First Women Bank Limited. First Women Bank Ltd. Condensed Interim Financial Information (Un-audited)

Transcription

1 First Women Bank Limited. First Women Bank Ltd. Condensed Interim Financial Information (Un-audited) for the quarter ended as at 31 March 2010

2 First Women Bank Limited. DIRECTORS REPORT The Board of Directors of First Women Bank Ltd. is pleased to present condensed interim financial information (un-audited) for the Quarter ended as at 31 st March, Financial Highlights: As at 31 March 2010 (Rs. in 000 s) As at 31 December 2009 Advances gross : 3,208,575 3,481,854 Deposits : 9,487,621 8,756,793 Total Assets : 10,956,592 10,258,060 Paid up Capital 283, ,650 Reserves 228, ,540 Un-appropriated profit 549, ,128 Surplus on revaluation of assets net 32,575 35,049 Net Assets : 1,094,190 1,093,367 For the Quarter ended 31, March 2010 For the Quarter ended 31, March 2009 Profit before taxation, provision against advances & impairment charge 25,174 38,830 Provisions against NPLs & impairment charge against investments (19,481) (27,305) Profit before taxation 5,693 11,525 Taxation current & deferred (2,396) (3,567) Profit after taxation : 3,297 7,958 Advances to women /women owned Enterprises: To date, First Women Bank Ltd. has disbursed Rs. 22,917 million (March 2009: Rs. 19,645 million) with outreach to 46,959 borrowers (March 2009: 46,112 borrowers), of which Rs. 15,580 million has been disbursed to women, which constitute 68% financing to women. First Women Bank Ltd. caters to women at all socio-economic levels; Micro, Small & Medium and Corporate: o Micro-Credit : Rs. 2.9 billion, which constitute 18.6% of total disbursements o SMEs : Rs billion, which constitute 66.7% of total disbursements o Corporate : Rs. 2.3 billion, which constitute 14.7% of total disbursements Total Rs billion 100.0% 74.91% of the borrowers (March 2009: 75.95%) are in Micro-credit category i.e., women living under the line of poverty, 24.99% (March 2009: 23.94%) are in Small & Medium loans category and 0.10% (March 2009: 0.11%) are under Syndicate loans category. This reflects the model of First Women Bank Ltd. that caters to women at all levels of economic - 1 -

3 First Women Bank Limited. activity and takes very seriously its commitment and responsibility to support the economic and social well-being of the communities in which it operates. Deposits from Women/ Women owned Enterprises stood at Rs. 2,952 million. The number of women account holders is 55,729 which constitute 54.90% of the total account holders 101,500 as at 31 st March Keeping in view the economic slow down in the sectors being focused by the Bank, booking of new assets was handled cautiously and the Bank continued its efforts of cleaning-up any infections in the portfolio as such the net advances reflected decrease of 8.9%. Aggressive Deposits mobilization, to establish strong client-base, was the key marketing area that resulted an increase in Deposits by 8.3% from Rs. 8,756 million at December 2009 to Rs. 9,487 million at March Core banking income during the current quarter, compared with results for the corresponding quarter in the last year increased by 12.9% from Rs million to Rs million, which did not reflect positively in overall results due to booking of provisions of Rs million against NPLs. The provisions were lower by Rs. 7.8 million compared to the provisions booked in the preceding year s first quarter. Other income declined by Rs. 5.9 million and administrative costs increased by Rs million due to inflationary increases in expenses like Salaries & Allowances, rentals and utilities. EPS decreased by Rs from Rs to Rs per share. Market Recognition: The Pakistan Credit Rating Agency Ltd. (PACRA) has maintained the Bank s long-term and short-term entity ratings, on stand alone basis, at "BBB+" (Triple B Plus) and "A2" (A two), respectively, as per its press release issued on 9 th July, These ratings, as defined by PACRA, denote a low expectation of credit risk emanating from an adequate capacity for timely payment of financial commitments. Acknowledgement: The Board of Directors and the management of the Bank would like to place on record their gratitude to the Government of Pakistan, Ministry of Finance and the State Bank of Pakistan for their continued support and guidance. We also take this opportunity to express our gratitude to our valued customers and business partners for their continued trust and patronage. Finally, we are thankful to the staff for their commitment and continuous efforts to make FWBL a success. For and on behalf of the Board of Directors Shafqat Sultana Chairperson & President/ CEO Date : 28 April,

