National Bank of Pakistan (NBP) is set to deliver a major reward to its shareholders, with management indicating plans to significantly increase dividend payouts following a surge in profitability and strong capital buffers. The development was shared during the bank’s Analysts’ Meet & Greet session, where executives outlined the financial strategy to avoid overcapitalization and maintain optimal return on equity (ROE).
The bank is expected to reintroduce a traditionally generous dividend policy, echoing its payout ratios of 70–80% maintained during 2011–2016. This renewed approach reinforces NBP’s long-standing commitment to rewarding investors while sustaining operational strength. In 2024, the bank declared Rs 8 per share in dividends, representing an 80% payout ratio. Analysts initially projected a 50% payout this year, but expectations have now risen sharply following the bank’s exceptional performance in 2025.
As per the NBP Act, dividends can only be announced alongside year-end results, with final approval resting with the Board of Directors. Management emphasized that the bank’s strong financial health and capital adequacy provide substantial flexibility for shareholder distributions without compromising regulatory requirements.
NBP’s financial results for the first half of 2025 underscore this confidence. Total assets rose 7.1% year-to-date to Rs 7.2 trillion, while profit after tax surged to Rs 43.5 billion — a staggering 12,028% increase year-on-year. Earnings per share reached Rs 20.43, translating to an impressive ROE of 18.6%. The bank’s book value per share now stands at Rs 229, highlighting a solid capital foundation.
The bank’s capital adequacy ratio (CAR) of 27.28% far exceeds the regulatory minimum of 14%, providing a buffer of 1,328 basis points. Its Common Equity Tier 1 (CET-1) ratio stands at 20.14% against the required 13%, offering ample headroom for dividend payments.
Under IFRS-9 accounting standards, NBP recorded Rs 6.9 billion in realized capital gains through Other Comprehensive Income (OCI), which would have lifted post-tax profit to Rs 47 billion if included in the Profit & Loss account, and raised earnings per share to Rs 22.13.
NBP’s deposit base also exhibited strong growth, reaching Rs 4.7 trillion — a 21.7% increase year-to-date. The Current Account and Savings Account (CASA) ratio improved to 83%, reflecting the bank’s healthy funding mix and strong retail presence. With an estimated 13% market share of total deposits, NBP continues to be a major player in Pakistan’s financial sector.
On the lending side, the bank’s Rs 1.58 trillion gross advances portfolio remains well-diversified, with corporate loans comprising 42%, consumer 13%, agriculture 8%, and SME/commercial segments 8%. NBP maintains its leadership as the country’s largest agriculture lender, with Rs 120 billion in outstanding loans. Notably, 43% of the agriculture portfolio — approximately Rs 52 billion — is secured against gold, minimizing credit risk.
NBP’s Rs 5 trillion investment book remains concentrated in government securities, with floating-rate Pakistan Investment Bonds (PIBs) making up 53% of holdings. The portfolio’s average maturity of 2.74 years and a yield of 13.9% provide a strong earnings base. A revaluation surplus of Rs 145 billion further supports the bank’s balance sheet strength.
The bank’s digital transformation is also progressing rapidly. In the first half of 2025, NBP invested Rs 2 billion in technology upgrades, including systems modernization, ATM expansion, and software enhancements. The number of registered users on its mobile banking platform has grown to 2.1 million, underscoring strong adoption of digital services.
A key milestone this year was the successful rollout of NBP’s upgraded core banking system in May 2025, now supporting both conventional and Islamic banking operations. This move has enhanced customer experience and streamlined operations across its network of 1,503 branches and 1,500 ATMs serving over 9 million customers nationwide.
NBP’s share price has surged by an impressive 135% over the past year, outperforming the KSE-100 index, which gained 28% in the same period. Despite this rally, the stock remains attractively valued at a price-to-book ratio of 0.5x, presenting further upside potential.
Crossing the $1 billion market capitalization milestone marks a new chapter for the bank as it consolidates its position among Pakistan’s most valuable financial institutions. With a strong capital base, expanding digital footprint, and renewed focus on shareholder returns, NBP is well-positioned to sustain growth momentum and deliver long-term value.
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