Half Yearly Report 2012

aspire
Condensed Interim Financial Statements

for the half year ended June 30, 2012
A
Contents
Corporate Information.........................................................................................................02
Vision, Mission & Core Values............................................................................................03
Directors’ Review...................................................................................................................04
Independent auditors’ report to the share holders on review of
interim financial information............................................................................................. 07
Unconsolidated Condensed Interim Financial Statements of

Allied Bank Limited
Unconsolidated Condensed Interim Statement of Financial Position.................08

Unconsolidated Condensed Interim Profit and Loss Account.................................09
Unconsolidated Condensed Interim Statement of Comprehensive Income.......10
Unconsolidated Condensed Interim Statement of Cash Flows................................. 11
Unconsolidated Condensed Interim Statement of Changes in Equity.................. 12
Notes to the Unconsolidated Condensed Interim Financial Statements............. 13
Consolidated Condensed Interim Financial Statements of

Allied Bank Limited and its Subsidiary
Consolidated Condensed Interim Statement of Financial Position....................... 25

Consolidated Condensed Interim Profit and Loss Account......................................26
Consolidated Condensed Interim Statement of Comprehensive Income........... 27
Consolidated Condensed Interim Statement of Cash Flows....................................28
Consolidated Condensed Interim Statement of Changes in Equity......................29
Notes to the Consolidated Condensed Interim Financial Statements.................30
1
Corporate Information
Board of Directors Company Secretary

Mohammad Naeem Mukhtar Muhammad Raffat
Chairman / Non Executive Director
Sheikh Mukhtar Ahmad Auditors

Non Executive Director
Ernst & Young Ford Rhodes
Muhammad Waseem Mukhtar Sidat Hyder
Non Executive Director Chartered Accountants
Abdul Aziz Khan

Independent Director KPMG Taseer Hadi & Co.
Chartered Accountants
Mubashir A. Akhtar
Independent Director Legal Adviser
Pervaiz Iqbal Butt Haidermota and Company,

Barrister-at-Law & Corporate Counsellors
Independent Director
A. Akbar Sharifzada Shares Registrar

(Govt. Nominee Director)
Technology Trade (Pvt.) Ltd.
Sheikh Jalees Ahmed
Executive Director Registered / Head Office
3-4 Tipu Block, Main Boulevard
Khalid A. Sherwani
Chief Executive Officer
New Garden Town
Lahore - Pakistan
(92 42) 35880043

Audit Committee
Website & Email
Mubashir A. Akhtar www.abl.com
Chairman
info@abl.com
Pervaiz Iqbal Butt
Member Toll Free Number
0800-22522
A. Akbar Sharifzada
Member
Sheikh Jalees Ahmed

Member
2
Vision, Mission & Core Values
Vision
To become a dynamic and efficient bank providing integrated solutions in order to be the first
choice bank for the customers
Mission
To provide value added services to our customers
To provide high tech innovative solutions to meet customers’ requirements
To create sustainable value through growth, efficiency and diversity for all stakeholders
To provide a challenging work environment and reward dedicated team members according to
their abilities and performance
To play a proactive role in contributing towards the society
Core Values
Integrity
Excellence in Service
High Performance
Innovation and Growth
3
Directors’ Review
Dear Shareholders,
On behalf of the Board of Directors, we are pleased to present the financial results of Allied Bank
Limited for the half year ended June 30, 2012:
Financial Highlights
(Rupees in million)
Half Year ended June 30,
Growth
2012 2011
Profit after tax for the period 6,653 5,033 32.19%
Accumulated profits brought forward 20,255 15,828 27.96%
Transfer from surplus on revaluation of fixed assets
- net of tax 15 15 0.00%
Profit available for appropriation 26,923 20,876 28.96%
Final cash dividend for the year ended Dec 31, 2011 at
Rs. 2.5 per share (2011: year ended Dec 31, 2010 at
Rs. 2.5 per share) (2,151) (1,564) 37.53%
Interim Cash dividend for the year ending Dec 31, 2012 at
Rs. 2.0 per share (1,893) - 100%
Transfer to reserve for issue of bonus shares for the
year ended Dec 31, 2011 @ 10% (658) - 100%
Transfer to Statutory Reserves (1,331) (1,007) 32.17%
Un-appropriated profits carried forward 20,890 18,305 14.12%
Earnings Per Share (EPS) Rs. 7.03 5.32 32.19%
The Board is pleased to announce second interim cash dividend of Rs. 1.5 per share in addition to
first interim cash dividend of Rs. 2 per share already paid (Interim Cash dividend for the half year
ended June 30, 2012 is Rs. 3.5 per share; June 30, 2011: Rs. 2.5 per share).
Economic Overview
The challenges to the macroeconomic outlook have been prevailing for a long time, reflected
by low growth, persistently high inflation, vulnerable external account position and weak fiscal
fundamentals. Severe energy shortages and sensitive security condition of the country have
further impacted the economic output and slowed the overall recovery process. Meanwhile, the
uncertainties associated with global economy have also added to the challenges.
The provisional estimates show a real GDP growth of 3.7% in FY12 against the revised target
of 4.2%. Importantly, total investments, export of goods and services sector showed a notable
contraction. The shortfall in both tax and non-tax revenues and subsidy overruns dragged the
budget deficit for FY12 to an estimated 6.4% of GDP (excluding commodity and energy subsidy
arrears at 1.9% of GDP).
The YoY CPI inflation for FY12 of 11% was well within expectations, primarily attributable
to reduction in real private investment. However, it remained in double digits for the fifth
consecutive year.
4
The monetization of budget deficit through domestic sources, amidst limited external funding,
increased the outstanding stock of government borrowings from scheduled banks, contributing
to more than two-third of the growth in M2 of 14.1% during FY12. The resultant crowding out of
the private sector credit coupled with limited appetite of the businesses for credit in the wake of
difficult operating environment led to substantial contraction in net flow of private sector credit.
Recognizing the need to support private sector credit and revive investment in the economy
and comforted by recent inflationary trends and forecast for FY13, SBP in its recent Monetary
Statement of August 10, 2012 lowered the discount rate by 150 bps to 10.5%.
Financial Review
Under the current challenging circumstances, Your Bank remained committed to its strategy of
improving the mix of deposits and deploying resources in quality avenues. Deposits of Your Bank
increased to Rs. 454,592 million as at June 30, 2012, a growth of 13.7% over December 31, 2011
and 11.8% over June 30, 2011. The share of Non-Remunerative Current Accounts and lower cost
Savings Deposits in the total deposits mix increased from 56.5% as at June 30, 2011 to 57.1% as
at June 30, 2012. Gross Investments increased to Rs. 201,148 million as at June 30, 2012 from Rs.
198,398 million as at December 31, 2011 and Rs. 146,009 million as at June 30, 2011. The Gross
Advances as at June 30, 2012 registered a growth of Rs. 16,114 million or 6.1% over December 31,
2011 and were higher by Rs. 20,142 million or 7.8% over June 30, 2011 level, to reach Rs. 278, 251
million. The balance sheet size of Your Bank stands at Rs. 556,299 million, while the Equity of the
Bank as at June 30, 2012 registered a growth of 7.5% and 15.7% over December 31, 2011 and June
30, 2012 levels, respectively, to reach Rs. 46,609 million.
Profit Before Tax of Your Bank increased to Rs. 9,415 million during half year ended June 30,
2012 (1H 2012) as compared to Rs. 7,563 million in the corresponding half of previous year, a
YoY growth of 24.4%. Profit After Tax rose by 32.1% to Rs. 6,653 million during 1H 2012 compared
to Rs. 5,033 million in the corresponding half of previous year. Resultantly, the EPS of Your Bank
increased to Rs. 7.03 during the half year ended June 30, 2012 compared to Rs. 5.32 in the
corresponding half of previous year.
Net Mark-up / Interest Income during the half year ended June 30, 2012 decreased by Rs. 2,417
million to Rs. 9,959 million compared to Rs. 12,376 million in the corresponding half of previous
year, attributable mainly to higher deployment of funds towards dividend bearing investment
activities. The provision expense during 1H 2012 declined by 73.2% on YoY basis to Rs. 301 million
compared to Rs. 1,124 mln in the corresponding half of previous year.
Non-Mark up / Interest Income during 1H 2012 more than doubled compared to the
corresponding half of previous year to Rs. 6,862 million, attributable to the higher funds
deployment in investment avenues and realization of gains on listed equity portfolio. The
Operating Expenses increased by 6.1% to Rs. 7,106 million during 1H 2012 compared to Rs.
6,696 million in the corresponding half of previous year. The growth rate when compared
with inflationary trends and increasing outlays on infrastructure strengthening and systems
upgradation reflect the effectiveness of the management strategies in controlling costs. NPLs
increased by 2.6% from December 31, 2011 level to Rs. 20,984 million. However, Your Bank has
adequately provided for the NPLs with provision coverage remaining high at 83.3% as at June
30, 2012 and no benefit of FSV has been taken while determining the provision against NPLs as
allowed under BSD Circular No. 02 of 2010 dated June 03, 2010.
5
Future Outlook:
The prospects of economic revival and financial stability remain challenging. Your Bank being
cognizant of the given environment would continue with its strategy of sustained growth in
quality avenues while at the same time fortifying the risk management function and control
processes. Meanwhile, focus would remain on improving the deposits mix and optimizing
operational efficiencies. Further, effective capitalization on the extensive network, improving
service quality standards and providing state of the art banking services through product
innovation and leveraging technology would remain our key strategic focus areas.
Entity & TFC Ratings

The Pakistan Credit Rating Agency Limited (PACRA) has upgraded the long-term rating of Allied
Bank to AA+ (Double A Plus) [Previous Rating: “AA”]. The short-term rating of the Bank is already
at the highest level of “A1+” (A One Plus). The rating of TFC Issue of Rs. 3,000 million (Issue
Date: August 28, 2009) has also been upgraded to AA (Double A). The ratings denote very low
expectation of credit risk emanating from a very strong capacity for timely payment of financial
commitments.
Meanwhile, the rating of Bank’s earlier TFC Issue of Rs. 2,500 million (Issue Date: December 06,
2006) is AA- (Double A Minus) assigned by JCR-VIS Credit Rating Company (JCR-VIS).
Corporate Governance Rating

