.79 billion. As a result, net profit or return increased by a more modest 2.43% to Rs128.80 billion compared with Rs125.74 billion previously. The bank received a stronger contribution from other income during the period, which increased by 31.36% to Rs24.22 billion from Rs18.44 billion. Fee and commission income rose 27.22% to Rs17.84 billion, while foreign exchange income recorded a 56.42% increase to Rs4.33 billion. Gains on securities also increased by 52.01% to Rs1.02 billion, while dividend income climbed 47.38% to Rs255.28 million. Other income was the only major component within this category to decline, falling 3.52% to Rs775.75 million.
The improvement in income was partly offset by a substantial increase in expenses during the six-month period. Operating expenses increased by 29.71% to Rs45.28 billion from Rs34.91 billion in the corresponding period last year, making higher operating costs one of the main pressures on the bank’s earnings. Workers’ Welfare Fund expenses declined slightly by 3.43% to Rs2.14 billion from Rs2.22 billion, while other charges fell sharply by 96.41% to Rs2.26 million compared with Rs62.88 million previously. Despite these reductions, total other expenses increased by 27.52% to Rs47.42 billion from Rs37.19 billion. As a result, the profit subtotal before the contribution from associates and provisions declined by 1.31% to Rs105.60 billion from Rs106.99 billion. The share of profit from associates also decreased significantly by 63.19%, falling to Rs261.82 million from Rs711.21 million. Consequently, profit before credit loss allowance and provisions declined 1.71% to Rs105.86 billion from Rs107.71 billion.
Credit-related charges provided some relief during the reporting period, with credit loss allowance, provisions and write-offs on a net basis declining by 22.94% to Rs2.60 billion from Rs3.38 billion a year earlier. Despite the lower provision expense, profit before taxation remained slightly below the previous year’s level, easing by 1.03% to Rs103.26 billion from Rs104.33 billion. The decline in taxation, however, provided an important cushion for the final earnings figure. Meezan Bank’s taxation expense decreased by 4.50% to Rs54.61 billion from Rs57.19 billion during the corresponding period. The reduction in tax expense was proportionally greater than the decline in pre-tax profit, allowing the bank to record an increase in profit after taxation despite the pressure on earnings before tax. This resulted in the 3.18% increase in consolidated profit after taxation to Rs48.64 billion. The movement also lifted basic and diluted earnings per share, with basic EPS increasing 2.85% and diluted EPS rising 2.83% compared with the first half of the previous financial year.
The first-half results present a mixed financial picture for Meezan Bank, with stronger income generation and a substantial increase in other income supporting the bank’s bottom line, while rising operating expenses and lower associate earnings weighed on profitability before taxation. The 31.36% increase in total other income was particularly significant, supported by higher fee and commission income, foreign exchange income, gains on securities and dividend income. Meanwhile, the 22.94% reduction in credit loss allowance and provisions helped limit the impact of higher expenses on pre-tax earnings. The decline in taxation ultimately provided the final support for the year-on-year increase in profit after taxation. With the Board declaring another Rs8 per share interim cash dividend on top of the Rs7.50 per share already paid, Meezan Bank has maintained a substantial shareholder distribution alongside its first-half earnings performance. The results underline continued growth in the bank’s income base while also highlighting the pressure created by rising operating costs during the six-month period ended June 30, 2026.
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