| Meezan Bank Ltd - 2005 |
================================================================================ BALANCE SHEET AS AT DECEMBER 31, 2005 ================================================================================ 2005 2004 Notes Rupees in '000 ================================================================================ ASSETS: Cash and balances with treasury banks 7 3,956,938 2,623,588 Balances with other banks 8 2,855,823 1,751083 Due from financial institutions - - Investments 9 1,606,490 1,429,053 Financings 10 19,740,886 12,339,745 Other assets 11 2,210,100 1,349,184 Operating fixed assets 12 305,585 204,737 30,675,822 19,697,390 LIABILITIES: Bills payable 13 260,732 196,145 Due to financial institutions 14 2,981,714 2,862,139 Deposits and other accounts 15 22,769,262 13,769,807 Sub-ordinated loan - - Liabilities against assets subject to finance leases - - Other liabilities 16 1,469,258 770,631 Deferred taxation 17 170,274 286 27,651,240 17,599,008 Net assets 3,024,582 2,098,382 REPRESENTED BY: Share capital 18 2,036,582 1,346,017 Capital reserves 19 666,322 256,578 Revenue reserves 20 268,036 258,325 2,970,940 1,860,920 Advances against issue of right shares - 192,312 Surplus on revaluation of investments 21 53,642 45,150 3,024,582 2,098,382 Contingencies and commitments 22 ================================================================================ ================================================================================ PROFIT AND LOSS ACCOUNT FOR THE YEAR ENDED DECEMBER 31, 2005 ================================================================================ 2005 2004 Notes Rupees in '000 ================================================================================ Profit / return on financings, investments 23 1,459,229 534,400 and placements earned Return on deposits and other dues expenses 24 690,418 250,393 Net spread earned 768,811 284,007 Provision against non-performing financing 10.7 68,811 16,991 Provision / (reversal) for diminution in 9.2 (29,831) 1,750 value of investments Bad debts written off directly 10.8 - - - 38,980 18,741 Net spread after provisions 729,831 265,266 OTHER INCOME: Fee, commission and brokerage income 174,750 100,739 Capital gain on sale of investments 209,402 81,223 Dividend income 92,569 108,592 Unrealised gain on held for trading investments 9.1 57,792 42,081 Income from dealing in foreign currencies 77,961 26,830 Other income 25 9,677 5,628 Total other income 622,151 365,093 1,351,982 630,359 OTHER EXPENSES: Administrative expenses 26 718,384 409,296 Other provisions / write offs - - - Other charges 27 482 185 Total other expenses 718,866 409,481 633,116 220,878 Extraordinary unusual items - - Profit before taxation 633,116 220,878 Taxation - current - for the year 4,671 5,470 - prior years 39,002 - - deferred 169,988 (8,950) 28 213,661 (3,480) Profit after taxation 419,455 224,358 Unappropriated profit brought forward 191,559 12,073 611,014 236,431 APPROPRIATIONS AND TRANSFERS TRANSFERRED TO: Statutory reserve (83,891) (44,872) Reserve for issue of bonus shares (325,853) - (409,744) (44,872) Unappropriated profit carried forward 201,270 191,559 Basic earnings per share - (Rupees) 29 2.28 1.37 ================================================================================ ================================================================================ CASH FLOW STATEMENT FOR THE YEAR ENDED DECEMBER 31, 2005 ================================================================================ 2005 2004 Notes Rupees in '000 ================================================================================ CASH FLOW FROM OPERATING ACTIVITIES: Profit before taxation 633,116 220,878 Dividend income (92,569) (108,592) 540,547 112,286 Adjustments for non-cash charges Provision against non-performing financings (net) 68,811 16,991 Provision (reversal) for diminution (29,831) 1,750 in value of investments Unrealised gain on held for trading investments (57,792) (42,081) Gain on sale of shares in a subsidiary company - (450) Gain on sale of property, equipment and others (163) (704) Depreciation 67,410 43,707 Amortisation 3,331 1,093 51,766 20,306 592,313 132,592 (INCREASE) / DECREASE IN OPERATING ASSETS: Net investments in held for trading securities (77,551) 244,474 Financings (7,438,993) (4,959,658) Other assets (901,393) (656,842) (8,417,937) (5,372,026) INCREASE IN OPERATING LIABILITIES: Bills payable 64,587 27,083 Due to financial institutions 119,575 1,873,175 Deposits and other accounts 8,999,455 6,012,945 Other liabilities 698,634 393,288 9,882,251 8,306,491 2,056,627 3,067,057 Income tax paid (6,147) (7,112) Net cash flow from operating activities 2,050,480 3,059,945 CASH FLOW FROM INVESTING ACTIVITIES: Net investments in - held to maturity securities (852) (120,893) - available for sale securities 54,262 (90,329) - quoted associated undertakings 6,640 4,080 - unquoted associated undertakings (94,780) (286,000) Sale proceeds on disposal of shares in - 5,300 an unquoted subsidiary company Dividends received 95,520 107,118 Investments in operating fixed assets (173,395) (172,613) Sale proceeds on disposal of property, 1,969 2,317 equipment and others Net cash outflow from investing activities (110,636) (551 020) CASH FLOW FROM FINANCING ACTIVITIES: Amount received against issue of right shares 498,253 192,312 Dividend paid (7) (52,447) Net cash flow from financing activities 498,246 139,865 Net increase in cash and cash equivalents 2,438,090 2,648,790 Cash and cash equivalents as at January 30 4,374,671 1,725,881 Cash and cash equivalents as at December 30 6,812,761 4,374,671 ================================================================================ ===================================================================================================================================
STATEMENT OF CHANGES IN EQUITY FOR THE YEAR ENDED DECEMBER 31, 2005
===================================================================================================================================
Capital reserves Revenue reserves
Share capital Share Statutory Reserve for General Unappropriated Total
premium reserve issue of reserve profit
account bonus
shares
Rupees in '000
===================================================================================================================================
Balance as at January 1, 2004 1,064,045 33,333 211,706 106,405 209,000 12,073 1,636,562
Issue of bonus shares 281,972 (33,333) - (106,405) (142,234) - -
Profit after taxation for the year - - - - - 224,358 224,358
Transfer to statutory reserve - - 44,872 - - (44,872) -
Balance as at December 31, 2004 1,346,017 - 256,578 - 66,766 191,559 1,860,920
Issue of right shares 351,135 - - - - - 351,135
Issue of right shares 339,430 - - - - - 339,430
Profit after taxation for the year - - - - - 419,455 419,455
Transfer to statutory reserve - - 83,891 - - (83,891) -
Transfer to reserve for issue of
bonus shares - - - 325,853 - (325,853) -
Balance as at December 31, 2005 2,036,582 - 340,469 325,853 66,766 201,270 2,970,940
===================================================================================================================================NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 20051. LEGAL STATUS AND NATURE OF BUSINESS The Bank was incorporated in Pakistan on January 27, 1997 as a public limited company under the Companies Ordinance, 1984 and its shares are quoted on the Karachi Stock Exchange. The Bank was registered as an 'Investment Finance company' on August 8, 1997 and carried on the business of investment bbanking as permitted under SR 585(I)/87 dated July 13, 1987 in accordance and in conformity with the principles of Islamic Shariah. A 'certificate of commencement of business' was issued to the Bank on September 29, 1997. The Bank was granted a 'Scheduled Islamic Commercial Bank' licence on January 31, 2002 and formally commenced operations as a scheduled Islamic commercial bank with effect from March 20, 2002 on receiving notification in this regard from the State Bank of Pakistan (SBP) under section 37 of the State Bank of Pakistan Act, 1956. Currently, the Bank is engaged in commercial, consumer and investment banking activities. The Bank was operating through twenty eight branches as at December 31, 2005 (2004: sixteen). Its registered office is at 3rd Floor, PNSC Building, Moulvi Tamizuddin Khan Road, Karachi. 2. BASIS OF PRESENTATION These financial statements represent separate financial statements of Meezan Bank Limited. The consolidated financial statements of the group are being issued separately. The Bank provides financing mainly through murabaha, ijarah, musharakah, diminishing musharakah and export refinance under Islamic export refinance scheme. Under murabaha the goods are purchased and are then sold to the customers on credit. The purchases and sales arising under these arrangements are not reflected in these financial statements as such but are restricted to the amount of facility actually utilised and the appropriate portion of profit thereon. The income on such financings is recognised in accordance with the principles of Islamic Shariah. However income, if any, received which does not comply with the principles of Islamic Shariah is recognised as charity payable if so directed by the Executive Committee of the Shariah Supervisory Board. Standards, interpretations and amendments to published approved accounting standards that are not yet effective: Following amendments to existing standards applicable to the Bank have been published that are mandatory for the Bank's accounting periods beginning on or after January 1, 2006 or later periods: (i) IAS 19 (Amendments) - Employee Benefits effective from January 1, 2006 (ii) IAS 1 Presentation of Financial Statements - Capital Disclosures effective from January 1, 2007 Adoption of the above amendments in standards may only impact the extent of disclosures presented in the financial statements. Islamic Financial Accounting Standards 1 - Murabaha issued by the Institute of Chartered Accountants of Pakistan becomes effective from period beginning on or after January 1, 2006. 3. CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS The preparation of financial statements in conformity with approved accounting standards requires the use of certain critical accounting estimates. It also requires management to exercise its judgement in the process of applying the Bank's accounting policies. The areas involving a higher degree of judgement or complexity, or areas where assumptions and estimates are significant to the financial statements are as follows: (a) Critical judgement in classification of investments in accordance with the Bank's policy (notes 6.4.1 and 9). (b) Assumption and estimation in recognition of provision for current taxation (current and prior years) and deferred taxation (notes 17, 22.4 and 28). Estimates and judgements are continually evaluated and are based on historical experience and other factors, including expectation of future events that are believed to be reasonable under the circumstances. 