Your Bank has a Corporate Governance rating of CGR-8+, assigned by JCR-VIS, which denotes a
high level of corporate governance.
Best Investment Bank Award – Euromoney

Your Bank won the Best Investment Bank of the Year Award - Pakistan from Euromoney, the
world’s leading financial markets magazine.
Acknowledgement:
We take this opportunity to thank our valued customers for their patronage, to our employees for
their continued commitment, our shareholders for their trust and confidence and State Bank of
Pakistan and other regulatory bodies for their continued guidance.
For and on behalf of the Board,
Khalid Ahmed Sherwani

Chief Executive Officer

Date: August 16, 2012
Place: Lahore
6
ERNST & YOUNG FORD RHODES SIDAT HYDER KPMG TASEER HADI & Co.
Chartered Accountants Chartered Accountants
Mall View Building 53 L, Gulberg-III
4 - Bank Square, Lahore Lahore

INDEPENDENT AUDITORS’ REPORT TO THE SHARE HOLDERS
ON REVIEW OF INTERIM FINANCIAL INFORMATION
Introduction
We have reviewed the accompanying unconsolidated condensed interim statement of financial
position of the Allied Bank Limited (the Bank) as at 30 June 2012 and the related unconsolidated
condensed interim profit and loss account, unconsolidated condensed interim statement
of comprehensive income, unconsolidated condensed interim statement of cash flows,
unconsolidated condensed interim statement of changes in equity and the notes to the accounts
for the six month period then ended (here-in-after referred to as “interim financial information”).
Management is responsible for the preparation and fair presentation of this interim financial
information in accordance with approved accounting standards as applicable in Pakistan. Our
responsibility is to express a conclusion on this interim financial information based on our review.
Scope of Review
We conducted our review in accordance with the International Standard on Review Engagements
2410, “Review of Interim Financial Information performed by the Independent Auditor of the
entity”. A review of interim financial information consist of making inquiries, primarily of persons
responsible for financial and accounting matters, and applying analytical and other review
procedures. A review is substantially less in scope than an audit conducted in accordance with
International Standards on Auditing and consequently does not enable us to obtain assurance
that we would become aware of all significant matters that might be identified in an audit.
Accordingly we do not express an audit opinion.
Conclusion
Based on our review, nothing has come to our attention that causes us to believe that the
accompanying interim financial information is not prepared, in all material respects, in
accordance with the approved accounting standards as applicable in Pakistan for interim
financial reporting.
Other Matter
The figures of the unconsolidated condensed interim profit and loss account and
unconsolidated condensed interim statement of comprehensive income for the quarters ended
30 June 2012 and 2011 have not been reviewed and we do not express a conclusion on them,
as we are required to review only the cumulative figures for the half year ended 30 June 2012.
Ernst & Young Ford Rhodes Sidat Hyder KPMG Taseer Hadi & Co.
Chartered Accountants Chartered Accountants

Engagement Partner: Engagement Partner:
Naseem Akbar Kamran I. Yousafi

Date : 16 August, 2012
Place : Lahore
7
Unconsolidated Condensed Interim Statement of Financial Position
as at June 30, 2012
Un-audited Audited
Note June 30, December 31,
2012 2011
Rupees in ‘000
ASSETS
Cash and balances with treasury banks 41,890,508 36,479,758
Balances with other banks 1,673,694 1,679,085
Lendings to financial institutions 6 13,254,435 1,361,754
Investments 7 199,142,078 195,694,122
Advances 8 260,711,294 244,433,474
Operating fixed assets 19,307,972 18,087,011
Deferred tax assets 814,017 751,908
Other assets 19,504,697 17,211,827
556,298,695 515,698,939

LIABILITIES
Bills payable 3,994,599 4,015,317
Borrowings from financial institutions 9 32,391,576 49,993,200
Deposits and other accounts 10 454,591,855 399,561,676
Sub-ordinated loans 5,491,500 5,492,600
Liabilities against assets subject to finance lease - -
Deferred tax liabilities - -
Other liabilities 13,220,067 13,296,342
509,689,597 472,359,135
NET ASSETS 46,609,098 43,339,804

REPRESENTED BY:
Share capital 11 9,463,421 8,603,110
Reserves 9,891,451 8,762,745
Unappropriated profit 20,890,347 20,254,503
40,245,219 37,620,358
Surplus on revaluation of assets - net of tax 6,363,879 5,719,446
46,609,098 43,339,804

CONTINGENCIES AND COMMITMENTS 12

The annexed notes 1 to 19 form an integral part of these unconsolidated condensed interim financial statements.
Chief Financial Officer President and Chief Executive Officer
Director Director Chairman
8 Condensed Interim Financial Statements

Unconsolidated Condensed Interim Profit and Loss Account
(Un-audited) for the half year ended June 30, 2012
Half Year Ended Quarter Ended

Note June 30, June 30, June 30, June 30,
2012 2011 2012 2011
Rupees in ‘000
Mark-up / return / interest earned 13 24,378,492 24,572,858 12,386,414 12,280,188

Mark-up / return / interest expensed 14 14,419,048 12,196,500 7,309,014 6,102,637
Net mark-up / interest income 9,959,444 12,376,358 5,077,400 6,177,551

Provision against non-performing loans and
advances and general provision - net 874,030 1,039,519 303,434 649,909
(Reversal) / provision for diminution in
the value of investments - net (592,813) (47,038) 17,629 30,921
Bad debts written off directly - - - -
281,217 992,481 321,063 680,830
Net mark-up / interest income after provisions 9,678,227 11,383,877 4,756,337 5,496,721

NON MARK-UP / INTEREST INCOME
Fee, commission and brokerage income 1,382,204 1,487,856 660,384 739,414
Dividend income 3,329,282 758,690 1,612,046 431,873
Income from dealing in foreign currencies 293,820 370,514 156,149 270,504
Gain / (Loss) on sale of securities 1,735,640 369,385 1,491,172 101,311
Unrealized (loss) / gain on revaluation of
investments classified as held-for-trading - net (792) (797) 203 (797)
Other income 121,763 22,596 51,470 12,997
Total non-markup / interest income 6,861,917 3,008,244 3,971,424 1,555,302
16,540,144 14,392,121 8,727,761 7,052,023

NON MARK-UP / INTEREST EXPENSES
Administrative expenses 6,854,964 6,372,690 3,507,078 3,079,768
(Reversal) / provision against other assets - net (6,542) 156,871 82,000 144,871
Provision / (reversal) against off-balance
sheet obligations - net 25,894 (24,866) (30,758) (1,750)
Other charges 250,702 323,659 121,940 116,056

Total non-markup / interest expenses 7,125,018 6,828,354 3,680,260 3,338,945
Extra-ordinary / unusual items - - - -
PROFIT BEFORE TAXATION 9,415,126 7,563,767 5,047,501 3,713,078

Taxation
Current 2,886,665 2,788,618 1,453,521 1,360,719
Prior years - - - -
Deferred (124,347) (257,739) (14,496) (169,556)
2,762,318 2,530,879 1,439,025 1,191,163
PROFIT AFTER TAXATION 6,652,808 5,032,888 3,608,476 2,521,915

Restated Restated
Earnings per share - Basic and Diluted (in Rupees) 15 7.03 5.32 3.81 2.66
9
Unconsolidated Condensed Interim Statement of Comprehensive Income

June 30, June 30, June 30, June 30,
2012 2011 2012 2011
Rupees in ‘000
Profit after taxation for the period 6,652,808 5,032,888 3,608,476 2,521,915

Other comprehensive income - - - -

Total comprehensive income for the period 6,652,808 5,032,888 3,608,476 2,521,915

Surplus / (deficit) on revaluation of ‘Available for sale’ securities and ‘Fixed assets’ are presented under a separate
head below equity as ‘surplus / (deficit) on revaluation of assets’ in accordance with the requirements specified by the
State Bank of Pakistan vide its BSD Circular No. 20 dated August 04, 2000 and BSD Circular No. 10 dated July 13, 2004
respectively and Companies Ordinance, 1984.


Unconsolidated Condensed Interim Statement of Cash Flows
Half Year Ended

June 30, June 30,
2012 2011
Rupees in ‘000
CASH FLOW FROM OPERATING ACTIVITIES

Profit before taxation 9,415,126 7,563,767
Less: Dividend income 3,329,282 758,690
6,085,844 6,805,077

Adjustments for non-cash charges:
Depreciation / amortization 548,315 484,724
Provision against non-performing loans, advances and general provision - net 874,030 1,039,519
(Reversal) in provision of diminution in the value of investments - net (592,813) (47,038)
Unrealized loss on revaluation of held for trading securities - net 792 797
Provision / (reversals) against off balance sheet obligations - net 25,894 (24,866)
(Reversal) / provision against other assets - net (6,542) 156,871
Gain on sale of fixed assets (14,298) (900)
835,378 1,609,107
6,921,222 8,414,184
Decrease / (increase) in operating assets
Lendings to financial institutions (11,892,681) (24,517,063)
Held for trading securities (1,481,503) (1,161,372)
Advances (17,151,850) 10,323,438
Other assets (excluding advance taxation) - net (757,904) 87,346
(31,283,938) (15,267,651)
Increase / (decrease) in operating liabilities
Bills payable (20,718) (690,052)
Borrowings from financial institutions (17,567,732) 117,462
Deposits and other accounts 55,030,179 35,016,686
Other liabilities (123,522) (850,681)
37,318,207 33,593,415
12,955,491 26,739,948
Income tax paid (4,740,108) (2,946,275)
Net cash flows from operating activities 8,215,383 23,793,673

CASH FLOWS FROM INVESTING ACTIVITIES
Net investments in available for sale securities (1,566,097) (20,648,049)
Proceed from disposal of held to maturity securities 913,850 340,026
Dividend income received 3,654,301 583,812
Investments in operating fixed assets (1,770,489) (1,216,283)
Proceeds from sale of fixed assets 15,512 7,448
Net cash flows from / (used in) investing activities 1,247,077 (20,933,046)
CASH FLOWS FROM FINANCING ACTIVITIES
Payment of sub-ordinated loans (1,100) (1,100)
Dividends paid (4,022,109) (1,545,353)
Net cash used in financing activities (4,023,209) (1,546,453)
Increase in cash and cash equivalents during the period 5,439,251 1,314,174
Cash and cash equivalents at beginning of the period 38,124,951 31,750,995

