HBL’s Q2 2025 earnings: growth, gains, and a healthy dividend

Habib Bank Limited (HBL) just posted its earnings for the second quarter of calendar year 2025, and the numbers show some solid progress.

Profit update

HBL earned Rs17.8 billion in the quarter, that’s about Rs12.1 per share. This is 24% higher than last year, and a 7% jump compared to the previous quarter.

For the first half of the year (Jan–June), HBL has made Rs34.4 billion in total profit, which is 16% higher than the same time last year.

Dividend announcement

Along with the results, HBL also gave a pleasant surprise to investors:
A Rs4.5/share dividend, bringing the total payout for the first half of 2025 to Rs9.0/share.

Strong deposit growth

HBL’s deposits reached a new record, now standing at over Rs5.2 trillion, up 19% from last year.

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What helped earnings?

• Net interest income (the difference between what the bank earns on loans vs. what it pays on deposits) grew by 12% YoY.
• Non-interest income also did well, thanks to:
  • Capital gains (up 184% YoY!)
  • Other income sources (up 58% YoY)
• Expenses were controlled, with operating expenses only rising 9% YoY.

Some challenges

• Interest earned dropped 20% YoY, mostly due to lower interest rates.
• Fee income and dividend income declined during the quarter.
• The bank also set aside Rs1.9 billion as provisioning (a safety buffer for potential bad loans).

Tax impact

HBL paid a higher effective tax rate this time, 53.9%, compared to 49.5% last year.

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By the numbers

• Earnings per share (EPS): Rs12.1 (quarter) | Rs24.4 (1HCY25)
• Cost-to-income ratio: 55.7% (slightly improved from 57.7% last year)
• Net Interest Margin (NIM): 4.5%
• Book Value per Share: Rs307

HBL continues to show strong financial health, especially in deposit growth and profitability. While interest earnings are under pressure, the bank has done well in managing costs and boosting income from other sources. With a healthy dividend and a solid balance sheet, the outlook remains steady.

⚠️ This post reflects the author’s personal opinion and is for informational purposes only. It does not constitute financial advice. Investing involves risk and should be done independently. Read full disclaimer →