ÓcuywR evrv i wewb qvm SuzwKc~Y R b I ey S wewb qvm KiybÓ

Transcription

1 f Prospectus ofslicl ÓcuywR evrv i wewb qvm SuzwKc~Y R b I ey S wewb qvm KiybÓ Investment in capital market involves certain degree of risks. The investors are required to read the prospectus and risk factors carefully, assess their own financial conditions and risk taking ability before making their investment decisions. PUBLIC ISSUE OF 19,000,000ORDINARY SHARES OFFER PRICE Tk EACH AT PAR, TOTAL SIZE OF FUND TO BE RAISED Tk.19,00,00, Opening date of Subscription:., 2018 Closing date of Subscription:., 2018 PROSPECTUS Of Sonali Life Insurance Company Limited MANAGER TO THE ISSUE ICB Capital Management Limited Green City Edge (5 th & 6 th Floor), 89 Kakrail, Dhaka Agrani Equity & Investment Limited Swantex bhaban (4 th floor) 9/1, Motijheel C/A, Dhaka Web: Issue Date of theprospectus:

2 Preliminary Information and Declarations I) Name(s), address(s), telephone number(s), web address(s), (s), fax number(s) and contact persons of the issuer, issue manager(s), underwriter(s), auditors, credit rating company and valuer, where applicable; Issuer Company Sonali Life Insurance Company Limited Rupali Bima Bhaban, 7 RAJUK Avenue, Dhaka Head Office(Ext.) 68/B,DIT Road, MAlibagh, Dhaka. Contact person Telephone, Fax Number, & web address Ajit Chandra Aich Managing IP Phone: Fax: info@sonalilife.com Web: Manager to the Issue ICB Capital Management Ltd. Green City Edge (5 th & 6 th Floor), 89 Kakrail, Dhaka Agrani Eqiuty& Investment Limited Swantex bhaban (4th floor) 9/1, Motijheel C/A, Dhaka Contact person Md. Sohel Rahman Chief Executive Officer (Additional Charge) Ahmed Yousuf Abbas Chief Executive Officer Telephone, Fax Number, & web address Tel: , , , FAX: info@icml.com.bd Web: Tel: , FAX: info@equity.com Web: Underwriters ICB Capital Management Ltd. Green City Edge (5 th & 6 th Floor), 89 Kakrail, Dhaka Auditor Ahmad and Akthar. Chartered Accountants BCIC Bhaban (3 rd Floor) 30-31, Dilkusha C/A. Dhaka-1000 Valuer Z.Halim & Associates Empori Parkview,Flat 9A,House1/C, Road-86,North Gulshan,Dhaka-1212 Contact person Md. Sohel Rahman Chief Executive Officer (Additional Charge) Mohammed Naser Chief Executivee Officer Zafar Halim Actuary Fully Regulated Member of UK acturaial Profession Telephone, Fax Number, & web address Tel: , , , FAX: info@icml.com.bd Web: Tel: Fax: aacano120@gmail.com Web: Tel: mail:ceo@zhalim.com i

3 ii) "A person interested to get a Prospectus may obtain from the issuer and the issue manager" iii) If you have any query about this document, you may consult the issuer, issue manager and underwriter IV) CONSENT OF THE BANGLADESH SECURITIES AND EXCHANGE COMMISSION HAS BEEN OBTAINED TO THE ISSUE OROFFER OF THESE SECURITIES UNDER THE SECURITIES AND EXCHANGE ORDINANCE, 1969, AND THE BANGLADESH SECURITIES AND EXCHANGE COMMISSION (PUBLIC ISSUE) RULES, IT MUST BE DISTINCTLY UNDERSTOOD THAT IN GIVING THIS CONSENT THE COMMISSION DOES NOT TAKE ANY RESPONSIBILITY FOR THE FINANCIAL SOUNDNESS OF THE ISSUER COMPANY, ANY OF ITS PROJECTS OR THE ISSUE PRICE OF ITS SECURITIES OR FOR THE CORRECTNESS OF ANY OF THE STATEMENTS MADE OR OPINION EXPRESSED WITH REGARD TO THEM. SUCH RESPONSIBILITY LIES WITH THE ISSUER, ITS DIRECTORS, CHIEF EXECUTIVE OFFICER, MANAGING DIRECTOR, CHIEF FINANCIAL OFFICER, COMPANY SECRETARY, ISSUE MANAGER, ISSUE MANAGER S CHIEF EXECUTIVE OFFICER,UNDERWRITERS, AUDITOR(S), VALUER AND/OR CREDIT RATING COMPANY(IF ANY)." V) Risks in relation to the First Issue This being the first issue of the issuer, there has been no formal market for the securities of the issuer. The face value of the securities is Tk (ten) and the issue price is Tk i.e. the face value.the issue price has been determined and justified by the issuer and the issue manager as stated under the paragraph on Justification of Issue Price should not be taken to be indicative of the market price of the securities after listing. No assurance can be given regarding an active or sustained trading of the securities or the price after listing VI) General Risk Investment in securities involves a degree of risk and investors should not invest any funds in this offer unless they can afford to take the risk of losing their investment. Investors are advised to read the risk factors carefully before taking an investment decision in this offer. For taking an investment decision, investors must rely on their own examination of the issuer and the offer including the risks involved. The securities have not been recommended by the Bangladesh Securities and Exchange Commission (BSEC) nor does BSEC guarantee the accuracy or adequacy of this document. Specific attention of investors is invited to the statement of risk factors given on page number(s) VII)Sonali life life insurance company limited Absolute Responsibility "The issuer, having made all reasonable inquiries, accepts responsibility for and confirms that this prospectus contains all material information with regard to the issuer and the issue, that the information contained in the prospectus are true, fair and correct in all material aspects and are not misleading in any respect, that the opinions and intentions expressed herein are honestly held and that there are no other facts, the omission of which make this document as a whole or any of such information or the expression of any such opinions or intentions misleading in any material respect." ii

4 AVAILABILITY OF PROSPECTUS (i) Names, addresses, telephone numbers, fax numbers, website addresses and addresses and names of contact persons of the institutions where the prospectus and abridged version of prospectus are available in hard and soft forms; The Prospectus and Abridge version of Prospectus of Sonali life Insurance Company Limited are available in hard and soft forms at the following addresses Issuer Company Sonali Life Insurance Company Limited Rupali Bima Bhaban, 7 RAJUK Avenue, Dhaka Head Office(Ext.) 68/B,DIT Road, MAlibagh, Dhaka. Contact person Telephone, Fax Number, & web address Ajit Chandra Aich Managing IP Phone: Fax: info@sonalilife.com Web: Manager to the Issue Contact person Telephone, Fax Number, & web address ICB Capital Management Ltd. Green City Edge (5 th & 6 th Floor), 89 Kakrail, Dhaka Md. Sohel Rahman Chief Executive Officer (Additional Charge) Tel: , , , FAX: info@icml.com.bd Agrani Eqiuty & Investment Limited Swantex bhaban (4th floor) 9/1, Motijheel C/A, Dhaka Ahmed Yousuf Abbas Chief Executive Officer Web: Tel: , FAX: info@equity.com Web: Underwriters ICB Capital Management Ltd. Green City Edge (5 th & 6 th Floor), 89 Kakrail, Dhaka Contact person Md. Sohel Rahman Chief Executive Officer (Additional Charge) Telephone, Fax Number, & web address Tel: , , , FAX: info@icml.com.bd Web: Stock Exchanges Dhaka Stock Exchange Ltd (DSE) DSE Library, Research and Information Department 9/F, Motijheel C/A, Dhaka Chittagong Stock Exchange Ltd (CSE) CSE Building, 1080, Sk. Mujib Road Agrabad, Chittagong Dhaka Liaison Office: Eunoos Trade Center (Level-15) Dilkusha C/A, Dhaka Contact person Md. Afzalur Rahman Manager Mohammed JabedSarwar Assistant Manager Telephone, Fax Number, & web address Tel: Fax: research@dsebd.org; web: Tel: Fax: jabed@cse.com.bd; Web: Prospectus is also available on the websites of Sonali Life Insurance Company Limited( ICB Capital Management Limited ( ( ( DSE ( CSE ( and Public Reference room of the Bangladesh Securities and Exchange Commission (BSEC) for reading and studying. iii

5 ii) Names and dates of the newspapers where abridged version of prospectus was published Sl. No. Name of the News paper Date of Publication Page number of the newspaper iv

6 iii) Definitions and Acronyms or Elaborations Term Elaboration A Allotment : Letter of Allotment for Shares B BSEC : Bangladesh Securities and Exchange Commission BAS : Bangladesh Accounting Standards BB : Bangladesh Bank BSA : Bangladesh Standard of Auditing BO A/C : Beneficiary Owner s Account or Depository Account C CDBL : Central Depository Bangladesh Limited Certificate : Share Certificate CIB : Credit Information Bureau Commission : Bangladesh Securities and Exchange Commission Companies Act : Companies Act, 1994 (Act No. XVIII of 1994) CSE : Chittagong Stock Exchange Limited D Depository Act : Depository Act, 1999 DSE : Dhaka Stock Exchange Limited E ERP : Enterprise Resource Planning F FC Account : Foreign Currency Account FI : Financial Institution G GOB : Government of The People s Republic of Bangladesh I IAS : International Accounting Standards IDRA : Insurance Development Regulatory Authority IPO : Initial Public Offering Issue : Public Issue of Shares of Sonali Life Insurance Company Limited Issuer : Sonali Life Insurance Company Limited N NBR : National Board of Revenue NRB : Non-Resident Bangladeshi O Offer Price : The Price of the Shares of Sonali Life Insurance Company Limited being Offered Ordinance : Securities and Exchange Ordinance, 1969 P PTS : Primary Textile Sector R Registered Office : Head Office of the Company RJSC : Registrar of Joint Stock Companies & Firms S Securities/Shares : Shares of Sonali Life Insurance Company Limited SLICL Sonali Life Insurance Company Limited Sponsors : The Sponsor Shareholders of Sonali Life Insurance Company Limited SND Accounts : Short Notice Deposit Account Stockholders : Shareholders Subscription : Application Money v

7 TABLE OF CONTENTS Particulars Page No. CHAPTER I EXECUTIVE SUMMARY 1-5 About the industry 1 About the Issuer 1 Financial Information 2 Features of the issue and its objects 2 Legal and Other Information 2 Promoters background 2 Capital structure and history of capital raising 4 Summary of Valuation Report of Securities 4 Others 5 CHAPTER II CONDITIONS IMPOSED BY THE COMMISSION 6-12 Disclosure In Respect Of Issuance Of Security In Demat Form 6 Conditions Under 2cc Of The Securities And Exchange Ordinance, Application Process 8 CHAPTER III DECLARATION AND DUE DILIGENCE CERTIFICATES Declaration About The Responsibility Of The s, Including The Ceo Of The Issuer In Respect Of The Prospectus 13 Due Diligence Certificate By Issue Manager 14 Due Diligence Certificate By The Underwriter 17 CHAPTER IV ABOUT THE ISSUER CHAPTER V CORPORATE DIRECTORY OF THE ISSUER 23 CHAPTER VI DESCRIPTION OF THE ISSUER Summary of the Industry 24 Summary of consolidated financial, operating and other Information 24 General Information 24 Capital Structure 35 Description of the Business 40 Description of Property 49 Plan of Operation and Discussion of Financial Condition 57 CHAPTER VII MANAGEMENT S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION Overview of business and strategies 75 SWOT analysis 75 Analysis of the financial statements of last five years with reason(s) of fluctuating revenue/sales, other income, total income, cost of material, finance cost, depreciation and amortization expense, other expense; changes of inventories, 76 net profit before & after tax, EPS etc. Known trends demands, commitments, events or uncertainties that are likely to have an effect on the company s business. 77 Trends or expected fluctuations in liquidity 77 Off-balance sheet arrangements those have or likely to have a current or future effect 77 on financial condition. CHAPTER VIII DIRECTORS AND OFFICERS Name, Father s name, age, residential address, educational qualification, experience and position of each of the directors of the company and any person nominated/represented to be a director, showing the period for which the nomination has been made and the name of the organization which has nominated him; Changes in the key management persons during the last three years vi

8 A profile of the sponsors including their names, father s names, age, personal addresses, educational qualifications, and experiences in the business, positions/posts held in the past, directorship held, other ventures of each sponsor and present position If the present directors are not the sponsors and control of the issuer was acquired within five years immediately preceding the date of filing Prospectus details regarding the acquisition of control, date of acquisition, terms of acquisition, consideration paid for such acquisition etc. If the sponsors/directors do not have experience in the proposed line of business, the fact explaining how the proposed activities would be carried out/managed Interest of the Key management persons 88 All Interest and facilities enjoyed by the directors, whether pecuniary or non-pecuniary 88 Number of Shares held and percentage of Shareholding (Pre issue) 89 Changes in the Board of s in last three years 89 's engaged with similar business 90 CHAPTER IX CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS CHAPTER X EXECUTIVE COMPENSATION The total amount of remuneration/salary/perquisites paid to the top five salaried officers of the issuer in the last accounting year and the name and designation of each such officer: Aggregate amount of remuneration paid to all directors and officers as a group during the last accounting year: If any shareholder director received any monthly salary/perquisite/benefit it must be mentioned along with date of approval in AGM/EGM, terms thereof and payments made during the last accounting year: The board meeting attendance fees received by the director including the managing director along with date of approval in AGM/EGM: 94 Any contract with any director or officer providing for the payment of future compensation 95 If the issuer intends to substantially increase the remuneration paid to its directors and officers in the current year, appropriate information regarding thereto: 95 Any other benefit/facility provided to the above persons during the last accounting year 95 CHAPTER XI OPTIONS GRANTED TO DIRECTORS, OFFICERS AND EMPLOYEES 96 CHAPTER XII TRANSACTION WITH THE DIRECTORS AND SUBSCRIBERS TO THE MEMORANDUM CHAPTER XIII OWNWRSHIP OF THE COMPANY S SECURITIES The names, addresses, BO ID Number of all shareholders of the company before IPO, indicating the amount of securities owned and the percentage of the securities 99 represented by such ownership: There shall also be a table showing the name and address, age, experience, BO ID Number, TIN number, numbers of shares held including percentage, position held in 100 other companies of all the directors before the public issue: The average cost of acquisition of equity shares by the directors certified by the auditors 103 A detail description of capital built up in respect of shareholding (name-wise) of the 104 issuer s sponsors/ directors. In this connection, a statement to be included: Detail of shares issued by the company at a price lower than the issue price: 106 History of significant (5% or more) changes in ownership of securities from inception 106 CHAPTER XIV CORPORATE GOVERNANCE Management disclosure regarding compliance with the requirements of Corporate Governance Guidelines of the Bangladesh Securities and Exchange Commission (BSEC); A compliance report of Corporate Governance requirements certified by competent authority vii

9 Details relating to the issuer's audit committee and remuneration committee, including the names of committee members and a summary of the terms of reference under which 113 the committees operate. CHAPTER XV VALUATION REPORT OF SECURITIES PREPARED BY THE ISSUE MANAGER CHAPTER XVI DEBT SECURITIES 125 CHAPTER XVII PARTIES INVOLVED AND THEIR RESPONSIBILITIES 126 CHAPTER XVIII MATERIAL CONTRACTS CHAPTER XIX OUTSTANDING LITIGATIONS, FINE OR PENALTY 130 CHAPTER XX RISK FACTORS AND MANAGEMENT S PERCEPTIONS ABOUT THE RISKS CHAPTER XXI DESCRIPTION OF THE ISSUE 142 CHAPTER XXII USE OF PROCEEDS Use of net proceeds of the offer indicating the amount to be used for each purpose with head-wise break-up; 143 Utilization of the total amount of paid-up capital and share premium, if any, including the sponsors contribution and capital raised of the issuer at the time of submission of 143 prospectus, in details with indication of use of such funds in the financial statements; If one of the objects is an investment in a joint venture, a subsidiary, an associate or any acquisition, details of the form of investment, nature of benefit expected to accrue to the issuer as a result of the investment, brief description of business and financials 144 of such venture; If IPO proceeds are not sufficient to complete the project, then source of additional fund must be mentioned. In this connection, copies of contract to meet the additional funds are required to be submitted to the Commission. The means and source of financing, 144 including details of bridge loan or other financial arrangement, which may be repaid from the proceeds of the issue along with utilization of such funds; A schedule mentioning the stages of implementation and utilization of funds received through public offer in a tabular form, progress made so far, giving details of land acquisition, civil works, installation of plant and machinery, the approximate date of completion of the project and the projected date of full commercial operation etc. The 144 schedule shall be signed by the Chief Executive Officer or Managing, Chief Financial Officer and Chairman on behalf of Board of s of the issuer; If there are contracts covering any of the activities of the issuer for which the proceeds of sale of securities are to be used, such as contracts for the purchase of land or contracts for the construction of buildings, the issuer shall disclose the terms of such 144 contracts, and copies of the contracts shall be enclosed as annexure to the prospectus; If one of the objects of the issue is utilization of the issue proceeds for working capital, basis of estimation of working capital requirement along with the relevant assumptions, reasons for raising additional working capital substantiating the same with relevant facts 144 and figures and also the reasons for financing short with long term investments and an item wise break-up of last three years working capital and next two years projection; Where the issuer proposes to undertake one or more activities like diversification, modernization, expansion, etc., the total project cost activity-wise or project wise, as the 144 case may be; Where the issuer is implementing the project in a phased manner, the cost of each phase, including the phases, if any, which have already been implemented; 145 The details of all existing or anticipated material transactions in relation to utilization of the issue proceeds or project cost with sponsors, directors, key management personnel, 145 associates and group companies; Summary of the project appraisal/ feasibility report by the relevant professional people with cost of the project and means of finance, weaknesses and threats, if any, as given 145 in the appraisal/ feasibility report. CHAPTER XXIII LOCK-IN CHAPTER XXIV MARKETS FOR THE SECURITIES BEING OFFERED 148 viii

10 CHAPTER XXV DESCRIPTION OF SECURITIES OUTSTANDING OR BEING OFFERED 149 Dividend, voting and preemption rights; 149 Conversion and liquidation rights; 149 Dividend policy; 149 Other rights of the securities holders; 149 CHAPTER XXVI FINANCIAL STATEMENTS Auditors report for the period 01 January to 30 June, Information as is required under section 186 of the company act 1994 relating to holding company 179 Selected ratios as specified in Annexure-D 180 Auditors report under Section 135(1), Para 24(1) of Part II of Schedule III of the Kv úvwb AvBb, The report shall include comparative income statements and balance sheet and aforementioned ratios for immediate preceding five accounting years of the issuer. If the issuer has been in commercial operation for less than five years, the above 182 mentioned inclusion and submission will have to be made for the period since commercial operation Financial spread sheet analysis for the latest audited financial statements; 184 Following statements for the last five years or any shorter period of commercial operation certified by the auditors:- Statement of long term and short term borrowings including borrowing from related party or connected persons with rate of interest and interest paid/accrued; 187 Statement of principal terms of secured loans and assets on which charge have been created against those loans with names of lenders, purpose, sanctioned amount, rate 188 of interest, primary security, collateral/other security, re-payment schedule and status; Statement of unsecured loans with terms & conditions; 189 Statement of inventories showing amount of raw material, packing material, stock-inprocess and finished goods, consumable items, store & spares parts, inventory of 190 trading goods etc.; Statement of trade receivables showing receivable from related party and connected persons; 191 Statement of any loan given by the issuer including loans to related party or connected persons with rate of interest and interest realized/accrued; 191 Statement of other income showing interest income, dividend income, discount received, other non operating income 192 Statement of turnover showing separately in cash and through banking channel; 193 Statement of related party transaction; 194 Reconciliation of business income shown in tax return with net income shown in audited financial statements; 195 Confirmation that all receipts and payments of the issuer above Tk.5,00,000/- (five lac) were made through banking channel; 196 Confirmation that Bank Statements of the issuer are in conformity with its books of 196 CHAPTER XXVII CHAPTER XXVIII accounts; Statement of payment status of tax, VAT and other taxes or duties 197 Average cost of acquisition of equity shares by the director s certified by the auditor s 198 Auditor s certificate regarding any allotment of shares to any person for any consideration otherwise than cash alongwith relationship of that person with the issuer and rationale of the issue price of the shares CREDIT RATING REPORT PUBLIC ISSUE APPLICATION PROCEDURE 210 CHAPTER XXIX OTHERS ix

11 CHAPTER I: EXECUTIVE SUMMARY: (a) About the industry Insurance serves a number of valuable functions which are very different from those rendered by other types of financial intermediaries. The indemnification and the risk pooling properties of non-life insurance facilitate transaction and the provision of credit by mitigating losses as well as the measurement and management of risk. Initially, The Insurance Industry of Bangladesh was governed by The Insurance Act, 1938 which subsequently has been replaced by the Act of The office of the Controller of Insurance under the Ministry of Commerce was abolished by the Insurance Development and Regulatory Authority Act 2010; and Insurance Development and Regulatory Authority (IDRA) is functioning under the of the Ministry of Finance (previously under the Ministry of Commerce). Through the enactment of Insurance Corporation act VI, 1973 two corporations, namely the Sadharan Bima Corporation for general insurance and the Jiban Bima Corporation for life insurance in Bangladesh were established on 14th May, The government allowed the private sector to conduct business in all areas of insurance for the first time in The insurance market now consists of 77 companies as per record in Insurance Development Regulatory Authority (IDRA), which are: (i) 02 (Two) state owned companies (Jiban Bima Corporation for life insurance, and Sadharan Bima Corporation for general insurance), (ii) (b) About the Issuer 45general insurance and32 life insurance companies in the private sector.out of which, 32 insurance companies are listed in the capital market of which 11 (eleven) are life insurance providers [source : Government has recently issued license to India s state owned-life Insurance Corporation (LIC) Established in 2013, Sonali Life Insurance Co. Ltd. was incepted in the board rooms of an organization formed thirty years ago. The vision set for Sonali Life Insurance Co. Ltd. was significant as it was necessary to create value in savings and aid in the financial needs, while insuring one s life. And thirty years later, the Board members of Rupali Insurance Co. Ltd. decided to protect and nurture the hopes and dreams of Bangladeshi families. They set out on a bold and transparent initiative to create the best life insurance company in the country, while formulating synergies using their own strengths and opportunities. In less than three years of operations, Sonali Life Insurance Co. Ltd. launched over 52 branches and service centers across the country, with BDT 180 Million paid-up capital. It utilizes the network strengths of Rupali Insurance Co. Ltd., while at the same time promoting itself using the strategic locations of the parent company. Sonali Life Insurance Co. Ltd s mission is to be the premier service provider of income solutions, investments and protection plans that are required for financial security and retirement. Together with utmost transparency and customer service orientation, it has implemented the country s first fully integrated ERP system based on life insurance which has made its operations and activities streamlined, highly productive, efficient and cost effective. In 2017 Sonali Life Insurance Co. Ltd was archived the gross premium of TAKA 407,524, with the growth rate of %. Principal products and services The products and services of the Company are as follows: Plan ID Plan Name 1 Endowment Assurance Plan With Profits 2 Anticipated Endowment Assurance Plan - 3 Stage With Profits 3 Anticipated Endowment Assurance Plan - 5 Stage With Profits 4 Ordinary Insurance Plan Without Profits 5 Money Back Term Insurance Benefit With Profit Granted 6 Child Protection Assurance Plan with Profits 7 Education Expense Assurance Plan with Profits 8 Ordinary Endowment Insurance With Profits 9 Single Premium Insurance Plan Without Profits 10 Assurance Cum Pension Plan Without Profits 11 Denmohar Bima With Profits x

12 12 Hajj Bima With Profits 13 Monthly Savings Assurance Plan With Profit 14 Monthly Savings Micro Insurance Plan With Profit (c) Financial Information (Amount in BDT) Particulars 30-Jun-2018 (6 months) For the Year ended as on 31-Dec Dec Dec Dec Dec-13 Gross Premium 280,980, ,524, ,473, ,379, ,166,865 17,547,242 Re-insurance less premium 280,357, ,720, ,658, ,963, ,945,971 17,528,775 Balance of Life Fund 381,799, ,073,934 57,496, ,272,380 80,922,292 9,865,910 Total Assets 715,899, ,871, ,959, ,008, ,657, ,287,276 Shareholders Equity 285,000, ,000, ,000, ,000, ,000, ,000,000 Number of Shares 28,500,000 18,000,000 18,000,000 18,000,000 18,000,000 18,000,000 Face Value (d) Features of the issue and its objects Face Value BDT Public Offer Price BDT10.00 Number of Shares to be Offered 19,000,000 Total Issue Size BDT Crore Issue Manager ICB Capital Management Ltd. Agrani Equity& Investment Ltd. Objectives of the Issue For investment in FDR & Treasury Bond and to meet up the IPO expense. (e) Legal and other Information Sonali Life Insurance Company Limited was incorporated on 7th July 2013 under the Companies Act 1994 as a public company limited by shares for carrying out life insurance business and was granted Certificate of Commencement of business on 7th July 2013.The Company obtained the Certificate of Registration from the Insurance Development and Regulatory Authority (IDRA) on July 30, 2013 under Insurance Act (f) Promoters background When the company was incorporated, following persons/institutions were the subscriber to the memorandum: SL. Name 1 Noor-e-Hafza 2 Fauzia Quamrun Tania 3 K.M Farookh (Nominee Of Rupali Insurance Company Limited) 4 Shafia Sobhan Chowdhury 5 Sheikh Mohammed Danial 6 Kamrun Nahar 7 Maya Rani Roy 8 Sheikh Omar Faruque 9 Omar Khayum 10 Ahmed Rajeeb Samdani 11 Mrs. Hazera Hossain 12 Mrs. Hoda Ali Selim 13 Nargis Mahmuda 14 Phowzia Khan 2

13 Brief profiles of all promoters are given below: Noor-E-Hafza,Chairperson Noor-E-Hafza is the Chairman of the company. She holds post graduate degreeon zoology from Rajshahi University. She completed diploma in Food & Nutrition from the University of Dhaka. She obtained diploma degree on art and theater from the University Of London School Of Arts. She served as personnel officer in Bangladesh Chemical Industries Corporation (BCIC). She was involved in private practice with Dr. M.Q.K Talukder as a junior consultant for 4 years. She worked as chief nutritionist in National nutrition council for 3 years. She is a of Farnoor Garments Limited for more than 30 years.. Fauzia Quamrun Tania, Vice Chairperson Fauzia Quamrun Tania is the Vice Chairman of the Company. She holds BSc Hons. as well as post graduate degree in Business Management and Mathematics from Glasgow University UK, with excellent academic track record. She is the Managing of Imperial Sweater Industries Ltd. and She is also a of Dragon Sweater Bangladesh Limited. K.M. Farookh, Rupali Insurance Company Ltd is one of the top General Insurance Company of the country. Rupali Insurance Company Limited is a of Sonali Life Insurance Company Limited which is represented by Mr. K.M Farookh, one of the s of Rupali Insurance Company Ltd. He is also the founder and Chairman of Farnoor Garments Ltd. S Mohammad Danial, Sheikh Mohammad Danial is a of the Company. After Graduation from the University of Canberra, as a young entrepreneur he has founded Mirage Agro Complex, which has expanded its operations from fresh produce exports to food grain and commodity trading. He is also a of Mirage Group, which has interest in Ready-Made-Garments, trading, and real estate. S Sobhan Chowdhury, Shafia Sobhan Chowdhury is a of the Company. After Graduating from University of Florida with top honour she has been successfully contributing towards various businesses that she is involved in. She is the of Perag Socks Industries Ltd., Dragon Sweater Bangladesh Ltd. and Dragon Sweater and Spinning Ltd. A Rajeeb Samdani, Ahmed Rajeeb Samdani is a of the Company. He is the Managing of Golden Harvest Group and the founder and trustee of Samdani Art Foundation. He is also the founding committee member of Tate Museum, United Kingdom, South Asia Acquisition Committee. He is the Secretary General of the Bangladesh Human Rights Foundation. He has started his career as a commodity broker with Stemcor. Over the years, his company, Golden Harvest has expanded its businesses into Information Technology, Commodities, Logistics, Food processing, Agriculture, Aviation business, Real Estate and Insurance business. Hazera Hossain, Mrs. Hazera Hossain is a of the Company. After graduating from AIUB, she has served in different corporate houses in Bangladesh. She was a of Famous Spinning Mills. She is also a of Hannan Desh Wear. Sheikh Omar Faruque, Sheikh Omar Faruque is a of the company. He is involved in different types of Businesses. He is a of Hotel Eram Int` Ltd and Hotel Peacock Ltd. He is a proprietor of Olio International. Omar Khayum, Omar Khayum is a of the company. After graduating from Westminister Business School, he is involved in different businesses. He is a of Hotel Eram Int` Ltd and Hotel Peacock Ltd. He is also a pr oprietor & CEO of F. R Orbit International Limited. 3

14 Kamrun Nahar, Mrs. Kamrun Nahar is a of the company. She is involved in Real Estate business. She is a of K.S.Z Propertie s Limited. Maya Rani Roy, Maya Rani Roy is a of the Company. She holds a Master of Arts Degree from Jagannath University. She served in different corporate houses. She was an Alternate of Uttara Finance & Investment Company Limited. She was a member of different voluntary welfare organizations in the country. Hoda Ali Selim, Mrs. Hoda Ali Selim is a of the Company. She holds post graduation degree from National University. She is involved in different types of business. She is a of Hotel Agrabad Limited. She is also a Managing of Intraco Ready Mix Limited. (g) Capital structure and history of capital raising Authorized Capital Particulars No. of Ordinary Shares Nominal Value in BDT Total Amount in BDT Authorized Capital 100,000, ,000,000, Paid-up Capital Date of allotment Consideration No. of Shares Face Value Amount in BDT Cash 180,000, ,000, Cash 10,500, ,000, Total 28,500,000 Ordinary each 285,000, Paid-up capital before and after the Public Issue Particulars of Paid-up Capital No. of Ordinary Shares Amount in BDT Before Initial Public Offering 28,500, ,000, Initial Public Offering under Fixed Price Method 19,000, ,000, After Initial Public Offering 47,500, ,000, (h) Summary of Valuation Report of securities DISCLOUSER Summary of valuation of Sonali Life Insurance Company Limited Sl. No. Method Used Price (amount in Tk.) Method- 1 Net Asset Value per Share based valuation (with Actuarial Valuation) Method- 2 Average Market Price of Similar stock based valuation Note: The detailed workings of the valuation under above methods are given in this prospectus under the head of Valuation Report of Securities' prepared by the Issue Manager 4

15 (i) Others Declaration by the Issue Manager This is to hereby declare that the Issue Manager ICB Capital Management Limited or any of its connected persons is in no way connected with the Issuer Sonali Life Insurance Company Limited or any of its connected person nor does hold any securities thereof. Date: 27 September, 2018 Sd/- (Md. Sohel Rahman) Chief Executive Officer (Additional Charge) ICB Capital Management Limited Agrani Equity& Investment Limited Declaration This is to hereby declared that Sonali Life Insurance Company Limited has not made any material change including raising of paid up capital after the date of audited financial statements as on June 30, 2018 as included in the prospectus. Date: 27 September, 2018 Sd/- (Ajit Chandra Aich) Managing Sonali Life Insurance Company Limited 5

16 CHAPTER- II: CONDITIONS IMPOSED BY COMMISSION DISCLOSURE IN RESPECT OF ISSUANCE OF SECURITY IN DEMATERIALIZED FORM As per provisions of the Depository Act, 1999 and regulations made there under, share of the Company, will be issued in dematerialized form only and for this purpose ofsonali Life Insurance Company Limited will sign an agreement with the Central Depository Bangladesh Limited (CDBL). Therefore, all transfers, transmissions, splitting or conversions will take place on the CDBL system and any further issuance of shares (including rights and bonus) will also be issued in dematerialized form only. CONDITIONS UNDER 2CC OF THE SECURITIES AND EXCHANGE ORDINANCE, 1969 PART A 1. The Company shall go for Initial Public Offer (IPO) for 19,000,000 ordinary shares, of these ordinary shares 50% i.e. 9,500,000 ordinary shares are reserved for Eligible Investor (EI) which includes 40% i.e. 7,600,000 ordinary shares for EI exclining Mutual Funds and CIS and 10% i.e. 1,900,000 ordinary shares for Mutual Funds and CIS and remaining 50% i.e. 9,500,000 ordinary shares for General Public including NRBat the issue price of Tk (at per) totaliing Tk. 190,000, (Taka Ninteen Croreonly) following the Securities and Exchange Ordinance, 1969, the Bangladesh Securities and Exchange Commission (Public Issue) Rules, 2015, the Depository Act, 1999 and rules made there under. 2. The abridged version of the prospectus, as approved by the Commission, shall be published by the issuer in 4 (Four) national daily newspapers (two in Bangla and two in English), within 02 (two) working days of issuance of this consent letter. The issuer shall post the full prospectus, vetted by Commission, in the issuer s website and shall also put on the websites of the Commission, stock exchanges, and the issue manager, within 03 (three) working days from the date of issuance of this letter and shall remain posted till the closure of the subscription list. The issuer shall submit to the Commission, the stock exchanges and the issue manager a diskette containing the text of the vetted prospectus in MS- Word format. 3. The company shall submit 40 (Forty) copies of the printed prospectus to the Commission for official record within 05 (Five) working days from the date of publication of the abridged version of the prospectus in the newspaper. 4. The issuer company and the issue manager shall ensure transmission of the prospectus and its abridged version for NRBs through to the Bangladesh Embassies and Missions abroad within 05 (Five) working days from the date of publication of the abridged version of the prospectus in the newspaper. A compliance report shall be submitted in this respect to the Commission jointly by the issuer and the Issue Manager within 02 (Two) working days from the date of said transmission of the prospectus. 5. The following declaration shall be made by the company in the prospectus, namely: - Declaration about Listing of Shares with the stock exchange (s): None of the stock exchange(s), if for any reason, grants listing within 75 (Seventy Five) days from the closure of subscription, any allotment in terms of this prospectus shall be void and the company shall refund the subscription money within 15 (Fifteen) days from the date of refusal for listing by the stock exchanges or from the date of expiry of the said 75 (Seventy Five) days, as the case may be. 6

17 In case of non-refund of the subscription money within the aforesaid 15 (Fifteen) days, the s of the company, in addition to the issuer company, shall be collectively and severally liable for refund of the subscription money, with interest at the rate of 2% (two percent) above the bank rate, to the subscribers concerned. The issue manager, in addition to the issuer company, shall ensure due compliance of the above mentioned conditions and shall submit compliance report thereon to the Commission within 07 (Seven) days of expiry of the aforesaid 15 (Fifteen) days time period allowed for refund of the subscription money. 6. All applicants under general public category shall apply for minimum market lot of 500 shares worth Taka 5,000.00(Taka Five Thousand only) for a market lot or its multiples. 7. The IPO shall stand cancelled in case of under-subscription in any categories above 35%. In such an event,the issuer and issue manager shall inform the Commission within 02 (two) working days and release the subscription money within 10 (ten) working days after receiving verification report from CDBL and the information from exchanges regarding subscription % of the securities for other general public shall be reserved for wzmö z`ª wewb qvmkvix. In case of over subscription in the general public category, the issuer and the issue manager shall jointly conduct an open lottery. In case of under-subscription under any of sub-categories of general public category, the undersubscribed portion shall be added to other sub-category of the same category. 9. An applicant cannot submit more than two applications, one in his/her own name and the other jointly with another person. In case, an applicant submits more than two applications, all applications will be treated as invalid and will not be considered for allotment purpose. In addition, 15% (fifteen) of the application money will be forfeited by the Commission and the balance amount will be refunded to the applicant. 10. The applicants who have applied for more than two applications using same bank account, their application will not be considered for lottery and the Commission will forfeit 15% of their subscription money. 11. Making any false statement in the application or supplying of incorrect information therein or suppressing any relevant information in the application shall make the application liable to rejection and subject to forfeiture of 25% of the application money and/or forfeiture of share (unit) before or after issuance of the same by the issuer. The said forfeited application money or share (unit) will be deposited in account of the Bangladesh Securities and Exchange Commission (BSEC). This is in addition to any other penalties as may be provided for by the law. 12. The company shall furnish the list of allotees to the Commission and the stock exchange(s) simultaneously in which the shares will be listed, within 24 (Twenty Four) hours of allotment. 13. Shares not allotted at the time of according this consent, but allotted after listing, in favor of sponsors, directors or shareholders having 10% or more shares through stock dividends, shall be subject to a lock-in period of 02 (two) years from the date of issuance of the prospectus. 14. If any share of Sponsors/s/Promoters is in paper format, it shall be handed over to securities custodian registered with the Commission and shall remain held till completion of lock-in period and the name of the securities custodian shall be furnished to the Commission jointly by the issuer and issue manager, along with a confirmation thereof from the custodian, within one week of listing of the shares with the stock exchange(s).or they (shares of Sponsors/ s/ Promoters) can be demated and shall remain in lock-in under CDBL system and issuer shall submit a dematerialization confirmation report generated by CDBL and attested by Managing of the company along with the lock-in confirmation to the Commission within one week of listing of the 7

18 shares with the stock exchange(s). In respect of shares other than Sponsors/s/Promoters the issuer will ensure their lock-in of those shares and submit a statement to this effect to the Commission % of the shares allotted to eligible investors (including Mutual Fund), shall be locked-in for 6 (six) months and other 25% of the shares allotted to them, shall be locked-in for 9 (nine) months. 16. The company shall not declare any dividend/bonus shares before listing of its securities with any exchange from the date of this consent for raising of capital. 17. The company shall not engage itself into any merger/amalgamation or acquisition activities without taking No Objection from the Commission, on the scheme of the said merger/amalgamation or acquisition, as recommended by the Board of s, before approval by the shareholders in General Meeting. Step-1 (Applicant) PART B Application Process 1. An applicant for public issue of securities shall submit application/buy instruction to the Stockbroker/ Merchant Banker where the applicant maintains customer account, within the cut-off date (i.e. the subscription closing date), which shall be the 25 th (twenty fifth) working day from thedate of publication of abridged version of prospectus. 2. The application/buy instruction may be submitted in prescribed paper or electronic form, which shall contain the Customer ID, Name, BO Account Number, Number of Securities applied for, Total Amount and Category of the Applicant. At the same time: (a) Other than non-resident Bangladeshi (NRB) and Foreign applicants shall make the application money and service charge available in respective customer account maintained with the Stockbroker/Merchant Banker. No margin facility, advance or deferred payment is permissible for this purpose. In case the application is made through a margin account, the application money shall be deposited separately and the Stockbroker/Merchant Banker shall keep the amount segregated from the margin account, which shall be refundable to the applicant, if become unsuccessful. (b) Non-resident Bangladeshi (NRB) and Foreign applicants shall submit bank drafts (FDD), issued in favor of the Issuer for an amount equivalent to the application money, with their application to the concerned Stockbroker/Merchant Banker. A Non-resident Bangladeshi (NRB) and Foreign applicant may also submit a single draft against 02(two) applications made by him/her, i.e. one in his/her own name and the other jointly with another person. The draft (FDD) shall be issued by the Bank where the applicant maintains Foreign Currency account debiting the same account and provide the customer with a certificate mentioning the FC account number which has been debited to issue the FDD. The applicant shall also submit the certificate with their application. No banker shall issue more than two drafts from any Foreign Currency account for any public issue. At the same time, the applicant shall make the service charge available in respective customer account maintained with the Stockbroker/Merchant Banker. Step-2 (Intermediary) 8

19 3. The Stockbroker/Merchant Banker shall maintain a separate bank account only for this purpose namely Public Issue Application Account. The Stockbroker/Merchant Banker shall: a) post the amount separately in the customer account (other than NRB and Foreign applicants), and upon availability of fund, block the amount equivalent to the application money; b) accumulate all the application/buy instructions received up to the cut-off date, deposit the amount in the Public Issue Application Account maintained with its bank within the first banking hour of next working day of the cut-off date; c) Instruct the banker to block the account for an amount equivalent to the aggregate application money and to issue a certificate in this regard. 4. Banker of the Stockbroker/Merchant Banker shall block the account as requested for, issue a certificate confirming the same and handover it to the respective Stockbroker/Merchant Banker. 5. For Non-resident Bangladeshi (NRB) and Foreign applicants, the Stockbroker/Merchant Banker shall preparea list containing the draft information against the respective applicant s particulars. 6. The Stockbroker/Merchant Banker shall prepare category wise lists of the applicants containing Customer ID, Name, BO Account Number and Number of Securities applied for, and within 03 (three) working days from the cut-off date, send to the respective Exchange, the lists of applicants in electronic (text format with tilde ~ separator) format, the certificate(s) issued by its banker, the drafts received from Non-resident Bangladeshi (NRB) and Foreign applicants and a copy of the list containing the draft information. 7. On the next working day, the Exchanges shall provide the Issuer with the information received from the Stockbroker/Merchant Bankers, the drafts submitted by Non-resident Bangladeshi (NRB) and Foreign applicants and the list containing the draft information. Exchanges shall verify and preserve the bankers certificates in their custody. 8. The application/buy instructions shall be preserved by the Stockbroker/Merchant Bankers up to 6 months from listing of the securities with exchange. Step-3 (Issuer) 9. The Issuer shall prepare consolidated list of the applications and send the applicants BOIDs in electronic (text) format in a CDROM to CDBL for verification. The Issuer shall post the consolidated list of applicants on its website and websites of the Exchanges. CDBL shall verify the BOIDs as to whether the BO accounts of the applicants are active or not. 10. On the next working day, CDBL shall provide the Issuer with an updated database of the applicants containing BO Account Number, Name, Addresses, Parents Name, Joint Account and Bank Account information along with the verification report. 11. After receiving verification report and information from CDBL, the Issuer shall scrutinize the applications, prepare category wise consolidated lists of valid and invalid applications and submit report of final status of subscription to the Commission and the Exchanges within 10 (ten) working days from the date of receiving information from the Exchanges. 9

20 12. The Issuer and the issue manager shall conduct category wise lottery with the valid applications within 03 (three) working days from the date of reporting to the Commission and the Exchanges, if do not receive any observation from the Commission or the Exchanges. 13. The Issuer and issue manager shall arrange posting the lottery result on their websites within 06 (six) hours and on the websites of the Commission and Exchanges within 12 (twelve) hours of lottery. 14. Within 02 (two) working days of conducting lottery, the Issuer shall: a) send category wise lists of the successful and unsuccessful applicants in electronic (text format with tilde ~ separator) format to the respective Exchange. b) send category wise lists of unsuccessful applicants who are subject to penal provisions as per conditions of the Consent Letter issued by the Commission in electronic (text format with tilde ~ separator) format to the Commission and Exchanges mentioning the penalty amount against each applicant. c) issue allotment letters in the names of successful applicants in electronic format with digital signatures and send those to respective Exchangein electronic form. d) send consolidated allotment data (BOID and number of securities) in electronic text format in a CDROM to CDBL to credit the allotted shares to the respective BO accounts. Step-4 (Intermediary) 15.On the next working day, Exchanges shall distribute the information and allotment letters to the Stockbroker/Merchant Bankers concerned in electronic format and instruct them to: a) remit the amount of successful (other than NRB and Foreign) applicants to the Issuer s respective Escrow Account opened for subscription purpose, and unblock the amount of unsuccessful applicants; b) send the penalty amount of other than NRB and Foreign applicants who are subject to penal provisions to the Issuer s respective Escrow Accounts along with a list and unblock the balance application money; 16. On the next working day of receiving the documents from the Exchanges, the Stockbrokers/Merchant Banker shall request its banker to: a) release the amount blocked for unsuccessful (other than NRB and foreign) applicants; b) remit the aggregate amount of successful applicants and the penalty amount of unsuccessful applicants (other than NRB and foreign) who are subject to penal provisions to the respective Escrow accounts of the Issuer opened for subscription purpose. 17. On the next working day of receiving request from the Stockbrokers/Merchant Bankers, their bankers shall unblock the amount blocked in the account(s) and remit the amount as requested for to the Issuer s Escrow account. 18. Simultaneously, the stockbrokers/merchant Bankers shall release the application money blocked in the customer accounts; inform the successful applicants about allotment of securities and the unsuccessful applicants about releasing their blocked amountsand send documents to the Exchange evidencing details of the remittances made to the respective Escrow accounts of the Issuer. The unblocked amounts of unsuccessful applicants shall be placed as per their instructions. The Stockbroker/Merchant Banker shall be entitled to recover the withdrawal charges, if any, from the applicant who wants to withdraw the application money, up to an amount of Tk.5.00 (five) per withdrawal. 10

21 19. All drafts submitted by NRB or Foreign applicants shall be deposited in the Issuer s respective Escrow accounts and refund shall be made by the Issuer by refund warrants through concerned stockbroker or merchant banker or transfer to the applicant s bank account (FC account which has been debited to apply by NRB or foreign applicants) through banking channel within 10 (ten) working days from the date of lottery. Miscellaneous: 20. The Issuer, Issue Manager(s), Stockbrokers and Merchant Bankers shall ensure compliance of the above. 21. The bank drafts (FDD) shall be issued considering TT Clean exchange rate of Sonali Bank Ltd. on the date of publication of abridged version of prospectus. 22. Amount deposited and blocked in the Public Issue Application Account shall not be withdrawn or transferred during the blocking period. Amount deposited by the applicants shall not be used by the Stockbrokers/Merchant Bankers for any purpose other than public issue application. 23. The Issuer shall pay the costs related to data transmission, if claimed by the Exchange concerned up to an amount of Tk.2,00, (taka two lac) for a public issue. 24. The Stockbroker/Merchant Bankers shall be entitled to a service charge of Tk.5.00 (taka five) only per application irrespective of the amount or category. The service charge shall be paid by the applicant at the time of submitting application. 25. The Stockbroker/Merchant Banker shall provide the Issuer with a statement of the remittance and drafts sent. 26. The Issuer shall accumulate the penalty amount recovered and send it to the Commission through a bank draft/payment order issued in favor of the Bangladesh Securities and Exchange Commission. 27. The concerned Exchange are authorized to settle any complaints and take necessary actions against any Stockbroker/Merchant Banker in case of violation of any provision of the public issue application process with intimation to the Commission. PART C 1. The issue manager shall carefully examine and compare the published prospectus and its abridged version on the date of publication with the copies vetted by the Commission. If any discrepancy is found, both the issuer and the issue manager shall jointly publish a corrigendum immediately in the same newspapers concerned, simultaneously endorsing copies thereof to the Commission and the stock exchanges concerned. In this regard, the issue manager shall submit a compliance report to the Commission within 5 working days from the date of such publications. 2. The fund collected through Public Offering shall not be utilized prior to listing with stock exchanges and that utilization o f the said fund shall be effected through banking channel, i.e. through account payee cheque, pay order or bank drafts etc. 3. The company shall furnish status report on utilization of Public Offering proceeds audited by foreign affiliated auditors and authenticated by the board of directors to the Commission and the exchanges within 15 (Fifteen) days of the closing of each month until such fund is fully utilized, as mentioned in the schedule contained in the prospectus. The issuer shall simultaneously post the status report in its websites of the Exchanges. In the event of any irregularity or inconsistency, the Commission may employ or engage any person, at issuer s cost, to examine whether the issuer has utilized the proceeds for the purpose disclosed in the prospectus. 4. While auditing the utilization of IPO proceeds, the auditors will perform their jobs under the following terms of reference (TOR) and confirm the same in their report/certificate: (a) Whether IPO proceeds have been utilized for the purposes/heads as specified in the prospectus; 11

22 (b) Whether IPO proceeds have been utilized in line with the condition (if any) of the Commission s consent letter; (c) Whether utilization of IPO proceeds have been completed within the time schedule/implementation schedule as specified in the published prospectus; (d) Whether utilization of IPO proceeds is accurate and for the purpose of the company as mentioned/specified in the published prospectus; and (e) The auditors should also confirm that:(i)assets have been procured/imported/constructed maintaining proper/required procedure as well as at reasonable price; and (ii) auditors report has been made on verification of all necessary documents/papers/vouchers in support of IPO proceeds making reconciliation with Bank Statement. 5. All transactions, excluding petty cash expenses, shall be effected by crossed cheques or bank transfers. 6. Proceeds of the public offering shall not be transferred to any other bank account before listing with the Exchange(s). The proceeds shall not be used for any purpose other than those specified in the prospectus without any valid ground. Any deviation in this respect must have prior approval of at least 51% of the public shareholders, other than sponsors and directors, in a general meeting. Before the said general meeting, such deviation as recommended by the board of directors shall be published as price-sensitive information with detailed description and reasons for such deviation. If approved by the shareholders, the meeting resolution shall be submitted to the Commission a long with reasonable explanations for approval. After such approval, such decision shall be published as price-sensitive information. 7. If any quarter or half-year of the financial year ends after publication of the abridged version of prospectus and before listing of its securities with any exchange, the company shall disseminate/transmit/submit the said quarterly/half yearly financial statements in accordance with the Commission s Notification SEC/CMRRCD/ /admin/03-34 dated September 27, 2009 and Rules 13 of the Securities and Exchange Rules, In the event of arising issues concerning Price Sensitive Information as defined under the wmwkdwiwur I G PÄ Kwgkb (myweav fvmx e emv wbwl KiY) wewagvjv 1995 after publication of the abridged version of prospectus and before listing of its securities with any exchange, the company shall disseminate/transmit/submit the information as price sensitive in accordance with the Commission s Notification No. SEC/SRMI/ /1950 dated October 24, PART D 1. As per provision of the Depository Act, 1999 & regulations made there under, shares will only be issued in dematerialized condition. All transfer/transmission/splitting will take place in the Central Depository Bangladesh Ltd. (CDBL) system and any further issuance of shares (Including rights/bonus) will be made in dematerialized form only. 2. The issuer and the issue manager shall ensure due compliance of all the above conditions, the Bangladesh Securities and Exchange Commission (Public Issue) Rules, 2015 and the listing regulations of the exchanges. 3. The Commission may impose further conditions/restrictions etc. from time to time as and when considered necessary which shall also be binding upon the issuer company. CHAPTER- III: DECLARATION AND DUE DILIGENCE CERTIFICATES AS PER ANNEXURE(S)- A, B AND C Declaration about the responsibility of the s including the Managing of the Sonali Life Insurance Company Limited in respect of theprospectus 12

23 [Rule 4 (1) (d)] This Prospectus has been prepared, seen and approved by us, and we, individually and collectively, accept full responsibility for the authenticity, accuracy and adequacy of the statements made, information given in the Prospectus, Documents, Financial Statements, Exhibits, Annexes, Papers submitted to the Commission in support thereof, and confirm, after making all reasonable inquiries that all conditions concerning this Public Issue and Prospectus have been met and that there are no other information or documents the omission of which make any information or statements therein misleading for which the Commission may take any civil, criminal or administrative action against any or all of us as it may deem fit. We also confirm that full and fair disclosures have been made in this Prospectus to enable the investors to make a wellinformed decision for investment. Sd/- Mrs. Noor-e-Hafza Chairman Sd/- Mrs.Fauzia Quamrun Tania Vice chairman Sd/- K. M. Farookh Nominee of Rupali Insurance Company Ltd. Sd/- Mrs. Shafia Sobhan Chowdhury Sd/- Mr. Sheikh Mohammed Danial Sd/- Mrs. Kamrun Nahar Sd/- Mrs. Maya Rani Roy Sd/- Mr. Sheikh Omar Faruque Sd/- Mr. Omar Khayum Sd/- Mr. Ahmed Rajeeb Samdani Sd/- Mrs. Hazera Hossain Sd/- Mrs. Hoda Ali Selim Sd/- Honufa Akter Rikta Independent Sd/- Quazi Moniruzzaman Independent Sd/- Md. Nurun Nabi Independent Sd/- Ajit Chandra Aich Managing Due diligence certificate furnished by issue manager To The Bangladesh Securities and Exchange Commission Sub: Public offer of 19,000,000 Ordinary Shares of Tk. 190,000, by Sonali Life Insurance Company Limited 13