4. STATEMENT OF COMPLIANCE 4.1. The financial statements have been prepared in accordance with the requirements of the Companies Ordinance, 1984 (the Ordinance), the Banking Companies Ordinance, 1962 (the Ordinance), the directives issued by the SBP including format for financial statements of Bank issued by SBP through BSD Circular No 36 dated October 10, 2001, and the International Accounting Standards (IASs) issued by the International Accounting Standards Committee (IASC) and interpretations issued by Standing Interpretation Committee of IASC (the interpretations), as adopted in Pakistan. However, the requirements of these Ordinances and the directives of the SBP have been followed in case where their requirements are not consistent with the requirements of the IASs and the interpretations. 4.2. The SBP through its BSD Circular letter No 10 dated August 26, 2002 has deferred the implementation of IAS 39, 'Financial Instruments: Recognition and Measurement' and IAS 40, 'Investment Property' for banks in Pakistan. Accordingly, the requirements of those IASs have not been considered in preparation of these financial statements. 5. BASIS OF MEASUREMENT These financial statements have been prepared under the historical cost convention except that certain investments are valued at market rates in accordance with the requirements of SBP's BSD Circular No 10 dated July 13, 2004 as amended through BSD Circular No 11 dated August 4, 2004 and BSD Circular No 14 dated September 24, 2004. 6. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES 6.1. CASH AND CASH EQUIVALENTS Cash and cash equivalents comprise of cash and balances with treasury banks and balances with other banks in current and deposit accounts. 6.2. REVENUE RECOGNITION (i) Profit on murabaha financings and placements is recognised on accrual basis, except the profit required to be suspended in compliance with the prudential regulations issued by the SBP which is recorded on receipt basis. Profit on murabaha is recognised on delivery of goods to the customer. (ii) The Bank follows the finance method in recognising income on ijarah contracts. Under this method the unearned income i.e. the excess of aggregate ijarah rentals over the cost of the asset and documentation charges under ijarah facility is deferred and then amortised over the term of the ijarah, so as to produce a constant rate of return on net investment in the ijarah. Gains / losses on termination of ijarah contracts are recognised as income on a receipt basis. Income on ijarah is recognised from the date of delivery of the respective assets to the mustajir. (iii) Consistent with prior years, profit on diminishing musharakah financings are recognised on accrual basis. Profit on musharakah financings is recognised on declaration of profit by musharakah partner. (iv) Commission on letters of credit, acceptances and guarantees is recognised on receipt basis, except for commission on guarantees in excess of Rs 50,000 which is recognised over the period of the guarantee. (v) Dividend income is recognised when the Bank's right to receive payment is established. (vi) Purchase and sale of investments are recorded on the dates of contract. Gains and losses on sale of investments are also recorded on those dates. 6.3. FINANCINGS Financings are stated net of specific and general provisions against non-performing financings, if any, which are charged to the profit and loss account. The Bank determines provisions against financings on a prudent basis in accordance with the prudential regulations issued by the SBP. Financings are written off when it is considered that there is no realistic prospect of recovery. 6.4. INVESTMENTS 6.4.1. THE BANK CLASSIFIES ITS INVESTMENTS AS FOLLOWS Held for trading These are investments acquired principally for the purpose of generating profit from short-term fluctuations in price. Held to maturity These are investments with fixed or determinable payments and fixed maturity and the Bank has positive intent and ability to hold to maturity. Available for sale These are investments which do not fall under the 'held for trading' or 'held to maturity' categories. 6.4.2. THE BANK VALUES ITS INVESTMENTS AS FOLLOWS -- Quoted securities, excluding investments categorised as 'held to maturity securities and investments in subsidiaries and associates, are stated at revalued amounts. -- Investments in quoted associates are stated at cost. -- Unquoted securities including investments in associates and subsidiaries are stated at cost less provision for impairment, if any. -- Investments in securities categorised as 'held to maturity' are carried at amortised cost. 6.4.3. Any surplus / deficit arising as a result of revaluation of quoted securities categorised as 'available for sale' is presented below the shareholders' equity in the balance sheet while any surplus / deficit arising as a result of revaluation of 'held for trading' securities is credited / charged to the profit and loss account. 6.4.4. Cost of investment is determined on moving average basis. The cost of acquisition of 'dealing securities' (i.e. quoted securities purchased and sold on the same day) is not considered for calculating the 'moving average cost' of other quoted securities (i.e. quoted securities sold after the date of purchase). 6.4.5. Impairment loss is recognised whenever the carrying amount of an investment exceeds its expected recoverable amount. An impairment loss is recognised in income currently. 6.5. OPERATING FIXED ASSETS 6.5.1. TANGIBLE ASSETS Operating fixed assets are stated at cost less accumulated depreciation and any identified impairment. Depreciation is charged to the profit and loss account applying the straight line method whereby the depreciable cost of an asset is written off over its estimated service life. The full annual rate of depreciation is applied on the depreciable cost of additions while no depreciation is charged on assets deleted during the year. Capital work in progress is stated at cost. Useful lives and residual values are reviewed at each balance sheet date, and adjusted if impact on depreciation is significant. As of December 31, 2005, the Bank has estimated the residual values of its vehicles and accordingly the depreciable cost has been adjusted. Had the residual values of vehicles not been considered for charging depreciation the profit after taxation for the year ended December 31, 2005 and net book values of the fixed assets as at that date would have been lower by Rs 1.446 million and Rs 2.751 million respectively. The effect on profit after taxation for the future periods as a result of the subject residual values is not considered material. Maintenance and normal repairs are charged to income as and when incurred. Items of fixed assets costing Rs 10,000 or less are not capitalised and are charged off in the year of purchase. Profit or loss on disposals of fixed assets is included in income currently. The Bank assesses at each balance sheet date whether there is any indication that the operating fixed assets may be impaired. If such indication exists, the carrying amounts of such assets are reviewed to assess whether they are recorded in excess of their recoverable amounts. Where carrying values exceeds the respective recoverable amount, assets are written down to their recoverable amounts and the resulting impairment charge is recognised in income. 6.5.2. INTANGIBLE ASSETS Intangible assets comprise of computer software. Accounting for such assets is on the same basis as for tangible fixed assets owned by the Bank. As at December 31, 2005 the Bank has revised its estimate of useful lives of computer software and accordingly the amortisation charge has been adjusted. Had the useful lives of computer software not been revised, the profit after taxation for the year ended December 31, 2005 and net book values of intangible assets would have been higher by Rs 0.781 million and Rs 1.487 million respectively. The effect on profit after taxation for the future periods as a result of revision of useful lives is not considered material. 6.6. TAXATION Current The charge for taxation is based on expected taxable income for the year at current rates of taxation, and any adjustments to tax payable in respect of previous years, after taking into consideration available tax credits, rebates and tax losses etc. Deferred The Bank accounts for deferred taxation using the balance sheet liability method on temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the financial statements. A deferred tax asset is recognised only to the extent that it is probable that future taxable profits will be available and the credits will be utilised. Deferred tax assets are reduced to the extent that it is no longer probable that the related tax benefit will be realised. 6.7. STAFF RETIREMENT BENEFITS Defined benefit plan The Bank operates a funded gratuity scheme for all its permanent employees who have completed the minimum qualifying eligible service of one year. The scheme was approved by the tax authorities in April 2000 and the last actuarial valuation was conducted as at December 31, 2005. The projected unit credit method was used for actuarial valuation. Actuarial gains or losses are recognised in accordance with the actuary's recommendation. Defined contribution plan The Bank also operates a recognised contributory provident fund for all its permanent employees. Equal monthly contributions are made, both by the Bank and the employees, to the fund at a rate of 10% of basic salary. 6.8. FOREIGN CURRENCIES Foreign currency transactions are recorded in rupees at exchange rates prevailing on the date of transaction. Assets, liabilities and contingencies and commitments in foreign currencies except forward contract other than contracts with the SBP at the year end are reported in rupees at exchange rates prevalent on the balance sheet date. Forward contracts other than contracts with the SBP relating to the foreign currency deposits are valued at forward rates applicable to the respective maturities of the relevant foreign exchange contract. Forward contracts with the SBP relating to foreign currency deposits are valued at spot rate prevailing at the balance sheet date. Exchange gains and losses are included in income currently. 6.9. PROVISIONS AND CONTINGENT ASSETS AND LIABILITIES Provisions are recognised when the Bank has a present legal or constructive obligation arising as a result of past events and it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation and a reliable estimate of the amount of the obligation can be made. Contingent assets are not recognised, and are also not disclosed unless an inflow of economic benefits is probable and contingent liabilities are not recognised, and are disclosed unless the probability of an outflow of resources embodying economic benefits is remote. Acceptances comprise undertakings by the Bank to pay bills of exchange drawn on customers. The Bank expects most acceptances to be settled simultaneously with the reimbursement from the customers. Acceptances are accounted for as off-balance sheet transactions and are disclosed as contingent liabilities and commitments. 6.10. OFFSETTING Financial assets and financial liabilities are offset and the net amount reported in the balance sheet when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis, or realise the asset and settle the liability simultaneously. 6.11. COMPENSATED ABSENCES The Bank recognises liability in respect of employees compensated absences in the period in which these are earned upto the balance sheet date. 7. CASH AND BALANCES WITH TREASURY BANKS ================================================================================
