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However in percentage terms the increase in markup

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). However, in percentage terms the increase in markup income is less than markup expense. Similar to the previous quarter, the non-mark up income is showing a greater increase. The ROA, ROE and NIM remained almost at the same level as compared to previous quarter (see Table 8 ). The measures of returns and profitability remained good. However, the measures of asset quality are showing some slippages especially owing to the rising trend in NPFs—almost all indicators of infection have further deteriorated during the quarter. The earning and profitability ratios shows that share of markup income have declined at the expense of non-markup income. While, there is a rise in operating expenses to gross income from 65.1percent to 67.2 percent that reflects relatively higher operating expenses. However, there is a slight decline in personal expenses to operating expense ratio thus reflecting better control over personal expenses. To sum up, we can say that the profitability has remained largely intact, though the quality of assets continued to decline. Table 7: Income and expenses (selected items) Rupees in billion Jun 09 Sep 09 % Change* Mark-up/Return Earned 15.4 23.0 49.3 Mark-up/Return Expenses 8.3 12.6 52.2 Net mark up income 7.2 10.4 46.1 Fees Commission & Brokerage Income 0.8 1.1 46.8 Other Income 0.1 0.3 97.0 Total Income 7.0 10.6 76.7 Administrative expenses 5.6 8.8 57.1 Other expenses 0.004 0.009 125.0 Total Non-Mark up /Return Expenses 5.7 8.8 56.6 Profit/(loss) after taxation 1.1 1.5 38.4 Table 8: Various performance indicators Jun 09 Sep 09 Change (percentage points) Earnings ROA After Tax 0.8% 0.7% -0.1 ROE After Tax 6.0% 5.4% -0.6 Net Markup Margin (NMM) 6.0% 5.7% -0.3 Intermediation Cost 4.9% 4.9% -- Assets Quality NPFs to Financing 5.0% 6.5% 1.5 Net NPFs to Net Financing 2.4% 3.0% 0.6 Earnings and Profitability Net Markup Income to Gross Income 82.0% 79.0% -3.0 Non-markup Income to Gross Income 18.0% 21.0% 3.0 Operating expense to Gross Income 65.1 67.2 2.1 Personnel Expense to Operating Expense 29.7% 29.1% -0.6
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July-September 2009 9 Dawood Islamic Bank 2 Overview of company Dawood Islamic Bank Limited (DIBL) was incorporated in Pakistan as a public limited company on August 29, 2005. The bank obtained “Scheduled Islamic Commercial Bank” license in 2007. The bank is principally engaged in commercial, consumer and investment activities. Branch network DIBL has 31 branches (as on September 30, 2009) in 12 cities of Pakistan. DIBL branch network growth is expected to rise to a figure of 50 by the end of 2009 in line with objective of State Bank of Pakistan, To enhance economic activities in rural areas, DIBL has launched Rural Business Centers (RBCs) program. Products/services range DIBL is offering wide range of Shariah compliant products & services on Asset & Liability sides. DIBL products range includes, working capital finance through Murabaha for importers and exporters, Shariah compliant substitute for conventional foreign and local bills discounting. Running Finance Musharakah (based on Shirkat-ul-Aqd) is offered as substitute for conventional banking running finance facility. Services Ijarah is used to finance services based trade & industries.
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