HUMBLE BEGINNINGS, 1947 1970

A LEGACY OF PUBLIC CONTROL, 1970 1980

BUSINESS AS USUAL, 1980-1990
PRIVATIZATION, 1990 1997
USHERING IN THE REFORMS, 1997 2006
THE POST-REFORM ERA, 2006 PRESENT

STATE BANK

State Bank of Pakistan

NATIONALIZED SCHEDULED
BANKS

National Bank of Pakistan

Bank of Punjab

SPECIALIZED BANKS

Industrial Development Bank

Zarai Taraqiati Bank Limited

CARD ISSUERS

Bank AL Habib
MCB Bank Limited

COMMERCIAL BANKS

Bank AL Habib
Habib Bank Limited

INVESTMENT BANKS

JS Investment Bank Limited

IGI Investment Bank Limited

HOUSING FINANCE
COMPANIES

Asian Housing Finance Limited

MICRO FINANCE BANKS

The First Micro Finance Bank Limited

Tameer Microfinance Bank Limited

ISLAMIC BANKS

Dubai Islamic Bank Pakistan Limited

Meezan Bank Limited-Premier Islamic Bank In Pakistan

VISION
HISTORY

INTRODUCTION

Bank AL Habib was incorporated as a

Public Limited Company in October 1991

Started banking operations in 1992

In 2005, Bank AL Habib began offering

internet banking

In 2006, Bank AL Habib became partners

with MasterCard.

TO BE A QUALITY FINANCIAL SERVICE

PROVIDER MAINTAINING THE
HIGHEST STANDARDS IN BANKING
PRACTICES

TO BE A STRONG AND STABLE FINANCIAL

INSTITUTION OFFERING INNOVATIVE PRODUCTS
AND SERVICES WHILE CONTRIBUTING TOWARDS
THE NATIONAL ECONOMIC AND SOCIAL
DEVELOPMENT

To track individual firm

performance over time

To make comparative
judgments regarding firm
performance.