2005 2004
Notes Rupees in '000
================================================================================
IN HAND:
- local currency 715,331 266,600
- foreign currencies 117,213 59,858
WITH THE SBP IN:
- local currency current accounts 7.1 2,982,789 2,199,745
- foreign currency current accounts 7.1 136,043 97,000
With National Bank of Pakistan in
- local currency current accounts 5,562 385
3,956,938 2,623,588
================================================================================7.1. These represent local and foreign currency amounts required to be maintained by the Bank with the SBP as stipulated by the SBP.8. BALANCES WITH OTHER BANKS ================================================================================
2005 2004
Rupees in '000
================================================================================
IN PAKISTAN:
- on current accounts 57,689 21,818
- on deposit accounts - 164,716
OUTSIDE PAKISTAN:
- on current accounts 856,399 817,793
- on deposit accounts 1,941,735 746,756
2,855,823 1,751,083
================================================================================9. INVESTMENTS=====================================================================================================================
2005 2004
Held by Given as Held by Given as
the Bank collateral Total the Bank collateral Total
Notes Rupees in '000
=====================================================================================================================
INVESTMENTS BY TYPES:
Held for trading securities 9.3 298,449 - 298,449 178,817 - 178,817
Held to maturity securities 9.4 179,142 - 179,142 178,290 - 178,290
Available for sale securities 9 166,982 - 166,982 221,244 - 221,244
IN RELATED PARTIES:
Subsidiary (unquoted) 9.6 63,050 - 63,050 63,050 - 63,050
Associates (quoted) 9.7 525,106 - 525,106 351,746 - 351,746
Associates (unquoted) 9.8 252,780 - 252,780 103,000 - 103,000
Advance against issue of shares of
Pak-Kuwait Takaful Company Limited 17,000 - 17,000 - - -
Advance against issue of preference
shares of Falcon Greenwood
(Private) Limited (an associate) - - - 72,000 - 72,000
Advance against issue of certificates
by an associate - - - 180,000 - 180,000
1,502,509 - 1,502,509 1,348,147 - 1,348,147
ADD: SURPLUS ON REVALUATION OF INVESTMENTS:
- 'Held for trading' 57,792 - 57,792 42,081 - 42,081
- 'Available for sale' 53,642 - 53,642 45,150 - 45,150
1,613,943 - 1,613,943 1,435,378 - 1,435,378
Less: Provision for diminution in value
Of investment 9.2 7,453 - 7,453 6,325 - 6,325
1,606,490 - 1,606,490 1,429,053 - 1,429,053
=====================================================================================================================9.1. INVESTMENTS BY SEGMENTS================================================================================
2005 2004
Notes Rupees in '000
================================================================================
Fully paid up ordinary shares
- Listed companies 654,127 596,207
- Unlisted companies 174,050 166,050
Musharakah term finance certificates 20,502 30,600
Term finance certificates 29,563 -
Preference shares 141,780 -
Sukuk bonds 9.4 179,142 178,290
Units of an open end fund 125,000 125,000
Certificates of a closed end fund 161,345 -
Advance against issue of ordinary shares 17,000 -
Advance against issue of preference shares - 72,000
Advance against issue of certificates - 180,000
1,502,509 1,348,147
ADD: SURPLUS ON REVALUATION OF INVESTMENTS:
- 'Held for trading' 57,792 42,081
- 'Available for sale' 53,642 45,150
1,613,943 1,435,378
Less: Provision for diminution in 7,453 6,325
value of investments 9.2
1,606,490 1,429,053
================================================================================9.2. PARTICULARS OF PROVISION
===================================================================================================
2005 2004
Associates Others Total Associate Others Total
Rupees in '000
===================================================================================================
Opening balance 6,325 - 6,325 4,575 - 4,575
Transferred from provision against
non-performing financings - 30,959 30,959 - - -
Charge for the year 1,128 - 1,128 1,750 - 1,750
Reversal - (30,959) (30,959) - - -
1,128 (30,959) (29,831) 1,750 - 1,750
Closing balance 7,453 - 7,453 6,325 - 6,325
===================================================================================================9.3. HELD FOR TRADING SECURITIESThe Bank holds investments in ordinary shares of Rs 10 each, unless stated otherwise, in the following listed investee companies: =========================================================================================================
Name of the investee company 2005 2004 2005 2004
Number of shares Cost / carrying value
Notes Rupees in '000
=========================================================================================================
TEXTILE COMPOSITE:
Nishat (Chunian) Limited - 50,000 - 3,910
Nishat Mills Limited 125,000 - 13,021 -
SYNTHETIC AND RAYON:
Dewan Salman Fibres Limited 905,000 - 18,611 -
CEMENT:
DG Khan Cement Company Limited 133,000 60,000 13,992 2,870
Maple Leaf Cement Factory Limited 153,000 - 5,797 -
REFINERY:
National Refinery Limited 72,000 26,000 27,295 4,160
POWER GENERATION AND DISTRIBUTION:
Hub Power Company Limited 882,500 94,500 23,955 3,357
Kot Addu Power Company Limited 50,000 - 1,941 -
OIL AND GAS MARKETING:
Pakistan State Oil Company Limited 22,500 129,500 8,447 35,018
Shell Pakistan Limited - 8,000 - 3,354
Sui Southern Gas Company Limited 309,712 39,712 8,412 1,168
OIL AND GAS EXPLORATION:
Pakistan Oilfields Limited 153,000 55,000 43,656 11,818
Oil and Gas Development Company Limited 155,000 - 16,574 -
Pakistan Petroleum Limited 75,000 - 15,565 -
AUTOMOBILE ASSEMBLER:
Agriauto Industries Limited 9.3.1 180,000 180,000 9,792 8,865
Dewan Farooque Motors Limited 85,000 - 2,606 -
Indus Motor Company Limited 50,000 - 6,291 -
TECHNOLOGY AND COMMUNICATION:
Pakistan Telecommunication Company Limited (A) - 953,500 - 38,466
Callmate Telips Telecom Limited 354,750 - 10,020 -
FERTILISER:
Engro Chemical Pakistan Limited 120,000 - 18,437 -
Fauji Fertilizer Bin Qasim Company Limited 35,000 - 1,340 -
Fauji Fertilizer Company Limited 269,775 546,365 24,256 53,854
CHEMICAL:
ICI Pakistan Limited 50,000 - 7,008 -
PAPER AND BOARD:
Packages Limited 120,116 81,712 21,433 11,026
FOOD AND PERSONAL CARE PRODUCTS:
Unilever Pakistan Limited 9.3.2 - 980 - 874
MISCELLANEOUS:
Tri-Pack Films Limited - 900 - 77
298,449 178,817
=========================================================================================================9.3.1. The nominal value of these shares is Rs 5 each.9.3.2. The nominal value of these shares is Rs 50 each. 9.4. HELD TO MATURITY SECURITIES ==============================================================================================
Name of the investee entity 2005 2004 2005 2004
Number of bonds Cost
Notes Rupees in '000
==============================================================================================
Sukuk bonds
Qatar Global Sukuk Bonds
(Sukuk - Qatar) 9.4.1 1,000,000 1,000,000 59,714 59,430
Dubai Sukuk Bonds (Sukuk - Dubai) 9.4.2 2,000,000 2,000,000 119.428 118,860
179,142 178,290
==============================================================================================9.4.1. The paid up value of Sukuk - Qatar is US $ 1 per bond.The return on Sukuk - Qatar is on the basis of London inter-bank offered rate plus a fixed credit spread of forty basis points. These bonds will mature in 2010. 9.4.2. The paid up value of Sukuk - Dubai is US $ 1 per bond. The return on Sukuk - Dubai is on the basis of London inter-bank offered rate plus a fixed credit spread of forty five basis points. These bonds will mature in 2009. 9.5. AVAILABLE FOR SALE SECURITIES The Bank holds investments in ordinary shares, musharakah term finance certificates (MTFCs) and term finance certificates (TFCs) of a nominal value of Rs 10 each, unless stated otherwise, in the following listed investee companies: ========================================================================================================
Name of the investee company 2005 2004 2005 2004
Number of shares/ Cost
Notes certificates Rupees in 000
========================================================================================================
ORDINARY SHARES
AUTO ASSEMBLER:
Agriautos Industries Limited 9.3.1 120,000 120,000 5,929 5,929
POWER GENERATION AND DISTRIBUTION:
Hub Power Company Limited 1,500,000 1,500,000 49,000 49,000
OIL AND GAS MARKETING:
Pakistan State Oil Company Limited 75,280 100,280 20,569 27,401
Shell Pakistan Limited 35,750 45,000 9,727 15,305
Sui Southern Gas Company Limited 600,000 1,100,000 16,422 30,107
OIL AND GAS EXPLORATION:
Pakistan Oilfields Limited - 100,000 - 21,488
TECHNOLOGY AND COMMUNICATION:
Pakistan Telecommunication Company Limited (A) - 476,500 - 15,555
FERTILISER:
Fauji Fertilizer Company Limited 288,586 172,500 11,537 11,537
PAPER AND BOARD:
Packages Limited 44,100 30,000 3,733 1,829
FOOD AND PERSONAL CARE PRODUCTS:
Unilever Pakistan Limited 9.3.2 - 14,000 - 12,493
MTFCs:
Sitara Chemicals Limited 9.5.1 6,120 6,120 20,502 30,600
TFCs:
Dewan Cement Limited
(formerly Pakland Cement Limited) 9.5 - - 29,563 -
166,982 221,244
========================================================================================================9.5.1. The paid up value of MTFCs is Rs 3,350 (2004: Rs 5,000) per certificate. The return on MTFCs is on Musharakah basis and will mature in 2006 and 2007.9.5.2. During the year ended December 31, 2005, the Bank has reclassified the loan amounting to Rs 30.959 million receivable from Dewan Cement Limited (formerly Pakland Cement Limited) as part of its investments in TFCs as 'available for sale' securities in accordance with the SBP's Circular No BPD/PU-22/22.03/15749/2005/8720 dated July 14, 2005. The provision against these investment has been reversed as repayments from these TFCs are being received in accordance with the repayment schedule. The Bank holds following TFCs in the company: Series 'A' TFCs having face value of Rs 31.300 million; and Series 'B' TFCs having face value of Rs 5.600 million. Series 'A' TFCs represents principal amount and carries a yield of 6 months ask KIBOR + 2.5 percent whereas Series 'B' has been issued for accrued markup and carries no yield. The TFCs will be redeemed between the periods January 15, 2006 to July 15, 2013. Subsequent to year end the Bank has disposed off its investment in Series 'A' TFCs subject to certain conditions. The income relating to mark-up on TFCs have not been taken to profit and loss account pending its review in accordance with the Shariah requirements. 9.6. SUBSIDIARY (UNQUOTED) =================================================================================================================
Particulars 2005 2004 2005 2004 Percentage Break up Latest Name of the
of equity value per available chief executive
Number of holding share financial
Shares Rupees in '000 % Rupees statements
=================================================================================================================
