KARACHI: BankIslami Pakistan Limited reported a profit after tax of PKR 900.1 million for the quarter ended March 31, 2026, reflecting a challenging operating environment despite continued growth in deposits and financing activities. The bank’s earnings per share (EPS) stood at PKR 0.81, compared with PKR 2.36 in the same period last year.

According to the bank’s quarterly financial report, customer deposits increased by 12% year-on-year to PKR 645.8 billion, highlighting continued customer confidence. However, deposits declined slightly by 2.2% compared to the end of December 2025 as the bank strategically reduced high-cost deposits. Meanwhile, the CASA ratio improved to 74.9%, reflecting a stronger low-cost deposit base.

BankIslami’s net financing and related assets reached PKR 293.4 billion, up 3.4% from the corresponding period last year, while its investment portfolio expanded to PKR 341.9 billion, representing a 5.9% increase from December 2025. The bank also reported an improvement in asset quality, with its delinquent financing ratio declining to 6.6% and maintaining a healthy coverage ratio of 114%.

Despite the balance sheet growth, profitability came under pressure as total income declined by 20.7% year-on-year to PKR 9.81 billion. The decline was primarily attributed to lower policy rates, reduced capital gains on investments, and weaker non-funded income. At the same time, operating expenses rose 20.1% due to inflationary pressures and continued investment in technology and infrastructure. As a result, profit before tax fell to PKR 1.87 billion, while profit after tax declined by 65.6% compared with the same quarter last year.

The bank noted that Pakistan’s economy continued to stabilize during the quarter under the IMF-supported reform program, although geopolitical tensions in the Middle East and higher global oil prices have created fresh risks for inflation and the external account. Management expects disciplined reforms and continued support from international partners to remain key factors in sustaining economic stability.

Looking ahead, BankIslami said it remains focused on strengthening its low-cost funding base, maintaining prudent risk management, and pursuing sustainable long-term growth. The bank also disclosed that, after the reporting period, the State Bank of Pakistan approved the commencement of operations for BIPL Exchange (Private) Limited, a development expected to support the group’s future growth strategy.