4 First Women Bank Limited Balance Sheet As at 31 March March 31 December Note Assets (Un-audited) (Audited) Cash and balances with treasury banks 737, ,140 Balances with other banks 450, ,849 Lendings to financial institutions 1,334,889 1,136,025 Investments - net 6 4,926,005 4,097,423 Advances - net 7 2,981,465 3,274,221 Operating fixed assets 205, ,972 Deferred tax assets - net 55,608 52,212 Other assets - net 265, ,218 10,956,592 10,258,060 Liabilities Bills payable 95,471 89,020 Borrowings 8 37,000 31,328 Deposits and other accounts 9 9,487,621 8,756,793 Subordinated loan - - Liabilities against assets subject to finance lease - - Deferred tax liabilities - - Other liabilities 242, ,552 9,862,402 9,164,693 Net assets 1,094,190 1,093,367 Represented by: Share capital , ,650 Reserves 228, ,540 Unappropriated profit 549, ,128 1,061,615 1,058,318 Surplus on revaluation of assets - net of tax 11 32,575 35,049 1,094,190 1,093,367 Contingencies and commitments 12 The annexed notes 1 to 16 form an integral part of these condensed interim financial information. Shahid Mughal Chief Financial Officer Shafqat Sultana President and Shafqat Sultana Atif R. Bokhari S. Ali Raza Batool Qureshi President and Director Director Director 1

5 First Women Bank Limited Profit and Loss Account (Un-audited) For the quarter ended 31 March 2010 Quarter ended Quarter ended Note 31 March March 2009 Mark-up / return / interest earned 277, ,518 Mark-up / return / interest expensed 144,248 58,082 Net mark-up / interest income 133, ,436 Provision for diminution in the value of investments - 3,674 Provision against advances - net 19,481 23,631 Bad debts written off directly ,481 27,305 Net mark-up / interest income after provisions 114,197 91,131 Non-mark-up / interest income Fee, commission and brokerage income 4,893 4,860 Dividend income 3,081 - Income from dealing in foreign currencies 914 4,813 Gain on sale of securities - net - 5,036 Other income 4,054 4,147 Total non-mark-up / interest income 12,942 18, , ,987 Non-mark-up / interest expenses Administrative expenses 121,446 97,068 Other provisions / write offs / (reversals) - - Other charges - 1,394 Total non-mark-up / interest expenses 121,446 98,462 Extra ordinary / unusual item - - Profit before taxation 5,693 11,525 Taxation - current year 6,407 11,837 - prior years deferred (4,011) (8,270) 2,396 3,567 Profit after taxation 3,297 7,958 Unappropriated profit brought forward 546, ,610 Transferred to statutory reserve - (1,592) Transfer from surplus on revaluation of fixed assets - net of tax , ,163 Profit available for appropriation 549, ,121 Basic and diluted earnings per share - after tax The annexed notes 1 to 16 form an integral part of these condensed interim financial information. Shahid Mughal Chief Financial Officer Shafqat Sultana President and Shafqat Sultana Atif R. Bokhari S. Ali Raza Batool Qureshi President and Director Director Director 2

6 First Women Bank Limited Statement of Comprehensive Income (Un-audited) For the quarter ended 31 March 2010 Quarter ended Quarter ended 31 March March 2009 Profit for the period 3,297 7,958 Other comprehensive income for the period - - Total comprehensive income - profit for the period 3,297 7,958 The annexed notes 1 to 16 form an integral part of these condensed interim financial information. Shahid Mughal Chief Financial Officer Shafqat Sultana President and Shafqat Sultana Atif R. Bokhari S. Ali Raza Batool Qureshi President and Director Director Director 3

