Meezan Bank

The Premier Islamic Bank

Best Bank
ettrs in Pakistan 2020

Recognized by
Pakistan Banking Awards

FORM-7

April 18, 2024 MEBL/CS/PSX-19/047/2024

The General Manager

Pakistan Stock Exchange Limited
Stock Exchange Building
Stock Exchange Road
Karachi.

Dear Sir,

FINANCIAL RESULTS FOR THE QUARTER ENDED MARCH 31, 2024

We have to inform you that the Board of Directors of our Bank in their meeting held on April 18, 2024 at
10:00 a.m. (PST) at Karachi, Pakistan, recommended the following

i. CASH DIVIDEND

An interim Cash Dividend for the quarter ended March 31, 2024 at Rs 7/- per share i.e. 70%. This is in
addition to interim Dividend(s) already paid at Rs. NIL per share i.e. NIL%.

AND/OR
ii. BONUS SHARES

It has been recommended by the Board of Directors to issue Bonus Shares in the proportion of NIL
share(s) for every NIL share(s) held i.e. NIL %. This is in addition to the interim Bonus Shares already
issued @ NIL.
AND/OR
iii. RIGHT SHARES

The Board has recommended to issue NIL % Right Shares at par/at a discount / premium of Rs. NIL per
shares in proportion of NIL share(s) for every NIL share(s). The entitlement of right shares being declared
simultaneously will be / will not be applicable on Bonus Shares as declared above.

AND/OR

iv. ANY OTHER ENTITLEMENT/CORPORATE ACTION

NIL

AND/OR
v. ANY OTHER PRICE-SENSITIVE INFORMATION

NIL

Meezan Bank Ltd. Page No. 1

Head Office: Meezan House, C-25, Estate Avenue, SITE, Karachi - Pakistan.
PABX: (92-21) 38103500 UAN: 111-331-331 & 111-331-332 www.meezanbank.com
 Reference: Letter No. MEBL'CS/PSX-19/047/2024 dated Apri118, 2024

The unconsolidated and consolidated financial results of the Bank for the quarter ended
March 31, 2024 are enclosed as Annexures "A, B and C" to this letter.

The above entitlement will be paid to the shareholders whose names will appear in the Register of
Members on April 30, 2024.
The Share Transfer Books of the Bank will be closed from May 1, 2024 to May 3, 2024 (both days
inclusive). Transfers received at our Shares Registrar, M/s. THK Associates (Pvt.) Ltd., Plot
No. 32-C, Jami Commercial Street 2, D.H.A Phase VII, Karachi, 75500, Pakistan, at the close of
business on April 30, 2024 will be treated in time for the purpose of above entitlement to the
transferees.
The Quarterly Report of the Bank for the period ended March 31, 2024 will be transmitted through
PUCARS separately, within the specified time.

Yours truly,

Company Secretary

Cc:
Executive Director/HOD,
Offsite-II Department,
Supervision Division,
Securities & Exchange Commission of Pakistan,
63, NIC Building, Jinnah Avenue, Blue Area,
Islamabad.

Ends. As above

Page No. 2
 Annexure "A"
Reference: Letter No. MEBUCS/PSX-19/047/2024
dated April 18, 2024
MEEZAN BANK LIMITED
CONDENSED INTERIM UNCONSOLIDATED PROFIT AND LOSS ACCOUNT (UNAUDITED)
FOR THE QUARTER ENDED MARCH 31, 2024

Note Quarter Quarter

ended ended
March 31, March 31,
2024 2023
--------(Rupees in '000)
Profit / return earned on Islamic financing and related assets,
investments and placements 24 119,145,992 81,952,946
Profit / return on deposits and other dues expensed 25 51,581,860 40,907,273
Net profit / return 67,564,132 41,045,673

OTHER INCOME

Fee and Commission Income 26 5,048,904 3,598,109

Dividend income 442,647 241,252
Foreign Exchange Income / (Loss) 477,930 (155,042)
Gain / (loss) on securities 27 60,100 (105,717)
Net gains on derecognition of financial assets measured
at amortised cost
Other income 28 327,973 286,882
Total other income 6,357,554 3,865,484

Total income 73,921,686 44,911,157

OTHER EXPENSES

Operating expenses 29 19,956,911 14,344,691

Workers Welfare Fund 1,118,616 589,508
Other charges 30 132,596 2,828
Total other expenses 21,208,123 14,937,027

Profit before credit loss allowance / provisions 52,713,563 29,974,130

Credit loss allowance / provisions / reversals and write offs - net 31 (344,143) 2,129,887

Extra ordinary / unusual items

PROFIT BEFORE TAXATION 53,057,706 27,844,243

Taxation 32 27,650,918 12,420,072

PROFIT AFTER TAXATION 25,406,788 15,424,171

Rupees

Basic earnings per share 33 14.18 8.62

Diluted earnings per share 34 14.12 8.61

The annexed notes 1 to 42 form an integral part of this condensed interim unconsolidated financial information.

Chairman President and Director Director Chief Financial Officer

Chief Executive

Page No. 3
 Annexure "B"
MEEZAN BANK LIMITED Reference: Letter No. MEBUCS/PSX-19/047/2024
CONDENSED INTERIM CONSOLIDATED PROFIT AND LOSS ACCOUNT (UNAUDITED) dated April 18, 2024
FOR THE QUARTER ENDED MARCH 31, 2024

Quarter ended Quarter ended

March 31, March 31,
2024 2023
----- Rupees in '000----------

Profit / return earned on Islamic financing and related

assets, investments and placements 119,145,320 81,988,469
Profit on deposits and other dues expensed 51,588,995 40,920,804
Net profit / return 67,556,325 41,067,665

OTHER INCOME
Fee and commission income 5,914,978 4,044,864
Dividend income 182,647 111,252
Foreign Exchange Income / (Loss) 477,930 (155,042)
Gain / (loss) on securities 60,100 (92,060)
Net gains on derecognition of financial assets measured
at amortised cost
Other income 329,270 286,674
Total other income 6,964,925 4,195,688

Total income 74,521,250 45,263,353

OTHER EXPENSES

Operating expenses 20,598,165 14,519,265

Workers Welfare Fund 1,128,469 595,835
Other charges 132,596 2,828
Total other expenses 21,859,230 15,117,928
52,662,020 30,145,425
Share of profit of associates 374,589 26,463
Profit before credit loss allowance / provisions 53,036,609 30,171,888

Credit loss allowance / provisions and write offs - net (344,143) 2,129,887

Extra ordinary / unusual items

PROFIT BEFORE TAXATION 53,380,752 28,042,001

Taxation 27,836,462 12,515,818

PROFIT AFTER TAXATION 25,544,290 15,526,183

Attributable to:
Shareholders of the Holding company 25,420,400 15,446,339
Non-controlling interest 123,890 79,844
25,544,290 15,526,183

Rupees

Basic earnings per share 14.19 8.63

Diluted earnings per share 14.13 8.63

The annexed notes 1 to 3 form an integral part of this condensed interim consolidated financial information.

Chairman President & Chief Executive Directory Director Chief Financial Officer

Page No. 4
 Annexure - C
Reference: Letter No. MEBL/CS/PSX-19/047/2024
dated April 18, 2024

MEEZAN BANK LIMITED

FINANCIAL STATEMENT
FOR THE QUARTER ENDED MARCH 31, 2024
 MEEZAN BANK LIMITED

UNCONSOLIDATED FINANCIAL STATEMENT

FOR THE QUARTER ENDED MARCH 31, 2024
 1
MEEZAN BANK LIMITED
CONDENSED INTERIM UNCONSOLIDATED STATEMENT OF FINANCIAL POSITION
AS AT MARCH 31, 2024

Note March 31, December 31,

2024 2023
(Unaudited) (Audited)
-----------------------(Rupees in '000)-----------------------
ASSETS

Cash and balances with treasury banks 6 231,685,428 242,611,556

Balances with other banks 7 13,380,314 11,452,256
Due from financial institutions 8 34,964,299 34,964,299
Investments 9 1,626,292,181 1,572,387,620
Islamic financing and related assets 10 896,555,304 961,673,012
Property and equipment 11 41,907,890 39,046,484
Right-of-use assets 12 19,549,123 19,571,852
Intangible assets 13 2,178,416 2,271,709
Deferred tax asset - -
Other assets 14 176,142,015 128,129,969
Total Assets 3,042,654,970 3,012,108,757

LIABILITIES

Bills payable 15 39,338,264 39,724,176

Due to financial institutions 16 332,839,285 377,494,612
Deposits and other accounts 17 2,270,071,554 2,217,473,924
Lease liability against right-of-use assets 18 22,581,997 22,093,855
Sub-ordinated sukuk 19 20,990,000 20,990,000
Deferred tax liabilities 20 2,167,827 4,213,492
Other liabilities 21 160,078,876 145,211,181
Total Liabilities 2,848,067,803 2,827,201,240
NET ASSETS 194,587,167 184,907,517

REPRESENTED BY

Share capital 17,912,532 17,912,532

Reserves 39,731,690 37,082,157
Surplus on revaluation of assets - net of tax 22 11,498,728 10,920,597
Unappropriated profit 125,444,217 118,992,231
194,587,167 184,907,517

- -
CONTINGENCIES AND COMMITMENTS 23

The annexed notes 1 to 42 form an integral part of this condensed interim unconsolidated financial information.
-

_________________ __________________ _________________ _________________ _________________

Chairman President and Director Director Chief Financial Officer
Chief Executive
 2
MEEZAN BANK LIMITED
CONDENSED INTERIM UNCONSOLIDATED PROFIT AND LOSS ACCOUNT (UNAUDITED)
FOR THE QUARTER ENDED MARCH 31, 2024

Note Quarter Quarter

ended ended
March 31, March 31,
2024 2023
-------------(Rupees in ‘000)-------------
Profit / return earned on Islamic financing and related assets,
investments and placements 24 119,145,992 81,952,946
Profit / return on deposits and other dues expensed 25 51,581,860 40,907,273
Net profit / return 67,564,132 41,045,673

OTHER INCOME

Fee and Commission Income 26 5,048,904 3,598,109

Dividend income 442,647 241,252
Foreign Exchange Income / (Loss) 477,930 (155,042)
Gain / (loss) on securities 27 60,100 (105,717)
Net gains on derecognition of financial assets measured
at amortised cost - -
Other income 28 327,973 286,882
Total other income 6,357,554 3,865,484

Total income 73,921,686 44,911,157

OTHER EXPENSES

Operating expenses 29 19,956,911 14,344,691

Workers Welfare Fund 1,118,616 589,508
Other charges 30 132,596 2,828
Total other expenses 21,208,123 14,937,027

Profit before credit loss allowance / provisions 52,713,563 29,974,130

Credit loss allowance / provisions / reversals and write offs - net 31 (344,143) 2,129,887

Extra ordinary / unusual items - -

PROFIT BEFORE TAXATION 53,057,706 27,844,243

Taxation 32 27,650,918 12,420,072

PROFIT AFTER TAXATION 25,406,788 15,424,171

--------------- Rupees ----------------------

Basic earnings per share 33 14.18 8.62

Diluted earnings per share 34 14.12 8.61

The annexed notes 1 to 42 form an integral part of this condensed interim unconsolidated financial information.

___________________ ___________________ ___________________ ___________________ __________________

Chairman President and Director Director Chief Financial Officer
Chief Executive
 3
MEEZAN BANK LIMITED
CONDENSED INTERIM UNCONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME (UNAUDITED)
FOR THE QUARTER ENDED MARCH 31, 2024

Note Quarter Quarter

ended ended
March 31, March 31,
2024 2023
--------------(Rupees in ‘000)------------

Profit after taxation for the quarter 25,406,788 15,424,171

Other comprehensive loss

Items that may be reclassified to profit and loss account in

subsequent periods:

- Movement in deficit on revaluation of debt investments

through FVOCI - net of tax (1,764,434) -
- Gain on derecognition of Debt investments at FVOCI
– reclassified to profit or loss - net of tax (30,651) -
- Movement in deficit on revaluation of available for sale
investments - net of tax - (3,063,854)

Items that will not be reclassified to profit and loss account in

subsequent periods:

- Movement in surplus on revaluation of equity investments

through FVOCI - net of tax 17,795 -
- Gain on sale of equity shares - FVOCI 61,393 -

Total Comprehensive Income for the quarter 23,690,891 12,360,317

The annexed notes 1 to 42 form an integral part of this condensed interim unconsolidated financial information.

___________________ ____________________ ___________________ ___________________ _________________

Chairman President and Director Director Chief Financial Officer
Chief Executive
 4
MEEZAN BANK LIMITED
UNCONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE QUARTER ENDED MARCH 31, 2024

Revenue Surplus / (deficit) on

Capital reserves revaluation of
reserves

Non
Distribut- Employee
Unappro-
Share able share
Non- priated Total
capital Share Statutory Capital option General Invest-
banking profit
premium reserve* Reserve - compensa- reserve ments
Assets
Gain on tion
Bargain reserve
Purchase

-------------------------------------------------------------------------------------------------(Rupees in '000)-----------------------------------------------------------------------------------------------
Balance as at January 01, 2023 17,896,243 2,406,571 22,169,518 3,117,547 427,419 66,766 (666,349) 2,678 69,900,300 115,320,693

Profit after taxation for the quarter ended March 31, 2023 - - - - - - - - 15,424,171 15,424,171

Other Comprehensive loss for the quarter ended

March 31, 2023 - net of tax
'- Movement in surplus / (deficit) on revaluation of
available for sale investments - net of tax - - - - - - (3,063,854) - - (3,063,854)
Total other comprehensive income - net of tax - - - - - - (3,063,854) - - (3,063,854)

Transfer from surplus in respect of incremental depreciation of

Non-banking assets to unappropriated profit - net of tax - - - - - - - (3) 3 -

Recognition of share based compensation - - - - 85,366 - - - - 85,366

Other appropriations
Transfer to statutory reserve* - - 1,542,417 - - - - - (1,542,417) -

Transactions with owners recognised directly in equity

Final cash dividend for the year 2022 @ Rs 3 per share - - - - - - - - (5,368,873) (5,368,873)

Balance as at March 31, 2023 17,896,243 2,406,571 23,711,935 3,117,547 512,785 66,766 (3,730,203) 2,675 78,413,184 122,397,503

Profit after taxation for the nine months period ended

December 31, 2023 - - - - - - - - 69,051,471 69,051,471

Other Comprehensive income for the nine months period ended

December 31, 2023 - net of tax
'- Movement in surplus / (deficit) on revaluation of
available for sale investments - net of tax - - - - - - 14,650,800 - - 14,650,800
'- Remeasurement gain / (loss) on defined benefit
obligations - net of tax - - - - - - - - (123,510) (123,510)
'- Movement in surplus on revaluation of non-banking
assets - net of tax - - - - - - - (2,674) - (2,674)
Total other comprehensive income - net of tax - - - - - - 14,650,800 (2,674) (123,510) 14,524,616

Transfer from surplus in respect of incremental depreciation of

Non-banking assets to unappropriated profit - net of tax - - - - - - - (1) 1 -

Recognition of share based compensation - - - - 324,380 - - - - 324,380

Other appropriations
Transfer to statutory reserve* - - 6,905,147 - - - - - (6,905,147) -

Transactions with owners recognised directly in equity

First interim cash dividend for the year 2023 @ Rs 3 per share - - - - - - - - (5,368,873) (5,368,873)
Second interim cash dividend for the year 2023
@ Rs 4 per share - - - - - - - - (7,165,013) (7,165,013)
Third interim cash dividend for the year 2023
@ Rs 5 per share - - - - - - - - (8,956,266) (8,956,266)
- - - - - - - - (21,490,152) (21,490,152)

Issue of 1,628,873 shares under the Employees share option

scheme 16,289 219,870 - - (182,844) - - 46,384 99,699

Balance as at December 31, 2023 17,912,532 2,626,441 30,617,082 3,117,547 654,321 66,766 10,920,597 - 118,992,231 184,907,517
 5

MEEZAN BANK LIMITED

UNCONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE QUARTER ENDED MARCH 31, 2024

Revenue Surplus / (deficit) on

Capital reserves
reserves revaluation of

Non
Distribut- Employee
Share able share Unappro-
Non- Total
capital Statutory Capital option General Invest- priated profit
Share premium banking
reserve* Reserve - compensa- reserve ments
Assets
Gain on tion
Bargain reserve
Purchase

-------------------------------------------------------------------------------------------------(Rupees in '000)-----------------------------------------------------------------------------------------------

Balance as at December 31, 2023 17,912,532 2,626,441 30,617,082 3,117,547 654,321 66,766 10,920,597 - 118,992,231 184,907,517

Impact of adoption of IFRS 9 - net of tax (Note 3.3.5) - - - - - - 2,355,421 - (2,145,490) 209,931

Profit after taxation for the quarter ended March 31, 2023 - - - - - - - - 25,406,788 25,406,788

Other Comprehensive loss for the quarter ended

March 31, 2024 - net of tax

'- Movement in deficit on revaluation of investments

in debt instruments at FVOCI - net of tax - - - - - - (1,764,434) - - (1,764,434)
'- Gain on derecognition of Debt investments at FVOCI
– reclassified to profit or loss - net of tax - - - - - - (30,651) - - (30,651)
Gain on sale of equity shares - FVOCI - - - - - - - - 61,393 61,393
'- Movement in surplus on revaluation of investments
in equity instruments at FVOCI - net of tax - - - - - - 17,795 - - 17,795
Total other comprehensive loss - net of tax - - - - - - (1,777,290) - 61,393 (1,715,897)

Recognition of share based compensation - - - - 108,854 - - - - 108,854

Other appropriations
Transfer to statutory reserve* - - 2,540,679 - - - - - (2,540,679) -

Transactions with owners recognised directly in equity

Final cash dividend for the year 2023 @ Rs 8 per share - - - - - - - - (14,330,026) (14,330,026)

Balance as at March 31, 2024 17,912,532 2,626,441 33,157,761 3,117,547 763,175 66,766 11,498,728 - 125,444,217 194,587,167

*This represents reserve created under section 21(i)(b) of the Banking Companies Ordinance ,1962.

The annexed notes 1 to 42 form an integral part of this condensed interim unconsolidated financial information.

