About United Bank Ltd. (UBL):
United Bank Limited (the Bank) is a banking company incorporated in Pakistan and is engaged in commercial banking and related services. The Bank's Ordinary shares are listed on all three stock exchanges in Pakistan whereas its Global Depository Receipts (GDRs) are on the list of the UK Listing Authority and the London Stock Exchange Professional Securities Market. These GDRs are also eligible for trading on the International Order Book System of the London Stock Exchange. Further, the GDRs constitute an offering in the United States only to qualified institutional investors.
Registered Office
13 Floor, UBL Building,
Jinnah Avenue, Blue Area
Islamabad, Pakistan
Website
Key Financial and Operating data: (year ended Dec 2010)
Total Assets: 698,784,979,000
Net Assets: 68,415,065,000
No. of Ordinary Shares (As of Dec 2010): 1,224,179,687
No. of Branches: 1123
Profit or Loss per Share (Half Year Ended June 2011): Rs 5.48
Market Price per Share (As of 30/9/2011): Rs 60.50
Credit Rating As of June 2011
Ratings By JCR-VIS
Short Term: A-1+
Long Term: AA+
Income Analysis:
The bank has shown growth in its spread income during the period 2003-10. The bank earned a lucrative 7% spread income on its average deposits outstanding during the period 2003-2010.The banks cost structure has deteriorated during the period 2004-08 however it has improved in 2009-10. The bank earned a rising profit per share during 2003-06, nonetheless, after 2006; there exist a general decline in profit per share.
Return and Efficiency:
The bank returned a healthy profit on its net assets amounting to no less than 50% over the period 2003-2010. It also managed to keep its administrative expenses well below its spread income on its deposits.
Risk, Liquidity and Depth of Banking Operations:
The banks risk profile remained above average over the years 2003-2010. Its ratio of total assets to the net assets remained 15 to 16; which seems to be high. Nonetheless, the bank has started declining its leverage to 10. The liquidity of the bank’s asset profile is trending upward, recently, owing to the higher proportion of liquid investments as compared to the ill-liquid loan portfolio. Greater proportion of investment in liquid asset may imply a higher level of illiquidity and risk of loan portfolio. Historically, the bank’s ability and willingness to extend loan was above average, however, its economic capital may not support its growing loan portfolios considering the current business environment.
Conclusion:
Overall financial performance of the bank remained satisfactory. The bank needs to improve its quality of capital so that it can enhance its core banking operations. The banks proportion of investment portfolio is markedly high.
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