7 First Women Bank Limited Cash Flow Statement (Un-audited) For the quarter ended 31 March 2010 Note Quarter ended Quarter ended 31 March March 2009 CASH FLOWS FROM OPERATING ACTIVITIES Profit before taxation 5,693 11,525 Dividend income (3,081) - 2,612 11,525 Adjustments for non-cash charges: Depreciation 2,391 4,565 Amortisation of intangible assets 1, Provision for diminution in the value of investments - 3,674 Amortisation of premium and discount on investment - net 15,776 6,388 Provision against advances - net 19,481 23,631 38,651 38,607 41,263 50,132 (Increase) / decrease in operating assets Lendings to financial institutions (198,864) (60,577) Advances - net 273, ,436 Others assets (excluding advance taxation) (52,204) (35,313) 22, ,546 Increase / (decrease) in operating liabilities Bills payable 6,451 (11,655) Borrowings 5,672 3,000 Deposits and other accounts 730,828 (90,588) Other liabilities (45,242) (20,431) 697,709 (119,674) 761,183 37,004 Income tax paid (30,650) (19,740) Net cash flows from operating activities 730,533 17,264 CASH FLOWS FROM INVESTING ACTIVITIES Net investments in available-for-sale investments (844,358) (36,876) Dividend income received 9,241 - Investments in operating fixed assets (7,556) (1,195) Net cash flows from investing activities (842,673) (38,071) Decrease in cash and cash equivalents (112,140) (20,807) Cash and cash equivalents at beginning of the period 1,299, ,690 Cash and cash equivalents at end of the period 15 1,187, ,883 The annexed notes 1 to 16 form an integral part of these condensed interim financial information. Shahid Mughal Chief Financial Officer Shafqat Sultana President and Shafqat Sultana Atif R. Bokhari S. Ali Raza Batool Qureshi President and Director Director Director 4

8 First Women Bank Limited Statement of Changes in Equity (Un-audited) For the quarter ended 31 March 2010 Share Statutory Revenue reserve Total capital reserve unappropriated profit Balance as at 01 January , , ,610 1,135,800 Changes in equity for the quarter ended 31 March 2009 Total comprehensive income for the quarter - profit for the period - - 7,958 7,958 Transferred from surplus on revaluation of fixed assets to unappropriated profit - net of tax Transferred to statutory reserve - 1,592 (1,592) - Balance as at 31 March , , ,121 1,143,903 Changes in equity for the nine months period ended 31 December 2009 Total comprehensive income for the period - loss for the period - - (88,059) (88,059) Transferred from surplus on revaluation of - fixed assets to unappropriated profit - net of tax - 2,474 2,474 Transferred to statutory reserve - (1,592) 1,592 - Balance as at 01 January , , ,128 1,058,318 Changes in equity for the quarter ended 31 March 2010 Total comprehensive income for the period - profit for the period - - 3,297 3,297 Transferred from surplus on revaluation of fixed assets to unappropriated profit - net of tax Transferred to statutory reserve Balance as at 31 March , , ,425 1,061,615 Shahid Mughal Chief Financial Officer Shafqat Sultana President and Shafqat Sultana Atif R. Bokhari S. Ali Raza Batool Qureshi President and Director Director Director 5