___________________ ____________________ ___________________ ___________________ ___________________

Chairman President and Director Director Chief Financial Officer
Chief Executive
 6
MEEZAN BANK LIMITED
CONDENSED INTERIM UNCONSOLIDATED CASH FLOW STATEMENT (UNAUDITED)
FOR THE QUARTER ENDED MARCH 31, 2024

Note Quarter ended Quarter ended

March 31, 2024 March 31, 2023
--------------(Rupees in '000)--------------
CASH FLOW FROM OPERATING ACTIVITIES
Profit before taxation 53,057,706 27,844,243
Less: Dividend income (442,647) (241,252)
52,615,059 27,602,991
Adjustments:
Depreciation 29 1,328,625 946,588
Net profit / return (68,449,611) (41,453,930)
Amortisation 29 154,995 117,196
Non cash items related to right-of-use assets 25 & 29 1,507,000 1,134,993
Credit loss allowance / provisions / reversals and write offs - net 31 (344,143) 2,129,887
Share based compensation expense 38 108,854 85,366
Unrealised gain - FVTPL 27 - 18
Gain on sale of property and equipment 28 (150,402) (62,715)
(65,844,682) (37,102,597)
(13,229,623) (9,499,606)
(Increase) / decrease in operating assets
Islamic financings and related assets 61,134,897 (31,012,422)
Other assets (5,906,876) (6,531,284)
55,228,021 (37,543,706)
Increase / (decrease) in operating liabilities
Bills payable (385,912) (266,849)
Due to financial institutions (44,655,327) 27,964,041
Deposits and other accounts 52,597,630 132,726,681
Other liabilities (6,562,493) (45,141,206)
993,898 115,282,667
42,992,296 68,239,355
Net profit / return received 76,819,551 43,079,890
Net profit / return paid (51,538,053) (37,407,799)
Income tax paid (20,654,838) (12,187,957)
Net cash generated from operating activities 47,618,956 61,723,489
CASH FLOW FROM INVESTING ACTIVITIES
Net (investments) / redemption in amortized cost securities 18,618 -
Net (investments) / redemption in securities classified as FVOCI (50,936,630) -
Net (investments) / redemption in subsidiaries (1,000,000) -
Net (investments) / redemption in available for sale securities - (4,227,128)
Net (investments) / redemption in held to maturity securities - 62,546
Net (investments) / redemption in held for trading securities - 2,470
Dividends received 442,647 202,557
Investments in property and equipment (4,286,505) (1,999,283)
Investments in intangible assets (61,702) (69,517)
Proceeds from sale of property and equipment 246,876 103,925
Net cash used in investing activities (55,576,696) (5,924,430)
CASH FLOW FROM FINANCING ACTIVITIES
Payment of lease liability against right-of-use assets (996,129) (923,813)
Dividend paid (370) (409)
Net cash used in financing activities (996,499) (924,222)
(Decrease) / increase in cash and cash equivalents (8,954,239) 54,874,837
ECL impact of adoption of IFRS 9 on cash and cash equivalents (43,831) -
Cash and cash equivalents at the beginning of the quarter 35 254,063,812 131,419,265
Cash and cash equivalents at the end of the quarter 35 245,065,742 186,294,102
The annexed notes 1 to 42 form an integral part of this condensed interim unconsolidated financial information.

___________________ ____________________ ___________________ ___________________ ___________________

Chairman President and Director Director Chief Financial Officer
Chief Executive
 7
MEEZAN BANK LIMITED
NOTES TO AND FORMING PART OF THE CONDENSED INTERIM UNCONSOLIDATED
FINANCIAL INFORMATION (UNAUDITED)
FOR THE QUARTER ENDED MARCH 31, 2024

1. LEGAL STATUS AND NATURE OF BUSINESS

1.1 Meezan Bank Limited (the Bank) was incorporated in Pakistan on January 27, 1997, as a public limited company under
the Companies Act, 2017 (previously Companies Ordinance, 1984), and its shares are quoted on the Pakistan Stock
Exchange Limited. The Bank was registered as an ‘Investment Finance Company’ on August 8, 1997, and carried on
the business of investment banking as permitted under SRO 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.

1.2 The Bank was granted a ‘Scheduled Islamic Commercial Bank’ license 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 (the SBP) under section 37 of the State Bank of Pakistan Act, 1956. Currently,
the Bank is engaged in corporate, commercial, consumer, investment and retail banking activities.

1.3 The Bank was operating through One thousand and seven branches as at March 31, 2024 (December 31, 2023: One
thousand and four branches). Its registered office is at Meezan House, C-25, Estate Avenue, SITE, Karachi, Pakistan.

1.4 Based on the unconsolidated financial statements of the Bank for the year ended December 31, 2022, the VIS Credit
Rating Company Limited has reaffirmed the Bank's medium to long-term rating as 'AAA' and the short-term rating as
'A1+'.

2. BASIS OF PRESENTATION

The Bank provides Islamic financing and related assets mainly through Murabaha, Istisna, Tijarah, Ijarah, Diminishing
Musharakah, Running Musharakah, Bai Muajjal, Musawammah, Service Ijarah, Wakalah, Wakalah Tul Istithmar
including under Islamic Export Refinance Scheme and various long term islamic refinancing facilities of the State Bank
of Pakistan respectively.

The purchases and sales arising under these arrangements are not reflected in these unconsolidated 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 financing 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 Resident Shariah Board Member (RSBM) of the Bank.

3. STATEMENT OF COMPLIANCE

3.1 This condensed interim financial information (here-in-after referred to as "financial information") has been prepared in
accordance with the accounting and reporting standards as applicable in Pakistan for interim financial reporting. The
accounting and reporting standards as applicable in Pakistan for interim financial reporting comprise of:

- International Financial Reporting Standards (IFRS) issued by the International Accounting Standards Board (IASB)
as are notified under the Companies Act, 2017;

- Islamic Financial Accounting Standards (IFAS) issued by the Institute of Chartered Accountants of Pakistan as are
notified under the Companies Act, 2017;

- Provisions of and directives issued under the Banking Companies Ordinance, 1962 and the Companies Act, 2017;
and

- Directives issued by the State Bank of Pakistan (SBP) and the Securities Exchange Commission of Pakistan
(SECP).

Whenever the requirements of the Banking Companies Ordinance, 1962, the Companies Act, 2017 or the directives
issued by the SBP and the SECP differ with the requirements of IFRS or IFAS, the requirements of the Banking
Companies Ordinance, 1962, the Companies Act, 2017 and the said directives, shall prevail.
 8 Meezan Bank Limited
Unconsolidated Financial Information

3.2 Significant accounting policies and financial risk management

3.2.1 The financial risk management objectives and policies adopted by the Bank are consistent with those disclosed in the unconsolidated financial statements for
the year ended December 31, 2023.
3.2.2 The significant accounting policies and methods of computation adopted in the preparation of this condensed interim financial information are consistent with
those applied in the preparation of the audited annual financial statements of the Bank for the year ended December 31, 2023 except as mentioned below:

3.2.2.1 Adoption of new forms for the preparation of condensed interim financial information

The SBP, vide its BPRD Circular No. 02 dated February 09, 2023 and BPRD Circular No. 07 dated April 13, 2023, issued the revised forms for the preparation
of the annual / interim financial information of the banks which are applicable for quarterly / half yearly periods beginning on or after January 01, 2024
(previously January 01, 2023). The implementation of the revised forms has resulted in certain changes to the presentation and disclosures of various
elements of the condensed interim financial information. Right of use assets and corresponding lease liability are now presented separately on the face of
Statement of financial position. Previously they were presented under Property and Equipment (previously titled Fixed Assets) and Other Liabilites
respectively. As a result of the this change, the Property and Equipment of the Bank decreased by Rs 19,549 million and Rs 19,572 million as of March 31,
2024 and December 31, 2023 respectively. Further, Other liabilities of the Bank decreased by Rs 22,581 million and Rs 22,094 as of March 31, 2024 and
December 31, 2023 respectively.

The Bank has adopted the above changes in the presentation and made additional disclosures to the extent applicable to its operations and corresponding
figures have been rearranged / reclassified to correspond to current year’s presentation (Note 40).

3.2.2.2 Amendments to approved accounting standards that are effective in the current period
There are certain new and amended standards that became effective during the period (enumerated in note 3.6 to the annual financial statement of the Bank).
However, such standards did not have any significant effect on this condensed interim unconsolidated financial information except IFRS 9 (Financial
Instruments), the impact of which is disclosed under Note 3.3:

3.3 IFRS 9 - 'Financial Instruments'

As directed by the SBP via BPRD Circular no 7 of 2023, IFRS 9, 'Financial Instruments' is effective for periods beginning on or after January 1, 2024
(previously January 01, 2023) for banks having asset base of more than Rs. 500 billion as at December 31, 2022. Moreover, SBP has also issued application
instructions on IFRS 9 for banks in Pakistan for ensuring smooth and consistent implementation of the standard in the banks.

IFRS 9 brings fundamental changes to the accounting for financial assets and to certain aspects of accounting for financial liabilities. To determine appropriate
classification and measurement category, IFRS 9 requires all financial assets, except equity instruments to be assessed based on combination of the entity's
business model for managing the assets and the instruments' contractual cash flow characteristics. The adoption of IFRS 9 has also fundamentally changed
the impairment method of financial assets with a forward-looking Expected Credit Losses (ECL) approach.

3.3.1 Classification
Under IFRS 9, existing categories of financial assets: Held for trading (HFT), Available for Sale (AFS) and Held to maturity (HTM) have been replaced by:

- Financial assets at amortized cost

- Financial assets at fair value through other comprehensive income (FVOCI)
- Financial assets at fair value throught profit or loss account (FVTPL)

Under IFRS 9, the accounting for financial liabilities remains largely the same as before adoption of IFRS 9 and thus all financial liabilities are being carried at
Amortized cost. Financial liabilities can also be designated at FVTPL where gains or losses arising from entity's own credit rating risk relating to are required to
be presented in other comprehensive income with no reclassification to profit or loss account. The Bank does not have any financial liability measured at
FVTPL

3.3.1.1 Business model assessment

The Bank determines its business model at the level that best reflects how it manages groups of financial assets to achieve its business objective.

The Bank's business model is not assessed on an instrument-by-instrument basis, but at a higher level of aggregated portfolios and is based on observable
factors such as:

- the objectives for the portfolio, in particular, whether management's strategy focuses on earning contractual revenue, maintaining a particular yield
profile, matching the duration of the financial assets to the duration of the liabilities that are funding those assets or realizing cash flows through the sale
of the assets;
- How the performance of the business model and the financial assets held within that business model are evaluated and reported to the entity's key
management personnel;
- The risks that affect the performance of the business model (and the financial assets held within that business model) and, in particular, the way those
risks are managed; and
- The expected frequency, value and timing of sales are also important aspects of the Bank’s assessment. However, information about sales activity is
not considered in isolation, but as part of an overall assessment of how the Bank's stated objective for managing the financial assets is achieved and
how cash flows are realized.

The business model assessment is based on reasonably expected scenarios without taking 'worst case' or 'stress case’ scenarios into account. If cash flows
after initial recognition are realised in a way that is different from the Bank's original expectations, the Bank does not change the classification of the remaining
financial assets held in that business model, but incorporates such information when assessing newly originated or newly purchased financial assets going
forward.
 9 Meezan Bank Limited
Unconsolidated Financial Information

Eventually, the financial assets fall under either of the following three business models:

i) Hold to Collect (HTC) Business Model: Holding assets in order to collect contractual cash flows
ii) Hold to Collect and Sell (HTC&S) Business Model: Collecting contractual cash flows and selling financial assets
iii) Other Business Models: Resulting in classification of financial assets as FVTPL

3.3.1.2 Assessments whether contractual cash flows are solely payments of principal and profit (SPPI)

As a second step of its classification process the Bank assesses the contractual terms of financial assets to identify whether they meet the SPPI test.
‘Principal’ for the purpose of this test is defined as the fair value of the financial asset at initial recognition and may change over the life of the financial asset
(for example, if there are repayments of principal or amortisation of the premium/discount). The most significant elements of profit within a financing
arrangement are typically the consideration for the time value of money and credit risk. To make the SPPI assessment, the Bank applies judgement and
considers relevant factors such as the currency in which the financial asset is denominated, and the period for which the profit rate is set. In contrast,
contractual terms that introduce a more than de minimise exposure to risks or volatility in the contractual cash flows that are unrelated to a basic financing
arrangement do not give rise to contractual cash flows that are solely payments of principal and profit on the amount outstanding. In such cases, the financial
asset is required to be measured at FVTPL.

3.3.1.3 Application to Bank's financial assets

Debt based financial assets

Debt based financial assets held by the Bank (including, Islamic financing and related assets; investment in Federal government securities and other
government / private sukuk; due from financial institutions; cash and balances with treasury banks; balances with other banks; and other financial assets) are
measured at amortised cost if they meet both of the following conditions and is not designated as at FVTPL:

- the assets are held within a business model whose objective is to hold assets to collect contractual cash flows; and
- the contractual terms of the financial assets give rise on specified dates to cash flows that are solely payments of principal and profit on the principal
amount outstanding.

The Bank’s business model for these financial assets can still be HTC even when sales of these financial assets occur. However, if more than an infrequent
number of sales or sale(s) of significant value are/is made, the Bank assess whether and how the sales are consistent with the HTC objective. This
assessment include the reason(s) for the sales, the expected frequency of sales, and whether the assets that are sold are held for an extended period of time
relative to their contractual maturities.

Aforementioned financial assets are measured at FVOCI only if it meets both of the following conditions and is not designated as at FVTPL:

- the asset are held within a business model whose objective is achieved by both collecting contractual cash flows and selling financial assets; and
- the contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and profit on the principal
amount outstanding.

Aforementioned financial assets if held for trading purposes are classified as measured at FVTPL.

In addition, on initial recognition, the Bank may irrevocably designate a financial asset that otherwise meets the requirements to be measured at amortised
cost or at FVOCI as at FVTPL if doing so eliminates or significantly reduces an accounting mismatch that would otherwise arise.

The application of these policies also resulted in reclassifications and consequent remeasurements of certain amount of investments in GoP ijarah sukuk held
under Available for Sale portfolio as of December 31, 2023 based on business model. Moreover, the Bank's investment in Sub-ordinated sukuk issued by
other Banks under Available for Sale portfolio as of December 31, 2023 have been reclassified as FVTPL since they do not pass the SPPI criteria due to
equity conversion features embedded in the terms of these sukuk. The following table reconciles their carrying amounts as reported on December 31, 2023 to
the carrying amounts under IFRS 9 on transition to IFRS 9 on January 01, 2023:

Impact of reclassification
Balances as of IFRS 9 Balances as of Remeasurements Balances as of
December 31, 2023 Classification December 31, January 01,
(Audited) 2023 2024 - before
ECL
-----------------------------------------------------(Rupees in '000)-----------------------------------------------------
FVOCI 1,067,226,357 4,931,129 1,072,157,486
- Federal Government Sukuk - AFS 1,192,027,379 FVTPL - - -
Amortized Cost 124,801,022 - 124,801,022

FVOCI 134,442,257 - 134,442,257

- Non Government Sukuk - AFS 135,525,257
FVTPL 1,083,000 - 1,083,000
Equity based financial assets
An equity instrument held by the Bank for trading purposes is classified as measured at FVTPL. Gains and losses on equity instruments at FVTPL are
included in the profit and loss account. On initial recognition of an equity investment that is not held for trading, the Bank may irrevocably elect to present
subsequent changes in fair value in OCI. This election is made on an investment-by-investment basis. The Bank has decided to classify its available for sale
equity investment portfolio as of December 31, 2023 as FVOCI on irrevocable basis.

IFRS 9 has eliminated impairment assessment requirements for investments in equity instruments. Accordingly the Bank has reversed impairment of Rs 2,562
million on equity investment held as at December 31, 2023 and the same has been transferred to deficit on revaluation of investments through
remeasurements.
 10 Meezan Bank Limited
Unconsolidated Financial Information

The measurement category and caryying amount of financial assets in accordance with the accounting and reporting standards as applicable in Pakistan
before and after adoption of IFRS 9 as at January 1, 2024 are compared as follows:

Before adoption of IFRS 9 After adoption of IFRS 9

Carrying
Measurement
Financial assets Carrying amount Measurement category amount (before
category
ECL)
Rs '000 Rs '000
Cash and balances with treasury banks Loans and receivables 242,611,556 Amortised cost 242,611,556
Balances with other banks Loans and receivables 11,452,256 Amortised cost 11,452,256
Due from financial institutions - net Loans and receivables 34,964,299 Amortised cost 34,964,299
Investments - net Held-for-trading - Fair value through profit or loss 1,083,000
Available-for-sale 1,354,524,725 Fair value through other comprehensive income 1,235,756,463
Held-to-maturity 216,954,593 Amortised cost 341,755,615
Islamic financing and related assets - net Loans and receivables 961,673,012 Amortised cost 961,673,012
Other assets (financial assets only) Loans and receivables 125,309,036 Amortised cost 125,309,036
2,947,489,477 2,954,605,237

3.3.1.4 Initial recognition and measurement

Financial assets and financial liabilities are recognized when the entity becomes party to the contractual provisions of the instrument. Regular way purchases
and sales of financial assets are recognized on trade date, the date on which the Bank purchase or sell the asset. Other financial assets and liabilities like
Islamic financing and related assets, due from financial institutions, deposits etc. are recognized when funds are transferred to the customers’ account or
financial institutions or as per underlying Shariah mode. However, for cases, where funds are transferred on deferred payment basis, recognition is done when
underlying asset is purchased. The Bank will recognize due to customer and financial institution balances when these funds reach the Bank.

Amortized Cost
Financial assets and liabilities under Amortized Cost cateogy are initially recognized at fair value adjusted for directly attributable transaction cost. They are
subsequently measured at Amortized Cost. An expected credit loss allowance (ECL) is recognized for financial assets in profit or loss. Rental / profit income /
expense on these assets / liabilities are recognized in profit or loss account. On derecognition of these financial assets and liabilities, capital gain / loss will be
recognized in profit or loss account.