CASH AND CASH EQUIVALENTS AT END OF THE PERIOD 43,564,202 33,065,169
11
Unconsolidated Condensed Interim Statement of Changes in Equity
Share Share Statutory Bonus Issue Special Merger General Un–appropriated

Capital Premium Reserve Reserve Reserve* Reserve* Reserve Profit Total
Rupees in ‘000

Balance as at January 01, 2011 7,821,009 983,957 6,125,094 - 67,995 333,864 6,000 15,828,533 31,166,452
Changes in equity during the half year ended June 30, 2011
Total comprehensive income for the half year ended June 30, 2011 - - - - - - - 5,032,888 5,032,888
Transactions with owners recognised directly in equity
Transfer to reserve for issue of bonus shares for the year
ended December 31, 2010 @ 10% - (782,101) - 782,101 - - - - -
Issue of bonus shares 782,101 - - (782,101) - - - - -
Final cash dividend for the year ended December 31, 2010
(Rs. 2.00 per ordinary share) - - - - - - - (1,564,202) (1,564,202)
782,101 (782,101) - - - - - (1,564,202) (1,564,202)
Transferred from surplus on revaluation of fixed
assets to un-appropriated profit - net of tax - - - - - - - 14,602 14,602
Transfer to statutory reserve - - 1,006,578 - - - - (1,006,578) -
Balance as at June 30, 2011 8,603,110 201,856 7,131,672 - 67,995 333,864 6,000 18,305,243 34,649,740
Changes in equity during the half year ended December 31, 2011
Total comprehensive income for the six months

ended December 31, 2011 - - - - - - - 5,106,793 5,106,793
Transactions with owners recognized directly in equity
Interim cash dividend for the year ended December 31, 2011
Transferred from surplus on revaluation of fixed assets
to un-appropriated profit - net of tax - - - - - - - 14,602 14,602
Balance as at December 31, 2011 8,603,110 201,856 8,153,030 - 67,995 333,864 6,000 20,254,503 37,620,358
Transfer to reserve for issue of bonus shares for the
year ended December 31, 2011 @ 10% - (201,856) - 860,311 - - - (658,455) -
Interim cash dividend for the year ending December 31, 2012
860,311 (201,856) - - - - - (4,701,916) (4,043,461)
Balance as at June 30, 2012 9,463,421 - 9,483,592 - 67,995 333,864 6,000 20,890,347 40,245,219
* These were created as a result of merger of Ibrahim Leasing Limited and First Allied Bank Modaraba into Allied Bank Limited.


Notes to the Unconsolidated Condensed Interim Financial Statements
1. STATUS AND NATURE OF BUSINESS

Allied Bank Limited (“the Bank”), incorporated in Pakistan, is a scheduled Bank, engaged in commercial
banking and related services. The Bank is listed on all stock exchanges in Pakistan. The Bank operates
a total of 838 (2011: 837) branches in Pakistan including the Karachi Export Processing Zone Branch
(overseas business unit). The long term credit rating of the Bank assigned by The Pakistan Credit Rating
Agency Limited (PACRA) is ‘AA+’. Short term rating of the Bank is ‘A1+’. The Bank is the holding company
of ABL Asset Management Company Limited.

The registered office of the Bank is situated at “3-4 Tipu Block, Main Boulevard, New Garden Town,
Lahore”.

2. STATEMENT OF COMPLIANCE

2.1 These unconsolidated condensed interim financial statements of the Bank for the half year ended June
30, 2012 have been prepared in accordance with the requirements of the International Accounting
Standard 34 - Interim Financial Reporting, provisions of the Companies Ordinance, 1984, the Banking
Companies Ordinance, 1962 and the directives issued by the State Bank of Pakistan. In case where
requirements of provisions and directives issued under the Banking Companies Ordinance, 1962,
Companies Ordinance 1984 and the directives issued by State Bank of Pakistan differs, the directives
issued by SBP shall prevail.

2.2 The SBP, vide BSD Circular No. 10, dated August 26, 2002 has deferred the applicability of International
Accounting Standard 39, Financial Instruments: Recognition and Measurement (IAS 39) and International
Accounting Standard 40, Investment Property (IAS 40) for banking companies till further instructions.
Further, according to a notification of Securities and Exchange Commission of Pakistan (SECP) dated
April 28, 2008, International Financial Reporting Standard (IFRS) 7 “Financial Instruments: Disclosures”
has not been made applicable for banks. Accordingly, the requirements of these standards have not
been considered in the preparation of these unconsolidated condensed interim financial statements.
However, investments have been classified and disclosed in accordance with the requirements
prescribed by SBP through various circulars.

2.3 These unconsolidated condensed interim financial statements represent the separate standalone
condensed interim financial statements of the bank. The consolidated condensed interim financial
statements of the banks and its subsidiary company are presented separately.

2.4 These unconsolidated condensed interim financial statements are being submitted to the shareholders
in accordance with section 245 of the Companies Ordinance, 1984.

3. BASIS OF MEASUREMENT

These unconsolidated condensed interim financial statements have been prepared under the historical
cost convention except that certain fixed assets are stated at revalued amounts and certain investments,
commitments in respect of forward exchange contracts and derivative financial instruments have been
marked to market and are carried at fair value.

4. BASIS OF PRESENTATION

The disclosures included in these unconsolidated condensed interim financial statements are limited
based on the format prescribed by the State Bank of Pakistan, vide BSD Circular Letter No. 2 dated May
12, 2004, vide BSD Circular Letter No. 7 dated April 20, 2010 and International Accounting Standard
34, Interim Financial Reporting. They do not include all of the information required for complete annual
financial statements, and these unconsolidated condensed interim financial statements should be read
in conjunction with the unconsolidated financial statements of the Bank for the year ended December

31, 2011.

13
5. Summary of significant accounting policies, estimates and risk management policies

5.1 The accounting policies, underlying estimates and methods of computation followed in the
preparation of these unconsolidated condensed interim financial statements are same as those
applied in preparing the most recent annual unconsolidated financial statements of the Bank.
Other than those disclosed in Note 5.3 below.

5.2 The financial risk management objectives and policies adopted by the Bank are consistent with
that disclosed in the financial statements of the Bank for the year ended December 31, 2011.

5.3 During the period, following amendment to accounting standards became effective.

- IAS 12 – Income Taxes (Amendment) - Recovery of Underlying Assets

Adoption of the above amendment did not have any material effect on the condensed interim
financial statements.
Un-audited Audited
2012 2011
Rupees in ‘000
6. LENDINGS TO FINANCIAL INSTITUTIONS
Repurchase agreement lendings (Reverse Repo) 6.1 13,254,435 1,361,754

Certificates of investment 6.2 70,000 70,000

13,324,435 1,431,754
Provision against lendings to financial institutions (70,000) (70,000)
13,254,435 1,361,754

6.1 These are short-term lendings to various financial institutions against the government securities. These
carry mark-up at rate, ranging between 11.45% and 11.95% (2011: 11.90 %) per annum and will mature on
various dates latest by July 18, 2012.

6.2 This represents non performing certificates of investment.

Held by Given as Total

Note Bank Collateral
Rupees in ‘000
7. Investments
As on June 30, 2012 (Un-audited) 7.1 186,840,894 12,301,184 199,142,078
Prior year - December 31, 2011 (Audited) 7.1 165,806,713 29,887,409 195,694,122
Un–audited Audited
As at June 30, 2012 As at December 31, 2011
Note Held by Given as Total Held by Given as Total

Bank collateral Bank collateral
Rupees in ‘000
7.1 Investments by types:
Held for trading securities
Market Treasury Bills 1,481,503 - 1,481,503 - - -
1,481,503 - 1,481,503 - - -
Available for sale securities
Market Treasury Bills 78,290,497 12,342,924 90,633,421 92,151,063 29,859,590 122,010,653
Pakistan Investment Bonds 147,543 - 147,543 147,290 - 147,290
Ordinary shares of listed companies /
certificates of mutual funds 13,004,503 - 13,004,503 10,727,056 - 10,727,056
Preference shares 149,355 - 149,355 149,355 - 149,355
Units of open end mutual funds 9,970,504 - 9,970,504 5,210,776 - 5,210,776
Ordinary shares of unlisted companies 1,632,306 - 1,632,306 1,643,673 - 1,643,673
Investment in related parties
- Unlisted shares 242,496 - 242,496 242,496 - 242,496
- Units of open end mutual funds 40,045,133 - 40,045,133 13,690,232 - 13,690,232
Sukuk Bonds 3,409,034 - 3,409,034 3,598,872 - 3,598,872
Term Finance Certificates (TFCs) 2,897,214 - 2,897,214 3,250,449 - 3,250,449
149,788,585 12,342,924 162,131,509 130,811,262 29,859,590 160,670,852

Held to maturity securities
Pakistan Investment Bonds 27,176,942 - 27,176,942 27,574,628 - 27,574,628
Foreign Currency Bonds (US$) 2,090,880 - 2,090,880 1,591,392 - 1,591,392
TFCs, Debentures, Bonds and PTCs 4,751,210 - 4,751,210 5,766,862 - 5,766,862
34,019,032 - 34,019,032 34,932,882 - 34,932,882
Subsidiary
ABL Asset Management Company Limited 500,000 - 500,000 500,000 - 500,000
Investments at cost
185,789,120 12,342,924 198,132,044 166,244,144 29,859,590 196,103,734

Provision for diminution in the
value of investments 7.2 (2,005,508) - (2,005,508) (2,703,761) - (2,703,761)

Investments (net of provisions) 183,783,612 12,342,924 196,126,536 163,540,383 29,859,590 193,399,973
Unrealized loss on revaluation of
held for trading securities (792) - (792) - - -
Surplus on revaluation of
available for sale securities 3,058,074 (41,740) 3,016,334 2,266,330 27,819 2,294,149
Total investments 186,840,894 12,301,184 199,142,078 165,806,713 29,887,409 195,694,122
15
Un-audited Audited
2012 2011
Rupees in ‘000
7.2 Provision for diminution in the value of investments

