HBL to establish agricultural subsidiary
Habib Bank Limited (HBL), one of Pakistan's
largest banks, has announced its plan to establish a subsidiary aimed at
promoting the country's agriculture sector. The bank disclosed this development
in a notice to the Pakistan Stock Exchange (PSX) on Wednesday.
According to the notice, HBL has finalized a
detailed feasibility report for the subsidiary, which will focus on supporting
and advancing Pakistan's agriculture sector. The bank is currently in the
process of obtaining all necessary regulatory approvals for the incorporation
of the new subsidiary.
In the first quarter of the year, HBL reported
significant growth in its earnings, with a profit before tax (PBT) of Rs21.5
billion, marking a 47% increase compared to the PBT of Rs14.6 billion in the
same period last year. The bank's profit after tax also rose by 54% to Rs13.3 billion,
and earnings per share improved from Rs5.78 in Q1'22 to Rs9.00 in Q1'23.
Meanwhile, Pakistan's agriculture sector,
considered the backbone of the country's economy, experienced a 27.5% growth in
agricultural loans. The agriculture lending financial institutions disbursed
Rs1.222 trillion for agricultural financing during the first nine months
(July-March) of the current fiscal year. The State Bank of Pakistan (SBP) has
set a target of Rs1.819 trillion for agricultural credit disbursement for FY23,
28.2% higher than the previous year.
The outstanding portfolio of agricultural loans
also witnessed a significant increase, reaching Rs712.9 billion at the end of
March 2023, compared to Rs632.7 billion at the end of March 2022, reflecting a
12.7% growth.
Out of the total disbursement of Rs1.222
trillion, the farm sector received Rs625.1 billion (51.2%), while the non-farm
sector was allocated Rs596.8 billion (49%) during the period from July to March
in FY2023.