Fair value through Other Comprehensive Income

Financial assets under FVOCI cateogy are initially recognized at fair value adjusted for directly attributable transaction cost. These assets are subsequently
measured at Fair value with changes recorded in OCI. An expected credit loss allowance (ECL) is recognized for these financial assets in profit or loss. Rental
/ profit / dividend income on these assets are recognized in profit or loss account. On derecognition of these financial assets, capital gain / loss will be
recognized in profit or loss account only in case of debt instruments.

Fair value through Profit or Loss

Financial assets under FVTPL cateogy are initially recognized at fair value. Transaction cost will be directly recorded in profit or loss. These assets are
subsequently measured at Fair value with changes recorded in profit or loss. Rental / profit / dividend income on these assets are recognized in profit or loss
account. On derecognition of these financial assets, capital gain / loss will be recognized in profit or loss account. An expected credit loss allowance (ECL) is
not recognized for these financial assets

Bank's revenue recongition policy is consisent with the annual financial statements for the year ended December 31, 2023

3.3.1.5 Derecognition

Financial assets
The Bank derecognises a financial asset when:
- the contractual rights to the cash flows from the financial asset expire; or
- it transfers the rights to receive the contractual cash flows in a transaction in which either:
- substantially all of the risks and rewards of ownership of the financial asset are transferred; or
- the Bank neither transfers nor retains substantially all of the risks and rewards of ownership and it does not retain control of the financial asset.
The Bank enters into transactions whereby it transfers assets recognised in its statement of financial position, but retains either all or substantially all of the
risks and rewards of the transferred assets. In these cases, the transferred assets are not derecognised (Note 3.3.1.6).

Financial liabilities
The Bank derecognises a financial liability when its contractual obligations are discharged or cancelled, or expire. The Bank also derecognises a financial
liability when its terms are modified and the cash flows of the modified liability are substantially different, in which case a new financial liability based on the
modified terms is recognised at fair value.

On derecognition of a financial liability, the difference between the carrying amount extinguished and the consideration paid (including any non-cash assets
transferred or liabilities assumed) is recognised in profit or loss.

3.3.1.6 Modification

The Bank sometimes renegotiates or otherwise modifies the contractual cash flows of financing to customers. When the contractual cash flows of a financial
asset are renegotiated or otherwise modified and the renegotiation or modification does not result in the derecognition of that financial asset in accordance
with IFRS 9, the Bank recalculate the gross carrying amount of the financial asset and shall recognise a modification gain or loss in profit or loss. The gross
carrying amount of the financial asset shall be recalculated as the present value of the renegotiated or modified contractual cash flows that are discounted at
the financial asset’s original effective profit rate (or credit-adjusted effective profit rate for purchased or originated credit-impaired financial assets). Any costs or
fees incurred adjust the carrying amount of the modified financial asset and are amortised over the remaining term of the modified financial asset.
 11 Meezan Bank Limited
Unconsolidated Financial Information

3.3.2 Overview of the ECL principles

The Bank assesses on a forward-looking basis the expected credit losses ('ECL') associated with all Islamic financing and other debt financial assets not held
at FVTPL, together with letter of credit, guarantees and unutilized financing commitments hereinafter referred to as "Financial Instruments". The Bank
recognises a loss allowance for such losses at each reporting date. The measurement of ECL reflects:

- An unbiased and probability-weighted amount that is determined by evaluating a range of possible outcomes;
- The time value of money; and
- Reasonable and supportable information that is available without undue cost or effort at the reporting date about past events, current conditions and
forecasts of future economic conditions.

The ECL allowance is based on the credit losses expected to arise over the life of the asset (the lifetime expected credit loss or LTECL), unless there has
been no significant increase in credit risk since origination, in which case, the allowance is based on the 12 months’ expected credit loss (12mECL) as outlined
below.

The 12mECL is the portion of LTECLs that represent the ECLs that result from default events on a financial instrument that are possible within the 12 months
after the reporting date. Both LTECLs and 12mECLs are calculated at individual customer level.

The Bank has established a policy to perform an assessment, at the end of each reporting period, of whether a financial instrument’s credit risk has increased
significantly since initial recognition, by considering the change in the risk of default occurring over the remaining life of the financial instrument. The Bank
considers an exposure to have significantly increased in credit risk when there is considerable deterioration in the internal rating grade for subject customer.
The Bank also applies a secondary qualitative method for triggering a significant increase in credit risk for an asset, such as moving a customer/facility to the
watch list, or the account becoming forborne. Regardless of the change in credit grades, generally, the Bank considers that there has been a significant
increase in credit risk when contractual payments are more than 60 days past due. However, for certain portfolios, the Bank has rebutted 60 DPD presumption
based on behavioural analysis of its borrowers. When estimating ECLs on a collective basis for a group of similar assets , the Bank applies the similar
principles for assessing whether there has been a significant increase in credit risk since initial recognition.

Based on the above process, the Bank groups its financial instruments into Stage 1, Stage 2,Stage 3 and POCI, as described below:

Stage 1: When financial instruments are first recognised, the Bank recognises an allowance based on 12mECLs. Stage 1 financial
instruments also include facilities where the credit risk has improved and they have been reclassified from Stage 2. The
12mECL is calculated as the portion of LTECLs that represent the ECLs that result from default events on a financial
instrument that are possible within the 12 months after the reporting date. The Bank calculates the 12mECL allowance based
on the expectation of a default occurring in the 12 months following the reporting date. These expected 12-month default
probabilities are applied to a forecast EAD and multiplied by the expected LGD and discounted by an approximation to the
original EIR. This calculation is made for all the scenarios.

Stage 2: When a financial instrument has shown a significant increase in credit risk since origination, the Bank records an allowance for
the LTECLs. Stage 2 also include facilities, where the credit risk has improved and the instrument has been reclassified from
Stage 3. The mechanics are similar to those explained above, including the use of multiple scenarios, but PDs are applied over
the lifetime of the instrument. The expected cash shortfalls are discounted by an approximation to the original EIR.

Stage 3: For financial instruments considered credit-impaired, the Bank recognises the lifetime expected credit losses for these
instruments. The Bank uses a PD of 100% and LGD as computed for each portfolio or as prescribed by the SBP under the
prudential regulations which ever is higher.

POCI: Purchased or originated credit impaired (POCI) assets are financial assets that are credit impaired on initial recognition. POCI
assets are recorded at fair value at original recognition and profit / rental is subsequently recognised based on a credit-adjusted
EIR. ECLs are only recognised or released to the extent that there is a subsequent change in the expected credit losses.

Undrawn financing When estimating LTECLs for undrawn financings commitments, the Bank estimates the expected portion of the financings
commitments commitment that will be drawn down over its expected life. The ECL is then based on the present value of the expected
shortfalls in cash flows if the financings is drawn down, based on a probability-weighting of the three scenarios. The expected
cash shortfalls are discounted at an approximation to the expected EIR on the financings.

For revolving facilities that include both a financings and an undrawn commitment, ECLs are calculated and presented together
with the financings. For financings commitments and letters of credit, the ECL is recognised within Provisions.

Guarantee and letters of The Bank estimates ECLs based on the present value of the expected payments to reimburse the holder for a credit loss that it
credit contracts incurs. The shortfalls are discounted by the risk-adjusted discount rate relevant to the exposure. The calculation is made using
a probability-weighting of the three scenarios. The ECLs related to guarantee and letter of credit contracts are recognised
within Other liabilities.

For receivables on account of refundable security deposits; settlement of transactions (including those originated from Alternative Distribution Channels);
services rendered to customers (including related parties) etc., the Bank applies the simplified approach permitted by IFRS 9, which requires expected lifetime
losses to be recognized from the initial recognition of the these receivables.
 12 Meezan Bank Limited
Unconsolidated Financial Information

The calculation of ECLs

The Bank calculates ECLs based on a three probability-weighted scenarios to measure the expected cash

The mechanics of the ECL calculations are outlined below and the key elements are, as follows:
PD The Probability of Default is an estimate of the likelihood of default over a given time horizon. A default may only happen at a certain time over the
assessed period, if the facility has not been previously derecognised and is still in the portfolio. PD is estimated based on transitioning among credit
states. Credit states are defined by rating classes and are based on the Bank’s internal risk ratings (i.e. from 1 to 12). Through the yearly review of the
non-consumer portfolio, the Bank has drawn a yearly transition matrix of ratings to compute a count based PD over the one year horizon for the past 7
years. PDs for Non rated portfolios are calculated based on Days Past Due (DPD) bucket level for each segment separately. Where practical, they also
build on information from External Rating Agencies. PDs are then adjusted for IFRS 9 ECL calculations to incorporate forward looking information.

EAD The Exposure at Default is an estimate of the exposure at a future default date, taking into account expected changes in the exposure after the
reporting date, including repayments of principal and profit, whether scheduled by contract or otherwise, expected drawdowns on committed facilities,
and accrued interest from missed payments. The maximum period for which the credit losses are determined is the contractual life of a financial
instrument unless the Bank has the legal right to call it earlier. The Bank’s product offering includes a variety of corporate and retail facilities, in which
the Bank has the right to cancel and/or reduce the facilities with one day’s notice. However, in case of revolving facilities, the Bank does not limit its
exposure to credit losses to the contractual notice period, but, instead calculates ECL over a period that reflects the Bank’s expectations of the
customer behaviour, its likelihood of default and the Bank’s future risk mitigation procedures, which could include reducing or cancelling the facilities.

LGD The Loss Given Default is an estimate of the loss arising in the case where a default occurs at a given time. It is based on the difference between the
contractual cash flows due and those that the lender would expect to receive, including from the realisation of any collateral. It is usually expressed as a
percentage of the EAD.

The discount rate used to discount the ECLs is based on the effective profit rate that is expected to be charged over the expected period of exposure to the
facilities. In the absence of computation of the effective profit rate (at reporting date), the Bank uses an approximation e.g. contractual rate (at reporting date).

When estimating the ECLs, the Bank considers three scenarios (a base case, an upside, a downside). Each of these is associated with different PDs. When
relevant, the assessment of multiple scenarios also incorporates how defaulted financing are expected to be recovered, including the probability that the loans
will cure and the value of collateral or the amount that might be received for selling the asset.

Forward looking information

In its ECL models, the Bank relies on a range of forward looking information as economic inputs, such as:
• GDP growth
• Volume of exports of goods
• Consumer Price Index
• Unemployment rate
To mitigate its credit risks on financial assets, the Bank seeks to use collateral, where possible. The bank considers only those collaterals as eligible
collaterals in the EAD calculation which have the following characteritics:

• History of legal certainity and enforceability

• History of recoverability

The Bank's management has only considered cash, liquid Securities, gold, and Government of Pakistan guarantees as eligible collaterals in the LGD
calculation. All of these collaterals have a 0% Haircut other than Equity securities where haircut of 15% is applied.

3.3.3 Definition of default

The Bank defines a financial instrument as in default, which is fully aligned with the definition of credit impaired, when it meets one or more of the following
criteria:

The customer is more than 90 days past due on its contractual payments.except incase of agriculture, project infrastructure and housing financing.

Further the following qualitative criteria has been determined for assessment of default

- The Bank considers that the obligor is unlikely to pay its credit obligations in full, without recourse by the Bank to actions such as realising security (if
held).

- The Bank makes a charge-off or account-specific provision resulting from a perceived decline in credit quality subsequent to the Bank taking on the
exposure.

- The Bank consents to a distressed restructuring of the credit obligation where this is likely to result in a diminished financial obligation caused by the
material forgiveness, or postponement, of principal, interest or (where relevant) fees.

- The obligor has sought or has been placed in bankruptcy or similar protection where this would avoid or delay repayment of the credit obligation to the
industry group.

3.3.4 Write-offs

The Bank’s accounting policy under IFRS 9 remains the same as it was under SBP regulations.

Forborne and modified financings

The Bank sometimes makes concessions or modifications to the original terms of financings as a response to the borrower’s financial difficulties, rather than
taking possession or to otherwise enforce collection of collateral. The Bank considers a financing forborne when such concessions or modifications are
provided as a result of the borrower’s present or expected financial difficulties and the Bank would not have agreed to them if the borrower had been financially
healthy. Indicators of financial difficulties include defaults on covenants, or significant concerns raised by the Credit Risk Department. Forbearance may
involve extending the payment arrangements and the agreement of new financing conditions. Once the terms have been renegotiated, any impairment is
measured using the original EIR as calculated before the modification of terms. It is the Bank’s policy to monitor forborne financing to help ensure that future
payments continue to be likely to occur. Derecognition decisions and classification between Stage 2 and Stage 3 are determined on a case-by-case basis. If
these procedures identify a loss in relation to a financing, it is disclosed and managed as an impaired Stage 3 forborne asset until it is collected or written off.
 13

3.3.5 The Bank has adopted IFRS 9 effective January 01, 2024 with modified retrospective approach for restatement permitted under IFRS 9. The cumulative impact of initial application of Rs 209.93 million has been recorded as an adjustment to equity at the beginning of the current accounting period. Details of impact of
initial application are tabulated below:

Balances as of Impact due to: Total Impact - Taxation Total Impact - Balances as of IFRS 9 Category
December 31, Recognition of Adoption of Reclassification Remeasurements Reversal of Gross of tax (current and Net of tax January 01,
2023 Expected revised s due to provisions deferred) 2024
(Restated) Credit Losses classifications business model held
(ECL) under IFRS 9 and SPPI

----------------------------------------------------------------------------------------------------------------------------------------(Rupees in '000)----------------------------------------------------------------------------------------------------------------------------------------
ASSETS
Cash and balances with treasury banks 242,611,556 (34,003) - - - - (34,003) - (34,003) 242,577,553 Amortized Cost
Balances with other banks 11,452,256 (2,324) - - - - (2,324) - (2,324) 11,449,932 Amortized Cost
Due from financial institutions 34,964,299 - - - - - - - - 34,964,299 Amortized Cost
Investments
- Classified as Available for Sale 1,354,524,725 - (1,354,524,725) - - - (1,354,524,725) - (1,354,524,725) -
- Classified as Fair Value through Other Comprehensive Income - (2,230,173) 1,354,524,725 (125,884,022) 4,618,472 2,497,288 1,233,526,290 - 1,233,526,290 1,233,526,290 FVOCI
- Classified as Held to Maturity 216,954,593 - (216,954,593) - - - (216,954,593) - (216,954,593) -
- Classified as Amortized Cost - - 216,954,593 124,801,022 - - 341,755,615 - 341,755,615 341,755,615 Amortized Cost
- Classified as Held for Trading - - - - - - - - - -
- Classified as Fair Value through Profit or Loss - - - 1,083,000 - - 1,083,000 - 1,083,000 1,083,000 FVTPL
- Associates 845,252 - - - - - - - - 845,252 Not Applicable
- Subsidiary 63,050 - - - - - - - - 63,050 Not Applicable
1,572,387,620 (2,230,173) - - 4,618,472 2,497,288 4,885,587 - 4,885,587 1,577,273,207

Islamic financing and related assets

- Gross Amount 992,027,463 - - - - - - - - 992,027,463
- Provisions (30,354,451) (4,004,838) - - - - (4,004,838) - (4,004,838) (34,359,289)
961,673,012 (4,004,838) - - - - (4,004,838) - (4,004,838) 957,668,174 Amortized Cost

Property and equipment 39,046,484 - - - - - - - - 39,046,484 Outside the scope of IFRS 9

Right-of-use assets 19,571,852 - - - - - - - - 19,571,852 Outside the scope of IFRS 9
Intangible assets 2,271,709 - - - - - - - - 2,271,709 Outside the scope of IFRS 9
Deferred tax asset - - - - - - - - - - Outside the scope of IFRS 9
Other assets - Financial assets 125,309,036 (162,964) - - - - (162,964) - (162,964) 125,146,072 Amortized Cost * / FVOCI * /
FVTPL *
Other assets - Non financial assets 2,820,933 - - - - - - - - 2,820,933 Outside the scope of IFRS 9
3,012,108,757 (6,434,302) - - 4,618,472 2,497,288 681,458 - 681,458 3,012,790,215

LIABILITIES
Bills payable 39,724,176 - - - - - - - - 39,724,176 Amortized Cost
Due to financial institutions 377,494,612 - - - - - - - - 377,494,612 Amortized Cost
Deposits and other accounts 2,217,473,924 - - - - - - - - 2,217,473,924 Amortized Cost
Lease liability against right-of-use assets 22,093,855 - - - - - - - - 22,093,855 Amortized Cost
Sub-ordinated sukuk 20,990,000 - - - - - - - - 20,990,000 Amortized Cost
Deferred tax liabilities 4,213,492 - - - - - - 219,496 219,496 4,432,988 Outside the scope of IFRS 9
Other liabilities - Non financial assets 22,291,665 - - - - - - - - 22,291,665 Outside the scope of IFRS 9
Other liabilities - Financial assets 122,919,516 269,835 - - - - 269,835 (17,804) 252,031 123,171,547 Amortized Cost
2,827,201,240 269,835 - - - - 269,835 201,692 471,527 2,827,672,767
NET ASSETS 184,907,517 (6,704,137) - - 4,618,472 2,497,288 411,623 (201,692) 209,931 185,117,448

REPRESENTED BY

Share capital 17,912,532 - - - - - - - - 17,912,532 Outside the scope of IFRS 9

Reserves 37,082,157 - - - - - - - - 37,082,157 Outside the scope of IFRS 9
Surplus on revaluation of assets - net of tax 10,920,597 - - - 4,618,472 - 4,618,472 (2,263,051) 2,355,421 13,276,018 Outside the scope of IFRS 9
Unappropriated profit 118,992,231 (6,704,137) - - - 2,497,288 (4,206,849) 2,061,359 (2,145,490) 116,846,741 Outside the scope of IFRS 9
184,907,517 (6,704,137) - - 4,618,472 2,497,288 411,623 (201,692) 209,931 185,117,448

* Profit / return accrued is based on classification of underlying financial assets. Remaining other financial assets are classifed as Amortized cost

3.4 Standards, interpretations of and amendments to approved accounting standards that are not yet effective

As referred to in note 3.6 to the annual financial statements of the Bank, there are certain amendments to the financial reporting standards which would become effective from the next financial year, however such amendments are not expected to have a material effect on the Bank's financial statements of the period
of initial application.