FINANCIAL RATIOS

PROFITABILITY
RATIO

LIQUIDITY RATIO

RISK MANAGEMENT
RATIO

RETURN ON
EQUITY
EARNING PER
SHARE

ASSET
UTILIZATION
RATIO

EQUITY
MULTIPLIER

NET MARGIN

RETURN ON
ASSETS

AVERAGE
EARNING ASSETS
NET INTEREST
MARGIN

NET NON
INTEREST MARGIN

ROE= NET INCOME / TOTAL EQUITY CAPITAL

HBL
0.2847

BAHL

0.2759
0.2483
0.2350

0.2811

0.2044
0.1744
0.1937
0.1720

0.1831

0.1784
0.1552

2006

2007

BAHL
HBL

2008

2009

2010

2011

2006

2007

2008

2009

2010

2011

0.2847

0.2759

0.2483

0.2350

0.1552

0.1831

0.2811

0.1937

0.1720

0.1784

0.1744

0.2044

ROA= NET INCOME / TOTAL ASSETS

HBL

BAHL

0.0214

0.0155

0.0158

0.0157

0.0195
0.0176

0.0153
0.0140

0.0134

0.0116
0.0086

0.0076

2006

2007

BAHL
HBL

2008

2009

2010

2011

2006

2007

2008

2009

2010

2011

0.0153

0.0157

0.0140

0.0116

0.0076

0.0086

0.0214

0.0134

0.0158

0.0155

0.0176

0.0195

AEA=LENDING TO OTHER FINENCIAL INSTITUTIONS + INVESTMENTS + ADVANCES

HBL

BAHL

857781887
710354890
676482904

561743115

592382740

475570289

307371534
264080012
217003020
98398015

2006

148726889

118623889

2007

BAHL
HBL

2008

2009

2010

2011

2006

2007

2008

2009

2010

2011

98398015

118623889

148726889

217003020

264080012

307371534

475570289

561743115

592382740

676482904

710354890

857781887

NIM=TOTAL INTEREST INCOME -- TOTAL INTEREST EXPENSES / AVERAGE EARNING ASSETS

HBL
6.41%

BAHL
6.59%

6.46%

6.31%

6.22%
5.58%

6.40%

4.43%
4.18%

3.84%
3.52%

2.95%

2006

2007

BAHL
HBL

2008

2009

2010

2011

2006

2007

2008

2009

2010

2011

3.84%

3.52%

4.43%

4.18%

2.95%

6.59%

6.41%

5.58%

6.22%

6.31%

6.46%

6.40%

NNIM = (TOTAL NON-INTEREST INCOME) (TOTAL NON-INTEREST EXPENSES) / AVERAGE

EARNING ASSETS
HBL
2006

2007

BAHL

2008

2009

2010

2011

-0.87%
-1.09%
-1.25%

-1.21%

-1.23%

-1.55%
-1.44%

-1.80%

-1.81%

-1.86%

BAHL
HBL

-1.81%

-1.81%

2006

2007

2008

2009

2010

2011

-1.09%

-0.87%

-1.25%

-1.55%

-1.21%

-1.23%

-1.86%

-1.44%

-1.81%

-1.80%

-1.81%

-1.81%

EM=TOTAL ASSETS / TOTAL EQUITY CAPITAL

HBL

BAHL

18.59

17.79

17.62

13.15

21.38

20.50

20.33

14.40
11.50

10.91

10.49

9.91

2006

2007

BAHL
HBL

2008

2009

2010

2011

2006

2007

2008

2009

2010

2011

18.59

17.62

17.79

20.33

20.50

21.38

13.15

14.40

10.91

11.50

9.91

10.49

NM= NET INCOME / AVERAGE EARNING ASSETS

HBL

BAHL

2.67%
2.42%
2.20%
1.98%

1.86%

1.79%

1.83%

1.80%

1.66%
1.33%
0.97%

0.86%

2006

2007

BAHL
HBL

2008

2009

2010

2011

2006

2007

2008

2009

2010

2011

1.79%

1.86%

1.66%

1.33%

0.86%

0.97%

2.67%

1.80%

1.83%

1.98%

2.20%

2.42%

AUR = TOTAL INTEREST INCOME + TOTAL NON-INTEREST INCOME (TOTAL OPERATING

REVENUE) / TOTAL ASSETS
HBL

BAHL

0.1084
0.1026

0.1010
0.0878

0.0807

0.0961

0.1020

0.0959

0.0814
0.0711

0.0236

0.0223

2006

2007

BAHL
HBL

2008

2009

2010

2011

2006

2007

2008

2009

2010

2011

0.0236

0.0223

0.0961

0.0959

0.0711

0.0814

0.0878

0.0807

0.1084

0.1010

0.1026

0.1020

EPS = TOTAL REVENUE / TOTAL NUMBER OF SHARES

HBL

BAHL
18.82

18.3

14.7

14.49

14.17

11.83

6.01
4.78

4.68

3.97

2.59

2006

2007

2008

BAHL
HBL

2009

2010

2006

2007

2008

2009

2010

2011

4.78

6.01

3.97

4.68

2.59

3.37

18.3

14.49

11.83

14.7

14.17

18.82

3.37

2011

EARNING ASSETS TO
DEPOSITS RATIO
EARNING ASSETS TO
TOTAL ASSET RATIO
CASH ASSETS TO
TOTAL ASSETS
RATIO

LOANS TO TOTAL
ASSETS RATIO
INVESTMENTS TO
TOTAL ASSETS
RATIO

CASH POSITION
INDICATOR RATIO

CAPACITY RATIO

DEMAND DEPOSIT

LIQUID ASSET
INDICATOR RATIO

CA/TA = CASH ASSETS / TOTAL ASSETS

HBL

BAHL
1.1325
1.1298

0.1385
0.0920

0.1018
2006

0.1392

0.1392

0.1105

0.0701
0.0761

0.0877

2007

2008
2006

0.0684

2009

2007

2008

2010
2009

2010

2011
2011

BAHL

0.0920

0.1018

0.0877

0.0761

0.0701

0.0684

HBL

0.1385

0.1105

0.1392

0.1392

1.1325

1.1298

BAHL is not up to the mark in case of Cash assets to total

assets which mean it has average of 0.4961 but HBL as
average of 2.7897 which is 2.2936 times more then BAHL.