24 Dear Sir, We, the issue manager to the above-mentioned forthcoming issue, state and confirm as follows: (1) We have examined all the documents submitted with the application for the above mentioned public issue, visited the premises of the issuer and interviewed the Chairperson, s and key management personnel of the issuer in connection with the finalization of the Prospectus pertaining to the said issue; (2) On the basis of such examination and the discussions with the directors, officers and auditors of the issuer, other agencies, independent verification of the statements concerning objects of the issue and the contents of the documents and other materials furnished by the issuer. WE CONFIRM THAT: (a) The Prospectus filed with the Commission is in conformity with the documents, materials and papers relevant to the issue; (b) All the legal requirements relating to the issue as also in the rules, notification, guidelines, instructions, etc. framed/issued by the Commission, other competent authorities in this behalf and the Government have been duly complied with; (c) The disclosures made in prospectus are true, fair and adequate to enable the investors to make a well informed decision for investment in the proposed issue and such disclosures are in accordance with the requirements of the Companies Act, 1994, the Bangladesh Securities and Exchange Commission (Public Issue) Rules, 2015 and other applicable laws; (d) Besides ourselves, all the intermediaries named in the prospectus are registered with the Commission and that till date such registrations are valid; (e) We have satisfied ourselves about the capability of the underwriters to fulfill their underwriting commitments; (f) The proposed activities of the issuer for which the funds are being raised in the present issue fall within the main objects listed in the object clause of the Memorandum of Association or other charter of the issuer and that the activities which have been carried out till now are valid in terms of the object clause of its Memorandum of Association; (g) Necessary arrangements have been made to ensure that the moneys to be received pursuant to the issue shall be kept in a separate bank account and shall be used for the purposes disclosed in the use of proceeds section of the Prospectus; (h) All the applicable disclosures mandated in the Bangladesh Securities and Exchange Commission (Public Issue) Rules, 2015 have been made in addition to other disclosures which, in our view, are fair and adequate to enable the investor to make a well informed decision; (i) (j) We enclose a note explaining how the process of due diligence has been exercised by us in view of the nature of current business background or the issuer, situation at which the proposed business stands, the risk factors, sponsors experiences etc. We also confirm that the due diligence related process, documents and approval memos shall be kept in record by us for the next 5 (five) years after the IPO for any further inspection by the Commission; We enclose a checklist confirming rule-wise compliance with the applicable provisions of the Bangladesh Securities and Exchange Commission (Public Issue) Rules, 2015 containing details such as the rule number, its text, the status of compliance, page numbers of the Prospectus where the rules has been complied with and our comments, if any; 14

25 (k) We also declare that we have managed the public issue of following issuers in the last 05 (five) years: Sl. Issue Month/Year (July to June) Issue FY Issue Price Orion Pharma Limited Bengal Windsor Thermoplastics Limited Apollo Ispat Complex Limited Shurwid Industries Limited Saif Powertec Limited Western Marin Shipyard Limited National Feed Mills Limited Hamid Fabrics Limited The ACME Laboratories Limited Doreen Power Generations and Systems Limited Dividend Payment History %C %C %C, %C, %C, 20% B %B %C %B, %C, %C, 8%B, %B %C, 10%B %C, 12%B, %B No Dividend %B %C,28%B %C, 27%B, %B, %B %B %C, 12%B %B %B %C, 10%B %B %B %B %C %C, 5%B, %C, 10%B %C %C %C %C %C,10%B %C, 20%B 5 BBS Cables Limited %C,15%B 6 Aman Cotton Fibarous Limited N/A For Manager to the Issue Dhaka, Date: 01October,2018 sd/- (Md. Sohel Rahman) Chief Executive Officer (Additional Charge) ICB Capital Management Limited 15

26 Due diligence certificate furnished by issue manager To The Bangladesh Securities and Exchange Commission Sub: Public offer of 19,000,000 Ordinary Shares of Tk. 190,000, by Sonali Life Insurance Company Limited Dear Sir, We, the issue manager to the above-mentioned forthcoming issue, state and confirm as follows: (3) We have examined all the documents submitted with the application for the above mentioned public issue, visited the premises of the issuer and interviewed the Chairperson, s and key management personnel of the issuer in connection with the finalization of the Prospectus pertaining to the said issue; (4) On the basis of such examination and the discussions with the directors, officers and auditors of the issuer, other agencies, independent verification of the statements concerning objects of the issue and the contents of the documents and other materials furnished by the issuer. WE CONFIRM THAT: (l) The Prospectus filed with the Commission is in conformity with the documents, materials and papers relevant to the issue; (m) All the legal requirements relating to the issue as also in the rules, notification, guidelines, instructions, etc. framed/issued by the Commission, other competent authorities in this behalf and the Government have been duly complied with; (n) The disclosures made in prospectus are true, fair and adequate to enable the investors to make a we ll informed decision for investment in the proposed issue and such disclosures are in accordance with the requirements of the Companies Act, 1994, the Bangladesh Securities and Exchange Commission (Public Issue) Rules, 2015 and other applicable laws; (o) Besides ourselves, all the intermediaries named in the prospectus are registered with the Commission and that till date such registrations are valid; (p) We have satisfied ourselves about the capability of the underwriters to fulfill their underwriting commitments; (q) The proposed activities of the issuer for which the funds are being raised in the present issue fall within the main objects listed in the object clause of the Memorandum of Association or other charter of the issuer and that the activities which have been carried out till now are valid in terms of the object clause of its Memorandum of Association; (r) Necessary arrangements have been made to ensure that the moneys to be received pursuant to the issue shall be kept in a separate bank account and shall be used for the purposes disclosed in the use of proceeds section of the Prospectus; (s) All the applicable disclosures mandated in the Bangladesh Securities and Exchange Commission (Public Issue) Rules, 2015 have been made in addition to other disclosures which, in our view, are fair and adequate to enable the investor to make a well informed decision; (t) We enclose a note explaining how the process of due diligence has been exercised by us in view of the nature of current business background or the issuer, situation at which the proposed business stands, the risk factors, sponsors experiences etc. We also confirm that the due diligence related process, documents and approval memos shall be kept in record by us for the next 5 (five) years after the IPO for any further inspection by the Commission; (u) We enclose a checklist confirming rule-wise compliance with the applicable provisions of the Bangladesh Securities and Exchange Commission (Public Issue) Rules, 2015 containing details such as the rule number, its text, the status of compliance, page numbers of the Prospectus where the rules has been complied with and our comments, if any; 16

27 (v) We also declare that we have managed the public issue of following issuers in the last 05 (five) years: Sl. Issue Month/Year (July to June) Issue FY Issue Price Dividend Payment History 1 N/A For Manager to the Issue Dhaka, Date: October 01,2018 Ahmed Yousuf Abbas Chief Executive Officer Agrani Equity -& Investment Limited Due diligence certificate by the underwriter(s) [See rule 4 (1)(d)] To The Bangladesh Securities and Exchange Commission Sub: Public offer of 19,000,000Ordinary Shares of BDT. 190,000,000.00ofSonali Life Insurance Company Limited. Dear Sir, We, the under-noted Underwriter(s) to the above-mentioned forthcoming issue, state individually and collectively as follows: (1) We, while underwriting the above mentioned issue on a firm commitment basis, have examined the draft prospectus, other documents and materials as relevant to our underwriting decision; and (2) On the basis of such examination and the discussions with the issuer company, its directors and officers, and other agencies, independent verification of the statements concerning objects of the issue and the contents of the documents and other materials furnished by the issuer company. WE CONFIRM THAT: (a) We are registered with the Bangladesh Securities and Exchange Commission as a merchant banker and eligible to carry out the underwriting activities. Our present paid-up capital stands at Tk (Three hundred twenty nine point sixty five) crore and we have the capacity to underwrite a total amount of Tk. 2, (Taka two thousand two hundred seven point three zero) crore as per relevant legal requirements. We have committed to underwrite for up to Tk (six point sixty five) crore for the upcoming issue. 17

28 (b) At present, the following underwriting obligations are pending for us: Sl. No. Name of the Company Amount Underwritten (in Tk.) 1 STS Holdings Limited 60,900, Delta Hospital Limited 16,000, ADN Telecom Limited 199,500, Desh General Insurance Company Ltd. 5,600, Energypac Power Generation Ltd. 42,500, Ratanpur Steel Re-Rolling Mills Ltd. 37,500, AB Bank Limited 750,000, Mohammed Elias Brothers POY Manufacturing Limited 10,000, Star Ceramics Limited 62,500, Modern Steel Mills Limited 150,000, Dragon Sweater and Spinning Limited 381,666, egeneration Limited 20,000, Esquire Knit Composite Limited 40,000, Mir Akhter Hossain Limited 20,000, Total= 1,796,166, (c) All information as are relevant to our underwriting decision have been received by us and the draft prospectus forwarded to the Commission has been approved by us; (d) We shall subscribe and take up the un-subscribed securities against the above-mentioned public issue within 15 (fifteen) days of calling up thereof by the issuer; and (e) This underwriting commitment is unequivocal and irrevocable. For the Underwriter: sd/- (Md. Sohel Rahman) Chief Executive Officer (Additional Charge) Date: 01 October,

29 CHAPTER-IV: ABOUT THE ISSUER: (a) Name of the issuer, dates of incorporation and commencement of its commercial operations, its logo, addresses of its registered office, other offices, telephone number, fax number, contact person, website address and address Corporate and Branch Name of the Issuer : Sonali Life Insurance Company Limited Date of Incorporation as a Private Limited Company Date of Commencement of Commercial Operation The Logo of the Issuer Addresses of Registered Office Extended office Head : 07 July 2013 : 01 August, 2013 : : Rupali Bima Bhaban, 7 RAJUK Avenue, Dhaka : 68/B DIT Road, Malibagh Chowdhury Para, Dhaka branches Description (with Branch Code & Project type Location 1 - Motijheel (Metro) 7 Rajuk Avenue Rupali Bima Bhaban, Motijheel Dhaka 2 - Malibagh 68/B DIT Road Chowdhury Para, Malibagh Dhaka 3 Bakulia Sonar Modina Tower, 4 th Floor, Kala Mia Bazar, Bisho Road Tower, Eest Bakalia,Near Anonto Bilash clab, Chittagong. 18 Comilla Nahar Plaza 67/58 Nazrul Avenue (4 th floor) 2 nd Kandipar Comilla. 21 Rajshahi 110 no. Karim Super Market (3 rd floor), P.O: Ghoramara, P.S: Bowaliya, Dist: Rajshahi Agrabad (Metro) Agrabad Center (7th Floor) 2470/A S.K. Mujib Road Agrabad, Chittagong. Branch : 27 - Sugandha House 170 (2nd Floor) Block - D Road No -2, Sugandha Residential Area Panchlaish, Chittagong 39 - Meah Bazar Carnival (2nd Floor) P.O : Meah Bazar P.S: Chauddagram Dist: Comilla Mirza Pur Baima Hati, P.O.+ P.S : MirzaPur, Dist :Tangail Chandanaish Hazi Shiraj Market (1st floor), boiltoli, Chandanaish, Chittagong Kasba (Metro) Simanta Complex-2, 2nd Floor, Kasba Puratan Bazar, Kasba, B-Baria Bonpara Shohid Dr. Aynul Hoque Pourashava Super Market (3rd Floor), P.o :Harara P.O: Boraigram, Dist: Nator Feni (Metro) Aziz Shopping Center (4th Floor), 189, S.S.K.Road, Feni Laxmipur Vill : Shomserabad, P.O : Laxmipur, P.S: Laxmipur Sadar, Dist : Laxmipur Raozan Vill : Sultanpur P.O + P.S : Raozan, Dist : Chittagong Netrokona 180/1, Shahor Satpai, P.O.+ P.S. + Dist : Netrokona 19

30 158 - Norshingdi (Takaful) Vill ; Srishtighor (Bus Stand Bazar) P.O : Chaitanya, P.S : Shibpur, Dist : Norshingdi Rangpur (Metro) House No -286 Gupto para Station Road Rangpur sadar, Rangpur Akborshah (Takaful) Sandip Town (Takaful) Block I, Koibollodham R/A, Ferozshah, Akborshah, Chittagong VIll : Haramia, P.O: Bokterhat P.S: Sondhip, Dist: Chittagong Comilla (Metro) Nahar Plaza 67/58 Nazrul Avenue (8 th floor) 2 nd Kandipar Comilla Shibpur Bazar Jongi Shibpur Bazar Vill: Hosen Nogar P.O: Hosen Nogar P.S: Raypura Dist: Norshingdi Tangail House no Kodalia (1st Floor), P.O. : 1900 P.S : + Dist : Tangail Sandip Akborhat (Takaful) Sondhip Shiberhat (Takaful) Bhuschi Bazar (Laksam) Vill: Gasuya P.O: Gasuya P.S: Sandip, Dist: Chittagong. Amir Hazer Bari, mait Vanga, shiberhat, Sondhip, Chittagong. Vill: Bhuschi Bazar, P.O: Choto Sharitpur-3573, P.S: Sadar Dakshin Dist: Comilla Chittagong (Metro) Chowdhury Center (3rd Floor),225/ A, C D A Avinew, Muradpur, Chittagong Cox's Bazar (Metro) Main Road, Bazarghata, Coxs Bazar Chokoria (Metro) Abdul Motlob Shopping Complex (2nd Floor), Chiringa, Chakaria, Cox'sbaza Bhola Habib Super Market: (4th Floor) Mohajon Potti sadar Road Bhola Pekuya (Metro) Mowlana Jahangir Alam Market, P.O : Pekuya, Chowmohoni, Dist : Coxs Bazar Sylhet (Metro) West World Sopping City (8th Floor) Zollarpar Road, Zindabazar,Sylhet Wasa (Metro) Thakurgaon (Metro) Maheshkhali (Metro) M.B Complex (3rd floor) Holding No -90,High Seven Road,Lalkhan Bazar P.O:-Dam para P.S.Khulshi Dist : Chittagong Holding no-512naresh Chanhan road Thakurgaon Sadar P S + Dist : Thakurgaon Vill: Gorakgata Ekram Building P.O : Gorakgata P.S.:Maheshkhali Dist : Cox'sBazar B -Baria (Metro) F.C Tower (3th Floor), Court Road, Brahmanbaria Monohorgonj Bazar Monohorgonj Bazar P.O + P.S :Monohorgonj, Dist: Comilla Barisal (Metro) 109 Sadar Road (4th Floor) P.O. : Barisal Sadar P.S : Kotwali Model Dist : Barisal Laldighi (Metro Gazi Tower (2nd Floor) 47 Laldighi, P.O ; Sada P.S : Kotowali Dist : Chittagong Pirojpur (Metro) Vill : Charakhali P.O. + P.S : Indurkani Dist : Pirojpur Keranihat (Metro) Vill + P.O. : Keranihat, P.S.: Satkania Dist : Chittagong Hathazari (Metro) 1049,Hathazari City Corporation (3rd floor) P.O. + P.S : Hathazari Dist : Chittagong Taraganj (Metro) Paschim Kursha Dorjipara P.O + P.S :Taraganj Dist: Dinajpur Dagonbhuya (Metro) Cox's Bazar Agency (Metro) 74, "Al - Nur Jame Moszid " Market (3rd Floor) Chowmuhani Road, P.O + P.S: Dagonbhuiyan Dist : Feni. 58, "Al Aksa Shoping Tower Market (2nd Floor) P.O: Chiringa P.S: Chokoria Dist: Cox's bazar Kurigram (Metro) Vill : Goshpara P.O + P.S: Kurigram Sadar Dist : Kurigram Mirpur (Metro) Fair Plaza Plot -C/3 Block -D Road no - 1 P.S.; Shahoali Mirpur -1,Dist : Dhaka Panchagarh (Metro) Holding no- 626 Kayatpara P.O: Panchagarh P.S : Panchagarh Sadar Dist: Panchagarh 20

31 294 - Fulgazi (Metro) 492, Fulgazi Trade Center ( 2nd Floor) Main Road P.O + P.S : Fulgazi Dist : Feni Jhenaidah (Metro) Kanchpur (Metro) House no - 48 Sher -E - Bangla Sarak, P.O. + P.S : Jhenaidah Sada, Dist:Jhenaidah. Senpara Jame Mosjid Shopping Complex (2nd Floor), P.O : Kanchpur, P.S : Sonargaon, Dist : Narayanganj, Kendua Vill : Coat road P.O +P.S : Kendua Dist : Netrokona Phone: , Telephone and Fax : IP Phone: number Fax: Contact Person : Ajit Chandra Aich, Managing Drector Website and Address : info@sonalilife.com (b) The names of the sponsors and directors of the issuer; Sponsors of the company s of the Company SL No Name 1 Mrs. Noor-E-Hafza 2 Mrs. Fauzia Quamrun Tania 3 K.M Farookh (Nominee Of Rupali Insurance Company Limited) 4 Mrs. Shafia Sobhan Chowdhury 5 Mr. Sheikh Mohammed Danial 6 Mrs. Kamrun Nahar 7 Mrs. Maya Rani Roy 8 Mr. Sheikh Omar Faruque 9 Mr. Omar Khayam 10 Mr. Ahmed Rajeeb Samdani 11 Mrs. Hazera Hossain 12 Mrs. Hoda Ali Selim 13 Mrs. Nargis Mahmuda 14 Ms. Phowzia Khan SL. NO Name Position 01 Mrs. Noor-E-Hafza Chairman 02 Mrs. Fauzia Quamrun Tania Vice-Chairman 03 K.M Farookh (Nominee Of Rupali Insurance Company Limited) 04 Mrs. Shafia Sobhan Chowdhury 05 Mr. Sheikh Mohammed Danial 06 Mrs. Kamrun Nahar 07 Mrs. Maya Rani Roy 08 Mr. Sheikh Omar Faruque 09 Mr. Omar Khayam 10 Mr. Ahmed Rajeeb Samdani 11 Mrs. Hazera Hossain 12 Mrs. Hoda Ali Selim 13 Honufa Akter Rikta Independent 14 Quazi Moniruzzaman Independent 15 Md. Nurun Nabi Independent **The independent directors were appointed on the 5th AGM of the company held on 27 September,

32 (c) The name, logo and address of the auditors of the issue, along with their telephone numbers, fax numbers, contact persons, website and addresses Auditor: Particulars Description Name : Ahmad& Akhtar : Logo Address : BCIC Bhaban(3 rd floor),30-31,dilkusha,c/a,dhaka-1000 Telephone Number : Fax Number : FAX: Contact Person : Mohammed Naser Chief Executivee Officer Website Address : Address : aacano120@gmail.com Register to the Issue: Information regarding the Register to the Issue is not applicable for SLICL. Acturial information Particulars Description Name : Z. Halim & Associates Logo : Address : Empori Parkview Flat 9A, House 1/C,Road 86, North Gulshan, Dhaka Telephone Number : (+88) Fax Number : N/A Contact Person : Zafar Halim Website Address : Address : ceo@zhalim.com (d) The name(s) of the stock exchanges where the specified securities are proposed to be listed SL # Name of the Exchange Logo Address 1 Dhaka Stock Exchange Limited (DSE) 9/F, Motijheel C/A, Dhaka Chittagong Stock Exchange Limited (CSE) CSE Building, 1080 Sheikh Mujib Road, Chittagong. 22

33 CHAPTER V: CORPORATE DIRECTORY OF THE ISSUER: Corporate y of the Issuer Name of the Issuer : Sonali Life Insurance Company Limited Date of Incorporation as a Private Limited Company : 07 July,2013 Date of Commencement of Commercial Operation : 01 August, 2013 Authorized Capital : Tk. 1,000,000, Issued, Subscribed & Paid-up Capital : Tk. 285,000, Addresses of the Registered Office : Rupali Bima Bhaban,7 RAJUK Avenue, Dhaka Extended Head Office 68/B D.I.T. Road,Malibagh ChowdhuryPara, Dhaka-1219 Branch 52 no. of branches all over in Bangladesh Board of s : 15 s (including Three Independen s) Auditor : Ahmad & Akhtar BCIC Bhaban(3rd floor), 30-31,Dilkusha,C/A, Dhaka-1000 Acturial Valuer : Zafar Halim Actuary Empori Parkview Flat 9A, House 1/C, Road 86, North Gulshan, Dhaka (+88) Legal Advisor : Imtiaz Moinul Islam LegalShelter, Appollo Ispat Complex, 407, Tejgaon Industrial Area, Dhaka. Tax Consultant : A. Hossain & Company Chartered Accountants Paramount Height 65/2/1 Box Culvert Road PuranaPaltan, Dhaka-1000 ICB Capital Management Ltd. Green City Edge (5 th & 6 th Floor) 89, Kakrail, Dhaka-1000 Managers to the Issue : Compliance Officer : Telephone and Fax number : Website and Address : Banker for IPO : Agrani Equity& Investment Limited Swantex bhaban (4 th floor) 9/1, Motijheel C/A, Dhaka Md.Rafe-Uz-Zaman Company Secretary IP Phone: Fax: info@sonalilife.com South Bangla Agricultureand Commerce Bank Limited Principal Branch, 47, Dilkusha, Motijheel, Dhaka All investors are hereby informed by the Company that the Company Secretary would be designated as Compliance Officer who will monitor the compliance of the Acts, Rules, Regulations, Notifications, Guidelines, Conditions, Orders/Directions issued by the Commission and/or Stock Exchange(s) applicable to the conduct of the business activities of the Company, so as to promote the interest of the investors in the security issued by the Company, and for redressing investors grievances. 23

34 CHAPTER VI: DESCRIPTION OF THE ISSUER: (a) Summary of the Industry (i) Insurance serves a number of valuable functions which are very different from those rendered by other types of financial intermediaries. The indemnification and the risk pooling properties of non-life insurance facilitate transaction and the provision of credit by mitigating losses as well as the measurement and management of risk. Initially, The Insurance Industry of Bangladesh was governed by The Insurance Act 1938 which subsequently has been replaced by the Act of The office of the Controller of Insurance under the Ministry of Commerce was abolished by the Insurance Development and Regulatory Authority Act 2010; and Insurance Development and Regulatory Authority (IDRA) is functioning under the of the Ministry of Finance (previously under the Ministry of Commerce). Through the enactment of Insurance Corporation act VI, 1973 two corporations, namely the Sadharan Bima Corporation for general insurance and the Jiban Bima Corporation for life insurance in Bangladesh were established on 14th May, The government allowed the private sector to conduct business in all areas of insurance for the first time in The insurance market now consists of 77 companies as per record in Insurance Development Regulatory Authority (IDRA), which are: 02 (Two) state owned companies (Jiban Bima Corporation for life insurance, and Sadharan Bima Corporation for general insurance), and 45 general insurance and 32 life insurance companies in the private sector.out of which, 32 insurance companies are listed in the capital market of which 11 (eleven) are life insurance providers [source: Government has recently issued license to India s state owned-life Insurance Corporation (LIC). Business environment of the Issuer The competitive environment in the insurance industry in Bangladesh is quite complex. There are 29 private, 1 nationalized and 2 foreign life insurance companies, having extensive branch networks, holding huge premium deposit and enjoying certain prerogatives. There are the third generation private sector insurance company having comparative large branch networks, reasonable access to technology and market. Therefore, competition is increasing day by day. Although there is much competition in the insurance sector, the Sonali Life Insurance Company Ltd. has earned a notable position in this market through its performance, reliabilities, efficient management, experience and acceptance by its clients. (i) Summary of consolidated financial, operating and other information SLICL has no subsidiary or associate companies. Hence, summary of consolidated financial, operating and other information is not applicable. (b) General Information (j) Name and address, telephone and fax numbers of the registered office, corporate head office, other offices, factory, business premises and branches of the Issuer are as follows: Registered Office : Corporate Head Office Branch : : Rupali Bima Bhaban, 7 RAJUK Avenue, Dhaka IP Phone: Fax: /B D.I.T. Road,Malibagh Chowdhury Para, Dhaka IP Phone: Fax: Description (with Branch Code & Project type Location 1 - Motijheel (Metro) 7 Rajuk Avenue Rupali Bima Bhaban, Motijheel Dhaka 2 - Malibagh 68/B DIT Road Chowdhury Para, Malibagh Dhaka 3 Bakulia Sonar Modina Tower, 4 th Floor, Kala Mia Bazar, Bisho Road Tower, Eest Bakalia,Near Anonto Bilash clab, Chittagong. 24

35 18 Comilla Nahar Plaza 67/58 Nazrul Avenue (4 th floor) 2 nd Kandipar Comilla. 21 Rajshahi 110 no. Karim Super Market (3 rd floor), P.O: Ghoramara, P.S: Bowaliya, Dist: Rajshahi Agrabad (Metro) Agrabad Center (7th Floor) 2470/A S.K. Mujib Road Agrabad, Chittagong Sugandha House 170 (2nd Floor) Block - D Road No -2, Sugandha Residential Area Panchlaish, Chittagong 39 - Meah Bazar Carnival (2nd Floor) P.O : Meah Bazar P.S: Chauddagram Dist: Comilla Mirza Pur Baima Hati, P.O.+ P.S : MirzaPur, Dist :Tangail Chandanaish Hazi Shiraj Market (1st floor), boiltoli, Chandanaish, Chittagong Kasba (Metro) Simanta Complex-2, 2nd Floor, Kasba Puratan Bazar, Kasba, B-Baria Bonpara Shohid Dr. Aynul Hoque Pourashava Super Market (3rd Floor), P.o :Harara P.O: Boraigram, Dist: Nator Feni (Metro) Aziz Shopping Center (4th Floor), 189, S.S.K.Road, Feni Laxmipur Vill : Shomserabad, P.O : Laxmipur, P.S: Laxmipur Sadar, Dist : Laxmipur Raozan Vill : Sultanpur P.O + P.S : Raozan, Dist : Chittagong Netrokona 180/1, Shahor Satpai, P.O.+ P.S. + Dist : Netrokona Norshingdi (Takaful) Vill ; Srishtighor (Bus Stand Bazar) P.O : Chaitanya, P.S : Shibpur, Dist : Norshingdi Rangpur (Metro) House No -286 Gupto para Station Road Rangpur sadar, Rangpur Akborshah (Takaful) Block I, Koibollodham R/A, Ferozshah, Akborshah, Chittagong Sandip Town (Takaful) VIll : Haramia, P.O: Bokterhat P.S: Sondhip, Dist: Chittagong Comilla (Metro) Nahar Plaza 67/58 Nazrul Avenue (8 th floor) 2 nd Kandipar Comilla Shibpur Bazar Jongi Shibpur Bazar Vill: Hosen Nogar P.O: Hosen Nogar P.S: Raypura Dist: Norshingdi Tangail House no Kodalia (1st Floor), P.O. : 1900 P.S : + Dist : Tangail Sandip Akborhat (Takaful) Vill: Gasuya P.O: Gasuya P.S: Sandip, Dist: Chittagong Sondhip Shiberhat (Takaful) Amir Hazer Bari, mait Vanga, shiberhat, Sondhip, Chittagong Bhuschi Bazar (Laksam) Vill: Bhuschi Bazar, P.O: Choto Sharitpur-3573, P.S: Sadar Dakshin Dist: Comilla Chittagong (Metro) Chowdhury Center (3rd Floor),225/ A, C D A Avinew, Muradpur, Chittagong Cox's Bazar (Metro) Main Road, Bazarghata, Coxs Bazar Chokoria (Metro) Abdul Motlob Shopping Complex (2nd Floor), Chiringa, Chakaria, Cox'sbaza Bhola Habib Super Market: (4th Floor) Mohajon Potti sadar Road Bhola Pekuya (Metro) Mowlana Jahangir Alam Market, P.O : Pekuya, Chowmohoni, Dist : Coxs Bazar Sylhet (Metro) West World Sopping City (8th Floor) Zollarpar Road, Zindabazar,Sylhet Wasa (Metro) M.B Complex (3rd floor) Holding No -90,High Seven Road,Lalkhan Bazar P.O:-Dam para P.S.Khulshi Dist : Chittagong Thakurgaon (Metro) Holding no-512naresh Chanhan road Thakurgaon Sadar P S + Dist : Thakurgaon Maheshkhali (Metro) Vill: Gorakgata Ekram Building P.O : Gorakgata P.S.:Maheshkhali Dist : Cox'sBazar B -Baria (Metro) F.C Tower (3th Floor), Court Road, Brahmanbaria Monohorgonj Bazar Monohorgonj Bazar P.O + P.S :Monohorgonj, Dist: Comilla Barisal (Metro) 109 Sadar Road (4th Floor) P.O. : Barisal Sadar P.S : Kotwali Model Dist : Barisal Laldighi (Metro Gazi Tower (2nd Floor) 47 Laldighi, P.O ; Sada P.S : Kotowali Dist : Chittagong Pirojpur (Metro) Vill : Charakhali P.O. + P.S : Indurkani Dist : Pirojpur Keranihat (Metro) Vill + P.O. : Keranihat, P.S.: Satkania Dist : Chittagong Hathazari (Metro) 1049,Hathazari City Corporation (3rd floor) P.O. + P.S : Hathazari Dist : Chittagong Taraganj (Metro) Paschim Kursha Dorjipara P.O + P.S :Taraganj Dist: Dinajpur Dagonbhuya (Metro) 74, "Al - Nur Jame Moszid " Market (3rd Floor) Chowmuhani Road, P.O + P.S: Dagonbhuiyan Dist : Feni Cox's Bazar Agency (Metro) 58, "Al Aksa Shoping Tower Market (2nd Floor) P.O: Chiringa P.S: Chokoria Dist: Cox's bazar Kurigram (Metro) Vill : Goshpara P.O + P.S: Kurigram Sadar Dist : Kurigram Other offices/business premises and outlets Mirpur (Metro) Fair Plaza Plot -C/3 Block -D Road no - 1 P.S.; Shahoali Mirpur -1,Dist : Dhaka Panchagarh (Metro) Holding no- 626 Kayatpara P.O: Panchagarh P.S : Panchagarh Sadar Dist: Panchagarh Fulgazi (Metro) 492, Fulgazi Trade Center ( 2nd Floor) Main Road P.O + P.S : Fulgazi Dist : Feni Jhenaidah (Metro) House no - 48 Sher -E - Bangla Sarak, P.O. + P.S : Jhenaidah Sada, Dist:Jhenaidah Kanchpur (Metro) Senpara Jame Mosjid Shopping Complex (2nd Floor), P.O : Kanchpur, P.S : Sonargaon, Dist : Narayanganj, Kendua Vill : Coat road P.O +P.S : Kendua Dist : Netrokona : We have no other offices/business premises and outlets. 25

36 (ii) The Board of s of the Issuer Sl. No. Name of Position 1. Mrs. Noor-E-Hafza Chairman 2. Mrs. Fauzia Qumrun Tania Vice-Chairman 3. K.M Farookh (Nominee Of Rupali Insurance Company Limited) 4. Mr. Sheikh Mohammed Danial 5. Mrs. Shafia Sobhan Chowdhury 6. Mrs. Kamrun Nahar 7. Mrs. Maya Rani Roy 8. Mr. Sheikh Omar Faruque 9. Mr.Omar Khayum 10. Mr. Ahmed Rajeeb Samdani 11. Mrs. Hazera Hossain 12. Mrs. Hoda Ali Selim 13. Hanufa Akter Rikta Independent director 14. Quazi Moniruzzaman Independent director 15. Md. Nurun Nabi Independent (iii) Names, addresses, telephone numbers, fax numbers and addresses of the Chairman, Managing, whole time s, etc. of the Issuer: Sl No. Name Position Address 1 Mrs. Noor-e-Hafza Chairman 2 Mrs. Fauzia Quamran Tania 3 K.M. Farookh (Nominee of Rupali Insurance Co. Ltd.) Vice- Chairman 4 Mrs. Shafia Sobhan Chodhury 5 Mr. Sheikh Mohammed Danial 6 Mrs. Kamrun Nahar 7 Mrs. Maya Rani Roy 8 Mr. Sheikh Omar Faruque 9 Mr. Omar Khayum Dream Castle, House- 7, Road- 4, Gulshan-1, Dhaka House- 2/3, Road- 03, Banani, Dhaka , Rajuk Avenue, Motijheel C/A, Dhaka House- 69, Road- 7, Block- F, Banani, Dhaka. House- 4, Road- 6, Khulshi, Chittagong. House- 808, Road- 24, Block- F, Bashundhara, Dhaka. House- 67, Road- 07, Block- F, Banani, Dhaka Vill: South Hangla, Sultanpur, Brahmanbaria. My Hart, Sukrabad, House- 8/1, Sukrabad, Dhaka. Telephone number, Fax number and address IP Phone: Fax: noor.hafza@sonalilife.com IP Phone: Fax: info@sonalilife.com IP Phone: Fax: Info@rupaliinsurance.com IP Phone: Fax: info@sonalilife.com IP Phone: Fax: info@sonalilife.com IP Phone: Fax: info@sonalilife.com IP Phone: Fax: info@sonalilife.com IP Phone: Fax: info@sonalilife.com IP Phone: Fax: info@sonalilife.com 26

37 10 Mr. Ahmed Rajeeb Samdani 11 Mrs. Hazera Hossain 12 Mrs. Hoda Ali Selim 13 Hanufa Akter Rikta 14 Quazi Moniruzzaman 15 Md. Nurun Nabi Independent Independent Independent House- 9, Road- 12, Block- SW(B), Gulshan- 1, Dhaka. 18/B, East Raja Bazar, Tejgaon, Dhaka. 1858, Sarder Ali Road, Mosque Goli, Chapilish, Chittagong. Bashura, Uttar Padua, Choddogram, Comilla South Rupsi,Rupsi, Rupgonj, Narayangonj H-18. R-3, PO-Chakbazar, PS-Panchlash, Chittagong IP Phone: Fax: IP Phone: Fax: IP Phone: Fax: IP Phone: Fax: IP Phone: Fax: IP Phone: Fax: (iv) Names, addresses, telephone numbers, fax numbers and addresses of the CFO, Company Secretary, Legal Advisor, Auditors and Compliance Officer: Name Position Address Telephone, Fax number and Mir Rashed Bin Aman Md.RAfe-Uz-Zaman Imtiaz Moinul Islam Ahmad& Akhtar Md.RAfe-Uz-Zaman Add. MD &Chief Financial Officer Company Secretary Lawyer (Legal Advisor) Auditor Compliance Officer 68/B D.I.T. Road,Malibagh Chowdhury Para,Dhaka. 68/B D.I.T. Road,Malibagh Chowdhury Para,Dhaka. LegalShelter. Appollo Ispat Complex, 407, Tejgaon Industrial Area, Dhaka BCIC Bhaban(3rd floor),30-31, Dilkusha C/A,Dhaka /B D.I.T. Road, Malibagh Chowdhury Para,Dhaka. IP Phone: Fax: IP Phone: Fax: Tel: , Fax: Tel: IP Phone: Fax: (v) Names, addresses, telephone numbers, fax numbers, contact person, website addresses and addresses of the issue manager: Telephone, Fax number, Name Address Contact person and Web. Manager to the Issue ICB Capital Management Ltd. Agrani Equity & Investment Limited Green City Edge (5th & 6th Floor) 89 Kakrail Dhaka Swantex bhaban (4 th floor) 9/1, Motijheel C/A, Dhaka Md. Sohel Rahman Chief Executive Officer (Additional Charge) Ahmed Yousuf Abbas Chief Executive Officer Tel: , , , FAX: Web: Tel: , FAX: Web: 27

38 Rgister to the Issue N/A (vi) Details of Credit Rating; (a)the names of the credit rating agencies from which credit rating has been obtained; Name of the Credit Rating Agency Rating Date WASO Credit Rating Company (BD) Limited 18 September, 2018 (b)the details of all the credit ratings obtained for the issue and issuer; Rating Type Credit Rating Status (Claim Paying Ability Rating) Long Term BBB2 Surveilance Date of Rating 18 September, 2018 Validity of Rating 17 September, 2019 Life Insurance companies rated BBB have medium financial security characteristics and considered medium grade and as much may possess certain speculative characteristics, Outlook but are more likely to be affected by adverse business conditions than higher rated insurers. CPA rating in this category is adjudged to offer moderate claims paying ability with medium financial security characteristics. But changes in underwriting and/or economic conditions are likely to have impact on the capacity to meet policyholder obligations than insurers in higher rated categories. (b) Observations and risk factors stated in the credit rating report; Observations and risk factors as stated in the credit rating report: Business Risk SLIC controls its business risks arising from different types of underwriting policies, underwriting professionals at 55 branches with the help of guideline of IDRA. The Company has decentralized its underwriting functions and delegated powers to its zonal offices and branches for rendering prompt, efficient and effective services to the clients. SLIC took standard procedure to minimize risk a by screening proposal of potential insured in the area his/her history, family background, health conditio n, medical requirement, confirmation from client several times along with confirming KYC and taking opinion of field officer and departmental agent. Skill level of employees engaged in underwriting process acts vitally behind innovation of new products and services that will help companies to attract newer clients and competitiveness in the market. SLIC handles its business risks arising from different types of underwriting policies, underwriting professionals at branch level by providing them spe cific instruction and guidelines from the Head Office over the period of time. It has been noted that the Company mainly concentrated on single policies insurance business in FY 2017 and gross premium received from single premium business represented 44.0% of total gross premium which has been sharply increase from 22.3% in FY Another significant long-term policies over 10 years insurance premium policies which represented 31.7% of total gross premium while renewal and group insurance premium held only 14.8% & 9.5% of total gross premium, respectively. 28

39 (a) The Rationale or description of the rating so obtained, as furnished by the credit rating agency; RATING RATIONALE WASO Credit Rating Company Limited (WCRCL) has assigned BBB2 (Triple B Two) Claim Paying Ability (CPA) rating to Sonali Life Insurance Company Limited (hereinafter referred SLIC) in the long term. WCRCL assigned the CPA rating based on audited financial statements upto 31st December 2017, Actuarial Valuation Report as at 31st December 2017 and other relevant management provided quantitative and qualitative data upto the date of rating declaration. The above rating has been assigned in consideration of its steady persistent in business, operating performance particularly in last year, seven days claim settlement policy impacted zero balance of claim outstanding, improving renewal premium impacted lapse in policies and establishing good governance in management along with experienced management team. The above factors are, however, constrained to some extent by volatile underwriting performance, low contributio n of renewal premium to gross premium, moderate lapse ratio, age of business subsequently impacted life fund and surplus amount and marginal liquidity ratio positioned lower state of industry. First year premium of the company experienced increasing trend over the last 5 years along with the renewal premium at the same time. The Company reported a growth in life fund (grew by %) in the last years, though volatile trend revealed compare to last three years. First year s premium contributed 75% in gross premium where as renewal premium contributed only 15% which seems low in Besides, Group Insurance premium also gradually decreased. During 2017, death claims amounting BDT 5.2 million was lodged. Of the total death claims BDT 4.7 million was paid during The Company also repudiated claims of BDT 0.5 million. Therefore, outstanding claim at the end of year was nil. As per policy they settled eve ry claim within 7 (Seven) days that is why SLIC have no claim outstanding since their commencement in On an average 1.1% of the policies were lapsed in the first year of issuance. On the other hand, on an average 21.8% and 33.1% of the total policies lapsed in the second year and third year of issuance respectively. If we consider three years dat a during , average of total lapse stood at 57%. However, average lapse ratio revealed moderate, considering latest five years data, stood at 38.4%. According to the actuarial valuation report as at 31st December 2017, there was net surplus of BDT million for the valuation period January 2017 to December In 2017, the Company kept BDT million as Life fund as against Net liability of BDT million. Therefore, total surplus as on 31 December 2017 was BDT million which was avai lable for distribution as bonuses with profit policies and dividend to shareholders for the valuation period. Compare to other insu rers in the industry life fund amount ranked low though SLIC achieved surplus of BDT million within short span of time. The company invested BDT million as of 31st December 2011 where the investment yield reported 10.39% in 2017 (average: 10.82%). Major portion of investment included FDR (61% of total investment), government securities (13%), ordinary shares (5%) and Property & Others (21%). Liquid asset to Life fund showed marginal ratio of 1.13x in 2017, however, moderate but scope to improve the ratio. Liquid assets to life fund of the Company decreased by 2.8 times in 2017 due to sharp increase of life fund same time. However, it was also noted that, according to the existing rule, 96.5% of 1st year premium is allowed as management expense whereas only 20% of the renewal premium is allowable in this regard (for companies of four to six years of operation). Therefore, life insurance companies having higher renewal premium are more profitable. But still, the Company s renewal premium was less compared to first year premium over the periods. The Company should focus on generating more underwriting profit from renewal premium to offset the business risk to some extent. Liquidity Risk Liquidity risk is the risk that a Company may be unable to meet short term financial demands. This usually occurs due to the inability to convert a security or hard asset to cash without a loss of capital and/or income in the process. The major liquidity 29

40 risk encountered by the Company is the daily calls on its available cash and resources in respect of claims arising from insurance contracts and maturity of investment securities. Liquidity risk also occurs more generally in relation to the ability to buy and sell investments. This is a function of size of SLIC holding relative to the availability of counter parties willing to buy or sell these holding at any given time. However the Company manages its liquidity by en suring sufficient liquidity to meet its claims and other liabilities when due under both normal & stressed conditions without incurring unacceptable losses or riskin g damage to the Company s reputation. Moreover, SLIC sets limit on the minimum portion of m aturing funds available to meet such calls to cover claims at unexpected levels of demand. Moreover, Company s FDR & STD with bank has observed to increase over the years. According the actuarial report (base year 2017) SLIC reported a surplus fund of BDT 74.4 million and a life fund of BDT million which means a good-looking amount in hand to meet any unforeseen claim or payment. Interest Rate Risk Interest rate risk arises out of investment decisions and acceptance of high exposures in any one type o f investment instrument. Volatility of money market has great influence over the interest rate structure of fund hold by Company. Interest Income of SLIC yielded significant portion of total income (10.4%). This income from fixed and other deposit may fall with the reduction of interest rate of commercial bank. In order to mitigate interest rate exposure, companies can invest into mutual funds to secure its revenue and also to generate capital gains. However, this source has also its own drawback, if the overall capital market position falls, then the performance of mutual fund will also decline. Thus the Company should more concentrate on tradition business in order to minimize any loss/reduction of income arise from the investment already made. Internal Control Risk Internal control risks are risks that affect the effectiveness and efficiency of internal controls and thus affect the achievement of objectives. Generally internal control risk arises from non compliance of rules and regulation which ultimately possess negative impact on overall business performance. SLIC has a separate internal audit department which assists in maintaining financial discipline and management of the Company. Head office receives data of revenue and expenses of each branch and branch controlling person is held responsible for review and reconcile of all the account. If any inconsistency is observed, the Company ensures proper investigation which leads to compensation charge to the responsible person. The Company ensures formation of Management Committee that deals with operational decisions. It is observed that the Board forms Audit Committee to look after all irregularities of the Company. Internal Audit Department, headed by professional, is assigned for the purpose of regular vi sit the branch offices audit and investigation. Branch Control Department follow-up all the branches regarding operation and take necessary action. Insurance Risk The risk under an insurance contract is that an insured event will occur including the uncert ainty of the amount and timing of any resulting claim. The principle risk the Company faces under such contracts is that the actual claims and benefit payments exceed the premiums written or the carrying amount of insurance liabilities. This is influenced by the frequency of claim; actual benefits paid being greater than originally estimated subsequent development of long-term claims. SLIC reduces this risk with the help of its experienced underwriting team who undertakes pre-insurance surveys of large and complicated risk. The Company manages these risks through its underwriting strategy, adequate reinsurance arrangements & proactive claims handling. SLIC has reinsurance agreement with SCOR Global Life SE, Singapore Branch from The retention limit is BDT 0.30 million. Risk management ensures proper understanding of the right level of risk acceptance, risk control and risk related expenditure. 30

41 Competition in the market At present, there are 32 life insurance companies (including JBC & 2 foreign co.) in Bangladesh and all of them are active in the industry and responsible of total gross premium of over BDT 80.0 billion (ref: BIA, 2017). Total premium income of privat e sector life insurance companies dropped by % to BDT billion in 2016 from BD T billion in 2015, which has declined by % in Considering the gross premium received, SLIC is representing only 0.51% of market share. Whereas other top performers by their first year premium earnings were: Fareast Islami Life at BDT 3.79 billion, National Life at BDT 2.23 billion, Popular Life at BDT 2.75 billion, Delta Life at 1.90 billion, Guardian Life at BDT 1.47 billion, Progati Life at BDT 1.48 billion, state-owned Jiban Bima Corporation at BDT 1.36 billion, Prime Islami Life at BDT 1.26 billion, Meghna Life at BDT 1.04 billion, Rupali Life at BDT 857 million and Sandhani Life approximately at BDT 620 million, Sunflower Life at ove r BDT 500 million. As a result, intense competitions exist between big industry players. To be competitive in the market, SLIC needs to develop new products and offer excellent clientele service instead of sharing higher agency commission with the client. Moreover, the Company also needs to expand its market otherwise the competitors may take away its busine ss. 31

42 Socio-political-economic Risks Although current market political situation in Bangladesh is quite stable than previous years, still it is always a major pro blem in carrying out any business in Bangladesh. The risk arises out of changes in the country s political, social and economic environment which might negatively impacts on the overall employment, savings and thus investment of the country. For the instability in politics, may disruptive situations and created which have negative impact on every b usiness. The people who operate various types of businesses in our country, often experience inconvenience in running their business. Insurance business is not an exception of this impact. Political instability may negative impact on overall policy collect ion of the Company and number of claim against policies. The Company has cautious approach to deal with such risks. Human resources Risk Human resources risk arises in many forms. Not having the rights person in place and with required skills needed to compete is two of those risks. Companies with an ageing workforce are even at more risk. It is noted that, insurance industry of Bangladesh needs to transform. Lack of frequent training from developed nation s results into information gap and under development of the sector. Like most of the private sector life insurance Company, SLIC holds a very insignificant portion of total market & is continuously striving to hold the position, Requirement of energetic, qualified professionals is expected t o gear up the business. Regulatory Risk The increasing intensity of regulatory requirements poses a significant threat to the industry. The new Insurance Development and Regulatory Authority Act-2010 and Insurance Act-2010 replaced the old insurance laws which are likely to bring significant changes in the regulation of the industry. In order to make overall claim settlement procedure smooth and timely, insurance companies are required to set up a special fund known as policyholders Protection Fund. For further enhancing the solvency position, paid up capital for non-life and life insurance companies have been raised to BDT million and BDT million respectively. Credit Rating practice for the insurance companies is expected to create a positive vibration in the industry as the institutional insured expect for good credit rating to safeguard their interest. All these requirements will make the market more reliable and uniform. The same will pressurize the underperforming insurance companies to retain their market share. In accordance with the Insurance Act 2010, SLIC has been trying to increase its paid up capital currently, the Company s paid up capital reached to BDT million. Experienced board committee especially audit committee of SLIC s acting in accordance with the guidelines provided in the notification dated 7th August, 2012 of BSEC and ensuring all relevant requirements for the Company. Market &Technology Related Risk Market risk relates to the volatility of the market price of assets. It invo lves exposure to movements in the level of financial variables such as stock prices, interest rates, exchange rates or commodity prices. On the other hand, technology is a continuous process of development. Innovation of new and cost effective technology m ay obsolete existing technology which may cause negative impact on the business. Insurance business is increasing day by day as our country is developing and peoples of the country is realizing the need of insurance which resulted into new types of insuran ce are coming into focus. However, the Company is well acquainted with the recent change and believes that there are very low chances that recent technology may hamper the operation of the Company. Financial Risk First year premium of the company experienced increasing trend over the last 5 years along with the renewal premium at the same time. The Company reported a growth in life fund (grew by %) in the last years, though volatile trend revealed 32

43 compare to last three years. First year s premium contributed 75% in gross premium where as renewal premium contributed only 15% which seems low in Besides, Group Insurance premium also gradually decreased. During 2017, death claims amounting BDT 5.2 million was lodged. Of the total death claims BDT 4.7 million was paid during The Company also repudiated claims of BDT 0.5 million. Therefore, outstanding claim at the end of year was nil. As per policy they settled eve ry claim within 7 (Seven) days that is why SLIC have no claim outstanding since their commencement in On an average 1.1% of the policies were lapsed in the first year of issuance. On the other hand, on an average 21.8% and 33.1% of the total policies lapsed in the second year and third year of issuance respectively. If we consider three years data during , average of total lapse stood at 57%. However, average lapse ratio revealed moderate, considering latest five years data, stood at 38.4%. According to the actuarial valuation report as at 31st December 2017, there was net surplus of BDT million for the valuation period January 2017 to December In 2017, the Company kept BDT million as Life fund as against Net liability of BDT million. Therefore, total surplus as on 31 December 2017 was BDT million which was available for distribution as bonuses with profit policies and dividend to shareholders for the valuation period. Compare to other insu rers in the industry life fund amount ranked low though SLIC achieved surplus of BDT million within short span of time. The company invested BDT million as of 31st December 2011 where the investment yield reported 10.39% in 2017 (average: 10.82%). Major portion of investment included FDR (61% of total investment), government securities (13%), ordinary shares (5%) and Property & Others (21%). Liquid asset to Life fund showed marginal ratio of 1.13x in 2017, however, moderate but scope to improve the ratio. Liquid assets to life fund of the Company decreased by 2.8 times in 2017 due to sharp increase of life fund same time. (vi) Following details of underwriting: (a) The names, addresses, telephone numbers, fax numbers, contact persons and addresses of the underwriters and the amount underwritten by them Sl. # 1 Name and Address of the underwriters ICB Capital Management Ltd. Green City Edge (5th & 6th Floor), 89 Kakrail,Dhaka Contact person Md. Sohel Rahman Chief Executive Officer (Additional Charge) Telephone numbers, Fax numbers and Tel: , , , FAX: ceocmcl@accesstel.net; Amount in Tk. 66,500, Total 66,500,

44 (b) Declaration by the Underwriters Due diligence certificate by the underwriter(s) [See rule 4 (1)(d)] To The Bangladesh Securities and Exchange Commission Sub: Public offer of 19,000,000Ordinary Shares of BDT. 190,000,000.00ofSonali Life Insurance Company Limited. Dear Sir, We, the under-noted Underwriter(s) to the above-mentioned forthcoming issue, state individually and collectively as follows: (1) We, while underwriting the above mentioned issue on a firm commitment basis, have examined the draft prospectus, other documents and materials as relevant to our underwriting decision; and (2) On the basis of such examination and the discussions with the issuer company, its directors and officers, and other agencies, independent verification of the statements concerning objects of the issue and the contents of the documents and other materials furnished by the issuer company. WE CONFIRM THAT: (c) We are registered with the Bangladesh Securities and Exchange Commission as a merchant banker and eligible to carry out the underwriting activities. Our present paid-up capital stands at Tk (Three hundred twenty nine point sixty five) crore and we have the capacity to underwrite a total amount of Tk. 2, (Taka two thousand two hundred seven point three zero) crore as per relevant legal requirements. We have committed to underwrite for up to Tk (six point sixty five) crore for the upcoming issue. (d) At present, the following underwriting obligations are pending for us: Sl. No. Name of the Company Amount Underwritten (in Tk.) 1 STS Holdings Limited 60,900, Delta Hospital Limited 16,000, ADN Telecom Limited 199,500, Desh General Insurance Company Ltd. 5,600, Energypac Power Generation Ltd. 42,500, Ratanpur Steel Re-Rolling Mills Ltd. 37,500, AB Bank Limited 750,000, Mohammed Elias Brothers POY Manufacturing Limited 10,000, Star Ceramics Limited 62,500, Modern Steel Mills Limited 150,000, Dragon Sweater and Spinning Limited 381,666, egeneration Limited 20,000, Esquire Knit Composite Limited 40,000, Mir Akhter Hossain Limited 20,000, Total= 1,796,166, (c) All information as are relevant to our underwriting decision have been received by us and the draft prospectus forwarded to the Commission has been approved by us; (d) We shall subscribe and take up the un-subscribed securities against the above-mentioned public issue within 15 (fifteen) days of calling up thereof by the issuer; and 34

