Pakistani banks dominate APAC with strongest stock performance

KARACHI: Pakistani banks excelled in the ranking of Asia-Pacific (APAC) lenders with the best-performing stocks in 2024, thanks to the country’s economic recovery, which benefitted from the International Monetary Fund’s loan programme, according to S&P Global Market Intelligence.

In this ranking, Pakistani banks outperformed their regional peers, securing six positions in the top 15 Asia-Pacific lenders with the highest stock performance.Four Pakistan-based lenders, led by United Bank Ltd, made it into the top 10, data from the S&P Global Market Intelligence showed on Tuesday.

“United Bank, which has a market capitalisation of $1.68 billion, recorded a total stock return of 159.7 per cent to place second in a ranking of the region’s best-performing bank stocks,” it showed.

“It trailed behind Indonesia’s PT Bank Artha Graha Internasional Tbk, which has a market cap of $270 million and made total returns of 193.2 per cent in the year.”Three other Pakistani banks in the top 10 were the National Bank of Pakistan (NBP), which achieved a return of 108.4 per cent; Bank Alfalah Limited with a return of 107.1 per cent; and the Bank of Punjab, which had a return of 98.4 per cent.

Furthermore, Allied Bank Limited (ABL) and Habib Metropolitan Bank Limited ranked 14th and 15th, with returns of 94.5 per cent and 93.2 per cent, respectively.Many Pakistani banks rebounded from a previous decline in share prices, which had been driven by a weakening economy and rising inflation, among other challenges, as reported by S&P Global Market Intelligence.

The recovery of Pakistan’s economy in the second half of 2024 was significantly supported by the International Monetary Fund’s funding programme, it added. Citing Awais Ashraf, director of research at AKD Securities Ltd., the Market Intelligence said that Pakistan’s government’s adoption of tight fiscal and monetary policies under the umbrella of the IMF, alongside timely external payments amid a smooth transition of government, led to a rebound in the local stock market.“Nonetheless, reform implementation remains critical for continued economic recovery and poverty reduction, the World Bank said on October 10, 2024,” it said.