Al Meezan Investment 650,000 650,000 63,050 63,050 65 396.37 December 31, Mr Mohammad
Management Limited 2005* Shoaib
(ordinary shares)
- note 9.6.1
Total 63,050 63,050
=================================================================================================================*HaIf yearly unaudited financial statements.9.6.1. The nominal value of these shares is Rs 100 each. 9.7. ASSOCIATES (QUOTED) The Bank holds investments in ordinary shares, certificates and units of Rs 10 each, unless stated otherwise, in the following listed investee entities: ======================================================================================================
Name of the investee entity 2005 2004 Percentage 2005 2004
of direct equity
Number of shares / holding
Note certificates / units % Rupees in '000
======================================================================================================
ORDINARY SHARES
CLOSED END MUTUAL FUND:
Al Meezan Mutual Fund Limited 3,160,680 1,784,800 2.64 24,165 12,150
CERTIFICATES OF CLOSED END FUND:
Meezan Balanced Fund 16,134,468 - N/A 161,345 -
MODARABA:
Fayzan Manufacturing Modaraba 21,457,500 21,457,500 23.84 214,596 214,596
UNITS OF AN OPEN END FUND:
Meezan Islamic Fund 9.7.1 3,687,954 2,841,095 N/A 125,000 125,000
525,106 351,746
======================================================================================================9.7.1. The nominal value of these units is Rs 50 each.9.7.2. The above associates are incorporated in Pakistan. 9.7.3. Investments in quoted associates have a market value of Rs 726.009 million (2004: Rs 480.230 million). 9.8. ASSOCIATES (UNQUOTED) The Bank holds investments in ordinary shares of Rs 10 each, unless stated otherwise, and preference shares of Rs 100 each in the following unlisted investee companies: ===============================================================================================================================================
Particular 2005 2004 2005 2004 Percentage Break up Latest Name of the
of equity value per available chief executive
Number of holding share financial
Notes shares / certificates Rupees in' 000 % Rupees statements
===============================================================================================================================================
Plexus (Private) December 31, Mr Ariful Islam
Limited 1,499,980 1,499,980 15,000 15,000 50 6.71 2005*
Faysal Management December 31, Mr Khalid S.
Services (Private) 2005 Tirmizey
Limited 9.8.1 540,000 540,000 54,000 54,000 30 117.80
Blue Water (Private) December 31, Mr Shuja-ul-Mulk
Limited 9.8.1 90,000 90,000 9,000 9,000 30 100 2005*
Falcon Greenwood December 31, Mr Abbas Khan
(Private) Limited 2005*
- Ordinary shares -
9.8.1 250,000 250,000 25,000 25,000 25 100
- Preference shares -
9.8.2 1,417,800 - 141,780 - N/A N/A
Pak-Kuwait Takaful December 31, Mr lstaqbal
Company Limited 800,000 - 8,000 - 10 8.59 2005* Mehdi
Total 252,780 103,000
=============================================================================================================================================== Unaudited9.8.1. The nominal value of these shares is Rs 100 each. 9.8.2. The nominal value of these preference shares is Rs 100 each. The preference shares have no voting rights. These preference shares are redeemable at the option of the investee company. 9.8.3. The above associates are incorporated in Pakistan. 10. FINANCINGS ================================================================================
2005 2004
Notes Rupees in '000
================================================================================
IN PAKISTAN:
Murabaha financings 8,117,096 4,856,083
Net investment in ijarah 10.2 5,103,433 3,221,480
Export refinance under Islamic scheme 2,923,000 2,705,274
Diminishing musharakah financings - housing 1,900,763 677,349
Diminishing musharakah financings - others 983,557 467,269
Musharakah financings 104,500 104,500
Financings against bills - salam 260,532 183,166
Financings against bills - murabaha 353,433 87,779
Loans, running finances, etc. 10.3 111,246 115,667
Total financings 10.4, 10.5 & 10.6 19,857,560 12,418,567
Less: Provision against
non-performing financings 10.7 116,674 78,822
19,740,886 12,339,745
================================================================================10.1. PARTICULARS OF FINANCINGS10.1.1. ================================================================================
2005 2004
Rupees in '000
================================================================================
IN:
- local currency 18,894,113 12,132,123
- foreign currencies 846,773 207,622
19,740,886 12,339,745
================================================================================10.1.2.================================================================================
2005 2004
Rupees in '000
================================================================================
Short-term (for up to one year) 13,211,186 8,583,182
Long-term (for over one year) 6,529,700 3,756,563
19,740,886 12,339,745
================================================================================10.2. NET INVESTMENT IN IJARAH=======================================================================================================================
2005 2004
Not later Later than Over Total Not later Later than Over Total
than one one and five than one one and five
year less years year less years
than five than five
years years
Rupees in '000
=======================================================================================================================
ljarah rentals receivable 1,748,678 2,918,730 677,989 5,345,397 950,976 2,332,991 9,697 3,293,664
Residual value 137,663 679,568 68,397 885,628 14,650 452,418 395 467,463
Minimum ijarah payments 1,886,341 3,598,298 746,386 6,231,025 965,626 2,785,409 10,092 3,761,127
Profits for future periods 467,125 572,543 87,924 1,127,592 223,969 313,486 2,192 539,647
Present value of minimum
ijarah payments 1,419,216 3,025,755 658,462 5,103,433 741,657 2,471,923 7,900 3,221,480
=======================================================================================================================10.3. This includes Rs 84.493 million (2004: Rs 56.691 million) representing mark-up free loans to staff advanced under the Bank's human resource policies.10.4. LOANS AND FINANCINGS TO EXECUTIVES AND A DIRECTOR ===========================================================================
Executives Director
2005 2004 2005 2004
Rupees in
===========================================================================
Opening balance 36,087 23,329 960 1,093
Loans disbursed during the year 24,871 16,519 - -
Loans repaid during the year (6,640) (3,761) (133) (133)
Closing balance 54,318 36,087 827 960
===========================================================================10.5. PARTICULARS OF LOANS AND FINANCINGS TO EXECUTIVES, DIRECTOR, ASSOCIATED COMPANIES ETC.===========================================================================================
Balance as at Maximum total
December 31, amount of
2005 financings including
temporary financings
granted during the year*
Notes Rupees in '000
===========================================================================================
Debts due by directors, executives
or officers of the Bank or any of them either
severally or jointly with any other persons 121,902 121,902
Debts due by companies or firms in which
the directors of the Bank are interested as
directors, partners or in the case
of private companies as members 10.5.1 311,912 311,912
Debts due by subsidiary companies,
controlled firms, managed modarabas
and other related parties 10.5.2 2,187 2,541
436,001 436,355
=========================================================================================== * The maximum amount has been calculated by reference to month end balances.10.5.1. This represents a musharakah facility outstanding from Blue Water (Private) Limited (an associated company) amounting to Rs 94.500 million (2004: Rs 94.500 million) and murabaha, financings against bills and ijarah facilities outstanding from The General Tyre and Rubber Company of Pakistan Limited (an associated company) amounting to Rs 50 million, Rs 72.015 million and Rs 95.396 million (2004: Rs 52.417 million) respectively. The musharakah facility is secured against equitable mortgage over property, whereas murabaha and financings against bills and ijarah facilities are secured against hypothecation charge over present and future stocks, book debts and the rented assets respectively. 10.5.2. This represents an ijarah facility outstanding from Al Meezan Investment Management Limited (a subsidiary company). The ijarah facility is secured against the respective assets. 10.6. Financings include Rs 183.373 million (2004: Rs 59.971 million) which have been placed under non-performing status as detailed below: ================================================================================
Category of classification Domestic Overseas Total Provision Provision
required held
Rupees in '000
================================================================================
Substandard 89,771 - 89,771 20,788 20,788
Doubtful 47,557 - 47,557 120 120
Loss 46,045 - 46,045 46,045 46,045
1 83,373 - 183,373 66,953 66,953
================================================================================10.7. PARTICULARS OF PROVISION AGAINST NON-PERFORMING FINANCINGS==========================================================================================================
2005 2004
Specific General Total Specific General Total
Note Rupees in '000
==========================================================================================================
Opening balance 59,971 18,851 78,822 62,192 - 62,192
Transfer to 'available
for sale' investments (30,959) - (30,959) - - -
Charge for the year 37,941 30,870 68,811 2,620 18,851 21,471
Reversals - - - (4,480) - (4,480)
37,941 30,870 68,811 (1,860) 18,851 16,991
Amounts written off 10.8 - - - (361) - (361)
Closing balance 66,953 49,721 116,674 59,971 18,851 78,822
==========================================================================================================10.7.1. During the year, the State Bank of Pakistan has directed banks to classify their non-performing financings and determine provision for doubtful financings in accordance with BSD Circular No 7 dated November 1, 2005.Accordingly, the Bank has classified its non-performing financings and determined provision for doubtful financings in accordance with aforementioned circular. The effect of this change in determination of provision is not considered to be material. 10.7.2. The Bank has maintained a general reserve (provision) in accordance with the applicable requirements of the prudential regulations for consumer financing issued by the State Bank of Pakistan. 10.8. PARTICULARS OF WRITE OFFS 10.8.1. ================================================================================
2005 2004
Note Rupees in '000
================================================================================
Against provision 10.7 - 361
Directly charged to profit and loss account - -
- 361
================================================================================10.8.2.================================================================================
