Askari Bank : Transmission of Quarterly Report for the Period Ended

Contents

Directors' Review	1
Directors' Review (Urdu)	6
Unconsolidated Condensed Interim Statement of Financial Position	7
Unconsolidated Condensed Interim Profit and Loss Account	8
Unconsolidated Condensed Interim Statement of Comprehensive Income	9
Unconsolidated Condensed Interim Statement of Changes in Equity	10
Unconsolidated Condensed Interim Cash Flow Statement	11
Notes to the Unconsolidated Condensed Interim Financial Statements	12
Consolidated Condensed Interim Statement of Financial Position	40
Consolidated Condensed Interim Profit and Loss Account	41
Consolidated Condensed Interim Statement of Comprehensive Income	42
Consolidated Condensed Interim Statement of Changes in Equity	43
Consolidated Condensed Interim Cash Flow Statement	44
Notes to the Consolidated Condensed Interim Financial Statements	45

Corporate Information

Board Of Directors	Lt. Gen Anwar Ali Hyder, HI(M) (Retd) - Chairman
	Mr. Jahangir Piracha
	Mr. Arif Ur Rehman
	Lt. Gen Ghayur Mahmood Awan, HI(M) T Bt (Retd)
	Syed Bakhtiyar Kazmi
	Mr. Manzoor Ahmed
	Raja Muhammad Abbas
	Ms. Zoya Mohsin Nathani
	Mr. Kamran Yousuf Mirza
	Ms. Samina Rizwan
	Mr. Atif R. Bokhari - President & Chief Executive
Board Audit Committee	Mr. Kamran Yousuf Mirza - Chairman
	Lt. Gen Ghayur Mahmood Awan, HI(M) T Bt (Retd)
	Syed Bakhtiyar Kazmi
	Mr. Manzoor Ahmed
	Raja Muhammad Abbas
Auditors	KPMG Taseer Hadi & Co.
	Chartered Accountants
Legal Advisors	M/s RIAA, Barker Gillette
	Advocates & Corporate Counselors
Company Secretary	Syed Ali Safdar Naqvi
Registered Office	AWT Plaza, The Mall, P. O. Box No. 1084
	Rawalpindi - 46000, Pakistan
	Tel: [phone], UAN: (92 51) 111 000 787
	Fax: [phone]
	Email: [e-mail]
Registrar & Share Transfer Office	CDC Share Registrar Services Limited (CDCSRSL)
	Mezzanine Floor, South Tower, LSE Plaza
	19-Khayaban-e-Aiwan-e-Iqbal, Lahore
	Tel: Customer Support Services (Toll Free)
	0800-CDCPL (23275)
	Tel: [phone]
	Fax: [phone]
	Email: [e-mail]
	Website: www.cdcsrsl.com
Entity Ratings	Long Term: AA+
	Short Term: A1+
	By PACRA
Website	www.askaribank.com
Social Media	askaribankpakistan
	Askari_Bank
	askaribankpk
	askaribanklimited
	AskariBankOfficial

DIRECTORS' REVIEW

Dear Shareholders

The Directors present the unaudited condensed interim unconsolidated financial statements for the first quarter ended March 31, 2024.

At the outset, we would like to inform that the composition of the Board of Directors has changed. We take this opportunity to place on record our profound appreciation for the valuable services of outgoing directors, Mr. Waqar Ahmed Malik, Dr Nadeem Inayat and Mr. Sarfaraz Ahmed Rehman. We further extend a very warm welcome to incoming directors, Lt Gen Ghayur Mahmood Awan (Retd), Syed Bakhtiyar Kazmi and Mr. Jahangir Piracha and look forward to their wise council on the Board of Directors.

Economy:

The latest economic indicators depict a moderate pick-up in activity on the back of better prospects for agriculture, notable improvement in current account, external inflows including IMF SBA tranche and improved confidence despite tight monetary and fiscal policy and continued import management. However, macroeconomic risks remain high amid a large debt burden and limited foreign exchange reserves.

Inflation has begun to decelerated in line with expectations, though the levels remain high and the outlook is susceptible to risks contingent upon targeted fiscal consolidation, timely realization of external inflows and the trends of commodity prices in view of continued geopolitical tensions. Given the uncertainty regarding the inflation outlook, key central banks in both advanced and emerging economies have continued to maintain a cautious monetary policy stance. SBP MPC's recent announcement is also reflecting a cautious approach as the policy rate was kept unchanged at 22 percent.

On the external front, current account posted a deficit of USD 1.0 billion for the eight months of current fiscal year against USD 3.9 billion for the same period last year reflecting an improvement in trade balance. Trade deficit for the current period at USD 13.5 billion compares with USD 18.7 billion last year as both import and exports are showing positive variances. Remittances recorded a marginal decline for the current fiscal year; however, the trend is expected to improve due to eid and seasonal factor.