Opening balance 2,703,761 2,681,810

Charge for the year 19,332 344,752
Reversals / transfers (612,145) (115,749)
Net charge (592,813) 229,003
Reversal as gain on disposal (105,044) (75,417)
Amounts written off (396) (131,635)

Closing balance 2,005,508 2,703,761
8. ADVANCES

Loans, cash credits, running finances, etc. - in Pakistan 272,395,925 256,549,230

Net investment in finance lease - in Pakistan 1,817,706 1,748,858

Bills discounted and purchased (excluding treasury bills)
Payable in Pakistan 1,857,734 1,769,188
Payable outside Pakistan 2,180,219 2,069,915
4,037,953 3,839,103
Advances - gross 278,251,584 262,137,191

Provision for non-performing advances 8.1 (17,498,372) (17,671,070)
General provision against consumer financing (41,918) (32,647)
(17,540,290) (17,703,717)

Advances - net of provision 260,711,294 244,433,474

8.1 Advances include Rs. 20,984.321 million (2011: Rs. 20,452.465 million) which have been placed under
non-performing status as detailed below:-

June 30, 2012 (Un-audited)
Category of Classification Classified Advances Provision Provision
Domestic Overseas Total required held
Rupees in ‘000
Other assets especially mentioned 29,690 - 29,690 - -

Substandard 1,330,666 - 1,330,666 331,554 331,554
Doubtful 4,834,703 - 4,834,703 2,392,618 2,392,618
Loss 14,789,262 - 14,789,262 14,774,200 14,774,200
20,984,321 - 20,984,321 17,498,372 17,498,372

December 31, 2011 (Audited)

Rupees in ‘000

Other assets especially mentioned 63,380 - 63,380 - -
Substandard 1,780,543 - 1,780,543 444,292 444,292
Doubtful 2,711,866 - 2,711,866 1,331,198 1,331,198
Loss 15,896,676 - 15,896,676 15,895,580 15,895,580
20,452,465 - 20,452,465 17,671,070 17,671,070
8.2 No benefit of Forced Sale Value of the collaterals held by the Bank has been taken while determining the
provision against non performing loans as allowed under BSD circular No. 02 dated June 03, 2010.

8.3 Provision against non-performing loans and advances and general provision
June 30, 2012 (Un-audited) December 31, 2011 (Audited)
Specific General Total Specific General Total

Rupees in ‘000
Opening balance 17,671,070 32,647 17,703,717 15,420,788 9,474 15,430,262
Charge for the period / year 2,098,703 9,271 2,107,974 4,354,209 23,173 4,377,382
Reversals (1,233,944) - (1,233,944) (1,667,361) - (1,667,361)
Charged to profit and
loss account 864,759 9,271 874,030 2,686,848 23,173 2,710,021
Amounts written off (1,037,457) - (1,037,457) (436,566) - (436,566)

Closing balance 17,498,372 41,918 17,540,290 17,671,070 32,647 17,703,717
Un-audited Audited
June 30, December 31,
2012 2011
Rupees in ‘000
9. BORROWINGS WITH FINANCIAL INSTITUTIONS
Details of borrowings (Secured / Unsecured)
Secured
Borrowings from State Bank of Pakistan 17,279,804 18,569,393
Repurchase agreement borrowings 11,940,880 29,474,488
Unsecured
Call borrowings 3,127,134 1,915,427

Other borrowings 43,758 -
Overdrawn nostro accounts - 33,892

3,170,892 1,949,319
32,391,576 49,993,200
17
Un-audited Audited
2012 2011
Rupees in ‘000
10. DEPOSITS AND OTHER ACCOUNTS
Customers
Fixed deposits 114,412,961 110,061,707
Savings deposits 113,929,121 106,783,680
Current accounts - Remunerative 79,888,623 57,667,849
- Non - remunerative 145,270,692 124,121,553
453,501,397 398,634,789
Financial Institutions
Remunerative deposits 699,196 560,816
Non - remunerative deposits 391,262 366,071
454,591,855 399,561,676
11 SHARE CAPITAL

11.1 Authorized capital
Un-audited Audited Un-audited Audited

June 30, December 31, June 30, December 31,
2012 2011 2012 2011
No. of shares Rupees in ‘000

1,500,000,000 1,500,000,000 Ordinary shares of Rs.10/- each 15,000,000 15,000,000

11.2 Issued, subscribed and paid-up capital

Fully paid-up Ordinary shares of Rs. 10/- each

June 30, December 31, Ordinary shares June 30, December 31,
2012 2011 2012 2011

406,780,094 406,780,094 Fully paid in cash 4,067,801 4,067,801
522,013,365 435,982,273 Issued as bonus shares 5,220,134 4,359,823

928,793,459 842,762,367 9,287,935 8,427,624
18,348,550 Ordinary shares of Rs. 10 each,
determined pursuant to the Scheme of

Amalgamation in accordance with the swap
ratio stipulated therein less 9,200,000
Ordinary shares of Rs. 10 each, held by
Ibrahim Leasing Limited on the cut-off date
9,148,550 9,148,550 (September 30, 2004) 91,486 91,486

Amalgamation of First Allied Bank Modaraba
with Allied Bank Limited in accordance with the
8,400,000 8,400,000 share swap ratio stipulated therein 84,000 84,000
946,342,009 860,310,917 9,463,421 8,603,110

Ibrahim Fibers Limited, related party of the Bank, holds 226,365,220 (23.92%) [December 31, 2011: 270,786,564
(31.4%)] ordinary shares of Rs.10 each, as at reporting date.

Un-audited Audited
2012 2011
Rupees in ‘000
12. CONTINGENCIES AND COMMITMENTS

12.1 Direct credit substitutes
Guarantees in favour of:
Banks and financial institutions 606,923 611,478

12.2 Transaction-related contingent liabilities
Government 23,287,869 14,010,962
Others 12,276,973 21,208,164
35,564,842 35,219,126

12.3 Trade-related contingent liabilities 52,158,187 52,324,035

12.4 Claims against the Bank not acknowledged as debt 3,981,909 4,210,600

12.5 Commitment to extend credit
The Bank makes commitments to extend credit in the normal course of its business but these being
revocable commitments do not attract any significant penalty or expense if the facility is unilaterally
withdrawn.
Un-audited Audited
2012 2011
Rupees in ‘000
12.6 Commitments in respect of forward foreign exchange contracts
Purchase 41,919,913 49,580,813
Sale 28,021,375 25,543,453

12.7 Commitments in respect of operating fixed assets
Civil works 1,034,741 1,496,831
Acquisition of operating fixed assets 520,588 504,141
1,555,329 2,000,972

12.8 Commitments in respect of lease financing 131,082 110,472
12.9 Commitments in respect of Market Treasury Bills - 3,926,578
12.10 Contingencies
12.10.1 There is no change in the status of contingencies, set out in note 22.11 to the unconsolidated financial
statements of the Bank for the year ended December 31, 2011, except for the contingency as mentioned
below:
12.10.2 The income tax assessments of the Bank have been finalized upto and including tax year 2011 for local
and Azad Kashmir operations. While finalizing income tax assessments upto tax year 2011, income tax
authorities made certain add backs with aggregate tax impact of Rs.12,301 million (2011: 10,718 million).
As a result of appeals filed by the Bank before appellate authorities, the add backs with tax impact
amounting to Rs.2,524 million (2011: 2,524 million) and Rs.9,229 million (2011: 9,229 million) were set-
aside and deleted respectively. While giving appeal effects on most of the deleted issues, a refund of
Rs.5,940 million (2011: 5,940 million) has been determined. Against most of the deleted and set-aside
issues, Department is in appeal before higher appellate authorities. Pending finalization of appeals no
provision has been made by the Bank on aggregate sum of Rs.12,301 million (2011: 10,718 million). The
management is hopeful that the outcome of these appeals will be in favor of the Bank.
19
Half Year ended Quarter ended

2012 2011 2012 2011
Rupees in ‘000
13. MARK-UP / RETURN / INTEREST EARNED
On loans and advances 16,080,003 16,550,130 8,358,508 8,089,727

On investments in:
Available for sale securities 5,625,160 6,440,747 2,581,580 3,393,323
Held to maturity securities 2,003,626 363,293 983,294 174,357
Held for trading securities 27,171 1,450 25,230 1,450
7,655,957 6,805,490 3,590,104 3,569,130
On deposits with financial institutions 1,657 923 25 726

On securities purchased under resale agreements 619,256 1,171,415 426,174 587,411
On certificates of investment - 5,682 - 3,542
On letters of placement 2,499 3,616 241 3,616
On call money lending 19,120 35,602 11,362 26,036
24,378,492 24,572,858 12,386,414 12,280,188

14. MARK-UP / RETURN / INTEREST EXPENSED
Deposits 10,639,122 10,014,682 5,709,895 4,965,117
Long term borrowing 122,634 155,775 59,141 76,858
Securities sold under repurchase agreements 1,271,754 90,938 346,227 61,062
Call money borrowing 238,613 69,910 119,212 39,689
Brokerage and commission 73,126 52,197 40,559 21,156
Markup on sub-ordinated loans 369,494 402,323 181,891 203,261
Other short term borrowings 1,704,305 1,410,675 852,089 735,494
14,419,048 12,196,500 7,309,014 6,102,637

15. EARNINGS PER SHARE - BASIC AND DILUTED
Profit after taxation for the period attributable

to ordinary shareholders 6,652,808 5,032,888 3,608,476 2,521,915
Number of Shares
Weighted average number of ordinary shares
outstanding during the period Restated Restated
15.1 946,342,009 946,342,009 946,342,009 946,342,009
Rupees
Restated Restated
Earnings per share - basic and diluted for the period 15.1 7.03 5.32 3.81 2.66

There is no dilution effect on basic earnings per share.

15.1 The corresponding figures of weighted average number of shares outstanding and earnings per share
have been restated to include the effect of bonus shares issued by the Bank during the period.

16 RELATED PARTY TRANSACTIONS

The Bank has related party relationships with its subsidiary, companies with common directorship, directors, employee benefit plans and key management personnel.