2005 2004
Rupees in '000
================================================================================
Write offs of Rs 500,000 and above - -
Write offs below Rs 500,000 - 361
- 361
================================================================================11. OTHER ASSETS================================================================================
2005 2004
Note Rupees in '000
================================================================================
Profit/ return accrued in local currency 308,282 106,650
Profit/ return accrued in foreign currencies 7,144 1,945
Advances, deposits, advance 203,208 150,044
rent and other prepayments
Advance taxation (payments less provisions) 150,193 187,719
Receivables on account of sale of securities 761,543 318,524
Dividends receivable 765 3,716
Stamps 2,202 1,494
Advance against future murabaha 368,818 325,046
Advances against future ijarah 382,981 247,632
Security deposits 6,208 5,928
Unrealised gain (net) on forward 17,038 -
foreign exchange contracts
Prepaid exchange risk fee 47 42
Other 11.1 1,671 444
2,210,100 1349,184
================================================================================11.1. This represents amount recoverable from the SBP upon encashment of various instruments on behalf of the SBP by the Bank.12. OPERATING FIXED ASSETS ================================================================================
2005 2004
Notes Rupees in '000
================================================================================
TANGIBLE ASSETS:
- Capital work-in-progress 12.1 26,895 12,830
- Property, equipment and others 12.2 265,367 182,767
292,262 195,597
Intangible assets 12.4 13,323 9,140
305,585 204,737
================================================================================12.1. CAPITAL WORK-IN-PROGRESS================================================================================
2005 2004
Rupees in '000
================================================================================
- Advances to suppliers and 15,455 4,792
contractors for building renovation
- Advances for computer hardware 1,806 -
- Advances for purchase of vehicles 3,999 8,038
- Advances for computer software 5,635 -
26,895 12,830
================================================================================12.2. PROPERTY, EQUIPMENT AND OTHERS=============================================================================================================
COST DEPRECIATION
As at Additions/ As at As at Charge/ As at Net book Rate of
January (disposals)December January (on December value as at depre-
1, 2005 31, 2005 1, 2005 disposals) 31, 2005 December ciation
31, 2005 %
Rupees in '000
=============================================================================================================
Land and buildings 55,329 - 55,329 2,766 2,766 5,532 49,797 5
Leasehold improvements 61,021 57,071 118,092 9,400 11,810 21,210 96,882 10
Furniture and fixtures 12,453 13,840 26,293 2,366 2,625 4,991 21,302 10
Electrical, office and
computer equipments 75,999 51,372 126,911 39,852 37,946 77,360 49,551 33
(460) (438)
Vehicles 53,214 29,533 78,288 20,865 12,263 30,453 47,835 20
(4,459) (2,675)
2005 258,016 151,816 404,913 75,249 67,410 139,546 265,367
(4,919) (3,113)
2004 97,973 163,451 258,016 33,337 43,707 75,249 182,767
(3,408) (1,795)
=============================================================================================================12.3. PROPERTY, EQUIPMENT AND OTHERS - MOVEMENT OF NET BOOK VALUE=================================================================================================================
Land and Leasehold Furniture Electrical, Vehicles Total
buildings improvements and fixtures office and
computer
equipments
Rupees in '000
=================================================================================================================
At January 1, 2004
Cost - 26,534 6,155 32,971 32,313 97,973
Accumulated depreciation - 3,298 1,121 16,894 12,024 33,337
Net book value - 23,236 5,034 16,077 20,289 64,636
Year ended December 31, 2004
Additions 55,329 34,487 6,298 43,695 23,642 163,451
Net book value of disposals - - - 412 1,201 1,613
Depreciation charge 2,766 6,102 1,245 23,213 10,381 43,707
52,563 51,621 10,087 36,147 32,349 182,767
Year ended December 31, 2005
Additions - 57,071 13,840 51,372 29,533 151,816
Net book value of disposals - - - 22 1,784 1,806
Depreciation charge 2,766 11,810 2,625 37,946 12,263 67,410
Net book value as at
December 31, 2005 49,797 96,882 21,302 49,551 47,835 265,367
=================================================================================================================12.3.1. The break-up of cost of land and buildings between the two separate categories has not been disclosed as the subject purchase was made for an overall price.12.3.2. Included in cost of property, equipment and others are fully depreciated items still in use aggregating Rs 15.058 million (2004: Rs 6.986 million). 12.3.3. Details of disposal of fixed assets to executives and other persons are as follows: ============================================================================================================
Description Cost Accumulated Net book Sale Mode of Particulars of purchaser
depreciation value proceeds disposal
Rupees in '000
============================================================================================================
ELECTRICAL, OFFICE
AND COMPUTER EQUIPMENTS:
Mobile 14 9 5 5 Bank policy Mr Aqeel Ahmed Siddiqui
(Ex-employee)
Mobile 12 4 8 4 Bank policy Mr Pervez Mobin
(Ex-employee)
Mobile 14 5 9 4 Bank policy Mr Gohar lqbal Sheikh
(Ex-employee)
Fax Machine 76 76 - 5 Trade-in Mansha Brothers
5 - Amber Palm Block-B,
Shahrah-e-Faisal, Karachi
Computers 344 344 - 25 Negotiation Various buyers
VEHICLES:
Honda Civic 955 573 382 509 Bank policy Mr Aqeel Ahmed Siddiqui
(Ex-employee)
Toyota Corolla 1,169 701 468 526 Bank policy Mr Gohar lqbal Sheikh
(Ex-employee)
Suzuki Cultus 555 333 222 231 Bank policy Ms Mehnaz lkram (Employee)
Honda Civic 995 597 398 398 Bank policy Mr Ayaz Wasay (Ex-employee)
Honda City 785 471 314 262 Bank policy Mr M. Rizvi (Employee)
4,919 3,113 1,806 1,969
============================================================================================================12.4. INTANGIBLE ASSETS===================================================================================================================
COST AMORTISATION
As at Additions As at As at Charge As at Net book Rate of
January December January December value as at amortisa-
1, 2005 31, 2005 1, 2005 31, 2005 December tion
31, 2005 %
Rupees in '000
===================================================================================================================
Computer software 10,928 7,514 18,442 1,788 3,331 5,119 13,323 20
2004 5,328 5,600 10,928 695 1,093 1,788 9,140 10
===================================================================================================================12.5. INTANGIBLE ASSETS - MOVEMENT OF NET BOOK VALUE===================================================================================================================
Year ended December 31, 2005 Year ended December 31, 2004
Net book Additions Amortisa- Net book Net book Additions Amortisa- Net book
value as at tion charge value as at value as at tion charge value as at
January 1, for the year December 31, January 1, for the yearDecember 31,
2005 2005 2004 2004
Rupees in '000
===================================================================================================================
Computer software 9,140 7,514 3,331 13,323 4,633 5,600 1,093 9,140
===================================================================================================================13. BILLS PAYABLE================================================================================
2005 2004
Rupees in '000
================================================================================
In Pakistan 260,732 196,145
Outside Pakistan - -
260,732 196,145
================================================================================14. DUE TO FINANCIAL INSTITUTIONS================================================================================
2005 2004
Rupees in '000
================================================================================
In Pakistan 2,981,714 2,862,139
Outside Pakistan - -
2,981,714 2,862,139
================================================================================14.1. PARTICULARS OF DUE TO FINANCIAL INSTITUTIONS================================================================================
2005 2004
Rupees in '000
================================================================================
In local currency 2,922,000 2,835,274
In foreign currencies 59,714 26,865
2,981,714 2,862,139
================================================================================14.2. DETAILS OF DUE TO FINANCIAL INSTITUTIONS================================================================================
2005 2004
Note Rupees in '000
================================================================================
SECURED:
Under Islamic export refinance scheme 14.2.1 2,922,000 2,665,274
UNSECURED:
Call borrowing - 170,000
Others 59,714 26,865
2,981,714 2,862,139
================================================================================14.2.1. These borrowings are on a profit and loss sharing basis maturing between January 2 to June 28, 2006 and are secured against demand promissory notes executed in favour of the SBP.A limit of Rs 4,500 million has been allocated to the Bank by the SBP under Islamic export refinance scheme for the financial year ending June 30, 2006. 15. DEPOSITS AND OTHER ACCOUNTS ================================================================================
2005 2004
Rupees in '000
================================================================================
CUSTOMERS:
- Fixed deposits schemes 6,492,676 4,628,446
- Savings deposits 7,500,017 5,113,127
- Current accounts - non-remunerative 5,028,807 3,134,172
- Margin 207,290 90,675
19,228,790 12,966,420
FINANCIAL INSTITUTIONS:
- Remunerative deposits 3,534,865 784,038
- Non-remunerative deposits 5,607 19,349
3,540,472 803,387
22,769,262 13,769,807
================================================================================15.1. PARTICULARS OF DEPOSITS================================================================================
2005 2004
Rupees in '000
================================================================================
IN:
- local currency 21,605,754 12,914,624
- foreign currencies 1,163,508 855,183
22,769,262 13,769,807
================================================================================16. OTHER LIABILITIES================================================================================
2005 2004
Notes Rupees in '000
================================================================================
RETURN ON DEPOSITS AND OTHER DUES:
- payable in local currency 16.1 171,182 76,211
- payable in foreign currencies 1,436 818
Unearned commission 11,869 7,803
Accrued expenses 16.2 51,000 23,260
Advance payments 7,720 10,879
Unclaimed dividends 855 862
Unrealised loss (net) on forward
foreign exchange contracts - 1,184
Payable to defined benefit plan 32.3 5,627 6,530
Provision against off-balance
sheet obligations 16.3 1,600 1,600