9 First Women Bank Limited Notes to the Condensed Interim Financial Information (Un-audited) For the quarter ended 31 March STATUS AND NATURE OF BUSINESS First Women Bank Limited ("the Bank") was incorporated under the Companies Ordinance, 1984 on 21 November 1989 in Pakistan as an unquoted public limited company and commenced operations on 2 December The Bank is engaged in commercial banking and related services. The registered office of the Bank is situated at ground floor, S.T.S.M. Foundation Building, Civil Lines, Karachi. The number of branches as at 31 March 2010 was thirty eight (31 December 2009: thirty eight). 2. BASIS OF PRESENTATION The disclosures in these condensed interim financial information have, however been limited, based on the format prescribed by the State Bank of Pakistan vide BSD Circular No. 2 dated 12 May 2004 and International Accounting Standard 34, 'Interim Financial Reporting' (IAS 34). These condensed interim financial information do not include all of the information required for full annual financial statements, and these condensed interim financial information should be read in conjunction with financial statements of the Bank for the year ended 31 December STATEMENT OF COMPLIANCE 3.1 These condensed interim financial information have been prepared in accordance with approved accounting standards as applicable in Pakistan. Approved accounting standards comprise of such International Financial Reporting Standards (IFRS) issued by the International Accounting Standards Board (IASB) as are notified under the Companies Ordinance, 1984, provisions of and directives issued under the Companies Ordinance, 1984 and Banking Companies Ordinance, 1962 and the directives issued by the State Bank of Pakistan (SBP) and the Securities and Exchange Commission of Pakistan (SECP). In case the requirements differ, the provisions of and directives issued under the Companies Ordinance, 1984 and Banking Companies Ordinance, 1962 and the directives issued by SBP and SECP shall prevail. 3.2 The SBP, vide its BSD Circular Letter No. 10 dated 26 August 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 SECP dated 28 April 2008, International Financial Reporting Standard 7, 'Financial Instruments Disclosure' (IFRS 7) has not been made applicable for banks. Accordingly, the requirements of these standards have not been considered in the preparation of these condensed interim financial information. However, investments have been classified and valued in accordance with the requirements prescribed by SBP through various circulars. 3.3 New standards, amendments and interpretations that were mandatory for accounting periods beginning on or after 01 January 2010 and are not considered to be relevant nor have any significant effect on the Bank's operations, are not detailed in these condensed interim financial information. 4. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The accounting policies adopted in the preparation of these condensed interim financial information are the same as those applied in the preparation of annual financial statements of the Bank for the year ended 31 December FINANCIAL RISK MANAGEMENT The financial risk management objectives and policies are consistent with those disclosed in the financial statements of the Bank for the year ended 31 December INVESTMENTS - net 6.1 Investments by types 31 March 2010 (Un-audited) 31 December 2009 (Audited) Held by Given as Total Held by Given as Total bank collateral bank collateral Available-for-sale - Market Treasury Bills 3,494,524-3,494,524 2,664,927-2,664,927 - Pakistan Investment Bonds 1,181,261-1,181,261 1,185,053 1,185,053 - Term Finance Certificates 49,714-49,714 53,464-53,464 - Units / certificates of mutual funds 60,000-60,000 50,000-50,000 - Preference shares of a listed company 10,000-10,000 10,000 10,000 - Shares of an unlisted company ,796,453-4,796,453 3,964,398-3,964,398 Held-to-maturity - Pakistan Investment Bonds 222, , , ,292 Investments at cost 5,019,131-5,019,131 4,188,690-4,188,690 Provision for diminution in value of investments (15,604) - (15,604) (15,604) - (15,604) Investments (net of provisions) 5,003,527-5,003,527 4,173,086-4,173,086 Deficit on revaluation of available for sale securities - net (77,522) - (77,522) (75,663) - (75,663) Investments at revalued amounts 4,926,005-4,926,005 4,097,423-4,097,423 6