It is just because they have incresed there cash

Assets along with them and other banks.

I / TA = INVESTMENTS / TOTAL ASSETS

HBL

BAHL

0.6420

0.4549
0.3759
0.2506

0.2373

0.2762

0.2013

0.1884
0.2498

0.1828
0.0017
2006

2007

BAHL
HBL

0.0000

2008

2009

2010

2011

2006

2007

2008

2009

2010

2011

0.1828

0.2498

0.0017

0.0000

0.4549

0.6420

0.2013

0.2373

0.1884

0.2506

0.2762

0.3759

BAHL is playing more with its Investments which is not a

healthy sign.

HBL is following demand and supply matrix and other risk

factors.

After 2009 the BAHL rapidly increase and improve its this
ratio and become more liquid then HBL.

L/TA = LOANS / TOTAL ASSETS

HBL

BAHL

0.7094
0.6156
0.5609

0.6623

0.5264
0.4904

0.5882
0.5097

0.3913
0.4243

0.4171
0.3052

2006

2007

BAHL
HBL

2008

2009

2010

2011

2006

2007

2008

2009

2010

2011

0.6156

0.5609

0.7094

0.4243

0.4171

0.3052

0.5882

0.5097

0.6623

0.5264

0.4904

0.3913

It is not a healthy sign because loan and advances give

interest income in return.

As banks comes under service industry and there main

income is basically Interest income.

Due to this reason BAHL NIM and NM is less then HBL.

EA/TA = EARNING ASSETS / TOTAL ASSETS

HBL

0.8556

BAHL

0.8687

0.8598

0.8399

0.8063

0.8008
0.8387

0.8005

0.7832

0.7492

0.0256

2006

2007

BAHL
HBL

2008

2009

0.0885

2010

2011

2006

2007

2008

2009

2010

2011

0.8556

0.8399

0.8387

0.8687

0.0256

0.0885

0.8005

0.7492

0.8598

0.7832

0.8008

0.8063

BAHL have a fluctuating trend with respect to HBL .

In 2006 and 2007 BAHL had more earning assets then the
HBL.

Trend changed in up coming years.

Earning assets of BAHL are fluctuating but HBLs earning

assets are increasing every yearly.

EA/D = EARNING ASSETS / TOTAL DEPOSITS

HBL

BAHL

1.1465
1.0763

1.0358

1.0331

1.0591

1.0300

0.9851
0.9800

1.0573

0.9921

0.9908

0.0309

2006

2007

BAHL
HBL

2008

2009

2010

2011

2006

2007

2008

2009

2010

2011

1.0763

1.0331

1.0300

1.1465

0.0309

1.0591

1.0358

1.0573

0.9921

0.9908

0.9851

0.9800

BAHL and HBL both are on same trend when we talk about
this ratio

BAHL improves in this field from last year

HBL is still having the dicline pattren which is not a

healthy sign for the HBL but it is in the favour of BAHL

BAHL is increasing its earning assets which mean it is

more liquitable bank then the HBL.

CPI = CASH + DEPOSITS IN OTHER BANKS / TOTAL ASSETS

HBL

BAHL

0.173
0.1392

0.1385

0.1627

0.1392

0.1018

0.1105
0.0920

0.0877
0.0761

2006

2007

BAHL
HBL

2008

0.0701

2009

0.0684

2010

2011

2006

2007

2008

2009

2010

2011

0.0920
0.1385

0.1018
0.1105

0.0877
0.1392

0.0761
0.1392

0.0701
0.173

0.0684
0.1627

For HBL this ratio represents severe upsand downs.

This ratio drastically falls below 0.79% in 2007.

The main reason was that in that year the banks balance
sheet shows nil amount of money at called short notice.

BAHL is facing this problem that there this ratio is

drastically falling below since 2008 till now
That mean BAHL may have to borrow money from other
banks at a high call money rate which in turn will increase
interest cost of the bank

LAI = LIQUID ASSETS (C+S) / TOTAL ASSETS

HBL

BAHL

0.7043

0.5179
0.3473

0.5057

0.4087
0.343

0.2793
0.2705

0.3113
0.2641

0.0690

0.0576
2006

2007

BAHL
HBL

2008

2009

2010

2011

2006

2007

2008

2009

2010

2011

0.2641
0.2793

0.3473
0.3113

0.0690
0.2705

0.0576
0.343

0.5179
0.4087

0.7043
0.5057

BAHL is performing more from previous 2 years but on the

other hand HBL also improve but it need more attention.