45 (e) This underwriting commitment is unequivocal and irrevocable. For the Underwriter: (Md. Sohel Rahman) Chief Executive Officer (Additional Charge) Date: 01 October, 2018 (c) Major Terms and Conditions of the Underwriting Agreements 1. In case of under-subscription in any category by up to 35% in an Initial Public Offer, the undersubscribed portion of securities shall be taken up by the underwriter. 2. In case of failure to deposit the remaining amount by the eligible investors, the unsubscribed securities shall be taken up by the underwriter. 3. The issuer, in the event of under subscription, shall send notice to the underwriter(s) within ten days of closure of subscription calling upon them to subscribe the securities and pay for this in cash in full within fifteen days of the date of said notice and the said amount shall be credited into securities subscription account within the said period. If payment is made by Cheque/ Bank Draft by the underwriter it will be deemed that the underwrite r has not fulfilled his obligation towards his underwriting commitment under this agreement, until such time as the Cheque/ Bank Draft has been encased and the Company s account credited. In any case within 7 (seven) days after the expiry of the aforesaid 15 (fifteen) days, the Company shall send proof of subscription and deposit of money by the underwriter to the Commission. In the case of failure by the underwriter to pay for the shares under the terms mentioned above, the said underwriter will not be eligible to underwrite any issue, until such time as he fulfils his underwriting commitment under this Agreement and also other penalties as may be determined by the Commission may be imposed. In the case of failure by the underwriter to pay for the shares w ithin the stipulated time, the Company/issuer will be under no obligation to pay any underwriting commission under this Agreement. In the case of failure by the Company to call upon the underwriter for the aforementioned purpose within the stipulated time, the Company and its s shall individually and collectively be held responsible for the consequences and/or penalties as determined by the Bangladesh Securities and Exchange Commission under the law. 4. The Company shall pay to the underwriter an underwriting commission at the rate of 0.50% of the amount underwritten hereby agreed to be underwritten by it. (c) Capital Structure (i) Authorized, issued, subscribed and paid up capital (number and class of securities, allotment dates, nominal price, issue price and form of consideration); Particulars No. of Ordinary Shares Allotment Dates** Nominal Price/Face Value* Issue Price Amount in Tk ,000,000, Authorized Capital 100,000,000 Allotment Dates are Issued, Subscribed and Paid 28,500,000 given up capital below ,000, Total Paid-up Capital before IPO 28,500, ,000, After IPO To be issued as IPO 19,000, ,000, Paid-up Capital after IPO 47,500, ,000, **The Company has raised its paid-up capital in following phases: 35

46 Particulars of allotment Date of allotment Mode of Consideration Other Bonus In Cash than Share Cash Nominal Price Issue Price Amount in Tk. First (at the time of incorporation) ,000, /- 10/- 180,000, Second ,500, /- 10/- 105,000, Total 28,500,000 Ordinary each 28,500, ,000, (ii) Size of the present Issue, with break-up (number of securities, description, nominal value and issue amount); Particulars Number of Securities For EIs 9,500,000 For General Public 9,500,000 Description Offer price Tk each Offer price Tk each Nominal Value/ Face Value Issue Amount in Tk ,000, ,000, Total 190,000, (iii) Paid up capital before and after the present issue, after conversion of convertible instruments (if any) and share premium account (before and after the issue); Particulars Amount in Tk. Paid up capital before the present issue (as on June 30, 2018) 285,000, Paid up capital after the present issue 475,000, Paid up capital after conversion of convertible instruments (if any) The Company has no convertible instrument Share premium account before the present issue (as on June 30, 2018) N/A Share premium account after the present issue N/A (iv) Category-wise shareholding structure with percentage before and after the present issue and after conversion of convertible instruments (if any); The paid-up capital of the Company is Tk. 285,000, The Company intends to Public Offering of 19,000,000 ordinary shares, of these ordinary shares 50% i.e. 9,500,000 ordinary shares are reserved for Eligible Investor (EI) which includes 40% i.e. 7,600,000 ordinary shares for EI excluding Mutual Funds and CIS and 10% i.e. 1,900,000 ordinary shares for Mutual Funds and CIS and remaining 50% i.e. 9,500,000 ordinary shares for General Public including NRBat the issue price of Tk (at per)totaling BDT 190,000, No of ordinary shares Percentage of holding SL Shareholding Category Pre-Issue IPO Post-Issue Pre-Issue Post-Issue (a) (b) (a+b) 1 Sponsors and s 28,500,000-28,500, % 60% 2 Institutional - 9,500,000 9,500,000-20% 3 Public - 9,500,000 9,500,000-20% Total 28,500,000 1,900,000 47,500, % 100% Convertible Instrument The company has no convertible instruments as on the date of this prospectus. 36

47 s &Sponsorshareholding structure with percentage before and after the present issue is as follows: Sl. No. Of Ordinary Shares Hold Percentage Of Holding Name Category No. Pre-IPO Post-IPO Pre-IPO (%) Post-IPO (%) 1 Fauzia Quamrun Tania 4,386,500 4,386, % 9.23% 2 K.M Farookh (Nominee Of Rupali Insurance 4,566,000 4,566, % 9.61% Company Limited) 3 Shafia Sobhan Chowdhury 3,630,000 3,630, % 7.64% 4 Sheikh Mohammad Danial 3,695,000 3,695, % 7.78% 5 Noor-E-Hafza 2,927,500 2,927, % 6.16% 6 Ahmed Rajeeb Samdani 1,530,000 1,530, % 3.22% 7 Hazera Hossain 1,285,000 1,285, % 2.71% 8 Omar Khayam 1,000,000 1,000, % 2.11% 9 Sheikh Omar Faruque 1,000,000 1,000, % 2.11% 10 Kamrun Nahar 1,150,000 1,150, % 2.42% 11 Maya Rani Roy 1,000,000 1,000, % 2.11% 12 Hoda Ali Selim 1,000,000 1,000, % 2.11% 13 Nargis Mahmuda Shareholder 1,000,000 1,000, % 2.11% 14 Phowzia Khan Shareholder 330, , % 0.69% Total 28,500,000 28,500, % 60% Other than s & Sponsor Shareholdings: There is no Shareholder other than the s & Sponsor shares. (v) Where Shares have been issued for consideration in other than cash at any point of time, details in a separate table, indicating the date of issue, persons to whom those are issued, relationship with the issuer, issue price and whether any benefits have been accrued to the issuer out of the issue; The company has not issued any share in other than cash. (vi) Where Shares have been allotted in terms of merger, amalgamation or acquisition details of the scheme and shares allotted; The Company has not allotted any shares in terms of any merger, amalgamation or acquisition scheme. (vii) Where the issuer has issued equity shares under one or more employee stock option schemes, including the price at which such equity shares were issued; The Company did not issue any equity shares under one or more stock option schemes to its employees. (Viii) If the issuer has made any issue of specified securities at a price lower than the issue price during the preceding two years, specific details of the names of the persons to whom such specified securities have been issued, relation with the issuer, reasons for such issue and the price thereof The issuer has not made any issue of specified securities at a price lower than the issue price during the preceding two year s. (ix) The decision or intention, negotiation and consideration of the issuer to alter the capital structure by way of issue of specified securities in any manner within a period of one year from the date of listing of the present issue The Company has no such decision or plan, contract, negotiation and consideration to alter its capital structure by way of issue of specified securities in any manner within a period of one year from the date of listing of the present issue. 37

48 (x) The total shareholding of the sponsors and directors in a tabular form, clearly stating the names, nature of issue, date of allotment, number of shares, face value, issue price, consideration, date when the shares were made fully paid up, percentage of the total pre and post issue capital, the lock in period and the number and percentage of pledged shares, if any, held by each of them Sl No Name Mrs. Noor-E- Hafza (Sponsor & ) K.M Farookh (Nominee Of Rupali Insurance Company Limited). (Sponsor & ) Fauzia Quamrun Tania (Sponsor & ) Shafia Sobhan Chowdhury (Sponsor & ) Sheikh Mohammed Danial (Sponsor & ) Ahmed Rajeeb Samdani (Sponsor & ) Hazera Hossain (Sponsor & ) Kamrun Nahar (Sponsor & ) Maya Rani Roy (Sponsor & ) Hoda Ali Selim (Sponsor & ) Mr. Sheikh Omar Faruque (Sponsor & ) Nature Of Issue Ordinary Ordinary Ordinary Ordinary Ordinary Ordinary Ordinary Ordinary Ordinary Ordinary Ordinary Date Of Allotment Transfer and date when the shares were made fully paid up No. Of Shares ,160, ,767,500 Total 2,927, ,000, ,566,000 Total 4,566, ,450, ,936,500 Total 4,386, ,930, ,700,000 Total 3,630, ,500, ,195,000 Total 3,695, ,030, ,000 Total 1,530, ,030, ,000 Total 1,285, ,000, ,000 Total 1,150, , ,000 Total 1,000, , ,000 Total 1,000, ,000,000 Total 1,000,000 Face Value & Issue Price Consideration Pre- IPO (%) Post- IPO (%) Lock In Period 10 Cash 10.27% 6.16% 3 Years 10 Cash 16.02% 9.61% 3 Years 10 Cash 15.39% 9.23% 3 Years 10 Cash 12.74% 7.64% 3 Years 10 Cash 12.96% 7.78% 3 Years 10 Cash 5.37% 3.22% 3 Years 10 Cash 4.51% 2.71% 3 Years 10 Cash 4.04% 2.42% 3 Years 10 Cash 3.51% 2.11% 3 Years 10 Cash 3.51% 2.11% 3 Years 10 Cash 3.51% 2.11% 3 Years Number & % of pledge of shares No Share is pledged by the company No Share is pledged by the company No Share is pledged by the company No Share is pledged by the company No Share is pledged by the company No Share is pledged by the company No Share is pledged by the company No Share is pledged by the company No Share is pledged by the company No Share is pledged by the company No Share is pledged by the company 38

49 Sl No Name Nature Of Issue Mr. Sheikh Umar Khumyam (Sponsor & ) Mrs. Nargis Mahmuda (Sponsor Shareholder) Ms. Phowzia Khan (Sponsor Shareholder) Total Date Of Allotment Transfer and date when the shares were made fully paid up No. Of Shares Face Value & Issue Price Consideration Pre-IPO (%) Post- IPO (%) Lock In Period Ordinary ,000, Cash 3.51% 2.11% 3 Years Ordinary Ordinary Total 1,000, ,000,000 Total 1,000, ,000 Total 330, Cash 3.51% 2.11% 3 Years 10 Cash 1.16% 0.69% 3 Years 28,500, % 60% Number & % of pledge of shares No Share is pledged by the company No Share is pledged by the company No Share is pledged by the company (xi) The details of the aggregate shareholding of the sponsors and directors, the aggregate number of specified securities purchased or sold or otherwise transferred by the sponsor and/or by the directors of the issuer and their related parties within six months immediate preceding the date of filing the Prospectus; Aggregate shareholding of the sponsors and directors: SN Name Percentage Of Holding Number of Shares Held Pre-IPO (%) Post-IPO (%) 1 K.M Farookh (Nominee Of Rupali Insurance Company Limited) 3,000, % 6.316% 2 Fauzia Quamrun Tania 4,311, % 9.077% 3 Shafia Sobhan Chowdhury 2,130, % 4.484% 4 Sheikh Mohammad Danial 1,700, % 3.579% 5 Noor-E-Hafza 1,160, % 2.442% 6 Ahmed Rajeeb Samdani 1,030, % 2.168% 7 Hazera Hossain 1,285, % 2.705% 8 Omar Khayam 1,000, % 2.105% 9 Sheikh Omar Faruque 1,000, % 2.105% 10 Kamrun Nahar 1,100, % 2.316% 11 Maya Rani Roy 1,000, % 2.105% 12 Hoda Ali Selim 950, % 2.000% 13 Nargis Mahmuda 1,000, % 2.105% 14 Phowzia Khan 330, % 0.695% Total 28,500, % 60% Transferred by the sponsor and/or by the directors of the issuer: No share is purchased or sold or otherwise transferred by the sponsor and/or by the directors of the issuer and their related parties within six months immediate preceding the date of filing the Prospectus. 39

50 (xii) The name and address of any person who owns, beneficially or of record, 5% or more of the securities of the issuer, indicating the amount of securities owned, whether they are owned beneficially or of record, and the percentage of the securities represented by such ownership including number of equity shares which they would be entitled to upon exercise of warrant, option or right to convert any convertible instrument; Sl. no Name of the Shareholders 1 Fauzia Quamrun Tania K.M Farookh (Nominee Of Rupali Insurance Company Limited) Shafia Sobhan Chowdhury Sheikh Mohammad Danial 5 Noor-E-Hafza 6 Ahmed Rajeeb Samdani Address House- 03, Road- 2/3, Banani, Dhaka Dream Castle, House #7, Road #4, Gulshan-1, Dhaka House- 69, Road- 7, Block- F, Banani, Dhaka. House- 4, Road- 6, Khulshi, Chittagong. Dream Castle, House- 7, Road- 4, Gulshan-1, Dhaka House- 9, Road- 12, Block- SW(B), Gulshan, Dhaka. Quantity of Securities Held % of securities owned 4,386, % 4,566, % 3,630, % 3,695, % 2,927, % 1,530, % Type of ownership Sponsor Sponsor Sponsor Sponsor Sponsor Sponsor As far as the existing information is concerned, there is neither any event occurred nor any intent of exercising warrant, option or right to convert any convertible instrument. (xiii)the number of securities of the issuer owned by each of the top ten salaried officers, and all other officers or employees as group, indicating the percentage of outstanding shares represented by the securities owned; None of the Top ten salaried officers or other employees is holding any securities of the company. (d) Description of the Business: (i) The date on which the issuer company was incorporated and the date on which it commenced operation and nature of business which the company and its subsidiaries are engaged in or propose to engage in; The Company was incorporated on July 7, 2013 and got the certificate to commence business on July 17, It registered with the Insurance Development and Regulatory Authority (IDRA) in carrying on the business of life insurancenon July 30, SLICL does not have any subsidiary. Nature of Business: The company is engaged in the ordinary life insurance, pension and group insurance business since its incorporation. The company offers a wide variety of insurance products which fulfils the requirements of present and prospective policy holders. The product portfolio of the company feeds the following insurance lines: a. Ordinary Life Insurance, b. Group Insurance, c. Islami Jibon Bima (Takaful). (ii) Registered Office of the Company The Registered office is situated at Rupali Bima Bhaban, 7, Rajuk Avenue, Motijheel,Dhaka (iii) Plant, machinery, technology, process etc. This company is doing business in insurance sector. So, it has no operation with plant, machinery. It uses only computer softwares customized for doing life insurance business. 40

51 (iv) Details of the major events in the history of the issuer, including details of capacity or facility creation, launching of plant, products, marketing, change in ownership and/ or key management personnel etc.; Incorporation of the Company : 07 July, 2013 Starting of Commercial Operation : 01 August, 2013 Registered with IDRA 30 July, 2013 Capital Raised (Last) : Tk. 105,000, (Cash) on 09 June 2018 Details of capacity or facility creation, launching of plant : Since the Company is engaged in insurance business. So, there are no capacity or facility creation and no launching of plant in this respect. Changes in Ownership : There is no change in ownership till date. Change in key Management Personnel : No major changes have taken. Appointment of first Independent : 27 September, 2018 (v) Principal products or services of the issuer and markets for such products or services. Past trends and future prospects regarding exports (if applicable) and local market, demand and supply forecasts for the sector in which the product is included with source of data; Sonali Life Insurance Company Limited is carrying out the following types of insurance business: Principal Products General Life Insurance Group Insurance Principal Products Islami Life Insurance (Takaful) Plan Name Endowment Assurance Plan With Profits Anticipated Endowment Assurance Plan - 3 Stage With Profits Anticipated Endowment Assurance Plan - 5 Stage With Profits Ordinary Insurance Plan Without Profits Money Back Term Insurance Benefit With Profit Granted Child Protection Assurance Plan with Profits Education Expense Assurance Plan with Profits Ordinary Endowment Insurance With Profits Single Premium Insurance Plan Without Profits Assurance Cum Pension Plan Without Profits Denmohar Bima With Profits Hajj Bima With Profits Monthly Savings Assurance Plan With Profit Monthly Savings Micro Insurance Plan With Profit Plan Name Endowment Assurance Plan With Profits Anticipated Endowment Assurance Plan - 3 Stage With Profits Anticipated Endowment Assurance Plan - 5 Stage With Profits Child Protection Assurance Plan with Profits Single Premium Insurance Plan Without Profits Assurance Cum Pension Plan Without Profits Denmohar Bima With Profits Hajj Bima With Profits Monthly Savings Assurance Plan With Profit Monthly Savings Micro Insurance Plan With Profit 41

52 Past trends Last five yearscollection of insurance premium of Sonali life Insurance Company Ltd. are as under: Particulars 30-Jun-18 (06 months) Amount in Taka 31-Dec Dec Dec Dec Dec-13 Gross Premium 280,980, ,524, ,473, ,109, ,663, ,547, Net Premium 280,357, ,720, ,658, ,963, ,945, ,528, Investment Income 14,096, ,748, ,422, ,422, ,781, ,395, Premium Deposit 226, , , , , , Claim settlement: As on 30 June, Particulars No. of claim No. of Rejected No. of Paid No. of claim No. of Rejected No. of Paid No. of claim No. of Rejected No. of Paid No. of claim No. of Rejected No. of Paid No. of claim No. of Rejected No. of Paid No. of claim No. of Rejected No. of Paid Ordinary Life Group Insurance Islami Jibon Bima (Takaful) Future prospects of the product or service in the local market Sectorial share of insurance industry to the GDP at current prices is 0.38% in 2016 whereas 4.1% in 2015 found in the Bureau of Statistics, Bangladesh. Insurance penetration rate in Bangladesh is less than 1% since last consecutive years. The Government of Bangladesh has taken several steps for revitalizing the insurance sector to make it more vibrant and operationally sound; though amendments and initiatives can't make an overnight change in the sector. The regulatory reforms started with the introduction of the Insurance Act 2010 as the important rules /regulations under the Act have not yet been put in place. The absence of important rules/regulations has created a vacuum of insurance business in Bangladesh. It is being obligatory for insurance companies to charge premium rates as determined by the Regulatory Authority. However, the tariff rates have not been reviewed for a long time in the light of updated loss experience obtaining over the years and as such many clients do feel that they are being overcharged. Further short term and midterm objective of national insurance policy and guideline were not implemented. This has further negatively impacted on the public perception of the insurance industry at large thereby hindering its growth. The further progress of Bangladesh Insurance Industry predominantly depends on how the consumers perception of Insurance as a useful and efficient vehicle of risk transfers. This can be achieved through sustained efforts of the industry as well as regulators by holding public conference, by providing efficient services, honoring insurance policy obligations, introducing new products, aware the public by using technology and social mechanism and by rationalizing the pricing mechanism. Professionalism at every level of management is very crucial for overall development in this sector. So, our company takes strategic and policy aspects of the Company very carefully in addition to look after into the day to day operation. It has a very sound HR policy to attract the qualified people to choose the profession as a 'Career' not a mere 'Job'; as HR development program should be a part and parcel of regular business operation for the enhancement of skills and development of professionalism. Last but not the least; it is not the responsibility of the regulatory body alone to make revolutionary change, rather the re spective board, the management team and above all the insured should come forward to bring the sector to the global standard. The sooner it happens; the better is for the stakeholders in particular and the country in general. 42

53 Demand and Supply forecast The demand for insurance service is co related with the volume of business increase in the Country. It has been observed that the economy of Bangladesh is emerging and human living standard also increasing. To coverage the risk, the demand for insurance service is also increasing accordingly. Currently, there are 32 life insurance companies are serving their business in our country in order to cover the risk. As business volume is increasing in our country so the demand for insurance coverage increasing day by day to the client. There is a demand and supply gap remains in our country. Therefore, Government of Bangladesh permits number of insurance companies to run their business in this sector. (vi) If the issuer has more than one product or service, the relative contribution to sales and income of each product or service that accounts for more than 10% of the company s total revenues; Particulars 2018 (6 Months) Gross Premium Percentage (%) Gross Premium Percentage (%) Gross Premium Percentage (%) Gross Premium Percentage (%) Gross Premium Percentage (%) Gross Premium Percentage (%) Ordinary Life 273,320,398 97% 361,719,478 89% 152,139,774 78% 73,791,768 31% 41,492,355 27% 17,547, % Takaful 4,952,902 2% 6,922,200 2% 3,492,381 2% 2,478,346 1% 1,011,510 1% - Group Insurance Premium 2,707,627 1% 38,882,907 10% 39,841,328 20% 160,109,817 68% 108,663,000 72% - Total 280,980, % 407,524, % 195,473, % 236,379, % 151,166, % 17,547, % (vii) Description of Associates, subsidiary/related holding Company & their core areas of business SLICL does not have any associate, subsidiary and holding company. (viii) How the products or services are distributed with details of the distribution channel. Export possibilities and export obligation, if any Distribution Channel The final product reaches to the buyers from our Head office and branches through the following channel of distribution: Company The Company operates its business through the Head Office at Dhaka and the branches throughout the country. As on 30 June 2018, the Company has been operating its business through 52 branches along with one local office. Table of all branch offices: Insurance agents/online Application Policy holders SlNo Description Location Motijheel (Metro) 7 Rajuk Avenue Rupali Bima Bhaban Motijheel Dhaka Name of the lessor Rupali Insurance Com Ltd. Expiration date of the lease Principal terms and Condition 30/09/2022 Office Space: 1400 Sft Advance: Rent: Tk 40,000/- Remarks Malibagh 68/B DIT Road Chowdhury Para Malibagh Dhaka Mostafa Golam Quddus 31/12/2021 Office Space: 8300 Sft Advance: Rent: Tk 40,56,500/ Bakulia Sonar Modina Tower, 4 th Floor, Kala Mia Bazar, Bisho Road Tower, Eest Bakalia,Near Anonto Bilash clab, Chittagong. 18 Comilla Nahar Plaza 67/58 Nazrul Avenue (4 th floor) 2 nd Kandipar Comilla. Md.Firoz Hosain 30/09/2018 Office Space: 950 Sft Advance: 30,000/- Rent: Tk 10,000/- Md. Ibrahim Miah 30/11/2019 Office Space: 1200 Sft Advance: 40,000/- Rent: Tk 20,000/- Renewal Of rent agreement is under process 43

54 Rajshahi 110 no. Karim Super Market (3 rd floor), P.O: Ghoramara, P.S: Bowaliya, Dist: Rajshahi Agrabad (Metro) Agrabad Center (7th Floor) 2470/A S.K. Mujib Road Agrabad, Chittagong. Zahar Lal Joysoyal 31/03/2019 Office Space: 875 Sft Advance: 42,000/- Rent: Tk 14,000/- Agrabad Center 31/01/2019 Office Space: 1450 Sft Advance: 3,00,000/- Rent: Tk 36,000/ Sugandha House 170 (2nd Floor) Block - D Road No -2, Sugandha Residential Area Panchlaish Chittagong 39 - Meah Bazar Carnival (2nd Floor) P.O : Meah Bazar P.S: Chauddagram Dist: Comilla Mirza Pur Baima Hati, P.O.+ P.S : MirzaPur, Dist :Tangail Chandanaish 66 - Kasba (Metro) Hazi Shiraj Market (1st floor), boiltoli, Chandanaish, Chittagong. Simanta Complex-2, 2nd Floor, Kasba Puratan Bazar,Kasba,B-Baria Bonpara Shohid Dr. Aynul Hoque Pourashava Super Market (3rd Floor), P.o :Harara P.O: Boraigram, Dist: Nator Feni (Metro) Aziz Shopping Center (4th Floor), 189, S.S.K.Road, Feni Laxmipur Vill : Shomserabad, P.O : Laxmipur, P.S: Laxmipur Sadar, Dist : Laxmipur Raozan Vill : Sultanpur P.O + P.S : Raozan, Dist : Chittagong Netrokona 180/1, Shahor Satpai, P.O.+ P.S. + Dist : Netrokona Norshingdi (Takaful) Rangpur (Metro) Vill ; Srishtighor (Bus Stand Bazar) P.O : Chaitanya, P.S : Shibpur, Dist : Norshingdi. House No -286 Gupto para Station Road Rangpur sadar, Rangpur. Sheikh Abdul Motin 31/12/2019 Office Space: 2100 Sft Advance: Rent: Tk 42,000/- Saidunnessa 30/06/2022 Office Space: 1050 Sft Advance: Rent: Tk 12,000/- Md. Mosaraf Hossain Md. Selimur Rashid Bhuyan 30/09/2019 Office Space: 600 Sft Advance: Rent: Tk 4,500/- 31/03/2020 Office Space: 100 Sft Advance: 10,000/- Rent: Tk 1,300/- Md. Helal Uddin 31/05/2021 Office Space: 2300 Sft Advance: 2,40,000/- Rent: Tk 20,000/- Mayor Bonpara Pourashava 30/09/2020 Office Space: 1188 Sft Advance: 50,000/- Rent: Tk 8330/- Ayesha Akter 30/04/2020 Office Space: 667Sft Advance: Rent: Tk 21,600/- Kamrul Alam Chowdhury Mohammed Abul Kashem Chowdhury 31/12/2020 Office Space: 1250 Sft Advance: 20,000/- Rent: Tk 7,000/- 30/04/2021 Office Space: 396 Sft Advance: 15,000/- Rent: Tk 4,500/- Jinat Ara Parvin 30/11/2018 Office Space: 805 Sft Advance: Rent: Tk 5,000/- Azizul Islam 30/09/2020 Office Space: 100 Sft Advance: Rent: Tk 700/- Shah Md Mahafujar Rahman 30/11/2020 Office Space: 1000 Sft Advance: 4,80,000/- Rent: Tk 21,000 /- Renewal Of rent agreement is under process Akborshah (Takaful) Block I, Koibollodham R/A, Ferozshah, Akborshah, Chittagong Md. Shahjahan & Rezia Begum 31/12/2020 Office Space: 550 Sft Advance: 50,000/- Rent: Tk 9,000 / Sandip Town (Takaful) VIll : Haramia, P.O: Bokterhat P.S: Sondhip, Dist: Chittagong. Belayet Hossain Abul Kasham & Hashem 28/02/2019 Office Space: 750 Sft Advance: 50,000/- Rent: Tk 6,000 /- 44

55 Comilla (Metro) Nahar Plaza 67/58 Nazrul Avenue (8 th floor) 2 nd Kandipar Comilla. Md. Ibrahim Miah 31/08/2019 Office Space: 1600 Sft Advance: 42,000/- Rent: Tk 21,000/ Shibpur Bazar Jongi Shibpur Bazar Vill: Hosen Nogar P.O: Hosen Nogar P.S: Raypura Dist: Norshingdi Tangail House no Kodalia (1st Floor), P.O. : 1900 P.S : + Dist : Tangail. Shawpan Mahmud Md Shafiqul Islam Bhuiyan 30/09/2018 Office Space: 1350 Sft Advance: Rent: Tk 2,000 /- 28/02/2020 Office Space: 1600 Sft Advance: 30,000/- Rent: Tk 7,000/- Renewal Of rent agreement is under process Sandip Akborhat (Takaful) Vill: Gasuya P.O: Gasuya P.S: Sandip Dist: Chittagong. Joynal Abedin 31/05/2020 Office Space: 500 Sft Advance: Rent: Tk 2,000 / Sondhip Shiberhat (Takaful) Amir Hazer Bari, mait Vanga, shiberhat, Sondhip, Chittagong. Md.Idris Meah 31/03/2020 Office Space: 500 Sft Advance: Rent: Tk 5,500 / Bhuschi Bazar (Laksam) Chittagong (Metro) Cox's Bazar (Metro) Chokoria (Metro) Vill: Bhuschi Bazar P.O: Choto Sharitpur-3573 P.S: Sadar Dakshin Dist: Comilla. Chowdhury Center (3rd Floor),225/ A, C D A Avinew, Muradpur, Chittagong. Kazi Moniruzzaman 31/10/2019 Office Space: 900 Sft Advance: Rent: Tk 1,000 /- Taslima Nasrin 30/04/2020 Office Space: 1050 Sft Advance: 50,000/- Rent: Tk19,000 /- Coxs Bazar Nurul Islam 31/12/2018 Office Space: 900 Sft Advance: Rent: Tk 10,000 /- Abdul Motlob Shopping Complex (2nd Floor), Chiringa, Chakaria, Cox'sbaza Bhola Habib Super Market: (4th Floor) Mohajon Potti sadar Road Bhola M K Mohammad Miraj 30/04/2021 Office Space: 1300 Sft Advance: 50,000/- Rent: Tk12,000 /- Fardous Wahid 31/07/2019 Office Space: 850 Sft Advance: 24,000/- Rent: Tk 8,000 /- Renewal Of rent agreement is under process Pekuya (Metro) Sylhet (Metro) Mowlana Jahangir Alam Market, P.O : Pekuya, Chowmohoni, Dist : Coxs Bazar. West World Sopping City (8th Floor) Zollarpar Road, Zindabazar,Sylhet Mowlana Mohammad Jahangir Alam Mofik Ahmed Choudhury 30/06/2019 Office Space: 1000 Sft Advance: 50,000/- Rent: Tk9,000 /- 16/07/2019 Office Space: 870 Sft Advance: 65,000/- Rent: Tk13,000 / Wasa (Metro) Thakurgaon (Metro) Maheshkhali (Metro) M.B Complex (3rd floor) Holding No -90,High Seven Road,Lalkhan Bazar P.O:- Dam para P.S.Khulshi Dist : Chittagong Holding no-512naresh Chanhan road Thakurgaon Sadar P S + Dist : Thakurgaon Vill: Gorakgata Ekram Building P.O : Gorakgata P.S.:Maheshkhali Dist : Cox'sBazar Sadat Amin Mahmud 28/02/2020 Office Space: 700 Sft Advance: 1,40,000/- Rent: Tk13,000 /- Rashida Begum 30/11/2019 Office Space: 1400 Sft Advance: 27,000/- Rent: Tk9,000 /- Sahab Uddin 31/01/2021 Office Space: 840 Sft Advance: 60,000/- Rent: Tk5,000 /- 45

56 B -Baria (Metro) F.C Tower (3th Floor) Court Road, Brahmanbaria Md Arif Iqbal 31/12/2019 Office Space: 1800 Sft Advance: 72,000/- Rent: Tk24,000 / Monohorgonj Bazar Monohorgonj Bazar P.O + P.S :Monohorgonj Dist: Comilla. Moniruzzaman Chowdhuary 28/02/2020 Office Space: 100 Sft Advance: 3,000/- Rent: Tk 3,000 / Barisal (Metro) Laldighi (Metro 109 Sadar Road (4th Floor) P.O. : Barisal Sadar P.S : Kotwali Model Dist : Barisal. Gazi Tower (2nd Floor) 47 Laldighi, P.O ; Sada P.S : Kotowali Dist : Chittagong. S.K MD MUSA & SK. MD IDRIS Mohammad Saifullah 30/04/2021 Office Space: 1000 Sft Advance: 75,000/- Rent: Tk25,000 /- 31/03/2019 Office Space: 660 Sft Advance: 50,000/- Rent: Tk12,000 / Pirojpur (Metro) Vill : Charakhali P.O. + P.S : Indurkani Dist : Pirojpur Md Anayet Hossen 30/09/2019 Office Space: 280 Sft Advance: 10,000/- Rent: Tk1,500 / Keranihat (Metro) Vill + P.O. : Keranihat, P.S.: Satkania Dist : Chittagong. Faridul Alam 30/04/19 Office Space: 1500 Sft Advance: 50,000/- Rent: Tk15,000 / Hathazari (Metro) 278- Taraganj (Metro) 1049,Hathazari City Corporation (3rd floor) P.O. + P.S : Hathazari Dist : Chittagong. Paschim Kursha Dorjipara P.O + P.S :Taraganj Dist: Dinajpur Ahammed Hossain 31/01/2020 Office Space: 1970 Sft Advance: 53,000/- Rent: Tk15,000 /- Md. Sonaulla Sarker 30/06/20 Office Space: 800 Sft Advance: 12,000/- Rent: Tk4, Dagonbhuya (Metro) Cox's Bazar Agency (Metro) Kurigram (Metro) Mirpur (Metro) 74, "Al - Nur Jame Moszid " Market (3rd Floor) Chowmuhani Road, P.O + P.S: Dagonbhuiyan Dist : Feni. 58, "Al Aksa Shoping Tower Market (2nd Floor) P.O: Chiringa P.S: Chokoria Dist: Cox's bazar. Vill : Goshpara P.O + P.S: Kurigram Sadar Dist : Kurigram Fair Plaza Plot -C/3 Block -D Road no - 1 P.S.; Shahoali Mirpur -1, Dist : Dhaka. Al - Nur Jame Moszid (Mahmudul Huqe) M/S Al Aksa Pvt Ltd (Md Abu Nayyem Azad) 30/06/19 Office Space: 1024 Sft Advance: 60,000/- Rent: Tk10,000 30/06/19 Office Space: 1050 Sft Advance: 50,000/- Rent: Tk10,000 Aklima Khatun 31/10/20 Office Space: 875 Sft Advance: 15,000/- Rent: Tk5,000 Make Fair & Ltd (On BehalfMd Aga Khan) 31/08/2020 Office Space: 750 Sft Advance: 1,00,000/- Rent: Tk15, Panchagarh (Metro) Fulgazi (Metro) Jhenaidah (Metro) Kanchpur (Metro) Holding no- 626 Kayatpara P.O: Panchagarh P.S : Panchagarh Sadar Dist: Panchagarh 492, Fulgazi Trade Center ( 2nd Floor) Main Road P.O + P.S : Fulgazi Dist : Feni. House no - 48 Sher -E - Bangla Sarak, P.O. + P.S : Jhenaidah Sada, Dist:Jhenaidah. Senpara Jame Mosjid Shopping Complex (2nd Floor), P.O : Kanchpur, P.S : Sonargaon, Dist : Narayanganj, Md Jahangir Alam Jhunu Kamal Uddin Firoz Md Mostafa Md Ibrahim 30/09/2020 Office Space: 680 Sft Advance: 30,000/- Rent: Tk4,000 31/01/2020 Office Space: 667 Sft Advance: 60,000/- Rent: Tk8,000 Md.Mohiuddin 30/11/2020 Office Space: 1003 Sft Advance: 30,000/- Rent: Tk 6,000 Senpara Jame Mosjid Shopping Complex (Md Abul Khair) 31/08/2023 Office Space: 800 Sft Advance: 1,00,000/- Rent: Tk 10,000/- 46

57 Kendua Vill : Coat road P.O +P.S : Kendua Dist : Netrokona Khan Enterprise (Rafiqul Islam Khan) 31/07/2020 Office Space: 240 Sft Advance: Rent: Tk 3,200 /- Export Possibilities and Obligation: The Company doses not have any product regading exports and local marke, because the company SLICL is a life insurance service provider. (ix) Competitive conditions in business with names, percentage and volume of market share of major competitors; Competitive Conditions of Business: The competitive environment in the insurance industry in Bangladesh is quite complex. There are 29 private, 1 nationalized and 2 foreign life insurance companies, having extensive branch networks, holding huge premium deposit and enjoying certain prerogatives. There are the third generation private sector insurance company having comparative large branch networks, reasonable access to technology and market. Therefore, competition is increasing day by day. Although there is much competition in the insurance sector, the Sonali Life Insurance Company Ltd. has earned a notable position in this market through its performance, reliabilities, efficient management, experience and acceptance by its clients. Market Competitors: Zenith Islami Life Insurance Ltd. Mercantile Islami Life Insurance Ltd. NRB Global Life Insurance Company Ltd. Guardian Life Insurance Ltd. Chartered Life Insurance Company Ltd. Best Life Insurance Company Ltd. Protective Islami Life Insurance Co. Ltd. Swadesh Life Insurance Co. Ltd. Diamond Life Insurance Co. Ltd. Alpha Islami Life Insurance Ltd. Apart from this, as per annual report of the listed companies and audited financial statements of Sonali Life Insurance Company Limited, the turnover and paid up capital are presented below: S.L Company Name Gross Premium (Taka in crore) Paid-up Capital (Taka in crore) 1. Meghna Life Insurance Pragati Life insurance Padma Life Insurance (x) Sources and availability of raw materials and the Names and address of the principal suppliers and contingency plan in the case of disruption. The Company have not produced anyproducts that using rawmaterials, the company SLICL is a life insurance service provider. Contingency plan in case of Disruption of supplier The Company does not procure any raw materials and as such has no principal merchandizing supplier(s). (xi) Sources of, and requirement for, power, gas and water; or any other utilities and contingency plan in case of any disruption; The Company does not produce any product usingpower, gas and water. Therefore, it does not require such utilities except for ordinary use in administrative work. (xii)names, address(s), telephone number, web address, and fax number of the customers who account for 10% or more of the company s products or service with the amount and percentage thereof The Company has no such customer who contributes 10% or more of the total revenue. 47

58 (xiii)names, address(s), telephone number, web address, and fax number of the suppliers from whom account for 10% or more of its raw materials or finished goods with the amount and percentage thereof There are no suppliers who provided 10% or more of it s raw material/ finished goods. (xiv)description of any contract which the issuer has with its principal suppliers or customers showing the total amount and quality of transaction for which the contract is made and the duration of the contract. If there is not any of such contract, a declaration is to be disclosed duly signed by the CEO or MD, CFO and Chairman on behalf of the Board of s The Company has no such contract with principal suppliers or Customers. Declaration regarding Contract with Principal suppliers or customers We, on behalf of the Board of s certify that Sonali Life Insurance Company Limited did not enter into any contract with its principal suppliers or customers. Sd/- Mir RAshed bin Aman Add. MD &Chief Financial Officer Sd/- Ajit Chandra Aich Managing Sd/- Noor-E-Hafza Chairman (xv) Description of licenses, registration, NOC and permissions obtained by the Company with issue, renewal and expiry dates Description of licenses, registrations, NOC and permissions obtained by the issuer with issue, renewal and expiry dates: Sl Name of Licenses, registration, NOC and permission Certificate of Incorporation Trade License Certificate Certificate of Registration NOC to raise capital through IPO Consent for raising paid-up capital License Issuer/ Issuing Authority Registrar of Joint Stock Companies And Firms Dhaka South City Corporation Controller of insurance ( Duly renewed by IDRA) Insurance Development Regulatory Authority (IDRA) Bangladesh Securities and Exchange Commission(BSEC) Registration/ certificate/license No./ Permission letter No. Issue date Date of Renewal Date of expiry C /13 07/07/2013 N/A N/A No /07/ /09/ /06/2019 Life 02/ /07/2013 1/1/ /12/ Dated:12/12/ /12/2017 N/A N/A SEC/CI/CPLC-422/2013/2424 July 14,2013 N/A N/A (xvi) Description of any material patents, trademarks, licenses or royalty agreements; Sonali Life Insurance Company Limited does not have any material patents, trademarks, licenses or royalty agreements except as mentioned in the above table. (xvii) Number of total employees and number of full-time employees The company has 182full time employees as on June 30, The detailis given below: Salary Range (Monthly) Above Taka 3,000/- Officers and Staffs Workers Category Head Total Branch (Permanent) Office Full time Employees Part time employees

59 Below Taka 3,000/- Full time Employees Part time employees Total (xviii) Brief Description of Business strategy SLICL s key strategic objectives are to Ensure sustainable growth and modernization of existing facilities with potential for success through increasing Life insurance premium and valued customer service and transparancy; Achieve global competitiveness and to derive the full benefit of our World class ERPs advantage; Achieve technological superiority in our potential market; Strengthening financial resources; To optimise our shareholders' return/risk profile by ensuring that shareholders' equity continues to reflect both the volume of business and a corresponding investment policy (xix) A table containing the existing installed capacities for each product or service, capacity utilization for these products or services in the previous years, projected capacities for existing as well as proposed products or services and the assumptions for future capacity utilization for the next three years in respect of existing as well as proposed products or services. If the projected capacity utilization is higher than the actual average capacity utilization, rational to achieve the projected level; There is no such capacity in this respect. (e) Description of Property (i) Location and area of the land, building, principal plants and other property of the company and the condition thereof; The company possesses the following fixed assets as on June 30, Particulars Location Area Condition Land Building Principal Plant Other Property Nil Nil Nil Other property (Furniture 7 fixture, Computer hardware, Office equipment, Electric equipment, Motor vehicles, etc.) of the company is mostly situated at itsextended Head Office at 68/B, Malibagh, Dhaka and the rest are in the branch offices. Nil The entire property is in the possession of the issuer and has retained in good with secure condition. (ii) Whether the property is owned by the company or taken on lease; The issuer is the owner of the entire property situated at its extended head office, registered office (one of the branch offices) and other branch offices except floor spaces. The floor space of Extended Head Office at 68/B, Malibagh, Dhaka has taken on rent from Dragon Information and Technology Limited and other branch offices have taken on rent from different parties. (iii) Dates of purchase, last payment date of current rent (LvRbv) and mutation date of lands, deed value and other costs including details of land development cost, if any and current use thereof; The company has no land under its ownership. (iv) The names of the persons from whom the lands has been acquired/ proposed to be acquired along with thecost of acquisition and relation, if any, of such persons to the issuer or any sponsor or director thereof; 49

60 The company does not owned any land property to disclose. (v) Details of whether the issuer has received all the approvals pertaining to use of the land, if required; The Company does not have such land for which it needs approval from any authority pertaining to use those. (vi) If the property is owned by the issuer, whether there is a mortgage or other type of charge on the property, with name of the mortgagee; The company did not give its property to mortgage or other type of charge to any financial institution. (vii) If the property is taken on lease, the expiration dates of the lease with name of the lessor, principal terms and conditions of the lease agreements and details of payment; No property is taken on lease except the office premises which are rented for Extended Head office and Branch Offices under operating lease agreement. The detail is shown in the table below: SlNo Description Location Name of the lessor Expiration date of the lease Principal terms and Condition Remarks Motijheel (Metro) 7 Rajuk Avenue Rupali Bima Bhaban Motijheel Dhaka Rupali Insurance Com Ltd. 30/09/2022 Office Space: 1400 Sft Advance: Rent: Tk 40,000/ Malibagh 68/B DIT Road Chowdhury Para Malibagh Dhaka Mostafa Golam Quddus 31/12/2021 Office Space: 8300 Sft Advance: Rent: Tk 40,56,500/ Bakulia Comilla Sonar Modina Tower, 4 th Floor, Kala Mia Bazar, Bisho Road Tower, Eest Bakalia,Near Anonto Bilash clab, Chittagong. Nahar Plaza 67/58 Nazrul Avenue (4 th floor) 2 nd Kandipar Comilla. Md.Firoz Hosain 30/09/2018 Md. Ibrahim Miah 30/11/2019 Office Space: 950 Sft Advance: 30,000/- Rent: Tk 10,000/- Office Space: 1200 Sft Advance: 40,000/- Rent: Tk 20,000/- Renewal Of rent agreement is under process Rajshahi 110 no. Karim Super Market (3 rd floor), P.O: Ghoramara, P.S: Bowaliya, Dist: Rajshahi. Zahar Lal Joysoyal 31/03/2019 Office Space: 875 Sft Advance: 42,000/- Rent: Tk 14,000/ Agrabad (Metro) Agrabad Center (7th Floor) 2470/A S.K. Mujib Road Agrabad, Chittagong. Agrabad Center 31/01/2019 Office Space: 1450 Sft Advance: 3,00,000/- Rent: Tk 36,000/ Sugandha Meah Bazar Mirza Pur Chandanaish 66 - Kasba (Metro) House 170 (2nd Floor) Block - D Road No -2, Sugandha Residential Area Panchlaish Chittagong Carnival (2nd Floor) P.O : Meah Bazar P.S: Chauddagram Dist: Comilla. Baima Hati, P.O.+ P.S : MirzaPur, Dist :Tangail. Hazi Shiraj Market (1st floor), boiltoli, Chandanaish, Chittagong. Simanta Complex-2, 2nd Floor, Kasba Puratan Bazar,Kasba,B-Baria. Sheikh Abdul Motin 31/12/2019 Saidunnessa 30/06/2022 Md. Mosaraf Hossain Md. Selimur Rashid Bhuyan 30/09/ /03/2020 Md. Helal Uddin 31/05/2021 Office Space: 2100 Sft Advance: Rent: Tk 42,000/- Office Space: 1050 Sft Advance: Rent: Tk 12,000/- Office Space: 600 Sft Advance: Rent: Tk 4,500/- Office Space: 100 Sft Advance: 10,000/- Rent: Tk 1,300/- Office Space: 2300 Sft Advance: 2,40,000/- 50

61 Rent: Tk 20,000/ Bonpara Shohid Dr. Aynul Hoque Pourashava Super Market (3rd Floor), P.o :Harara P.O: Boraigram, Dist: Nator. Mayor Bonpara Pourashava 30/09/2020 Office Space: 1188 Sft Advance: 50,000/- Rent: Tk 8330/ Feni (Metro) Aziz Shopping Center (4th Floor), 189, S.S.K.Road, Feni. Ayesha Akter 30/04/2020 Office Space: 667Sft Advance: Rent: Tk 21,600/ Laxmipur Raozan Netrokona Norshingdi (Takaful) Vill : Shomserabad, P.O : Laxmipur, P.S: Laxmipur Sadar, Dist : Laxmipur. Vill : Sultanpur P.O + P.S : Raozan, Dist : Chittagong. 180/1, Shahor Satpai, P.O.+ P.S. + Dist : Netrokona Vill ; Srishtighor (Bus Stand Bazar) P.O : Chaitanya, P.S : Shibpur, Dist : Norshingdi. Kamrul Alam Chowdhury Mohammed Abul Kashem Chowdhury 31/12/ /04/2021 Jinat Ara Parvin 30/11/2018 Azizul Islam 30/09/2020 Office Space: 1250 Sft Advance: 20,000/- Rent: Tk 7,000/- Office Space: 396 Sft Advance: 15,000/- Rent: Tk 4,500/- Office Space: 805 Sft Advance: Rent: Tk 5,000/- Office Space: 100 Sft Advance: Rent: Tk 700/- Renewal Of rent agreement is under process Rangpur (Metro) House No -286 Gupto para Station Road Rangpur sadar, Rangpur. Shah Md Mahafujar Rahman 30/11/2020 Office Space: 1000 Sft Advance: 4,80,000/- Rent: Tk 21,000 / Akborshah (Takaful) Block I, Koibollodham R/A, Ferozshah, Akborshah, Chittagong Md. Shahjahan & Rezia Begum 31/12/2020 Office Space: 550 Sft Advance: 50,000/- Rent: Tk 9,000 / Sandip Town (Takaful) VIll : Haramia, P.O: Bokterhat P.S: Sondhip, Dist: Chittagong. Belayet Hossain Abul Kasham & Hashem 28/02/2019 Office Space: 750 Sft Advance: 50,000/- Rent: Tk 6,000 / Comilla (Metro) Nahar Plaza 67/58 Nazrul Avenue (8 th floor) 2 nd Kandipar Comilla. Md. Ibrahim Miah 31/08/2019 Office Space: 1600 Sft Advance: 42,000/- Rent: Tk 21,000/ Shibpur Bazar Tangail Jongi Shibpur Bazar Vill: Hosen Nogar P.O: Hosen Nogar P.S: Raypura Dist: Norshingdi House no Kodalia (1st Floor), P.O. : 1900 P.S : + Dist : Tangail. Shawpan Mahmud Md Shafiqul Islam Bhuiyan 30/09/ /02/2020 Office Space: 1350 Sft Advance: Rent: Tk 2,000 /- Office Space: 1600 Sft Advance: 30,000/- Rent: Tk 7,000/- Renewal Of rent agreement is under process Sandip Akborhat (Takaful) Vill: Gasuya P.O: Gasuya P.S: Sandip Dist: Chittagong. Joynal Abedin 31/05/2020 Office Space: 500 Sft Advance: Rent: Tk 2,000 / Sondhip Shiberhat (Takaful) Amir Hazer Bari, mait Vanga, shiberhat, Sondhip, Chittagong. Md.Idris Meah 31/03/2020 Office Space: 500 Sft Advance: Rent: Tk 5,500 /- 51

62 Bhuschi Bazar (Laksam) Chittagong (Metro) Cox's Bazar (Metro) Chokoria (Metro) Bhola Vill: Bhuschi Bazar P.O: Choto Sharitpur-3573 P.S: Sadar Dakshin Dist: Comilla. Chowdhury Center (3rd Floor),225/ A, C D A Avinew, Muradpur, Chittagong. Kazi Moniruzzaman 31/10/2019 Taslima Nasrin 30/04/2020 Coxs Bazar Nurul Islam 31/12/2018 Abdul Motlob Shopping Complex (2nd Floor), Chiringa, Chakaria, Cox'sbaza. Habib Super Market: (4th Floor) Mohajon Potti sadar Road Bhola M K Mohammad Miraj 30/04/2021 Fardous Wahid 31/07/2019 Office Space: 900 Sft Advance: Rent: Tk 1,000 /- Office Space: 1050 Sft Advance: 50,000/- Rent: Tk19,000 /- Office Space: 900 Sft Advance: Rent: Tk 10,000 /- Office Space: 1300 Sft Advance: 50,000/- Rent: Tk12,000 /- Office Space: 850 Sft Advance: 24,000/- Rent: Tk 8,000 /- Renewal Of rent agreement is under process Pekuya (Metro) Mowlana Jahangir Alam Market, P.O : Pekuya, Chowmohoni, Dist : Coxs Bazar. Mowlana Mohammad Jahangir Alam 30/06/2019 Office Space: 1000 Sft Advance: 50,000/- Rent: Tk9,000 / Sylhet (Metro) West World Sopping City (8th Floor) Zollarpar Road, Zindabazar,Sylhet Mofik Ahmed Choudhury 16/07/2019 Office Space: 870 Sft Advance: 65,000/- Rent: Tk13,000 / Wasa (Metro) Thakurgaon (Metro) Maheshkhali (Metro) B -Baria (Metro) M.B Complex (3rd floor) Holding No -90,High Seven Road,Lalkhan Bazar P.O:- Dam para P.S.Khulshi Dist : Chittagong Holding no-512naresh Chanhan road Thakurgaon Sadar P S + Dist : Thakurgaon Vill: Gorakgata Ekram Building P.O : Gorakgata P.S.:Maheshkhali Dist : Cox'sBazar F.C Tower (3th Floor) Court Road, Brahmanbaria Sadat Amin Mahmud 28/02/2020 Rashida Begum 30/11/2019 Sahab Uddin 31/01/2021 Md Arif Iqbal 31/12/2019 Office Space: 700 Sft Advance: 1,40,000/- Rent: Tk13,000 /- Office Space: 1400 Sft Advance: 27,000/- Rent: Tk9,000 /- Office Space: 840 Sft Advance: 60,000/- Rent: Tk5,000 /- Office Space: 1800 Sft Advance: 72,000/- Rent: Tk24,000 / Monohorgonj Bazar Monohorgonj Bazar P.O + P.S :Monohorgonj Dist: Comilla. Moniruzzaman Chowdhuary 28/02/2020 Office Space: 100 Sft Advance: 3,000/- Rent: Tk 3,000 / Barisal (Metro) Laldighi (Metro 109 Sadar Road (4th Floor) P.O. : Barisal Sadar P.S : Kotwali Model Dist : Barisal. Gazi Tower (2nd Floor) 47 Laldighi, P.O ; Sada P.S : Kotowali Dist : Chittagong. S.K MD MUSA & SK. MD IDRIS Mohammad Saifullah 30/04/ /03/2019 Office Space: 1000 Sft Advance: 75,000/- Rent: Tk25,000 /- Office Space: 660 Sft Advance: 50,000/- Rent: Tk12,000 / Pirojpur (Metro) Vill : Charakhali P.O. + P.S : Indurkani Dist : Pirojpur Md Anayet Hossen 30/09/2019 Office Space: 280 Sft Advance: 10,000/- Rent: Tk1,500 /- 52

