SBP imposes fine of Rs 134.61 million on JS Bank
The State Bank of Pakistan (SBP) has imposed a
penalty of Rs 134.61 million on JS Bank Limited for the calendar year 2024.
This penalty represents a notable increase from
the Rs 81.48 million fine imposed in the previous year, as per JS Bank’s annual
financial statement for 2024.
For the year ending December 31, 2024, JS Bank
reported a Profit Before Tax of PKR 6,366.077 million, a decrease from PKR
8,515.174 million in 2023. The Earnings Per Share (EPS) for 2024 stood at PKR
1.39, down from PKR 2.75 in the prior year.
Despite the regulatory fine, JS Bank saw strong
growth in its Net Interest Income (NII), which rose by 22 percent to PKR 27,313
million in 2024 from PKR 22,409 million in 2023. This growth was largely driven
by higher interest rates and optimized deposit strategies. The Bank’s
Non-Remunerative Deposit base also grew by 24 percent, increasing from PKR
160,546 million in 2023 to PKR 198,409 million in 2024, improving its deposit
mix from 33 percent to 38 percent.
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JS Bank's Gross Advances grew by 16 percent,
reaching PKR 247,714 million as it worked toward meeting its year-end Advances
to Deposits Ratio (ADR) target while adjusting to additional ADR tax measures.
However, the Bank's margins faced pressure due to fluctuating secondary market
yields and stable funding costs during the first half of the year.
In the latter part of the year, despite rate
cuts, JS Bank continued to face lower market yields. Its Non-Markup Income
declined slightly by 7 percent year-on-year, totaling PKR 11,340 million.
However, this included an 18 percent increase in Fee Income and a 32 percent
rise in Dividend Income, along with net gains on securities amounting to PKR
641 million. Foreign Exchange income saw a significant decline of PKR 2,467 million,
attributed to reduced volatility in the FX markets compared to the previous
year.
JS Bank’s Non-Markup Expenses rose by 18
percent year-on-year, totaling PKR 27,574 million. This increase was driven by
inflationary pressures, rupee depreciation, and higher technology-related
expenditures. As a result, the Bank's Cost to Income Ratio climbed to 70.7
percent in 2024, while its Net Interest Income to Operating Cost ratio improved
from 97 percent to 100 percent.
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By December 31, 2024, JS Bank’s total deposits
had grown by 8 percent, reaching PKR 525.134 billion. The Bank’s average
Non-Remunerative Deposits improved from PKR 143.916 billion in 2023 to PKR
165.927 billion in 2024, reinforcing its strategy to enhance the deposit mix.
The Bank’s Gross Advances reached PKR 247.714
billion by the end of 2024, pushing the Gross ADR to 47 percent. However, the
Gross Infection Ratio increased to 8.61 percent from 7.6 percent in 2023, as
non-performing loans rose to PKR 21.328 billion in December 2024 from PKR 16.184
billion in the previous year.
After
additional classifications and provisions under IFRS 9, JS Bank improved its
coverage ratio to 71 percent in 2024, up from 60 percent in 2023. As it
continues its growth trajectory, JS Bank remains focused on mitigating financial
risks while optimizing operational efficiencies.
Source: https://pkrevenue.com/