Security deposits against ijarah 885,628 480,863
Payable on account
of purchase of securities 149,552 64,449
Other staff benefits 108,361 64,373
Others 16.4, 16.5 & 16.6 74,428 31,799
1,469,258 770,631
================================================================================16.1. It includes Rs 49.006 million (2004: Rs 10.357 million) in respect of return accrued on borrowings from the SBP under the Islamic export refinance scheme.16.2. It includes Rs 7.4 million payable to a subsidiary. 16.3. PROVISION AGAINST OFF-BALANCE SHEET OBLIGATIONS ================================================================================
2005 2004
Note Rupees in '000
================================================================================
Opening balance 16.3.1 1,600 1,600
Charge for the year - -
Reversals - -
Amount written off - -
Closing balance 1,600 1,600
================================================================================16.3.1. This represents provision made against a bail bond issued on behalf of former employees of Societe Generale, The French and International Bank in a suit pending before a court.16.4. It includes charity payable aggregating Rs 6.740 million (2004: Rs 2.889 million). Charities amounting to Rs 0.5 million and Rs 0.649 million during the year ended December 31, 2005 were paid to the The Citizen Foundation and Alamgir Welfare Trust respectively. None of the other individuals received charity in excess of Rs 100,000 each. Charity and donation were not paid to any individual / organisation in which a director or his spouse had any interest at any time during the year. 16.5. It includes donation payable aggregating Rs 4 million for relief efforts for earthquake victims. 16.6 It includes amounts aggregating Rs 2.700 million and Rs 1 million which the Bank had earned from murabaha financings and income from dealing in foreign currencies respectively. These incomes have not been recognised as income on the directives of Bank's Shariah Advisor pending a detail review of the underlying transactions by the Shariah Supervisory Board. The related incomes may not be in accordance with the principles of Islamic Shariah. 17. DEFERRED TAXATION ================================================================================
2005 2004
Notes Rupees in '000
================================================================================
(DEBIT) / CREDIT BALANCES ARISING ON ACCOUNT OF:
Excess of tax written down values
over accounting net book values
of owned assets 2,919 1,397
Other staff benefits (37,926) (24,461)
Excess of ijarah financings over tax
written down values of ijarah assets 253,400 113,504
Carried forward unassessed tax losses (29,480) (86,284)
Excess of tax written down values over
accounting net book values of investments (2,609) (2,404)
Provision against non-performing financings (14,070) (858)
Others (1,960) (608)
170,274 286
Payable to defined benefit plan 32.3 5,627 6,530
Provision against off-balance 1,600 1,600
sheet obligations 16.3
Security deposits against ijarah 885,628 480,863
Payable on account of
purchase of securities 149,552 64,449
Other staff benefits 108,361 64,373
Others 16.4, 16.5 & 16.6 74,428 31,799
1,469,258 770,631
================================================================================17.1. The Bank has an aggregate amount of Rs 84.229 million (2004: 227.063 million) available as carried forward unassessed tax losses as at December 31, 2005.The management is confident that sufficient taxable profits will be available in the future against which these tax losses shall be offset. Accordingly, the full amount of carried forward tax losses has been considered in calculating the deferred tax balance. 18. SHARE CAPITAL 18.1. AUTHORISED, ISSUED, SUBSCRIBED AND PAID-UP CAPITAL A summary of the movement on ordinary share capital is given below: ================================================================================
Ordinary shares
Number Amount
Rupees in '000
================================================================================
AUTHORISED CAPITAL:
As at January 1, 2005 200,000,000 2,000,000
Increase during the year 100,000,000 1,000,000
As at December 31, 2005 300,000,000 3,000,000
ISSUED CAPITAL:
As at January 1, 2004 106,404,514 1,064,045
Ordinary shares of Rs 10 each 28,197,195 281,972
issued as bonus shares
Right issue at Rs 10 each 35,113,489 351,135
As at December 31, 2004 169,715,198 1,697,152
Right issue at Rs 10 each 33,943,039 339,430
As at December 31, 2005 203,658,237 2,036,582
Subscribed and paid-up capital
as at January 1, 2004 106,404,514 1,064,045
Issue of bonus shares 28,197,195 281,972
As at December 31, 2004 134,601,709 1,346,017
Right issue at Rs 10 each 69,056,528 690,565
As at December 31, 2005 203,658,237 2,036,582
================================================================================18.2. The Bank intends to issue 9.9 million ordinary shares of Rs 10 each having a face value of Rs 99 million under an employee stock option plan.19. CAPITAL RESERVES ================================================================================
2005 2004
Note Rupees in '000
================================================================================
Statutory reserve 19.1 340,469 256,578
Reserve for issue of bonus shares 325,853 -
666,322 256,578
================================================================================19.1. Under section 21 of the Banking Companies Ordinance, 1962 an amount not less than 20% of the profit is to be transferred to create a reserve fund till such time the reserve fund and the share premium account equal the amount of the paid up capital.20. REVENUE RESERVES ================================================================================
2005 2004
Rupees in '000
================================================================================
General reserve 66,766 66,766
Unappropriated profit 201,270 191,559
268,036 258,325
================================================================================21. SURPLUS ON REVALUATION OF INVESTMENTS================================================================================
2005 2004
Rupees in '000
================================================================================
Quoted shares 50,772 40,866
Other securities (Quoted MTFCs) 2,870 4,284
53,642 45,150
================================================================================22. CONTINGENCIES AND COMMITMENTS22.1. DIRECT CREDIT SUBSTITUTES ================================================================================
2005 2004
Rupees in '000
================================================================================
Government 82,298 66,587
================================================================================22.2. TRANSACTION RELATED CONTINGENT LIABILITIES================================================================================
2005 2004
Rupees in '000
================================================================================
GUARANTEES FAVOURING:
- Government 1,851,267 2,188,156
- Banks 18,397 32,717
- Others 1,224,058 714,812
3,093,722 2,935,685
================================================================================22.3. TRADE RELATED CONTINGENT LIABILITIES================================================================================
2005 2004
Rupees in '000
================================================================================
Import letters of credit 5,880,513 2,880,866
Acceptances 2,242,686 1,236,296
8,123,199 4,117,162
================================================================================22.4. While finalising the issues set aside by CIT, Appeals under order No Jud-11/R.P/cos-1/2000-2001/1415 for the income year ended June 30, 2001 (assessment year 2001 -2002) the assessing officer has subjected to tax the gain on foreign currency deposits claimed as exempt in the return of income.The Bank has filed an appeal in Income Tax Appellate Tribunal (ITAT). The matter is pending hearing in the tribunal. The amount of tax levied by the assessing officer on such gain aggregated Rs 141.689 million, whereas the net tax liability for the aforesaid assessment year and other relevant assessment years after considering relief for the related expenditure amounts to approximately Rs 41 million. The management is confident that the ultimate outcome of the appeal would be in favour of the Bank especially for the reason that the State Bank of Pakistan through its letter No 6226/Sec-296-2001 dated October 3, 2001 has confirmed that the assessee's deposits were covered under the Protection of Economic Reforms Act, 1992. Accordingly, no provision has been recognised in the financial statements in this regard. 22.5. ================================================================================
2005 2004
Rupees in '000
================================================================================
Commitments in respect of Financings 13,417,146 10,754,024
================================================================================22.6. COMMITMENTS IN RESPECT OF FORWARD EXCHANGE CONTRACTS================================================================================
2005 2004
Rupees in '000
================================================================================
Purchases 1,908,163 573,145
Sales 4,641,603 1,808,208
================================================================================22.7. OTHER COMMITMENTS================================================================================
2005 2004
Rupees in '000
================================================================================
Bills for collection (inland) 16,108 32,249
Bills for collection (foreign) 1,146,365 934,538
1,162,473 966,787
================================================================================23. PROFIT / RETURN ON FINANCINGS, INVESTMENTS AND PLACEMENTS EARNED================================================================================
2005 2004
Note Rupees in '000
================================================================================
ON FINANCINGS TO:
- Customers 1,422,098 513,397
- Financial institutions - -
On investments in
- 'Held to maturity' securities 23.1 6,667 1,639
- 'Available for sale' securities 3,066 5,327
On deposits with financial institutions 27,398 14,037
1,459,229 534,400
================================================================================23.1. It represents return on investments made in Qatar and Dubai Global Sukuk Bonds.24. RETURN ON DEPOSITS AND OTHER DUES EXPENSED ================================================================================
2005 2004
Note Rupees in '000
================================================================================
Deposits 24.1 520,946 195,549
Other short term borrowings 169,472 54,844
690,418 250,393
================================================================================24.1. It includes Rs 144.02 million (2004: Rs 34.38 million) paid to SBP under Islamic export refinance scheme.25. OTHER INCOME ================================================================================
2005 2004
Rupees in '000
================================================================================
Gain on sale of shares in a subsidiary company - 450
Gain on termination of ijarah financings 9,186 3,897