4. BASIS OF MEASUREMENT

4.1 This condensed interim unconsolidated financial information has been prepared under the historical cost convention except that certain investments, foreign currency balances, Non-banking assets acquired in satisfaction of claims and commitments in respect of certain foreign exchange contracts have been marked
to market and carried at fair value in accordance with the requirements of the SBP. In addition, obligation in respect of staff retirement benefit and employees compensated leave balances are carried at present value.

4.2 Functional and presentation currency

This condensed interim unconsolidated financial information has been presented in Pakistani Rupee, which is the Bank's functional and presentation currency.

4.3 Rounding off

Figures have been rounded off to the nearest thousand rupees unless otherwise stated.

5. CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS

The basis and the methods used for critical accounting estimates and judgments adopted in this condensed interim financial information are same as those applied in the preparation of the annual financial statements of the Bank for the year ended December 31, 2023.
 14

Note March 31, December 31,

2024 2023
6 CASH AND BALANCES WITH TREASURY BANKS (Unaudited) (Audited)
----------------(Rupees in '000)----------------
In hand
- local currency
CASHLCY 51,131,242 44,000,090
CASHFCY
- foreign currencies 3,472,905 4,043,711
54,604,147 48,043,801
With the State Bank of Pakistan in
SBPLCY
- local currency current accounts 108,108,060 105,848,962
SBPFCY
- foreign currency current accounts 15,383,057 14,790,799
6.1 123,491,117 120,639,761
With the National Bank of Pakistan in
NBPLCY
- local currency current accounts 53,622,482 73,915,744
National Prize Bonds 6.2 9,888 12,250
Less: Credit loss allowance held against cash and balances with treasury banks (42,205) -
Cash and balances with treasury banks - net of credit loss allowance 231,685,429 242,611,556
6.1 These include local and foreign currency amounts required to be maintained by the Bank with the SBP under the
Banking Companies Ordinance, 1962 and /or stipulated by the SBP. These accounts are non-remunerative in nature.
6.2 These represent the national prize bonds received from customers for onward surrendering to SBP. The Bank, as a
matter of Shariah principle, does not deal in prize bonds.

Note March 31, December 31,

2024 2023
7. BALANCES WITH OTHER BANKS (Unaudited) (Audited)
----------------(Rupees in '000)----------------
In Pakistan
BALLCY- in current accounts 11,328,145 9,035,396
Outside Pakistan
BALFCY- in current accounts 2,053,795 1,879,152
- in deposit accounts - 537,708
2,053,795 2,416,860
Less: Credit loss allowance held against balances with other banks (1,626) -
Balances with other banks - net of credit loss allowance 13,380,314 11,452,256

Note March 31, December 31,

2024 2023
8. DUE FROM FINANCIAL INSTITUTIONS (Unaudited) (Audited)
----------(Rupees in '000)----------
Bai Muajjal receivable:
- from scheduled banks / financial institutions - Secured 8.1 34,964,299 34,964,299
BMJUNSEC
- from other Financial Institution 15,500 15,500
34,979,799 34,979,799
34,979,799 34,979,799
DUEFRMFIPR
Less: Credit loss allowance held against due from financial institutions 8.2 (15,500) (15,500)
Due from financial institutions - net of provision 34,964,299 34,964,299
8.1 The effective average return on this product is 11.83% (December 31, 2023: 11.72%) per annum. The balances have
maturities in July 2025 (December 31, 2023: July 2025).
March 31, 2024 (Unaudited) December 31, 2023 (Audited)
Non-performing
Due from
Credit loss due from
financial Provision held
allowance held financial
institutions
institutions
8.2 Category of classification -----------------------------------------(Rupees in '000)-----------------------------------------
Performing - Stage 1 34,964,299 - - -
Under performing - Stage 2 - - - -
Non-performing - Stage 3 (Loss) 15,500 15,500 15,500 15,500
Total 34,979,799 15,500 15,500 15,500
 15
9. INVESTMENTS

9.1 Investments by types

March 31, 2024 (Unaudited) December 31, 2023 (Audited)
Cost / Provision
Credit loss Surplus / Carrying Cost / Surplus /
amortised for Carrying value
allowance (deficit) value amortised cost (deficit)
cost diminutio
-------------------------------------------------------------------------------------------(Rupees in '000)----------------------------------------------------------------------------------------
FVTPL securities
- Non Government Sukuk 1,083,000 - - 1,083,000 - - - -
FVOCI securities
- Federal Government Securities 1,116,569,281 1,570,985 15,860,297 1,130,858,593 - - - -
- Shares 9,509,637 - 1,602,106 11,111,743 - - - -
- Non Government Sukuk 129,020,133 203,122 5,191,806 134,008,817 - - - -
- Foreign Securities 5,698,055 5,643 (107,683) 5,584,729 - - - -
1,260,797,106 1,779,750 22,546,526 1,281,563,882 - - - -
Amortized Cost securities - - - - -
- Federal Government Securities 341,736,997 - - 341,736,997 - - - -

Available for sale securities

- Federal Government Securities - - - - 1,190,199,366 - 12,301,364 1,202,500,730
- Shares - - - - 9,883,161 2,562,064 4,064,496 11,385,593
- Non Government Sukuk - - - - 130,442,094 70,645 5,153,808 135,525,257
- Foreign Securities - - - - 5,219,877 - (106,732) 5,113,145
- - - - 1,335,744,498 2,632,709 21,412,936 1,354,524,725
Held to maturity securities - - -
- Federal Government Securities - - - - 216,954,593 - - 216,954,593

In related parties
Associates
- Units of mutual funds 845,252 - - 845,252 845,252 - - 845,252
Subsidiaries *
- Shares 1,063,050 - - 1,063,050 63,050 - - 63,050
Total Investments 1,605,525,405 1,779,750 22,546,526 1,626,292,181 1,553,607,393 2,632,709 21,412,936 1,572,387,620

* During the quarter, the Bank invested Rs 1 billion as initial paid up capital of fully owned subsidiary - Meezan Exchange Company
(Private) Limited.

9.1.1 Details of investment in subsidiary and associates

March 31, 2024 (Unaudited)
Total
Profit /
comprehe
(loss) Market value /
Percentage Assets Liabilities Revenue n-sive
after net asset share
of holding income /
taxation
(loss)
------------------------------------------------------------------------------(Rupees in '000)-----------------------------------------------------------------------------

Subsidiaries (unlisted)
Al Meezan Investment Management Limited 65.00% 6,157,135 1,775,706 1,245,164 41,415 41,415 N/A
Meezan Exchange Company (Private) Limited 100.00% 1,017,221 32,656 (15,691) (15,435) (15,435) N/A

Associates (open ended - listed)

Meezan Balanced Fund 18.28% 2,231,501 71,068 105,255 82,333 82,333 394,960
Al Meezan Mutual Fund 11.55% 5,297,131 358,979 285,145 237,837 237,837 570,385
Meezan Islamic Fund 5.13% 21,429,729 699,749 1,092,076 892,714 892,714 1,063,560
Meezan Sovereign Fund 0.00% 53,772,305 2,176,229 3,436,011 3,221,741 3,221,741 560
Meezan Gold Fund 11.14% 1,621,284 20,614 125,713 112,800 112,800 178,341
KSE Meezan Index Fund 5.98% 3,625,099 35,298 243,184 228,572 228,572 214,501
87,977,049 3,361,937 5,287,384 4,775,998 4,775,998 2,422,307
 16

March 31, 2023 (Unaudited)

Total Market
Profit /
Percentage comprehens value / net
Assets Liabilities Revenue (loss) after
of holding ive income / asset
taxation
(loss) share
------------------------------------------------------------------------------(Rupees in '000)--------------------------------------------------------------------
Subsidiary (unlisted)
Al Meezan Investment Management Limited 65.00% 4,519,508 1,050,291 560,725 228,125 228,125 N/A

Associates (open ended - listed)

Meezan Balanced Fund 18.28% 2,498,072 295,952 23,194 1,544 1,544 302,471
Al Meezan Mutual Fund 11.55% 3,205,269 76,314 (104,259) (141,231) (141,231) 346,814
Meezan Islamic Fund 5.13% 18,652,382 446,666 (282,504) (476,825) (476,825) 670,422
Meezan Sovereign Fund 0.00% 7,119,031 108,253 267,844 248,507 248,507 526
Meezan Gold Fund 11.14% 929,288 5,564 210,806 205,151 205,151 160,261
KSE Meezan Index Fund 5.98% 2,611,602 18,928 46,170 34,370 34,370 137,440
35,015,644 951,677 161,251 (128,484) (128,484) 1,617,934

Subsidiary and associates are incorporated / registered in Pakistan. Shares in subsidiary are placed in custody account with Central Depository of
Pakistan and cannot be sold without the prior approval of SECP in accordance with the SECP's circular No. 9 of 2006 dated June 15, 2006.

9.1.2 Investments given as collateral

March 31, 2024 (Unaudited) December 31, 2023 (Audited)
Cost /
Cost / Market Market
amortised
amortised cost value value
cost
-------------------------------------(Rupees in '000)----------------------------------
Federal Government Securities
- Sukuk 155,000,000 157,325,000 184,000,000 186,760,000

March 31, December

2024 31, 2023
9.2 Credit loss allowance / Provision for diminution in value of investments (Unaudited) (Audited)
-----------(Rupees in '000)-----------

Opening balance 2,632,709 3,204,697

Impact of adoption of IFRS 9 - reversal of provision held (2,497,288) -

Impact of adoption of IFRS 9 - ECL 2,230,173 -
(267,115)

Charge / (reversals)
ECL charge for the quarter 87,624 -
Charge for the quarter on account of provision for dimunition against shares - 238,864
ECL reversals for the year (608,688) (5,247)
Reversals of provision for dimunition against shares (64,780) (805,605)
(585,844) (571,988)

Closing balance 1,779,750 2,632,709

December 31, 2023

March 31, 2024 (Unaudited)
9.3 Particulars of provision against Debt securities (Audited)
Investment - Non-
Credit loss
Cost / performing Provision
allowance
amortised cost investment
Category of classification --------------------------------------(Rupees in '000)--------------------------------------

Domestic

Performing - Stage 1 1,585,552,349 24,227 - -

Under performing - Stage 2 7,122,078 1,570,985 - -

Non-performing - Stage 3
Substandard 272,000 116,888 - -
Doubtful - - - -
Loss 67,650 67,650 70,645 70,645
339,650 184,538 70,645 70,645

1,593,014,077 1,779,750 70,645 70,645

 17

Note March 31, December 31,

2024 2023
(Unaudited) (Audited)
----------------Rupees in '000----------------
10. ISLAMIC FINANCING AND RELATED ASSETS

In Pakistan:

Murabaha financing and related assets

F1 - Murabaha financing 10.1 6,425,973 6,547,184
F2 - Advances against Murabaha 12,691,759 11,526,208
F3 - Murabaha inventory 2,378,813 1,958,612
F7 - Financing under Islamic Export Refinance - Murabaha 10.2 342,588 503,859
F123B - Financing against Islamic SME Asaan Finance 10.3 946,087 126,483
F123A - Advance against Islamic SME Asaan Finance 809,082 1,005,534
F8 - Advance against Islamic Export Refinance - Murabaha 374,621 244,700
- Inventory under Islamic SME Asaan Finance 25,768 5,000
- Financing against Islamic Working Capital Finance 2,298 -
23,996,989 21,917,580

Running Musharakah financing

F11 - Running Musharakah financing 147,256,645 182,916,112
F16 - Financing under Islamic Export Refinance - Running Musharakah 50,343,496 58,491,956
197,600,141 241,408,068

F12A Istisna financing and related assets

F12B - Istisna financing 34,357,000 35,529,463
F12C - Advances against Istisna 68,777,823 99,829,298
- Istisna inventory 31,206,056 5,988,841
F14 - Financing under Islamic Export Refinance - Istisna 526,484 344,330
F15 - Advances under Islamic Export Refinance - Istisna 11,203,160 10,743,412
- Inventory under Islamic Export Refinance - Istisna 4,267,777 4,756,387
150,338,300 157,191,731

F12D Tijarah financing and related assets

F12E - Tijarah financing 4,202,071 2,311,642
F12F - Tijarah inventory 19,482,059 13,079,258
F36A - Financing under Islamic Export Refinance - Tijarah 1,204,388 1,701,367
F12AD - Inventory under Islamic SME Asaan Finance 852,518 -
F17 - Inventory under Islamic Export Refinance - Tijarah 506,558 836,798
26,247,594 17,929,065

F18 Musawammah financing and related assets

F25 - Musawammah financing 10.4 23,466,673 32,401,509
F26A - Advances against Musawammah 11,866,444 22,924,687
F26 - Musawammah Inventory 9,738,733 17,065,727
F19 - Financing under Islamic Export Refinance - Musawammah 10.5 583,903 563,377
- Financing under SBP's Islamic Financing Facility for
F123F Renewable Energy (IFRE) - Musawammah 10.6 372,000 359,297
- Advances under Islamic Export Refinance - Musawammah 243,389 73,300
F20 - Inventory under Islamic Export Refinance - Musawammah 364,500 301,000
F55 46,635,642 73,688,897
 18
Note March 31, December 31,
2024 2023
(Unaudited) (Audited)
----------------Rupees in '000----------------
Salam Financing and related assets
F30A - Salam Financing 2,296,650 1,392,987
F30C - Advances against Salam 24,236,795 23,878,427
F30B - Salam Inventory 3,116,345 1,393,814
29,649,790 26,665,228

Financing against bills

F29 - Financing against bills - Salam 711,264 1,291,913
F30 - Advance against bills - Salam 1,738 1,738
713,002 1,293,651

F22 - Bai Muajjal financing 10.7 32,251,398 33,086,224

Ijarah financing and related assets

F4 - Net investment in Ijarah 48,758 56,050

F5 - Net book value of assets/investment in Ijarah under IFAS 2 59,085,591 60,109,729
10.8 59,134,349 60,165,779
F6 - Advances against Ijarah 4,503,321 2,839,276
63,637,670 63,005,055

Diminishing Musharakah financing and related assets

F36C - Diminishing Musharakah financing 190,441,347 198,619,635
F13 - Diminishing Musharakah financing - housing 17,757,365 18,552,137
- Diminishing Musharakah financing - SBP's Islamic Financing
Facility for Storage of Agricultural Produce (IFFSAP) 507,857 350,586
- Diminishing Musharakah financing - SBP's Islamic Financing
Facility for Renewable Energy (IFRE) 15,601,290 15,917,226
- Diminishing Musharakah financing - SBP's Islamic Refinance
Facility for Combating COVID – 19 (IRFCC) 201,375 215,211
- Diminishing Musharakah financing - SBP's Islamic SME
Asaan Finance (I-SAAF) Scheme 243,085 76,973
- Diminishing Musharakah financing - SBP's Islamic Long Term
F90 Financing Facility (ILTFF) for Plant & Machinery 18,831,128 19,291,370
- Diminishing Musharakah financing - SBP's Islamic Temporary
F223B Economic Refinance Facility (ITERF) 17,937,503 17,643,962
- Diminishing Musharakah financing - SBP's Islamic Refinance and
Credit Guarantee Scheme for Women Entrepreneurs (IRCGSWE) 17,747 7,873
F9 - Advances against Diminishing Musharakah 29,652,517 16,379,833
F300AA
- Advances against Diminishing Musharakah under SBP's IFFSAP - 185,000
- Advances against Diminishing Musharakah under SBP's IFRE 1,828,709 1,284,996
- Advances against Diminishing Musharakah under SBP's IRFCC 181,715 181,715
- Advances against Diminishing Musharakah under SBP's ISAAF 668,210 963,154
- Advances against Diminishing Musharakah under SBP's ITERF 1,675,907 2,514,059
- Advances against Diminishing Musharakah under SBP's IRFMS 200,000 -
- Advances against Diminishing Musharakah under SBP's IRCGSWE - 9,963
- Advances against Diminishing Musharakah under SBP's ILTFF 3,747,674 4,005,820
F10 299,493,429 296,199,513
 19
Note March 31, December 31,
2024 2023
(Unaudited) (Audited)
----------------Rupees in '000----------------
F12 - Musharakah financing 1,135,725 988,725

F16A - Wakalah Tul Istithmar financing 30,602,133 30,602,133

F24 - Advance against Service Ijarah 14,352,314 14,884,577

- Qard financing under SBP's IRFCC 216,925 250,531

F27 - Labbaik (Qard for Hajj and Umrah) 12,981 15,593

F31 - Staff financing (including under SBP's IFRE) 10.9 12,679,357 11,614,300
F26B
F32 - Other financing 1,258,567 1,286,592
F34
AAAA Gross Islamic Financing and Related Assets 10.10 930,821,957 992,027,463

Less: Credit Loss Allowance - Stage 1 10.12 (2,201,615) -

Less: Credit Loss Allowance - Stage 2 10.12 (985,375) -

Less: Provision against non-performing

F33 Islamic financing and related assets - Specific / Stage 3 10.12 (16,855,935) (16,107,097)

Less: Provision against non-performing

Islamic financing and related assets - General 10.12 (14,223,728) (14,247,354)

Islamic financing and related assets - net of provision 896,555,304 961,673,012

10.1 Murabaha receivable - gross 10.1.1 8,067,234 10,243,132

Less: Deferred murabaha income 10.1.3 (152,756) (231,226)
Profit receivable shown in other assets (1,488,505) (3,464,722)
Murabaha financing 10.1.2 6,425,973 6,547,184

10.1.1 Murabaha Sale Price 8,067,234 10,243,132

Murabaha Purchase Price (6,425,973) (6,547,184)
1,641,261 3,695,948

10.1.2 The movement in Murabaha financing during the quarter / year is as follows:

Opening balance 6,547,184 7,127,282

Sales during the quarter / year 8,529,729 57,566,155
Adjusted during the quarter / year (8,650,940) (58,146,253)
Closing balance 6,425,973 6,547,184
 20

March 31, December 31,

2024 2023
(Unaudited) (Audited)
--------------(Rupees in '000)--------------
10.1.3 Deferred murabaha income

Opening balance 231,226 164,688

Arising during the quarter / year 836,766 7,532,817
Recognised during the quarter / year (915,236) (7,466,279)
Closing balance 152,756 231,226

