FIRST ASIA SECURITIES
PakistanSri LankaPREV
EquitiesFixed Income
DATA AS OF 13 JUL 2026 · EOD

MCB

MCB Bank
BANKS

LAST · PKR

412.51
−4.86 ▼ −1.16%
P/E 8.3× · YIELD 9.0% · ROE 18.8%

52W RANGE

307.88432.59
84% OF RANGE · YTD +12.4%
01 / MCB — 1 YearAS OF 13 JUL 2026 · EOD
PERIOD 1Y · 250 SESSIONS▲
The Call
NEUTRAL+4%
430.00PKR · 12-MO
8.6× FY26E

CASA defends spread; yield carries return.

Risks to our view
02 /

FAS DESK · FIRST ASIA SECURITIES RESEARCH · 23 JUN 2026 · EOD

Premium CASA, premium price

  1. 01

    Neutral, PKR 430 target: MCB is the quality CASA bank — 18.8% ROE, 9.0% yield, famed cost discipline — but at 8.3× the quality is largely priced.

  2. 02

    A low-cost current-account franchise is the best defence against falling rates, protecting spread where peers leak.

  3. 03

    Cost discipline and benign credit costs keep returns steady through the cycle.

  4. 04

    At ~8.6× FY26E the target is PKR 430 — high-single-digit price upside; the 9.0% yield does the heavy lifting.

Where we differ from the street
Street viewOur viewWe change our mind if
MCB always trades up — limited re-rating left.Quality is real but mostly priced; the return is the dividend, not multiple expansion.A step-up in growth or a sector-wide re-rating.
Even the best CASA bank loses spread as rates fall.It loses least; the current-account mix is the moat.CASA mix deteriorating materially.
Conservative lending caps loan growth.Fee income and investment gains supplement modest credit growth; steady, not fast.A sustained drop in non-interest income.

— FIRST ASIA SECURITIES RESEARCH · NOT INVESTMENT ADVICE