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UBL: 9MCY09 Result Review

AKD Research

UBL: 9MCY09 Result Review (Inline)

26th October, 2009

United Bank Limited (UBL) has announced its 9MCY09 result. On a consolidated basis, UBL has posted NPAT of PkR6.94bn (EPS: PkR6.23) in 9MCY09 against NPAT of PkR9.05bn (EPS: PkR8.13) in 9MCY08, a decline of 23%YoY. This was inline with our forecasted 9MCY09 NPAT of PkR6.79bn (EPS: PkR6.10).

In 3QCY09, NPAT has registered at PkR2.34bn (EPS: PkR2.10), up by 28%QoQ. Sequential increase in earnings is due to: 1) 7%QoQ increase in net interest income, 2) 36%QoQ decline in total provisions and 3) 1%QoQ contraction in administrative expenses. This has countered the impact of a 39%QoQ decline in non-interest income (loss on FX trading).

As per the result announcement, remaining impairment backlog is just PkR86mn (EPS impact: PkR0.04). 9MCY09 results represent 80% of our CY09F NPAT. UBL trades at a CY10F Tier-I P/B multiple of 1.3x. At current levels, the scrip offers an upside of 7.4% to our target price of PkR67/share.

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