Soneri Bank posts Rs1.339bn PAT in Q126

KARACHI: The Board of Directors of Soneri Bank Limited, in their 216th meeting held in Karachi on Monday, approved the Bank’s financial statements of the first quarter ended 31 March 2026. The Bank’s stable performance across all functional areas underscores its operational robustness. This was achieved despite the dual challenges of a declining interest rate environment and inflationary trends, alongside the planned capital expenditure for expanding our branch footprint. The Bank posted Profit before tax (PBT) of Rs 2. 795 billion and Profit after tax (PAT) of Rs 1. 339 billion for the period ended 31 March 2026, as compared to Rs. 3. 337 billion and Rs 1. 147 billion respectively for the comparative period. The bottom-line growth resulted in an improved earnings per share of Rs 1. 2146, up from Rs 1. 0406. This reflects a period-on-period growth of 16. 72 percent in shareholder returns. Despite a challenging interest rate environment, the Bank maintained stable overall revenue of Rs 8. 796 billion. While NII declined 17. 96 percent year-on-year to Rs 5. 980 billion, reflecting margin compression, this was offset by an exceptional 80. 17 percent increase in non-interest income of Rs 2. 817 billion. The growth in non-funded streams was driven by a notable increase in foreign exchange income by Rs 432. 107 million and commission-based revenue by Rs 98. 424 million supported by higher net capital gains of Rs 722. 358 million, highlighting the Bank’s effective diversification of its income base. The Bank’s investment portfolio increased to Rs 492. 744 billion by period-end, reflecting a 2. 82 percent growth over the previous year’s position of Rs 479. 247 billion. Average volume of investments for the period also showed an upward trend, rising to Rs 492. 390 billion as compared to prior period of Rs 449. 557 billion. Despite this volume growth, investment income declined to Rs 13. 650 billion as compared to prior period of Rs 15. 959 billion. This contraction was primarily driven by reduction in discount rate triggering a compression in net investment yields, which averaged 11. 24% for the current period as compared to 14. 40 percent in the prior period. In line with the State Bank of Pakistan’s downward policy rate revisions, the Bank’s loan book underwent gradual repricing, leading to a contraction in net yields on advances to 10. 50 percent as compared to 11. 84 percent in prior period. Consequently, total income from advances declined by 6. 55 percent to Rs 5. 611 billion, down from Rs 6. 004 billion in the prior period. This yield-driven compression was partially offset by a steady increase in lending activity, with average net advances growing to Rs 216. 785 billion from Rs 205. 723 billion in the previous period. The Bank’s deposit base stood at Rs 685. 051 billion at period-end, reflecting a marginal contraction of 0. 59 percent over previous year-end. However, the portfolio demonstrated strong momentum in terms of average volumes, which grew by Rs 91. 016 billion or 16. 32 percent compared to the prior period. Notable improvements were seen in the deposit mix, with the CASA ratio strengthening to 86. 99 percent (December 2025: 81. 86pc) and Current Account composition rising to 33. 73 percent (December 2025: 29. 89pc). This shift, supported by a 14. 18 percent growth in average current account volumes over comparative period, contributed to a reduction in the cost of deposits from 7. 69 percent to 6. 44 percent. The Bank remains committed to optimizing its funding mix and rationalizing costs while maintaining premium service standards. The Bank’s borrowings were reported at Rs 66. 119 billion as at 31 March 2026 versus Rs 61. 644 billion as of prior year-end, while overall costs decreased to 9. 83 percent for the current quarter as against 11. 57 percent for the prior period. The Bank’s period-end net IDR increased to 71. 93 percent as against 69. 55 percent as at year-end 2025. Overall cost of funds decreased to 6. 94 percent for the period ended 31 March 2026 as against 8. 50 percent for the prior period. Non-Markup expenses were reported at Rs. 6. 691 billion for the period ended 31 March 2026 as against Rs 5. 215 billion for the prior period, indicating an increase of 28. 30 percent. However, this was in line with our expectations considering the Bank’s branch expansion plan, under which we achieved the milestone of opening over 123 branches since 31 March 2025. As of 31 March 2026, the number of our branches increased to 674 branches; up from 670 branches as at the end of previous year. The Board has given firm directions, and the management remains committed on practicing rigorous cost control measures to keep costs within strict budgets. The Bank achieved a significant improvement in asset quality during the period ended 31 March 2026. Effective recovery initiatives resulted in the Non-Performing Loan (NPL) ratio declining to 2. 93 percent, compared to 3. 41 percent as of December 2025. This favorable trend enabled a net reversal of Rs 689. 285 million in credit loss allowances, a marked turnaround from the Rs 300. 637 million charge recorded in the prior period. Despite this reversal, the Bank continued its prudent provisioning policy, strengthening the loan loss coverage ratio to 98. 77 percent, compared to 96. 77 percent as of 31 December 2025. Management remains vigilant in monitoring the portfolio to mitigate potential credit infection and maintain optimal coverage levels. The Bank’s Capital Adequacy Ratio as at 31 March 2026 stands at 13. 98 percent, while the Leverage Ratio is at 3. 10 percent. The Bank’s Liquidity Coverage Ratio and Net Stable Funding Ratios have been reported at 199. 91 percent and 187. 86 percent respectively, which are also comfortably above the regulatory requirements. The Pakistan Credit Rating Agency reaffirmed the Bank’s ‘AA-’ long-term and ‘A1+’ short-term ratings with a ‘Stable’ outlook, alongside ‘A+’ and ‘A’ ratings of listed TFCs-Teir II and TFCs- Tier-I respectively. These benchmarks reflect the Bank’s robust corporate governance, diversified operations, and strong capacity to meet all financial commitments. Driven by a commitment to shareholder value, the Soneri Bank continues to refine its customer-centric approach. By delivering specialized solutions across our business segments, we proactively meet the shifting needs of our customers while maintaining a focus on core profitability and strategic excellence. Copyright Business Recorder, 2026

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