Contributions to the accounts in respect of staff retirement benefits are made in accordance with actuarial valuation / terms of the contribution plan. Remuneration of the key management personnel are in accordance with the terms of their
employment. Other transactions are at agreed terms.
June 30, 2012 (Un-audited) December 31, 2011 (Audited)
Directors Associated Subsidiary Key Other related Directors Associated Subsidiary Key Other related
Companies management parties Companies management parties
personnel personnel
Rupees in ‘000
Nature of related party transactions
Loans
Loans at the beginning of the period / year 49,969 - - 203,005 - 61,581 - - 200,035 16,061,896
Loans given during the period / year 8,952 - - 56,021 - 23,757 - - 37,765 464,087
Loans repaid / adjustment during the period / year (13,156) - - (52,421) - (35,369) - - (34,795) (16,525,983)
Loans at the end of the period / year 45,765 - - 206,605 - 49,969 - - 203,005 -

Deposits
Deposits at the beginning of the period / year 17,270 48,985 5,710 13,556 230,430 9,821 93,965 3,241 16,128 3,042,357
Deposits received during the period / year 3,943,977 8,084,863 777,612 175,237 56,740,725 4,147,530 13,513,467 697,925 191,103 14,937,123
Deposits repaid during the period / year (3,947,519) (8,123,948) (777,163) (161,900) (56,256,382) (4,140,081) (13,558,447) (695,456) (193,675) (17,749,050)
Deposits at the end of the period / year 13,728 9,900 6,159 26,893 714,773 17,270 48,985 5,710 13,556 230,430

Nostro balances - 212,984 - - - - 131,749 - - -
Borrowings - 127,134 - - - - 1,204,313 - - -
Investments in shares / open end mutual funds - 239,919 500,000 - 39,970,101 - 240,969 500,000 - 13,623,621
Other receivables - - 9,778 - - - - 3,656 - -
Net receivable from staff retirement benefit funds - - - - 1,551,080 - - - - 1,430,976
June 30, 2012 (Un-audited) June 30, 2011 (Un-audited)

Directors Associated Subsidiary Key Other related Directors Associated Subsidiary Key Other related
Companies management parties Companies management parties
personnel personnel
Rupees in ‘000
Mark-up earned 878 - - 6,144 - 1,294 - - 6,685 161,033
Income on placements - 26 - - - - 4 - - -
Income on lendings - - - - - - 111 - - -
Dividend income - - - - 2,096,020 - - - - 184,712
Sales Commission / management fee sharing - - 45,623 - - - - 8,078 - 10,540
Mark-up expense on deposits 392 - 597 15 29,714 248 3 193 35 128,531
Interest expense on borrowings - 48,113 - - - - 29,316 - - -
Directors’ meeting fee 3,250 - - - - 1,725 - - - -
Remuneration - - - 200,693 - - - - 134,013 -
NIFT charges - - - - 47,946 - - - - 42,786

Bank charges levied - - 13 - 169 - - 5 - -
Rent Expense - 2,934 - - - - 2,928 - - -
Charge / (reversal) in respect of staff
retirement benefit funds - - - - 98,379 - - - - 103,355
21
17. SEGMENT DETAILS WITH RESPECT TO BUSINESS ACTIVITIES

The segment analysis with respect to business activity is as follows:-
For the Period Ended June 30, 2012 (Un-audited)
Corporate Trading & Retail Commercial Payment & Eliminations Total
Finance Sales Banking Banking Settlement
Rupees in ‘000

Total Income 337,167 1,527,281 19,827,741 26,148,818 327,556 (16,928,154) 31,240,409
Total Expenses (155,094) (2,004,763) (15,137,939) (24,058,930) (159,029) 16,928,154 (24,587,601)
Net Income 182,073 (477,482) 4,689,802 2,089,888 168,527 - 6,652,808

Corporate Trading & Retail Commercial Payment & Eliminations Total
Rupees in ‘000

Total Income 313,841 1,398,205 14,167,665 22,265,825 336,237 (10,900,671) 27,851,102
Total Expenses (158,796) (1,166,489) (12,105,428) (19,830,103) (188,069) 10,900,671 (22,548,214)
Net Income 155,045 231,716 2,062,237 2,435,722 148,168 - 5,032,888
As at June 30, 2012 (Un-audited)

Corporate Trading & Retail Commercial Payment & Total
Rupees in ‘000

Segment Assets Gross 375,192 13,914,949 106,211,940 456,161,973 331,882 576,995,936
As at December 31, 2011 (Audited)

Corporate Trading & Retail Commercial Payment & Total
Rupees in ‘000
Segment Assets Gross 218,401 559,815 109,238,971 426,931,605 326,217 537,275,009
18. GENERAL
18.1 Figures have been rounded off to the nearest thousand rupees.
18.2 Corresponding figures have been re-arranged and reclassified to reflect more appropriate presentation
of transactions for the purpose of comparison. However, no significant reclassifications have been made
in these unconsolidated condensed interim financial statements.
18.3 The Board of Directors of the Bank in its meeting held on August 16, 2012 has approved second interim
cash dividend for the year ending December 31, 2012 at Rs. 1.5 per share (June 30, 2011: Cash dividend of
Rs. 2.5 per share). The unconsolidated condensed interim financial statements for the half year ended
June 30, 2012 do not include the effect of this appropriation and will be accounted for in the financial
statements of the period of declaration.
19. DATE OF AUTHORIZATION FOR ISSUE
These unconsolidated condensed interim financial statements were authorized for issue on 16 August,
2012 by the Board of Directors of the Bank.

Consolidated Condensed Interim Financial Statements
for the half year ended June 30, 2012
23
Consolidated Condensed Interim Statement of Financial Position
as at June 30, 2012
Un-audited Audited
2012 2011
Rupees in ‘000
ASSETS
Cash and balances with treasury banks 41,890,558 36,479,765
Balances with other banks 1,673,753 1,679,121
Lendings to financial institutions 6 13,254,435 1,361,754
Investments 7 199,313,701 195,789,638
Advances 8 260,732,904 244,439,837
Operating fixed assets 19,318,519 18,095,123
Deferred tax assets 813,505 750,972
Other assets 19,557,820 17,292,402
556,555,195 515,888,612

LIABILITIES
Bills payable 3,994,599 4,015,317
Borrowings from financial institutions 9 32,391,576 49,993,200
Deposits and other accounts 10 454,590,515 399,560,790
Sub-ordinated loans 5,491,500 5,492,600
Liabilities against assets subject to finance lease - -
Deferred tax liabilities - -
Other liabilities 13,249,016 13,347,347
509,717,206 472,409,254
NET ASSETS
46,837,989 43,479,358

REPRESENTED BY
Share capital 11 9,463,421 8,603,110
Reserves
9,891,451 8,762,745
Unappropriated profit 21,119,434 20,395,717
40,474,306 37,761,572
Surplus on revaluation of assets - net of tax 6,363,683 5,717,786
46,837,989 43,479,358
CONTINGENCIES AND COMMITMENTS 12

The annexed notes 1 to 19 form an integral part of these consolidated condensed interim financial
statements.
25
Consolidated Condensed Interim Profit and Loss Account

2012 2011 2012 2011
Rupees in ‘000
Mark-up / return / interest earned 13 24,384,196 24,580,069 12,388,525 12,283,856

Mark-up / return / interest expensed 14 14,372,877 12,188,836 7,243,765 6,083,200
Net mark-up / interest income 10,011,319 12,391,233 5,144,760 6,200,656

Provision against non-performing loans and
advances and general provision - net 874,030 1,039,519 303,434 649,909
(Reversal) / provision for diminution in
the value of investments - net (592,813) (47,038) 17,629 30,921
Bad debts written off directly - - - -
281,217 992,481 321,063 680,830
Net mark-up / interest income after provisions 9,730,102 11,398,752 4,823,697 5,519,826

NON MARK-UP / INTEREST INCOME

Fee, commission and brokerage income 1,570,942 1,590,757 760,411 792,852
Dividend income 3,329,282 758,690 1,612,046 431,873
Income from dealing in foreign currencies 293,820 370,514 156,149 270,504
Gain on sale of securities 1,740,595 372,915 1,495,229 103,005
Unrealized gain on revaluation of investments
classified as held for trading - net 27,470 20,009 8,651 8,852
Other income 121,763 22,594 51,470 12,995
Total non-markup / interest income 7,083,872 3,135,479 4,083,956 1,620,081
16,813,974 14,534,231 8,907,653 7,139,907

NON MARK-UP / INTEREST EXPENSES

Administrative expenses 7,009,208 6,465,057 3,627,606 3,143,697
(Reversal) / provision against other assets - net (6,542) 156,871 82,000 144,871
Provision / (reversal) against off-balance
sheet obligations - net 25,894 (24,866) (30,758) (1,750)
Other charges 253,180 324,654 123,214 116,535

Total non-markup / interest expenses 7,281,740 6,921,716 3,802,062 3,403,353
Extra-ordinary / unusual items - - - -

PROFIT BEFORE TAXATION 9,532,234 7,612,515 5,105,591 3,736,554

Taxation
Current 2,916,412 2,817,936 1,470,001 1,384,968
Prior years - - - -
Deferred (124,859) (277,549) (15,008) (189,366)
2,791,553 2,540,387 1,454,993 1,195,602
PROFIT AFTER TAXATION 6,740,681 5,072,128 3,650,598 2,540,952

Restated Restated
Earnings per share - Basic and Diluted (in Rupees) 15 7.12 5.36 3.86 2.69
The annexed notes 1 to 19 form an integral part of these consolidated condensed interim financial statements.

Consolidated Condensed Interim Statement of Comprehensive Income

June 30, June 30, June 30, June 30,
2012 2011 2012 2011
Rupees in ‘000
Profit after taxation for the period 6,740,681 5,072,128 3,650,598 2,540,952

Other comprehensive income - - - -

Total comprehensive income for the period 6,740,681 5,072,128 3,650,598 2,540,952

Surplus / (deficit) on revaluation of ‘Available for sale’ securities and ‘Fixed assets’ are presented under a separate
head below equity as ‘surplus / (deficit) on revaluation of assets’ in accordance with the requirements specified by the
State Bank of Pakistan vide its BSD Circular No. 20 dated 04 August, 2000 and BSD Circular No. 10 dated 13 July, 2004
respectively and Companies Ordinance, 1984.