Gain on sale of property, equipment and others 163 704
Others 328 577
9,677 5,628
================================================================================26. ADMINISTRATIVE EXPENSES================================================================================
2005 2004
Notes Rupees in '000
================================================================================
Salaries, allowances, etc. 294,177 160,338
Charge for defined benefit plan 32.4 5,627 3,641
Contribution to defined contribution plan 7,776 4,606
Directors' fees 33 7,943 8,824
Rent, taxes, insurance, electricity, etc. 79,140 41,422
Insurance on consumer car ijarah 58,862 21,018
Communication 32,386 19,753
Stationery and printing 20,998 15,400
Entertainment 6,576 2,689
Local transportation and car running 15,806 8,162
Clearing charges and subscription fees 3,857 7,128
Security charges 7,439 3,646
Repairs and maintenance 6,699 3,435
Hardware and software maintenance 3,813 2,760
Advertisement and publicity 30,294 21,816
Depreciation 12.2 67,410 43,707
Amortisation 12.4 3,331 1,093
Travelling 7,195 5,785
Service charges 33.2 13,892 13,175
Portfolio management fee 26.1 9,568 559
Brokerage and commission 9,660 4,655
Legal and professional charges 8,876 5,345
Auditors' remuneration 26.2 5,360 4,925
Donations 16.5 4,000 -
Others 7,699 5,414
718,384 409,296
================================================================================26.1. This represents fee paid to a subsidiary for the management of investment portfolio of the Bank.26.2. AUDITORS' REMUNERATION ================================================================================
2005 2004
Rupees in '000
================================================================================
Audit fee 950 850
Fee for audit of employees' funds 75 75
Tax services 2,253 1,304
Special certifications and sundry advisory services 1,892 2,566
Out of pocket expenses 190 130
5,360 4,925
================================================================================27. OTHER CHARGES================================================================================
2005 2004
Rupees in '000
================================================================================
Penalties imposed by the SBP 482 185
================================================================================28. TAXATION================================================================================
2005 2004
Rupees in '000
================================================================================
- Current - for the year 4,671 5,470
- for prior years 39,002 -
43,673 5,470
- Deferred 169,988 (8,950)
213,661 (3,480)
================================================================================28.1. As the provision for current taxation for the year ended December 31, 2005 has been made on the basis of presumptive tax, therefore a relationship between the tax expense and the accounting profit has not been disclosed.29. BASIC EARNINGS PER SHARE ================================================================================
Note 2005 2004
================================================================================
Profit for the year (Rupees in '000) 419,455 224358
Weighted average number of ordinary shares 184,024,464 164,303,450
Basic earnings per share (Rupees) 29.1 2.28 1.37
================================================================================29.1. The number of ordinary share as at December 31, 2004 has been adjusted for element of bonus in issue of right shares.29.2. There were no convertible dilutive potential ordinary shares outstanding on December 31, 2005 and 2004. 30. CASH AND CASH EQUIVALENTS ================================================================================
2005 2004
Notes Rupees in '000
================================================================================
Cash and balances with treasury banks 7 3,956,938 2,623,588
Balances with other banks 8 2,855,823 1,751,083
6,812,761 4,374,671
================================================================================31. STAFF STRENGTH================================================================================
2005 2004
================================================================================
Total number of employees, including 105 (2004: 73)
contracted employees at the year's end 786 511
================================================================================32. DEFINED BENEFIT PLAN32.1. PRINCIPAL ACTUARIAL ASSUMPTIONS ================================================================================
2005 2004
================================================================================
Discount rate 10% p.a 9% p.a
Expected rate of increase in salaries 10% p.a 9% p.a
Expected rate of return on investments 10% p.a 9% p.a
Normal retirement age 60 years 60 years
================================================================================32.2. RECONCILIATION OF AMOUNT PAYABLE TO DEFINED BENEFIT PLAN================================================================================
2005 2004
Note Rupees in '000
================================================================================
Present value of defined benefit obligations 17,640 10,972
Fair value of plan assets 32.6 (6,841) (1,956)
Net actuarial losses not recognised (5,172) (2,486)
5,627 6,530
================================================================================32.3. MOVEMENT IN PAYABLE TO DEFINED BENEFIT PLAN================================================================================
2005 2004
Note Rupees in '000
================================================================================
Opening balance 6,530 2,889
Charge for the year 32.4 5,627 3,641
Contribution made during the year (6,530) -
Closing balance 5,627 6,530
================================================================================32.4. CHARGE FOR DEFINED BENEFIT PLAN================================================================================
2005 2004
Rupees in '000
================================================================================
Current service cost 4,700 3,126
Interest cost 987 513
Expected return on plan assets (176) (135)
Actuarial losses 116 137
5,627 3,641
================================================================================32.5.================================================================================
2005 2004
Rupees in '000
================================================================================
Actual (loss) / return on plan assets (380) 473
================================================================================32.6. It includes a balance of Rs 6.501 million (2004: Rs 1.223 million) kept in a saving account with the Bank.33. REMUNERATION OF THE PRESIDENT AND CHIEF EXECUTIVE, DIRECTORS AND EXECUTIVES The amounts charged in these financial statements are as follows: =========================================================================================================
President and Chief Executive Directors Executives
2005 2004 2005 2004 2005 2004
Rupees in '000
=========================================================================================================
Fees 923 899 7,020* 7,925 - -
Managerial remuneration 16,086 8,945 18,764 12,116 48,456 27,673
Charge for defined benefit plan - - 617 513 1,790 1,327
Contribution to defined contribution - - 741 615 2,118 1,517
House rent - - 270 135 6,606 2,601
Utilities - - 741 615 2,484 1,816
Medical 176 69 846 723 2,619 2,059
Conveyance 537 506 145 259 - -
Leave fare assistance - - - 138 - -
Others 143 218 14 128 - 788
17,865 10,637 29,158 23,167 64,073 37,781
Number of persons 1 1 10 10 26 20
========================================================================================================= * This includes amounts charged in these financial statements as fees to nine (2004: nine) non-executive directors.33.1. CERTAIN EXECUTIVES ARE PROVIDED WITH FREE USE OF THE BANK CARS 33.2. In addition to the above, service charges (note 26) include Rs 13.892 million (2004: Rs 12.997 million) in respect of reimbursement, to a related party, of salary and other benefits paid by that related party to the chief executive as he is on secondment from that related party. 34. MATURITIES OF ASSETS AND LIABILITIES =========================================================================================================
Category of classification 2005
Total Upto three Over three Over one Over five
months months to year to years
one year five years
Note Rupees in '000
=========================================================================================================
ASSETS:
Cash and balances with treasury banks 3,956,938 3,956,938 - - -
Balances with other banks 2,855,823 2,855,823 - - -
Investments 1,606,490 385,804 180,657 135,404 904,625
Financings 19,740,886 8,132,987 5,078,199 3,657,980 2,871,720
Other assets 2,210,100 2,203,892 - - 6,208
Operating fixed assets 305,585 - - - 305,585
30,675,822 17,535,444 5,258,856 3,793,384 4,088,138
LIABILITIES:
Bills payable 260,732 260,732 - - -
Due to financial institutions 2,981,714 2,048,939 932,775 - -
Deposits and other accounts 34.1 22,769,262 18,617,451 1,789,752 2,362,059 -
Other liabilities 1,469,258 488,806 187,101 724,954 68,397
Deferred taxation 170,274 - - 170,274 -
27,651,240 21,415,928 2,909,628 3,257,287 68,397
Net assets 3,024,582 (3,880,484) 2,349,228 536,097 4,019,741
Share capital 2,036,582
Capital reserves 666,322
Revenue reserves 268,036
Surplus on revaluation of investments 53,642
3,024,582
=========================================================================================================34.1. Current and savings deposits have been classified under maturity upto three months as these do not have any contracted maturity.Further, the Bank estimates that these deposits are a core part of its liquid resources and will not fall below the current year's level. 35. YIELD / PROFIT RATE RISK Yield / profit rate sensitivity position for on-balance sheet instruments is based on the earlier of contractual repricing or maturity date and for off-balance sheet instruments is based on settlement date. ========================================================================================================================
2005
Effective Total Exposed to yield/ profit risk Not exposed
Yield/ Upto three Over three Over one Over five to yield /
profit rate months months to year to years profit risk
one year five years
Rupees in '000
========================================================================================================================
ON-BALANCE SHEET FINANCIAL
INSTRUMENTS
ASSETS:
Cash and balances with
treasury banks - 3,956,938 - - - - 3,956,938
Balances with other banks 4.08 2,855,823 1,941,735 - - - 914,088
Investments 5.61 1,606,490 - 10,098 10,404 179,142 1,406,846
Financings 10.60 19,740,886 8,130,727 5,068,477 3,628,993 2,828,196 84,493
Other assets - 1,856,652 - - - - 1,856,652
30,016,789 10,072,462 5,078,575 3,639,397 3,007,338 8,219,017
LIABILITIES:
Bills payable - 260,732 - - - - 260,732
Due to financial institutions 7.52 2,981 ,714 2,048,939 932,775 - - -
Deposits and other accounts 3.84 22,769,262 13,375,747 1,789,752 2,362,059 - 5,241,704
Other liabilities - 558,414 - - - - 558,414
