NBP pensioners entitled to govt pension increases after court dismisses bank’s appeal
National Bank of Pakistan (NBP) pensioners have been declared entitled to government-announced pension increases after the Federal Constitutional Court (FCC) dismissed the bank’s appeal in a long-running pension case. NBP Company Secretary (Acting) Mehnaz Salar, in a notice to the Pakistan Stock Exchange (PSX) on Thursday, said the FCC on September 16 announced its judgment in ‘Civil Appeal No.…
The Federal Constitutional Court (FCC) of Pakistan has dismissed National Bank of Pakistan's (NBP) appeal, leading to pensioners being entitled to government-announced pension increases. The decision, rendered on September 16, 2021, in 'Civil Appeal No. 1688/2021, National Bank of Pakistan & others vs. Khawaja Abdul Hameed Nasir & others', was announced by the FCC in a notice addressed to the Pakistan Stock Exchange (PSX).
NBP Company Secretary (Acting) Mehnaz Salar conveyed this information in a notice to the PSX on Thursday. The full text of the judgment is currently awaited.
Brokerage house Topline Securities anticipates that this ruling may necessitate additional provisioning by NBP relating to pension obligations, although the exact amount remains unknown. The earlier Lahore High Court ruling in 2016 directed NBP to extend government-announced pension increases to its pensioners. However, the Supreme Court subsequently suspended this order and, within the main pension case, only pensioners who were parties to the litigation received the increases.
Consequently, the latest judgment now extends the benefit of these government-announced pension increases to the NBP pensioners who were not involved in the prior litigation.
Topline Securities estimated that an additional Rs5 billion in pension provision could result in an incremental after-tax impact of Rs1.1–1.3 per share on NBP's earnings. The brokerage mentioned that NBP had already allocated Rs57.5 billion in 2024 on account of past service pension costs, which took total pension-fund costs to Rs72.6 billion.
This figure is compared to Rs4.4 billion in 2023, including recurring impacts. The pension-fund cost subsequently decreased to Rs8.7 billion in 2025, primarily due to changes in the discount rate. In 2024, benefits paid by NBP rose to Rs20 billion, a significant increase from the historical run rate of around Rs1.7–1.8 billion during 2021–2023.
As a result, the bank's net payable pension liability stood at Rs75.6 billion in 2024, compared to Rs22.9 billion in 2023. It is important to note that these figures relate solely to the pension fund and exclude medical benefits, gratuity schemes, and other obligations.
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