10 7. ADVANCES - net 31 March 31 December 2010 (Un-audited) 2009 (Audited) Loans, cash credits, running finances, etc. In Pakistan 3,208,575 3,481,854 Provision against advances Specific provision 224, ,222 General provision 2,115 1, , ,633 Advances - net 2,981,465 3,274, Advances include Rs million (31 December 2009: Rs million) which have been placed under the non-performing status as in note Particulars of advances (gross) In local currency 3,208,575 3,481,854 In foreign currencies - - 3,208,575 3,481, Category of 31 March 2010 (Un-audited) classification Total Specific Specific domestic provision provision required held Substandard 144,424 32,519 32,519 Doubtful 19,883 9,941 9,941 Loss 182, , , , , ,995 Category of 31 December 2009 (Audited) classification Total Specific Specific domestic provision provision required held Substandard 136,053 23,736 23,736 Doubtful 12,047 6,023 6,023 Loss 182, , , , , , BORROWINGS 31 March 31 December (Un-audited) (Audited) Secured Borrowings from State Bank of Pakistan under -Export refinance scheme 37,000 31,328 -Locally manufactured machinery ,000 31,328 Unsecured Call borrowings 9. DEPOSITS AND OTHER ACCOUNTS ,000 31,328 Customers Fixed deposits 1,204,076 1,242,612 Savings deposits 3,345,587 3,360,424 Current (saving cum current) accounts - remunerative 3,313,668 2,430,347 Current accounts - non remunerative 1,486,421 1,532,206 Call deposits 112, ,584 Sundry deposits 23,430 38,221 9,485,376 8,729,394 Financial institutions Remunerative deposits 2,009 2,193 Non-remunerative deposits ,206 2,245 27,399 9,487,621 8,756,793 7

11 Note 31 March 31 December 9.1 Particulars of deposits (Un-audited) (Audited) In local currency 8,919,375 8,176,945 In foreign currencies 568, ,848 9,487,621 8,756, SHARE CAPITAL According to BSD Circular No. 07 of 2009 dated 15 April 2009, the Bank is required to raise its paid-up capital to Rs. 7 billion (free of losses) by 31 December However, the State Bank of Pakistan (SBP) through its letter reference BSD/BAI-3/608/189/2010 dated 01 March 2010 has granted the Bank an extension to meet the Minimum Paid-up Capital Requirement (MCR) up till 31 December 2010 or re-capitalisation / restructuring of the Bank, whichever occurs earlier. 11. SURPLUS ON REVALUATION OF ASSETS - net of tax Surplus / (deficit) arising on revaluation (net of tax) of: - fixed assets 83,181 83,181 - available-for-sale securities 11.1 (50,606) (48,132) 32,575 35, Deficit on revaluation of available-for-sale securities - net of tax Federal Government securities (76,206) (78,057) Listed securities - Units / certificates of mutual funds / preference shares - net (2,124) 4,194 - Listed term finance certificates 808 (1,800) (1,316) 2,394 (77,522) (75,663) Related deferred tax asset - net 26,916 27,531 (50,606) (48,132) 12. CONTINGENCIES AND COMMITMENTS 12.1 Transaction-related contingent liabilities Guarantees in favour of: Government 36,614 54,761 Others 660 1,149 37,274 55,910 8

12 31 March 31 December 12.2 Trade-related contingent liabilities (Un-audited) (Audited) Letter of credit and acceptances on behalf of: Government 1,954 2,706 Others - 11,788 1,954 14, Other contingencies Claims against the Bank not acknowledged as debt 154, , Commitment in respect of forward foreign exchange contracts Purchase 84,253 - Sale 84, Commitment for the acquisition of operating fixed assets Capital commitments - 1, Taxation Income tax assessments of the Bank have been finalised up to and including the tax year 2008 (financial year ended 31 December 2007) while the return for the tax year 2009 (financial year ended 31 December 2008) has been filed which is deemed to have been assessed under section 120 of the Income Tax Ordinance, 2001 (unless selected for audit). The tax authorities have made certain disallowances primarily against Nostro account balances and bad debts written-off by the Bank and unrealised income suspended by the Bank in respect of the tax years from 2004 to 2008 (financial years ended 31 December 2003 to 31 December 2007) against which appeals have been filed by the Bank at appellate forums. In case of adverse decisions, additional charge to the Bank would be Rs million. However, the management is confident that the decision in appeals would be in its favour and as such no provision has been made against the above amount. 9