27
Consolidated Condensed Interim Statement of Cash Flows
Half Year Ended

June 30, June 30,
2012 2011
Rupees in ‘000
CASH FLOWS FROM OPERATING ACTIVITIES
Profit before taxation 9,532,234 7,612,515
Less: Dividend income 3,329,282 758,690
6,202,952 6,853,825

Adjustments for non-cash charges:
Depreciation / amortization 550,026 487,268
Provision against non-performing loans, advances and
general provision - net 874,030 1,039,519
(Reversal) in provision of diminution in the value of investments - net (592,813) (47,038)
Unrealized loss on revaluation of held for trading securities - net (27,470) (20,009)
Provision / (reversals) against off balance sheet obligations - net 25,894 (24,866)
(Reversal)/provision against other assets - net (6,542) 156,871
Gain on sale of fixed assets (14,298) (898)
808,827 1,590,847
7,011,779 8,444,672
Increase / (decrease) in operating assets
Lendings to financial institutions (11,892,681) (24,517,063)
Held for trading securities (1,657,882) (1,178,199)
Advances (17,167,094) 10,323,947
Other assets (excluding advance taxation) - net (726,088) 82,014
(31,443,745) (15,289,301)
Increase / (decrease) in operating liabilities
Bills payable (20,718) (690,052)
Borrowings from financial institutions (17,567,732) 117,462
Deposits and other accounts 55,029,725 35,018,526
Other liabilities (145,595) (853,188)
37,295,680 33,592,748
12,863,714 26,748,119
Income tax paid (4,774,219) (2,972,939)
Net cash flows from operating activities 8,089,495 23,775,180

CASH FLOWS FROM INVESTING ACTIVITIES
Net investments in ‘available-for-sale’ securities (1,436,099) (20,648,046)
Proceed from disposal of ‘held-to-maturity’ securities 913,850 340,026
Dividend income received 3,654,301 583,812
Investments in operating fixed assets (1,774,809) (1,217,438)
Proceeds from sale of fixed assets 15,788 7,447
Net cash flows from / (used in) investing activities 1,373,031 (20,934,199)

CASH FLOWS FROM FINANCING ACTIVITIES
Payment of sub-ordinated loans (1,100) (1,100)
Dividends paid (4,022,109) (1,545,353)
Net cash used in financing activities (4,023,209) (1,546,453)
Increase in cash and cash equivalents during the period 5,439,317 1,294,528
Cash and cash equivalents at beginning of the period 38,124,994 31,751,190

CASH AND CASH EQUIVALENTS AT END OF THE PERIOD 43,564,311 33,045,718


Consolidated Condensed Interim Statement of Changes in Equity
Share Share Statutory Bonus Issue Special Merger General Un–appropriated

Capital Premium Reserve Reserve Reserve* Reserve* Reserve Profit Total
Rupees in ‘000

Balance as at 1 January, 2011 7,821,009 983,957 6,125,094 - 67,995 333,864 6,000 15,853,255 31,191,174
Transactions with owners recognised directly in equity
Transfer to reserve for issue of bonus shares for the year

ended December 31, 2010 @ 10% - (782,101) - 782,101 - - - - -
782,101 (782,101) - - - - - (1,564,202) (1,564,202)

Transferred from surplus on revaluation of fixed
assets to un-appropriated profit - net of tax - - - - - - - 14,602 14,602
Balance as at June 30, 2011 8,603,110 201,856 7,131,672 - 67,995 333,864 6,000 18,369,205 34,713,702
Changes in equity during the half year ended December 31, 2011
Total comprehensive income for the six months ended December 31, 2011 - - - - - - - 5,184,045 5,184,045
Interim cash dividend for the year ended December 31, 2011
Balance as at December 31, 2011 8,603,110 201,856 8,153,030 - 67,995 333,864 6,000 20,395,717 37,761,572
Transfer to reserve for issue of bonus shares for the year ended
December 31, 2011 @ 10% - (201,856) - 860,311 - - - (658,455) -
Interim cash dividend for the year ending December 31, 2012
860,311 (201,856) - - - - - (4,701,916) (4,043,461)

Balance as at June 30, 2012 9,463,421 - 9,483,592 - 67,995 333,864 6,000 21,119,434 40,474,306
* These were created as a result of merger of Ibrahim Leasing Limited and First Allied Bank Modaraba into Allied Bank Limited.

29
Notes to the Consolidated Condensed Interim Financial Statements
1. STATUS AND NATURE OF BUSINESS

The Group consists of:

Allied Bank Limited (“the Bank”), incorporated in Pakistan, is a scheduled Bank, engaged in commercial
banking and related services. The Bank is listed on all stock exchanges in Pakistan. The Bank operates
a total of 838 (2011: 837) branches in Pakistan including the Karachi Export Processing Zone Branch
(overseas business unit). The long term credit rating of the Bank assigned by The Pakistan Credit Rating
Agency Limited (PACRA) is ‘AA+’. Short term rating of the Bank is ‘A1+’. The Bank is the holding company
of ABL Asset Management Company Limited.

The registered office of the Bank is situated at “3-4 Tipu Block, Main Boulevard, New Garden Town,
Lahore”.

Subsidiary Company

ABL Asset Management Company Limited, a wholly owned subsidiary of the Bank, is a public unlisted
company incorporated in Pakistan as a limited liability company on October 12, 2007 under the
Companies Ordinance, 1984. The subsidiary company has obtained licenses from the Securities and
Exchange Commission of Pakistan (SECP) to carry out Asset Management Services and Investment
Advisory Services as a Non-Banking Finance Company (NBFC) under Non-Banking Finance Companies
(Establishment and Regulation) Rules, 2003 as amended through S.R.O.1131[I] 2007 (the NBFC Rules,
2003). The subsidiary company received certificate of commencement of business on December 31,
2007. The registered office of the subsidiary company is situated at 11-B Lalazar, M.T. Khan Road,
Karachi. The Management quality rating of the company, as assigned by JCR-VIS credit rating company
limited, is AM2-.

ABL Asset Management company is managing following open ended funds:

- ABL-Income Fund Launched on September 20, 2008
- ABL-Stock Fund Launched on June 28, 2009
- ABL-Cash Fund Launched on July 31, 2010
- ABL-Islamic Income Fund Launched on July 31, 2010
- ABL-Government securities Fund Launched on November 30, 2011
- ABL-Capital Protected Fund Launched on June 01, 2012

2. STATEMENT OF COMPLIANCE

2.1 These consolidated condensed interim financial statements of the Bank for the half year ended June 30,
2012 have been prepared in accordance with the requirements of the International Accounting Standard
34 - Interim Financial Reporting, provisions of the Companies Ordinance, 1984, the Banking Companies
Ordinance, 1962 and the directives issued by the State Bank of Pakistan. In case where requirements of
provisions and directives issued under the Banking Companies Ordinance, 1962, Companies Ordinance
1984 and the directives issued by State Bank of Pakistan differs, the directives issued by SBP shall
prevail.

2.2 The SBP, vide BSD Circular No. 10, dated August 26, 2002 has deferred the applicability of
International Accounting Standard 39, Financial Instruments: Recognition and Measurement (IAS
39) and International Accounting Standard 40, Investment Property (IAS 40) for banking companies
till further instructions. Further, according to a notification of Securities and Exchange Commission of
Pakistan (SECP) dated April 28, 2008, International Financial Reporting Standard (IFRS) 7 “Financial
Instruments: Disclosures” has not been made applicable for banks. Accordingly, the requirements of
these standards have not been considered in the preparation of these consolidated condensed interim
financial statements. However, investments have been classified and disclosed in accordance with the
requirements prescribed by SBP through various circulars.

2.3 These consolidated condensed interim financial statements are being submitted to the shareholders in
accordance with section 245 of the Companies Ordinance, 1984.

3. BASIS OF MEASUREMENT

These consolidated condensed interim financial statements have been prepared under the historical
cost convention except that certain fixed assets are stated at revalued amounts and certain investments,
commitments in respect of forward exchange contracts and derivative financial instruments have been
marked to market and are carried at fair value.

4. BASIS OF PRESENTATION

The disclosures included in these consolidated condensed interim financial statements are limited
based on the format prescribed by the State Bank of Pakistan, vide BSD Circular Letter No. 2 dated May
12, 2004, vide BSD Circular Letter No. 7 dated April 20, 2010 and International Accounting Standard
34, Interim Financial Reporting. They do not include all of the information required for complete annual
financial statements, and these consolidated condensed interim financial statements should be read
in conjunction with the consolidated financial statements of the Bank for the year ended December 31,
2011.
5. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, ESTIMATES AND RISK MANAGEMENT POLICIES

5.1 The accounting policies, underlying estimates and methods of computation followed in the preparation
of these consolidated condensed interim financial statements are same as those applied in preparing
the most recent annual consolidated financial statements of the Bank. Other than those disclosed in
Note 5.3 below.

5.2 The financial risk management objectives and policies adopted by the Bank are consistent with that
disclosed in the financial statements of the Bank for the year ended December 31, 2011.