10.2 Financing under Islamic Export Refinance - Murabaha - gross 357,411 527,330
Less: Deferred income (6,523) (9,440)
Less: Profit receivable shown in other assets (8,300) (14,031)
Financing under Islamic Export Refinance - Murabaha 342,588 503,859

10.2.1 The movement in Islamic Export Refinance Murabaha financing during the quarter / year is as follows:

Opening balance 503,859 711,413

Sales during the quarter / year 409,908 4,841,614
Adjusted during the quarter / year (571,179) (5,049,168)
Closing balance 342,588 503,859

10.2.2 Deferred Islamic Export Refinance murabaha income

Opening balance 9,440 10,030

Arising during the quarter / year 18,236 171,742
Recognised during the quarter / year (21,153) (172,332)
Closing balance 6,523 9,440

10.3 Financing against Islamic SME Asaan Finance - Murabaha - gross 1,021,698 140,007
Less: Deferred income (69,627) (7,398)
Less: Profit receivable shown in other assets (5,984) (6,126)
Financing against Islamic SME Asaan Finance - Murabaha 946,087 126,483

10.3.1 The movement in Islamic SME Asaan Finance (Murabaha financing) during
the quarter / year is as follows:
Opening balance 126,483 94,018
Sales during the quarter / year 926,716 80,500
Adjusted during the quarter / year (107,112) (48,035)
Closing balance 946,087 126,483

10.3.2 Deferred Islamic SME Asaan Finance Murabaha income

Opening balance 7,398 7,566

Arising during the quarter / year 84,970 5,958
Recognised during the quarter / year (22,741) (6,126)
Closing balance 69,627 7,398

10.4 Musawammah financing - gross 25,897,076 35,624,523

Less: Deferred income (1,227,200) (1,674,894)
Less: Profit receivable shown in other assets (1,203,203) (1,548,120)
Musawammah financing 23,466,673 32,401,509

10.5 Financing under Islamic Export Refinance - Musawammah - gross 621,939 607,974
Less: Deferred income (14,797) (25,538)
Profit receivable shown in other assets (23,239) (19,059)
Financing under Islamic Export Refinance - Musawammah 583,903 563,377
 21

March 31, December 31,

2024 2023
(Unaudited) (Audited)
--------------(Rupees in '000)--------------
10.6 Financing under SBP's IFRE - Musawammah - gross 442,781 432,221
Less: Deferred income (69,454) (66,921)
Less: Profit receivable shown in other assets (1,327) (6,003)
Financing under SBP's IFRE - Musawammah 372,000 359,297

10.7 Bai Muajjal financing - gross 35,834,429 37,242,068

Less: Deferred income (815,143) (2,393,786)
Less: Profit receivable shown in other assets (2,767,888) (1,762,058)
Bai Muajjal financing 32,251,398 33,086,224

10.8 Net book value of assets / investments in Ijarah under IFAS 2 is net of depreciation of Rs 49,158 million (December 31, 2023: Rs 49,011
million).

10.9 This includes Rs 720 million (December 31, 2023: Rs 707 million) representing profit free financing to staff advanced under the Bank's
Human Resource Policies.

March 31, December 31,

2024 2023
(Unaudited) (Audited)
10.10 Particulars of financing - Gross --------------(Rupees in '000)--------------

- in local currency 880,633,554 940,666,342

- in foreign currencies 50,188,403 51,361,121
930,821,957 992,027,463

10.11 Islamic financing and related assets include Rs 17,634 million (December 31, 2023: Rs 16,939 million) which have been placed under non-
performing status (Stage 3 under IFRS 9) as detailed below:

March 31, 2024 (Unaudited) December 31, 2023 (Audited)

Non
Non performing Credit loss Provision
Category of classification - Stage 3 under IFRS 9 performing
amount allowance held
amount
------------------------------------(Rupees in '000)------------------------------------
Domestic
Other Assets Especially Mentioned 1,021 453 207,244 2,380
Substandard 1,579,821 977,357 127,575 15,877
Doubtful 493,648 241,226 482,321 78,538
Loss 15,559,767 15,636,899 16,122,057 16,010,302
Total 17,634,257 16,855,935 16,939,197 16,107,097

10.12 Particulars of credit loss allowance / provision against Islamic financing and related assets:

March 31, 2024 (Unaudited) December 31, 2023 (Audited)

Specific General + Total Specific General Total
(including Stage 1 +
Stage 3) Stage 2
-----------------------------------------------------------(Rupees in '000)-----------------------------------------------------------
Opening balance 16,107,097 14,247,354 30,354,451 12,812,762 9,780,641 22,593,403
Impact of IFRS 9 adoption - ECL 550,553 3,454,285 4,004,838 - - -
Impact of IFRS 9 adoption - Reversal of provision - - - - - -
550,553 3,454,285 4,004,838 - - -

Exchange Adjustment for the quarter / year (8,046) - (8,046) 114,703 - 114,703

ECL (including Specific provision) /

General provision:
Charge for the quarter 1,228,742 344,411 1,573,153 3,934,473 4,500,000 8,434,473
Less: Reversals for the quarter (959,168) (635,332) (1,594,500) (754,338) (33,287) (787,625)
269,574 (290,921) (21,347) 3,180,135 4,466,713 7,646,848
Amount written off (63,243) - (63,243) (503) - (503)
Closing balance 16,855,935 17,410,718 34,266,653 16,107,097 14,247,354 30,354,451
 22

10.12.2 The Bank maintains general provision in accordance with the applicable requirements of the Prudential Regulations for Consumer Financing
and House Financing issued by the SBP.

In addition, the Bank has also maintained a general provision of Rs 13,600 million (December 31, 2023: Rs 13,600 million) against financing
made on prudent basis, in view of prevailing economic conditions. This general provision is in addition to the requirements of Prudential
Regulations and IFRS 9.

10.12.3 In accordance with BSD Circular No. 2 dated January 27, 2009 issued by the SBP, the Bank has availed the benefit of Forced Sales Value
(FSV) of collaterals against the non-performing financing. Since under the instructions from the SBP, the Bank considers the higher of IFRS 9
stage 3 provision and provision under Prudential regulations, the FSV benefit availed is not applicable for all non-performing financing. The
accumulated benefit availed amounts to Rs 145.5 million (December 31, 2023: Rs 419.0 million). The additional profit arising from availing
the FSV benefit - net of tax amounts to Rs 74.2 million (December 31, 2023: Rs 213.7 million). The increase in profit, due to availing of the
benefit, is not available for distribution of cash and stock dividend to share holders.

10.12.4 Islamic financing and related assets - particulars of credit loss allowance

March 31, 2024 (Unaudited)

Stage 1 Stage 2 Stage 3 Total
----------------------------------(Rupees in '000)----------------------------------

Opening balance - - - -

Impact of adoption of IFRS 9 2,419,726 1,034,559 16,657,650 20,111,935

Fresh disbursements 131,572 3,414 239,594 374,580

Amount derecognised / repaid (347,821) (83,740) (809,366) (1,240,927)
Transfer to stage 1 28,074 (28,074) - -
Transfer to stage 2 (21,148) 74,415 (53,267) -
Transfer to stage 3 (7,118) (255,099) 262,217 -
(216,441) (289,084) (360,822) (866,347)

Amounts written off / charged off - - (63,243) (63,243)

Changes in risk parameters (1,670) 239,900 622,350 860,580
Other changes - - - -

2,201,615 985,375 16,855,935 20,042,925

10.12.5 Category of classification under IFRS 9

March 31, 2024 (Unaudited) December 31, 2023 (Audited)
Non
Credit loss Provision
Gross Amount performing
allowance held
amount
Domestic ------------------------------------(Rupees in '000)------------------------------------
Performing - Stage 1 under IFRS 9 877,833,917 2,201,615 - -
Underperforming - Stage 2 under IFRS 9 35,353,783 985,375 - -

Non-Performing - including Stage 3 under IFRS 9

Other Assets Especially Mentioned 1,021 453 207,244 2,380
Substandard 1,579,821 977,357 127,575 15,877
Doubtful 493,648 241,226 482,321 78,538
Loss 15,559,767 15,636,899 16,122,057 16,010,302
17,634,257 16,855,935 16,939,197 16,107,097

Total 930,821,957 20,042,925 16,939,197 16,107,097

 23

Note March 31, December 31,

2024 2023
(Unaudited) (Audited)
11. FIXED ASSETS --------------(Rupees in '000)--------------

CWIPFACapital work-in-progress 11.1 10,144,268 9,449,999

COSTFAProperty and equipment 32,063,622 29,896,485
42,207,890 39,346,484
Less: Provision against capital work-in-progress (300,000) (300,000)
ACCDEFA 41,907,890 39,046,484

11.1 Capital work-in-progress

Advances to suppliers and contractors for:

- civil works 5,840,637 6,359,312
- computer hardware 1,380,460 997,260
- purchase of vehicles 554,315 281,747
- office machines 1,930,901 1,419,869
- furniture and fixtures 437,955 391,811
10,144,268 9,449,999

March 31, March 31,

2024 2023
11.2 Additions to fixed assets (Unaudited) (Unaudited)
------------(Rupees in '000)------------
The following additions (net) have been made to fixed assets during the quarter:

Capital work-in-progress 694,269 204,032

Property and equipment

Leasehold land 696,101 -
Building on leasehold land 160,499 83,542
Leasehold improvements 779,367 392,752
Furniture and fixture 53,647 23,581
Electrical, office and computer equipment 1,493,649 1,198,783
Vehicles 408,973 96,593
3,592,236 1,795,251

4,286,505 1,999,283

11.3 Disposal of fixed assets

The net book value of fixed assets disposed off during the quarter is as follows:

Leasehold improvements - 723

Furniture and fixture 77 215
Electrical, office and computer equipment 2,226 14,168
Vehicles 94,171 26,104
96,474 41,210
 24

12. RIGHT-OF-USE ASSETS March 31, 2024 (Unaudited)

Accumulated Net Book
Cost
Depreciation Value
----------------------(Rupees in '000)----------------------
At January 1, 29,812,340 (10,240,488) 19,571,852
Additions during the quarter 598,792 - 598,792
Adjusted upon reassessment of useful life - - -
Depreciation Charge - (621,521) (621,521)
Derecognition during the quarter (118,056) 118,056 -
At March 31, 30,293,076 (10,743,953) 19,549,123

December 31, 2023 (Audited)

Accumulated Net Book
Cost
Depreciation Value
----------------------(Rupees in '000)----------------------
At January 1, 20,682,720 (9,335,704) 11,347,016
Additions during the year 881,582 - 881,582
Adjusted upon reassessment of useful life 10,086,130 - 10,086,130
Depreciation Charge - (2,742,876) (2,742,876)
Derecognition during the year (1,838,092) 1,838,092 -
At December 31, 29,812,340 (10,240,488) 19,571,852

March 31, December 31,

2024 2023
(Unaudited) (Audited)
13. INTANGIBLE ASSETS ----------(Rupees in '000)----------
Computer Software 1,594,086 1,651,018
Advance against computer software 584,330 620,691
2,178,416 2,271,709

March 31, March 31,

2023 2023
13.1 Additions to intangible assets (Unaudited) (Unaudited)
------------(Rupees in '000)------------

Additions (Net) during the quarter 61,702 69,517

 25

Note March 31, December 31,

2024 2023
(Unaudited) (Audited)
14. OTHER ASSETS -------------(Rupees in '000)-------------

PRFACLC
Profit / return accrued in local currency - net of provisions 146,381,684 103,885,757
PRFACFC
Profit / return accrued in foreign currencies - net of provisions 1,150,029 1,319,515
ACCEPT
Acceptances 16,642,843 15,392,217
ADVDEPOTHEP
Advances, deposits, and other prepayments 3,698,021 2,898,657
NBANKASS
Non-banking assets acquired in satisfaction of claims 50,228 50,243
UNREFXG
Mark to market gain on forward foreign exchange contracts 41,343 -
RBROKReceivables on account of sale of securities - 67,113
DIVDREC
Dividends receivable 261 261
BSTAMStamps 25,052 24,397
SDEPOSIT
Security deposits 505,637 515,716
SHASUB
Advance for Investments - -
OTHRECHSB
Receivable under alternate delivery channel 7,469,954 3,373,605
OTHRSOther 639,131 754,852
176,604,183 128,282,333
PROVOTHER
Less: Credit loss allowance / provision held against other assets 14.1.1 (462,168) (152,364)
Other Assets (net of provision) 176,142,015 128,129,969
Surplus on revaluation of non-banking assets acquired in
Splus satisfaction of claims 22 - -
Other assets - total 176,142,015 128,129,969

14.1 Credit loss allowance / provision held against other assets

Profit / return accrued 112,366 -

Acceptances 36,490 -
Non-banking assets acquired in satisfaction of claims 13,923 13,923
Others 299,389 138,441
462,168 152,364

14.1.1 Movement in credit loss allowance / provision held against other assets

Opening balance 152,364 107,921

Impact of adoption of IFRS 9 162,964 -
Charge for the quarter / year (including ECL) 236,630 72,972
Reversals for the quarter / year (57,944) (2,680)
Amount adjusted / written off (31,846) (25,849)
Closing balance 462,168 152,364

15. BILLS PAYABLE

BPAY In Pakistan 39,338,264 39,724,176

Outside Pakistan - -
39,338,264 39,724,176
16. DUE TO FINANCIAL INSTITUTIONS

In Pakistan 332,839,285 377,494,612

Outside Pakistan - -
332,839,285 377,494,612
 26

Note March 31, December 31,

2024 2023
16.1 Details of due to financial institutions secured / unsecured (Unaudited) (Audited)
------------(Rupees in '000)------------
Secured

With State Bank of Pakistan

IERSBOR
Musharakah under Islamic Export Refinance Scheme 70,937,742 78,802,384
Investment under Islamic Long Term Financing Facility 22,511,966 23,280,222
Investment under Islamic Refinance Facility for Combating COVID-19 598,710 646,152
Investment under Islamic Financing for Renewal Energy 17,624,653 17,405,412
Investment under Islamic Temporary Economic Refinance
Facility for Plant and Machinery 19,554,509 20,093,256
Investment under Islamic Refinance Scheme for storage
of agriculture produce 497,536 525,523
Investment under Islamic Refinance and Credit Guarantee
Scheme for Women Entrepreneurs (IRCGSWE) 12,259 7,861
Investment under Islamic Refinance Scheme
for modernization of SMEs (IRFMS) 200,000 -
Investment under Islamic Refinance Scheme for SME Asaan Finance 3,308,862 455,509
Investment under Shariah Compliant Open Market Operations 16.1.1 155,194,338 180,159,641
Total secured 290,440,575 321,375,960
With Scheduled Bank - 4,000,000
MKRNZOther financial institutions 7,067,049 5,279,332
Unsecured
OVRDRNNOS
Overdrawn nostro accounts 2,831,661 2,679,320
CBORRMusharakah with scheduled banks / financial institutions 16.1.2 32,500,000 44,160,000
332,839,285 377,494,612

16.1.1 These represents acceptance of funds by the Bank on Mudarabah basis which has been invested in special pools of the
Bank and are secured against lien of the Bank's investment in Federal Government securities. The expected average
return on Open Market Operations is 22.07% (December 31, 2023: 22.08%) per annum.

16.1.2 These represents acceptance of funds by the Bank on Musharakah basis. The expected average return on these
Musharakah is around 22.00% (December 31, 2023: 21.97%) per annum. These balances have matured in April 2024
(December 31, 2023: January 2024).
 27

17. DEPOSITS AND OTHER ACCOUNTS

March 31, 2024 (Unaudited) December 31, 2023 (Audited)

In local In foreign In local In foreign
Total Total
currency currencies currency currencies
-------------------------------------------------------------------(Rupees in '000)--------------------------------------------------------

Customers
CURRENT
- Current accounts -
non-remunerative 1,004,627,105 55,757,673 1,060,384,778 1,012,415,113 57,892,401 1,070,307,514
SAVING- Savings deposits 865,625,431 70,782,442 936,407,873 803,833,457 68,537,150 872,370,607
FIXED - Fixed deposits 221,640,459 17,073,695 238,714,154 217,884,345 17,080,020 234,964,365
MARGIN- Margin 19,035,055 854,745 19,889,800 25,622,708 1,108,617 26,731,325
2,110,928,050 144,468,555 2,255,396,605 2,059,755,623 144,618,188 2,204,373,811

Financial institutions
- Current accounts -
non-remunerative 2,514,152 428,824 2,942,976 1,249,647 388,192 1,637,839
- Savings deposits 10,943,215 - 10,943,215 10,721,389 - 10,721,389
FI - REMUNERATIVE
- Fixed deposits 788,758 - 788,758 740,885 - 740,885
14,246,125 428,824 14,674,949 12,711,921 388,192 13,100,113

2,125,174,175 144,897,379 2,270,071,554 2,072,467,544 145,006,380 2,217,473,924

Note March 31, December 31,

2024 2023
18. LEASE LIABILITY AGAINST RIGHT-OF-USE ASSETS (Unaudited) (Audited)
-------------(Rupees in '000)------------

As at January 1, 22,093,855 12,813,226

Additions 598,792 881,582
Adjustment upon reassessment of useful life - 10,086,130
Amortisation of lease liability against right-of-use assets 885,479 2,077,327
Derecognition during the quarter / year - -
Payments (996,129) (3,764,410)
As at March 31 / December 31, 22,581,997 22,093,855

19. SUB-ORDINATED SUKUK

Additional Tier I Sukuk 19.1 7,000,000 7,000,000

Tier II Sukuk 19.2 13,990,000 13,990,000
20,990,000 20,990,000
 28

19.1 In August 2018, the Bank issued regulatory Shariah compliant unsecured, sub-ordinated privately placed Additional Tier I
Sukuk based on Mudaraba of Rs. 7,000 million as instrument of redeemable capital under section 66 of the Companies
Act, 2017. The brief description of Additional Tier I sukuk is as follows:

Credit Rating AA+ (Double A plus) by VIS Credit Rating Company Limited.
Issue Date August 01, 2018
Tenor Perpetual
Profit payment
Monthly in arrears
frequency
Perpetual. However, the Bank has call option which can be exercised with prior approval of
Redemption
SBP.

