Record Profit
ISLAMABAD: The State Bank of Pakistan (SBP) has disclosed its financial performance showing a record profit of Rs 1.14 trillion for the fiscal year ending on June 30, 2023 (FY2022-23).
The central bank achieved a profit of 1.143 trillion. It marked a 52.51% year-on-year record increase compared to the profit of Rs749.43 billion in the Same Period Last Year (SPLY).
Breaking down the results, the central bank’s net profit from financial assets saw an impressive 2.2x year-on-year increase, reaching Rs2.04 trillion in FY23, in contrast to the Rs935.72 billion earned in FY22.
This substantial growth can be primarily attributed to the share of profit earned on financial assets measured at amortized cost, which the central bank reported at Rs2.19 trillion in FY23, reflecting a massive 2.23x year-on-year jump.
Additionally, this positive trend was further bolstered by a substantial reduction in markup expenses, which decreased by 2.44x year-on-year.
The SBP observed a significant shift in its Fair Valuation Adjustment for COVID-related loans (net). In FY22, this adjustment stood at a negative Rs63.22 billion. However, during the most recent fiscal year, it turned positive, amounting to Rs230.89 million.
Conversely, the central bank reported a significant exchange loss of Rs875.02 billion in FY23, compared to the Rs62 billion loss reported in the SPLY.
Income generated through dividends and associates decreased by 4.89% year-on-year to Rs605 million and 4.81% year-on-year to Rs729.56 million, respectively, during the review period. Meanwhile, commission and other income saw substantial increases, reaching Rs9.19 billion and Rs37.47 billion in FY23.
Notably, the regulator managed to reduce its operating loss by an impressive 94% year-on-year, bringing it down to just Rs525.48 million.
On the expense side, operating expenses increased by 12.85% year-on-year, amounting to Rs72.15 billion in FY23, in contrast to the previous year’s operating costs of Rs64.44 billion. This increase in expenses is attributed to a surge in general administrative expenses and printing charges for banknotes and prize bonds, which amounted to Rs42.74 billion and Rs17.78 billion, respectively. These figures represent year-on-year increases of 13.87% and 14.86%.
The profit and loss statement highlights a substantial increase in total provisions, which reached 2.38 times the previous year’s figure, totaling Rs896.56 billion in FY23. Furthermore, the net charge for credit loss allowance on financial instruments reported by the SBP significantly increased to Rs213.33 million during the review period.
In terms of taxation, the central bank paid a higher tax of Rs1.88 billion compared to the Rs1.43 billion incurred in FY22.
I am an experienced writer, analyst, and author. My exposure in English journalism spans more than 28 years. In the past, I have been working with daily The Muslim (Lahore Bureau), daily Business Recorder (Lahore/Islamabad Bureaus), Daily Times, Islamabad, daily The Nation (Lahore and Karachi). With daily The Nation, I have served as Resident Editor, Karachi. Since 2009, I have been working as a Freelance Writer/Editor for American organizations.