63 Keranihat (Metro) Vill + P.O. : Keranihat, P.S.: Satkania Dist : Chittagong. Faridul Alam 30/04/19 Office Space: 1500 Sft Advance: 50,000/- Rent: Tk15,000 / Hathazari (Metro) 1049,Hathazari City Corporation (3rd floor) P.O. + P.S : Hathazari Dist : Chittagong. Ahammed Hossain 31/01/2020 Office Space: 1970 Sft Advance: 53,000/- Rent: Tk15,000 / Taraganj (Metro) Paschim Kursha Dorjipara P.O + P.S :Taraganj Dist: Dinajpur Md. Sonaulla Sarker 30/06/20 Office Space: 800 Sft Advance: 12,000/- Rent: Tk4, Dagonbhuya (Metro) Cox's Bazar Agency (Metro) Kurigram (Metro) 74, "Al - Nur Jame Moszid " Market (3rd Floor) Chowmuhani Road, P.O + P.S: Dagonbhuiyan Dist : Feni. 58, "Al Aksa Shoping Tower Market (2nd Floor) P.O: Chiringa P.S: Chokoria Dist: Cox's bazar. Vill : Goshpara P.O + P.S: Kurigram Sadar Dist : Kurigram Al - Nur Jame Moszid (Mahmudul Huqe) M/S Al Aksa Pvt Ltd (Md Abu Nayyem Azad) 30/06/19 30/06/19 Aklima Khatun 31/10/20 Office Space: 1024 Sft Advance: 60,000/- Rent: Tk10,000 Office Space: 1050 Sft Advance: 50,000/- Rent: Tk10,000 Office Space: 875 Sft Advance: 15,000/- Rent: Tk5, Mirpur (Metro) Fair Plaza Plot -C/3 Block -D Road no - 1 P.S.; Shahoali Mirpur -1, Dist : Dhaka. Make Fair & Ltd (On BehalfMd Aga Khan) 31/08/2020 Office Space: 750 Sft Advance: 1,00,000/- Rent: Tk15, Panchagarh (Metro) Fulgazi (Metro) Jhenaidah (Metro) Kanchpur (Metro) Kendua Holding no- 626 Kayatpara P.O: Panchagarh P.S : Panchagarh Sadar Dist: Panchagarh 492, Fulgazi Trade Center ( 2nd Floor) Main Road P.O + P.S : Fulgazi Dist : Feni. House no - 48 Sher -E - Bangla Sarak, P.O. + P.S : Jhenaidah Sada, Dist:Jhenaidah. Senpara Jame Mosjid Shopping Complex (2nd Floor), P.O : Kanchpur, P.S : Sonargaon, Dist : Narayanganj, Vill : Coat road P.O +P.S : Kendua Dist : Netrokona Md Jahangir Alam Jhunu Kamal Uddin Firoz Md Mostafa Md Ibrahim 30/09/ /01/2020 Md.Mohiuddin 30/11/2020 Senpara Jame Mosjid Shopping Complex (Md Abul Khair) Khan Enterprise (Rafiqul Islam Khan) 31/08/ /07/2020 Office Space: 680 Sft Advance: 30,000/- Rent: Tk4,000 Office Space: 667 Sft Advance: 60,000/- Rent: Tk8,000 Office Space: 1003 Sft Advance: 30,000/- Rent: Tk 6,000 Office Space: 800 Sft Advance: 1,00,000/- Rent: Tk 10,000/- Office Space: 240 Sft Advance: Rent: Tk 3,200 /- (viii) Dates of purchase of plant and machineries along with sellers name, address, years of sale, condition when purchased, country of origin and remaining economic life, purchase price and written down value The company has no plant and machineries. (ix) Details of the machineries required to be bought by the issuer, cost of the machineries, name of the suppliers, date of placement of order and the date or expected date of supply, etc. The Companyhas no plan to buy machineries. 53

64 x) In case the machineries are yet to be delivered, the date of quotations relied upon for the cost estimates given shall also be mentioned; There are no such machineries which are yet to be delivered. (x) If plant is purchased in brand new condition then it should be mentioned; SLICL is a life insurance service provider; it has no plant. (xii) Details of the second hand or reconditioned machineries bought or proposed to be bought, if any, including the age of the machineries, balance estimated useful life, etc. as per PSI certificates of the said machineries as submitted to the Commission; The Company has no re-conditioned or second-hand plant & machinery and does not have any future plan to buy reconditioned or second-hand plant & machinery. (xiii) A physical verification report by the issue manager(s) regarding the properties as submitted to the commission; Visited by Physical Verification Report by the issue managers of Sonali Life Insurance Company Limited This is to certify that we have visited the registered office and Extended Head Office of Sonali Life Insurance Company Limited on October 01, Visited and Accompanied by: Particulars Name & Designation Company Md. Sohel Rahman Chief Executive Officer (Additional Charge) : Swapna Roy Senior Executive Officer ICB Capital Management Ltd. : : Irin Perveen Binte Faruque Principal Officer Ahmed Yousuf Abbas Chief Executive Officer Abu Anas Ibne Hoque Senior Principal Officer Agrani Equity & Investment Limited Accompanied by Mir Rashed Bin Aman : Add. MD &Chief Financial Officer Sonali Life Insurance Company Limited Md. Rafe-Uz-Zaman Company Secretary Purpose of visit: SLICL signed an issue management agreementon 01 October,2018with ICB Capital Management Limited (ICML) and Agrani Equity & Investment Limited (AEIL) for listing its shares in the stock exchanges of the country through Initial Public Offering (IPO). In this respect, the management team of ICML& AEIL visited the Extended Head Office and Registered Office as a part of due diligence of issue manager on 01 October, 2018 in order to get the operational status of the company before public issue of shares. Registered Office: The registered office of the Company is located at Rupali Bima Bhaban, 7, Rajuk Avenue, Dhaka Extended Head office: The Extended Head office of the Company is located at 68/B (Level ), Malibagh, Dhaka. Nature of Business: The Company is engaged in the ordinary life insurance, pension and group insurance business since its incorporation. The Company offers a wide variety of life insurance products which fulfils the requirements of present and prospective policyholders of Rural and urban People of Bangladesh. 54

65 Principal products and services: The products and services of the Company are as follows: Sl Principal Products Plan Name 1. General Life Insurance Endowment Assurance Plan With Profits Anticipated Endowment Assurance Plan - 3 Stage With Profits Anticipated Endowment Assurance Plan - 5 Stage With Profits Ordinary Insurance Plan Without Profits Money Back Term Insurance Benefit With Profit Granted Child Protection Assurance Plan with Profits Education Expense Assurance Plan with Profits Ordinary Endowment Insurance With Profits 2. Group Insurance 3. Islami Life Insurance (Takaful) Single Premium Insurance Plan Without Profits Assurance Cum Pension Plan Without Profits Denmohar Bima With Profits Hajj Bima With Profits Monthly Savings Assurance Plan With Profit Monthly Savings Micro Insurance Plan With Profit Endowment Assurance Plan With Profits Anticipated Endowment Assurance Plan - 3 Stage With Profits Anticipated Endowment Assurance Plan - 5 Stage With Profits Child Protection Assurance Plan with Profits Single Premium Insurance Plan Without Profits Assurance Cum Pension Plan Without Profits Denmohar Bima With Profits Hajj Bima With Profits Monthly Savings Assurance Plan With Profit Monthly Savings Micro Insurance Plan With Profit Description of Property: The property of this company is the rented office premises and other fixed assets. We have identified the properties of Sonali Life Insurance Company Ltd. as follows: 1)1400 square feet of floor space for Registered Office situated at Rupali Bima Bhaban7, Rajuk Avenue, and Dhaka This floor space is rented fromsonali Life Insurance Company Limited and per month, rent is BDT. 40, ,015 square feet of floor space of Extended Head Office situated at 68/B, Malibagh, Dhaka. The company possesses the following fixed assets as on June 30, Sl. No. Name of Assets 1 Furniture & fixture 2 Computer hardware 3 Office equipment 4 Electric equipment 5 Motor vehicles 6 Office decoration 7 Telephone installation 8 Signboard 55

66 9 Computer software Both of the offices are well decorated with having modern facilities such as lift, reception and adequate space for the employees.during our visit we found the employees working there.we communicated with several employees of the Company and they expressed their satisfaction about the office environment. We have found a signboard of the Company in front of entrance. During the course of visit, we have found office equipment, furniture & fixtures, electrical equipment and others in the office premises are in good condition. 2) Land: TheCompany has no land under its ownership. 3) Factory Building& Machinery: As SLICL is an insurance service provider, it has no factory building and machineries. It is also mentionable here that during our visit, we also checked Inventory register of Stamps and found satisfactory. Signboard: The signboard of the Company is well displayed at the registered office and Extended Head Office premises and there are no other Office/Factory within the said office premises. Sd/- (Irin Perveen Binte Faruque) Principal Officer Sd/- (Swapna Roy) Senior Executive Officer Sd/- (Md. Sohel Rahman) Chief Executive Officer (Additional Charge) Sd/- (Abu Anas Ibne Hoque) Senior Principal Officer Sd/- (Ahmed Yousuf Abbas) Chief Executive Officer (xiv) If the issuer is entitled to any intellectual property right or intangible asset, full description of the property, whether the same are legally held by the issuer and whether all formalities in this regard have been complied with; The Company does no posses any intellectual property right. It has only an intengible asset Computer Software for doing the business operation, which is properly accounted and reflected in our financial statements and assets schedule according to BAS 38. The company maintaining all formalities in this regard legally holds the computer software. 56

67 (xv) Full description of other properties of the issuer; The details of other properties are stated in the following table (Amount in BDT) Sl. No. Name of Assets Written down value as on 30 June 2018 (as per audited accounts) 1 Furniture & fixture 12,727, Computer hardware 9,067, Office equipment 4,502, Electric equipment 9,238, Motor vehicles 57,574, Office decoration 11,720, Telephone installation 412, Singboard 586, Computer software 41,466, Total 147,295, (f) Plan of Operation and Discussion of Financial Condition: (i) If the issuer has not started its commercial operation, the company s plan of operations for the period which would be required to start commercial operation which shall, among others, include:- a) Projected financial statements up to the year of commercial operation; b) Rationale behind the projection; c) Any expected significant changes in the issuer's policy or business strategies; d) Detail plan of capital investment with break-up; e) Summary of feasibility report, etc. Not Applicable. (ii) If the issuer had been in operation, the issuer s revenue and results from operation, financial position and changes in financial position and cash flows for the last five years or from commercial operation, which is shorter, shall be furnished in tabular form which shall, among others, include the following information: Revenue and results from operation Particulars Income Balance of Fund at the beginning of the year Premium Less Re-Insurance: 30-Jun-2018 ( 6 Months) Amount In Taka 31-Dec Dec Dec Dec Dec ,073,934 57,496, ,272,380 80,922,292 9,865,910 - First Year Premium 228,198, ,335, ,087,531 53,816,499 41,920,525 17,547,242 Renewal Premium 50,074,308 60,306,649 38,544,624 22,453, ,340 - Group Insurance Premium 2,707,627 38,882,907 39,841, ,109, ,663,000 - Gross Premium 280,980, ,524, ,473, ,379, ,166,865 17,547,242 Less: Re-insurance Premium 623,654 1,804, , , ,894 18,467 Net Premium 280,357, ,720, ,658, ,963, ,945,971 17,528,775 Interest, Dividend and Rents 14,096,839 33,060,314 30,748,911 30,422,610 29,781,437 9,395,965 Other Income 443,303 5,759, , ,927 85,940 43,435 Total Income 547,971, ,036, ,053, ,445, ,679,258 26,968,175 57

68 Expediture Particulars Claims Under Policies (Including Provision For Claims due or intimated), less re-insurance: Expense of Management 30-Jun-2018 ( 6 Months) 31-Dec Dec Dec Dec Dec-13 30,054,729 34,570, ,801, ,940,585 33,165,000 - Commissions: Commissio to Insurance agents 29,686,853 42,770,131 26,914,448 25,339,120 23,613,100 7,490,928 Allowances and commissions (Other than commission including in sub-item (a) 17,228,717 19,660,054 11,981,240 8,100,766 6,358,683 2,498,463 preceding) Salaries 25,397,773 51,419,450 42,600,606 21,571,078 16,740,015 4,935,686 Development salaries and allowance 22,665,580 15,420,971 11,122,053 11,197,354 7,840,004 - Development incentive 626,201 1,279, ,766 81,812 72,717 - Travelling and conveyance 82, , , , ,368 34,136 s Fees 156, , , , ,000 Audit Fees 25,000 36,250 27,500 25,000 25,000 25,000 Actuary Fees 1,150, Medical Fees 354, , , ,397 59,490 3,770 Legal and professional fees - 80, ,000 55,750 83,880 - Insurance policy stamp 1,000,000 2,500,000 1,100, , ,000 - Advertisement and promotional expense - 147, ,116 1,231, , ,150 Office Rent 11,182,852 28,080,258 15,239,687 12,305,894 7,493,575 30,000 Printing and Stationary 926,767 4,086,456 1,673, , , ,338 Bank Charges 1,267,564 1,629, , , ,348 - Financial Expenses 319,020 8,557,682 10,719,705 4,427,692-11,484 Brokerage Commission 18,036 13, Foreign currency loss 7,771 25, Repairs and Maintenance 92, , , , , ,662 Service Maintenance 1,007,598 1,148, , , Fuel, Oil Generator 34,125 87,880 55,530 40,524-14,430 Car Fuel, Maintenance & Repairs 56, , , , ,388 - Papers, Periodicals and Books 5,310 85,880 93,250 59,950 48,940 2,690 Telephone, Fax and Internet 726,903 1,341,055 1,247,770 1,587,644 1,054, ,573 Electricity & Utility Expenses 2,180,899 3,512,715 2,660,260 1,858, ,548 75,469 Training and Recruitment Expenses 18,000 8, , ,734 13,853 - Particulars 30-Jun-2018 ( 6 Months) 31-Dec Dec Dec Dec Dec-13 Entertainment 583, , , , ,801 75,776 Insurance premium (General) 228, , , , ,710 - Postage and Courier 196, , , ,049 51,963 3,465 Business Development Expenses 331,768 2,833,029 1,475,462 1,912,781 1,001,473-58

69 Prizes and Awards 72, , , ,630 15,000 - Company Registration (Renewal) Fees - 786,781 1,133, ,084 75,436 Stamps & Forms 30,000 62,790 27,285 50,240 43,264 13,815 Fees, Subscriptions and Donation 330,000 2,065,228 1,032, , ,658 - Meeting, Seminar & Symposium 398,900 1,624,527 1,544, ,011 73,637 99,021 Uniform 241,500 36,230 5, Conference - 481, Written Off pre-incorporation expense - 2,123, Fair Expense ,040 Reserve for unexpired risk - - 5,270,007 Refreshment & Recreation 7,371,919 2,090, ,330-9,378 Provision for Commission expense for outstanding premium - 857, , , Provision for change in value of investment in shares ,349,672 84,160 - Depreciation on Fixed Asset 10,356,646 15,611,008 17,529,877 11,394,902 7,303, ,991 Balance of Fund at the end of the period/year 381,799, ,073,934 57,496, ,272,380 80,922,292 9,865,910 Total 547,971, ,036, ,053, ,445, ,679,258 26,968,175 Statement Of Finanacial Position Capital and Liabilities Shareholders' Equity Particulars 30-Jun Dec Dec Dec Dec Dec-13 Authorised Capital: 100,000,000 ordinary shares of Tk. 10 each 1,000,000,000 1,000,000,000 1,000,000,000 1,000,000,000 1,000,000,000 1,000,000,000 Issued Subscribed And Paid-Up 28,500,000 ordinary shares of Tk. 10 each fully paid up in cash 285,000, ,000, ,000, ,000, ,000, ,000,000 Statutory deposit by the shareholders Balance Of Funds And Accounts Life Insurance Fund 15,000,000 15,000,000 15,000,000 15,000,000 15,000,000 15,000, ,799, ,073,934 57,496, ,272,380 80,922,292 9,865,910 59

70 Particulars LIABILITIES AND PROVISIONS Estimated Liabilities in respect of outstanding claims, whether due or intimated Amount due to other persons or bodies carrying on insurance business Sundry Creditors Lease Finance Reserve for unexpired risk 30-Jun-2018 ( 6 Months) 31-Dec Dec Dec Dec Dec-13 23,074,350 39,601,500 46,266,000 13,820,000 13,800, ,846-22,876 95,418 49,853 9,234 10,322,022 80,960, ,470,124 80,489,150 33,281,514 18,324, ,747,202 4,361, ,270, Premium Deposits 226, , , , ,458 88,081 Provision for share value fluctuation account - - 1,290,469 10,433,832 84,160 - TOTAL EQUITY AND LIABILITIES 715,899, ,871, ,959, ,008, ,657, ,287,276 PROPERTY AND ASSETS INVESTMENT (AT COST) Statutory deposit with Bangladesh Bank 15,000,000 15,000,000 15,000,000 15,000,000 15,000,000 15,000,000 Share listed on stock exchange 16,066, ,301,380 13,946,542 - Bangladesh Govt. Treasury Bond 33,800,000 33,800,000 28,800, Other Investment Outstanding Premium 76,321,227 67,941,949 38,171,551 23,925,329-19,972,699 19,325,713 11,872,647 5,813,187 1,037,186 1,079,361 Interest, Dividends And Rents Accruing but not due 30,393,981 24,813,171 15,631,740 8,300,427 3,392,332 1,404,000 Advances, Deposits and Sundry Debtors 25,462,867 26,683,258 17,581,180 13,068,086 7,316,855 3,057,835 Pre-incorporation expense - - 2,123,525 2,123,525 2,123,525 2,123,525 CASH AND OTHER BANK BALANCES Fixed deposits with Banks and Financial Institutes 223,760, ,260, ,500, ,700, ,900, ,000,000 Short term deposit with Banks 124,148,499 54,641,468 11,766,421 5,529,326 3,480, ,209 Current Account with Banks 781, , , ,560 7,920 12,290 Savings Account with Banks 454,709 8,786,186 6,412 6,727 11,667 - Cash in hand OTHER ACCOUNTS 2,364, ,847 1,782,108 1,351, , ,488 Stamps, Printing and Stationary in hand 78,562 84,567 41, ,239 28, ,766 Fixed Assets 105,829,516 73,819,320 45,403,326 38,713,066 25,683,557 10,862,791 60

71 Intangible Assets 41,466,010 21,003,255 27,639,134 36,304,873 14,068,178 8,720,010 TOTAL ASSETS 715,899, ,871, ,959, ,008, ,657, ,287,276 CASH FLOW STATEMENT AS FOLLOWS Particular Cash flow from operating activities 30-Jun-18 (6 Months) 31-Dec Dec Dec Dec Dec-13 Collection from premium 279,700, ,570, ,592, ,180, ,057,523 16,537,494 Other Income 443, , , ,927 85,940 18,367,486 Payment for Claims (46,581,879) (13,950,194) (76,355,233) (126,920,585) (19,365,000) - Payment for management expense, commission, reinsurance and others (167,603,481) (112,470,596) (106,854,348) (58,210,128) (53,733,325) (20,125,641) Tax Paid (571,343) Interest, Dividends and Rents received 8,516,029 6,489,998 23,417,598 25,514,515 27,793,105 7,991,965 Net cash flow from operating activities 73,903,591 (2,155,764) 29,174,007 46,186,689 78,045,138 14,779,339 Cash flow from investing activities Acquisition of Fixed assets (89,349,597) (9,232,700) (15,554,398) (46,661,107) (27,472,428) (20,006,792) Pre-incorporation expense (2,123,525) Other Investment (23,463,371) - 35,301,380 (23,925,329) - Statutory deposit to Bangladesh Bank (15,000,000) Investment In shares (982,198) - (14,246,221) (21,354,838) (13,946,542) - Bangladesh Govt. Treasury Bond (BGTB) - (9,402,151) (28,800,000) - Net cash flows from financing activities (113,795,166) (18,634,851) (23,299,239) (66,426,760) (13,625,865) (29,138,352) Cash Flows From Financing Activities Shareholders Security (BGTB) ,000,000 Capital Introduced 105,000, ,000,000 Net cash flows from financing activities 105,000, ,000,000 Net increase/ (decrease) in cash and cash equivalents Cash and cash equivalents at the beginning of the year Cash and cash equivalents at the end of the year 65,108,425 (20,790,615) 5,874,768 (20,240,071) 64,419, ,640, ,400, ,694, ,820, ,060, ,640, ,508, ,904, ,694, ,820, ,060, ,640,987 Changes in financial position 61

72 Particular 30-Jun Dec Dec Dec Dec Dec-13 Share Capital- paid up 285,000, ,000, ,000, ,000, ,000, ,000, Balance Of Life Fund 381,799, ,073, ,496, ,272, ,922, ,865, a) Internal and external sources of cash; Particulars (Amount in BDT) Internal Source of Cash Share Capital* 285,000, ,000, ,000, ,000, ,000, ,000,000 Life Insurance Fund 381,799, ,073,934 57,496, ,272,380 80,922,292 9,865,910 Sub Total: 666,799, ,073, ,496, ,272, ,922, ,865,910 External source of Cash Premium Deposit 280,357, ,720, ,658, ,963, ,945,971 17,528,775 Sub Total: 280,357, ,720, ,658, ,963, ,945,971 17,528,775 Grand Total : 947,156, ,794, ,155, ,235, ,868, ,394,685 *Cash Received against capital raised after Balance Sheet date (As per return submitted to RJSC dated (09/06/2018) for an amount of TK. 105,000,000 within the existing shareholders/sponsors /directors. (b) Any material commitments for capital expenditure and expected sources of funds for such expenditure; SLICL has no other material commitments for capital expenditures. (C) Causes for any material changes from period to period in revenues, cost of goods sold, other operating expenses and net income; We have used the accounting heads according to our Audited accounts to represent the changes mentioned in the above clause. Amount in Taka 30-Jun- Particular Dec Dec Dec Dec Dec-13 (6 months) Gross Premium 280,980, ,524, ,473, ,379, ,166,865 17,547,242 Year to year changes in gross premium -31% 108% -17% 56% 761% N/A Net Premium 280,357, ,720, ,658, ,963, ,945,971 17,528,775 Year to year changes in Net premium -30% 108% -17% 56% 761% N/A Other Income 443,303 5,759, , ,927 85,940 43,435 Year to year changes in Other Income -92% 1441% 72%% 59% 97% N/A Operating Expense 76,970,299 97,000, ,696, ,380,471 63,136,783 9,989,391 Year to year changes in Operating Expense -21% -34% -8% 154% 532% N/A Management Expense 89,201, ,962, ,859,805 84,792,593 46,620,183 7,112,874 Year to year changes in management expense -41% 24% 45% 81% 555% N/A Balance Of Life Fund 381,799, ,073,934 57,496, ,272,380 80,922,292 9,865,910 Year to year changes in Balance of life fund 51% 340% -43% 26% 720% N/A Causes for changes in year to year changes in revenue (%) Not applicable 62

73 Causes for changes in COGS to revenue (%) Not applicable Causes for changes in Gross premium (%) Due to changes in marketing policy and undertaking of sone new visions for improving our business, volume of premium collection increasecd subsequently which affected the gross premium during the period. Causes for changes in Net Premium (%) As net premium is calculated after deducting re-insurance charge from gross premium, due to change in re-insurance charge amount, net premium was also veried from period to period. Causes for changes in operating expenses (%) Due to increase business volume, agency commission was also increased and claims were settled. As a result operating expense was also increased period to period. Causes for changes in Management expenses (%) Due to increase business volume, management expenses also increased. As a result financial expense was also increased period to period Causes for changes in Other Income (%) Due to change in interest rate, interest income was changed during the period. Other income comprised of late fees,sale of proposal form and crockeries etc. which were also varied period to period. The company included Provissin for un-expired risk reserve in the other income which is the reason for sudden change in other income percentage in the year of Causes for changes in Balance of life fund (%) Due to increase business volume, decrease management expense and increase investment income, Balance of life fund was also increased period to period. (d) Any seasonal aspects of the issuer s business; There is no significant seasonal aspect on the Company s business. (e) Any known trends, events or uncertainties that may have material effect on the issuer s future business; There are no known trends, events or uncertainties that may affect on the future business of the Companyexcept followings: 1. Changes in government policy 2. Political unrest situation 3. Natural calamities. (f) Any assets of the Company used to pay off any liabilities; No assets of the Company have been used to payoff any liabilities of the Company from the inception to till 30 June, (g) Any loan taken from or given to any related party or connected person of the issuer with details of the same; No loan has been taken from or given to any related party or connected person of the Company. (h) Any future contractual liabilities the issuer may enter into within next one year, and the impact, if any, on the financial fundamentals of the issuer; The Companyhas no plan to enter into any future contractual liability within next one year except normal course of business. 63

74 (i) The estimated amount, where applicable, of future capital expenditure; The Companydoes not have any plan for capital expenditure in near future other than disclosed in section XXIIunder the head of Use of Proceeds. (j) Any VAT, income tax, customs duty or other tax liability which is yet to be paid, including any contingent liabilities stating why the same was not paid prior to the issuance of the prospectus. Updated income tax status for the last 5 years or from commercial operation, which is shorter; VAT The Company has VAT registration number The company does not have to pay VAT on its regular life insurance business. However, it has outstanding amounting to TK. 125,483, which has arisen due to deduction from various suppliers bills, and full amount has subsequently been deposited to the government treasury after the balance sheet date. Income tax Income Tax liability is created on the basis of surplus of Actuarial Valuation Report as per 4 th schedule 2b method of Income tax ordinance The company has submitted tax return for the five years from the accounting year 2013 to Accounting Year Assessment Year Status TAX return has submitted to LTU and Assessment is under process Contingent Liability The company has no contingent liability for the last five years. (k) Any financial commitment, including lease commitment, the Company had entered into during the past five years or from commercial operation, which is shorter, giving details as to how the liquidation was or is to be effected; Sonali Life Insurance Company does not have any financial commitment during the last five years except following finance lease agreement: Particulars Lease Agreement for Head Office Lessor South Bangla Agriculture & Commerce Bank Ltd. Lessee Sonali Life Insurance Company Limited Nature of Agreement Financial Lease agreement Date of Lease Agreement June 11, 2014 Effective Date of Tenancy June 1, 2014 Period of Lease 2 (Two) Years from the 1 st disbursement Date of Lease Expiration May 31, 2016 Description of lease finance Purchase of 5 reconditioned Toyota cars for Head Office. Monthly Installment BDT 2,58,036 per month (l) Details of all personnel related schemes for which the Company has to make provision for in future years; The Company has planned to implement attractive compensation plan and is alsooffering festival bonus for attracting highly skilled professional staff with high degree of integrity, as it considers the human resources as the most valuable assets. In order to enhance and advance the professional ability and Knowledge of the employees, regular training programs are organized. Other Personnel related scheme is given below: Scheme Status 64

75 Festival Bonus : Provident Fund Allowances : Maternity Benefit : Employees are given festival bonus in Eids equivalent to one-month gross salary in a year. To be Introduced According to performance and pay scale, allowances are given for expenses such as house rent, conveyance, medical expense, car maintenance and mobile phone facility. Females Employees are entitled to maternity benefit up to the birth of two children. (m) Break down of all expenses related to the public issue; SL Particulars Rate Amount in Tk. 1 Manager to the issue fees 1% of the public offering amount(including premium) 1,900, VAT against Issue Management 15% on the Issue Management Fee 285, Listing Related Expenses: Application Fee for Stock Exchanges Tk. 50,000 for each exchanges 100, % on Tk. 100 million of paid-up capital and 0.15% on the rest amount of paid-up Listing Fee for DSE & CSE 2 capital; minimum Tk. 50,000 and Maximum 1,625, Tk. 10 milion for each exchanges Annual Fee for Stock Exchanges 0.05% on BDT 100 million of paid-up capital and 0.02% on the rest amount of paid-up capital; minimum BDT 50,000 and Maximum 250, BDT 6 lacs for each Exchange 3 BSEC Fees Application Fee Tk. 50,000 (non-refundable) 50, Consent Fee 0.40% on the public offering amount 760, IPO Commission/Expenses: 4 Underwriting Commission 0.50% on the underwritten amount 332, Credit Rating Fee At actual 80, Auditors' Certification Fee At actual 500, CDBL Fees and Expenses: Security Deposit of Eligible Securities Having paid-up capital upto Tk. 50 crore 400, Documentation Fee At actual 2, Annual Fee Having paid-up capital above Tk. 20 crore 100, Connection Fee At actual 6, IPO Fees 0.015% of IPO size+0.015% of Pre-IPO paid up capital 71, Printing, Publication and Others: Publication of Prospectus Estimated 800,000 7 Abridged version of Prospectus and Notice in 4 daily newspaper Estimated 900,000 Notice for Prospectus, Lottery, Refund etc. in Estimated 300,000 4 daily newspaper 65

76 SL Particulars Rate Amount in Tk. Lottery Conducting Expenses & BUET Fee Estimated 1,000,000 Data Processing and Share Software Charge Estimated 2,000,000 Courier expenses Estimated 300,000 Stationeries and Other Expenses Estimated 250,000 Total 12,012, NB: The cost of the above mentioned IPO expenses may vary and will be adjusted accordingly (n) If the issuer has revalued any of its assets, the name, qualification and experiences of the valuer and the reason for the revaluation, showing the value of the assets prior to the revaluation separately for each asset revalued in a manner which shall facilitate comparison between the historical value and the amount after revaluation and giving a summary of the valuation report along with basis of pricing and certificates required under the revaluation guideline of the Commission; No assets of the issuer have been revaluated till 30 June, (o) Where the issuer is a holding or subsidiary Company, full disclosure about the transactions, including its nature and amount, between the issuer and its subsidiary or holding Company, including transactions which had taken place within the last five years of the issuance of the prospectus or since the date of incorporation of the issuer, whichever is later, clearly indicating whether the issuer is a debtor or a creditor; The Company has no holding/subsidiary Company. Therefore, no transaction was occurred in this regard. (p) Financial Information of Group Companies and Companies under common ownership by more than 50%: following information for the last three years based on the audited financial statements, in respect of all the group companies of the issuer, wherever applicable, along with significant notes of auditors: (1) Date of Incorporation; (2) Nature of Business; (3) Equity Capital; (4) Reserves; (5) Sales; (6) Profit after tax; (7) Earnings per share and Diluted Earnings Per Share; (8) Net Asset Value; (9) The highest and lowest market price of shares during the preceding six months with disclosures for changes in capital structure during the period, if any securities of the group are listed with any exchange; (10) Information regarding significant adverse factors relating to the group; (11) Any of the group companies has become sick or is under winding up; (12) The related business transactions within the group and their significance on the financial performance of the issuer; (13) Sales or purchase between group companies or subsidiaries or associate companies when such sales or purchases exceed in value in the aggregate ten per cent of the total sales or purchases of the issuer and also material items of income or expenditure arising out of such transactions; Sonali Life Insurance Company does not have any operating relation with any group of companies. 66

77 (q) Where the issuer is a banking company, insurance company, non-banking financial institution or any other company which is regulated and licensed by another primary regulator, a declaration by the board of directors shall be included in the Prospectus stating that all requirements of the relevant laws and regulatory requirements of its primary regulator have been adhered to by the issuer Dated: 15 September To whom it may concern All requirements of the relevant laws and regulatory requirements of its primary regulator have been adhered to by the issuer. Declared by the Board of s of Sonali Life Insurance Company Limited: Sd/- Mrs. Noor-e-Hafza Chairman Sd/- Mrs. Shafia Sobhan Chowdhury Sd/- Mrs. Maya Rani Roy Sd/- Mr. Ahmed Rajeeb Samdani Sd/- Honufa Akter Rikta Independent Sd/- Mrs.Fauzia Quamrun Tania Vice chairman Sd/- Mr. Sheikh Mohammed Danial Sd/- Mr. Sheikh Omar Faruque Sd/- Mrs. Hazera Hossain Sd/- Quazi Moniruzzaman Independent Sd/- K. M. Farookh Nominee of Rupali Insurance Company Ltd. Sd/- Mrs. Kamrun Nahar Sd/- Mr. Omar Khayum Sd/- Mrs. Hoda Ali Selim Sd/- Md. Nurun Nabi Independent (r) A report from the auditors regarding any allotment of shares to any person for any consideration otherwise than cash along with relationship of that person with the issuer and rationale of issue price of the shares; This is to certify that Sonali Life Insurance Company Limited has not allotted any shares for consideration other than in cash to any person up to 30 June D ate: 6 August 2018 Place: Dhaka Sd/- Ahmad Akhtar CharteredAccountants (s) Any material information, which is likely to have an impact on the offering or change the terms and conditions under which the offer has been made to the public Other than information disclosed in this prospectus, there is no material information, which is likely to have an impact on the offering or changes in the terms and conditions under which the offer has been made to the public. 67

78 (t) Business strategies and future plans - projected financial statements shall be required only for companies not startedcommercial operation yet and authenticated by Chairman,two s, Managing, CFO, and CompanySecretary: Business Strategies SLICL s key strategic objectives The Company s strategic objective is to improve and consolidate its position in the insurance industry with a continuous growth philosophy. The major focus of the Company is to enhance value creation through delivering insurance product to wide range of clients. In order to achieve the objective the Company has been adopted the following strategies: Marketing strategy Emphasize service and support. Increase market share. Reinforce a market image as the finest service provider in the industry. Forecast customer needs Financial strategy Focusing on profit. Maintaining transparency and integrity on financial transaction. Focusing on controlling of cost. Budgeting and variance analysis Financial risk analysis Operational excellence strategy The reality of the insurance industry is that the service is the product. With this important fact recognized, the Company strives to provide the highest level of customer service. The Company has been continued to invest in operational excellence throughout the organization. The Company is addressing operational excellence through continuous process improvement, customer service and technology development. Alignment of its people to process improvement through change management and upgrading of skills as required for customer satisfaction is a continuous activity. Awareness of this quality commitment is widespread among all the employees. Strategy for business competiveness Sonali Life Insurance Company Limited has been driven by client need for reducing business risk. By satisfying client demand on time and proper service, it has gained on competitive advantage over the others competitors. Human capital strategy The Company considers personnel as key resources. Therefore, we are continually working to preserve, encourage and develop the people to perform at their highest potential. Future plan In persuasion of aforesaid Strategies of Sonali Life Insurance Company Limited has been set forth the following plan to be implemented in future: Expansion of business Development of human resourses New product development Broaden marketing base Enhance a client base Adopt new technology 68

79 Focusing on long term financial benefit of the Company. Accordingly the net proceeds from Initial Public Offering (IPO) will be used for as described in section-xxii under the head Use of Proceeds. Pricing strategy Our customers are especially sensitive to value. We must ensure that our price and service are perceived to be good value to our client. (u) Discussion on the results of operations shall inter-alia contain the following (1) A summary of the past financial results after adjustments as given in the auditor s report containing significant items of income and expenditure There was no significant adjustment given in the auditor s report containing significant items of income and expenditure during the last financial year. Summary of the financial results and operations are presented below: Amount in Taka Year ended Particulars 30-Jun Dec Dec Dec Dec Dec-13 Non-Current Assets 502,287, ,909, ,514, ,582, ,598,277 14,582,801 Current Assets 212,296, ,962,402 61,445,799 36,425,414 18,058,972 8,704,474 Total Assets 714,583, ,871, ,959, ,008, ,657,249 23,287,275 Shareholders' Equity 285,000, ,000, ,000, ,000, ,000, ,000,000 Current Liabilities & Provisions Life Revenue Fund Gross premium 34,100, ,483, ,980, ,797, ,463, ,735,922 51,734, ,073,934 57,496, ,272, ,524, ,473, ,379,931 18,421,366 80,922, , ,166,865 17,547,242 Net premium 280,357, ,720, ,658, ,963, ,945,971 17,528,775 Other income 443,303 5,759, , ,927 85,940 43,435, (2) A summary of major items of income and expenditure Major items of Income Particulars 30-Jun-18 ( 6 months) Year ended 31-Dec Dec Dec Dec Dec-14 Net Premium 280,357, ,720, ,658, ,963, ,945,971 17,528,775 Other Income 443,303 5,759, , ,927 85,940 43,435 Major items of expenditure Particulars 30-Jun-18 ( 6 months) Period ended 31-Dec Dec Dec Dec Dec-14 Operating expenses 76,970,299 97,000, ,696, ,380,471 63,136,783 9,989,391 Management Expense 89,201, ,962, ,859,805 84,792,593 46,620,183 7,112,874 *Operating expense comprised of commission and Claims under policies 69

80 (3) The income and sales on account of major products orservices Particulars 2018 (6 Months) Gross Premium Percentage (%) Gross Premium Percentage (%) Gross Premium Percentage (%) Gross Premium Percentage (%) Gross Premium Percentage (%) Gross Premium Percentage (%) Ordinary Life 273,320,398 97% 361,719,478 89% 152,139,774 78% 73,791,768 31% 41,492,355 27% 17,547, % Takaful 4,952,902 2% 6,922,200 2% 3,492,381 2% 2,478,346 1% 1,011,510 1% - Group Insurance Premium 2,707,627 1% 38,882,907 10% 39,841,328 20% 160,109,817 68% 108,663,000 72% - Total 280,980, % 407,524, % 195,473, % 236,379, % 151,166, % 17,547, % (4) In case, other income constitutes more than 10% of the total income, the breakup of the same along with the nature of the income, i.e., recurring or non-recurring There was no such other income that constitutes 10% or more of the total income. (5) If a material part of the income is dependent upon a single customer or a few major customers, disclosure of this fact along with relevant data. Similarly if any foreign customer constitutes a significant portion of the issu er s business, disclosure of the fact along with its impact on the business considering exchange rate fluctuations The Company has no material part of incomedependent upon a single customer or a few major customers. (6) In case the issuer has followed any unorthodox procedure for recording sales and revenues, its impact shall be analyzed and disclosed. The Company SLICL has not followed any unorthodox procedure for recording of sales and revenues. (v) Comparison of recent financial year with the previous financial years on the major heads of the profit and loss statement, including an analysis of reasons for the changes in significant items of income and expenditure.particular 30-Jun-2018 (6 months) 31-Dec Dec Dec Dec Dec-13 Gross Premium 280,980, ,524, ,473, ,379, ,166,865 17,547,242 Year to year changes in gross premium -31% 108% -17% 56% 761% N/A Net Premium 280,357, ,720, ,658, ,963, ,945,971 17,528,775 Year to year changes in Net premium -30% 108% -17% 56% 761% N/A Other Income 443,303 5,759, , ,927 85,940 43,435 Year to year changes in Other Income -92% 1441% 72%% 59% 97% N/A Operating Expense 76,970,299 97,000, ,696, ,380,471 63,136,783 9,989,391 Year to year changes in Operating Expense -21% -34% -8% 154% 532% N/A Management Expense 89,201, ,962, ,859,805 84,792,593 46,620,183 7,112,874 Year to year changes in management expense -41% 24% 45% 81% 555% N/A Balance Of Life Fund 381,799, ,073,934 57,496, ,272,380 80,922,292 9,865,910 Year to year changes in Balance of life fund Causes for changes in year to year changes in revenue (%) Not applicable 51% 340% -43% 26% 720% N/A 70

81 Causes for changes in COGS to revenue (%) Not applicable Causes for changes in Gross premium (%) Due to changes in marketing policy and undertaking of sone new visions for improving our business, volume of premium collection increasecd subsequently which affected the gross premium during the period. Causes for changes in Net Premium (%) As net premium is calculated after deducting re-insurance charge from gross premium, due to change in re-insurance charge amount, net premium was also veried from period to period. Causes for changes in operating expenses (%) Due to increase business volume, agency commission was also increased and claims were settled. As a result operating expense was also increased period to period. Causes for changes in Management expenses (%) Due to increase business volume, management expenses also increased. As a result financial expense was also increased period to period Causes for changes in Other Income (%) Due to change in interest rate, interest income was changed during the period. Other income comprised of late fees, sale of proposal form and crockeries etc. which were also varied period to period. The company included Provissin for un-expired risk reserve in the other income which is the reason for sudden change in other income percentage in the year of Causes for changes in Balance of life fund (%) Due to increase business volume, decrease management expense and increase investment income, Balance of life fund was also increased period to period. Analysis of reasons for the changes in significant items of income and expenditure: (1) Unusual or infrequent events or transactions including unusual trends on account of business activity, unusual items of income, change of accounting policies and discretionary reduction of expenses etc. There have been no transactions or events in the past which was considered unusual or infrequent. Changes in accounting policies There is no change(s) in the accounting policies of the Company during last five years. (2) Significant economic changes that materially affect or are likely to affect income from continuing operations There are no significant economic changes that materially affect or are likely to affect income from continuing operations. (3) Known trends or uncertainties that have had or are expected to have a material adverse impact on sales, revenue or income from continuing operations Other than matters as described in the Risk Factors and Plan of operation and discussion of Financial Conditions of this prospectus, there are no known trends or uncertainties that have had or areexpected to have a material adverse impact on Premium income of the Companyfrom continuing operations. (4) Future changes in relationship between costs and revenues, in case of events such as future increase in labor or material costs or prices that will cause a material change are known; Any event such as increase in labor or material costs or prices will not affect the operational result of the Company. Therefore, with the passages of time, number ofpolicies and amount of net premiumsare also expected to increase in normal course of operation and for introduction of new products or services. 71

82 (5) The extent to which material increases in net sales or revenue are due to increased sales volume, introduction of new products or services or increased sales prices. Increases in revenues are by and large linked to increases in volume of business activity carried out as a normal course of business. There are no such material increases in net sales or revenue are due to increased sales volume, introduction of new products or services or increased sales prices. (6) Total turnover of each major industry segment in which the issuer operated; Considering the business nature of SLIC, the Company is assumed to operate in insurance industry as life sector. The turnover is considered here as premium income as nature of turnover in insurance industry is different compared to other industry s turnover. According to Bangladesh Insurance Association, the total premium income (total turnover) of life insurance companies is Taka in billion Year Total turnover (Total premium income) 2016 Tk Tk Tk Tk Tk Tk Tk (7) Status of any publicly announced new products or business segment; There are no publicly announced new products or business segment of the company. (8) The extent to which the business is seasonal; The business of the Company is not dependent on any seasonal aspects. (w) Defaults or rescheduling of borrowings with financial institutions or banks, conversion of loans into equity along with reasons thereof, lock out, strikes and reasons for the same etc. during the history of operation of the company: There is no history of defaults or rescheduling of borrowings with financial institutions/banks, conversion of loans into equ ity, lock out, strikes etc. (x) Details regarding the changes in the activities of the issuer during the last five years which may had a material effect on the profits or loss, including discontinuance of lines of business, loss of agencies or markets and similar factors; There is no change in the activities of SLIC during the last five years which may had a material effect on the profits/loss, including discontinuance of lines of business, loss of agencies or markets and similar factors. (y) Injunction or restraining order, if any, with possible implications; There was no injunction or restraining order from any Court of Law or competent authority during the entire life of the Company s business. 72

83 (z) Technology, market, managerial competence and capacity built-up Technology The Company SLIC has maintained up to date technology at their both head office and branch offices. All the computers are connected through LAN. There are available broad band internet connections as well as wifi connectivity with every computer. The Company is using latest version of software in its official works. The office premises is under covered by CCTVfor security purpose. There are sufficient numbers of intercom, fax, photocopy machine, priner machine etc for supporting the management for their official work. Market Insurance sector of Bangladesh is not properly developed and it is fragmented also. Cost of service and competition in distribution is also high. Despite the challenges, this sector has potentiality due to rate of penetration is high. Contribution GDP by premium income is also very low and it is only 0.43%. There are 32 life Insurance Companies are operating in this sector. Though the completion is high, but demand for insurance service is rising day by day due to business scope is increasing to minimize risk. Bangladesh is a developing country which GDP growth rate is approximately 6.5% to 7.0%. The insurance sector has huge potentiality to be developed in this country due to our economic development.the market size for insurance service has been increasing over the past one decade due to business opportunity and scope is also expanding in our country. Bangladesh has a large market for the insurance business.asindustry grows, the demand for skilled professio nals will rise. The rise of the industry shall also create positive impact for creating employment opportunity. Managerial competence The existing management is competent enough to run the business operation. The management team has proven track record to run large organization and vast experience to minimize the operational risk. The management also appointed such personnel who are capable enough to operate the business effectively and efficiently. Even though any experienced personnel leave the organization, others have adequate expertise and skills to run the operation. Capacities build up The Company enhanced its capacity in respect of capital, business and human resources over the year since incorporation. Initially the paid up capital was Tk 18 crore at the time of starting the business. Now as on 30 June 2018, the paid up capital is BDT 28.5 crore. In the same period business volume of the Company and capacity of human resources has also increased significantly. It is expected that, after rising of paid up capital business scope will be increased more. (aa) Changes in accounting policies in the last three years There is no change(s) in the accounting policies of the Company during last three years. 73

84 (bb) Significant developments subsequent to the last financial year: A statement by the directors whether in their opinion there have arisen any circumstances since the date of the last financial statements as disclosed in the Prospectus and which materially and adversely affect or is likely to affect the trading or profitability of the issuer, or the value of its assets, or its ability to pay its liabilities within the next twelve months; Statement by the directors whether there have arisen any circumstances since the date of the last financial statements which materially and adversely affect the trading or profitability of the issuer, or the value of its assets, or its ability within the next twelv e months; Declaration regarding significant developments subsequent to the last financial year This is to certify that in our opinion and to the best of our knowledge there has not arisen any circumstances since the date o f the last financial statements as disclosed in thisprospectus and which materially and adversely affect or is likely to affect the trading or profitability of Sonali Life Insurance Company Limited or the value of its assets, or its ability to pay its liabilities within the next twelve months. Sd/- Mrs. Noor-e-Hafza Chairman Sd/- Mrs. Shafia Sobhan Chowdhury Sd/- Mrs. Maya Rani Roy Sd/- Mrs.Fauzia Quamrun Tania Vice chairman Sd/- Mr. Sheikh Mohammed Danial Sd/- Mr. Sheikh Omar Faruque Sd/- K. M. Farookh Nominee of Rupali Insurance Company Ltd. Sd/- Mrs. Kamrun Nahar Sd/- Mr. Omar Khayum Sd/- Mr. Ahmed Rajeeb Samdani Sd/- Honufa Akter Rikta Independent Sd/- Mrs. Hazera Hossain Sd/- Quazi Moniruzzaman Independent Sd/- Mrs. Hoda Ali Selim Sd/- Md. Nurun Nabi Independent (cc) If any quarter of the financial year of the issuer ends after the period ended in the audited financial statements as disclosed in the prospectus or information memorandum, unaudited financial statements for each of the said quarters duly authenticated by the CEO and CFO of the issuer or information memorandum, unaudited financial statements for each of the said quarters duly authenticated by the CEO and CFO of the issuer; The audited financial statements of the Company for period ended on 30 June, 2018 (Half yearly) has been disclosed in the prospectus.the 2nd quarterly unaudited financial statements of the Company, i.e, 1 July 2018 to 31 December 2018 will be submitted as per requirement of the Bangladesh Securities and Exchnage Commission (Public Issue) Rules, 2015 in due course. (dd) Factors that may affect the results of operations; There are no factors that may affect the results of operations except followings Govt. Policy change pertaining to this industry; Political unrest; Natural calamities etc. 74

85 CHAPTER VII: OPERATIONS MANAGEMENT S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF a) Overview of business and strategies: Overview of business: The Company was incorporated on 7th July 2013 under the Companies Act 1994 as a public company limited by shares for carrying out life insurance business and was granted Certificate of Commencement of business on 7th July 2013.The Company obtained the Certificate of Registration from the Insurance Development and Regulatory Authority (IDRA) on July 30, 2013 under Insurance Act The company is engaged in life insurance business and has no subsidiary. The information in respect of its business operation: Since its establishment on 7th July 2013 the company has within a short span of time established itself as one of the most reputed and trustworthy life insurance companies in private sector of the country. Selective customer service, underwriting of liabilities and prompt settlement of claims have contributed towards building up a very respectable image of the company within the business community. Together with utmost transparency and customer service orientation, it has implemented the country s first fully integrated ERP system based on life insurance which has made its operations and activities streamlined, highly productive, efficient and cost effective. SLICL s Strategies Ensure sustainable growth and modernization of existing facilities with potential for success through increasing life insurance premium. Achieve global competitiveness and to derive the full benefit of our world clas ERP system; Achieve technological superiority; Strengthening financial resources; (b) SWOT analysis: A SWOT analysis is a structured planning method that helps to evaluate the strengths, weaknesses, opportunities and threats involved in a business venture. It identifies the internal and external factors that affect business venture. Strength and Weakness are evaluated with internal factors whereas Opportunity and Threat are evaluated by external factors. The SWOT analysis of the company is as follows: Strengths Experienced Board of s Experienced management Sound financial records Good track record for claim settlement Sound marketing policy No loan liabilities Weaknesses Low market share Enlistment is not wide range A very few advertisement Opportunities Increasing Market Diversified capital structure Branding the Company Iimproving future profitability; 75

86 Threats Huge competition Unhealthy industry policy Tendency of avoidness Low premium rate High rate of re insurance (c) Analysis of the financial statements of last five years with reason(s) of fluctuating revenue or sales, other income, total income, cost of material, finance cost, depreciation and amortization expense, other expense; changes of inventories, net profit before & after tax, EPS etc. Particular 30-Jun-2018 (6 months) 31-Dec Dec Dec Dec Dec-13 Gross Premium 280,980, ,524, ,473, ,379, ,166,865 17,547,242 Year to year changes in gross premium -31% 108% -17% 56% 761% N/A Net Premium 280,357, ,720, ,658, ,963, ,945,971 17,528,775 Year to year changes in Net premium -30% 108% -17% 56% 761% N/A Other Income 443,303 5,759, , ,927 85,940 43,435 Year to year changes in Other Income -92% 1441% 72%% 59% 97% N/A Operating Expense 76,970,299 97,000, ,696, ,380,471 63,136,783 9,989,391 Year to year changes in Operating Expense -21% -34% -8% 154% 532% N/A Depreciation 10,356,646 15,611,008 17,529,877 11,394,902 7,303, ,991 Year to year changes in Depreciation 33% 10% 51% 56% 1622% N/A Inventory 78,562 84,567 41, ,239 28, ,766 Year to year changes in Inventory -7% 103% -93% 2115% -93% N/A Balance Of Life Fund 381,799, ,073,934 57,496, ,272,380 80,922,292 9,865,910 Year to year changes in Balance of life fund 51% 340% -43% 26% 720% N/A Causes for changes in year to year changes in revenue Not applicable Causes for changes in COGS to revenue Not applicable Causes for changes in Gross premium Due to changes in marketing policy and undertaking of sone new visions for improving our business, volume of premium collection increasecd subsequently which affected the gross premium during the period. Causes for changes in Net Premium As net premium is calculated after deducting re-insurance charge from gross premium, due to change in re-insurance charge amount, net premium was also veried from period to period. 76