Expected Periodic Profit

Amount (Mudaraba The Mudaraba Profit is computed under General Pool on the basis of profit sharing ratio and
Profit Amount) - Non- monthly weightages announced by the Bank under the SBP guidelines of pool management.
discretionary subject to Last announced profit rate on the Sukuk is 22.57% per annum.
actual profit of the pool

The Bank may call Additional Tier I Sukuk with prior approval of SBP on or after five years from
Call Option
the date of issue.

The Additional Tier I Sukuk, at the option of the SBP, will be fully and permanently converted
Loss Absorbency into common shares (variable) upon the occurrence of a point of non-viability trigger event as
determined by SBP or for any other reason as may be directed by SBP.

Profit and/or redemption amount can be held back in respect of the Additional Tier I Sukuk,
Lock-in-Clause upon directive of the SBP, if such payment will result in a shortfall in the Bank’s minimum
capital requirement, capital adequacy ratio requirement or leverage ratio requirement.

19.2 In January 2020 and December 2021, the Bank issued regulatory Shariah compliant unsecured, subordinated privately
placed Tier II Sukuk based on Mudaraba of Rs. 4,000 million and Rs 9,990 million respectively as instrument of
redeemable capital under section 66 of the Companies Act, 2017. The brief description of Tier II sukuk is as follows:

Credit Rating AAA (Triple A) by VIS Credit Rating Company Limited.

Issue Date January 09, 2020 and December 16, 2021
Tenor 10 years from the issue date
Profit payment
Semi-annually in arrears
frequency
Redemption Bullet payment at the end of the tenth year

Expected Periodic Profit

Amount (Mudaraba The Mudaraba Profit is computed under General Pool on the basis of profit sharing ratio and
Profit Amount) - Non- monthly weightages announced by the Bank under the SBP guidelines of pool management.
discretionary subject to Last announced profit rate on the Sukuk are 22.85% and 22.02% per annum respectively.
actual profit of the pool

The Bank may call Tier II Sukuk with prior approval of SBP on or after five years from the date
Call Option
of issue.

The Tier II Sukuk, at the option of the SBP, will be fully and permanently converted into
Loss Absorbency common shares (variable) upon the occurrence of a point of non-viability trigger event as
determined by SBP or for any other reason as may be directed by SBP.

Profit and/or redemption amount can be held back in respect of the Tier II Sukuk upon directive
Lock-in-Clause of the SBP, if such payment will result in a shortfall in the Bank’s minimum capital requirement,
capital adequacy ratio requirement or leverage ratio requirement.
 29

Note March 31, December 31,

2024 2023
(Unaudited) (Audited)
-------------(Rupees in '000)------------
20. DEFERRED TAX LIABILITIES

Taxable temporary differences on:

Excess of accounting book values over tax
written down values of owned assets 919,218 910,196
Surplus on revaluation of available
for sale investments - 10,492,339
Surplus on revaluation of FVOCI investments 11,047,798 -
Surplus on revaluation of non-banking
assets acquired in satisfaction of claims - -
11,967,016 11,402,535
Deductible temporary differences on:
Provision against investments / impairment in value
of investments (872,078) (1,140,570)
Income not accrued due to non-culmination of financing (5,573,795) (4,982,219)
Provision against Islamic financing
and related assets (2,929,609) (826,762)
Others (423,707) (239,492)
(9,799,189) (7,189,043)

2,167,827 4,213,492
21. OTHER LIABILITIES

Return on deposits and other dues

ACCPLC - payable in local currency 17,777,855 17,723,633
ACCPFC - payable in foreign currencies 321,050 331,465
UNERCOM
Unearned income 3,656,486 3,290,414
ACCEXPAccrued expenses 32,185,529 30,548,977
PROVTAX
Current taxation (provision less payments) 34,283,644 26,688,813
ACCTCTR
Acceptances 16,642,843 15,392,217
UNCLMDIV
Dividend payable (including unclaimed dividend) 15,194,602 864,946
GRATU Payable to defined benefit plan 880,268 1,550,202
PROVOFFBAL
Credit loss allowance / provision against off-balance sheet obligations 21.1 402,540 55,167
CHARITYPAY
Charity payable 13,005 242
SECDEPFIN
Security deposits against Ijarah 18,756,493 18,946,084
CREMUB
Payable on account of credit murabaha / ijarah / musawammah 370,499 1,060
Security deposits against lockers 213,089 207,865
FXREVAL
Mark to market loss on forward foreign exchange commitments - net - 848,249
WITHTAX
Withholding taxes payable 2,272,782 82,892
Workers Welfare Fund payable 10,345,445 9,226,829
Payable under Alternate Delivery Channel 3,996,748 16,978,468
OTHRS Others 2,765,998 2,473,658
160,078,876 145,211,181

21.1 Provision against off-balance sheet obligations

Opening balance 55,167 55,167

Impact of adoption of IFRS 9 269,835 -
Charge for the quarter / year 125,405 -
Reversals for the quarter / year (47,867) -
Closing balance 402,540 55,167
 30

March 31, December 31,

2024 2023
(Unaudited) (Audited)
----------(Rupees in '000)----------
22. SURPLUS ON REVALUATION OF ASSETS - NET OF TAX
Securities measured at FVOCI-Debt 20,944,420 -

Securities measured at FVOCI-Equity 1,602,106 -

Available for sale securities

- Listed shares - 4,064,496
- Sukuk - 17,348,440
- 21,412,936

Non-banking assets acquired in satisfaction of claims - -

22,546,526 21,412,936
Less: Deferred tax asset / (liability) on

- Securities measured at FVOCI-Debt (10,262,766) -

- Securities measured at FVOCI-Equity (785,032) -
- Available for sale securities - (10,492,339)
- Non-banking assets acquired in satisfaction of claims - -
(11,047,798) (10,492,339)
11,498,728 10,920,597
 31
Note March 31, December 31,
2024 2023
(Unaudited) (Audited)
23. CONTINGENCIES AND COMMITMENTS ------------------(Rupees in '000)----------------

-Guarantees 23.1 71,745,645 67,624,287

-Commitments 23.2 1,270,818,310 1,261,716,514
-Other contingent liabilities 23.3 1,802,000 1,802,000
1,344,365,955 1,331,142,801

23.1 Guarantees:

Financial guarantees 30,395 30,395

Performance guarantees 49,965,789 44,956,248
Other guarantees 21,749,461 22,637,644
71,745,645 67,624,287
23.2 Commitments:

Documentary letters of credit 217,114,653 235,057,572

Commitments in respect of:

- forward foreign exchange transactions 23.2.1 288,760,187 281,400,267

Commitments for acquisition of:

- fixed assets 419,521 599,915
- intangible assets 653,495 526,922

Other commitments 23.2.2 763,870,454 744,131,838

1,270,818,310 1,261,716,514

23.2.1 Commitments in respect of forward foreign exchange contracts

Purchase 176,769,288 170,276,350

Sale 111,990,899 111,123,917
288,760,187 281,400,267

23.2.2 Other Commitments

Commitments in respect of financing (including irrevocable commitments) 763,870,454 744,131,838

23.3 Other contingent liabilities

The Income Tax Department amended the deemed assessment orders of the Bank for prior years including the tax
year 2022. The additions / disallowances were mainly due to allocation of expenses relating to dividends and capital
gain, allowability of provision against loans and advances, provision against investments and provision against other
assets. In the amended order for tax year 2015, additional issues with respect to the taxability of gain on bargain
purchase and non-adjustment of loss pertaining to HSBC Bank Middle East – Pakistan Branches have also been
raised. The Bank has obtained stay order from the High Court of Sindh against the demands raised through the
amended order for the tax year 2015. Both the Bank and the department have filed appeals with the Appellate
Authorities in respect of the aforementioned matters.

The management of the Bank, in consultation with its tax advisors, is confident that the decision in respect of the above
matters would be in Bank’s favour and accordingly no provision has been made in these unconsolidated financial
statements with respect thereto. The additional tax liability in respect of gain on bargain purchase and non-adjustment
of loss pertaining to HSBC Bank Middle East – Pakistan Branches is Rs 1,096 million and Rs 706 million respectively.
 32

Note March 31, March 31,

2024 2023
24. PROFIT / RETURN EARNED ON ISLAMIC FINANCING (Unaudited) (Unaudited)
AND RELATED ASSETS, INVESTMENTS AND PLACEMENTS -------------(Rupees in '000)------------

On financing 24.1 40,164,481 29,541,487

On investments 77,929,824 51,269,983

On deposits / placements with financial institutions 1,051,687 1,141,476

119,145,992 81,952,946

24.1 The income on Ijarah under IFAS 2 is net of takaful of Rs 443 million (March 31, 2023: Rs 506 million) recovered from
customers.

March 31, March 31,

2024 2023
(Unaudited) (Unaudited)
-------------(Rupees in '000)------------
24.2 Profit / return recorded on financial assets measured at:
- Fair Value through Profit and Loss 49,585 -
- Fair Value through OCI 66,612,815 -
- Amortized Cost 52,483,592 -
119,145,992 -

Note March 31, March 31,

2024 2023
(Unaudited) (Unaudited)
25. PROFIT / RETURN ON DEPOSITS AND OTHER DUES EXPENSED -------------(Rupees in '000)------------

Deposits and other accounts 25.1 36,523,193 17,634,060

Sub-ordinated Sukuk 1,185,616 936,355
Shariah Compliant Open Market Operations and Standing Ceiling
Facility from the State Bank of Pakistan 7,582,111 17,337,563
Other Musharakahs / Mudarabas 5,405,461 4,591,038
Amortisation of lease liability against right-of-use assets 885,479 408,257
51,581,860 40,907,273

25.1 This includes conversion cost of Rs 715 million (March 31, 2023: conversion credit of Rs 110 million) against foreign
currency deposits.
March 31, March 31,
2024 2023
(Unaudited) (Unaudited)
26. FEE AND COMMISSION INCOME -------------(Rupees in '000)------------

Trade related fees and commissions 1,240,717 837,522

Commission on guarantees 58,530 55,379
Branch banking customer fees 817,740 581,062
Credit related fees 18,565 22,859
Debit card related fees 2,309,432 1,683,633
Investment banking related fees 160,665 91,214
Commission on cash management 103,190 101,808
Commission on home remittances 46,208 59,487
Others (including wealth management related fees) 293,857 165,145
5,048,904 3,598,109

Note March 31, March 31,

2024 2023
(Unaudited) (Unaudited)
27. GAIN / (LOSS) ON SECURITIES -------------(Rupees in '000)------------
Realised - net 27.1 60,100 (105,699)
Unrealised - FVTPL / held for trading - net - (18)
60,100 (105,717)
 33
Note March 31, March 31,
2024 2023
(Unaudited) (Unaudited)
27.1 Realised (loss) / gain on: -------------(Rupees in '000)------------
Federal Government Securities 60,100 (86,978)
Listed Shares - (18,721)
60,100 (105,699)
27.1.1 Net gain / (loss) on financial assets measured at FVOCI under IFRS 9 60,100 -
Net gain / (loss) on financial assets measured at FVTPL under IFRS 9 - -
60,100 -

28. OTHER INCOME

Gain on termination of Islamic financing 175,649 223,167
FAGALSGain on sale of operating fixed assets 150,402 62,715
OTHINCOthers 1,922 1,000
327,973 286,882
29. OPERATING EXPENSES

Total compensation expense 12,066,114 8,289,933

Property expense
Depreciation on right-of-use assets 621,521 726,736
Rent and taxes 49,211 27,040
Utilities cost (including electricity and diesel) 636,291 466,140
Security (including guards) 545,449 324,521
Repair and maintenance (including janitorial charges) 338,694 389,942
Depreciation 311,026 264,851
Others 33,877 8,275
2,536,069 2,207,505
Information technology expenses
Software maintenance 569,294 340,582
Hardware maintenance 88,950 117,650
Depreciation 369,548 257,122
Amortisation 154,995 117,196
Network charges 76,437 82,207
1,259,224 914,757
Other operating expenses
Stationery and printing (including debit card related cost) 547,281 419,477
Repairs and maintenance 155,744 141,439
Local transportation and car running 466,126 435,472
Depreciation on vehicles, equipment etc. 648,051 424,615
Legal and professional charges 20,376 51,545
NIFT and other clearing charges 91,526 60,904
Marketing, advertisement and publicity 511,849 282,001
Security charges - cash transportation 342,043 220,728
Communication (including courier) 598,663 348,847
Travelling and conveyance 85,000 58,606
Training and Development 27,321 40,587
Donation 1,241 -
Fees, subscription and other charges 173,478 128,909
Brokerage and bank charges 85,465 83,059
Office supplies 177,505 140,429
Entertainment 19,745 18,491
Takaful expense 99,850 38,655
Outsourced services costs 6,707 5,976
Auditors' Remuneration 9,035 4,102
Fees and allowances to Shariah Board 10,643 9,324
Directors' fees and allowances 17,760 18,760
Others 95 570
4,095,504 2,932,496

19,956,911 14,344,691
 34
Note March 31, March 31,
2024 2023
(Unaudited) (Unaudited)
30. OTHER CHARGES -------------(Rupees in '000)------------
PENSBPPenalties imposed by the State Bank of Pakistan 132,596 2,828

31. CREDIT LOSS ALLOWANCE / PROVISIONS / REVERSALS AND WRITE OFFS - NET
Net Credit loss allowance / Provision / Reversals against non-performing
Islamic financing and related assets - net 10.12 (21,347) 2,053,175
Net Credit loss allowance / Provision / Reversals against diminution
in value of investments 9.2 (585,844) 71,769
Net Credit loss allowance against cash and balance with treasury banks 8,202 -
Net Credit loss allowance against balances with other banks (698) -
Net Credit loss allowance / provision / reversals against other assets 14.1.1 178,686 6,477
Net Credit loss allowance / provision against off-balance sheet obligations 21.1 77,538 -
Recoveries of written off financings (680) (1,534)
(344,143) 2,129,887
32. TAXATION
Current 32.1 28,208,486 12,581,978
Deferred (557,568) (161,906)
27,650,918 12,420,072

32.1 Through Finance Act 2022, the effective tax rate on banking companies has been increased and consequently from the
year 2022, tax rates has been enhanced to 49% (inclusive of 10% Super Tax) from 43% in 2021 (inclusive of 4% Super
Tax). Accordingly, the Bank has recognised super tax charge of Rs 5,443 million (Q1 2023: Rs 1,141 million) in the current
quarter based on taxable income for the quarter.

March 31, March 31,

2024 2023
(Unaudited) (Unaudited)
33. BASIC EARNINGS PER SHARE -------------(Rupees in '000)------------
Profit for the quarter 25,406,788 15,424,171
-------------------(Number)-------------------

Weighted average number of ordinary shares 1,791,253,200 1,789,624,321

---------------------(Rupees)---------------------

Basic earnings per share 14.18 8.62

March 31, March 31,
2024 2023
(Unaudited) (Unaudited)
34. DILUTED EARNINGS PER SHARE ---------------(Rupees in '000)--------------
Profit for the quarter 25,406,788 15,424,171
-------------------(Number)-------------------

Weighted average number of ordinary shares 34.1 1,799,242,599 1,790,479,468

---------------------(Rupees)---------------------

Diluted earnings per share 14.12 8.61

34.1 Reconciliation of basic and diluted earning per share ---------------------(Number)------------------
Weighted average number of ordinary shares 1,791,253,200 1,789,624,321
Add: Diluted impact of Employee stock option scheme 7,989,399 855,147
Dilutive potential ordinary shares 1,799,242,599 1,790,479,468

Note March 31, March 31,

2024 2023
(Unaudited) (Unaudited)
35. CASH AND CASH EQUIVALENTS -------------(Rupees in '000)-------------
Cash and balances with treasury banks 6 231,685,428 175,189,889
Balances with other banks 7 13,380,314 11,104,213
245,065,742 186,294,102
 35

36. FAIR VALUE MEASUREMENTS

The fair value of quoted securities other than those classified as Amortized cost, is based on quoted market price. Quoted
securities classified as amortized cost are carried at cost. The fair value of unquoted equity securities, other than investments
in associates and subsidiaries, is determined on the basis of an appropriate valuation model or alternatively break-up value of
these investments as per their latest available audited financial statements.

The fair value of unquoted debt securities, fixed term loans, other assets, other liabilities, fixed term deposits and borrowings
cannot be calculated with sufficient reliability due to the absence of a current and active market for these assets and liabilities
and reliable data regarding market rates for similar instruments.

36.1 Fair value of financial assets

The Bank measures fair values using the following fair value hierarchy that reflects the significance of the inputs used in
making the measurements:

Level 1: Fair value measurements using quoted prices (unadjusted) in active markets for identical assets or liabilities.

Level 2: Fair value measurements using inputs other than quoted prices included within Level 1 that are observable for the
asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices).

Level 3: Fair value measurements using input for the asset or liability that are not based on observable market data (i.e.
unobservable inputs).