Looking ahead, Pakistan's GDP growth is expected to remain below potential at around 1.8 percent for the current fiscal year ending June 2024 as recent indicators remain fragile due to persistent inflation and elevated interest rates. The structural reforms needed to improve the economic outlook demand a clearly articulated implementation plan that is credible and targets quick progress as an imperative to restore confidence. Improved fiscal management remains pivotal to address inflation, narrow the current account deficit, improve financial sector

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stability and increase credit to the private sector, all of which are critical for robust economic recovery

Financial Performance:

The financial results of the Bank for the first quarter ended March 31, 2024 are summarized as under:

		(Rupees in million)
	Three months ended March 31,
	2024	2023
Net mark-up and non fund income	16,627	15,076
Administrative and other expenses	(8,114)	(6,783)
Operating profit	8,513	8,294
Credit loss allowarnce / provisions and write offs - net	(1,174)	58
Profit before taxation	7,339	8,352
Taxation	(3,624)	(3,648)
Profit after taxation	3,715	4,703
Basic earnings per share - Rupees	2.56	3.25

Profit before provisions for the quarter ended March 31, 2024 at Rs.8.5 billion is showing an increase of 3 percent year-on-year. Profit before taxation is showing a decline of 12 percent mainly due to increase in credit loss allowance / provisions against non-performing assets. Profit after taxation declined by 21 due to a higher taxation rate in comparison with the corresponding period last year. The earnings per share at Rs.2.56 for the current period compares with Rs.3.25 for last year.

Net aggregate revenues increased by 10 percent over the same period last year mainly contributed by mark-up income which grew by 8 percent to Rs.12.9 billion. The increase in mark-up income was mainly driven by growth in earning assets partially offset by changes in market rates adversely impacting net spreads for the current quarter. Aggregate non-markup income increased by 20 percent year-on-year; mainly contributed by gains from investment and foreign exchange income. Operating expenses for the current quarter increased by 20 mainly due to the effect of inflation and Rupee devaluation, and also due to additional costs of 60 new branches added to the nation-wide network during the last twelve months. The Bank continues to manage costs prudently while investing in technologies and infrastructure to support revenue streams.

The Bank's deposits closed at Rs.1.3 trillion at March 31, 2024 with current and saving accounts constituting 84 percent of the total deposit at period end. Advances registered a growth of 8.6 percent during the quarter, from Rs. 633 billion at year end 2023 to Rs 687 billion. The economic stress on certain borrowers warranted additional classifications. Accordingly, a net provision of Rs.1.17 billion has been charged against the profit for the

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quarter in review. During the quarter, the Bank has adopted IFRS9 as per regulatory guidance and requisite financial disclosures have been made in the annexed financial statements.

The Bank's entity rating was reaffirmed at 'AA+' (Double A Plus) for the long-term by Pakistan Credit Rating Agency Limited (PACRA), with outlook assigned as 'Stable'. The Bank's strong brand and affiliation with Fauji Foundation are recognized as the key rating drivers, supported by Bank's experienced management team, prudent risk management policies, and deep-rooted relationship with clients. Lately, retention of profits in the bank to bolster the capital structure is also a testimonial of support. The short-term rating was maintained at 'A1+' (A One Plus).

Askari Bank is strategically positioned for sustainable growth and remains committed towards building long-term shareholder value, despite macroeconomic challenges. Risk management will remain the key across all lines of businesses and the strategies will focus on being risk aware and not risk wary as challenges remain largely weighed to the downside. The Bank is expanding its footprint, to grow market share in retail segment, particularly low-cost and saving deposits. The Bank will continue to pursue strong governance and compliance discipline. Customer experience remains a key priority aided by continued initiatives in the areas of process improvements, digitization, automation and data analytics. To this end, the Bank will continue to invest in talent and technology enabling its teams to do more to help our customers achieve their ambitions and in-turn drive Askari Bank to grow in the future.

Acknowledgment:

On behalf of the Board, we would like to place on record our gratitude to our valued customers and shareholders for their continued patronage to the Askari brand; our profound thanks to the State Bank of Pakistan, Securities and Exchange Commission of Pakistan and other regulatory authorities for their guidance and assistance. We would also like to place on record our appreciation for the efforts of the Shariah Board for strengthening shariah compliance and governance framework for Askari Ikhlas Islamic Banking. Lastly, we express our deepest appreciation and gratitude to our staff for the hard work and dedication.

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President & Chief Executive	Chairman, Board of Directors
Rawalpindi: April 30, 2024

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2.56

5

6

ASKARI BANK LIMITED

Unconsolidated Condensed Interim Statement of Financial Position As at March 31, 2024

Note

ASSETS

(Un-audited)		(Audited)
March 31,		December 31,
2024	2023

(Rupees in '000)

Cash and balances with treasury banks	6
Balances with other banks	7
Lendings to financial institutions	8
Investments	9
Advances	10
Property and equipment	11
Righ-of-use assets	12
Intangible assets	13
Assets held for sale	14
Deferred tax assets	15
Other assets	16
LIABILITIES
Bills payable	17
Borrowings	18
Deposits and other accounts	19
Lease liabilities	20
Subordinated debts	21
Other liabilities	22
NET ASSETS
REPRESENTED BY
Share capital
Reserves
Surplus on revaluation of assets - net of tax	23
Unappropriated profit
CONTINGENCIES AND COMMITMENTS	24

132,080,116

13,088,650

1,492,003

1,321,232,200

687,413,783

19,531,380

9,078,172

1,874,859

1,750,000

13,065,501

115,480,376

2,316,087,040

10,151,165

829,829,766

1,301,360,197

10,712,667

12,000,000

59,422,138

2,223,475,933

92,611,107

14,492,992

69,665,607

5,108,956

3,343,552

92,611,107

160,087,394

13,789,031

-

1,182,537,688

633,132,827

18,698,072

8,312,812

1,855,607

1,750,000

8,072,702

95,769,826

2,124,005,959

12,394,336

643,362,665

1,293,145,575

9,699,474

12,000,000

56,281,088

2,026,883,138

97,122,821

14,492,992

57,739,655

4,458,362

20,431,812

97,122,821

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

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Chief Financial Officer	President & Chief Executive	Director	Director	Chairman
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