5.3 During the period, following amendment to accounting standards became effective.
- IAS 12 – Income Taxes (Amendment) - Recovery of Underlying Assets

Adoption of the above amendment did not have any material effect on the interim financial statements.
Un-audited Audited
2012 2011
Rupees in ‘000
6. LENDINGS TO FINANCIAL INSTITUTIONS
Repurchase agreement lendings (Reverse Repo) 6.1 13,254,435 1,361,754

Certificates of investment 6.2 70,000 70,000

13,324,435 1,431,754
Provision against lendings to financial institutions (70,000) (70,000)
13,254,435 1,361,754
6.1 These are short-term lendings to various financial institutions against the government securities. These
carry mark-up at rate, ranging between 11.45% and 11.95% (2011: 11.90 %) per annum and will mature on
various dates latest by 18 July, 2012.
6.2 This represents non performing certificates of investment.
31
Held by Given as Total

Note Bank Collateral
Rupees in ‘000
7. Investments
As on June 30, 2012 (Un-audited) 7.1 187,012,517 12,301,184 199,313,701
Prior year - December 31, 2011 (Audited) 7.1 165,902,229 29,887,409 195,789,638
Un-audited Audited
As at June 30, 2012 As at December 31, 2011
Held by Given as Total Held by Given as Total
Group collateral Group collateral
Rupees in ‘000
7.1 Investments by types:
Held for trading securities
Units of open end mutual funds- Related party 613,812 - 613,812 446,148 - 446,148
Term Finance Certificates 14,745 - 14,745 - - -
Market Treasury Bills 1,481,503 - 1,481,503 - - -
2,110,060 - 2,110,060 446,148 - 446,148

Available for sale securities
Market Treasury Bills 78,290,497 12,342,924 90,633,421 92,151,063 29,859,590 122,010,653
Pakistan Investment Bonds 147,543 - 147,543 147,290 - 147,290
Ordinary shares of listed companies /
certificates of mutual funds 13,004,503 - 13,004,503 10,727,056 - 10,727,056
Preference shares 149,355 - 149,355 149,355 - 149,355
Units of open end mutual funds 9,970,504 - 9,970,504 5,210,776 - 5,210,776
Ordinary shares of unlisted companies 1,632,306 - 1,632,306 1,643,673 - 1,643,673
Investment in related parties
- Unlisted shares 242,496 - 242,496 242,496 - 242,496
- Units of open end mutual funds 40,045,133 - 40,045,133 13,690,232 - 13,690,232
Sukuk Bonds 3,409,034 - 3,409,034 3,598,872 - 3,598,872
Term Finance Certificates (TFCs) 2,912,214 - 2,912,214 3,395,447 - 3,395,447
149,803,585 12,342,924 162,146,509 130,956,260 29,859,590 160,815,850

Held to maturity securities
Pakistan Investment Bonds 27,176,942 - 27,176,942 27,574,628 - 27,574,628
Foreign Currency Bonds (US$) 2,090,880 - 2,090,880 1,591,392 - 1,591,392
TFCs, Debentures, Bonds and PTCs 4,751,210 - 4,751,210 5,766,862 - 5,766,862
34,019,032 - 34,019,032 34,932,882 - 34,932,882
Investments at cost 185,932,677 12,342,924 198,275,601 166,335,290 29,859,590 196,194,880

Provision for diminution in the
value of investments 7.2 (2,005,508) - (2,005,508) (2,703,761) - (2,703,761)
Investments (net of provisions) 183,927,169 12,342,924 196,270,093 163,631,529 29,859,590 193,491,119
Unrealized loss on revaluation of

held for trading securities 27,470 - 27,470 6,030 - 6,030
Surplus on revaluation of
available for sale securities 3,057,878 (41,740) 3,016,138 2,264,670 27,819 2,292,489
Total investments 187,012,517 12,301,184 199,313,701 165,902,229 29,887,409 195,789,638

Un-audited Audited
2012 2011
Rupees in ‘000
7.2 Provision for diminution in the value of investments
Opening balance 2,703,761 2,681,810
Charge for the year 19,332 344,752
Reversals / transfers (612,145) (115,749)
Net reversals / charge (592,813) 229,003
Reversal as gain on disposal (105,044) (75,417)
Amounts written off (396) (131,635)
Closing balance 2,005,508 2,703,761
8. ADVANCES
Loans, cash credits, running finances, etc. - in Pakistan 272,417,532 256,555,593
Net investment in finance lease - in Pakistan 1,817,706 1,748,858
Bills discounted and purchased (excluding treasury bills)
Payable in Pakistan 1,857,734 1,769,188
Payable outside Pakistan 2,180,219 2,069,915
4,037,953 3,839,103
Advances - gross 278,273,191 262,143,554
Provision for non-performing advances 8.1 (17,498,372) (17,671,070)
General provision against consumer financing (41,915) (32,647)
(17,540,287) (17,703,717)
Advances - net of provisions
260,732,904 244,439,837

8.1 Advances include Rs. 20,984.321 million (2011: Rs. 20,452.465 million) which have been placed under
non-performing status as detailed below:-
June 30, 2012 (Un-audited)
Rupees in ‘000
Other Assets Especially Mentioned 29,690 - 29,690 - -
Substandard 1,330,666 - 1,330,666 331,554 331,554
Doubtful 4,834,703 - 4,834,703 2,392,618 2,392,618
Loss 14,789,262 - 14,789,262 14,774,200 14,774,200
20,984,321 - 20,984,321 17,498,372 17,498,372
December 31, 2011 (Audited)

Rupees in ‘000
Other Assets Especially Mentioned 63,380 - 63,380 - -
Substandard 1,780,543 - 1,780,543 444,292 444,292
Doubtful 2,711,866 - 2,711,866 1,331,198 1,331,198
Loss 15,896,676 - 15,896,676 15,895,580 15,895,580
20,452,465 - 20,452,465 17,671,070 17,671,070
8.2 No benefit of Forced Sale Value of the collaterals held by the Bank has been taken while determining the
provision against non performing loans as allowed under BSD circular No. 02 dated June 03, 2010.
33
8.3 Provision against non-performing loans and advances and general provision
June 30, 2012 (Un-audited) December 31, 2011 (Un-audited)

Specific General Total Specific General Total
Rupees in ‘000
Opening balance 17,671,070 32,647 17,703,717 15,420,788 9,474 15,430,262
Charge for the period / year 2,098,703 9,268 2,107,971 4,354,209 23,173 4,377,382
Reversals (1,233,944) - (1,233,944) (1,667,361) - (1,667,361)
Charged to profit and loss account 864,759 9,268 874,027 2,686,848 23,173 2,710,021
Amounts written off (1,037,457) - (1,037,457) (436,566) - (436,566)
Closing balance 17,498,372 41,915 17,540,287 17,671,070 32,647 17,703,717
Un-audited Audited
2012 2011
Rupees in ‘000
9. BORROWINGS FROM FINANCIAL INSTITUTIONS
Details of borrowings (Secured / Unsecured)
Secured
Borrowings from State Bank of Pakistan 17,279,804 18,569,393

Repurchase agreement borrowings 11,940,880 29,474,488

Unsecured

Call borrowings 3,127,134 1,915,427
Other Borrowings 43,758 -
Overdrawn nostro accounts - 33,892

3,170,892 1,949,319
32,391,576 49,993,200

10. DEPOSITS AND OTHER ACCOUNTS
Customers
Fixed deposits 114,412,961 110,061,707
Savings deposits 113,927,781 106,782,794
Current accounts - Remunerative 79,888,623 57,667,849
- Non - remunerative 145,270,692 124,121,553
453,500,057 398,633,903
Financial Institutions
Remunerative deposits 699,196 560,816
Non - remunerative deposits 391,262 366,071
454,590,515 399,560,790


11 SHARE CAPITAL
11.1 Authorized capital

June 30, December 31, June 30, December 31,
2012 2011 2012 2011

1,500,000,000 1,500,000,000 Ordinary shares of Rs.10/- each 15,000,000 15,000,000

11.2 Issued, subscribed and paid-up capital
Fully paid-up Ordinary shares of Rs. 10/- each

June 30, December 31, Ordinary shares June 30, December 31,
2012 2011 2012 2011

406,780,094 406,780,094 Fully paid in cash 4,067,801 4,067,801
522,013,365 435,982,273 Issued as bonus shares 5,220,134 4,359,823

928,793,459 842,762,367 9,287,935 8,427,624
Amalgamation in accordance with the swap
ratio stipulated therein less 9,200,000
Ordinary shares of Rs. 10 each, held by
Ibrahim Leasing Limited on the cut-off date
9,148,550 9,148,550 (September 30, 2004) 91,486 91,486
Amalgamation of First Allied Bank Modaraba
with Allied Bank Limited in accordance with the
8,400,000 8,400,000 share swap ratio stipulated therein 84,000 84,000
946,342,009 860,310,917 9,463,421 8,603,110
Ibrahim Fibers Limited, related party of the Bank, holds 226,365,220 (23.92%) [December 31, 2011: 270,786,564
(31.4%)] ordinary shares of Rs.10 each, as at reporting date.
Un-audited Audited
2012 2011
Rupees in ‘000
12. CONTINGENCIES AND COMMITMENTS

12.1 Direct credit substitutes
Banks and financial institutions 606,923 611,478

12.2 Transaction-related contingent liabilities
Government 23,287,869 14,010,962
Others 12,276,973 21,208,164
35,564,842 35,219,126

12.3 Trade-related contingent liabilities
52,158,187 52,324,035
12.4 Claims against the Bank not acknowledged as debt 3,981,909 4,210,600
12.5 Commitments to extend credit
The Bank makes commitments to extend credit in the normal course of its business but these being revocable
commitments do not attract any significant penalty or expense if the facility is unilaterally withdrawn.
35
Un-audited Audited
2012 2011
Rupees in ‘000
12.6 Commitments in respect of forward foreign exchange contracts

Purchase 41,919,913 49,580,813
Sale 28,021,375 25,543,453

12.7 Commitments in respect of operating fixed assets

Civil works 1,034,741 1,496,831
Acquisition of operating fixed assets 520,588 504,141
1,555,329 2,000,972

12.8 Commitments in respect of lease financing 131,082 110,472

12.9 Commitments in respect of Market Treasury Bills - 3,926,578

12.10 Contingencies

12.10.1 There is no change in the status of contingencies, set out in note 22.11 to the consolidated financial
statements of the Bank for the year ended December 31, 2011, except for the contingency as mentioned
below:

12.10.2 The income tax assessments of the Bank have been finalized upto and including tax year 2011 for local
and Azad Kashmir operations. While finalizing income tax assessments upto tax year 2011, income tax
authorities made certain add backs with aggregate tax impact of Rs.12,301 million (2011: 10,718 million).
As a result of appeals filed by the Bank before appellate authorities, the add backs with tax impact
amounting to Rs.2,524 million (2011: 2,524 million) and Rs.9,229 million (2011: 9,229 million) were set-
aside and deleted respectively. While giving appeal effects on most of the deleted issues, a refund of
Rs.5,940 million (2011: 5,940 million) has been determined. Against most of the deleted and set-aside
issues, Department is in appeal before higher appellate authorities. Pending finalization of appeals no
provision has been made by the Bank on aggregate sum of Rs.12,301 million (2011: 10,718 million). The
management is hopeful that the outcome of these appeals will be in favor of the Bank.