March 31, 2024 (Unaudited)

Fair value
Carrying value
Level 1 Level 2 Level 3 Total
------------------------------------------------------------------------------ (Rupees in '000) ---------------------------------------------------------------
On balance sheet financial instruments

Financial assets - measured at fair value

Investments
- Federal Government securities 1,130,858,593 64,416,750 1,066,441,843 - 1,130,858,593
- Shares 11,111,743 10,503,923 - 607,820 11,111,743
- Non Government Sukuk 120,642,204 119,559,204 1,083,000 - 120,642,204
- Foreign Securities 5,574,340 - 5,574,340 - 5,574,340

1,268,186,880 194,479,877 1,073,099,183 607,820 1,268,186,880

Financial assets - disclosed but not
measured at fair value
Investments
- Federal Government securities 341,736,997 - 307,130,000 - 307,130,000
341,736,997 - 307,130,000 - 307,130,000

1,609,923,877 194,479,877 1,380,229,183 607,820 1,575,316,880

Off-balance sheet financial instruments -
measured at fair value
Forward purchase and sale of foreign
exchange contracts 295,046,198 - 295,046,198 - 295,046,198

December 31, 2023 (Audited)

Fair value
Carrying value
Level 1 Level 2 Level 3 Total
------------------------------------------------------------------------------ (Rupees in '000) ---------------------------------------------------------------
On balance sheet financial instruments

Financial assets - measured at fair value

Investments
- Federal Government securities 1,202,500,730 633,750 1,201,866,980 - 1,202,500,730
- Shares 10,845,690 10,845,690 - - 10,845,690
- Non Government Sukuk 119,520,856 119,520,856 - - 119,520,856
- Foreign Securities 5,102,756 - 5,102,756 - 5,102,756
1,337,970,032 131,000,296 1,206,969,736 - 1,337,970,032
Financial assets - disclosed but not
measured at fair value
Investments
- Federal Government securities 216,954,593 - 187,691,000 - 187,691,000
216,954,593 - 187,691,000 - 187,691,000

1,554,924,625 131,000,296 1,394,660,736 - 1,525,661,032

Off-balance sheet financial instruments -
measured at fair value
Forward purchase and sale of foreign
exchange contracts 284,833,586 - 284,833,586 - 284,833,586
 36

36.2 Fair Value of non-financial assets

March 31, 2024 (Unaudited)

Fair value
Carrying value
Level 1 Level 2 Level 3 Total
------------------------------------------------------------------------------ (Rupees in '000) ---------------------------------------------------------------
Non-banking assets acquired in satisfaction
of claims 36,320 - - 36,320 36,320
36,320 - - 36,320 36,320

December 31, 2023 (Audited)

Fair value
Carrying value
Level 1 Level 2 Level 3 Total
------------------------------------------------------------------------------ (Rupees in '000) ---------------------------------------------------------------
Non-banking assets acquired in satisfaction
of claims 36,320 - - 36,320 36,320
36,320 - - 36,320 36,320

Non-banking assets acquired in satisfactions of claims are carried at revalued amounts (level 3 measurement) determined by
professional valuers based on their assessment of the market values.

. Valuation techniques used in determination of fair values

Item Valuation approach and input used

The valuation has been determined through closing rates of Pakistan Stock
Listed Securities
Exchange.

The fair value of GoP sukuk listed on Pakistan Stock Exchange has been
determined through closing rates of Pakistan Stock Exchange.The fair value of
other GoP Ijarah Sukuk quoted are derived using PKISRV rates. The PKISRV
GoP Sukuk
rates are announced by FMA (Financial Market Association) through Reuters.
The rates announced are simple average of quotes received from eight different
pre-defined / approved dealers / brokers.

Foreign Sukuk The valuation has been determined through closing rates of Bloomberg.

The valuation has been determined by interpolating the mid rates announced by
Forward foreign exchange contracts
SBP.

Non-banking assets acquired in satisfaction

NBAs are valued by professionally qualified valuers as per the accounting policy
of claims

The valuation has been determined based on Net asset values declared by
Mutual Funds
respective funds.

Dividend discount model using a constant dividend stream and terminal value (if
determinable). For unquoted equity securities, where no reliable data is
Unquoted Equity Securities
available, break-up value determined on the basis of NAV of the company using
the latest available audited financial statements

The Bank's policy is to recognise transfers into and out of the different fair value hierarchy levels at the date the event or
change in circumstances that caused the transfer occurred.

There were no transfers between levels 1 and 2 during the quarter.

Fair value of Islamic financing and related assets, unquoted sukuk, other assets, other liabilities and fixed term deposits and
other accounts and due to financial institutions 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 Islamic financing and related assets has been made in accordance with the Bank’s accounting policy as stated
in note 6.3.2 to the 2023 annual financial statements..

In the opinion of the management, the fair value of the remaining financial assets and liabilities are not significantly different
from their carrying values since these assets and liabilities are short term in nature or in the case of financings and deposits
are frequently repriced.
 37
37. SEGMENT INFORMATION
37.1 Segment Details with respect to Business Activities
2024
Corporate and
Inter-segment
Commercial Retail banking Trading and sales Others Total
Eliminations
banking
-----------------------------------------------------------------------------(Rupees in '000)-------------------------------------------------------------------------------------
Profit and loss account for the quarter ended
March 31. 2024 (Unaudited)
External funded revenue 38,452,457 2,613,360 78,080,175 - - 119,145,992
External non funded revenue 1,539,225 1,235,024 980,678 2,602,627 - 6,357,554
Inter segment revenue - net - 110,564,239 - - (110,564,239) -
Total Income 39,991,682 114,412,623 79,060,853 2,602,627 (110,564,239) 125,503,546

External cost of funds 3,865,200 37,611,447 10,105,213 - - 51,581,860

Segment direct expenses 608,729 19,327,372 245,191 1,026,831 - 21,208,123
Inter segment expense allocation 33,106,873 - 77,393,431 63,935 (110,564,239) -
Total expenses 37,580,802 56,938,819 87,743,835 1,090,766 (110,564,239) 72,789,983
Net ECL / Provisions / (Reversals) and write offs - net 202,498 (65,877) (662,781) 182,017 - (344,143)
Profit before tax 2,208,382 57,539,681 (8,020,201) 1,329,844 - 53,057,706

Statement of financial position as at March

31, 2024 (Unaudited)
Cash and bank balances 2,052,169 239,538,670 - 3,474,903 - 245,065,742
Due from financial institutions - net - - 34,964,299 - - 34,964,299
Investments - net 13,955,984 - 1,612,336,197 - - 1,626,292,181
Net inter segment lending - 2,095,685,794 - - (2,095,685,794) -
Islamic financings and related assets - net 807,853,495 88,701,809 - - - 896,555,304
Others 41,899,655 72,136,061 118,285,039 7,456,689 - 239,777,444
Total Assets 865,761,303 2,496,062,334 1,765,585,535 10,931,592 (2,095,685,794) 3,042,654,970

Due to financial institutions 131,411,978 10,901,309 190,525,998 - - 332,839,285

Deposits and other accounts - 2,270,071,554 - - - 2,270,071,554
Subordinated sukuk 20,990,000 - - - - 20,990,000
Net inter segment borrowing 629,195,809 - 1,461,361,628 5,128,357 (2,095,685,794) -
Others 28,795,411 189,484,157 783,270 5,104,126 - 224,166,964
Total liabilities 810,393,198 2,470,457,020 1,652,670,896 10,232,483 (2,095,685,794) 2,848,067,803
Equity 55,368,105 25,605,314 112,914,639 699,109 - 194,587,167
Total Equity and liabilities 865,761,303 2,496,062,334 1,765,585,535 10,931,592 (2,095,685,794) 3,042,654,970

Contingencies and Commitments 952,373,747 103,232,021 288,760,187 - - 1,344,365,955

2023
Corporate and
Inter-segment
Commercial Retail banking Trading and sales Others Total
Eliminations
banking
-----------------------------------------------------------------------------(Rupees in '000)-------------------------------------------------------------------------------------
Profit and loss account for the quarter ended
March 31. 2023 (Unaudited)
External funded revenue 32,896,572 2,154,282 46,902,092 - - 81,952,946
External non funded revenue 1,069,633 907,871 39,977 1,848,003 - 3,865,484
Inter segment revenue - net - 66,177,683 - 93,273 (66,270,956) -
Total Income 33,966,205 69,239,836 46,942,069 1,941,276 (66,270,956) 85,818,430

External cost of funds 2,582,921 18,235,538 20,088,814 - - 40,907,273

Segment direct expenses 380,144 13,629,839 181,344 745,700 - 14,937,027
Inter segment expense allocation 29,001,815 - 37,269,141 - (66,270,956) -
Total expenses 31,964,880 31,865,377 57,539,299 745,700 (66,270,956) 55,844,300
Provisions and write offs - net 2,030,609 22,502 71,769 5,007 - 2,129,887
Profit before tax (29,284) 37,351,957 (10,668,999) 1,190,569 - 27,844,243

Statement of financial position as at

December 31, 2023 (Audited)
Cash and bank balances 2,416,860 244,475,948 - 7,171,004 - 254,063,812
Due from financial institutions - net - - 34,964,299 - - 34,964,299
Investments - net 16,004,402 - 1,556,383,218 - - 1,572,387,620
Net inter segment lending - 2,010,062,419 - 7,500,761 (2,017,563,180) -
Islamic financings and related assets - net 872,356,169 89,316,843 - - - 961,673,012
Others 46,375,068 68,610,791 70,660,404 3,373,751 - 189,020,014
Total Assets 937,152,499 2,412,466,001 1,662,007,921 18,045,516 (2,017,563,180) 3,012,108,757

Due to financial institutions 140,798,856 5,696,799 230,998,957 - - 377,494,612

Deposits and other accounts - 2,217,473,924 - - - 2,217,473,924
Subordinated sukuk 20,990,000 - - - - 20,990,000
Net inter segment borrowing 691,084,684 - 1,326,478,496 - (2,017,563,180) -
Others 26,748,984 164,592,502 2,503,024 17,398,194 - 211,242,704
Total liabilities 879,622,524 2,387,763,225 1,559,980,477 17,398,194 (2,017,563,180) 2,827,201,240
Equity 57,529,975 24,702,776 102,027,444 647,322 - 184,907,517
Total Equity and liabilities 937,152,499 2,412,466,001 1,662,007,921 18,045,516 (2,017,563,180) 3,012,108,757

Contingencies and Commitments 946,041,322 103,701,212 281,400,267 - - 1,331,142,801

 38
38. RELATED PARTY TRANSACTIONS
38.1 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
includes a subsidiary company, associated companies, retirement benefit funds, directors, and key management personnel and their close family members.

38.2 The Banks enters into transactions with related parties in the ordinary course of business and on substantially the same terms as for comparable transactions with person of similar standing.
Contributions to and accruals in respect of staff retirement benefits and other benefit plans are made in accordance with the actuarial valuations / terms of the contribution plan. Remuneration
and other benefit to the key management personnel is determined in accordance with the terms of their appointment.

38.3 Subsidiary companies

- Al Meezan Investment Management Limited
- Meezan Exchange Company (Private) Limited

38.4 Associates

Associates include mutual funds managed by Al Meezan Investment Management Limited and entities having common directorship with the Board. However, entities are not considered related
party only if common director is an independent director working on both the Boards.

38.5 Key management personnel

- President and Chief Executive Officer

- Deputy Chief Executive Officers

38.6 Details of transactions with related parties and balances with them (other than those disclosed in respective notes) as at the year-end as are follows. Balances pertaining to parties that were
related at the beginning of the year but ceased to be related during any part of the current quarter are not reflected as part of the closing balance. However, new related parties have been added
during the quarter. The same are accounted for through the movement presented above.

Total Subsidiary Associates Directors Key management personnel Other related parties
March 31, 2024 December 31, March 31, December March 31, 2024 December 31, March 31, December March 31, December March 31, December
(Unaudited) 2023 (Audited) 2024 31, 2023 (Unaudited) 2023 (Audited) 2024 31, 2023 2024 31, 2023 2024 31, 2023
(Unaudited) (Audited) (Unaudited) (Audited) (Unaudited) (Audited) (Unaudited) (Audited)
---------------------------------------------------------------------------------------------------------------------------------------------(Rupees in '000)----------------------------------------------------------------------------------------------------------------------------------------
Islamic financing and related assets SubsidiaryFinancings AssociateFINANCINGs KMP / DirectorFINANCING KMPFinancings
At January 1, 33,002,164 29,972,348 - - 32,914,968 29,972,348 - - 87,196 - - -
Addition during the quarter / year 3,435,612 23,154,677 - - 3,435,612 23,066,434 - - - 88,243 - -
Repayment / redemption / deletion during the quarter / year (5,003,791) (20,124,861) - - (5,002,731) (20,123,814) - - (1,060) (1,047) - -
At December 31 31,433,985 33,002,164 - - 31,347,849 32,914,968 - - 86,136 87,196 - -

Investments SubsidiaryInvestments AssociateInvestments

At January 1, 908,302 908,302 63,050 63,050 845,252 845,252 - - - - - -
Addition during the quarter / year 1,000,000 - 1,000,000 - - - - - - - - -
Repayment / redemption / deletion during the quarter / year - - - - - - - - - - - -
At December 31 1,908,302 908,302 1,063,050 63,050 845,252 845,252 - - - - - -
 39

Total Subsidiary Associates Directors Key management personnel Other related parties
March 31, 2024 December 31, March 31, December March 31, 2024 December 31, March 31, December March 31, December March 31, December
(Unaudited) 2023 (Audited) 2024 31, 2023 (Unaudited) 2023 (Audited) 2024 31, 2023 2024 31, 2023 2024 31, 2023
(Unaudited) (Audited) (Unaudited) (Audited) (Unaudited) (Audited) (Unaudited) (Audited)
---------------------------------------------------------------------------------------------------------------------------------------------(Rupees in '000)----------------------------------------------------------------------------------------------------------------------------------------
SubsidiaryDeposits AssociateDeposits KMP / DirectorDeposits KMP Deposits Other Related PartyDeposits
Deposits 8,520,625 6,588,811 1,058,081 53,388 6,495,016 5,521,325 172,918 167,014 161,051 176,832 633,559 670,252

Other Assets AssociateProfit receivable on financing KMPFinancingsrec

Profit receivable on financing / investments /
placements 2,830,279 1,076,495 - - 2,830,244 1,076,459 - - 35 36 - -
Fee and Other Receivable 222,096 113,922 120,879 83,405 101,217 28,800 - - - - - 1,717

Provision against ECL 3,617 - 22 - 3,584 - - - 11 - - -

Due to financial institutions

At January 1, - 18,000,000 - - - 18,000,000 - - - - - -
Addition during the quarter / year 57,800,000 157,050,000 - - 57,800,000 157,050,000 - - - - - -
Repayment / redemption / deletion during the quarter / year (57,800,000) (175,050,000) - - (57,800,000) (175,050,000) - - - - - -
At December 31 - - - - - - - - - - - -

Sub-ordinated Sukuk
At January 1, 210,000 210,000 - - 210,000 210,000 - - - - - -
Addition during the quarter / year - 200,000 - - - 200,000 - - - - - -
Repayment / redemption / deletion during the quarter / year - (200,000) - - - (200,000) - - - - - -
At December 31 210,000 210,000 - - 210,000 210,000 - - - - - -

Other Liabilities SubsidiaryPortfolio

SubsidiaryPortfolio
managementmanagement
fee payable fee payable KMPPayable KMPPayable
to defined benefit
Other
to defined
plan
Related
benefit
Other
PartyPayable
plan
Related Party
to d
Payable to defined benefit plan 880,268 1,550,202 - - - - - - 693,801 663,573 186,467 886,629
Accrued Expenses 17,367 11,717 6,707 6,707 - - 10,660 5,010 - - - -
Unearned Income 4,505 4,534 - - 4,505 4,534 - - - - - -

Contingencies and Commitments SubsidiaryGUARANTEE AssociateLETTER OF CREDIT ExecutiveGUARANTEE

Letters of credit (unfunded) 1,625 81,444 - - 1,625 81,444 - - - - - -
Letters of Guarantee (unfunded) 916,376 1,175,557 100 100 916,276 1,175,457 - - - - - -
 40

Total Subsidiary Associates Directors Key management personnel Other related parties
March 31, 2024 March 31, 2023 March 31, March 31, March 31, 2024 March 31, 2023 March 31, March 31, March 31, March 31, March 31, March 31,
(Unaudited) (Unaudited) 2024 2023 (Unaudited) (Unaudited) 2024 2023 2024 2023 2024 2023
(Unaudited) (Unaudited) (Unaudited) (Unaudited) (Unaudited) (Unaudited) (Unaudited) (Unaudited)
---------------------------------------------------------------------------------------------------------------------------------------------(Rupees in '000)----------------------------------------------------------------------------------------------------------------------------------------

Transactions, income and expenses Fees earnedSubsidiary Fees earnedAssociate

Profit earned on financing / investments /
placements 1,790,505 1,123,347 - - 1,789,423 1,123,347 - - 1,082 - - -

Fees and other income earned 289,872 174,659 110,461 38,180 179,303 136,355 1 10 67 73 40 41

Dividend income earned 260,000 130,000 260,000 130,000 - - - - - - - -

Return on deposits / acceptance expensed 416,253 870,492 2,596 1,195 389,896 854,290 1,130 674 4,370 1,672 18,261 12,661

Charge for defined benefit plan 186,467 146,633 - - - - - - - - 186,467 146,633

Contribution to defined contribution plan 175,863 137,797 - - - - - - - - 175,863 137,797

Contribution to staff benevolent fund 68,712 5,407 - - - - - - - - 68,712 5,407

ECL charge / (reversals) - including recognized in

unappropriated profit 3,617 - 22 - 3,584 - - - 11 - - -

Fees expensed 7,281 6,362 6,707 5,976 574 386 - - - - - -

Recovery of expenses 32,474 - 32,474 - - - - - - - - -

Purchase of fixed assets 32,845 41,737 - - 32,845 41,737 - - - - - -

Remuneration to key management personnel 97,952 75,487 - - - - - - 97,952 75,487 - -

Fee to non-executive directors 17,760 18,760 - - - - 17,760 18,760 - - - -

 41

39. CAPITAL ADEQUACY, LEVERAGE RATIO & LIQUIDITY REQUIREMENTS March 31, December 31,
2024 2023
(Unaudited) (Audited)
------------(Rupees in '000)------------
Minimum Capital Requirement (MCR)
Paid-up capital (net of losses) 17,912,532 17,912,532

Capital Adequacy Ratio

Eligible Common Equity Tier 1 (CET 1) Capital 180,749,513 171,598,930
Eligible Additional Tier 1 (ADT 1) Capital 7,000,000 7,000,000
Total Eligible Tier 1 Capital 187,749,513 178,598,930
Eligible Tier 2 Capital 32,879,063 32,640,088
Total Eligible Capital (Tier 1 + Tier 2) 220,628,576 211,239,018

Risk weighted assets (RWAs):

Credit Risk 591,226,823 618,359,310
Market Risk 28,842,665 29,240,708
Operational Risk 296,043,878 296,043,878
Total 916,113,366 943,643,896

Common Equity Tier 1 Capital Adequacy ratio 19.73% 18.18%

Tier 1 Capital Adequacy Ratio 20.49% 18.93%
Total Capital Adequacy Ratio 24.08% 22.39%

Leverage ratio (LR):

Tier-1 Capital 187,749,513 178,598,930
Total Exposures 3,416,903,582 3,406,288,360
Leverage Ratio 5.49% 5.24%

Liquidity coverage ratio (LCR):

Total High Quality Liquid Assets 1,274,869,394 1,002,019,479
Total Net Cash Outflow 396,700,283 354,386,339
Liquidity Coverage Ratio 321% 283%

Net stable funding ratio (NSFR):

Total Available Stable Funding 2,245,314,887 2,161,583,994
Total Required Stable Funding 1,167,217,498 1,049,256,515
Net Stable Funding Ratio 192% 206%
 42

40. RECLASSIFICATIONS

As a result of change in forms for the preparation of condensed interim financial information issued by SBP as referred in note
3.2.2 and for better presentation, corresponding figures have been rearranged as follows:

December 31,
2023
Transfer from Transfer to (Rupees in '000)
Aggregate

Property and equipment Right-of-use assets 19,571,852

Other liabilities Lease liability against right-of-use assets 22,093,855

41. NON-ADJUSTING EVENT

7 per share (__%).