87 Causes for changes in operating expenses Due to increase business volume, agency commission was also increased and claims were settled. As a result operating expense was also increased period to period. Causes for changes in Depreciation The company purchased a huge amount of fixed asst which stated on the fixed asset schedule of the audit report 31 st December, Causes for changes in Inventory Due to change in marketing policy and business vision for improving documentation, there was some huge purchase of stamps and printing stationary which caused fluctuation in inventory percentage. Causes for changes in Other Income (%) Due to change in interest rate, interest income was changed during the period. Other income comprised of late fees,sale of proposal form and crockeries etc. which were also varied period to period. The company included Provissin for un-expired risk reserve in the other income which is the reason for sudden change in other income percentage in the year of Causes for changes in Balance of life fund Due to increase business volume, decrease management expense and increase investment income, Balance of life fund was also increased period to period. Earnings per Share N/A (d) Known trends demands, commitments, events or uncertainties that is likely to have an effect on the company s business. There are no known trends demands, commitments, events or uncertainties that are likely to have an effect on the Company s business except the followings: Changes in relevant Govt. policies Political unrest Natural calamities (e) Trends or expected fluctuations in liquidity There are no trends or expected fluctuations in liquidity. (f) Off-balance sheet arrangements those have or likely to have a current or future effect on financial condition There are no off-balance sheet arrangements those have or likely to have a current or future effect on financial condition. 77

88 CHAPTER VIII: DIRECTORS AND OFFICERS: (a) Name, Father s name, age, residential address, educational qualification, experience and position of each of the directors of the company and any person nominated or represented to be a director, showing the period for which the nomination has been made and the name of the organization which has nominated him/her; Particulars of s SL # 01 Name of the s Mrs. Noor-E- Hafza Father's name Md. Asaduzzaman Age 64 Residential address Dream Castle, House # 7, Road# 4Gulshan- 1,Dhaka-1212 Educational qualification Experience Position in the company Name of the Institutions and Duration for Nominated M.Sc 36 Chairman - 02 Mrs. Fauzia Qumrun Tania Mostofa Golam Quddus 35 House #2/3, Road#03,Banani, Dhaka-1213 B.Sc (Hon s), M.Sc 11 Vice- Chairman - 03 K.M Farookh (Nominee director of Rupali Insurance Company Ltd.) Abdul Hamid Mazumder - H-Dream Castle, D/1, Holding# 7, Road# 4, Gulshan# 1, Dhaka. B.A 42 Rupali Insurance Company Limited (Sponsor director for 30 years) Mr. Sheikh Mohammed Danial Mrs. Shafia Sobhan Chowdhury Mrs. Kamrun Nahar Mrs. Maya Rani Roy Sheikh Abdul Matin Zafar Ullah Chowdhury Late Sheikh Abdul Khaleque Late Bidhu Bhushan Saha House 4, Road- 06, Khulshi, Chittagong. House-69, Road- 07, Block-F, Banani, Dhaka House#808, Road#24,Block #F,Bashundhara, Dhaka House- 67, Road- 07, Block-F, Banani, Dhaka B.A (Hon s) B.A (Hon s) B.Sc (Hon s) M. A Mr. Sheikh Omar Faruque Ferozur Rahman 46 Yakub nagar, (South jangal) Sultanpur, B- Baria sadar, B- Baria B.A (Hon s) 25-78

89 09 Mr.Omar Khayum Ferozur Rahman 40 My heart Sukrabad, House-8/1, Sukrabad, Dhaka B.A (Hon s) Mr. Ahmed Rajeeb Samdani Enamuzzam Chowdhury 45 House-9, Road- 12, Block-SW(B) Gulshan-1, Dhaka M.A Mrs. Hazera Hossain Mrs. Hoda Ali Selim Honufa Akter Rikta Late Rabi Ullan 39 Ali Selim Ahmed 40 Md. Habibullah Ansari 32 18/ B, East Raza Bazar, Tejgaon, Dhaka 1858, Sarder Ali Lane, Mohammed zaman Road, Mosque Goli, Pachlaish, Chittagong. Bashura, Uttar Padua, Choddogram, Comilla B.A (Hon s) 10 - M.Sc in Computer science LLB (Hon s) Independent - 14 Quazi Miniruzzaman Late Quazi Mohiuddin 65 South Rupsi, rupsi, Rupgonj, Narayanganj B.com 40 Independent - 15 Md. Nurun Nabi Sultan Ahmmed 72 House# 18, Road# 3, Post# Chakbazar, PS# Panchlash, Chittagong. Ph.D 50 Independent - (b) The date on which he first became a director and the date on which his current term of office shall expireship tenure in the Company; Sl. No. Name of the s First date appointment as Date of Expiry of Current Term as director 01 Mrs. Noor-E-Hafza 07 July, th AGM in Mrs. Fauzia Qumrun Tania 07 July, th AGM in K.M Farookh (Nominee director of Rupali Insurance Company Ltd.) 07 July, th AGM in Mr. Sheikh Mohammed Danial 07 July, th AGM in Mrs. Shafia Sobhan Chowdhury 07 July, th AGM in Mrs. Kamrun Nahar 07 July, th AGM in Mrs. Maya Rani Roy 07 July, th AGM in Mr. Sheikh Omar Faruque 07 July, th AGM in Mr.Omar Khayum 07 July, th AGM in Mr. Ahmed Rajeeb Samdani 07 July, th AGM in Mrs. Hazera Hossain 07 July, th AGM in Mrs. Hoda Ali Selim 07 July, th AGM in Honufa Akter Rikta 27 september, th AGM in

90 14 Quazi Miniruzzaman 27 september, th AGM in Md. Nurun Nabi 27 september, th AGM in 2020 (c) If any director has any type of interest in other businesses, names and types of business of such organizations. If any director is also a director of another company or owner or partner of any other concern, the names of such organizations; s interest in other Business Name of the s Position in SLICL ship/sponsorship/ownership with other companies Position held Mrs. Noor-E-Hafza Chairman Farnoor Garments Limited Mrs. Fauzia Qmrun Tania K. M. Farookh Mr. Sheikh Mohammed Danial Mrs. Shafia Sobhan Chowdhury Vice Chairman Nominee Of Rupali Insurance Company Limited Imperial Sweater Industries Ltd Dragon Sweater and Spning Limited, Bangladesh Rupali Insurance Company Liimited Farnoor Garments Ltd. Mirage Agro Complex. Mirage Group Fineness Aparal limited Perag Socks Industries Ltd Dragon Sweater and Spning Limited, Bangladesh Mrs. Kamrun Nahar K.S.Z Properties Limited Managing Managing Managing Mrs. Maya Rani Roy Uttara Finance & Investment Company Limited Alternate Mr. Sheikh Omar Faruque Mr.Omar Khayum Mr. Ahmed Rajeeb Samdani Hotel Eram Int` Ltd Hotel Peacock Ltd Olio Filling Station Golden Dragon Ltd Hotel Olio Int Araf Danial De Olio Center Hotel Eram Int` Ltd Hotel Peacock Ltd F. R Orbit International Limited. Golden Dragon Ltd Hotel Olio Int Golden Harvest Agro Industries Limited. Proprietor & CEO Proprietor Proprietor & CEO Managing Mrs. Hazera Hossain Manna Group Hannan Desh Wear Mrs. Hoda Ali Selim Honufa Akter Rikta Independent Intraco Refueling Station Ltd Intraco Renewable Energy Ltd Intraco Power Ltd Intraco Ready-mix Ltd Intraco Developers Ltd Intraco Water World Ltd. Not connect ed with any company Managing Managing Managing Managing Managing N/A 80

91 Quazi Moniruzzaman Independent Max sweater limited Rupali Insurance company Limited Managing Md. Nurun Nabi Independent Icon College, UK Principle (d) Statement of if any of the directors of the issuer are associated with the securities market in any manner. If any director of the Issuer Company is also a director of any issuer of other listed securities during last three years then dividend payment history and market performance of that issuer Neither any of the directors of SLICL is associated with the securities market in any manner nor is a director of any issuer of other listed securities except the followings: Name of the Listed Company Dragon Sweter spinning Limited Bangladesh Uttara Finance & Investment Company Limited Golden Harvest Agro Industries Limited Intraco Refueling Station Ltd Name of the s of the Issuer are Associated with Mrs. Fauzia Qumrun Tania Mrs. Shafia Sobhan Chowdhury Mrs. Maya Rani Roy Stock Dividend Dividend Payment History Cash Stock Cash Stock Dividend Dividend Dividend Dividend Cash Dividend 15% - 15% % - 30% 10% 20% Mr. Ahmed Rajeeb Samdani 10% - 10% - 10% - Mrs. Hoda Ali Selim Market Performance of the above listed securities based on last audited accounts of the Respective Companies are as follows Sl. Particulars Dragon Sweter spinning Limited Name of the Company Uttara Finance & Investment Company Limited 1 Listing Year Listing Category A A A 3 Authorized Capital BDT 1500 (mn) BDT 5000 (mn) BDT 2000 (mn) 4 Paid Up Capital BDT (mn) BDT (mn) BDT (mn) 5 Reserve & Surplus BDT (mn) BDT (mn) BDT (mn) 6 Net Profit After Tax BDT (mn) BDT (mn) BDT (mn) NAV per Share (Fy ) EPS (Fy 2017) Year High * BDT 50.3 (Fy 2018) BDT 76.3 (Fy 2018) BDT 38 (Fy 2018) Golden Harvest Agro Industries Limited 10 Year Low Price* BDT 16.8 (Fy 2018) BDT 62.3 (Fy 2018) BDT 31.6 (Fy 2018) 11 Closing Price as on BDT /11/2018 BDT 62.5 BDT Market Cap BDT (mn) BDT P/E on 08/11/ (Using basic EPS ) 10.03(Using basic EPS ) 24.37(Using basic EPS ) 14 Closing Price/NAV 1.07 ( Closing price as on 31 de,2017 is 17.1 and NAV on this date is 15.94) 1.46 (Closing price, as on 31 dec 2017 was Tk. And NAV was on that date 49.74) 1.9 ( Closing price as on 31 dec 2017 was 42.6 and NAV was on that date 22.10) 81

92 Source: DSE monthly review as on 09 November 2018 and DSE website * Price as per DSEmonthly review,november (e) Any family relationship (father, mother, spouse, brother, sister, son, daughter, spouse s father, spouse s mother, spouse s brother, spouse s sister) among the directors and top five officers; There are no family relationships among the top five Officers and directors except the followings. Sl. Name of Position Relationship No. 1. Mrs. Noor-E-Hafza Chairman Spouse Of K.M Farookh. 2. Mrs. Fauzia Qumrun Tania Vice-Chairman Spouse Of Mir Rashed Bin Aman 3. K.M. Farookh (Nominated director of Rupali Insurance Company Ltd.) Husband Of Mrs. Noor-E-Hafza 4. Mr. Sheikh Omar Faruque Brother Mr.Omar Khayum. 5. Mr.Omar Khayum Brother Mr.Sheikh Omar Faruque. 6. Mrs. Nargis Mahmuda Shareholder Sister Mr.Sheikh Omar Faruque and Mr.Omar Khayum. 7. Ajit Chandra Aich Managing No family relation with other s. 8. Mir Rashed Bin Aman 9. Md. Rafe-uz-zaman 10. Bikash Chandra Biswas Additional Managing & CFO Company Secretary and HR GM, Underwriting Department Husband of Mrs. Fauzia Qumrun Tania. No family relation with other s. No family relation with other s. (f) A very brief description of other businesses of the directors Brief descriptions of other business of the directors are given below: Name of the s Position in SLICL ship/sponsorship/ownership with other companies Brief Description Mrs. Noor-E-Hafza Chairman Farnoor Garments Limited RMG products and Knitting Mrs. Fauzia Qmrun Tania K. M. Farookh Mr. Sheikh Mohammed Danial Mrs. Shafia Sobhan Chowdhury Vice Chairman Nominee Of Rupali Life Insurance Company Limited Imperial Sweater Industries Ltd Dragon Sweater and Spning Limited, Bangladesh Rupali Life Insurance Company Liimited Farnoor Garments Ltd. Mirage Agro Complex. Fineness Aparal limited Perag Socks Industries Ltd Dragon Sweater and Spning Limited, Bangladesh Textile and RMG Textile and RMG Life Insurance Company RMG products and Knitting Agro Based Business Denim clothing business Socks Business RMG and Textile 82

93 Mrs. Kamrun Nahar K.S.Z Properties Limited Real state Business Mrs. Maya Rani Roy Uttara Finance & Investment Company Limited Financial Institution Mr. Sheikh Omar Faruque Mr.Omar Khayum Mr. Ahmed Rajeeb Samdani Hotel Eram Int` Ltd Hotel Peacock Ltd Olio Filling Station Golden Dragon Ltd Hotel Olio Int Araf Danial De Olio Center Hotel Eram Int` Ltd Hotel Peacock Ltd F. R Orbit International Limited. Golden Dragon Ltd Hotel Olio Int Golden Harvest Agro Industries Limited. Mrs. Hazera Hossain Manna Group Textile Mrs. Hoda Ali Selim Honufa Akter Rikta Quazi Moniruzzaman Independent Independent Intraco Refueling Station Ltd Intraco Renewable Energy Ltd Intraco Power Ltd Intraco Ready-mix Ltd Intraco Developers Ltd Intraco Water World Ltd. Not connect ed with any company Max sweater limited Rupali Insurance company Limited Hotel Business Hotel Business Oil And CNG filling station Restaurent Hotel Business Hotel and restaurent Hotel Business Hotel Business IT company Restaurent Hotel Business Agro Based Business CNG and Refuiling station Oil energy Oil and energy RMG Developing business Water business N/A Managing Md. Nurun Nabi Independent Icon College, UK Principal (g) Short Bio Data of the s Noor-E-Hafza, Chairperson Noor-E-Hafza is the Chairman of the company. She holds post graduate degree from Rajshahi University. She completed diploma in Food & Nutrition from the University of Dhaka. She obtained diploma degree from the University Of London School Of Arts. She served as personnel officer in Bangladesh Chemical Industries Corporation (BCIC). She was involved in private practice with Dr. M.Q.K Talukder as a junior consultant for 4 years. She worked as chief nutritionist in National nutrition council for 3 years. She is a of Farnoor Garments Limited over 30 years. Fauzia Quamrun Tania, Vice Chairperson Fauzia Quamrun Tania is the Vice Chairman of the Company. She holds BSc Hons. as well as post graduate degree in Business Management and Mathematics from Glasgow University UK, with excellent academic track recor d. She is the Managing of Imperial Sweater Industries Ltd. and She is also a of Dragon Sweater Bangladesh Limited. K.M. Farookh, Rupali Insurance Company Ltd is one of the top General Insurance Company of the country. Rupali Insurance Company Limited is a of Sonali Life Insurance Company Limited which is represented by Mr. K.M Farookh who is a of Rupali Insurance Company Ltd. He is the founder and Chairman of Farnoor Garments Ltd. S Mohammad Danial, Sheikh Mohammad Danial is a of the Company. After Graduation from the University of Canberra, as a young entrepreneur he has founded Mirage Agro Complex, which has expanded its operations from fresh produce exports to food 83

94 grain and commodity trading. He is also a of Mirage Group, which has interest in Ready-Made-Garments, trading, and real estate. S Sobhan Chowdhury, Shafia Sobhan Chowdhury is a of the Company. After Graduating from University of Florida with top hon our she has been successfully contributing towards various businesses that she is involved in. She is the of Perag Socks Industr ies Ltd., Dragon Sweater Bangladesh Ltd. and Dragon Sweater and Spinning Ltd. A Rajeeb Samdani, Ahmed Rajeeb Samdani is a of the Company. He is a Managing of Golden Harvest Group and the founder and trustee of Samdani Art Foundation. He is also the founding committee member of Tate Museum, United Kingdom, South Asia Acquisition Committee. He is the Secretary General of the Bangladesh Human Rights Foundation. He has started his career as a commodity broker with Stemcor. Over the years, his company, Golden Harvest has expanded its businesses into Information Technology, Commodities, Logistics, Food processing, Agriculture, Aviation business, Real Estate and Insurance business. Hazera Hossain, Mrs. Hazera Hossain is a of the Company. After graduating from AIUB, she has served in different corporate houses in Bangladesh. She was a of Famous spinning mills. She is also a of Hannan Desh Wear. Sheikh Omar Faruque, Sheikh Omar Faruque is a of the company. He is involved in different types of Businesses. He is a of Hotel Eram Int` Ltd and Hotel Peacock Ltd. He is a proprietor of Olio International. Omar Khayum, Omar Khayum is a of the company. After graduating from Westminister Business School, he is involved in different businesses. He is a of Hotel Eram Int` Ltd and Hotel Peacock Ltd. He is also a proprietor & CEO of F. R Orbit International Limited. Kamrun Nahar, Mrs. Kamrun Nahar is a of the company. She is involved in Real Estate business. She is a of K.S.Z Propertie s Limited. Maya Rani Roy, Maya Rani Roy is a of the Company. She holds a Master of Arts Degree from Jagannath University. She served in different corporate houses. She was an Alternate of Uttara Finance & Investment Company Limited. She was a member of different voluntary welfare organizations in the country. Hoda Ali Selim, Mrs. Hoda Ali Selim is a of the Company. She holds post graduation degree from National University. She is involved in different types of business. She is a of Hotel Agrabad Limited. She is also a Managing of Intraco Ready Mix Limited Honufa Akter Rikta Honufa Akter Rikta is an Independent of the Company. She holds a L.L.B Degree from Bangladesh bar accusation. She was a member of different voluntary welfare organizations in the country. Quazi Moniruzzaman Mr. Quazi Moniruzzaman, one of the Independent s of the Company, he is the director of different type of business organization in this country. He is the managing director of Max Sweaters and Rupali Insurance Company ltd. Professor Nurun Nabi Professor Nurun Nabi one of the Independent s of the Company, He holds MBA (Henley at Oxon), PhD (London), Certificate in SBM (Harvard), FInstLM, MPDSE,he was a member of different voluntary welfare organizations and educational organization in the country.. 84

95 (h) Loan status of the issuer, its directors and shareholders who hold 10% or more shares in the paid-up capital of the issuer in terms of the CIB Report of Bangladesh Bank Neither SLICL nor any of its Sponsors or s or shareholders who hold 10% or more shares in paid -up capital of the SLICL is a loan defaulter in terms of the CIB Report of the Bangladesh Bank. (i) Name with position, educational qualification, age, date of joining in the company, overall experience (in year), previous employment, salary paid for the financial year of the Chief Executive Officer, Managing, Chief Financial Officer, Company Secretary, Advisers, Consultants and all Departmental Heads. If the Chairman, any director or any shareholder received any monthly salary than this information should also be included; Particulars of Top Executives & Departmental heads of the Company including Consultants & Advisers Name Ajit Chandra Aich Mir Rashed Bin Aman Md. Rafeuz-zaman Bikash Chandra Biswas Shah Abu Khair Md. Golam Mostofa Rajesh Aich Polly Rani Sarker Sanjoy Chakraborty Muttakin Islam Mukta Position Managing Additional Managing & CFO Company Secretary and HR GM, Underwriting Department Date of Joining in the company Age Educational Qualification Overall Experience (in year) 01 Jan- 30 Jun, 2018 (06 month) Salary paid 01 Jan- 31 Dec, Masters 33 2,010, ,020, Masters 17 1,980, ,600, MBA (HRM & Marketing) and Chartered Secretaries (Level-2) 8 222, , Masters , , Previous employment Shandhani Life insurance co.ltd Rupali Insurance Co.Ltd Robi Axiata (Sales team) Delta Life insurance co. ltd AGM, Rupali Finance & Masters , , Insurance Accounts Co.Ltd Division Head of IT & AGM Masters , , Forest green Senior Shandhani Manager, Life Development Bachelor , , insurance Admin co.ltd Division Manager, Policy Services Masters 6 148, , Division Manager, Claim And Group Masters 6 187, , Insurance Head of CharteredLife Training Masters , , Insurance Co. Ltd Adviser Consultant SLICL has no adviser SLICL has no consultant Apart from this, no other director including Chairman, or any shareholder of the Company do not receive any monthly Salary from the Company. 85

96 (j) Changes in the key management persons during the last three years. Any change otherwise than by way of retirement in the normal course in the senior key management personnel particularly in charge of production, planning, finance and marketing during the last three years prior to the date of filing the information memorandum. If the turnover of key management personnel is high compared to the industry, reasons should be discussed; During the last three years, in the management of SLICL no any major change has happend. 86

97 (k) A profile of the sponsors including their names, father s names, age, personal addresses, educational qualifications, and exp eriences in the business, positions or posts held in the past, directorship held, other ventures of each sponsor and present position; SL # Name of the Sponsor's 01 Mrs. Noor-E-Hafza Father's name Md. Asaduzzaman 64 Age Personal address Educational qualification Dream Castle, House # 7, Road# 4Gulshan- 1,Dhaka-1212 Exp. in the business Position /Posts held in the past M.Sc 36 Chairman ship held Since inception Status of the Sponsor in other ventures and position Name of the Company Farnoor Garments Limited Position Mrs. Fauzia Qumrun Tania K. M. Farookh (Nominee of Rupali Insurance Company Ltd) Mr. Sheikh Mohammed Danial Mostofa Golam Quddus Abdul Hamid mozumder Sheikh Abdul Matin 33 House #2/3, Road#03,Banani,Dhaka Dream Castle, House # 7, Road# 4Gulshan- 1,Dhaka-1212 House 4, Road-06, Khulshi, Chittagong. B.Sc (Hons), M.Sc 11 B.A 37 BBA, Graduation Vice- Chairman 10 Since inception Since inception Since inception Imperial Sweater Industries Ltd Dragon Sweater and Spning Limited, Bangladesh Farnoor Garments Limited Rupali Insurance Company Ltd Mirage Agro Complex. Mirage Group Fineness Aparal limited Managing Managing. Managing 05 Mrs. Shafia Sobhan Chowdhury Zafar Ullah Chowdhury 36 House-69, Road-07, Block-F, Banani, Dhaka-1213 BBA, Graduation 10 Since inception Perag Socks Industries Ltd Dragon Sweater and Spning Limited, Bangladesh Mrs. Kamrun Nahar Mrs. Maya Rani Roy Late Sheikh Abdul Khaleque Late Bidhu Bhushan Saha House#808, Road#24,Block #F,Bashundhara, Dhaka House- 67, Road-07, Block-F, Banani, Dhaka BSc hons 30 Masters in Arts 18 Since inception Since inception K.S.Z Properties Limited Uttara Finance & Investment Company Limited Alternate 87

98 08 Mr. Sheikh Omar Faruque Ferozur Rahman 46 Yakub nagar, (South jangal) Sultanpur, B- Baria sadar, B-Baria BBA 25 Since inception Hotel Eram Int` Ltd Hotel Peacock Ltd Olio Filling Station Golden Dragon Ltd Hotel Olio Int Araf Danial De Olio Center Proprietor & CEO Proprietor 09 Mr.Omar Khayum Ferozur Rahman 40 My heart Sukrabad, House-8/1, Sukrabad, Dhaka B.A Hons 18 Since inception Hotel Eram Int` Ltd Hotel Peacock Ltd F. R Orbit International Limited. Golden Dragon Ltd Hotel Olio Int Proprietor & CEO Mr. Ahmed Rajeeb Samdani Mrs. Hazera Hossain Enamuzzam Chowdhury 45 Late Rabi Ullan 39 House-9, Road-12, Block-SW (B) Gulshan- 1, Dhaka / B, East Raza Bazar, Tejgaon, Dhaka MBA 22 BBA 10 Since inception Since inception Golden Harvest Agro Industries Limited. Samdani Art Foundaon Alvina Samdani Trust Manna Group Hannan Desh Wear Chief Executive Officer and Managing Founder Founder 12 Mrs. Hoda Ali Selim Ali Selim Ahmed , Sarder Ali Lane, Mohammed zaman Road, Mosque Goli, Pachlaish, Chittagong. MSC in Computer science 15 Since inception Intraco Group Intraco Renewable Energy Ltd Intraco Power Ltd Intraco Ready-mix Ltd Intraco Developers Ltd Intraco Water World Ltd. Managing Managing Managing Managing Managing Honufa Akter Rikta Quazi Moniruzzaman Md. Nurun Nabi Md. Habibullah Ansari Late, Quazi Mohiuddin Sultan Ahmmed Bashura, Uttar Padua, Choddogram, Comilla South Rupsi,Rupsi, Rupgonj, Narayangonj H-18. R-3, p- Chakbazar,PS- Panchlash, Chittagong LLB Hons 10 B.com 40 Phd 50 Independent Independent Independent AGM 2018 AGM 2018 AGM 2018 Not connected with any company Max Sweaters Limited Rupali Insurance Company Limited Icon College N/A Managing Principle 88

99 (l) If the present directors are not the sponsors and control of the issuer was acquired within five years immediately preceding the date of filing Prospectus details regarding the acquisition of control, date of acquisition, terms of acquisition, consideration paid for such acquisition etc.; None of the s of the Company acquired controlling shares within five years immediately preceding the date of filing Prospectus. (m) If the sponsors or directors do not have experience in the proposed line of business, the fact explaining how the proposed activities would be carried out or managed; All the sponsors/directors have experience in the proposed line of business. (n) Interest of the Key management persons; Name Salary paid Designation 01 Jan- 30 Jun, Jan 31 Dec,2017 Ajit Chandra Aich Managing 2,010, ,020, Mir Rashed Bin Aman Additional Managing & CFO 1,980, ,600, Md. Rafe-uz-zaman Company Secretary and HR 222, , Bikash Chandra Biswas GM, Underwriting Department 302, , Shah Abu Khair AGM, Finance & Accounts Division 252, , Md. Golam Mostofa Head of IT & AGM 282, , Rajesh Aich Senior Manager, Development Admin Division 205, , Polly Rani Sarker Manager, Policy Services Division 148, , Sanjoy Chakraborty Manager, Claim And Group Insurance 187, , Muttakin Islam Mukta Head of Training 514, , }}}* Salary is paid by SLICL. (o) All Interest and facilities enjoyed by the directors, whether pecuniary or non-pecuniary; All Interest and facilities enjoyed by the directors, whether pecuniary or non-pecuniary as on 30 June 2018 are as follows: Name of s Relationship Nature of facilities Amount in Taka Mrs. Noor-E-Hafza Chairman Board Attendance Fee 13, Mrs. Fauzia Qumrun Tania Vice-Chairman Board Attendance Fee 13, K. M. Farookh (Nominee director of Rupali Insurance Company Ltd.) Board Attendance Fee 13, Mr. Sheikh Mohammed Danial Board Attendance Fee 13, Mrs. Shafia Sobhan Chowdhury Board Attendance Fee 13, Mrs. Kamrun Nahar Board Attendance Fee 13, Mrs. Maya Rani Roy Board Attendance Fee 13, Mr. Sheikh Omar Faruque Board Attendance Fee 13, Mr.Omar Khayum Board Attendance Fee 13, Mr. Ahmed Rajeeb Samdani Board Attendance Fee 13, Mrs. Hazera Hossain Board Attendance Fee 13, Mrs. Hoda Ali Selim Board Attendance Fee 13, Honufa Akter Rikta Independent Board Attendance Fee N/A Quazi Moniruzzaman Md. Nurun Nabi Independent Board Attendance Fee N/A Independent Board Attendance Fee N/A 89

100 (p) Number of Shares held and percentage of Shareholding (Pre-Issue) Sl. No. Name of the Shareholders BO ID Address No. of Shares 01 Mrs. Noor-E-Hafza Mrs. Fauzia Qumrun Tania K. M. Farookh (Nominee director of Rupali Insurance Company Ltd.) Mr. Sheikh Mohammed Danial Mrs. Shafia Sobhan Chowdhury Mrs. Kamrun Nahar Mrs. Maya Rani Roy Mr. Sheikh Omar Faruque Mr.Omar Khayum Mr. Ahmed Rajeeb Samdani Mrs. Hazera Hossain Mrs. Hoda Ali Selim Honufa Akter Rikta Quazi Moniruzzaman Md. Nurun Nabi N/A N/A N/A Dream Castle, House # 7, Road# 4Gulshan-1,Dhaka-1212 House #2/3, Road#03,Banani,Dhaka-1213 Rupali Bima Bhaban, 7, Rajuk Avenue, Dhaka-1000 House 4, Road-06, Khulshi, Chittagong. House-69, Road-07, Block-F, Banani, Dhaka-1213 House#808, Road#24, Block #F, Bashundhara, Dhaka House- 67, Road-07, Block-F, Banani, Dhaka Yakub nagar, (South jangal) Sultanpur, B-Baria Sadar, B- Baria My heart Sukrabad, House-8/1, Sukrabad, Dhaka House-9, Road-12, Block-SW(B) Gulshan-1, Dhaka / B, East Raza Bazar, Tejgaon, Dhaka 1858, Sarder Ali Lane, Mohammed zaman Road, Mosque Goli, Pachlaish, Chittagong. Bashura, Uttar Padua, Choddogram, Comilla South Rupsi,Rupsi, Rupgonj, Narayangonj H-18. R-3, p-chakbazar,ps- Panchlash, Chittagong Shareholding ( %) 2,927, ,386, ,566, ,695, ,630, ,150, ,000, ,000, ,000, ,530, ,285, ,000, N/A N/A N/A N/A N/A N/A (q) Changes in the Board of s in last three years; There are no changes in the Board of s in last three Years: Sl. No. Name of the s Date of Joining Date of retirement Present Status 1 Honufa Akter Rikta AGM 2018 Nill Independent 2 Quazi Moniruzzaman AGM 2018 Nill Independent 3 Md. Nurun Nabi AGM 2018 Nill Independent 90

101 (r) 's engaged with similar business Following s are engaged in similar business: Sl No. Name of the s Position in Similar Business Nature of Business 01 K.M Farookh Insurance 02 Quazi Moniruzzaman Insurance 91

102 CHAPTER IX: CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS: Prospectus ofslicl (a)the prospectus shall contain a description of any transaction during the last five years, or any proposed transactions certified by the auditors, between the issuer and any of the following persons, giving the name of the persons involved in the transaction, their relationship with the issuer, the nature of their interest in thetransaction and the amount of such interest, namely:- (i)any director or sponsor or executive officer of the issuer; (ii)any person holding 5% or more of the outstanding shares of the issuer; (iii)any related party or connected person of any of the above persons; Certification of Statement of Related Party Transaction of Sonali Life Insurance Company Limited This is to certify that thefinancial statements fo the Sonali Life Insurance Company Limited furnished for our audit does not have any transaction during the last five years, or any proposed transaction between the issuer and any of the following persons: i. Any director or sponsor or executive officer to the issuer; ii. Any person holding 5% or more of the outstanding shares of the issuer; iii. Any relaed party or connected person of any of the above person; Except the transactions for the last five years described in the following table: Name of the Party Mrs. Noor-E-Hafza Mrs. Fauzia Quamrun Tania K.M Farookh (Nominee Of Rupali Insurance Company Limited) Mrs. Shafia Sobhan Chowdhury Mr. Sheikh Mohammed Danial Mrs. Kamrun Nahar Mrs. Maya Rani Roy Mr. Sheikh Omar Faruque Mr. Omar Khayam Particulars Relations hip with the Company Chairman & Shareholde r Vice Chairman & Shareholde r e & Shareholde r e & Shareholde r e & Shareholde r e & Shareholde r e & Shareholde r e & Shareholde r e & Nature of transaction Amoun t in Taka 30 June 2018 Board Meeting Fee 13,000 Board Meeting Fee 13,000 Board Meeting Fee 13,000 Board Meeting Fee 13,000 Board Meeting Fee 13,000 Board Meeting Fee 13,000 Board Meeting Fee 13,000 Board Meeting Fee 13,000 Board Meeting Fee 13,000 Amount in Taka 31 Dec Amount in Taka 31 Dec Amount in Taka 31 Dec ,000 20,000 20,000 20,000 20,000 20,000 20,000 20,000 20,000 20,000 20,000 20,000 20,000 20,000 20,000 20,000 20,000 20,000 20,000 20,000 20,000 20,000 20,000 20,000 20,000 20,000 20,000 Amount in Taka 31 Dec Amount in Taka 20,000-20,000-20,000-20,000-20,000-20,000-20,000-20, Dec ,000-92

103 Mr. Ahmed Rajeeb Samdani Mrs. Hazera Hossain Mrs. Hoda Ali Selim Imperial Sweater Industries Ltd. Perag Socks Industries Ltd. Dragon Sweater Bangladesh Ltd. Rupali Insurance Company Limited Golden Harvest Agro Industries Ltd. Golden Harvest Icecreame Ltd. Golden Harvest Foods Ltd Shareholde r e & Shareholde r e & Shareholde r e & Shareholde r Common Common Common Common Common Common Common Board Meeting Fee 13,000 Board Meeting Fee 13,000 Board Meeting Fee 13,000 20,000 20,000 20,000 20,000 20,000 20,000 20,000 20,000 20,000 20,000-20,000-20,000 - Group Insurance - 5,000,000 5,000,000 5,000, Group Insurance - 5,000,000 5,000,000 5,000, Group Insurance - 10,000,000 10,000,000 10,000,000 - Group Insurance ,157 Group Insurance - 95,175 95, Group Insurance - 124, , Group Insurance - 17,550 17, Dragon IT & Communication Ltd. Common Payable ,169,31 7 Intraco Refueling Stations Limited Intraco CNG Ltd. Rulali Insurance Company Limited Common Receivable Common Common Receivable 2,500, ,000 Office rent 240, , , , Date : 6 August 2018 Place : Dhaka AHMAD & AKHTAR Chartered Accountants 93

104 (b) Any transaction or arrangement entered into by the issuer or its subsidiary or associate or entity owned or significantly influenced by a person who is currently a director or in any way connected with a director of either the issuer company or any of its subsidiaries or holding company or associate concerns, or who was a director or connected in any way with a director at any time during the last three years prior to the issuance of the Prospectus There is no transaction or arrangement entered into by the issuer or its subsidiary or associate or entity owned or significantly influenced by a person who is currently a director or in any way connected with a director of either the issuer company or any of its subsidiaries/holding company or associate concerns, or who was a director or connected in any way with a director at any time during the last three years prior to the issuance of the prospectus except the transaction mentioned under clause(a) of CHAPTER (IX). (c) Any loans either taken or given from or to any director or any person connected with the director, clearly specifying details of such loan in the Prospectus, and if any loan has been taken from any such person who did not have any stake in the issuer, its holding company or its associate concerns prior to such loan, rate of interest applicable, date of loan taken, date of maturity of loan, and present outstanding of such loan. The company has not taken or given any loan from/to any director or any person connected with the directorwithin last five years. 94

105 CHAPTER X: EXECUTIVE COMPENSATION: (a) The total amount of remuneration or salaryor perquisites paid to the top five salaried officers of the issuer in the last accounting year and the name and designation of each such officer; The total amount of remuneration/salary/perquisites paid to the top five salaried officers of the issuer in the last accounting year and the name and designation of each such officer: (Amount in BDT) SL Name Designation Remuneration/salaries (Tk.) for the period from 01 January to 30 June, 2018 (06 months) Remuneration/salaries (Tk.) for the year ended 31 Dec, Ajit Chandra Aich Managing 2,010, ,020, Mir Rashed Bin Aman Chief Financial Officer 1,980, ,600, Md. Rafe-uzzaman Company Secretary 222, , Bikash Chandra Biswas General Manager 302, , Shah Abu Khair Assistant General Manager 252, , Total 4,766, ,966, (b) Aggregate Amount of Remuneration paid to all directors and officers as a group during last accounting year ( ). (Amount in BDT) Particular Nature of Payments Amount Paid For the period ended 30 June, 2018 Amount Paid For the year ended 31 dec, 2017 s Board Meeting Fees 156, ,000 s Remuneration Nill Nill Executives & 51,419, Salary and Allowance 25,397, Employees Total 25,553, ,659, (c) If any shareholder director received any Monthly salaryor perquisiteor benefit of shareholder director and approval date of AGMor EGM including terms thereof and payments made last year; There is no any shareholder director who received any monthly salary or prerequisitory benefit during the period or last year. (d)the Board Meeting attendance fee of s including managing director along with date of approval in AGM or EGM; The Board meeting attendance fees received by all the s including the Managing, for the year ended June 30, 2018 are as follows: Name & Designation Attendance Board Meeting Fee Date of Approval in (Amount in Tk.) AGM Mrs. Noor-E-Hafza 02 13, AGM of 2017 Mrs. Fauzia Qumrun Tania 02 13, AGM of 2017 K. M. Farookh (Nominee director of Rupali Insurance Company Ltd.) 02 13, AGM of 2017 Mr. Sheikh Mohammed Danial 02 13, AGM of 2017 Mrs. Shafia Sobhan Chowdhury 02 13, AGM of 2017 Mrs. Kamrun Nahar 02 13, AGM of 2017 Mrs. Maya Rani Roy 02 13, AGM of 2017 Mr. Sheikh Omar Faruque 02 13, AGM of

106 Mr.Omar Khayum 02 13, AGM of 2017 Mr. Ahmed Rajeeb Samdani 02 13, AGM of 2017 Mrs. Hazera Hossain 02 13, AGM of 2017 Mrs. Hoda Ali Selim 02 13, AGM of 2017 (e)any contract with any director or officer providing for the payment of future compensation; There is no such contract between the Company and any of its directors or officers regarding any future compensation to be made to them. (f) If the issuer intends to substantially increase the remuneration paid to its directors and officers in the current year, appropriate information regarding thereto; There is no intention to increase remuneration substantially of the s and officers in the current year. However, the remuneration of the officers is increased based on annual appraisal of their performance which is made as per company s policies. (g) Any other benefitor facility provided to the above persons during the last accounting year. DGM & GM are provided full time car facilities with maintenance from the Company during last accounting year, othethan the remuneration/salary/perquisite mentioned in clause (a) (b) (c) & (d) 9(a)(b)(c)(d) of chapter X. 96

107 CHAPTER XI: OPTIONS GRANTED TO DIRECTORS, OFFICERS AND EMPLOYEES: (1) The following information in respect of any option held by each director, the salaried officers, and all other officers as a group, namely: - (i) The date on which the option was granted; (ii) The exercise price of the option; (iii) The number of shares or stock covered by the option; (iv) The market price of the shares or stock on the date the option was granted; (v) The expiration date of the option; (vi) Consideration against the option. The Company did not grant any options to its directors, officers and other employees. (2) If such options are held by any person other than the directors, and the officers of the issuer company, the following information shall be given in the prospectus, namely:- (i) The total number of shares or stock covered by all such outstanding options; (ii) The range of exercise prices; (iii) The range of expiration dates; (iv) Justification and consideration of granting such option. Not applicable 97

108 CHAPTER XII: TRANSACTION WITH THE DIRECTORS AND SUBSCRIBERS TO THE MEMORANDUM: (a) The names of the directors and subscribers to the memorandum, the nature and amount of anything of value received or to be received by the issuer from the above persons, or by the said persons, directly or indirectly, from the issuer during the last five years along with the description of assets, services or other consideration received or to be received; The s and Subscribers to the Memorandum have not received any benefit directly or indirectly except remuneration of Managing and board attendance fee and dividend received by the directors during the last five years, details of which are given below. The issuer has not received or to be received any assets, services or other consideration from its s and Subscribers to the Memorandum except fund against allotment of shares and purchase of land. Amount received by the directors and subscriber to the memorandum from the company: (Amount in BDT) Name of the directors and subscribers Nature of Relationship Nature of transaction Noor-E-Hafza. Fauzia Quamrun Tania K.M Farookh(Nominee director of Rupali Insurance Co. Ltd.) Shafia Sobhan Chowdhury Sheikh Mohammad Danial Ahmed Rajeeb Samdani Chairman Vice-Chairman Remuneration Dividend (Cash) Dividend (Bonus) Board Atten. Fee 10,000 20,000 20,000 20,000 13,000 Loan refund Remuneration Dividend (Cash) Dividend (Bonus) Board Atten. Fee 10,000 20,000 20,000 20,000 13,000 Remuneration Dividend (Cash) Dividend (Bonus) Board Atten. Fee 10,000 20,000 15,000 20,000 13,000 Remuneration Dividend (Cash) Dividend (Bonus) Board Atten. Fee 10,000 20,000 20,000 20,000 13,000 Remuneration Dividend (Cash) - Dividend (Bonus) Board Atten. Fee 10,000 20,000 20,000 20,000 13,000 Board Atten. Fee ,000 Hazera Hossain Board Atten. Fee 10,000 20,000 20,000 20,000 13,000 Omar Khayam Board Atten. Fee 10,000 20,000-20,000 20,000 13,000 Sheikh Faruque Omar Board Atten. Fee 10,000 20,000 15,000 20,000 13,000 Kamrun Nahar Board Atten. Fee - 20,000 20,000 20,000 13,000 Maya Rani Roy Board Atten. Fee 10,000 20,000 20,000 20,000 13,000 Hoda Ali Selim Board Atten. Fee 10,000 20,000 20,000 20,000 13,000 98

109 Asset to be transferred to the company by its directors and their connected persons: None of the directors and their connected persons has transferred any asset to SLICL for the last five years of its opereation. [ (b) If any assets were acquired or to be acquired within next two financial years from the aforesaid persons, the amount paid for such assets and the method used to determine the price shall be mentioned in the prospectus, and if the assets were acquired by the said persons within five years prior to transfer those to the issuer, the acquisition cost thereof paid by them. SLICL does not have any plan to acquire any asset from the aforesaid persons within next two financial years. 99

110 CHAPTER XIII: OWNERSHIP OF THE COMPANY'S SECURITIES: (a) The names, addresses, BO ID Number of all shareholders of the company before IPO, indicating the amount of securities owned and the percentage of the securities represented by such ownership, in tabular form Name of the Shareholders Mrs. Noor-E-Hafza Mrs. Fauzia Qumrun Tania K. M. Farookh (Nominee director of Rupali Insurance Company Ltd.) Mr. Sheikh Mohammed Danial Mrs. Shafia Sobhan Chowdhury Mrs. Kamrun Nahar Address Dream Castle, House # 7, Road# 4Gulshan-1,Dhaka-1212 House #2/3, Road#03,Banani,Dhaka Dream Castle, House # 7, Road# 4Gulshan-1,Dhaka-1212 BO ID No. of Securities Pre-IPO (%) Post- IPO (%) ,927, ,386, ,566, House 4, Road-06, Khulshi, Chittagong ,695, House-69, Road-07, Block-F, Banani, Dhaka-1213 House#808, Road#24,Block #F,Bashundhara, Dhaka ,630, ,150, Mrs. Maya Rani Roy Mr. Sheikh Omar Faruque Mr.Omar Khayum Mr. Ahmed Rajeeb Samdani Mrs. Hazera Hossain Mrs. Hoda Ali Selim House- 67, Road-07, Block-F, Banani, Dhaka Yakub nagar, (South jangal) Sultanpur, B- Baria sadar, B-Baria My heart Sukrabad, House-8/1, Sukrabad, Dhaka House-9, Road-12, Block-SW(B) Gulshan-1, Dhaka / B, East Raza Bazar, Tejgaon, Dhaka 1858, Sarder Ali Lane, Mohammed zaman Road, Mosque Goli, Pachlaish, Chittagong ,000, ,000, ,000, ,530, ,285, ,000,

111 (b) There shall also be a table showing the name and address, age, experience, BO ID Number, TIN number, numbers of shares he ld including percentage, position held in other companies of all the directors before the public issue; No. of Pre- Name of the Age Experience E- TIN Position Address BO ID shares IPO Name of other Company s' (years) (years) number held held % Dream Castle, House # 7, Road# 4Gulshan-1,Dhaka Mrs. Noor-E-Hafza ,927, Chairman Farnoor Garments Limited Mrs. Fauzia Qumrun Tania House #2/3, Road#03,Banani,Dhaka ,386, Imperial Sweater Industries Ltd Dragon Sweater and Spinning Limited, Bangladesh Vice chairman K.M Farookh (Nominee director of Rupali Insurance Company Ltd.) Dream Castle, House # 7, Road# 4Gulshan-1,Dhaka ,566, Farmoor Garments Limtied Rupali Insurance Company Ltd. Mr. Sheikh Mohammed Danial House 4, Road-06, Khulshi, Chittagong ,695, Mirage Agro Complex. Mirage Group Fineness Aparal limited Mrs. Shafia Sobhan Chowdhury House-69, Road-07, Block-F, Banani, Dhaka ,630, Perag Socks Industries Ltd Dragon Sweater and Spning Limited, Bangladesh 101

112 Name of the s' Mrs. Kamrun Nahar Address House#808, Road#24,Block #F,Bashundhara, Dhaka Age (years) Experience (years) BO ID E- TIN number No. of shares held Pre- IPO % Name of other Company 1,150, K.S.Z Properties Limited Position held Mrs. Maya Rani Roy House- 67, Road-07, Block-F, Banani, Dhaka ,000, Uttara Finance & Investment Company Limited Mr. Sheikh Omar Faruque Yakub nagar, (South jangal) Sultanpur, B-Baria sadar, B- Baria ,000, F.R Group Hotel Eram Int` Ltd Hotel Peacock Ltd Olio Filling Station Golden Dragon Ltd Hotel Olio Int Araf Danial De Olio Center Mr.Omar Khayum My heart Sukrabad, House- 8/1, Sukrabad, Dhaka ,000, F.R Group Hotel Eram Int` Ltd Hotel Peacock Ltd F. R Orbit International Limited. Golden Dragon Ltd Hotel Olio Int Mr. Ahmed Rajeeb Samdani House-9, Road-12, Block- SW(B) Gulshan-1, Dhaka ,530, Golden Harvest Agro Industries Limited. Samdani Art Foundaon Alvina Samdani Trust 102

113 Name of the s' Mrs. Hazera Hossain Address 18/ B, East Raza Bazar, Tejgaon, Dhaka Age (years) Experience (years) BO ID E- TIN number No. of shares held Pre- IPO % 1,285, Name of other Company Manna Group Hannan Desh Wear Position held Mrs. Hoda Ali Selim 1858, Sarder Ali Lane, Mohammed zaman Road, Mosque Goli, Pachlaish, Chittagong ,000, Intraco Group Intraco Renewable Energy Ltd Intraco Power Ltd Intraco Ready-mix Ltd Intraco Developers Ltd Intraco Water World Ltd. Honufa Akter Rikta Bashura, Uttar Padua, Choddogram, Comilla N/A N/A N/A Not connected with any company N/A Quazi Moniruzzaman South Rupsi,Rupsi, Rupgonj, Narayangonj N/A N/A N/A Max Sweaters Limited Rupali Insurance Company Limited Managing Md. Nurun Nabi H-18. R-3, p-chakbazar,ps- Panchlash, Chittagong N/A N/A N/A Icon College Principle 103

114 (c) The average cost of acquisition of equity shares by the directors certified by the auditors ; The Average Cost of Acquisition of Equity Shares by the s certified This is to certify that all the shares of the Sonali Life Insurance Company Limited have been allocated to its s in Cash or Bonus and the average cost of acquisition of equity by the directors and necessary particulars of shareholdings, allotments dates and consideration are given below: No. of Shares Held Date Nature of Transaction By Subscription MOA Rupali Insurance Co. Ltd. Fauzia Quamrun Tania Shafia Sobhan Chowdhury Sheikh Mohammad Danial Noor-E- Hafza Ahmed Rajeeb Samdani Hazera Hossain Omar Khayam Sheikh Omar Faruque Kamrun Nahar Maya Rani Roy Hoda Ali Selim 3,000,000 2,450,000 1,930,000 1,500,000 1,160,000 1,030,000 1,030,000 1,000,000 1,000,000 1,000, , ,000 Consideration Average Acquisition cost of shares Tk. Cash By Allotment 1,566,000 1,936,500 1,700,000 2,195,000 1,767, , , , , ,000 Cash Total 4,566,000 4,386,500 3,630,000 3,695,000 2,927,500 1,530,000 1,285,000 1,000,000 1,000,000 1,150,000 1,000,000 1,000,000 Sd/ Ahmad & Akhtar 104

115 (d) A detail description of capital built up in respect of shareholding (name-wise) of the issuer s sponsors/ directors. In this connection, a statement to be included:- A detail description of capital built up in respect of shareholding (name-wise) of the issuer s sponsors/ directors: Mrs. Noor-E-Hafza Date of Allotment/ Transfer of fully paid- up shares Considerat ion Nature of issue No. of Equity shares Face value Issue Price/Acq uisition Price/Tran sfer Prices Cumulative no. of Equity shares % Preissue paid up capital On MA/AA Cash Ordinary 1,160, ,160, Cash Share 1,767, ,927,500 % K.M Farookh (Nominee of Rupali Insurance Company Limited) % Post issue paid up capital 6.16% Sourc es of fund Own Source Date of Allotment/ Transfer of fully paid- up shares Considerat ion Nature of issue No. of Equity shares Face value Issue Price/Acq uisition Price/Tran sfer Prices Cumulative no. of Equity shares % Preissue paid up capita l On MA/AA Cash Ordinary 3,000, ,000, Cash Share 1,566, ,566,000 % % Post issue paid up capita l 9.61% Source s of fund Own Source Fauzia Quamran Tania Date of Allotment/ Transfer of fully paid- up shares Considerat ion Nature of issue No. of Equity shares Face value Issue Price/Acq uisition Price/Tran sfer Prices Cumulative no. of Equity shares % Preissue paid up capital On MA/AA Cash Ordinary 2,450, ,450, Cash Share 1,936, ,386,500 % % Post issue paid up capital 9.23% Source s of fund Own Source Shafia Sobhan Chowdhury Date of Allotment/ Transfer of fully paid- up shares Considerat ion Nature of issue No. of Equity shares Face value Issue Price/Acq uisition Price/Tran sfer Prices Cumulative no. of Equity shares % Preissue paid up capital On MA/AA Cash Ordinary 1,930, ,930, Cash Share 1,700, ,630,000 % Sheikh Mohammad Danial % Post issue paid up capital 7.64% Source s of fund Own Source Date of Allotment/ Considerat ion Nature of issue Face value Issue Price/Acq % Preissue % Post 105