2012 2011 2012 2011
Rupees in ‘000
13. MARK-UP / RETURN / INTEREST EARNED

On loans and advances 16,080,371 16,550,230 8,358,780 8,089,773

On investments in:
Available-for-sale securities 5,630,478 6,447,851 2,586,898 3,400,427

Held-to-maturity securities 2,003,626 363,293 983,294 170,872
Held-for-Trading 27,171 1,450 21,750 1,450
7,661,275 6,812,594 3,591,942 3,572,749
On deposits with financial institutions 1,675 930 26 729
On securities purchased under resale agreements 619,256 1,171,415 426,174 587,411
On certificates of investment - 5,682 - 3,542
On letters of placement 2,499 3,616 241 3,616
On call money lending 19,120 35,602 11,362 26,036

24,384,196 24,580,069 12,388,525 12,283,856
14. MARK-UP / RETURN / INTEREST EXPENSED

Deposits 10,638,525 10,014,489 5,709,523 4,965,038
Long term borrowing 122,634 155,775 59,141 76,858
Securities sold under repurchase agreements 1,271,754 90,938 346,227 61,062
Call money borrowing 238,613 69,910 119,212 39,689
Brokerage and commission 27,552 44,726 (24,318) 1,798
Markup on sub-ordinated loans 369,494 402,323 181,891 203,261
Other short term borrowings 1,704,305 1,410,675 852,089 735,494
14,372,877 12,188,836 7,243,765 6,083,200
15. EARNINGS PER SHARE - BASIC AND DILUTED

Profit after taxation for the period attributable to ordinary
shareholders 6,740,681 5,072,128 3,650,598 2,540,952

Number of Shares
Weighted average number of ordinary shares
outstanding during the period Restated Restated
15.1 946,342,009 946,342,009 946,342,009 946,342,009
Rupees
Restated Restated
Earnings per share - basic and diluted for the period 15.1 7.12 5.36 3.86 2.69
There is no dilution effect on basic earnings per share.
15.1 The comparative figures of weighted average number of shares outstanding and earnings per share have been
restated to include the effect of bonus shares issued by the Bank during the period.
37
38
16. RELATED PARTY TRANSACTIONS
The bank and its subsidiary have related party relationships with companies with common directorship, directors, employee benefit plans and key management personnel.

Contributions to the accounts in respect of staff retirement benefits are made in accordance with actuarial valuation / terms of the contribution plan. Remuneration of the key management personnel are in accordance with the terms
of their employment. Other transactions are at agreed terms.

Un-audited Audited
June 30, 2012 December 31, 2011

Directors Associated Key management Other related Directors Associated Kay management Other related
companies personel parties companies personel parties
Rupees in ‘000
Nature of related party transactions
Condensed Interim Financial Statements

Loans
Loans at the beginning of the period / year 49,969 - 203,005 - 61,581 - 211,703 16,061,896
Loans given during the period / year 8,952 - 56,021 - 23,757 - 37,765 464,087
Loans repaid/ adjustment during the period / year (13,156) - (52,421) - (35,369) - (46,463) (16,525,983)
Loans at the end of the period / year 45,765 - 206,605 - 49,969 - 203,005 -

Deposits
Deposits at the beginning of the period / year 17,270 48,985 13,556 230,430 9,821 93,965 16,128 3,042,357
Deposits received during the period / year 3,943,977 8,084,863 175,237 56,740,725 4,147,530 13,513,467 191,103 14,937,123
Deposits repaid during the period / year (3,947,519) (8,123,948) (161,900) (56,256,382) (4,140,081) (13,558,447) (193,675) (17,749,050)
Deposits at the end of the period / year 13,728 9,900 26,893 714,773 17,270 48,985 13,556 230,430

Nostro balances - 212,984 - - - 131,749 - -
Borrowings - 127,134 - - - 1,204,313 - -
Investments in shares/ open end mutual funds - 239,919 - 40,511,463 - 240,969 - 14,075,798
Other receivables - - - 51,581 - - - 74,071
Other payable - - - 1,448 - - - 13,630
Rent Payable - - - - - - - 731
Net receivable from
staff retirement benefit funds - - - 1,551,080 - - - 1,430,976
Un-audited Un-audited
June 30, 2012 June 30, 2011
Directors Associated Key management Other related Directors Associated Kay management Other related
companies personnel parties companies personnel
Rupees in ‘000
Mark-up earned 878 - 6,144 - 1,294 - 6,685 161,033

Income on placements - 26 - - - 4 - -
Income on lendings - - - - - 111 - -
Dividend income - - - 2,096,020 - - - 184,712
Sales Commission - - - 434 - - - 10,540
Management fee sharing expense - - - 111 - - - 3,074
Management fee income - - - 233,046 - - - 108,954
Mark-up expense on deposits 392 - 15 29,714 248 3 35 128,531
Interest expense on borrowings - 48,113 - - - 29,316 - -
Directors’ meeting fee 3,250 - - - 1,725 - - -
Remuneration - - 208,926 - - - 141,254 -
NIFT charges - - - 47,946 - - - 42,786
Bank charges levied - - - 169 - - - -
Rent Expense - 8,036 - - - 7,312 - -
Charge / (reversal) in respect of staff
retirement benefit funds - - - 100,093 - - - 104,675
39
17. SEGMENT DETAILS WITH RESPECT TO BUSINESS ACTIVITIES

The segment analysis with respect to business activity is as follows:-
Corporate Trading & Retail Commercial Payment & Asset Eliminations Total
Finance Sales Banking Banking Settlement Management
Rupees in ‘000

Total Income 337,167 1,527,281 19,827,741 26,148,818 327,556 273,893 (16,147,717) 32,294,739
Total Expenses (155,094) (2,004,763) (15,137,939) (24,058,930) (159,029) (186,020) 16,147,717 (25,554,058)
Net Income 182,073 (477,482) 4,689,802 2,089,888 168,527 87,873 - 6,740,681

Corporate Trading & Retail Commercial Payment & Asset Eliminations Total
Rupees in ‘000

Total Income 313,841 1,398,205 14,494,095 22,346,805 336,229 134,446 (11,317,313) 27,706,308
Total Expenses (159,338) (1,174,327) (12,271,262) (20,052,157) (199,203) (95,206) 11,317,313 (22,634,180)
Net Income 154,503 223,878 2,222,833 2,294,648 137,026 39,240 - 5,072,128
As at June 30, 2012 (Un-audited)

Corporate Trading & Retail Commercial Payment & Asset Total
Rupees in ‘000

Segment Assets Gross 375,192 13,403,832 106,211,940 456,161,973 331,882 767,614 577,252,433
As at December 31, 2011 (Audited)

Corporate Trading & Retail Commercial Payment & Asset Total
Rupees in ‘000

Segment Assets Gross 218,401 559,815 108,738,971 426,927,011 326,217 694,267 537,464,682
18. GENERAL
18.1 Figures have been rounded off to the nearest thousand rupees.
18.2 Corresponding figures have been re-arranged and reclassified to reflect more appropriate presentation
of transactions for the purpose of comparison. However, no significant reclassifications have been made
in these consolidated condensed interim financial statements.
18.3 The Board of Directors of the Bank in its meeting held on August 16, 2012 has approved second interim
cash dividend for the year ending December 31, 2012 at Rs. 1.5 per share (June 30, 2011: Cash dividend
of Rs. 2.5 per share). The consolidated condensed interim financial statements for the half year ended
June 30, 2012 do not include the effect of this appropriation and will be accounted for in the financial
statements of the period of declaration.
19. DATE OF AUTHORIZATION FOR ISSUE
These consolidated condensed interim financial statements were authorized for issue on 16 August,
2012 by the Board of Directors of the Bank.

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Condensed Interim Financial Statements

Unconsolidated Condensed Interim Financial Statements of

Unconsolidated Condensed Interim Statement of Financial Position.................08

Consolidated Condensed Interim Financial Statements of

Consolidated Condensed Interim Statement of Financial Position....................... 25

Board of Directors Company Secretary

Sheikh Mukhtar Ahmad Auditors

Abdul Aziz Khan

Pervaiz Iqbal Butt Haidermota and Company,

A. Akbar Sharifzada Shares Registrar

Sheikh Jalees Ahmed

To provide value added services to our customers

To provide high tech innovative solutions to meet customers’ requirements

To play a proactive role in contributing towards the society

Entity & TFC Ratings

Corporate Governance Rating

Best Investment Bank Award – Euromoney

For and on behalf of the Board,

Khalid Ahmed Sherwani

NET ASSETS 46,609,098 43,339,804

CONTINGENCIES AND COMMITMENTS 12

Chief Financial Officer President and Chief Executive Officer

Director Director Chairman

8 Condensed Interim Financial Statements

Half Year Ended Quarter Ended

Mark-up / return / interest earned 13 24,378,492 24,572,858 12,386,414 12,280,188

PROFIT BEFORE TAXATION 9,415,126 7,563,767 5,047,501 3,713,078

Chief Financial Officer President and Chief Executive Officer

Director Director Chairman

Half Year Ended Quarter Ended

Chief Financial Officer President and Chief Executive Officer

Director Director Chairman

10 Condensed Interim Financial Statements

Half Year Ended

Chief Financial Officer President and Chief Executive Officer

Director Director Chairman

Share Share Statutory Bonus Issue Special Merger General Un–appropriated

Total comprehensive income for the six months

Chief Financial Officer President and Chief Executive Officer

12 Condensed Interim Financial Statements

1. STATUS AND NATURE OF BUSINESS

5. Summary of significant accounting policies, estimates and risk management policies

Repurchase agreement lendings (Reverse Repo) 6.1 13,254,435 1,361,754

14 Condensed Interim Financial Statements

Held by Given as Total

Note Held by Given as Total Held by Given as Total

149,788,585 12,342,924 162,131,509 130,811,262 29,859,590 160,670,852

34,019,032 - 34,019,032 34,932,882 - 34,932,882

Total investments 186,840,894 12,301,184 199,142,078 165,806,713 29,887,409 195,694,122

Other assets especially mentioned 29,690 - 29,690 - -

16 Condensed Interim Financial Statements

December 31, 2011 (Audited)

June 30, 2012 (Un-audited) December 31, 2011 (Audited)

Specific General Total Specific General Total

Call borrowings 3,127,134 1,915,427

Un-audited Audited Un-audited Audited

18 Condensed Interim Financial Statements

Half Year ended Quarter ended