The Board of Directors in their meeting held on April 18, 2024 has announced interim cash dividend of Rs __ 70
This condensed interim unconsolidated financial information does not include the effect of this appropriation which will be
accounted for subsequent to the quarter end.

42. DATE OF AUTHORISATION

This condensed interim financial information were authorised for issue on April 18, 2024 by the Board of Directors of the Bank.

___________________ ____________________ ___________________ ___________________ ___________________

Chairman President and Director Director Chief Financial Officer
Chief Executive
 MEEZAN BANK LIMITED

CONSOLIDATED FINANCIAL STATEMENT

FOR THE QUARTER ENDED MARCH 31, 2024
 1
MEEZAN BANK LIMITED
CONDENSED INTERIM CONSOLIDATED STATEMENT OF FINANCIAL POSITION
AS AT MARCH 31, 2024
Note
1.4 Restated
March 31, December 31,
2024 2023
(Unaudited) (Audited)

-------------------------(Rupees in '000)-------------------------
ASSETS

Cash and balances with treasury banks 231,686,134 242,612,195

Balances with other banks 13,382,740 11,458,281
Due from financial institutions 34,964,299 34,964,299
Investments 1,631,486,026 1,578,341,536
Islamic financing and related assets 896,555,304 961,673,012
Property and equipment 42,154,806 39,295,656
Right-of-use assets 19,824,102 19,867,043
Intangible assets 2,271,258 2,370,686
Deferred tax asset - -
Other assets 176,820,835 128,733,444
Total Assets 3,049,145,504 3,019,316,152

LIABILITIES

Bills payable 39,338,264 39,724,176

Due to financial institutions 332,839,285 377,494,612
Deposits and other accounts 2,269,013,473 2,217,420,536
Lease liability against right-of-use assets 22,891,376 22,412,164
Sub-ordinated sukuk 20,990,000 20,990,000
Deferred tax liabilities 2,928,413 4,881,310
Other liabilities 161,450,272 146,376,085
Total Liabilities 2,849,451,083 2,829,298,883

NET ASSETS 199,694,421 190,017,269

REPRESENTED BY

Share capital 17,912,532 17,912,532

Reserves 39,756,006 37,106,473
Surplus / (deficit) on revaluation of assets - net of tax 11,498,728 10,920,597
Unappropriated profit 128,993,656 122,528,058
198,160,922 188,467,660

NON-CONTROLLING INTEREST 1,533,499 1,549,609

199,694,421 190,017,269

The annexed notes 1 to 3 form an integral part of this condensed interim consolidated financial information.

__________ __________________________ __________ ____________ _______________________

Chairman President & Chief Executive Director Director Chief Financial Officer
 2
MEEZAN BANK LIMITED
CONDENSED INTERIM CONSOLIDATED PROFIT AND LOSS ACCOUNT (UNAUDITED)
FOR THE QUARTER ENDED MARCH 31, 2024

Note
1.4 Restated
Quarter ended Quarter ended
March 31, March 31,
2024 2023

-----------------Rupees in '000---------------
--
Profit / return earned on Islamic financing and related
assets, investments and placements 119,145,320 81,988,469
Profit on deposits and other dues expensed 51,588,995 40,920,804
Net profit / return 67,556,325 41,067,665

OTHER INCOME

Fee and commission income 5,914,978 4,044,864

Dividend income 182,647 111,252
Foreign Exchange (Loss) / Income 477,930 (155,042)
Gain / (loss) on securities 60,100 (92,060)
Net gains on derecognition of financial assets measured
at amortised cost - -
Other income 329,270 286,674
Total other income 6,964,925 4,195,688

Total income 74,521,250 45,263,353

OTHER EXPENSES

Operating expenses 20,598,165 14,519,265

Workers Welfare Fund 1,128,469 595,835
Other charges 132,596 2,828
Total other expenses 21,859,230 15,117,928
52,662,020 30,145,425
Share of profit of associates 374,589 26,463
Profit before credit loss allowance / provisions 53,036,609 30,171,888

Credit loss allowance / provisions and write offs - net (344,143) 2,129,887

Extra ordinary / unusual items - -

PROFIT BEFORE TAXATION 53,380,752 28,042,001

Taxation 27,836,462 12,515,818

PROFIT AFTER TAXATION 25,544,290 15,526,183

Attributable to:
Shareholders of the Holding company 25,420,400 15,446,339
Non-controlling interest 123,890 79,844
25,544,290 15,526,183

Rupees

Basic earnings per share 14.19 8.63

Diluted earnings per share 14.13 8.63

The annexed notes 1 to 3 form an integral part of this condensed interim consolidated financial information.

____________ ________________________________ ___________ ______________ __________________________

Chairman President & Chief Executive Director Director Chief Financial Officer
 3

MEEZAN BANK LIMITED

CONDENSED INTERIM CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME (UNAUDITED)
FOR THE QUARTER ENDED MARCH 31, 2024
Note
1.4 Restated
Quarter ended Quarter ended
March 31, March 31,
2024 2023

-----------------Rupees in '000-----------------

Profit after taxation for the quarter attributable to:

Shareholders of the Holding company 25,420,400 15,446,339
Non-controlling interest 123,890 79,844
25,544,290 15,526,183

Other Comprehensive Income

Items that may be reclassified to profit and loss account in

subsequent periods:

- Movement in deficit on revaluation of debt investments

through FVOCI - net of tax (1,764,434) -

- Gain on derecognition of Debt investments at FVOCI

– reclassified to profit or loss - net of tax (30,651) -

- Movement in deficit on revaluation of available for sale

investments - net of tax - (3,063,854)

Items that will not be reclassified to profit and loss

account in subsequent periods:

- Movement in surplus on revaluation of equity investments

through FVOCI - net of tax 17,795 -
- Gain on sale of equity shares - FVOCI 61,393

Other Comprehensive income for the quarter 23,828,393 12,462,329

Attributable to:
Shareholders of the Holding company 23,704,503 12,382,485
Non-controlling interest 123,890 79,844
23,828,393 12,462,329

The annexed notes 1 to 3 form an integral part of this condensed interim consolidated financial information.

#REF!

_____________ __________________________ ___________ __________ ________________________

Chairman President & Chief Executive Director Director Chief Financial Officer
MEEZAN BANK LIMITED
CONDENSED INTERIM CONSOLIDATED STATEMENT OF CHANGES IN EQUITY (UNAUDITED) 4
FOR THE QUARTER ENDED MARCH 31, 2024
Revenue Surplus / (deficit) on
Capital reserves
reserves revaluation of
Non Non
Share Unappro- Non-
Distributable Employee controlling Total
capital Share Statutory General priated profit Investment
Capital share option banking interest
Premium reserve * reserve s
Reserve - compensatio assets
Gain on n reserve
----------------------------------------------------------------------------------------------------(Rupees in '000)----------------------------------------------------------------------------------------------------

Balance as at January 1, 2023 17,896,243 2,406,571 22,169,518 3,117,547 427,419 91,082 72,485,599 (666,349) 2,678 1,204,382 119,134,690

Profit after taxation for the quarter ended March 31, 2023 - - - - - - 15,446,339 - - 79,844 15,526,183
Other Comprehensive loss for the quarter ended
March 31, 2023 - net of tax
- Movement in surplus / (deficit) on revaluation of
available for sale investments - net of tax - - - - - - - (3,063,854) - - (3,063,854)
Total other comprehensive income - net of tax - - - - - - - (3,063,854) - - (3,063,854)

Transfer from surplus in respect of incremental depreciation of

Non-banking assets to unappropriated profit - net of tax - - - - - - 3 - (3) - -
Recognition of share based compensation - - - - 85,366 - - - - - 85,366

Other appropriations
Transfer to statutory reserve* - - 1,542,417 - - - (1,542,417) - - - -
Transactions with owners recognised directly in equity
Final cash dividend for the year 2022 @ Rs 3 per share - - - - - - (5,368,873) - - - (5,368,873)
Dividend payout by Subsidiary - - - - - - - - - (70,000) (70,000)
Balance as at March 31, 2023 17,896,243 2,406,571 23,711,935 3,117,547 512,785 91,082 81,020,651 (3,730,203) 2,675 1,214,226 126,243,512

Profit after taxation for the nine months period end December 31, 2023 - - - - - - 69,984,211 - - 512,742 70,496,953
Other Comprehensive income / (loss) for the nine months period ended
December 31, 2023 - net of tax
- Movement in surplus / (deficit) on revaluation of
available for sale investments - net of tax - - - - - - - 14,650,800 - - 14,650,800
- Remeasurement gain / (loss) on defined benefit
obligations - net of tax - - - - - - (127,890) - - (2,359) (130,249)
- Movement in surplus on revaluation of non-banking
assets - net of tax - - - - - - - - (2,674) - (2,674)
Total other comprehensive (loss) / income - net of tax - - - - - - (127,890) 14,650,800 (2,674) (2,359) 14,517,877
Transfer from surplus in respect of incremental depreciation of
Non-banking assets to unappropriated profit - net of tax - - - - - - 1 - (1) - -
Recognition of share based compensation - - - - 324,380 - - - - - 324,380
Other appropriations
Transfer to statutory reserve* - - 6,905,147 - - - (6,905,147) - - - -
Transactions with owners recognised
directly in equity
First Interim cash dividend for the year 2023 @ Rs 3 per share - - - - - - (5,368,873) - - - (5,368,873)
Second Interim cash dividend for the year 2023 @ Rs 4 per share - - - - - - (7,165,013) - - - (7,165,013)
Thrid intereim cash dividend for the year 2023 @ Rs. 5 per share - - - - - - (8,956,266) - - - (8,956,266)
- - - - - - (21,490,152) - - - (21,490,152)

Dividend payout by Subsidiary - - - - - - - - - (175,000) (175,000)

Issue of 1,628,873 shares under the Employees share option scheme 16,289 219,870 - - (182,844) - 46,384 - - - 99,699

Balance as at December 31, 2023 17,912,532 2,626,441 30,617,082 3,117,547 654,321 91,082 122,528,058 10,920,597 - 1,549,609 190,017,269

Impact of adoption of IFRS 9 - net of tax (Note 1.4) - - - - - - (2,145,490) 2,355,421 - - 209,931

Profit after taxation for the quarter ended March 31, 2024 - - - - - - 25,420,400 - - 123,890 25,544,290
Other Comprehensive loss for the quarter ended
March 31, 2024 - net of tax

- Movement in deficit on revaluation of investments

in debt instruments at FVOCI - net of tax - - - - - - - (1,764,434) - - (1,764,434)
- Gain on derecognition of Debt investments at FVOCI
– reclassified to profit or loss - net of tax - - - - - - - (30,651) - - (30,651)
- Movement in surplus on revaluation of investments
in equity instruments at FVOCI - net of tax - - - - - - 61,393 17,795 - - 79,188
Total other comprehensive income / (loss) - net of tax - - - - - - 61,393 (1,777,290) - - (1,715,897)

Recognition of share based compensation - - - - 108,854 - - - - - 108,854

Other appropriations
Transfer to statutory reserve* - - 2,540,679 - - - (2,540,679) - - - -
Transactions with owners recognised directly in equity
Final cash dividend for the year 2023 @ Rs 8 per share - - - - - - (14,330,026) - - - (14,330,026)
Dividend payout by Subsidiary - - - - - - - - - (140,000) (140,000)
Balance as at March 31, 2024 17,912,532 2,626,441 33,157,761 3,117,547 763,175 91,082 128,993,656 11,498,728 - 1,533,499 199,694,421

- - - - -
*This represents reserve created under section 21(i)(b) of the Banking Companies Ordinance ,1962.

The annexed notes 1 to 3 form an integral part of this condensed interim consolidated financial information.

Chairman President & Chief Executive Director Director Chief Financial Officer
 5
MEEZAN BANK LIMITED
CONDENSED INTERIM CONSOLIDATED CASH FLOW STATEMENT (UNAUDITED)
FOR THE QUARTER ENDED MARCH 31, 2024
Note
1.4 Restated
Quarter ended Quarter ended
March 31, March 31,
2024 2023
---------------(Rupees in '000)------------------
CASH FLOW FROM OPERATING ACTIVITIES

Profit before taxation 53,380,752 27,816,909

Less: Dividend income (182,647) (111,252)
53,198,105 27,705,657
Adjustments for non-cash charges and other items:
Depreciation 1,350,305 960,218
Net profit / return (68,451,535) (41,490,648)
Amortization 165,435 123,527
Non cash items related to right-of-use assets 1,536,943 1,167,773
Credit loss allowance / provisions / reversals and write offs - net (344,143) 2,405,963
Share based compensation expense 108,854 85,366
Gain on sale of operating fixed assets (151,061) (64,296)
Share of results of associates (374,589) (26,463)
(66,159,791) (36,838,560)
(12,961,686) (9,132,903)
(Increase) / decrease in operating assets
Due from financial institutions - -
Islamic financing and related assets 61,134,897 (31,012,421)
Other assets (5,982,221) (6,664,938)
55,152,676 (37,677,359)
Increase / (decrease) in operating liabilities
Bills payable (385,912) (266,849)
Due to financial institutions (44,655,327) 27,964,041
Deposits and other accounts 51,592,937 132,703,315
Other liabilities (5,981,387) (45,486,335)
570,311 114,914,172
42,761,301 68,103,910
Net profit / return received 76,818,879 43,115,413
Net profit / return paid (51,545,188) (37,421,330)
Income tax paid (20,770,278) (12,315,364)
Net cash generated from operating activities 47,264,714 61,482,629

CASH FLOW FROM INVESTING ACTIVITIES

Net investments in securities (51,125,572) (3,642,827)

Dividends received 182,647 72,557
Investments in operating fixed assets (4,306,077) (2,002,753)
Investments in intangible assets (66,007) (103,823)
Proceeds from sale of fixed assets 247,683 106,068
Net cash used in investing activities (55,067,326) (5,570,778)

CASH FLOW FROM FINANCING ACTIVITIES

Payment of lease liability against right-of-use assets (1,014,789) (959,445)
Dividend paid to equity shareholders of the Bank (370) (409)
Dividend paid to non-controlling interest (140,000) (70,000)
Net cash used in financing activities (1,155,159) (1,029,854)

Increase / (decrease) in cash and cash equivalents (8,957,771) 54,881,997

ECL impact of adoption of IFRS 9 on cash and cash equivalents (43,831) -

Cash and cash equivalents at the beginning of the quarter 254,070,476 131,454,425
Cash and cash equivalents at the end of the quarter 245,068,874 186,336,422

The annexed notes 1 to 3 form an integral part of this condensed interim consolidated financial information.

Chairman President & Chief Director Director Chief Financial Officer

Executive
 6

MEEZAN BANK LIMITED

NOTES TO AND FORMING PART OF CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
FOR THE QUARTER ENDED MARCH 31, 2024

1 BASIS OF PRESENTATION

1.1 This condensed interim consolidated financial information include the unaudited financial statements of Meezan Bank Limited (MBL) (the holding
company), Al-Meezan Investment Management Limited (the subsidiary) and Meezan Exchange Company (Private) Limited (the subsidiary) collectively
referred as the ‘Group’ and associates namely, Al-Meezan Mutual Fund, Meezan Islamic Fund, Meezan Islamic Income Fund, Meezan Tahaffuz
Pension Fund, KSE Meezan Index Fund, Meezan Balanced Fund, Meezan Financial Planning Fund of Funds, Meezan Strategic Allocation Fund II,
Meezan Gold Fund, Meezan Energy Fund, Meezan Strategic Allocation Fund III, Meezan Rozana Amdani Fund, Meezan Pakistan Exchange Traded
Fund, Meezan Daily Income Fund, Meezan Paidar Munafa Plan and Meezan GOKP Pension Fund.

1.2 This condensed interim consolidated financial information has been prepared in accordance with the requirements of International Accounting
Standard (IAS) 34 ‘Interim Financial Reporting’.

1.3 This condensed interim consolidated financial information comprise of the statement of financial position as at March 31, 2024 and the profit and loss
account, statement of comprehensive income, statement of changes in equity and the cash flow statement for the quarter ended March 31, 2024.

1.4 Adoption of new forms for the preparation of condensed interim financial information

The SBP, vide its BPRD Circular No. 02 dated February 09, 2023, issued the revised forms for the preparation of the condensed interim quarterly /
half yearly financial information of the banks which are applicable for quarterly / half yearly periods beginning on or after January 01, 2024 (previously
January 01, 2023). The implementation of the revised forms has resulted in certain changes to the presentation and disclosures of various elements of
the condensed interim consolidated financial information.

1.4.1 IFRS 9 - 'Financial Instruments'

As directed by the SBP via BPRD Circular no 7 of 2023, IFRS 9, 'Financial Instruments' is effective for periods beginning on or after January 1, 2024
(previously January 01, 2023) for banks having asset base of more than Rs 500 billion as at December 31, 2022. Moreover, SBP has also issued
application instructions on IFRS 9 for banks in Pakistan for ensuring smooth and consistent implementation of the standard in the banks. The Group
has adopted IFRS 9 effective from January 01, 2024.

2 ACCOUNTING POLICIES

2.1 The accounting policies and the methods of computation adopted in the preparation of this condensed interim consolidated financial information are
the same as those applied in the preparation of the Group for the year ended December 31, 2023.

3 DATE OF AUTHORISATION

This condensed interim consolidated financial information was authorized for issue on April 18, 2024 by the Board of Directors of the Holding
company.

Chairman President & Chief Executive Director Director Chief Financial Officer