26,570,122 15,424,686 2,722,527 2,362,059 - 6,060,850
On-balance sheet gap 3,446,667 (5,352,224) 2,356,048 1,277,338 3,007,338 2,158,167
Non-financial assets 659,033
Non-financial liabilities (1,081,118)
Total net assets 3,024,582
OFF-BALANCE SHEET
FINANCIAL INSTRUMENTS:
Forward endings - - - - - -
Forward borrowings - - - - - -
Off-balance sheet gap - - - - - -
Total yield / profit risk sensitivity gap (5,352,224) 2,356,048 1,277,338 3,007,338
Cumulative yield/ profit risk sensitivity gap (5,352,224) (2,996,176) (1,718,838) 1,288,500
========================================================================================================================Yield risk is the risk of decline in earnings due to adverse movement of the yield curve.Profit rate risk is the risk that the value of the financial instruments will fluctuate due to changes in the market profit rates. 36. CURRENCY RISK =============================================================================
2005
Assets Liabilities Off-balance Net foreign
sheet items currency
exposure
Rupees in '000
=============================================================================
Pakistan rupees 25,932,340 25,345,464 2,740,589 3,327,465
United States dollars 3,807,012 1,053,679 (2,661,500) 91,833
Great Britain pounds 101,965 76,772 - 25,193
Japanese yen 4,632 - (3,806) 826
Euro 165,511 94,207 (75,283) (3,979)
Singapore dollars 1,009 - - 1,009
Australian dollars 2,452 - - 2,452
Canadian dollars 849 - - 849
Swiss francs 1,019 - - 1,019
30,016,789 26,570,122 - 3,446,667
=============================================================================The currency risk is the risk that the value of a financial instrument will fluctuate due to changes in foreign exchange rates.The Bank does not take any currency exposure except to the extent of statutory net open position prescribed by the SBP. Foreign exchange open and mismatch positions are controlled through internal limits and are marked to market on a daily basis to contain forward exposures. 37. FAIR VALUE OF FINANCIAL INSTRUMENTS The fair value of investments in listed securities, except investments categorised as 'held to maturity' securities and investments in subsidiaries and associates is based on quoted market prices. The value of unquoted equity investments is reduced, if required, on the basis of break-up value of those investments based on the latest available financial statements as disclosed in notes 9.6 and 9.8. The fair value of financings, other assets, other liabilities and deposits and other accounts cannot be calculated with sufficient reliability due to absence of current and active market for such assets and liabilities and reliable data regarding market rates for similar instruments. The provision for impairment of financings has been calculated in accordance with the Bank's accounting policy as stated in note 6.3. In the opinion of the management, the fair value of the remaining financial assets and liabilities are not significantly different from their carrying values as these assets and liabilities are either short term in nature or in the case of financings and deposits are frequently repriced. 38. CONCENTRATION OF CREDIT AND DEPOSITS Credit risk represents the accounting loss that would be recognised at the reporting date if counter parties failed completely to perform as contracted. Out of the total financial assets of Rs 30.017 billion, the financial assets which were subject to credit risk amounted to Rs 26.060 billion. However, the Bank does not believe that it is exposed to major concentration of credit risk. The Bank manages its exposure to credit risk by portfolio diversification and adequate collateral, wherever applicable. The Bank has well-defined credit structure duly approved by the Board of Directors, under which delegated authorities at various levels are operating which critically scrutinise and sanction financings. The emphasis is to provide short to medium term trade related financing to reputable names which are self-liquidating and Shariah compliant. The risk appraisal system of the Bank has enabled it to build a sound portfolio. The Bank has developed a system to monitor problem accounts so that instant instructions based on early warning signals are passed on to units to deal with potential problem accounts. 38.1. SEGMENT BY CLASS OF BUSINESS ====================================================================================================================
2005 Contingencies and
Financings Deposits commitments
Rupees Percent Rupees Percent Rupees Percent
in '000 in '000 in '000
====================================================================================================================
Chemical and pharmaceuticals 566,261 2.87% 299,517 1.32% 3,527,715 10.87%
Agribusiness - - 139,216 0.61% 366,711 1.13%
Textile 6,153,918 31.17% 592,740 2.60% 9,045,523 27.86%
Cement 2,404 0.01% 15,320 0.07% 62,587 0.19%
Sugar 822,842 4.17% 13,723 0.06% 686,149 2.11%
Shoes and leather garments 888,119 4.50% 38,146 0.17% 1,120,349 3.45%
Automobile and transportation
equipment 736,566 3.73% 102,353 0.45% 1,228,349 3.78%
Financial 50,000 0.25% 3,540,472 15.55% 6,676,914 20.56%
Insurance - - 37,086 0.16% - -
Electronics and
electrical appliances 154,168 0.78% 7,728 0.03% 976,307 3.01%
Production and transmission
of Energy 227,316 1.15% 518,299 2.28% 415,160 1.28%
Construction 850,503 4.31% 336,712 1.48% - -
Individuals 4,655,511 23.59% 9,620,204 42.25% 129,216 0.40%
Others 4,633,278 23.47% 7,507,746 32.97% 8,234,624 25.36%
19,740,886 100.00% 22,769,262 100.00% 32,469,604 100.00%
====================================================================================================================38.2. SEGMENT BY SECTOR==========================================================================================================
2005 Contingencies and
Financings Deposits commitments
Rupees Percent Rupees Percent Rupees Percent
in '000 in '000 in '000
==========================================================================================================
Public / Government - - 301,339 1.32% - -
Private 19,740,886 100.00% 22,467,923 98.68% 32,469,604 100.00%
19,740,886 100.00% 22,769,262 100.00% 32,469,604 100.00%
==========================================================================================================39. GEOGRAPHICAL SEGMENT ANALYSIS=======================================================================================
2005
Contingencies
Profit before Total assets Net assets and
taxation employed employed commitments
Rupees in '000
=======================================================================================
Pakistan 633,116 30,675,822 3,024,582 32,469,604
Asia Pacific (including South Asia) - - - -
Europe - - - -
United States of America and Canada - - - -
Middle East - - - -
Others - - - -
633,116 30,675,822 3,024,582 32,469,604
=======================================================================================40. RELATED PARTY TRANSACTIONS40.1. Parties are considered to be related if one party has the ability to control the other party or exercise significant influence over the other party in making financial or operational decisions and include a subsidiary company, associated companies with or without common directors, retirement benefit funds, directors, and key management personnel. 40.2. A number of banking transactions are entered into with related parties in the normal course of business. These include loans, deposits and foreign currency transactions. These transactions were carried out on commercial terms and at market rates. The service charges relating to secondment are on actual basis. 40.3. SUBSIDIARY COMPANY -- Al Meezan Investment Management Limited 40.4. KEY MANAGEMENT PERSONNEL -- President and Chief Executive Officer -- Chief Operating Officer 40.5. The volumes of related party transactions, outstanding balances at the year end, and related expense and income for the year are as follows: ==========================================================================================================================================================
Total Subsidiary Associates Key management Other related
personnel parties
2005 2004 2005 2004 2005 2004 2005 2004 2005 2004
Rupees in '000
==========================================================================================================================================================
FINANCINGS:
At January 1, 148,269 100,000 1,352 - 146,917 100,000 - - - -
Disbursed during the year 697,089 246,579 1,877 1,470 695,212 245,109 - - - -
Repaid during the year (531,259) (198,310) (1,042) (118) (530,217) (198,192) - - - -
At December 31 314,099 148,269 2,187 1,352 311,912 146,917 - - - -
DEPOSITS:
At January 1, 1,259,319 452,650 24,100 8,495 583,923 162,940 23,35 11,415 627,942 269,800
Deposited during the year 34,125,701 24,057,966 410,569 380,430 20,057,083 8,574,710 54,92 51,804 13,603,124 15,051,022
Repaid during the year (33,744,088) (23,251,297) (426,693) (364,825) (19,246,488) (8,153,727) - (61,127) (39,865) (14,009,780) (14,692,880)
At December 31, 1,640,932 1,259,319 7,976 24,100 1,394,518 583,923 17,152 23,354 221,286 627,942
BALANCES:
Bank balance - 4,715 - - - 4,715 - - - -
Profit receivable on financings 1,640 503 622 95 1,018 408 - - - -
Service charges payable
by the Bank 7,380 75 7,380 75 - - - - - -
Acceptances 22,112 57,714 - - 22,112 57,714 - - - -
Letters of credit (unfunded) 243,283 180,890 - - 243,283 180,890 - - - -
TRANSACTIONS, INCOME
AND EXPENSES:
Profit earned on financings 13,934 2,599 709 95 13,225 2,504 - - - -
Profit earned on a bank account - 5,560 - - - 5,560 - - - - -
Fees earned 9,603 5,722 9,603 5,722 - - - - - - -
Commission earned on
letters of credit
and acceptances 1,815 892 - - 1,815 892 - - - -
Dividend income earned 46,956 44,747 - 13,000 46,956 31,747 - - - -
Dividend paid - 31,295 - - - - - 1,854 - 29,441
Return on deposits expensed 54,667 15,841 536 563 43,226 6,535 926 581 9,979 8,162
Service charges incurred 23,460 13,734 9,568 559 - 177 - - 13,892 12,998
==========================================================================================================================================================41. ASSOCIATES - KEY INFORMATION==============================================================
PARTICULARS MUTUAL FUNDS OTHERS TOTAL
Rupees in '000
==============================================================
Assets 6,740,421 2,467,193 9,207,614
Liabilities 286,411 620,244 906,655
Operating revenue 2,111,874 322,286 2,434,160
Profit after tax 2,137,182 105,354 2,242,536
==============================================================42. CORRESPONDING FIGURESCorresponding figures of the following has been reclassified for the purposes of comparison Insurance on consumer car ijarah previously included in 'Rent, taxes, insurance, electricity, etc' has been shown separately in administrative expenses, musharakah financings has been further classified as diminishing musharakah financings housing, diminishing musharakah financings - others and musharakah financings, and financings against bills has been further classified as financings against bills - salam and financings against bills - murabaha, 43. DATE OF AUTHORISATION These financial statements were authorised for issue on March 9, 2006 by the Board of Directors of the Bank. |