13 13. RELATED PARTY TRANSACTIONS AND BALANCES The Bank has related party relationships with associated undertakings, employee benefits, directors and key management personnel and companies with common directors. There are no transactions with key management personnel other than under their terms of employment. Contribution to and accruals in respect of staff retirement benefit plans are made in accordance with actuarial valuation / terms of the contribution plan. Other transactions are at agreed terms. The details of transactions with related parties are as follows: A Balances Deposits Directors Associated Undertaking Key management personnel Other related parties (Un-audited) (Audited) (Un-audited) (Audited) (Un-audited) (Audited) (Un-audited) (Audited) Mar-10 Dec-09 Mar-10 Dec-09 Mar-10 Dec-09 Mar-10 Dec Balance at beginning of the period / year 1,296 1,734 25,022-3,381 3,250 25,508 67,622 Deposited during the period / year 2,131 29,252-25,027 11,469 63,097 71, ,657 Withdrawn during the period / year 1,903 30,415 25, ,798 62,240 76, ,771 Adjustment* (726) - - Balance at end of the period / year 1,524 1, ,022 4,052 3,381 20,794 25,508 Deposits carry mark-up rate at 5% to 13% per annum (31 December 2009: 5% to 13% per annum). Mark-up / return / interest expensed ,071 Mark-up payable in local currency Advances (secured) Balance at beginning of the period / year - 4,980 41,666 58,333 7,677 3,385 57,795 57,789 Loans granted during the period / year ,000-4, Repayments received during the period / year , Adjustment - (5,358) Balance at end of the period / year ,666 41,666 7,509 7,677 57,798 57,795 Advances carry profit rates ranging from 5% to 14.8 % per annum (31 December 2009: 5% to 14.8% per annum) Mark-up / return / interest earned ,391 7, ,959 7,803 Mark-up receivable in local currency - - 1, ,959 1,970 B Other transactions and balances (including profit and loss related transactions) Associated undertakings Other related parties Balances as at the period / year end (Un-audited) (Audited) (Un-audited) (Audited) Mar-10 Dec-09 Mar-10 Dec Cash and balance with treasury bank 11,001 38, Balances with other banks 16,757 55, Investment in National Institutional Facilitation Technologies (Private) Limited Investment in MCB Cash Optimizer Fund (at market value) 21,075 20, Investment in United Income Growth Fund (at market value) 10,516 10, Mark-up receivable in local currency 1, MCB ATM settlement account balance Net payable from defined benefit plan - - (9,515) (9,515) Payable to defined contribution plan Transactions during the period / year Interest income on lendings to financial institutions 5,121 69, Interest expense on repurchase agreement borrowings Dividend income 3,456 6, Charge for retirement benefits Approved pension fund - - 4,635 20,791 Approved gratuity fund ,651 Contributory provident fund , ,856 34,574 Proceeds from sale of fixed assets ,895 Remuneration of key management personnel - - 4,694 18,157 10

14 31 March 31 March (Un-audited) (Audited) 14. BASIC AND DILUTED EARNINGS PER SHARE Profit after taxation 3,297 7,958 Weighted average number of ordinary shares outstanding during the period / year 28,365,000 28,365,000 (Rupees) Basic and diluted earnings per share March 31 December (Un-audited) (Audited) 15. CASH AND CASH EQUIVALENTS Cash and balances with treasury banks 737, ,140 Balances with other banks 450, ,849 1,187,849 1,299, DATE OF AUTHORISATION FOR ISSUE (Number of shares) These condensed interim financial information were authorised for issue by the Board of Directors of the Bank in their meeting held on 28 April, Shahid Mughal _Shafqat Sultana Chief Financial Officer President and Shafqat Sultana Atif R. Bokhari S. Ali Raza Batool Qureshi President and Director Director Director 11