116 Transfer of fully paid- up shares No. of Equity shares uisition Price/Tran sfer Prices Cumulative no. of Equity shares paid up capital On MA/AA Cash Ordinary 1,500, ,500, Cash Share 2,195, ,695,000 % Ahmed Rajeeb Samdani issue paid up capital 7.78% Source s of fund Own Source Date of Allotment/ Transfer of fully paid- up shares Considerat ion Nature of issue No. of Equity shares Face value Issue Price/Acq uisition Price/Tran sfer Prices Cumulative no. of Equity shares On MA/AA Cash Ordinary 1,030, ,030, Cash Share 500, ,530,000 Hazera Hossain Date of Allotment/ Transfer of fully paid- up shares Considerat ion Nature of issue No. of Equity shares Face value Issue Price/Acq uisition Price/Tran sfer Prices Cumulative no. of Equity shares On MA/AA Cash Ordinary 1,030, ,030, Cash Share 255, ,285,000 % Preissue paid up capital % Post issue paid up capital 5.37% 3.22% % Preissue paid up capital % Post issue paid up capital 4.51% 2.71% Source s of fund Own Source Source s of fund Own Source Omar Khayam Date of Allotment/ Transfer of fully paid- up shares On MA/AA Considerat ion Cash Nature of issue Ordinary Share No. of Equity shares Face value Issue Price/Acq uisition Price/Tran sfer Prices Cumulative no. of Equity shares % Preissue paid up capital % Post issue paid up capital 1,000, ,000, % 2.11% Source s of fund Own Source Sheikh Omar Faruque Date of Allotment/ Transfer of fully paid- up shares On MA/AA Considerat ion Cash Nature of issue No. of Equity shares Face value Issue Price/Acq uisition Price/Tran sfer Prices Cumulative no. of Equity shares % Preissue paid up capital % Post issue paid up capital Ordinary Share 1,000, ,000, % 2.11% Source s of fund Own Source Kamrun Nahar 106

117 Date of Allotment/ Transfer of fully paid- up shares Considerat ion Nature of issue No. of Equity shares Face value Issue Price/Acq uisition Price/Tran sfer Prices Cumulative no. of Equity shares On MA/AA Cash Ordinary 1,000, ,000, Cash Share 150, ,150,000 % Preissue paid up capital % Post issue paid up capital 4.04% 2.42% Source s of fund Own Source Maya Rani Roy Date of Allotment/ Transfer of fully paid- up shares Considerat ion Nature of issue No. of Equity shares Face value Issue Price/Acq uisition Price/Tran sfer Prices Cumulative no. of Equity shares On MA/AA Cash Ordinary 900, , Cash Share 100, ,000,000 % Preissue paid up capital % Post issue paid up capital 3.51% 2.42% Source s of fund Own Source Hoda Ali Selim Date of Allotment/ Transfer of fully paid- up shares Considera tion Nature of issue No. of Equity shares Face value Issue Price/Acq uisition Price/Tran sfer Prices Cumulative no. of Equity shares On MA/AA Cash Ordinary 670, , Cash Share 330, ,000,000 % Preissue paid up capita l % Post issue paid up capital 3.51% 2.42% Sourc es of fund Own Source Nargis Mahmuda Date of Allotment/ Transfer of fully paid- up shares On MA/AA Considerat ion Cash Nature of issue Ordinary Share No. of Equity shares Face value Issue Price/Acq uisition Price/Tra nsfer Prices Cumulative no. of Equity shares % Preissue paid up capital % Post issue paid up capital 1,000, ,000, % 2.42% Source s of fund Own Source Phowzia Khan Date of Allotment/ Transfer of fully paid- up shares On MA/AA Considerat ion Cash Nature of issue Ordinary Share No. of Equity shares Face value Issue Price/Acq uisition Price/Tra nsfer Prices Cumulative no. of Equity shares % Preissue paid up capital % Post issue paid up capital 330, , % 0.69% Source s of fund Own Source (e) Detail of shares issued by the company at a price lower than the issue price; 107

118 All the shares are issued by the Company at face value of Tk (f) History of significant (5% or more) changes in ownership of securities from inception. There are no changes in ownership which indicates 5% or more change in ownership of securities from inception of the company SLICL. CHAPTER XIV: CORPORATE GOVERNANCE: a) Management disclosure regarding compliance with the requirements of Corporate Governance Guidelines of Bangladesh Securities and Exchange Commission; The Company declares that it is in compliance with the requirements of the applicable regulations of Corporate Governance Guidelines of BSEC in respect of corporate governance including constitution of the Board and committees thereof. The corporate governance framework is based on an effective independent Board, separation of the Board s supervisory role from the executive management team and constitution of the Board Committees, as required under applicable law. Sd/- Ajit Chandra Aich Managing Sonali Life Insurance Company Limited 108

119 (b) Compliance report of Corporate Governance requirements certified by Artisan. Certificate of Compliance to the Shareholders Of SONALI LIFE INSURANCE COMPANY LIMITED On the Conditions of Corporate Governance Guidelines We have reviewed the statement of compliance of conditions of Corporate Governance Guidelines prepared by the management of Sonali Life Insurance Company Limitedto comply with the Notification No. SEC/CMRRCD/ /134/Admin/44 dated 7 th August 2012 of Bangladesh Securities and Exchange Commission (BSEC) and subsequent amendments made thereon. The responsibility for compliance with the conditions of Corporate Governance Guideline is that of the Board of s of the Company. Our responsibility is to review, to the extent where such compliance can be objectively verified, whether the statement of compliance reflects the status of the Company s compliance with the provisions of the conditions of Corporate Governance Guidelines and report if it does not. Based on our review, we certify that nothing has come to our attention which causes us to believe that the Statement of Compliance does not appropriately reflect the Company s compliance, in all material respects, with the best practices contained in the Conditions of Corporate governance as applicable to the Company for the year ended 30 th June, Dhaka, 14 th August, 2018 sd/- Md. Selim Reza FCA FCS Partner ARTISAN Chartered Accountants 109

120 CORPORATE GOVERNANCE COMPLIANCE REPORT Status of compliance with the conditions imposed by Bangladesh Securities and Exchange Commission s Notification No. SEC/CMRRCD/ /134/Admin/44 dated 07 August, 2012 issued under section 2CC of the Securities and Exchange Ordinance, 1969 is presented below: Condition No. Title 1. BOARD OF DIRECTORS (BoD): 1.1 (Report under Condition No. 7.00) Board s Size (number of Board members minimum 5 and maximum 20) 1.2 Independent s: 1.2(i) At least one fifth (1/5) of the total number of s shall be Independent s 1.2(ii) Independent means a director: Compliance Status (Put in the appropriate column) Not Complied complied Remarks (If any) There are 12 (twelve) s in the Board of the Company. The Company has appointed 3 (three) Independent s 1.2(ii) (a) Who either does not hold any share in the company or holds not less than one percent (1%) shares of the total paid-up shares of the company In practice Who is not a sponsor of the company and is not connected with the company s any sponsor or or shareholder who holds one percent 1.2(ii) (b) (1%) or more shares of the total paid-up shares of the company on the Do basis of family relationship. His/her family members also should not hold above mentioned shares in the company 1.2(ii) (c) Who does not have any other relationship, whether pecuniary or otherwise, with the company or its subsidiary/associated companies Do 1.2(ii) (d) Who is not a member, director or officer of any stock exchange Do 1.2(ii) (e) Who is not a shareholder, director or officer of any member of stock exchange or an intermediary of the capital market Do 1.2(ii) (f) Who is not a partner or executive or was not a partner or an executive during the preceding 3 (three) years of the company s statutory audit firm Do 1.2(ii) (g) Who shall not be an independent director in more than 3 (three) listed companies Do 1.2(ii) (h) Who has not been convicted by a court of competent jurisdiction as a defaulter in payment of any loan to a bank or Non-Bank Financial Do Institution (NBFI) 1.2(ii) (i) Who has not been convicted for a criminal offence involving moral turpitude Do 1.2 (iii) Independent (s) shall be appointed by the board of directors and approved by the shareholders in the Annual General Meeting (AGM) Do 1.2 (iv) The post of Independent director(s) cannot remain vacant for more than 90 (ninety) days None Do 1.2 (v) The Board shall lay down a code of conduct of all Board members and annual compliance of the code to be recorded Do 1.2 (vi) The tenure of office of an Independent shall be for a period of 3 (three) years, which may be extended for 1 (one) term only Do 1.3 Qualification of Independent (ID) 1.3(i) Independent shall be a knowledgeable individual with integrity The qualification and background of IDs who is able to ensure compliance with financial regulatory and corporate justify their abilities as laws and can make meaningful contribution to business such 1.3(ii) Independent directors should be a Business Leader / Corporate Leader/Bureaucrat/University Teacher with Economics or Business Studies or Law background/professionals like Chartered Accountants, Cost & Management Accountants, and Chartered Secretaries. The -do- Independent must have at least 12 (twelve) years of corporate management/professional experiences 1.3(iii) In special cases the above qualifications may be relaxed subject to prior approval of the commission None 110

121 1.4 The Chairman of the Board and the Chief Executive Officer (CEO) shall be different individuals. The Chairman shall be elected from among the s. The Board of s shall clearly define respective roles and responsibilities of the Chairman and the CEO 1.5 The s Report to Shareholders 1.5(i) Industry outlook & possible future development in the industry In practice 1.5(ii) Segment- wise or product- wise performance -do- 1.5(iii) Risks and concerns -do- 1.5(iv) A discussion on Cost of Goods sold, Gross Profit and Net Profit Margin -do- 1.5(v) Discussion on continuity of any Extra-Ordinary gain or loss -do- 1.5(vi) Basis for related party transactions- a statement of all related party transactions should be disclosed in the Annual report -do- 1.5(vii) Utilization of proceeds from public issues, rights issues and/or through any others instruments N/A -do- 1.5(viii) An explanation if the financial results deteriorate after the company goes for IPO, RPO, Rights offer, Direct listing etc. None -do- 1.5(ix) If significant variance occurs between quarterly Financial Performance and Annual Financial Statement & Management explanation thereof None -do- 1.5(x) Remuneration to directors including independent directors -do- 1.5(xi) The financial statements present fairly its state of affairs, the result of its operations, cash flows and changes in equity -do- 1.5(xii) Proper books of accounts have been maintained -do- 1.5(xiii) Adaption of appropriate accounting policies & estimates -do- 1.5(xiv) IAS/BAS/IFRS/BFRS, as applicable in Bangladesh, have been followed and adequate disclosure for any departure -do- 1.5(xv) The system of internal control is Sound in design and has been effectively implemented & monitored -do- 1.5(xvi) Going Concern (ability to continue as a going concern) -do- 1.5(xvii) Highlight and explain significant deviations from the last year s operating results -do- 1.5(xviii) Key operating and financial data of at least preceding 5 (five) years shall be summarized -do- 1.5(xix) Reason for non declaration of Dividend Dividend declared 1.5(xx) The number of Board meetings held during the year & attendance by Included in the each s Report 1.5(xxi) Pattern of shareholding and name wise details (disclosing aggregate number of shares): 1.5(xxi) Included in the Parent/Subsidiary/Associated Companies and other related parties (a) s Report 1.5(xxi) (b) s, Chief Executive Officer (CEO), Company Secretary (CS), Chief Financial Officer (CFO), Head of Internal Audit (HIA) and their spouses and minor children 1.5(xxi) (c) Executives -do- 1.5(xxi) Shareholders holding ten percent (10%) or more voting interest in the (d) company -do- 1.5 (xxii) In case of appointment/re-appointment of a, disclose: 1.5(xxii)(a) a brief resume of the 1.5(xxii)(b) nature of his /her expertise in specific functional areas 1.5(xxii)(c) Name of companies in which the person also holds the directorship and the membership of committees of that Board. 2. CHIEF FINANCIAL OFFICER(CFO), HEAD OF INTERNAL AUDIT (HIA) AND COMPANY SECRETARY(CS): 2.1 Appointment of CFO, HIA and CS and defining their respective roles, responsibilities & duties 2.2 The CFO and CS shall attend the meetings of the Board of s 3. AUDIT COMMITTEE: 3(i) The Company shall have an Audit Committee as a sub-committee of the Board of s -do- 111

122 The Audit Committee shall assist the BoD in ensuring that the financial 3(ii) statements reflect true and fair view of the state of affairs of the company and in ensuring a good monitoring system within the business The Audit Committee shall responsible to the BOD. The duties of the 3(iii) Audit Committee shall be clearly set forth in writing 3.1 Constitution of the Audit Committee 3.1 (i) The Audit Committee shall be composed of at least 3 (three) members 3.1 (ii) The BOD shall appoint members of the Audit Committee who shall be directors of the company and shall include at least 1 (one) independent director. All members of the audit committee should be financially literate and at 3.1 (iii) least 1 (one) member shall have accounting or related financial management experience Expiration of the term of service of Audit Committee members making the 3.1 (iv) number lower than 3 (three) and fill up the vacancy(ies) by the Board not None later than 1 (one) month from the date of vacancy(ies) 3.1 (v) The Company Secretary shall act as the Secretary of the Audit Committee 3.1 (vi) The quorum of the Audit Committee meeting shall not constitute without at least 1 (one) independent director 3.2 Chairman of the Audit Committee 3.2 (i) The BoD shall select the Chairman of the Audit Committee, who shall be an Independent 3.2 (ii) Chairman of the audit committee shall remain present in the AGM 3.3 Role of Audit Committee 3.3 (i) Oversee the financial reporting process 3.3 (ii) Monitor choice of accounting policies and principles 3.3 (iii) Monitor Internal Control Risk management process 3.3 (iv) Oversee hiring and performance of external auditors 3.3 (v) Review the annual financial statements before submission to the Board for approval 3.3 (vi) Review the quarterly and half yearly financial statements submission to the Board for approval 3.3 (vii) Review the adequacy of internal audit function 3.3 (viii) Review statement of significant related party transactions submitted by the management 3.3 (ix) Review Management Letters/Letter of Internal Control weakness issued by statutory auditors 3.3 (x) Disclosure to the Audit Committee about the uses/applications of funds raised through IPO/RPO/Right Issue proceeds. None 3.4 Reporting of the Audit Committee Reporting to the Board of s (i) Reporting to BoD on the activities of the Audit Committee (ii) Reporting to BoD by Audit Committee (ii) (a) Reporting to BoD on conflicts of interests None (ii) Reporting to BoD on any fraud or irregularity or material defect in the (b) internal control system None (ii) Reporting to BoD on suspected infringement of laws, including securities (c) related laws, rules and regulations None (ii) (d) Reporting to BoD on any other matter None Reporting to BSEC (if any material impact on the financial condition & results of operation, unreasonably ignored by the management) None 3.5 Reporting to the Shareholders of Audit Committee activities, which shall be signed by the Chairman and disclosed in the Annual Report 4. EXTERNAL/STATUTORY AUDITORS: Audit Committee comprises of 3 (three) members One members are Independent No vacancy occurred No. IPO/RPO/Right issue was made in the year

123 4 (i) Non-engagement in appraisal or valuation services or fairness opinions 4 (ii) Non-engagement in designing and implementation of Financial Information System As per Auditor s declaration -do- 4 (iii) Non-engagement in Book-keeping or other services related to the accounting records or financial statements -do- 4 (iv) Non-engagement in Broker-dealer services -do- 4 (v) Non-engagement in Actuarial services -do- 4 (vi) Non-engagement in Internal Audit services -do- 4 (vii) Non-engagement in any other services that the Audit Committee determines -do- 4 (viii) No partner or employees of the external audit firms shall possess any share of the company during the tenure of their assignment -do- 4(ix) Non-engagement in audit/certification services on compliance of corporate governance as required under clause (i) of condition No. 7 -do- 5. SUBSIDIARY COMPANY: 5. (i) Provisions relating to the composition of the BoD of the holding company Sonali Life Insurance Company Limited does shall be made applicable to the composition of the BoD of the subsidiary not have any subsidiary company company 5. (ii) At least 1 (one) Independent on the BoD of the holding company shall be a director on the BoD of the subsidiary company 5. (iii) The minutes of the Board meeting of the subsidiary company shall be placed for review at the following Board meeting of the holding company 5. (iv) The minutes of the respective Board meeting of the holding company shall state that they have reviewed the affairs of the subsidiary company also 5. (v) The Audit Committee of the holding company shall also review the financial statements, in particular the investments made by the subsidiary company 6. THE CEO AND CFO SHALL CERTIFY TO THE BOARD THAT THEY HAVE REVIEWED FINANCIAL STATEMENTS FOR THE YEAR AND THAT TO THE BEST OF THEIRKNOWLEDGE AND BELIEF: 6.(i) (a) these statements do not contain any materially untrue statement or omit any material fact or contain statements that might be misleading these statements together present a true and fair view of the company s 6.(i) (b) affairs and are in compliance with existing accounting standards and applicable laws There are, to the best of knowledge and belief, no transactions entered 6 (ii) into by the company during the year which are fraudulent, illegal or violation of the company s code of conduct 7. REPORTING AND COMPLIANCE OF CORPORATE GOVERNANCE: Obtaining certificate from a practicing Professional Accountant/Secretary 7. (i) regarding compliance of conditions of Corporate Governance Guidelines of the BSEC and include in the Annual Report 7. (ii) s statement in the directors report whether the company has complied with these conditions The CEO and CFO have duly certified to the Board -do- -do- Certified by ARTISAN, Chartered Accountants Included in the s Report 113

124 (c) Details relating to the Issuer's Audit Committee and Remuneration Committee, including the name of committee members and a summary of terms of reference under which the committee operate Background AUDIT COMMITTEE REPORT In accordance to the best practices of Corporate Governance as per Notification of Bangladesh Securities and Exchange Commission (BSEC) No.SEC/CMRRCD/ /129/Admin/43 dated 7 August 2012, issued under section 2CC of the Securities and Exchange Ordinance, Composition of the Audit Committee The Audit Committee is now composed of the following member Mr. Quazi Moniruzzaman Mrs. Fauzia Quamrun Tania Mr. Sheikh Mohammed Danial Chairman Member Member The Chief Financial Officer (CFO) Mr.Mir Rashed Bin Aman and Head of Internal Audit Mr. Shah Abu Khairattend the meeting by invitation only as and when necessary. The Company Secretary Mr.Md. Rafe Uz-Zaman the functions as thesecretary of the Audit Committee. Meeting During the year ended 8 th August 2018, the Audit Committee held one meeting. Proceedings of the Audit Committee Meetings were reported regularly to the Board of s. The details of attendance of the Audit Committee Members have been shown as below: Audit committee meeting and attendance during the year ended 8 th August 2018 Name of Members No. of Meeting held No. of Meeting attended Mr. Mr. Quazi Moniruzzaman 1 1 Mr. Mrs. Fauzia Quamrun Tania 1 1 Mr. Sheikh Mohammed Danial 1 1 Role of the Audit Committee The Audit Committee assisted the Board of s in fulfilling its responsibilities regarding the Company s accounting and financial reporting process by monitoring the following: The integrity of the Company s financial statements The independence, qualifications and performance quality of its external auditors The Company s system of internal controls 114

125 The performance of the Company s internal audit process The Company s compliance with laws, regulations and codes of conduct with a view to safeguard the interest of all stakeholders of the Company Summary of Activities The Audit Committee carried out the following activities during the financial year for the period of 1 st January, 2018 to 30th June, 2018 Regularity Compliance The Committee examined whether the Company s procedures are in place to ensure compliance with The laws and regulations framed by the regulatory Authorities Internal regulations approved by the Board of s. The Company is duly following the rules and regulations of the Regulatory bodies and also strictly follows areas with conflict of interest. The Committee was satisfied that the Company substantially complied with these regulatory requirements. Approval of Financial policy & Procedures Financial policy & procedures have been approved by the Board of s. Financial Reporting The Committee assisted the Board of s and the management to carryout their responsibilities of preparing true and fair financial statements in accordance with the books of accounts and Bangladesh Accounting Standards (BAS) by: Reviewing the adequacy and effectiveness of the internal control system and procedures in order to provide responsible assurance that all transactions are accurately and completely recorded in the books of accounts. Reviewing the integrity of the process by which financial statements are prepared from the books of account. Reviewing the process by which compliance of provision of Bangladesh Accounting Standards. The Committee also reviewed The quarterly, half yearly and financial statements of the Company prior to recommending them for the approval by the board. The annual audited financial statements of the company with external auditors prior to submission to the Board for approval. The review focused particularly on changes of accounting policy and compliance with applicable accounting standards as adopted in Bangladesh and other legal & regulatory requirements. 115

126 External Audit The Committee met with the external auditors at the conclusion of the annual audit and exchanged views on their Audit report. The Committee reviewed the findings and recommendations made by the external auditors in order to remove the weaknesses as detected in the external auditing process. The Committee reviewed the performance of the auditors and recommended to the Board on their appointment and fees. Approval of Financial Statements The Audit committee reviewed and examined the Annual Financial Statements 2018 prepared by the Management and audited by the External Auditors Ahamed Akther & Co. Chartered Accountants and recommended to place the same before the Board for consideration. The Board approved the Annual Financial Statements at its Board meeting. Acknowledgement The Board of Audit Committee expressed its sincere thanks to the Chairmanand members of the board, management and the auditors for their support in carrying out its duties and responsibilities effectively. On behalf of the Audit committee, Sd/- Mr. Quazi Moniruzzaman Chairman of Audit committee 116

127 CHAPTER XV: VALUATION REPORT OF SECURITIES PREPARED BY THE ISSUE MANAGER: (a) The valuation report of securities offered is prepared and justified by the Issue Manager on the basis of the financials and all other information pertinent to the issue; The valuation report of the securities is prepared and justified by the issue manager on the basis of the financial and all o ther information pertaining to the issue. (b) To prepare the valuation report, the issue manager may consider all qualitative and quantitative factors which shall be explained in details with rationale to consider such factors, the valuation methods used, sources of information and authenticity of such information; The issue manager considered the following qualitative and quantitative factors to prepare the valuation report: Qualitative factors Experienced, Highly committed and Professional management team Visionary Board of s Favorable government policies for insurance sector Good track record for claim settlement Operational efficiency Quantitative factors Information presented in this prospectus are derived fromaudited financial statements for the period ended on 30 June, 2018 (06 months) and the year ended on 31 December, 2017,2016, 2015, 2014 and 2013 as prepared in accordance with BAS and BFRS. The company has done the Actuarial Valuation of its Life Insurance business considering the audited financial statement for the period ended on 31 December Therefore, in the calculation of Asset based valuation of the company, we have taken financial information from the audited financial statement of Net Asset Value (NAV) per share as on 31 December, 2017 Actuarial valuation as on 31 December, 2017 Averagemonthly price of 05 similar stocks (Life insurance companies, listed in DSE) for last 12 months (from October 17 to September 18) has been considered in the calculation of Similar stock based valuation (c) While preparing the valuation report, the issue manager shall avoid exaggeration and biasness and shall exercise independence and due diligence; The Issue Managers avoided exaggeration and biasness and exercised independence and due diligence in preparing valuation report. (d) Valuation under different methods as prescribed in clause no. Annexure-E(B)(14) of Bangladesh Securities and Exchange Commission (Public Issue) Rules, 2015 Sl. No. Summary of valuation of Sonali Life Insurance Company Limited Method Used Price (amount in Tk.) Method- 1 Net Asset Value per Share based valuation (with Actuarial Valuation) Method- 2 Average Market Price of Similar stock based valuation

128 Justification of the valuation of share price of Sonali Life insurance Company Limited Method- 1: Net Asset Value per Share based valuation (with Actuarial Valuation) According to the actuarial valuation, the value per ordinary share of Sonali Life Insurance Co Ltd as on 31 December 2017 based on Net Assets Value (NAV) is Tk as worked out below: Particulars Amount in Tk. Total realizable assets 68,871, Less: Total liabilities 314,484, Net Assets 254,386, Number of ordinary shares issued 18,000, Value per ordinary share Note: Total realizable assets = Property and assets preliminary expenses - deferred expenses Total liabilities = (Capital and liabilities + net policy liabilities) (paid up capital + life insurance fund) Net Policy Liabilities taken from the valuation report as at i.e. Tk. 178,687, No actuarial valuation is made after 31 December According to section 13 (1) of Insurance Act 1938, valuation report of life insurance business is valid up to two years. Therefore, value per share has been calculated based on valuation report as on 31 December In the calculation of NAV, value of property &assets, preliminary expenses, deferred expenses, capital & liabilities, paid up capital, life insurance fund are taken from the Balance Sheet as at and Net Policy Liability is taken from Valuation report since no valuation report is made after Method- 2: Average Market Price of Similar stock based valuation Date Sunlife Ins. Co. Ltd. Rupali Life Ins. Co. Padma Life Ins. Co. Meghna Life Ins. Co. Pragati Life Co. Ltd. Ltd Ltd. Ltd. Sep Aug Jul Jun May Apr Mar Feb Jan Dec Nov Oct Average Average market price per share of similar stocks The offering price for the ordinary shares of Sonali Life Insurance Company Limited has been determined at par value of Tk each. 118

129 Sd/- Zafar Halim Actuary Fully Regulated Member of the UK Actuarial Profession 13 September,

130 Sd/- Zafar Halim Actuary Fully Regulated Member of the UK Actuarial Profession 13 September,

131 Sd/- Zafar Halim Actuary Fully Regulated Member of the UK Actuarial Profession 13 September,

132 Sd/- Zafar Halim Actuary Fully Regulated Member of the UK Actuarial Profession 13 September,

133 123

134 124

135 125

136 CHAPTER XVI: DEBT SECURITIES The Company neither issued nor is planning to issue any debt security within next six months. 126

137 CHAPTER XVII: PARTIES INVOLVED AND THEIR RESPONSIBILITIES Parties involve with Sonali Life Insurance Company Limited (a) Issue Manager ICB Capital Management Limited Agrani equity & Investment Limited Responsibilities The Issue Managers are responsible to comply with all the requirements as per Bangladesh Securities and Exchange Commission (Public Issue) Rules 2015 including preparation and disclosures made in the prospectus, Roadshow and other responsibilities as mentioned in the due diligence certificate (b) Underwriters ICB Capital Management Limited The Underwriter(s) is responsible to underwrite the public offering on a firm- commitment basis as per requirement of Bangladesh Securities and Exchange Commission (Public Issue) Rules In case of under-subscription in any category by up to 35% in an initial public offer, the unsubscribed portion of securities shall be taken up by the underwriter(s) (c) Statutory Auditor Ahadmed and Akther.. To express an opinion on financial statements of the auditor based on their audit. An auditor conducting an audit in accordance with Bangladesh Standards on Auditing (BSA) is responsible for obtaining reasonable assurance that the financial statements taken as a whole are free from material misstatements whether caused by fraud or error (d) Cost Auditor Not Applicable. Not Applicable. (e) Acturial Z Halim & Associates Actury is responsible for the accuracy of the valuation of policy liabilities of Sonali Life Insurance Company Limited as at 31 December, 2017 made for the purposes of the Abstracts prepared in accordance with the requirements of Section 160 of the Insurance Act, 2010(Part II of the Fourth Schedule of the Insurance Act,1938). (f) Credit Rating Agency WASO Credit Rating Company Credit Rating Company is responsible for conducting the long term and short-term rating of the company based on its financial statements and other relevant qualitative and quantitative information. Credit Rating Company shall publish the rating in its public website when it issues or updates a final rating. 127

138 CHAPTER XVIII: MATERIAL CONTRACTS: (a) Major agreements entered into by the Issuer. 1) Issue Management Agreement between the Company and ICB Capital Management Limited and Agrani Equity & Investment Limited; 2) Underwriter Agreement with ICB Capital Management Limited. (b) Material part of the agreements: Contract Material parts of the agreements Signing Date October 01, 2018 Issue Management Agreement with ICB Capital Management Ltd. Agrani Equity Tenure: Principal Terms and Condition: This Agreement shall be valid until completion of subscription of shares and unless this Agreement is extended or earlier terminated in accordance with the terms of this Agreement 1) According to Article 2.1; the scope of the services to be rendered by the ISSUE MANAGER to the ISSUER under this agreement shall cover Regulatory Compliance, Underwriting Co-operation, Issue Arrangements and Public offer and invitation. 2) According to Article 3.1 Without prejudiceissuer hereby declares that it agrees to comply with all statutory formalities under Companies Act, 1994, Guidelines issued by Bangladesh Securities and Exchange Commission and other relevant status to enable it to make the issue. 3) According to Article 4.1 Without prejudice to other stipulations relative to the responsibility of the ISSUE MANAGERS, it is responsible towards the COMPANY for strict compliance of this Agreement and to comply with all term therein. 4) According to Article 5.1 The Issuer shall payto Issue Managers at 1.00% on the public offer amount for the Issue Management Services. 5) According to Article 8.1 The Issue Manager shall ensure compliance of the Bangladesh Securities and Exchange Commission (Public Issue) Rules, 2015, Dhaka Stock Exchange (Listing) Regulations, 2015, Chittagong Stock Exchange (Listing) Regulations, 2015, and other relevant rules, regulations, practices, directives, guidelines, etc. 128

139 Contract Underwriting Agreement with ICB Capital Management Ltd. Material parts of the agreements Signing Date October 01, 2018 Tenure: Principal Terms and Condition: This Agreement shall be valid until completion of subscription of shares and unless this Agreement is extended or earlier terminated in accordance with the terms of this Agreement 1. In case of under-subscription in any category by up to 35% in an Initial Public Offer, the undersubscribed portion of securities shall be taken up by the underwriter. 2. In case of failure to deposit the remaining amount by the eligible investors, the unsubscribed securities shall be taken up by the underwriter. 3. The issuer, in the event of under subscription, shall send notice to the underwriter(s) within ten days of closure of subscription calling upon them to subscribe the securities and pay for this in cash in full within fifteen days of the date of said notice and the said amount shall be credited into securities subscription account within the said period. If payment is made by Cheque/ Bank Draft by the underwriter it will be deemed that the underwriter has not fulfilled his obligation towards his underwriting commitment under this agreement, until such time as the Cheque/ Bank Draft has been encased and the Company s account credited. In any case within 7 (seven) days after the expiry of the aforesaid 15 (fifteen) days, the Company shall send proof of subscription and deposit of money by the underwriter to the Commission. In the case of failure by the underwriter to pay for the shares under the terms mentioned above, the said underwriter will not be eligible to underwrite any issue, until such time as he fulfils his underwriting commitment under this Agreement and also other penalties as may be determined by the Commission may be imposed. In the case of failure by the underwriter to pay for the shares within the stipulated time, the Company/issuer will be under no obligation to pay any underwriting commission under this Agreement. In the case of failure by the Company to call upon the underwriter for the aforementioned purpose within the stipulated time, the Company and its s shall individually and collectively be held responsible for the consequences and/or penalties as determined by the Bangladesh Securities and Exchange Commission under the law. 4. The Company shall pay to the underwriter an underwriting commission at the rate of 0.20% of the amount underwritten hereby agreed to be underwritten by it. 129

140 Contract Registrar to the Issue Agreement Material parts of the agreements N/A (C) Fees Payable to different parties Manager(s) to the Issue fee ICB Capital Management Limited and Agrani Equity & Investment Limited are the Managers to the Issue. The Issue Managers will get 1% of the Issue size as issue management fee, i.e. BDT19.00 lac; Of this amount BDT lac will be paid to ICB capital Management Limited and BDT lac will be paid to Agrani Equity & Investment Limited. Commission for the Underwriters The company shall pay to the underwriters an underwriting commission at the rate of 0.50% of the IPO amount of the issue value of shares underwritten by them out of the Public Issue. Registrar to the Issue fee N/A Credit Rating fee The Credit rating of the Company is conducted by the Waso Credit Rating Ltd.and they got Tk. 200, as credit rating fee. 130

141 CHAPTER XIX: OUTSTANDING LITIGATIONS, FINE OR PENALTY: a) The following outstanding litigation against the issuer or any of its s and fine or penalty imposed by any authority: (i) Litigation involving Civil Laws (ii) Litigation involving Criminal Laws (iii) Litigation involving Securities, Finance and Economic Laws (iv) Litigation involving Labor Laws (v) Litigation involving Taxation (Income tax, VAT, Customs Duty and any other taxes or duties) (vi) Litigation involving any other Laws There is no outstanding litigation against the issuer or any of its s and fine or penalty imposed by any of the above authorities. b) Cases including outstanding litigations filed by the Company or any of its directors: (i) (ii) (iii) (iv) (v) (vi) Litigation involving Civil Laws: No cases filed by the company or any of its directors. Litigation involving Criminal Laws: No cases filed by the company or any of its directors. Litigation involving Securities, Finance and Economic Laws: No cases filed by the company or any of its directors Litigation involving Labor Laws: No cases filed by the company or any of its directors regarding some disallowances of expenses and adding back of arbitrary income Litigation involving Taxation (Income tax, VAT, Customs Duty and any other taxes/duties):there are no outstanding cases filed by the Company or any of its s relating to above litigations. Litigation involving any other Laws: No cases filed by the company or any of its directors. 131

142 CHAPTER XX: RISK FACTORS AND MANAGEMENT S PERCEPTIONS ABOUT THE RISKS: The disclosures of risk factors shall include the following: (i) Internal risk factors; (ii) External risk factors; (i) Internal risk factors may include, among others: (a) Credit Risk; Credit risk refers to the risk that a borrower may not repay a loan and that the lender may lose the principal of the loan or the interest associated with it. Credit risk arises because borrowers expect to use future cash flows to pay current debts; it's almost never possible to ensure that borrowers will definitely have the funds to repay their debts. Interest payments from the borrower or issuer of a debt obligation are a lender or investor's reward for assuming credit risk. Management perception The Issuer is planning to raise capital through IPO subject to approval of regulatory authority, which shall diversify the ca pital structure of the Company. The Company did not expose to any credit crunch in the past. Again the Company is regularly paying its debt obligation. So in this back drop it is expected that there are less exposure of credit risk which may be eroded the issuer s financial soundness and less possibilities to be credit defaulter in near future. (b) Liquidity Risk; Liquidity risk is the risk that the Company will not be able to meet its financial obligations as they falls due. Liquidity r isk arises due to insufficient fund to meet up short and long-term liability. Management perception The Company's approach to managing liquidity (cash and cash equivalents) is to ensure, as far as possible, that it will always have sufficient liquidity to meet its liabilities when due, under both normal and stressed conditions, without incurring unacceptable losses or risking damage to the Company's reputation. Typically, The Company ensures that it has sufficient cash and cash equivalents to meet expected operational expenses, including financial obligations through preparation of the cash flow forecast based on time line of payment of the financial obligation and accordingly arrange for sufficient liquidity/fund to make the expected payment within due date. Again, SLIC has sufficient premium income to meet any unforeseen claim or payment. So it is expected that liquidity risk shall not impact on the Issuer to a large extent to run the day to day business operation. (c) Risk associated with the issuer s interest in subsidiaries, joint ventures and associates; Return of investment of the holding Company may be eroded due to conflict of interest among the group or any significant fina ncial loss of the subsidiary and associates Company. Management perception The Company SLIC does not have any subsidiaries, joint venture and associates companies. So there are no such possibilities of arisen risk in this respect. (d) Significant revenue generated from limited number of customers, losing any one or more of which would have a material adverse effect on the issuer; The revenue of the Company exposed to hindrance due to significant portion of revenue generated from concentrated customer Management perception The Company SLIC is not dependent on any single customer. The Company has huge number of retail customer who regularly take insurance policies. The revenue of the Company is not concentrated neither to any single customer nor to any Group. 132

143 (e) Dependency on a single or few suppliers of raw materials, failure of which may affect production adversely; Interruption in raw material supply may impediment of smooth production process. Management perception The Company SLIC is delivering insurance service to its clients. The Company does not require any raw materials. (f) More than 20% revenue of the issuer comes from sister concern or associate or subsidiary; Revenue would be concentrated if it comes from sister concern or associate or subsidiary Company. Management perception The Company SLIC has no associate or subsidiary or sister concern. 100% of its revenue has come from customers. (g) Negative earnings, negative cash flows from operating activities, declining turnover or profitability, during last five years, if any; Any history of negative earnings, negative cash flows from operating activities, declining turnover or profitability may impede the confidence of the investors for future potentiality of the Company Management perception The Company has positive track record of earnings and cash flow from operation last five years and expected to hold this position in upcoming years. (h) Loss making associate or subsidiary or group companies of the issuer; The Company may exposed to risk of contagion which refers that the financial problem, especially insolvency, of one member of a group will bring about deterioration in the condition of all members. Management perception The Company has neither any associate nor subsidiary Company nor any group whichare making loss. So no risk shall be arisen in this respect. (i) Financial weakness and poor performance of the issuer or any of its subsidiary or associates; Financial performance have material impact on the sustainability of the Company as going concern. Management perception The Company has a proven track record on its financial fundamentals. Again the Company has no subsidiary or associate Company. So there are less scope of arising of such risk. (j) Decline in value of any investment; Investment value might rise or fall because of market conditions (market risk). Corporate decision, such as whether to expand into a new area of business or merge with another Company, can affect the value of investment Management perception The investment value was never declined. ROI of the Company during the last five years was positive. So it is expected that the trend of ROI in future shall be positive. (k) Risk associated with useful economic life of plant and machinery, if purchased in second hand or reconditioned; The Company shall not be able to operate its business longer period due to limited life of plant and machinery Management perception The Company SLIC provides life insurance related services. There are no requirement of plant and machinery to meet up of its regular business activity. (l) Adverse effect on future cash flow if interest free loan given to related party or such loans taken from directors may recalled; 133

144 There are possibilities of a holding Company to expand through the use of debt or leverage, building an intricate corporate structure which can include unrealized values, thus creating a risk if interest rates on obligations or the evaluation of assets posted as guarantee for loans alter radically Management perception The Company SLIC has sufficient liquid asset to meet up its liabilities. So there are less possibilities to be default. (m) Potential conflict of interest, if the sponsors or directors of the issuer are involved with one or more ventures which are in the same line of activity or business as that of the issuer and if any supplier of raw materials or major customer is related to the same sponsors or directors; Conflict of interest between the Issuer and its suppliers or major customer arise due to common management may create impediment in the day to day business operational process Management perception No sponsor or director holds any position or own any stake in the business of its supplier or customer. So no conflict would be arisen in this respect. (n) Related party transactions entered into by the Company those may adversely affect competitive edge; In many cases related party transaction are under taken in the course of the normal business of an entity, in view of the nat ure of related party relationships and transactions they may carry a higher risk about the ability of the Company to continue in business as a going concernif the entity s interest is constantly subordinated to that of related party. Sometimes related party relationships and transactions may be difficult to identify and reported by the entity and subject to increased risk of fraud due to extensive and complex network of relationship sometimes put in place to obfuscate control of the entity, making related party transactions difficult to unravel. Sometime risk arise in the related party transaction due to entity s information systems may not be effective in identifying and recording related party relationship and transaction. Management perception The Company provides adequate disclosures in the audited financial statements which is sufficient about its related party transaction. The above disclosure are presented in true and fair view of the Company s transaction with the related party. So there are no suc h possibilities of arise of conflict in this respect. (o) Any restrictive covenants in any shareholders' agreement, sponsors' agreement or any agreement for debt or preference shares or any restrictive covenants of banks in respect of the loan/ credit limit and other banking facilities; The future business process or revenue may hinder by any such restrictive covenants stipulated in the agreements with shareho lders, with sponsor or any loan agreement with the bank or financial institutes. Management perception There are no such restrictive covenants persist with any shareholders, sponsor or any bank loan facility. (p) Business operations may be adversely affected by strikes, work stoppages or increase in wage demands by employees; Every industry is operating mutually by workers and management mutual understanding. Owners are always concern about the workers demand. There were precedence in past regarding workers violence in street, huge vandalism and put fire on motor vehicle causes a serious damage of the Company properties. Sometimes workers demanded more salary and stopped work which also create financial loss to the Company. Management perception SLIC is a service oriented Company. There are no such worker for which the business operation of the Company was stopped. No situation arises in the Company in past in this respect. If any situation would arise among the employee, then owner and employee shall be settled down the situation with utmost considerable aspects. (q) Seasonality of the business of the issuer; Revenue of the Company would be affected if the business is seasonal. Management perception The business of the Company does not depend on any season as demand for insurance service is remain throughout the year. Therefore, the Company s revenue is not affected by any seasonal factor. 134

145 (r) Expiry of any revenue generating contract that may adversely affect the business; The revenue would be squeezed if any contract for which revenue generated had expired. Management perception There are no such contract for which the future revenue would be squeezed. (s) Excessive dependence on debt financing which may adversely affect the cash flow; The Company may expose to high degree of risk and its future cash flow from operation shall be squeezed due to financial expense. Management perception No excessive dependency on debt financing due to net worth is positive. Again the operating cash flow was positive last 5 years which indicates that the Company s cash generation capacity from operating activities is sufficient. (t) Excessive dependence on any key management personnel absence of whom may have adverse effect on the issuer s business performance; Key management personnel have key role in the organization for smooth operation of the Company. If key management personnel t urnover is high that will have adverse impact on the organizational day to day activities. Management perception Since inception of the Company, the employee rotation rate is low. The organizational structure is designed in such a way that there sha ll have no impact on Company s overall performance if any key management person changes in the organization. (u) Enforcement of contingent liabilities which may adversely affect financial condition; Contingent liabilities are likely to have a negative impact on a Company's stock share price because they threaten to reduce the Company's assets and net profitability. The extent of the impact on share price depends on the estimated probability of the contingent liabilities becoming actual liabilities. Management perception There are no contingent liabilities against the Company. (v) Insurance coverage not adequately protect against certain risks of damages; The Company shall expose to significant loss if its assets are not properly covered by insurance. Management perception There are sufficient insurance coverage for risks of damages (w) Absence of assurance that directors will continue its engagement with Company after expiry of lock in period; The Company may expose to certain risk to operate its day to day business operations if current directors engagement shall not continue after expiry of lock in period. Management perception As the directors of the Company are owner and are continuing from the inception of the company so it is expected that they will continue after the lock in period. (x) Ability to pay any dividends in future will depend upon future earnings, financial condition, cash flows, working capital requirements and capital expenditure; Any future dividend payment depends on the future revenue generation. Any negative earnings in future shall be hindered future financial stability of the Company. Management perception From existing business the Company shall earn significant revenue from which it will be possible to pay dividend regularly. I t is presumed that the Company shall be able to pay dividend in future from the existing business. 135

146 (y) History of non-operation, if any and short operational history of the issuer and lack of adequate background and experience of the sponsors; The Company may appear in disrupt of future operation if it had any non-operation history or short operational history which may repeated in future or lack of adequate background and experience of the sponsor have some operational risk due to complex nature of pr oblem shall not be resolved without having proper knowledge. Management perception The Company started its journey more than five years and has successfully been operating till date. Since its inception there are no history of non-operation. On the other hand all sponsors of the Company have vast experience in business. If any problem would arise, the sponsor would mitigate that the problem as usual manner. (z) Risks related to engagement in new type of business, if any; Entrepreneurs face many challenges when starting a new business. A depressed economy, uncertain market conditions and financial struggles all pose a legitimate threat to the successful launch of a new Company. Management perception The Company shall not engage in any new type of business by IPO proceeds rather investment in current business. ii) External risk Factors (aa) Risk in investing the securities being offered with comparison to other available investment options; The Company would be exposed off potential financial distress if return on invest is low compare to alternative investment options they have. Management perception No other investment option that the Company has been considered except the fund utilizations as described in the section xxii under the head Use of proceeds. (bb) Any penalty or action taken by any regulatory authorities for non-compliance with provisions of any law; The Company shall have risk to expose of eroded its brand name and goodwill in case of penalty or action taken by the regulat ory authority. Management perception Presently, there are no regulatory penalty or action taken by any regulatory authorities for non-compliance with provisions of any law. On the other hand SLIC has good record from IDRA (Insurance Development and Regularity Authority). The Company SLIC did not expose to any such penalty from its inception. So the management of the Company alleged that there are little scope of arising such risk in near future. (cc) Litigations against the issuer for Tax and VAT related matters and other government claims, along with the disclosures of amount, period for which such demands or claims are outstanding, financial implications and the status of the case; Any litigation in terms of unsettled tax, VAT or any other Govt. claim may hamper business operation of The C ompany as well as may create future potential financial losses. Management perception There are no litigation against the Company. (dd) Registered office or factory building or place of operation is not owned by the issuer; 136

147 If office and factory location is not owned by the Company business operation may hamper. Management perception The Registered office and the place of operation of the company is under rent from third party. The company has agreement of ten years with the landlord and the agreement is renewable. So, there is least possibility of arising any risk related to office space. (ee) Lack of renewal of existing regulatory permissions or licenses; Non-renewal of license may hamper day-to-day business operation of the Company. Management perception All licenses are valid and up dated. The management of the Company always takes timely steps to renewal of all its regulatory licenses. So scope of arising any risk in this respect is low. Failure in holding AGM or declaring dividend or payment of interest by any listed securities of the issuer or any of its subsidiaries or associates; There may have legislative impact on business operation of any group Company by any judgment of Honorable High court in case of failure of any listed Company of the group for not comply with the state laws such as The Companies Act 1994 or payment of dividend to t he shareholders in due course. Management perception The Issuer has no listed securities, subsidiaries, or associates Company who fail to hold AGM or declaring dividend or payment of interest. So there are less possibilities to arise any risk in this respect. (gg) Issuances of securities at lower than the IPO offer price within one year; If the Issuer issues share at lower than the IPO offer price within one year, there will have possibilities to arise misperception about IPO price. Management perception The Company does not issue any securities at lower than the IPO offer price within one year. (hh) Refusal of application for public issue of any securities of the issuer or any of its subsidiaries or associates at any time by the Commission. Any refusal of application for public issue of any securities of the issuer may hinder confidence of the Compan y or convey negative impression about the financial status to the shareholders. Management perception The Company SLIC has not faced any refusal of application for public issue of any securities at any time by the commission. (ii) External risk factors may include among others: Investment in capital market involves exposure to several types of risks. Sonali Life Insurance Company Limited operates in an industry that is exposed to several external risk factors over which the Company has little or no control. The following includes some of the significant risk factors that may affect the value of the company s shares. Hence, a rational investor should carefully consider all the information contained in this prospectus including the risk factors elaborated below. (a) Interest rate risks; Volatility of money market may influences the overall interest rate structure of the country. So, any unfavorable change in interest rate structure may affect the company s business adversely. Management perception The Company invests in securities and has deposits that are subject to interest rate risk. Interest rate risk to the Company is t he risk of changes in market. Interest rate reducing the overall returns on its interest basis securities. The Company limits inter est risk by monitoring changes in interest rates in the money market and by diversifying into various institutions (issuers of securities). 137

148 (b) Exchange rate risks; Exchange rate risk arises from currency fluctuation in international trade. If Bangladeshi Taka is devalued and/or foreign currency revalued than the price of imported raw materials will go up which will decrease the overall profit margin. Taka has been devalued sig nificantly against dollar and it is very unlikely of any immediate appreciation of Taka. Management perception Since SLICis not engaged into any insurance business in foreign currency, exchange rate risk is not relevant here. (c) Industry risks; Industry risk arises due to risk associated with business and macro-economic factors of the industry such as labor unrest, shortage of power, rising of raw material cost or shortage of raw material supply etc. If risk factor pertaining to industry is high, the growth of the industry shall be lower or may be eroded the entire potentiality of that industry. Management perception The Company is operating in a highly competitive industry. Presently, 32 life insurance companies including the JBC are operating in the country. SLIC has to face stiff competition arising from the existing 31 life insurance companies excluding JBC. The Company has successfully accessed the market till date with a proactive approach by a group of professional and vast experienced peoples. Therefore the Company is working on offering services at competitive terms. Despite the extreme competition, SLIC s business operation shows satisfactory performance. (d) Economic and political risks; Economic risk Economic risk arises due to some various factors such as political or regulatory policy change, including adverse impact of g lobalization, social disturbances due to political unrest, terrorist attacks and other acts of violence or war, natural calamities, Commodity and hike commodity & energy prices and various other factors. The consequence of economic risk is that the growth of development may be eroded or hampered and any significant changes may adversely effect on business and profitability of the Company. Management perception: Bangladesh economy is booming for last few years. Consistent industrial growth along with increased agricultural production has made the per capita income higher than that of recent years. In addition, favorable government policies and industry friendly policies by other regulatory bodies have proved to be congenial to the economy of the country. Bangladesh has been considered to be next emerging country in terms of economic development. This indicates the future potentiality of our country s economic strength. Despite of some economic shortfall, Bangladesh economy is going to be stands on a strong platform in terms of micro and macro economy indicators such as inflation, exchange rate, foreign reserve, GDP growth, per capital income, domestic demand, Labor rate etc. Management of the Company has keen fo cus on the economic movement of the country and shall be take decision accordingly to adjust any unfavorable situation in this respect Political risk The risk that an investment returns could suffer as a result of political changes or instability in a country. Instability af fecting investment returns could stem from a change in government, legislative bodies, other foreign policy makers, or military control Management perception The management of the Company believes that more effective management of political risk shall help the companies in protection of their investments and shall improve the performance of business operation. Management perceives that, this requires more integration of political risk management into a systematic process as well as shall have to be embedded in a company s other business processes. The management of the Company is fully aware of the potential risk related with political outcome and accordingly they have taken several safe guard to prevent the financial loss of the Company. (e) Market and Technology Market risks The company continues to adopt a prudent policy in respect of investments. The investments are mainly in Govt. securities. Fixed Deposits Receipts (FDR s) with various commercial banks and financial institutions having acceptable performance parameters and rating s and equity shares in listed companies having good and positive fundamental and technical attributes. 138

149 The Company also limits market risk maintaining a diversified profile and by continuous monitoring of developments in Govt. securities (bonds) equity and term finance certificates markets. Management perception Insurance business globally is increasing. Industrialization and other infrastructure of the country are remarkably developin g; as such the general insurance business is increasing day by day. New items are coming under the cover of insurance. The market is expanding as people are realizing the importance of insurance. Because of the company s excellent services and introduction of new products, the Company faces low risk related with market. Technology-related risks Technology is a continuous process of development. Innovation of new and cost effective technology may obsolete existing technology, which may cause negative impact on the business. The operation of the Company is capital intensive and the qualit y of the products is directly related to the sophistication of the machinery in use. In case, the technology of the machineries becomes obsolete, cost advantage and quality of production of the Company may be affected adversely. Management perceptions The Company believes that there is very low probability that the technology change may adversely impact on the Companies Business operation. (f) Potential or existing government regulations; The development of the industry is mostly depends on government support. If Government fiscal and monetary policy is unfavorable towards the Insurance industry, the growth and development of this sector would not be possible. Management Perceptions The Government of Bangladesh is highly concentrated on economic development of the Country through industrialization. Bangladesh has been considered the most emerging economy country which economy is growing continuously. As progress ofeconomy is continuing, the others sub sectors also improving. By this way insurance sector shall be developed as new business opportunity has been created through economic progress. The Management of SLIC perceives that these facilities shall remain in near future, which shall have positively impact on development of insurance industry of our Country. (g) Potential or existing changes in global or national policies; The Company operates in an insurance industry. At present, government policy and global business situation is favorable for d evelopment in this sector. If any change in this condition, the profitability of the Company shall be affected. Management perception Insurance sector is a vital sector for the economic development of Bangladesh. The government incentives and subsidies are al so vital to the sustainability of this sector. The Government of Bangladesh is aware of this fact. Hence, it is not expected that any undue tax or duty will be imposed that may adversely affect the sector s sustainability. Rather, the Government is keen to support the industry. Again any changes in the policy of international trade and may adversely affect the all global nations. So in that case the management of SLIC shall reset their policy according to the global policy changes. (h) Statutory clearances and approvals those are yet to be received by the issuer; To smooth running of the business operation, statutory clearance is required. The Company has to comply with several specific regulations of its primary regulator i.e., Insurance Development and Regulatory Authority (IDRA). Any non-compliance of its rules and regulation may impede the Initial Public Offering Process. Management perception The Management of SLIC has been aware about the rules and regulations of their primary regulator i.e., Insurance Development and Regulatory Authority (IDRA. The Management of SLIC believes that if there any statutory clearance required in future in any manner, they shall approach to the regulator in due course. 139