According to this ratio BAHL have more liquidity

then HBL.

CR = NET LOANS ( LOANS-LOAN RESERVES) / TOTAL ASSETS

HBL

BAHL

0.6623

0.6156
0.5609

0.5651

0.5882

0.5264
0.4904

0.5097
0.3913

0.4243

0.4171
0.3052

2006

2007

BAHL
HBL

2008

2009

2010

2011

2006

2007

2008

2009

2010

2011

0.6156
0.5882

0.5609
0.5097

0.5651
0.6623

0.4243
0.5264

0.4171
0.4904

0.3052
0.3913

2006 to 2008 BAHL have more loans then HBL but after
2009 BAHL issues less loan and advances then HBL so thats
why its loan to total assets ratio is 0.91% less then HBL.

loan and advances give interest income in return.

DDR = DEMAND DEPOSIT / TOTAL DEPOSIT

HBL

BAHL

0.8666
0.7950

0.8130

0.7904
0.8143

0.7729

0.7577

0.8283

0.8357

0.8129

0.8224

0.7086

2006

2007

BAHL
HBL

2008

2009

2010

2006

2007

2008

2009

2010

2011

0.7950
0.7729

0.8130
0.7086

0.8143
0.8666

0.7577
0.7904

0.8283
0.8129

0.8357
0.8224

2011

BAHL is performing well by improving its DDR which ultimately

mean that they are highly liquitable with respect to HBL.
that BAHL are not ncreasing there loans and investments but
there deposits are improving from there past record .
It mean that they have money but they keep it with them.
Which make them less risky and more liquitable bank.

NET LOAN

NON PERFORMING LOAN

% OF LOAN LOSSES

NET CHARGE OFF

%LL = PROVISION OF LOAN LOSSES / TOTAL LOAN AND LEASES

HBL

BAHL

2.16%
1.93%

1.83%

1.76%

1.51%
1.60%

0.82%
0.58%
0.39%
0.20%

0.12%
0.03%
2006

2007

BAHL
HBL

2008

2009

2010

2011

2006

2007

2008

2009

2010

2011

0.03%

0.12%

0.20%

0.39%

0.58%

1.60%

0.82%

2.16%

1.51%

1.93%

1.83%

1.76%

NCO = GIVEN IN BALANCE SHEET

HBL

BAHL

819,202

796,631

518,932
421,729

187,907
110,613

78116

1,629

2006

23,508

1,929

2007

91

709

2008

2009

2010

2011

2006

2007

2008

2009

2010

2011

BAHL

1,629

110,613

1,929

709

23,508

91

HBL

518,932

421,729

187,907

78116

819,202

796,631

NPL = PROVIDED IN FINANCIAL STATEMENTS

HBL

BAHL

2,943,863

388.263

216.628

2006

2007

BAHL
HBL

2,067.66

51,313.51

49,438.26
2008

320,363

46,677.08

40,053.22

27,692.77

3,032.99

862.55

2009

2010

2011

2006

2007

2008

2009

2010

2011

388.263

216.628

862.55

2,067.66

2,943,863

320,363

3,032.99

27,692.77

40,053.22

49,438.26

46,677.08

51,313.51

NL = TOTAL LOAN / TOTAL ASSETS

HBL

BAHL

0.6623
0.6156
0.5609
0.5264
0.5882

0.4904

0.5651
0.5097

0.3913
0.4243

0.4171
0.3052

2006

2007

BAHL
HBL

2008

2009

2010

2011

2006

2007

2008

2009

2010

2011

0.6156

0.5609

0.5651

0.4243

0.4171

0.3052

0.5882

0.5097

0.6623

0.5264

0.4904

0.3913

BAHL IS LESS PROFITABLE THEN HBL

BAHL HAS MORE LIQUIDITY THEN HBL

BAHL IS LESS RISKIER.