Faysal Bank Limited (PSX: FABL) has reported a net profit of Rs22.47 billion for the year ended December 31, 2025, reflecting a 6% decline compared to Rs23.89bn recorded in the previous year. The bank’s earnings per share stood at Rs14.80, down from Rs15.74 in the corresponding period, while the board declared a dividend of Rs2 per share, maintaining shareholder payouts despite margin compression.
The bank’s profit or return earned dropped 26% year-on-year to Rs165.99bn, compared with Rs225.16bn in 2024. At the same time, profit or return expensed declined 33% to Rs96.30bn from Rs144.6bn, resulting in a net profit or return of Rs69.69bn, down 13% from Rs80.56bn last year. The reduction in both earned and expensed returns reflects the shifting interest rate environment and balance sheet adjustments across the banking sector.
Despite pressure on core spread income, non-interest income provided a substantial cushion. Total other income rose 65% to Rs32.37bn from Rs19.62bn a year earlier. Within this segment, fee and commission income increased 23% to Rs15.76bn from Rs12.82bn, indicating solid expansion in transaction-based and service-driven revenues. Dividend income grew 32% to Rs493.8 million from Rs375.5m, while foreign exchange income surged 48% to Rs7.91bn from Rs5.34bn, emerging as a major contributor to non-markup income growth.
A notable boost came from gains on securities, which climbed sharply by 684% to Rs8.17bn compared to Rs1.04bn in the previous year. Income from derivatives recorded a modest gain of Rs1,056 against a loss of Rs146,211 last year. However, the bank reported a net loss on derecognition of financial assets amounting to Rs330.5m, doubling from Rs165.3m in 2024. Other income edged up 2% to Rs365.3m.
As a result, total income for FY2025 remained broadly stable, rising 2% to Rs102.07bn from Rs100.18bn in FY2024. The marginal growth underscores the balancing effect of robust non-interest income against the contraction in profit earned.
On the expense side, total other expenses increased 15% to Rs58.95bn from Rs51.34bn. Operating expenses were the primary driver, climbing 15% to Rs57.91bn compared with Rs50.21bn in the previous year, reflecting inflationary pressures and continued investment in branch network, technology infrastructure and compliance frameworks. Workers’ Welfare Fund declined 7% to Rs960.1m from Rs1.03bn, while other charges decreased 16% to Rs81.5m from Rs97.2m.
The bank’s share of profit from associates fell 39% to Rs273.5m from Rs447.6m. Profit before credit loss allowance declined 12% to Rs43.39bn from Rs49.29bn. Credit loss allowance and write-offs surged 98% to Rs4.88bn, compared to Rs2.46bn last year, indicating a higher provisioning charge amid evolving asset quality dynamics.
Consequently, profit before taxation stood at Rs48.27bn, down 7% from Rs51.75bn in the corresponding period of 2024. Taxation expense also declined 7% to Rs25.80bn from Rs27.86bn, mirroring the contraction in pre-tax earnings. Profit after taxation closed at Rs22.47bn, marking a 6% year-on-year decrease.
Overall, Faysal Bank’s 2025 financial performance reflects a transition phase where margin compression weighed on core income, but diversified revenue streams, particularly fee-based services, foreign exchange operations and capital market gains, played a pivotal role in stabilizing total income and sustaining profitability.
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