150 (i) Competitive condition of the business; In Bangladesh, during the 1970s, government-owned JBC and SBC were the only provider of life and general insurance coverage for individual and business properties. During that time insurance products were very few in number and the industry did not take innovative efforts for product development. In the country the first private insurance Company was set up in Since then non-government insurers have shown rapid growth in terms of institutional set-up, policy design and business expansion. When non-government insurers gradually have gained the foothold in the country, real competition in the sector has begun. However, the insurance industry in Banglad esh is very small compared to its economy and the number of insurance policyholders is still not increasing satisfactorily. At present, there are 45 general (non-life) insurance and 32 life insurance companies are operating in Bangladesh, which are inadequate to provide insurance services to about 160 million people. Insurance is a form of risk management, used to hedge against the risk of a contingent loss. It involves the transfer of the risk of potential loss from one entity to another, in exchange for a risk premium. Given this role, the insurance sector fosters financial stability by enabling economic agents to undertake various transactions with the facility of transfer and dispersion of risks. As a crucial component of the financial system, life insurance plans are an important source of savings and long-term institutional investments essential for the development and growth of bond markets. The role of insurance as a financial intermediary is particularly important in countries like Bangladesh with low levels of financial penetration. Management perception As well as the problems mentioned above, there are many good signs for the insurance business in Bangladesh. The factors that can facilitate the insurance business in our country are discussed below. These facts can be measured as the prospective fields f or insurance business in Bangladesh. Higher GDP The GDP of our country is increasing than the previous years, which results in increase of per capital income. Therefore, this growing GDP and income holds bright prospects for life insurance companies. New business s individual insurance There are so many new businesses starting every day and manufacturing sector is booming with global demand. Every business s employees are insured under a life insurance Company to protect its employees from any financial loss. Therefore growing industry, mill,factories are creating better scope for the life insurance companies to flourish their business. Developing mass awareness about insurance People are now much more conscious about their safety. So they are encouraged to take an insurance policy for making their life free from any unexpected occurrence. Increase in literacy rate is helping predominantly to create awareness among the people regarding taking insurance policy. Besides this insurance companies are also trying to eradicate the negative attitude of people toward s the insurance Company by organizing various programs such as seminars, programs including social responsibilities etc. (j) Complementary and supplementary products or services, which may have an impact on business of the issuer. Complementary and supplementary product may have impact on sale of the existing product of the Company. Management perception SLICL provides insurance services which has no supplementary or complementary product at all to its users. 140

151 CHAPTER XXI: DESCRIPTION OF THE ISSUE: a) Issue Size: raising fund of BDT c66rore. (b) Number of securities to be issued; Public issue of SLICL is 19,000,000 ordinary shares. (c)authorized capital and paid-up capital; Authorized capital: Tk. 1,000,000, Paid-up capital: Tk 285,000, (d) Face value, premium and offer price per unit of securities; Face Value: Tk Offer Price: Tk (e)number of securities to be entitled for each category of applicants; Offering of 19,000,000 ordinary shares, of these ordinary shares 50% i.e. 9,500,000 ordinary shares are reserved for Eligible Investor (EI) which includes 40% i.e. 7,600,000 ordinary shares for EI excluding Mutual Funds and CIS and 10% i.e. 1,900,000 ordinary shares for Mutual Funds and CIS and remaining 50% i.e. 9,500,000 ordinary shares for General Public including NRB at the issue price of Tk (at per) totaling BDT 190,000, No of ordinary shares Percentage of holding SL Shareholding Category Pre-Issue IPO Post-Issue Pre-Issue Post-Issue (a) (b) (a+b) 1 Sponsors and s 28,500,000-28,500, % 60% 2 Institutional - 9,500,000 9,500,000-20% 3 Public - 9,500,000 9,500,000-20% Total 28,500,000 19,000,000 47,500, % 100% Eligible investor (EI) General public Mutual Funds& CIS EI excluding mutual fund and CIS NRB GP excluding NRB % No. of Shares % No. of Shares % No. of Shares % No. of Shares 10% 1,900,000 40% 7,600,000 10% 1,900,000 40% 7,600,000 (f) Holding structure of different classes of securities before and after the issue; No of ordinary shares Percentage of holding SL Shareholding Category Pre-Issue IPO Post-Issue Pre-Issue Post-Issue (a) (b) (a+b) 1 Sponsors and s 28,500,000-28,500, % 60% 2 Institutional - 9,500,000 9,500,000-20% 3 Public - 9,500,000 9,500,000-20% Total 28,500,000 1,900,000 47,500, % 100% (g) Objective of the issue including financing requirements and feasibility in respect of enhanced paid-up capital. Objective of the issue including financing requirements and feasibility in respect of enhanced paid-up capital incorporated are available in the Section- XXII under the head of Use of Proceeds. 141

152 CHAPTER XXII: USE OF PROCEEDS The use of the issue proceeds shall be disclosed in the prospectus in details: Provided that not more than 1/3rd of the issue proceeds shall be used for repayment of loans or as working capital. The following disclosures shall be made in this regard: (a) Use of net proceeds of the offer indicating the amount to be used for each purpose with head-wise break-up; Sl. Area of utilization of IPO Proceeds Amount in Tk. Remarks 1 Investment in FDR & Treasury Bond 178,000, To meet up IPO expenses 12,000, Please see Note-1 Total 190,000, Note-1: Details break up of Investments infdr & Treasury Bond Sl Area of Investment % of Investment Amount Rate of Interest 1 FDR 85% 151,300,000 Subject to market rate 2 Treasury Bond 15% 26,700,000 Subject to market rate Total 100% 178,000,000 b) Utilization of the total amount of paid-up capital and share premium, if any, including the sponsors contribution and capitalraised of the issuer at the time of submission of prospectus, in details with indication of use of such funds in the financial statements; The sponsor of the company has given paid up capital through cash consideration which was used in ordinary course of business. Apart from that, th company has not received any fund through private placement from any sponsor or any other person. The utilization of the paid up capital of the company are as follows: Sl. Particulars Description Amount in Taka Indication In the Financial Statement 1 Transport Motor Vehicles (15* Tk lac each) 2 Long term Investment Investment In FDR and Treasury Bond 3 Furniture and Equipment Purchase Office Furniture and Decoration Statement Of Financial Position 39,786,000 as at 30 Sep, 2018 Statement Of Financial Position 3,200,000 as at 30 Sep, 2018 Statement Of Financial Position 5,295,520 as at 30 Sep, Software and Hardware Company s Apps, Software upgradation, Purchase new computers, Servers and electronic hardware for network up graduation 23,270,590 Statement Of Financial Position as at 30 Sept, 2018 Total 71,552,

153 Sd/- Mir RAshed bin Aman Add.MD &Chief Financial Officer Sd/- Ajit Chandra Aich Managing Sd/- Noor-E-Hafza Chairman (c) If one of the objects is an investment in a joint venture, a subsidiary, an associate or any acquisition, details of the form of investment, nature of benefit expected to accrue to the issuer as a result of the investment, brief description of business and financials of such venture; The Company has no objective to invest in any joint venture, subsidiary, associate or for any acquisition purpose. (d) If IPO proceeds are not sufficient to complete the project, then source of additional fund must be mentioned. In this connection, copies of contract to meet the additional funds are required to be submitted to the Commission. The means and source of financing, including details of bridge loan or other financial arrangement, which may be repaid from the proceeds of the issue along with utilization of such funds; The company has not received any additional fund to fund requird to comple the project. (e) A schedule mentioning the stages of implementation and utilization of funds received through public offer in a tabular form, progress made so far, giving details of land acquisition, civil works, installation of plant and machinery, the approximate date of completion of the project and the projected date of full commercial operation etc. The schedule shall be signed by the Chief Executive Officer or Managing, Chief Financial Officer and Chairman on behalf of Board of s of the issuer; Implementation schedule of IPO proceed Sl. Area of utilization of IPO proceeds Amount in Tk. Approximate date of utilization of fund 1 Investment in FDR & Treasury Bond 178,000, Within 01 month after listing 2 To meet up IPO expenses 12,000, Time to time as and when required Sd/- Mir RAshed bin Aman Add.MD &Chief Financial Officer Sd/- Ajit Chandra Aich Managing Sd/- Noor-E-Hafza Chairman (f) If there are contracts covering any of the activities of the issuer for which the proceeds of sale of securities are to be used, such as contracts for the purchase of land or contracts for the construction of buildings, the issuer shall disclose the terms of such contracts, and copies of the contracts shall be enclosed as annexure to the Prospectus; There is no contract covering any of the activities of the issuer company for which the proceeds of sale of securities from IPO is to be used. (g) If one of the objects of the issue is utilization of the issue proceeds for working capital, basis of estimation of working capital requirement along with the relevant assumptions, reasons for raising additional working capital substantiating the same with relevant facts and figures and also the reasons for financing short with long term investments and an item wise break-up of last three years working capital and next two years projection; There is no object of the issue for utilization of the issue proceeds as working capital. (h) Where the issuer proposes to undertake one or more activities like diversification, modernization, expansion, etc., the total project cost activity-wise or project - wise, as the case may be; 143

154 Prospectus of SLICL There are no such activities proposes to undertake by the issuer. (i) Where the issuer is implementing the project in a phased manner, the cost of each phase, including the phases, if any, which have already been implemented; The implementation of the project will be implemented in a single phase. (j) The details of all existing or anticipated material transactions in relation to utilization of the issue proceeds or project cost with sponsors, directors, key management personnel, associates and group companies; There is no such material transaction with sponsors, directors, key management personnel, associates and group companies in relation to utilization of the issue proceeds. (k) Summary of the project appraisal or feasibility report by the relevant professionals not connected with the issuer, issue manager and registrar to the issue with cost of the project and means of finance, weaknesses and threats, if any, as given in the appraisal or feasibility report; The company will utilize the IPO fund by investing in Government Securities and FDR. So, no project appraisal or feasibility report is required in this respect. 144

155 Prospectus of SLICL CHAPTER XXIII: LOCK- IN a) Ordinary shares of the issuer shall be subject to lock-in, from the date of issuance of prospectus or commercial operation, whichever comes later, in the following manner: (1) All shares held, at the time of according consent to the public offer, by sponsors, directors and shareholders holding ten percent (10%) or more shares, other than alternative investment funds, for 03(Three) years; (2) In case any existing sponsor or director of the issuer transfers any share to any person, other than existing shareholders, all shares held by those transferee shareholders, at the time of according consent to the public offer, for 03 (three) years; (3) Twenty five percent (25%) of the shares allotted to eligibleinvestors, for 06 (six) months and other twenty five percent (25%) of the shares allotted to them, for 09 (nine) months; (4) All shares held by alternative investment funds, at the time ofaccording consent to the public offer, for 01 (one) year; (5) All shares held, at the time of according consent to the publicoffer, by any person other than the persons mentioned in subrules(1), (2) and (3) above, for 01 (one) year. Provided that ordinary shares converted from any other type ofsecurities shall also be subject to lock-in as mentioned above. b) Statement of securities to be locked in for each shareholderalong with BO account number, lock-in period and number of securities to be locked in The following table indicates the Lock-In status of the shareholders of Sonali Life Insurance Company Limited: Number of % of SL. Position with the shares held Date of N a me in F u ll BO Account Number share No. Company and to be Acquisition held locked in 01. Mrs. Noor-E-Hafza Sponsor ,927, Mrs. Fauzia Qumrun Tania Sponsor ,386, Lock-in period from the date of issuance of Prospectus 3 years 3 years Rupali Insurance Company Ltd (Nominated by K. M. Farookh) Mr. Sheikh Mohammed Danial Mrs. Shafia Sobhan Chowdhury 06. Mrs. Kamrun Nahar 07. Mrs. Maya Rani Roy. Sponsor Sponsor Sponsor Sponsor Sponsor ,566, ,695, ,630, ,150, ,000, Mr. Sheikh Omar Faruque Sponsor ,000, Mr.Omar Khayum Sponsor ,000, years 3 years 3 years 3 years 3 years 3 years 3 years 145

156 Prospectus of SLICL 10. Mr. Ahmed Rajeeb Samdani. Sponsor ,530, years 11. Mrs. Hazera Hossain. Sponsor ,285, years 12. Mrs. Hoda Ali Selim Sponsor ,000, years Nargis Mahmuda Sponsor 13.. Shareholder ,000, years 14. Phowzia Khan Sponsor 3 years , Shareholder Total 28,500,

157 Prospectus of SLICL CHAPTER XXIV: MARKETS FOR THE SECURITIES BEING OFFERED The issuer shall apply to the following stock exchanges within 7 (seven) working days from the date of consent accorded by the Commission to issue Prospectus: SL No. Name of the Exchange Logo Address 1 Dhaka Stock Exchange Limited (DSE) 9/F, Motijheel C/A, Dhaka Chittagong Stock Exchange Limited (CSE) CSE Building, 1080 Sheikh Mujib Road, Chittagong. Declaration about Listing of Shares with the Stock Exchange(s) If none of the Stock Exchange(s), if for any reason, grant listing within 75 days from the closure of subscription, any allotment in terms of this Prospectus shall be void and the company shall refund the subscription money within fifteen days from the date of refusal for listing by the stock exchange, or from the date of expiry of the said 75 (seventy five) days, as the case may be. In case of non-refund of the subscription money within the aforesaid fifteen days, the company directors, in addition to the issuer company, shall be collectively and severally liable for refund of the subscription money, with interest at the rate of 2% (two percent) per month above the bank rate, to the subscribers concerned. The issue manager, in addition to the issuer company, shall ensure due compliance of the above mentioned conditions and shall submit compliance report thereon to the Commission within seven days of expiry of the aforesaid fifteen days time perio d allowed for refund of the subscription money. Trading and Settlement Trading and Settlement Regulation of the stock exchanges shall apply in respect of trading and settlement of the shares of the company. The issue shall be placed in N Category with DSE & CSE. 147

158 Prospectus of SLICL CHAPTER XXV: DESCRIPTION OF SECURITIES OUTSTANDING OR BEING OFFERED All types of securities outstanding or being offered with date or proposed date of such issue and to whom those are offered, number of securities and issue or offer pricealong with the following information: (a) Dividend, voting and preemption rights; The Share Capital of the company is divided into Ordinary Shares, carrying equal rights to vote and receive dividend in terms of the relevant provisions of the Companies Act 1994 and the Articles of Association of the company. All Shareholders shall have the usual voting rights in person or by proxy in connection with, among others, election of s & Auditors and other usual agenda of General Meeting Ordinary or Extra-ordinary. On a show of hand, every shareholder presents in person and every duly authorized representative of a shareholder present at a General Meeting shall have one vote and on a poll every shareholder present or by proxy shall have one vote for every share held by him or her. In case of any additional issue of shares for raising further capital the existing shareholders shall be entitled to Right Issue of shares in terms of the guidelines issued by the BSEC from time to time. (b) Conversion and liquidation rights; In terms of provisions of the Companies Act 1994, Articles of Association of the Company and other relevant rules in force, the shares of the Company are freely transferable. The Company shall not charge any fee for registering transfer of shares. No transfer shall be made to a firm, an infant or person of unsound mind. (c) Dividend policy; i. The profit of the Company, subject to any special right relating thereto created or authorized to be created by the Memorandum and subject to the provisions of the Articles of Association, shall be divisible among the members in proportion to the amount of capital paid-up on the shares held by them respectively. ii. No large dividend shall be declared than is recommended by the s, but the Company in its General Meeting may declare a smaller dividend. The declaration of s as to the amount of Net profit of the Company shall be conclusive. iii. No dividend shall be payable except out of the profits of the Company or any other undistributed profits. Dividend shall not carry interest as against the Company. iv. The s may from time to time pay the members such interim dividend as in their judgment the financial position of the Company may justify. v. A transfer of shares shall not pass the right to any dividend declared thereon before the registration of transfer. vi. No limitation in payment of dividend is stipulated in any debt instrument or otherwise. (d) Other rights of the securities holders; In terms of the provisions of the Companies Act 1994, Articles of Association of the Company and other relevant rules in force, the shares of the Company are transferable. The Company shall not charge any fee, other than Government duties for registering transfer of shares. No transfer shall be made to a minor or person of unsound mind. The s shall present the financial statements as required under the law & International Accounting Standard. Financial statements will be prepared in accordance with the International Accounting Standards consistently applied throughout the subsequent periods and present with the objective of providing maximum disclosu re as par law and International Accounting Standard to the shareholders regarding the financial and operational position of the company. The shareholders shall have the right to receive all periodical statement and reports, audited as well as un audited, published by the company from time to time. 148

159 Prospectus of SLICL CHAPTER XXVI: FINANCIAL STATEMENTS AUDITOR S REPORT AND FINANCIAL STATEMENT OF AHMAD & AKHTAR Chartered Accountants BCIC Bhaban (3rd floor) 30-31, Dilkusha C/A Dhaka 1000, Bangladesh Phone: , Fax : aacano120@gmail.com aacags125@gmail.com Branch Office: Dhaka and Chittagong INDEPENDENT AUDITOR S REPORT TO THE SHAREHOLDERS OF SONALI LIFE INSURANCE COMPANY LIMITED 149

160 Prospectus of SLICL Report on the Financial Statements We have audited the accompanying Financial Statements ofsonali Life Insurance Company Limited (the company), which comprise the Statement of Financial Position as at 30 June 2018 and the Life Revenue Accounts, Statement of Changes in Equity and Statement of Cash Flows for the period from 01 January 2018 to 30 June 2018 then ended and a summary of significant accounting policies and other explanatory information thereto. Management s Responsibility for the Financial Statements Management is responsible for the preparation and fair presentation of these financial statements in accordance with Bangladesh Accounting Standards (BASs) and Bangladesh Financial Reporting Standards (BFRSs) and for such internal control as management determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. Auditor s Responsibility Our responsibility is to express an opinion on these financial statements of the company based on our audit. We conducted our audit in accordance with Bangladesh Standards on Auditing (BSA). Those standards require that we comply with relevant ethical requirements and plan and perform the audit to obtain reasonable assurance whether the financial statements of the company are free from material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on our judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, we consider internal control relevant to the entity s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expression an opinion on the effectiveness of the entity s internal control. An audit also includes evaluating the appropriateness of accounting principles used and the reasonableness of accounting estimates made by management, as well as evaluating the overall presentation of the financial statements of the company. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion. Opinion In our opinion, the financial statements give a true and fair view of the statement of financial position of Sonali Life Insurance Company Limited as at 30 June 2018 and its financial performance and its cash flows for the period from 01 January 2018 to 30 June 2018 then ended in accordance with Bangladesh Accounting Standards (BASs) and Bangladesh Financial Reporting Standards (BFRSs), the companies Act 1994, Insurance Act 2010, Insurance Rules 1958 and the Securities and Exchange Rules 1987 and other applicable laws & regulations. 150

161 Prospectus of SLICL Report on Other Legal and Regulatory Requirements In accordance with the Companies Act 1994 and the Insurance Act 2010, we also report the following: (i) (ii) we have obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purpose of our audit and made due verification thereof; in our opinion, proper books of account as required by law have been kept by the company so far as it appeared from our examination of those books; and (where applicable) proper returns adequate for the purposes of our audit have been received from branches not visited by us; (iii) the company s Statement of Financial Position as at 30 June 2018 and the Life Revenue Accounts, Statement of Changes in Equity and Statement of Cash Flows dealt with by the report are in agreement with the books of account and returns; (iv) the expenditure incurred was for the purpose of the Company s business; (v) as per Section 63(2) of the insurance Act 2010, we certify that to the best of our knowledge and belief and according to the information and explanations given to us, all expenses of management wherever incurred and whether incurred directly or indirectly, in respect of the life insurance business of SLI transacted in Bangladesh during the period under report have been duly debited to the related Revenue Accounts of the company; (vi) as per regulation-11 of part-1of the third schedule of Insurance Act 2010, we certify that to the best of our information and as shown by its books, SLI during the period under report has not paid any commission to any person in any form outside Bangladesh in respect of any of its business re-insured abroad; (vii) The information and explanation required by us have been received and found satisfactory; and (viii) The company has complied with relevant laws and regulations pertaining to reserves. (ix) Date : 6 August 2018 Place : Dhaka AHMAD & AKHTAR Chartered Accountants 151

162 Prospectus of SLICL Particulars Notes Amount in Taka 30 June Dec CAPITAL AND LIABILITIES SHAREHOLDERS' EQUITY Authorized Capital 100,000,000 Ordinary Shares of Tk.10 each ,000,000,000 1,000,000,000 ISSUED SUBSCRIBED AND PAID-UP SONALI LIFE INSURANCE COMPANY LIMITED STATEMENT OF FINANCIAL POSITION As at 30 June ,500,000 Ordinary Shares of Tk.10 each fully paid up in cash ,000, ,000,000 Statutory Deposit by the Shareholders ,000,000 15,000,000 BALANCE OF FUNDS AND ACCOUNTS 381,799, ,073,934 Life Insurance Fund ,799, ,073,934 LIABILITIES AND PROVISIONS 34,100, ,797,559 Estimated liabilities in respect of outstanding claims, whether due or intimated ,074,350 39,601,500 Amount due to other persons or bodies carrying on insurance business ,846 - Sundry Creditors ,322,022 80,960,512 Premium Deposits , ,547 TOTAL CAPITAL AND LIABILITIES 715,899, ,871,493 PROPERTY AND ASSETS LOANS On Insurers' Policies within their surrender value - INVESTMENT (AT COST) 141,187, ,741,949 Statutory Deposit with Bangladesh Bank ,000,000 15,000,000 Bangladesh Govt. Treasury Boand 11.A 33,800,000 33,800,000 Share Listed on Stock Exchanges ,066,291 - Other Investment ,321,227 67,941,949 Outstanding Premium ,972,699 19,325,713 Interest, Dividends and Rents Accruing but not due ,393,981 24,813,171 Advances, Deposits and Sundry Debtors ,462,867 26,683,258 CASH, BANK AND OTHER BALANCES 351,508, ,400,260 On Fixed Deposit with Banks & Financial Institutes ,760, ,260,000 On Short Term Deposit with Banks ,148,499 54,641,468 On Current Account with Banks , ,759 On Saving Account with Banks ,709 8,786,186 Cash in Hand 2,364, ,847 OTHER ACCOUNTS 147,374,088 94,907,142 Stamps, Printing & Stationary in Hand ,562 84,567 Fixed Assets (At Cost Less Depreciation) Schedule-1 105,829,516 73,819,320 Intangible Assets Schedule-2 41,466,010 21,003,255 TOTAL PROPERTY AND ASSETS 715,899, ,871,493 The annexed notes form an integtal part of these financial statements. Signed in terms of our separate report on even date annexed. Date : 6 August 2018 Place : Dhaka sd/- sd/- sd/- sd/- sd/- sd/- Chief Financial Officer Company Secretary Chief Executive Officer Vice Chairman Chairman sd/- AHMAD & AKHTAR Chartered Accountants 152

163 Prospectus of SLICL SONALI LIFE INSURANCE COMPANY LIMITED LIFE REVENUE ACCOUNT For the Period ended 30 June 2018 Particulars Notes 01 Jan 2018 to 30 June Jan 2017 to 30 June 2017 Amount in Taka 01 April 2018 to 30 June April 2017 to 30 June 2017 Income Balance of Fund at the beginning of the year 253,073,934 57,496, ,616,082 66,947,146 Premium Less Re-Insurance First Year Premium 228,198,992 89,938,245 97,708,958 51,755,811 Ordinary Life 225,602,029 87,000,778 96,383,422 50,377,640 Takaful 2,596,963 2,937,467 1,325,536 1,378,171 Renewal Premium 50,074,308 23,242,668 22,171,754 8,098,180 Ordinary Life 47,718,369 22,280,747 21,411,948 7,677,744 Takaful 2,355, , , ,436 Group Insurance Premium 2,707,627 2,884, , ,000 Life 2,707,627 2,884, , ,000 Health Gross Premium 280,980, ,064, ,419,512 60,298,991 Less: Re-insurance Premium 623, , ,276 Net Premium ,357, ,248, ,419,512 59,962,715 Interest, Dividend and Rents 23 14,096,839 8,501,420 6,393,109 5,280,656 Other Income , , , ,526 Total Income 547,971, ,451, ,572, ,309,043 First year premium, where the maximum premium paying period is: Single 132,028,746 34,739,607 45,931,508 23,683,220 Two Years Three Years Four Years Five Years Six Years Seven Years Eight Years Nine Years Ten-Eleven Years 49,882,437 19,710,606 32,999,803 10,520,768 Twelve -Fourteen Years 17,467,789 12,610,730 6,479,993 6,534,619 Fifteen- Nineteen Years 23,420,549 17,731,458 10,103,458 9,101,106 Twenty Years & Above 5,399,471 5,145,844 2,194,196 1,916, ,198,992 89,938,245 97,708,958 51,755,811 Expediture Claims Under Policies (Including Provision For Claims due or intimated), less re-insurance: By Death 9,267,460 19,655,000 3,166,050 13,370,000 By Maturity By Disability 626,355 94, ,822 28,303 By Surrender 213, , , ,710 By Survival Benefit 19,947,112 1,583,600 6,537, ,000 By Survival Profit By Hospitalization - 25, ,054,729 21,743,694 10,212,333 14,209,

164 Prospectus of SLICL SONALI LIFE INSURANCE COMPANY LIMITED LIFE REVENUE ACCOUNT For the Period ended 30 June 2018 Particulars Notes 01 Jan 2018 to 30 June Jan 2017 to 30 June April 2018 to 30 June April 2017 to 30 June 2017 Expenses of Management Commissions: 46,915,570 18,797,446 21,270,188 11,113,193 (a) Commissions to Insurance Agents (Less that on Re-insurance) 29,686,853 10,902,519 11,662,862 6,112,257 (b) Allowances and Commissions (other than commission including in sub-item (a) preceding) 17,228,717 7,894,927 9,607,326 5,000,936 Salaries etc.(other than to Agents and those Contained in the Allowances and 78,845,006 57,502,378 29,945,719 27,587,935 Commissions) Salaries 25,397,773 20,656,514 12,341,661 10,009,862 Development Salaries & Allowances 22,665,580 6,787,861 3,157,632 3,245,219 Development Incentive 626, , , ,396 Travelling and Conveyance 82, ,907 22,127 75,412 s' Fees 156, ,000 96,000 60,000 Auditors' Fees 25,000-25,000 - Actuary Fees 1,150, ,000 - Medical Fees 354, , , ,496 Legal and Professional Fees - 50,000 - Insurance Policy Stamp 1,000, ,000 1,000, ,000 Advertisement & Promotional Exp - 66,003-14,003 Printing and Stationery 926,767 1,436, , ,790 Office Rent 11,182,852 12,675,204 4,572,214 6,092,889 Bank Charges 1,267, , , ,668 Financial Expenses 319,020 5,200,648-2,281,000 Brokerage Commission 18,036 5,983 18,036 3,618 Foreign Currency loss 7,771-7,771 - Repairs and Maintenance 92, ,610 76, ,700 Service Maintenance 1,007, , , ,641 Fuel, Oil Generator 34,125 32,500 20,475 19,500 Car Fuel, Maintenance & Repairs 56, , ,221 Papers, Periodicals and Books 5,310 31, ,900 Telephone, Fax and Internet 726, , , ,557 Electricity & Utility Expenses 2,180,899 1,813,541 1,405, ,640 Training and Recruitment Expenses 18,000 5,000-5,000 Entertainment 583,362 70, ,128 34,277 Insurance Premium (General) 228, ,800 46,738 - Postage and Courier 196, ,236 90,091 52,375 Business Development Expenses 331,768 1,200, , ,361 Prizes and Awards 72,000 65,000 32,000 32,000 Stamps & Forms 30,000 36,440 10,000 10,720 Fees, Subscriptions and Donation 330, , ,000 Meeting, Seminar & Symposium 398, , , ,690 Conference - 481, Refreshment & Recreation 7,371,919 1,000,000 3,200,317 1,000,

165 Prospectus of SLICL Particulars Notes 01 Jan 2018 to 30 June Jan 2017 to 30 June April 2018 to 30 June April 2017 to 30 June 2017 Other Expenses 10,356,646 8,171,409 5,344,803 4,162,038 Depreciation on Fixed Assets 7,308,711 4,744,914 3,921,778 2,439,325 Ammortization on computer software 3,047,935 3,426,495 1,423,025 1,722,713 Total Expenditure 166,171, ,214,927-66,773,043 57,072,179 Balance of the fund at the end of the year as shown in the Balance Sheet 381,799,398 75,236, ,799,398 75,236, ,971, ,451, ,572, ,309,043 The annexed notes form an integral part of these financial statements. sd/- sd/- sd/- sd/- sd/- sd/- Chief Financial Officer Company Secretary Chief Executive Officer Vice Chairman Chairman Signed in terms of our separate report on even date annexed. Date : 6 August 2018 Place : Dhaka sd/- AHMAD & AKHTAR Chartered Accountants 155

166 Prospectus of SLICL SONALI LIFE INSURANCE COMPANY LIMITED Statement of Changes in Equity For the Period ended 01 January 2018 to 30 June 2018 Particulars Share Capital Share Premium General Reserve Retained Earnings Other Reserve Amount in Taka Total Balance as on 01 January ,000, ,000,000 Addition during the period 105,000, ,000,000 Balance as on 30 June ,000, ,000,000 SONALI LIFE INSURANCE COMPANY LIMITED Statement of Changes in Equity For the Period ended 01 January 2017 to 30 June 2017 Particulars Share Capital Share Premium General Reserve Retained Earnings Other Reserve Amount in Taka Total Balance as on 01 January ,000, ,000,000 Addition during the year Balance as on 30 June ,000, ,000,000 sd/- sd/- sd/- Chief Financial Officer Company Secretary Chief Executive Officer sd/- sd/- sd/- Vice Chairman Chairman Date : 6 August 2018 Place : Dhaka 156

167 Prospectus of SLICL SONALI LIFE INSURANCE COMPANY LIMITED Statement of Cash Flows For the Period ended 30 June 2018 Particulars 01 Jan 2018 to 30 June 2018 Amount in Taka 01 Jan 2017 to 30 June 2017 A. CASH FLOWS FROM OPERATING ACTIVITIES Collection from Premium 279,700, ,570,136 Other income 443, ,892 Payment for Claims (46,581,879) (13,950,194) Payment for management expenses, commission, re-insurance and others (167,603,481) (111,864,717) Tax paid (571,343) (605,879) Interest, Dividends and Rents Received 8,516,029 6,489,998 Net Cash Flows from operating activities 73,903,591 (2,155,764) B. CASH FLOWS FROM INVESTING ACTIVITIES Acquisition of Fixed Assets (89,349,597) (9,232,700) Investment in Shares (982,198) - Other Investment (23,463,371) - Bangladesh Govt. Treasury Bond (BGTB) - (9,402,151) Net Cash Flows from investing activities (113,795,166) (18,634,851) C. CASH FLOWS FROM FINANCING ACTIVITIES Capital Introduced 105,000,000 - Net Cash Flows from financing activities 105,000,000 - D. Net increase/(decrease)in cash and cash Equivalents (A+B+C) 65,108,425 (20,790,615) E. Cash and Cash Equivalents at the beginning of the year 286,400, ,694,955 F. Cash and Cash Equivalents at the end of the year (D+E) 351,508, ,904,340 sd/- sd/- sd/- Chief Financial Officer Company Secretary Chief Executive Officer sd/- sd/- sd/- Vice Chairman Chairman Date : 6 August 2018 Place : Dhaka 157

168 Prospectus of SLICL SONALI LIFE INSURANCE COMPANY LIMITED Statement of Life Insurance Fund As at 30 June 2018 Particulars Amount in Taka 30 June Dec Assets Investment 141,187, ,741,949 Outstanding Premium 19,972,699 19,325,713 Interest, Dividends & Rents accrued but not due 30,393,981 24,813,171 Advances, Deposits & Sundry Debtors 25,462,867 25,683,258 Cash & Bank Balances 351,508, ,400,260 Stamps, Printing and Stationery in Hand 78,562 84,567 Fixed Assets (at cost less depreciation) 105,829,516 95,822,575 Intangible Assets 41,466,010 21,003, ,899, ,871,493 Less: Liabilities Amount due to Other Persons or Bodies - Carrying on insurance business 477,846 - Estimated liabilities in respect of - Outstanding Claim whether due or intimated 23,074,350 39,601,500 Sundry Creditors 10,322,022 80,960,512 Premium Deposits 226, ,547 34,100, ,797,559 Gross Fund 681,799, ,073,934 Less: Shareholders' Capital (Paid-up Capital) 285,000, ,000,000 Less: Statutory Deposit by the Shareholders 15,000,000 15,000,000 Life Insurance Fund as on 30 June ,799, ,073,

169 Prospectus of SLICL SONALI LIFE INSURANCE COMPANY LIMITED FORM-"AA" Classified Summary of the Assets in Bangladesh As at 30 June 2018 Sl. No. Name of Assets Book Value Taka Market Value Taka 1. Investment : a) Statutory Deposit with Bangladesh Bank 15,000,000 15,000,000 b) Bangladesh Govt. Treasury Boand (BGTB) 33,800,000 33,800,000 c) Share Listed on Stock Exchanges 16,066,291 38,962,000 d) Other Investment 76,321,227 76,321, Cash, Bank & Other Balances: a) On Fixed Deposit with Banks 223,760, ,760,000 b) Cash in Hand, STD & Current Account with Banks 127,748, ,748,685 c) Interest, Dividends & Rents accrued but not due 30,393,981 30,393,981 Remarks At cost At cost At cost At cost Realizable Value Realizable Value Realizable Value 3. Other Assets: a) Stamps, Printing & Stationery in Hand 78,562 78,562 At Cost b) Outstanding Premium 19,972,699 19,972,699 Realizable Value c) Advances, Deposits, Loans & Sundry Debtors 25,462,867 25,462,867 Realizable Value d) Fixed Assets (At cost less depreciation) 105,829, ,829,516 Depreciated Value e) Intangible Assets 41,466,010 41,466,010 Amortised Value Total: 715,899, ,795,

170 Prospectus of SLICL SONALI LIFE INSURANCE COMPANY LIMITED Notes, summary of significant accounting policies and other explanatory information For the Period ended 30 June LEGAL STATUS AND NATURE OF BUSINESS 1.01 Establishment and Status of the Company Sonali Life Insurance Company Limited was incorporated in Bangladesh on July 7, 2013 as a Public Company limited by shares under the Companies Act 1994 as adopted in Bangladesh vide certificate of incorporation No. C /13. The Company was also registered with the Insurance Development and Regulatory Authority (IDRA) in carrying on the business of life insurance on July 30, 2013 vides registration no. Life 02/2013 under Insurance Act Registered Office of the Company The registered office is situated at Rupali Bima Bhaban, 7, Rajuk Avenue, Motijheel, Dhaka Nature of Business The Company is engaged in the ordinary life insurance, pension and group insurance business since its incorporation. The Company offers a wide variety of insurance products which fulfils the requirements of present and prospective policy holders. The product portfolio of the Company feeds the following insurance lines: a. Ordinary Life Insurance, b. Group Insurance, c. Islami Jibon Bima (Takaful) BASIS OF PREPARATION AND FINANCIAL STATEMENTS 2.01 Basis of Presentation Financial Statements have been prepared on the historical cost basis except as disclosed in the accounting policies mentioned below. The financial statements have been prepared in adherence to Insurance Act 2010, Insurance Rule 1958, Companies Act 1994 and other applicable laws and regulations Responsibility for Preparation and Presentation of Financial Statements The management is responsible for the preparation and presentation of the financial statements under section 183 of the Companies Act 1994 and under section 27 of the Insurance Act

171 Prospectus of SLICL 2.03 Components of the Financial Statements The presentation of these financial statements is in accordance with the guidelines provided by BAS 1: Presentation of Financial Statements. The Financial Statement comprises: i) Statement of Financial Position as at 30 June 2018; ii) Life revenue account for the period ended 01 January 2018 to 30 June 2018; iii) Statement of changes in equity for the period ended 01 January 2018 to 30 June 2018; iv) Statement of cash flows for the period ended 01 January 2018 to 30 June 2018; v) Statement of life insurance fund as at 30 June2018; vi) Statement of classified summary of the assets (Form AA) as at 30 June 2018; vii) Notes to the financial statements comprising a summary of significant accounting policies and explanatory information Statement of Cash Flows Statement of cash flows is prepared in accordance with BAS-7 and cash flow from operating activities has been presented under direct method as outline in the Bangladesh Securities and Exchange Rules According BAS 7: Statement of Cash Flows, cash comprises cash in hand and cash equivalent in short term, highly liquid investments that are readily convertible to know amounts of cash and which are subject to an insignificant risk of changes of value. Considering the provisions of BAS 7 and BAS 1, cash in hand, fixed deposits and bank balances have been considered as cash and cash equivalents Statement of Changes In Equity The statement of changes in equity is prepared in accordance with BAS-1: presentation of Financial Statements Statement of Compliance The following under lying assumptions, measurement base, laws, rules, regulations and accounting pronouncement have been considered in preparing and presenting the financial statements: Going Concern; Accrual basis unless stated otherwise except for Statement of Cash Flows; Historical Cost Convention; The Insurance Act 2010; The Insurance Rules 1958; Provisions of the Companies Act 1994; Income Tax Ordinance 1984; Bangladesh Accounting Standards (BAS), and Bangladesh Financial Reporting Standard (BFRS); and Any other applicable laws, regulations, covenants and conventions etc Reporting Currency and Level of Precision The financial statements are prepared in Bangladeshi Taka, which is the Company s functional and presentation currency. 161

172 Prospectus of SLICL All financial information presented has been rounded off to the nearest taka. Figures in brackets indicate deduction Use of Critical Accounting Estimates and Judgments The preparation of financial statements in conformity with the accepted accounting principal and standards required that the Company s Management make judgments, estimates and assumptions that affect the reported amounts of income and expenses for the year and reported balance of assets and liabilities. The estimates and assumptions use in the company s financial statements are based upon management s evaluation of the relevant facts and circumstances of the date of financial statements. Actual results could differ from the estimates. Any revision to the accounting estimates is recognized prospectively. The areas where required assumptions and estimates are significant to the Company s financial statements or where Judgment was exercised in application of accounting policies are as follows: a) Useful life of depreciable assets. b) Impairment of assets. c) Reinsurance recoveries against outstanding claims. d) Provision for income taxes. However, assumptions and judgment made by management in the application of accounting policies that have significant effect on the financial statement are not expected to result in material adjustment to the carrying amount of assets and liabilities in the next year Reporting Period The financial period of the Company covers six months from 01 January 2018 to 30 June Date of Authorization of Financial Statements The Board of s has approved these financial statements on 6 th August Going Concern It was reviewed by the management, there was no significant going concern threat is available in the operation of the company SUMMARY OF SIGNIFICANT ACCOUNTING AND VALUATION POLICIES The principal accounting policies applied in the preparation of these financial statements are set out below. These policies have been consistently applied to all the years presented, unless otherwise stated. The specific Accounting Policies selected and applied by the company s management for significant transactions and events that have a material effect within the framework of Bangladesh Accounting Standard (BAS)-1 Presentation of Financial Statements in preparation and presentation of financial statements. Accounting and valuation methods are disclosed for reasons of clarity Revenue Recognitions 3.01(a) Individual life policies Individual life first year and single premium are recognized once the related policies are issued against receipt and realization of premium. 162

173 Prospectus of SLICL 3.01(b) Group Life Policies The premiums of Group policies are recorded after receipt of the premiums and in certain circumstances premiums falling due under the policies within the financial period are also recognized if these premiums are subsequently received Interest, Dividends and Rents Interest income is recognized on accrual basis unless otherwise stated. Accretion of discount and amortization of premium in respect of debt securities and other fixed income securities is amortized over the remaining period to maturity of such instrument on straight line basis. Interest income on bank deposits (FDRs) is recognized on accrual basis. Interest is accounted at gross value (before deduction of Income tax). Investments in Government securities- Bangladesh Government Treasury Bond (BGTB) and Fixed Deposit Receipt (FDR) are stated at face values. Interest incomes on investments are recognized on accrual basis for the number of days these are held taking into account effective yield on the instruments Provision A provision is recognized in the balance sheet if, as a result of past events, the company has present legal or constructive obligations that can be estimated reliably, and it is probable that an outflow of economic benefits will be required to settle the obligation Premium Deposit Premium deposit represents installment of premium received in advance from policyholders which will be adjusted with premium in subsequent year Re-Insurance The Company maintains facultative reinsurance arrangement with Scor Global Life Reinsurance Company of Singapore since its inception. The net retention of the company for Ordinary life is Tk. 3 lac per insured. Reinsurance premium is recorded as an expense evenly over the period of the reinsurance contact and off-set against the premium income of respective year Commission These are direct cost incurred in acquiring and maintaining insurance policies. Commission to insurance agents (less that on re-insurance) is classified under first year commission. Allowance and commission (other than commission to insurance agents) represent all forms of remuneration and incentives paid to certain development officers, field force staff and insurance agents Claims costs Claims costs consist of the policy benefit amount and claim settlement costs, where applicable. Death and rider claims are accounted for on receipt of intimation. 163

174 Prospectus of SLICL 3.08 Investments Investments are made in accordance with the provisions of the Insurance Rules-1958, Insurance Act and the circulars/notifications issued by the Controller of Insurance/IDRA in this context from time to time. i) Debt Securities Debt securities with fixed income (Bangladesh Govt. Treasury Bond), Private and Public Bonds and Debentures} are categorized by class and are accounted for held to maturity and have been valued at cost. The discount in respect of the debt securities which is the difference between the purchase price and the redemption amount is amortized and recognized in the Revenue Account on straight line basis over the remaining period to maturity of these securities. For fair presentation, premium, if any, premium on acquisition of those bonds and debentures are however charged to Revenue in the year of acquisition. ii) Shares listed in stock exchange Listed equity shares are categorized as an asset class Available -For-Sale and the asset is valued at the lower of their acquisition cost and the year end (last) closing prices on the Stock Exchanges. Adequate provision is however made for diminution if any, in the cost price of such shares against such quoted prices in the Stock Exchange. If the quoted prices of this class of share are higher than the cost prices, no credit is taken to revenue account Fixed Assets and Depreciation Fixed assets are reported at cost less accumulated depreciation and impairment, if any. Cost includes the purchase price and any cost directly attributable to bring the asset to its working condition for its intended use. Fixed assets of small value and assets for which useful lives cannot be estimated properly are fully charged to the Revenue in the year of their purchases. Subsequent expenditures incurred on existing fixed assets are expensed out except where such expenditure increases the future economic benefits from the existing assets. Any addition to the original fixed asset is depreciated over the useful life of the asset. Depreciation is charged on pro-rata basis from the date of purchase and up to the previous date of sale. Methods of providing depreciation are consistently applied in relation to the previous year (a) Tangible Assets The company has adopted the reducing balance method of depreciation on assets at rates in the following manner: Furniture & Fixture 10% Computer &Computer Equipment 25% Electric Equipment 15% Motor Vehicles 20% Office Decoration 10% Telephone Installation 10% Signboard 10% 164

175 Prospectus of SLICL 3.09 (b) Intangible Assets In accordance with BAS 38 Intangible Assets, the intangible assets are reported at acquisition value with deductions for impairment losses, if any. Intangible Asset comprises computer software which is stated at cost of acquisition, including any cost attributable for bringing the same to its working condition less accumulated amortization. Amortization is calculated on reducing balance method using 25% amortization rate Stamps, Printing and Stationary in hand Stocks of stamps, printing and stationary materials etc. in hand are valued at cost determined on average basis Taxation Current Tax The Company is engaged in life insurance business and its taxation is based on taxable income determined under the fourth schedule of the income Tax ordinance, Deferred Tax As the profits and gains of the insurance business from all sources are to be computed in accordance with the provision in the fourth schedule of the income Tax Ordinance and not under different heads of income, the Management feels it is not necessary to make estimate of deferred tax assets/liabilities at this stage as per the provision of BAS Risk Minimization Strategies 3.12(a) Individual Life Business Insurance underwriting risk is the risk that the company will suffer losses due to economic situation or the rate of occurrence of an incident contrary to forecast made at the time of setting up of the premium rate. The underwriting risk arises from death and sometimes due to permanent disability and critical illness. The company may get exposed to poor risk due to unexpected experience in terms of claim severity or frequency. This can be a result of anti-selection, fraudulent claims or poor persistency. The company may also face the risk of poor investment return, inflation of business expenses and liquidity issues on monies invested in the fund. The Company faces the risk of under pricing particularly due to nature of long contract. In addition to this, due to poor Persistency, the company would be unable to recover expenses of policy acquisition. The company manages these risks through its underwriting, reinsurance, claims handling policy and other related control mechanisms. The company has a well-defined policy and avoids selling policies to high risk individuals. Underwriting procedures have been enhanced and rules have been structured to enable the Company to strike a balance between mitigating risk, ensuring control providing better service. This puts a check on anti-selection. The Company Seeks to reduce its risk exposure by reinsuring certain levels of risks with renowned Global Life Reinsurance Company of Singapore. The company provides quality service to the policy holders and checks to minimize miss-selling and avoid poor persistency. A regular monitoring of laps rate is conducted. The Company has procedures in place to ensure avoidance of payment of fraudulent claim. The Claim Committee reviews high sum assured and early claims for verification and detailed investigation of all doubtful and early claims are conducted. The company maintains adequate liquidity to cater for potentially sudden and high cash requirement. 165

176 Prospectus of SLICL 3.12(b) Group Life The major risk underwritten by the company is death which depends on mortality. Other risks underwritten include disability and major disease. Risk increase as a result of catastrophic events, business procurement without following underwriting guidelines, business procurement at low premium rate due to tough market competition and fraudulent claims. Non-receipt of premium in due time is an additional factor. The Company manages these risks through proper underwriting, effective claims handing and other claim control mechanism. The Company also avoids underwriting group business with employees exposed to hazardous profession. Pricing is done in line with actuarial guideline, experience and the mortality exposure the concerned group faces. Moreover, premium rates of existing group are also reviewed from time to time on the basis of claim experience. Besides, the company avoids payment of fraudulent claims through claim investigation. Strict monitoring is in place to keep the outstanding balances of premium at a minimum. 3.12(c) 3.12(d) Liquidity Risk Liquidity risk is the risk that the Company will be unable to meet its funding requirements. To guard against the risk the Company has diversified funding sources and assets are managed with liquidity in mind, maintaining healthy balance of cash and cash equivalent and readily market securities. Interest Rate Risk The Company invests in securities and has deposits that are subject to interest rate risk. Interest rate risk to the Company is the risk of changes in market. Interest rate reducing the overall returns on its interest basis securities. The Company limits interest risk by monitoring changes in interest rates in the money market and by diversifying into various institutions (issuers of securities). 3.12(e) Market Risk (investment pattern) Market risk is the risk that the value of a financial instrument will fluctuate as a result of changes in market prices, whether these changes are caused by factors specific to the individual security or its issuer or factors affecting all securities traded in the market. The company is exposed to market risk with respect to its investment. The company continues to adopt a prudent policy in respect of investments. The investments are mainly in Govt. securities. Fixed Deposits Receipts (FDR s) with various commercial banks and financial institutions having acceptable performance parameters and ratings and equity shares in listed companies having good and positive fundamental and technical attributes. The Company also limits market risk maintaining a diversified profile and by continuous monitoring of developments in Govt. securities (bonds) equity and term finance certificates markets. In addition, the Company actively monitors the key factors that affect the underlying value of these securities. 166

177 Prospectus of SLICL 3.12(f) 3.12(g) 3.12(h) Reinsurance Risk The company seeks to reduce its risk exposure by reinsuring certain levels of risk with re-insurer. Re-insurer ceded does not relieve the company from its obligation to policyholder and as a result, the company also remains liable for the portion of outstanding claims reinsured to the extent that re-insurer does not obligations ultimately under the reinsurance agreements. In order to minimize the risk, the company has obtained reinsurance cover from a renowned reinsurer, Scor Global Life Reinsurance Company Limited of Singapore with proven sound financial health. Foreign Currency Risk As at the Balance Sheet date there are no financial instruments denominated in foreign currency. Therefore, the company is not exposed to risk from any foreign currency exchange rate risk fluctuation. Credit Risk Credit Risk is the risk, which arises with the possibility that one party to a financial instrument will fail to discharge its obligation and cause the other party to incur a financial loss. Major credit risk is in bank. The management monitors exposure to credit risk through regular review of credit exposure and assessing credit worthiness of counter parties Employee Benefits Short-term employee benefits are employee benefits, which fall due wholly within 12 months after the end of the period in which the employees render the related service including salaries, bonuses and other allowances. With effect from the financial year ended 31 December 2016 the company has adopted BAS 26 - Employee Benefits of which payment of long term benefits to employees after retirement and / or after the completion of contract service is recognized on an accrual basis in the Balance Sheet ; such amount is recognized as a liability shown under sundry creditors GENERAL i) The previous year s figures have been regrouped, rearranged and reclassified wherever necessary. Amount and other disclosures of where preceding year are included as an integral part of the current financial statements ; and ii) Amounts presented have been rounded to the nearest taka. iii) Office rent has decreased comparatively from previous year due to the closure of some branches. The number of branches in previous year was 66 whereas in this year it is 55. iv) The amount of Car fuel, maintenance and repairs cost has decreased because the company attributed the maintenance cost of cars to its relevant users from this year. v) The insurance premium general represents the premium paid for assets like Cars and motor vehicle. The amount decreased from the previous year as the company allocated the amount of premium with its relevant assets at the time of acquisition at cost. 167

178 Prospectus of SLICL vi) vii) The company has a land of Tk. 1,000,000 derives from the contribution paid to BIA as advance payment for land; the company has not received any papers from BIA and registration is under process. Comparative information has been disclosed as required by BAS 34: Interim Financial Reporting in respect of the previous period for all numerical information in the current financial statements as below: Statement of Financial Position as of the end of the preceding financial period. Life revenue account for the comparable interim period of preceding financial period. Statement of Changes in Equity for the comparable interim period of preceding financial period. Statement Cash Flows for the comparable interim period of preceding financial period. 168

