The National Bank of Pakistan (PSX: NBP) has announced its consolidated financial results for the quarter ending March 31, 2025, marking a significant surge in profitability and a robust start to the calendar year. NBP posted a profit after tax of Rs22.11 billion, reflecting an impressive 125.14% increase year-on-year (YoY) compared to Rs9.82 billion in the same quarter of 2024. Earnings per share (EPS) jumped from Rs4.56 to Rs10.29, highlighting the bank’s strong earnings momentum and strategic growth initiatives.
The substantial increase in net profitability was driven primarily by a 139.47% YoY rise in net mark-up/interest income, which totaled Rs69.75 billion in the first quarter of 2025, up from Rs29.13 billion in the corresponding period last year. This significant improvement came despite a 22.48% YoY decline in interest income earned, suggesting improved efficiency in managing liabilities and interest expenses, which fell by 41.65% year-on-year.
While core income growth was stellar, non-mark-up/interest income declined by 7.67% YoY to Rs26.89 billion. The dip was largely due to the absence of last year’s gains from derivatives and lower other income. Notably, the bank posted a net loss of Rs100.42 million from derivatives and a Rs327.81 million loss on securities during the quarter.
Despite the downturn in some non-core areas, fee and commission income surged by 46.65% to Rs9.21 billion, indicating continued strength in the bank’s retail and transaction banking businesses. Foreign exchange income also rose 13.04% YoY to Rs2 billion, providing further diversification to revenue streams. Dividend income remained relatively stable at Rs1.75 billion, with only a minor 1.08% decline from the previous year.
One of the standout performances came from NBP’s investments in associates, where profit contributions soared by 458.46% YoY to Rs394.45 million. However, earnings from joint ventures decreased by 39.61% to Rs22.65 million.
On the expense side, non-mark-up/interest expenses increased by 29.97% YoY to Rs29.22 billion, mainly on account of higher operating costs which rose to Rs29.20 billion from Rs22.47 billion last year. Meanwhile, credit loss allowances and write-offs saw a steep rise of 778.88%, totaling Rs6.39 billion, indicating a more cautious approach in provisioning amid economic uncertainty.
NBP’s profit before taxation stood at Rs47.09 billion, reflecting a 130.52% YoY increase. However, taxation costs nearly doubled, rising by 135.5% YoY to Rs24.98 billion, aligning with changes in sector-wide tax regulations. After accounting for taxation, the profit attributable to equity holders of the bank stood at Rs21.88 billion, while Rs221.44 million was attributable to non-controlling interests.
The overall performance reinforces NBP’s strong financial foundation and its ability to generate value in a complex economic landscape. The significant boost in net interest margins, paired with stable fee income and prudent cost management, positions the bank well for sustained profitability through the rest of the year.
NBP’s first quarter results underscore the positive impact of its strategic realignments and capital discipline. As the bank navigates a challenging yet opportunity-rich environment, continued focus on core banking, digital transformation, and regional expansion are expected to be key drivers of future performance. The surge in profitability also signals growing investor confidence in the bank’s direction, as NBP strengthens its position among Pakistan’s leading financial institutions.