179 Prospectus of SLICL Amount in Taka 30 June Dec Share Capital 4.01 Authorized Capital : 100,000,000 ordinary shares of Taka 10 each. 1,000,000,000 1,000,000, Issued, subscribed, called-up and paid-up capital: 28,500,000 ordinary shares of Taka 10 each fully paid in cash. 285,000, ,000,000 The shareholding position of the company are as under: Name No of Shares Percentages % Amount in Taka Amount in Taka Mrs. Noor-E-Hafza 2,927, % 29,275,000 11,600,000 Mrs. Fauzia Quamrun Tania 4,386, % 43,865,000 24,500,000 Rupali Insurance Company Limited 4,566, % 45,660,000 30,000,000 Mrs. Shafia Sobhan Chowdhury 3,630, % 36,300,000 19,300,000 Mr. Sheikh Mohammed Danial 3,695, % 36,950,000 15,000,000 Mrs. Kamrun Nahar 1,150, % 11,500,000 10,000,000 Mrs. Maya Rani Roy 1,000, % 10,000,000 9,000,000 Mr. Sheikh Omar Faruque 1,000, % 10,000,000 10,000,000 Mr. Omar Khayam 1,000, % 10,000,000 10,000,000 Mr. Ahmed Rajeeb Samdani 1,530, % 15,300,000 10,300,000 Mrs. Hazera Hossain 1,285, % 12,850,000 10,300,000 Mrs. Hoda Ali Selim 1,000, % 10,000,000 6,700,000 Mrs. Nargis Mahmuda 1,000, % 10,000,000 10,000,000 Ms. Phowzia Khan 330, % 3,300,000 3,300,000 Total: 28,500, % 285,000, ,000, Statutory Deposit by the Shareholders This represents amount deposited by the shareholders as statutory deposit in accordance with Sec-23(1) of Insurance Act 2010 : Mrs. Noor-E-Hafza 966, ,667 Mrs. Fauzia Quamrun Tania 2,041,667 2,041,667 Rupali Insurance Company Limited 2,500,000 2,500,000 Mrs. Shafia Sobhan Chowdhury 1,608,333 1,608,333 Mr. Sheikh Mohammed Danial 1,250,000 1,250,000 Mrs. Kamrun Nahar 833, ,333 Mrs. Maya Rani Roy 750, ,000 Mr. Sheikh Omar Faruque 833, ,333 Mr. Omar Khayam 833, ,333 Mr. Ahmed Rajeeb Samdani 858, ,333 Mrs. Hazera Hossain 858, ,333 Mrs. Hoda Ali Selim 558, ,333 Mrs. Nargis Mahmuda 833, ,333 Ms. Phowzia Khan 275, ,000 15,000,000 15,000, Life Insurance Fund This consists of the accumulated balance of revenue surplus up to June 30, Opening balance 253,073,934 57,496,791 Add: Increase / (decrease) in Life Revenue A/C during the period 128,725, ,577,143 Closing balance 381,799, ,073,934 The detailed break up is shown in statement of life insurance fund Estimated liabilities in respect of outstanding claims whether due or intimated This balance made up as follows: Opening balance 39,601,500 46,266,000 Add: Claim intimated during the period 9,197,850 26,460,500 48,799,350 72,726,500 Less: Paid during the period 25,725,000 33,125,000 Closing balance 23,074,350 39,601,

180 Prospectus of SLICL Amount in Taka 30 June Dec Amount due to other persons or bodies carrying on insurance business The balance is made up as follows: Opening Balance - 22,876 Add: Addition during the period 623,655 1,804, ,655 1,826,883 Less: Adjustment during the period 145,809 1,826,883 Closing Balance 477,846 - The amount represents the balance due to Scor Global Life Reinsurance Company Limited on account of share of reinsurance premium Sundry Creditors The balance is made up as follows: Auditors Fee 25,000 25,000 Income Tax deduction ,018,694 2,244,981 VAT deduction 125, ,204 Utility Bills ,976 75,350 Agent's License Fee ,905,490 1,699,955 Dragon IT & Communication Ltd. - 4,842,885 Protishruti Limited - 350,000 Agent's Commission 584, ,573 Providend Fund 5,374,769 3,387,305 SBAC Bank Limited (A/C# ) - 40,898,259 Hyundai Motors - 26,520,000 Shah Mohammad Sagir & Co. Ltd. 966,793-10,322,022 80,960, Income Tax (IT) Deduction IT -Commission 945,239 2,060,781 Tax deduction at Source 73, ,200 1,018,694 2,244,981 This represents amount deducted at source as Advance Income Tax which will be deposited to Govt. Treasury Utility Bills Electricity 276,287 67,850 WASA 44,689 7, ,976 75,350 This amount charged in Revenue Account as recurring expenses but not paid during the year Agent's License Fee This represents amounts received from various agent's for doing licenses on behalf of them as fees which is under process and will be deposited gradually to the IDRA Premium Deposit First Year Premium 108, ,889 Renewal Premium 117, , , ,547 This represents payment by policyholders as excess amount of their premium. This will be adjusted with their premium in subsequent year Investment in Statutory Deposit with Bangladesh Bank In compliance with section 23(1) of Insurance Act 2010, Tk. 15,000, (One Crore Fifty Lac) only has been invested in Bangladesh Govt. Treasury Bond through Janata Bank Ltd. bearing ISIN No. BD and deposited into Bangladesh Bank as Statutory Deposit in favor of the Company with 12.48% per annum to be matured on 27/03/2033. Interest earned and received during the year has been duly accounted for. 170

181 Prospectus of SLICL Amount in Taka 11.A Bangladesh Govt. Treasury Bond 30 June Dec No 20 year 8.28% government treasury bond BD ,000,000 10,000, year7.59% government treasury bond BD ,800,000 13,800, year 7.79% government treasury bond BD ,000,000 5,000, year 8.70% government treasury bond BD ,000,000 5,000,000 33,800,000 33,800,000 This represents investment made in government treasury bond as per provision of section 41 of the Insurance Act Investment in Shares Sl. No. Name of the Company Number of Share *Average cost per unit(tk.) Total Book Value at cost (Tk.) 1 Dragon Sweater & Spining Ltd. 2,020, ,464,091 2 BBS Cable 5, ,200 3 IFIC Bank 10, ,000 4 National Bank Ltd. 10, Total : 100,000 16,066,291 ** * Total book value at cost has been divided by the number of unit. ** Average Market Value per unit as on Total Market Value (Tk.) 38,359, , , ,000 The total market value (as per price index of DSE) of the above shares as on 30 June 2018 stood at Tk. 38,962,000 against the book value of Tk. 16,066, Other Investment DPS Note ,821,227 50,357,856 Placement Share ,500,000 17,584,093 76,321,227 67,941, DPS First Security Islami Bank Ltd. DPS # ,757,762 1,485,242 First Security Islami Bank Ltd. DPS # ,757,604 1,485,241 First Security Islami Bank Ltd. DPS # ,757,461 1,484,942 First Security Islami Bank Ltd. DPS # ,792,791 1,503,052 First Security Islami Bank Ltd. DPS # ,733,554 1,443,815 First Security Islami Bank Ltd. DPS # ,675,170 1,385,430 First Security Islami Bank Ltd. DPS # ,616,742 1,327,002 First Security Islami Bank Ltd. DPS # ,616,742 1,327,002 First Security Islami Bank Ltd. DPS # ,616,162 1,326,423 First Security Islami Bank Ltd. DPS # ,616,162 1,326,423 First Security Islami Bank Ltd. DPS # ,616,090 1,326,351 First Security Islami Bank Ltd. DPS # ,616,453 1,326,714 First Security Islami Bank Ltd. DPS # ,649,596 1,339,516 First Security Islami Bank Ltd. DPS # ,649,595 1,339,515 First Security Islami Bank Ltd. DPS # ,649,596 1,339,516 First Security Islami Bank Ltd. DPS # ,649,596 1,339,516 First Security Islami Bank Ltd. DPS # ,649,596 1,339,516 First Security Islami Bank Ltd. DPS # ,649,266 1,339,186 First Security Islami Bank Ltd. DPS # ,649,267 1,339,187 First Security Islami Bank Ltd. DPS # ,649,267 1,339,187 First Security Islami Bank Ltd. DPS # ,327,626 1,008,709 First Security Islami Bank Ltd. DPS # ,327,968 1,009,051 First Security Islami Bank Ltd. DPS # ,327,968 1,009,051 First Security Islami Bank Ltd. DPS # ,327,968 1,009,051 First Security Islami Bank Ltd. DPS # ,327,968 1,009,051 First Security Islami Bank Ltd. DPS # ,327,968 1,009,051 First Security Islami Bank Ltd. DPS # ,589,317 1,279,238 First Security Islami Bank Ltd. DPS # ,589,317 1,279, ,962,

182 Prospectus of SLICL Amount in Taka 30 June Dec Social Islami Bank Limited-DPS # , ,734 Social Islami Bank Limited-DPS # , ,734 Social Islami Bank Limited-DPS # , ,734 Social Islami Bank Limited-DPS # , ,734 Social Islami Bank Limited-DPS # , ,726 Social Islami Bank Limited-DPS # , ,726 Social Islami Bank Limited-DPS # ,052, ,681 Social Islami Bank Limited-DPS # ,052, ,681 Social Islami Bank Limited-DPS # ,005, ,815 Social Islami Bank Limited-DPS # ,052, ,681 Social Islami Bank Limited-DPS # , ,436 Social Islami Bank Limited-DPS # , ,420 Social Islami Bank Limited-DPS # , ,420 Social Islami Bank Limited-DPS # , ,420 Social Islami Bank Limited-DPS # , ,403 Social Islami Bank Limited-DPS # , ,403 Social Islami Bank Limited-DPS # , ,403 Social Islami Bank Limited-DPS # , ,403 Social Islami Bank Limited-DPS # , ,403 Social Islami Bank Limited-DPS # , ,603 Social Islami Bank Limited-DPS # , ,603 Social Islami Bank Limited-DPS # , ,603 Social Islami Bank Limited-DPS # , ,013 Social Islami Bank Limited-DPS # , ,013 Social Islami Bank Limited-DPS # , ,006 Social Islami Bank Limited-DPS # , ,006 Social Islami Bank Limited-DPS # , ,921 Social Islami Bank Limited-DPS # , ,921 Social Islami Bank Limited-DPS # , ,921 Social Islami Bank Limited-DPS # , ,483 Social Islami Bank Limited-DPS # , ,483 Social Islami Bank Limited-DPS # , ,123 Social Islami Bank Limited-DPS # , ,092 Social Islami Bank Limited-DPS # , ,347 Social Islami Bank Limited-DPS # , ,132 Social Islami Bank Limited-DPS # , ,132 Social Islami Bank Limited-DPS # , ,132 Social Islami Bank Limited-DPS # ,647 75,647 Social Islami Bank Limited-DPS # ,687 84,687 Social Islami Bank Limited-DPS # ,687 84,687 Social Islami Bank Limited-DPS # ,687 84,687 Social Islami Bank Limited-DPS # ,828 96,828 Social Islami Bank Limited-DPS # ,828 96,828 Social Islami Bank Limited-DPS # ,461 50,461 Social Islami Babk Limited-DPS# ,461 50,461 Social Islami Babk Limited-DPS# ,461 50,461 Social Islami Babk Limited-DPS# ,461 50,461 Social Islami Babk Limited-DPS# ,515 56,515 Social Islami Babk Limited-DPS# ,515 56,515 Social Islami Babk Limited-DPS# ,515 56,515 Social Islami Babk Limited-DPS# ,515 56,515 Social Islami Babk Limited-DPS# ,589 64,589 Social Islami Babk Limited-DPS# ,589 64,589 Social Islami Babk Limited-DPS# ,589 64,589 Social Islami Babk Limited-DPS# ,589 64,589 Social Islami Babk Limited-DPS# ,682 74,682 Social Islami Babk Limited-DPS# ,682 74,682 Social Islami Babk Limited-DPS# ,682 74,682 Social Islami Babk Limited-DPS# ,682 74,

183 Prospectus of SLICL Amount in Taka 30 June Dec Social Islami Babk Limited-DPS# ,773 84,773 Social Islami Babk Limited-DPS# ,773 84,773 Social Islami Babk Limited-DPS# ,773 84,773 Social Islami Babk Limited-DPS# ,773 84,773 Social Islami Babk Limited-DPS# ,285 50,285 Social Islami Babk Limited-DPS# ,285 50,285 Social Islami Babk Limited-DPS# ,142 25,142 Social Islami Babk Limited-DPS# ,142 25,142 Social Islami Babk Limited-DPS# ,142 25,142 Social Islami Babk Limited-DPS# ,142 25,142 Social Islami Babk Limited-DPS# ,142 25,142 Social Islami Babk Limited-DPS# , ,003 Social Islami Babk Limited-DPS# , ,420 73,821,227 50,357, Placement Share Dragon Sweater & Spinning Limited - 15,084,093 Intraco Refueling Stations Limited 2,500,000 2,500,000 2,500,000 17,584, Outstanding Premium 19,972,699 19,325,713 19,972,699 19,325,713 The amount represents premium receivable on Ordinary Life (OR) as on 30 June 2018 for which grace periods did not expire as on the above date. Outstanding Premium less than 30 days 6,089,626 8,572,810 Outstanding Premium more than 30 days 13,883,073 10,752,903 19,972,699 19,325, Interest, Dividends and Rents Accruing but not Due This represents balance made up as follows: Interest Accrued on Fixed deposit with Banks 27,062,366 23,638,558 Interest on Bangladesh Government Treasury Bond BGTB (Statutory) 491, ,422 Interest on Bangladesh Government Treasury Bond (BGTB) 259, ,191 Interest Accrued on DPS 2,581,112-30,393,981 24,813, Advances, Deposits, and Sundry Debtors This represents balance made up as follows: Note Advance Income Tax at source ,107,756 9,536,413 Advance against Office Rent ,768,738 3,487,123 Advance against Salary ,289,998 3,329,212 Advance against Expenses ,948,916 5,180,348 Advance against Traveling 1,880,835 1,995,835 Green Delta Securities Ltd. 34,659 34,709 Shah Mohammad Sagir & Co. Ltd. - 33,391 Advance against Land 1,000,000 1,000,000 Advance Against Motor Cycle ,115,965 2,086,227 Advance Against IPO Expenses 1,316,000 25,462,867 26,683,258 Discloser as per Schedule- XI, Part -I, of the Companies Act, Advance income tax at source Advance income tax at source less than 6 months 568,112 1,275,684 Advance income tax at source more than 6 months 9,539,644 8,260,729 10,107,756 9,536,

184 Prospectus of SLICL Amount in Taka 30 June Dec Advance Against Office Rent Advance against office rent less than 6 months 704,800 1,342,620 Advance against office rent more than 6 months 3,063,938 2,144,503 3,768,738 3,487, Advance Against salary Advance against salary less than 6 months 100, ,984 Advance against salary more than 6 months 3,189,998 2,801,228 3,289,998 3,329, Advance Against expenses Advance against expenses less than 6 months 818, ,680 Advance against expenses more than 6 months 1,130,198 5,034,668 1,948,916 5,180, Advance Against motor cycle Advance against motor cycle less than 6 months 91, ,750 Advance against motor cycle more than 6 months 2,024,248 1,740,477 2,115,965 2,086, Fixed Deposit with Banks & Financial Institutes (FDR) This represents balance made up as follows: Bank Asia Ltd. 500, ,000 EXIM Bank Ltd 2,600,000 2,600,000 Farmers Bank Ltd.(FBL) 51,000,000 51,000,000 First Security Islami Bank Ltd. 13,300,000 13,300,000 NRB Global Bank Ltd. 29,100,000 30,100,000 Shahjalal Islami Bank Ltd. 7,000,000 7,000,000 South Bangla Agriculture & Commerce Bank Ltd. 109,000, ,500,000 Lanka Bangla Finance Ltd. 9,460,000 13,260,000 ICB Islamic Bank 1,800, ,760, ,260, Short Term Deposit with Banks This is consisting of of STD Account maintained with 25 banks throughout the country as follows: Agrani Bank Ltd., Malibagh Br. # Islami Bank Bangladesh Ltd., Mouchak Br. # , ,419 BRAC Bank Ltd., Rampura Br. # , ,132 Dutch Bangla Bank Limited, Manda Br. # ,496,513 18,913,236 EBL, Magbazar Br. # ,470 24,703 EXIM Bank Ltd. Malibagh# ,623 2,388,382 Farmers Bank Ltd.(FBL), Motijeel Br. # ,821,331 13,081 First security Islami Bank Ltd. Topkhana Br. # ,592 26,114 Jamuna Bank Ltd., Malibagh Br. # , ,568 Janata Bank Ltd., Janata Bhabon Corporate Br. # ,854 58,377 National Bank Limited Malibagh# , ,381 NCC Bank Ltd., Motijheel Br. # , ,637 NRB Global Bank Ltd. Motijheel Br. # , 18, Premier Bank Ltd., Nawabpur Road Br. # ,924 1,924 Shahjalal Islami Bank Ltd., Malibagh Choudhuri Para Br. # ,870 3,090,824 South Bangla A & C Bank Ltd., Principal Br. # , ,898 Standard Bank Ltd., Malibagh Br. # ,655 2,403,884 Southeast Bank Ltd.-Mouchk Br.# ,538 80,236 United Commercial Bank Ltd.,Dilkusha Br.# ,498,564 Bank Asia, Pultorn Br. # , ,795 Social Islami Bank Limited-SND # , ,279 Mutual Trust Bank Ltd ,408,716 4,156,245 Al-Arafah Islami Bank Limited ,098 1,024,400 ICB Islamic Bank South Bangla A & C Bank Ltd., Principal Br. # ,000, ,148,499 54,641,

185 Prospectus of SLICL Amount in Taka Current Account with Banks 30 June Dec This is consisting of Current Account maintained with 8 banks throughout the country as follows: Shahjalal Islami Bank Ltd. Malibagh Choudhuri Para Br.# ,532 20,562 NCC Bank Ltd. Malibagh Br. # ,375 EXIM Bank Ltd. Malibagh # , National Bank Limited Malibagh # , ,119 Dutch Bangla Bank Limited, Manda Br. # , ,096 Standard Bank Ltd., Malibagh Br. # ,028 2,363 Mutual Trust Bank Ltd.-CD # ,957 57,894 United Commercial Bank Ltd, Dilkusha Br.CD# , , , Saving Account with Banks This is consisting of Saving Account maintained with 4 banks throughout the country as follows: NRB Global Bank Ltd. Motijheel Br. # ,502 Shahjalal Islami Bank-SB ,361 1,456,852 Dutch Bangla Bank Limited-STD # ,981 7,260,832 Mutual Trust Bank Ltd.-SB# , ,709 8,786, Inventory ( Stamps, Printing & Stationary) This represents balance made up as follows: Opening balance 84,567 41,752 Add: Addition during the period 956,767 4,149,246 1,041,334 4,190,998 Less: Adjustment during the period 962,772 4,106,431 Closing balance 78,562 84, Premium Less Re-insurance (Net) This represent amount is made up as follows: Type of Premiums Gross Re-Insurance Net Premium Net Premium 30 Premium Premium 30 June 2018 June 2017 Ordinary Life (OR) 1st year 228,198, , ,944,266 89,458,214 Ordinary Life (OR) Renewal 50,074, ,928 49,705,380 22,906,392 Group Insurance Premium 2,707,627-2,707,627 2,884,082 Taka 280,980, , ,357, ,248, Interest, Dividend and Rents This represents amount made up as follows: Interest on STD 251, ,968 Interest on Savings account 3,632 27,033 Interest on FDR 8,904,056 6,249,959 Interest on BGTB 929,276 1,130,460 Interest on BGTB (Statutory) 1,427, ,000 Interest on DPS 2,581,112 - Profit / (Loss) on Sale of Share ,096,839 8,501, Other Income This balance is made-up as follows: Calendar Sale 12,370 19,260 Proposal form 17,961 25,894 Duplicate policy issue fee 570 Late fees 284, ,738 Crockeries sale 127,830 - Reserve for Unexpired Risk - 443, ,

186 Prospectus of SLICL Amount in Taka 30 June Dec Provision for Income Tax Income Tax liability is created on the basis of surplus of Actuarial Valuation Report as per 4th schedule 2b method of Income Tax Ordinance Actuarial Valuation Report has not been obtained on this financial statement. Therefore in absence of Actuarial Valuation Report provision for Income Tax is not calculated Capital Expenditure Commitment a) There was no capital expenditure contracted or incurred or unprovided for at 30 June 2018 b) There was no material capital expenditure authorized by the Board but not contracted for at 30 June Contingent Asset/ Liabilities There was no contingent assets or liabilities of the company as on 30 June Companies Act 1994,Schedul- XI part-ii [Note 3(P) (VI)5] i) Number of employees drawing salary above Tk. 3,000 per month ii) Number of employees drawing salary below Tk. 3,000 per month NIL NIL Payment in foreign currency The Company has paid Tk. 623,654 Equivalent to $ 7,513 as Re-Insurer during the period June Prevention of Money Laundering & Terrorist Financing : In line with the guidance notes provided by Bangladesh Bank and recommendation of the technical sub-committee (Life) of Bangladesh Insurance Association The company has a comprehensive anti money laundering & terrorist financing guidance. The Company has robust KYC & rule book and continuous monitoring by internal audit team Related party disclosures : The party is related to the company if the party cast significant influence over the subject matters and also hold the controlling power of the management affairs of the company and any transaction made during the year with the party related therewith is termed as related party transaction as per BAS-24 "Related Party Disclosure". During the year under audit related party transactions were made that which has influenced the company's business. The details of related party transactions during the year along with the relationship is illustrated below in accordance of BAS 24: Particulars Relationship Name of the Party with the Company Mrs. Noor-E-Hafza Chairman & Shareholder Mrs. Fauzia Quamrun Tania Vice Chairman & Shareholder Rupali Insurance Company Limited e & (Represented by K.M. Farookh) Shareholder Mrs. Shafia Sobhan Chowdhury e & Shareholder Mr. Sheikh Mohammed Danial e & Shareholder Mrs. Kamrun Nahar e & Shareholder Mrs. Maya Rani Roy e & Shareholder Mr. Sheikh Omar Faruque e & Shareholder Mr. Omar Khayam e & Shareholder Mr. Ahmed Rajeeb Samdani e & Shareholder Mrs. Hazera Hossain e & Shareholder Nature of transaction Board Meeting Fee Board Meeting Fee Board Meeting Fee Board Meeting Fee Board Meeting Fee Board Meeting Fee Board Meeting Fee Board Meeting Fee Board Meeting Fee Board Meeting Fee Board Meeting Fee Amount in Taka Amount in Taka 30 June June , , , , , , , , , , ,

187 Prospectus of SLICL Mrs. Hoda Ali Selim Imperial Sweater Industries Ltd. Perag Socks Industries Ltd. Dragon Sweater Bangladesh Ltd. Rupali Insurance Company Limited Golden Harvest Agro Industries Ltd. Golden Harvest Icecreame Ltd. Golden Harvest Foods Ltd Dragon IT & Communication Ltd. Intraco Refueling Stations Limited e & Shareholder Common Common Common Common Common Common Common Common Common Board Meeting Fee Group Insurance Group Insurance Group Insurance Group Insurance Group Insurance Group Insurance Group Insurance Payable Receivable Amount in Taka 30 June Dec , , ,500, Discloser of Managerial Remunaration : Total amount of remunaration paid to directors during the period as follows : Particulars Relationship Name of the Party with the Company Mrs. Noor-E-Hafza Chairman & Shareholder Mrs. Fauzia Quamrun Tania Vice Chairman & Shareholder Rupali Insurance Company Limited e & (Represented by K.M. Farookh) Shareholder Mrs. Shafia Sobhan Chowdhury e & Shareholder Mr. Sheikh Mohammed Danial e & Shareholder Mrs. Kamrun Nahar e & Shareholder Mrs. Maya Rani Roy e & Shareholder Mr. Sheikh Omar Faruque e & Shareholder Mr. Omar Khayam e & Shareholder Mr. Ahmed Rajeeb Samdani e & Shareholder Mrs. Hazera Hossain e & Shareholder Mrs. Hoda Ali Selim e & Shareholder Nature of transaction Board Meeting Fee Board Meeting Fee Board Meeting Fee Board Meeting Fee Board Meeting Fee Board Meeting Fee Board Meeting Fee Board Meeting Fee Board Meeting Fee Board Meeting Fee Board Meeting Fee Board Meeting Fee Amount in Taka Amount in Taka 30 June June ,000 10,000 13,000 10,000 13,000 10,000 13,000 10,000 13,000 10,000 13,000 10,000 13,000 10,000 13,000 10,000 13,000 10,000 13,000 10,000 13,000 10,000 13,000 10,

188 Prospectus of SLICL (b) Information as is required under section 186 of the company act 1994 relating to holding company; As there is no holding company, Information as is required under section 186 of the company Act 1994 is not applicable here. 178

189 Prospectus of SLICL (c) Selected Ratios as specified in Annexure D (c) Selected ratios as specified in Annexure-D Auditor s certificate regarding calculations of EPS and Other Ratios of Sonali Life Insurance Company Limited The following ratios have been computed from the Audited Financial Statements of Sonali Life Insurance Company Limited for the periods from 30 June 2018 and for the years ended 31 December 2017, 2016, 2015, 2014, 2013 SL Ratios Formula 30-Jun Dec Dec Dec Dec Dec-13 1 a Liquidity Ratio Current Ratio (Times) Calculation Result Calculation Result Calculation Result Calculation Result Calculation Result Calculation Result Current assets 202,340, ,962,402 61,445,799 36,425,414 18,058,972 8,704, Current Liabilities 34,100, ,797, ,463, ,735,922 51,734,957 18,421,366 b 2 a Quick Ratio (Times) Current asset- Inventories- 178,150, ,433,461 44,077,179 22,720,502 10,713,303 5,646,639 Advance, deposit & Current prepayments liabilities 33,754, ,797, ,463, ,735,922 51,734,957 18,421,366 Operating Efficiency Ratios Account Receivable Gross Premium N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A turnover (Times) Average Account receivales N/A N/A N/A N/A N/A N/A b c 3 a b Inventory turnover ratio (Times) Asset Turnover Ratio (Times) Profotability Ratios Gross Margin ratio(%) Operating profit ratio (%) COGS N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A Average Inventory N/A N/A N/A N/A N/A N/A Gross premium 280,980, ,524, ,473, ,379, ,166,865 17,547, Average total assets 641,727, ,915, ,484, ,832, ,472, ,287,275 N/A 0.08 Gross Margin N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A Gross Premium N/A N/A N/A N/A N/A N/A N/A Operating Income N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A Gross Premium N/A N/A N/A N/A N/A N/A N/A NPAT N/A N/A N/A N/A N/A N/A c Net profit Ratio (%) N/A N/A N/A N/A N/A N/A Net premium N/A N/A N/A N/A N/A N/A d Return on asset ratio (%) Net profit after tax N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A Average total assets N/A N/A N/A N/A N/A N/A 179

190 Prospectus of SLICL e f 4 a Return on equity ratio (%) Basic earnings per share Solvency Ratio Debt to total assets ratio Net profit after tax N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A Average shareholders Equity N/A N/A N/A N/A N/A N/A Net profit after tax N/A N/A N/A N/A N/A N/A Weighted average number of N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A shares Total debt N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A Total Asset N/A N/A N/A N/A N/A N/A Total debt N/A N/A N/A N/A N/A N/A b Debt to equity ratio N/A N/A N/A N/A N/A N/A Total equity N/A N/A N/A N/A N/A N/A c d 5 a Times Interest earned ratio Debt Service coverage ratio Cash Flow Ratio Net Operating cash flow per share Operating profit N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A Financial expense N/A N/A N/A N/A N/A N/A Net Operating profit N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A Total debt service N/A N/A N/A N/A N/A N/A Net Operating cash flow N/A N/A N/A N/A N/A N/A Number of ordinary share N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A outstanding NOCFPS N/A N/A N/A N/A N/A N/A b NOCFPS to EPS N/A N/A N/A N/A N/A N/A EPS N/A N/A N/A N/A N/A N/A sd/- Date : 6 August 2018 AHMAD & AKHTAR Place : Dhaka Chartered Accountants 180

191 Prospectus of SLICL Auditor's Report in pursuance to Section 135(1) and paragraph 24(1) (3) and 25 of part-ii of the Schedule III of the Companies Act, 1994 As required under section 135(1), Para 24(1), Part II of the Third Schedule of Companies Act 1994, we appended below the following financial information of Sonali Life Insurance Company Limited (SLICL) for the period ended 30 June 2018 audited by us and the year ended 31 Dec. 2017, 2016, 2015, 2014 and 2013 audited by Ahmad & Akhtar Chartered Accountants. 1. Sonali Life Insurance Company Limited was incorporated on 07 July 2013 and started it's commercial operation from 01 August The operating results of the company over the last five years is as follows: A. Statement Of Finanacial Position Particulars 30-Jun Dec Dec Dec Dec Dec-13 Capital and Liabilities Shareholders' Equity Authorised Capital: 100,000,000 ordinary shares of Tk. 10 each 1,000,000,000 1,000,000,000 1,000,000,000 1,000,000,000 1,000,000,000 1,000,000,000 Issued Subscribed And Paid-Up 28,500,000 ordinary shares of Tk. 10 each fully paid up in cash 285,000, ,000, ,000, ,000, ,000, ,000,000 Statutory deposit by the shareholders 15,000,000 15,000,000 15,000,000 15,000,000 15,000,000 15,000,000 Balance Of Funds And Accounts Life Insurance Fund 381,799, ,073,934 57,496, ,272,380 80,922,292 9,865,910 LIABILITIES AND PROVISIONS Estimated Liabilities in respect of outstanding claims, whether due or intimated 23,074,350 39,601,500 46,266,000 13,820,000 13,800,000 - Amount due to other persons or bodies carrying on insurance business 477,846-22,876 95,418 49,853 9,234 Sundry Creditors 10,322,022 80,960, ,470,124 80,489,150 33,281,514 18,324,051 Lease Finance ,747,202 4,361,972 - Reserve for unexpired risk - - 5,270, Premium Deposits 226, , , , ,458 88,081 Provision for share value fluctuation account - - 1,290,469 10,433,832 84,160 - TOTAL EQUITY AND LIABILITIES 715,899, ,871, ,959, ,008, ,657, ,287,276 PROPERTY AND ASSETS INVESTMENT (AT COST) Statutory deposit with Bangladesh Bank 15,000,000 15,000,000 15,000,000 15,000,000 15,000,000 15,000,000 Share listed on stock exchange 16,066, ,301,380 13,946,542 - Bangladesh Govt. Treasury Bond 33,800,000 33,800,000 28,800, Other Investment 76,321,227 67,941,949 38,171,551 23,925,329 - Outstanding Premium 19,972,699 19,325,713 11,872,647 5,813,187 1,037,186 1,079,361 Interest, Dividends And Rents Accruing but not due 30,393,981 24,813,171 15,631,740 8,300,427 3,392,332 1,404,000 Advances, Deposits and Sundry Debtors 25,462,867 26,683,258 17,581,180 13,068,086 7,316,855 3,057,835 Pre-incorporation expense - - 2,123,525 2,123,525 2,123,525 2,123,525 CASH AND OTHER BANK BALANCES Fixed deposits with Banks and Financial Institutes 223,760, ,260, ,500, ,700, ,900, ,000,000 Short term deposit with Banks 124,148,499 54,641,468 11,766,421 5,529,326 3,480, ,209 Current Account with Banks 781, , , ,560 7,920 12,290 Savings Account with Banks 454,709 8,786,186 6,412 6,727 11,667 - Cash in hand 2,364, ,847 1,782,108 1,351, , ,488 OTHER ACCOUNTS Stamps, Printing and Stationary in hand 78,562 84,567 41, ,239 28, ,766 Fixed Assets 105,829,516 73,819,320 45,403,326 38,713,066 25,683,557 10,862,791 Intangible Assets 41,466,010 21,003,255 27,639,134 36,304,873 14,068,178 8,720,010 TOTAL ASSETS 715,899, ,871, ,959, ,008, ,657, ,287,276 B. STATEMENT OF OPERATING RESULT INTEREST, DIVIDENDS AND RENTS Interest on STD 251, , , , ,532 2,366,965 Interest on Savings account 3,632 62, Interest on FDR 8,904,056 21,649,280 27,512,393 26,574,970 27,304,640 5,625,000 Interest on BGTB (Bond) 929,276 2,260,920-1,872,000 1,733,757 1,404,000 Interest on BGTB (Statutory) 1,427,016 1,872,000 1,392, Interest on DPS 2,581,112 2,843, ,263 27, Dividend from Shares , , Profit / (Loss) on Sale of Share - 4,093, , ,508 - Net Premium 280,357, ,720, ,658, ,963, ,945,971 17,528,775 Other Income 443,303 5,759, , ,927 85,940 43,

192 Prospectus of SLICL MANAGEMENT EXPENSES (Not applicable to any fund or account): 46,915,570 62,430,186 38,895,688 33,439,886 29,971,783 9,989,391 Salaries 25,397,773 51,419,450 42,600,606 21,571,078 16,740,015 4,935,686 Development salaries and allowance 22,665,580 15,420,971 11,122,053 11,197,354 7,840,004 - Development incentive 626,201 1,279, ,766 81,812 72,717 - Travelling and conveyance 82, , , , ,368 34,136 s Fees 156, , , , ,000 Audit Fees 25, ,000 25,000 25,000 Actuary Fees 1,150, Medical Fees 354, , , ,397 59,490 3,770 Legal and professional fees - 80, ,000 55,750 83,880 - Insurance policy stamp 1,000,000 2,500,000 1,100, , ,000 - Advertisement and promotional expense - 147, ,116 1,231, , ,150 Office Rent 11,182,852 28,080,258 15,239,687 12,305,894 7,493,575 30,000 Printing and Stationary 926,767 4,086,456 1,673, , , ,338 Bank Charges 1,267,564 1,629, , , ,348 - Financial Expenses 319,020 8,557,682 10,719,705 4,427,692-11,484 Brokerage Commission 18,036 13, Foreign currency loss 7,771 25, Repairs and Maintenance 92, , , , , ,662 Service Maintenance 1,007,598 1,148, , , Fuel, Oil Generator 34,125 87,880 55,530 40,524-14,430 Car Fuel, Maintenance & Repairs 56, , , , ,388 - Papers, Periodicals and Books 5,310 85,880 93,250 59,950 48,940 2,690 Telephone, Fax and Internet 726,903 1,341,055 1,247,770 1,587,644 1,054, ,573 Electricity & Utility Expenses 2,180,899 3,512,715 2,660,260 1,858, ,548 75,469 Training and Recruitment Expenses 18,000 8, , ,734 13,853 - Entertainment 583, , , , ,801 75,776 Insurance premium (General) 228, , , , ,710 - Postage and Courier 196, , , ,049 51,963 3,465 Business Development Expenses 331,768 2,833,029 1,475,462 1,912,781 1,001,473 - Prizes and Awards 72, , , ,630 15,000 - Company Registration (Renewal) Fees ,084 75,436 Stamps & Forms 30,000 62,790 27,285 50,240 43,264 13,815 Fees, Subscriptions and Donation 330,000 2,065,228 1,032, , ,657 - Meeting, Seminar & Symposium 398,900 1,624,527 1,544, ,011 73,637 99,021 Uniform 241,500 36,230 5, Conference - 481, Reserve for unexpired risk - - 5,270,007 Written off pre-incorporation expense - 2,123, Fair Expense ,040 Refreshment & Recreation 7,371,919 2,090, ,330-9,378 Provision for Commission expense for outstanding premium , , Provision for change in value of investment in shares ,349,672 84,160 - Depreciation on Fixed Asset 10,356,646 15,611,008 17,529,877 11,394,903 7,303, ,991 C. Dividend Declared Particulars Amount in Taka 30-Jun Dec Dec Dec Dec Dec-13 Cash Dividend (%) Stock Dividend (%) D. Sonali Life Insurance Company Limited was incorporated in Bangladesh as a Public Limited Company with the issuance of Certificate of incorporation bearing Reg. No. C /13 dated on 07 July 2013 under companies act The Company was also registered with the Insurance development and regulatory authority on 30 July, 2013 bearing registration no. Life 02/2013 under Insurance Act E. The Company started its commercial operation in 01 August F. The Company has no subsidiary as on the balance sheet date. G. No proceeds or part of the proceeds of the issue of shares would be applied directly by the company in the purchase of any business. H. The Company did not prepare any statement of accounts for the period subsequent to 30 June Date : 6 August 2018 Place : Dhaka sd/- AHMAD & AKHTAR Chartered Accountants 182

193 Prospectus of SLICL E) Financial Spread Sheet analysis for the latest audited financial statements SONALI LIFE INSURANCE COMPANY LIMITED STATEMENT OF FINANCIAL POSITION AS AT 30 JUNE 2018 Particulars Amount In Taka Amount In Taka Percentage A. SHAREHOLDER'S EQUITY AND LIABILITIES SHAREHOLDERS' CAPITAL Authorized Capital 100,000,000 Ordinary Shares of Tk.10 each 1,000,000,000 Grand Total ISSUED SUBSCRIBED AND PAID-UP 28,500,000 Ordinary Shares of Tk.10 each fully paid up in cash 285,000, Statutory Deposit by the Shareholders 15,000, BALANCE OF FUNDS AND ACCOUNTS 380,483, Life Insurance Fund LIABILITIES AND PROVISIONS 34,100, Estimated liabilities in respect of outstanding claims, whether due or intimated whether due or intimated 23,074, Amount due to other persons or bodies carrying on insurance business 477, Sundry Creditors 10,322, Premium Deposits 226, TOTAL CAPITAL AND LIABILITIES 714,583,838 Particulars Amount In Taka Amount In Taka Percentage Grand Total B. PROPERTY AND ASSETS LOANS On Insurers' Policies within their surrender value - INVESTMENT (AT COST) 141,187, Statutory Deposit with Bangladesh Bank 15,000, Bangladesh Govt. Treasury Boand 33,800, Investment In Shares 16,066, Other Investment 76,321, Outstanding Premium 19,972, Interest, Dividends and Rents Accruing but not due 30,393, Advances, Deposits and Sundry Debtors 24,146, CASH, BANK AND OTHER BALANCES 351,508, On Fixed Deposit with Banks & Financial Institutes 223,760, On Short Term Deposit with Banks 124,148, On Current Account with Banks 781, On Saving Account with Banks 454, Cash in Hand 2,364, OTHER ACCOUNTS 147,374, Stamps, Printing & Stationary in Hand 78, Fixed Assets (At Cost Less Depreciation) 105,829, Intangible Assets 41,466, TOTAL PROPERTY AND ASSETS 714,583, Date : 6 August 2018 Place : Dhaka sd/- AHMAD & AKHTAR Chartered Accountants 183

194 Prospectus of SLICL SONALI LIFE INSURANCE COMPANY LIMITED STATEMENT OF LIFE REVENUE ACCOUNT AS AT 30 JUNE 2018 Amoun In Taka Particulars Amount In Taka Percentage Grand Total Income Balance of Fund at the beginning of the year 253,073, Premium Less Re-Insurance: First Year Premium 228,198, Renewal Premium 50,074, Group Insurance Premium 2,707, Gross Premium 280,980, Less: Re-insurance Premium (623,654) (0.11) Net Premium 280,357, Interest, Dividend and Rents 14,096, Other Income 443, Total 547,971, Claims Under Policies (Including Provision For Claims due or intimated), less re-insurance: 30,054, Expense of Management 136,117, Commissio to Insurance agents 29,686, Allowances and commissions (Other than commission including in sub-item (a) preceding) 17,228, Salaries 25,397, Development salaries and allowance 22,665, Development incentive 626, Travelling and conveyance 82, s Fees 156, Audit Fees 25, Actuary Fees 1,150, Medical Fees 354, Insurance policy stamp 1,000, Office Rent 11,182, Printing and Stationary 926, Bank Charges 1,267, Financial Expenses 319,

195 Prospectus of SLICL Brokerage Commission 18, Foreign currency loss 7, Repairs and Maintenance 92, Service Maintenance 1,007, Fuel, Oil Generator 34, Car Fuel, Maintenance & Repairs 56, Papers, Periodicals and Books 5, Telephone, Fax and Internet 726, Electricity & Utility Expenses 2,180, Training and Recruitment Expenses 18, Entertainment 583, Insurance premium (General) 228, Postage and Courier 196, Business Development Expenses 331, Prizes and Awards 72, Stamps & Forms 30, Fees, Subscriptions and Donation 330, Meeting, Seminar & Symposium 398, Refreshment & Recreation 7,371, Depreciation on Fixed Asset 10,356, Balance of Fund at the end of the period/year 381,799, Total 547,971,

196 Prospectus of SLICL Certificate of long term and short term borrowings including borrowing from related party or connected persons with rate of interest and interest paid/accrued After due verification, we certify that the Long Term and Short Term Borrowing Including Borrowing from Related Party or Connected Persons of the Sonali life Insurance Company Limited for the last five years and six months made up as follows: For the Year ended 30 June, 2018 Name Of party Nature Of Relationship Nature Of Borrowing Balance as on 30 June, 2018 Interest Rate Interest Paid (BDT) Interest Accrued (BDT) N/A N/A N/A N/A N/A N/A N/A For the Year ended 31 december, 2017 Nature Of Name Of party Relationship SBAC Bank Limited (A/C# ) Farmers Bank Limited (A/C# ) Nature Of Borrowing Balance as on 31 Dec, 2017 Interest Rate Interest Paid (BDT) Interest Accrued (BDT) Lender Long Term 40,898,859 15% 4,016,091 - Lender Short Term % 3,925,116 - For the Year ended 31 december, 2016 Nature Of Name Of party Relationship SBAC Bank Limited (A/C# ) Farmers Bank Limited (A/C# ) Nature Of Borrowing Balance as on 31 Dec, 2017 Interest Rate Interest Paid (BDT) Interest Accrued (BDT) Lender Long Term 70,194,711 15% 8,244,298 - Lender Short Term 29,390, % 2,401,692 - Total 99,584,921 10,645,990 - For the Year ended 31 december, 2015 Nature Of Name Of party Relationship SBAC Bank Limited (A/C# ) Nature Of Borrowing Balance as on 31 Dec, 2017 Interest Rate Interest Paid (BDT) Interest Accrued (BDT) Lender Long Term 70,803,545 15% 3,928,746 - Total 70,803,545 3,928,746 - For the Year ended 31 december, 2014 Nature Of Nature Of Balance as on Interest Interest Paid Interest Accrued Name Of party Relationship Borrowing 31 Dec, 2017 Rate (BDT) (BDT) N/A N/A N/A N/A N/A N/A N/A For the Year ended 31 december, 2013 Nature Of Nature Of Balance as on Interest Interest Paid Interest Accrued Name Of party Relationship Borrowing 31 Dec, 2017 Rate (BDT) (BDT) N/A N/A N/A N/A N/A N/A N/A The Sonali life Insurance Company Limited does not have any Long Term and Short Term Borrowing from related Party or Connected Persons for the period from 01 January 2013 to 30 June sd/- Date : 6 August 2018 Place : Dhaka First Security Islami Bank Limited Ac# Lender Short Term - 15% 616, Total 40,898,859 8,557,682 - sd/- AHMAD & AKHTAR Chartered Accountants 186

197 Prospectus of SLICL Statement of principal terms of secured loans and assets on which charge have been Created against those loans This is to certify that the Principal Terms of Secured Loans as per Agreement and Assets on which charge have been Created Against Those Loans of Sonali life Insurance Company Limited for the year from 01 January 2013 to 30 June 2018 were as follows: Year Name Of Lenders Purpose 31-Dec Dec Dec Dec-15 SBAC Bank Limited (A/C# ) Farmers Bank Limited (A/C# ) SBAC Bank Limited (A/C# ) SBAC Bank Limited (A/C# ) Motor Vehicle Purchase Motor Vehicle Purchase Motor Vehicle Purchase Motor Vehicle Purchase Sanctioned Amount Rate Of Interrest Primary Security Collateral or other security Repayment Schedule Status 80,000,000 15% FDR N/A Monthly 40,898,259 31,250, % FDR N/A Monthly 29,390,210 80,000,000 15% FDR N/A Monthly 70,194,711 80,000,000 15% FDR N/A Monthly 70,803,545 Date : 6 August 2018 Place : Dhaka sd/- AHMAD & AKHTAR Chartered Accountants 187

198 Prospectus of SLICL Statement of unsecured loans with terms & conditions This is to certify that Sonali Life Insurance Company Limited has not taken any unsecured loan from any financial institute/related party/person for the last five years. Date : 6 August 2018 Place : Dhaka Certificate on inventories showing amount of raw material, packing material, stock-in-process and finished goods, consumable items, store & spares parts, inventory of trading goods etc. This is to certify that Sonali Life Insurance Company Limited has no inventories except Stamps, Printing and Stationary showing amount for the last five years. Particulars 30-Jun Dec Dec Dec Dec Dec-13 Stamps, Printing & Stationary Amount In Taka 78,562 84,567 41, ,239 28, ,766 Date : 6 August 2018 Place : Dhaka sd/- AHMAD & AKHTAR Chartered Accountants sd/- AHMAD & AKHTAR Chartered Accountants 188

199 Prospectus of SLICL Statement of trade receivables showing receivable from related party and connected persons This is to certify that, there is no such trade receivables showing receivables from related party and connected person except Outstanding Premium of Sonali Life Insurance Company Limited for the last five years. Amount in BDT Particulars December December December December December 30-Jun-18 31, , , , , 2013 General 19,972,699 19,325,713 11,872,647 5,813,187 1,037,186 1,079,361 From Related Party From Connected Persons Total 19,972,699 19,325,713 11,872,647 5,813,187 1,037,186 1,079,361 Date : 6 August 2018 Place : Dhaka Statement of any loan given by the issuer including loans to related party or connected persons with rate of interest and interest realized/accrued This is to certify that, there is no such loan given by Sonali Life Insurance Company Limited including loan to related party or connected persons hence there is no interest realized or accrued for last five years. Date : 6 August 2018 Place : Dhaka sd/- AHMAD & AKHTAR Chartered Accountants sd/- AHMAD & AKHTAR Chartered Accountants 189

200 Prospectus of SLICL Statement of other income showing interest income, dividend income, discount received and other non-operating income After due verification, other income showing interest income, dividend income, discount received, other non-operating income of Sonali Life Insurance Company Limited for the last five years as follows: Particulars 30-June-18 (6 months) 31-Dec Dec Dec Dec Dec-13 Interest Income 14,096,839 28,966,728 30,498,578 29,105,746 29,659,929 9,395,965 Dividend Income , , Discount Received Other Non-operating Income 443,303 5,759, , ,927 85,940 43,435 Profit or loss on sale share - 4,093, , ,508 - Total 14,540,142 38,819,498 31,122,483 30,559,537 29,867,377 9,439,400 Date : 6 August 2018 Place : Dhaka sd/- AHMAD & AKHTAR Chartered Accountants 190

201 Prospectus of SLICL Statement of turnover showing separately in cash and through banking channel After due verification, the turnover (Net Premium Income) showing separately in cash and through banking channel of Sonali Life Insurance Company Limited during last five years were as follows: Particulars Net Premium Income in cash Net Premium Income through banking channel 30-Jun-2018 (6 months) Amount in Taka 31-Dec Dec Dec Dec Dec ,357, ,720, ,658, ,963, ,945,971 17,528,775 Total turnover 280,357, ,720, ,658, ,963, ,945,971 17,528,775 Date : 6 August 2018 Place : Dhaka sd/- AHMAD & AKHTAR Chartered Accountants 191

202 Prospectus of SLICL Certification on statement of related party transactions of Sonali Life Insurance Company Limited After due verification, we certify that as per audited financial statements, books of accounts and records, the status of related party transactions of Sonali Life Perag Socks Industries Ltd. Dragon Sweater Bangladesh Ltd. Rupali Insurance Company Limited Golden Harvest Agro Industries Ltd. Golden Harvest Icecreame Ltd. Golden Harvest Foods Ltd Intraco CNG Ltd. Name of the Party Mrs. Noor-E-Hafza Mrs. Fauzia Quamrun Tania Rupali Insurance Company Limited (Represented by K.M. Farookh) Mrs. Shafia Sobhan Chowdhury Mr. Sheikh Mohammed Danial Mrs. Kamrun Nahar Mrs. Maya Rani Roy Mr. Sheikh Omar Faruque Mr. Omar Khayam Mr. Ahmed Rajeeb Samdani Mrs. Hazera Hossain Mrs. Hoda Ali Selim Imperial Sweater Industries Ltd. Dragon IT & Communication Ltd. Intraco Refueling Stations Limited Rupali Insurance Company Limited Date : 6 August 2018 Place : Dhaka Particulars Relationship with the Company Chairman & Shareholder Vice Chairman & Shareholder e & Shareholder e & Shareholder e & Shareholder e & Shareholder e & Shareholder e & Shareholder e & Shareholder e & Shareholder e & Shareholder e & Shareholder Common Common Common Common Common Common Common Common Common Common Common Nature of transaction Board Meeting Fee Board Meeting Fee Board Meeting Fee Board Meeting Fee Board Meeting Fee Board Meeting Fee Board Meeting Fee Board Meeting Fee Board Meeting Fee Board Meeting Fee Board Meeting Fee Board Meeting Fee Group Insurance Group Insurance Group Insurance Group Insurance Group Insurance Group Insurance Group Insurance Payable Investment Payable Office Rent Amount in Taka 30 June 2018 Amount in Taka 31 Dec Amount in Taka 31 Dec Amount in Taka 31 Dec Amount in Taka 31 Dec Amount in Taka 31 Dec ,000 20,000 20,000 20,000 20,000-13,000 20,000 20,000 20,000 20,000-13,000 20,000 20,000 20,000 20,000-13,000 20,000 20,000 20,000 20,000-13,000 20,000 20,000 20,000 20,000-13,000 20,000 20,000 20,000 20,000-13,000 20,000 20,000 20,000 20,000-13,000 20,000 20,000 20,000 20,000-13,000 20,000 20,000 20,000 20,000-13,000 20,000 20,000 20,000 20,000-13,000 20,000 20,000 20,000 20,000-13,000 20,000 20,000 20,000 20, ,000, ,000, ,000, , , , , , ,175 95, , , ,550 17, ,169, ,500, , , , , , sd/- AHMAD & AKHTAR Chartered Accountants 192

203 Prospectus of SLICL Certification regarding reconciliation of business income shown in the tax return with Net Income shown in audited financial statements. This is to certify that the business income of Sonali Life Insurance Company Limited as per audited financial statements and income are shown in the tax return for the last five years were as follows: Particulars Assessment Year Net Income before Tax as per Audited Financial Statements (Including Other 38,819,498 31,122,483 30,559,537 29,867,377 9,439,400 Income) Less: Management Expenses 119,112,004 65,774,938 61,878,749 47,645,482 15,056,869 Profit / (loss) as per 2(A) method, 4 th schedule of ITO, 1984 (80,292,506) (34,652,455) (31,319,212) (17,778,105) (5,617,469) Profit determination as per 2(B) method, 4th schedule of ITO, 1984 Surplus/(Deficit) as per Actuarial valuation Report as at 31 st December 74,387,000 (70,861,000) 2,737, Less: Surplus/(Deficit) as per Actuarial valuation Report as at 31st December 70,861,000 (2,737,000) Net surplus/(deficit) as at 31st December 145,248,000 (73,598,000) 2,737, Less: Policyholders proportion from the 90% 98,042,400 (49,678,650) 1,847, Taxable surplus/(deficit) as at 31 December 47,205,600 (23,919,350) 889, Add: Accounting Depreciation 15,611,008 17,529,877 11,394,903 7,303, ,991 Taxable surplus/(deficit) as at 31 December 62,816,608 (6,389,473) 12,284,428 (10,474,611) (5,193,478) Add: Inadmissible Expenses 250, , , ,000 50,000 63,066,608 (6,059,473) 12,474,428 (10,234,611) (5,143,478) Less: Admissible Expenses 18,381,749 16,989,942 24,112,712 12,232,351 5,332,176 Less: Accumulated Loss set off 44,684, Net taxable surplus/(deficit) as at 31 December - (23,049,415) (11,638,284) (22,466,962) (10,475,654) Date: 23 October 2018 Place: Dhaka sd/- AHMAD & AKHTAR Chartered Accountants 193

204 Prospectus of SLICL Confirmation that all receipts and payments of the issuer above Tk. 500,000/- (five lac) were made through banking channel After due verification, we confirm that all receipts and payments above Tk. 5,00,000/- (five lac) were made through banking channel by Sonali Life Insurance Company Limited during last five years Date : 6 August 2018 Place : Dhaka Auditors disclosure regarding confirmation that bank statements of the issuer are in conformity with its books of accounts After due verification, we confirm that the bank statements of Sonali Life Insurance Company Limited are in conformity with its books of accounts for last five years. Date : 6 August 2018 Place : Dhaka sd/- AHMAD & AKHTAR Chartered Accountants sd/- AHMAD & AKHTAR Chartered Accountants 194

205 Prospectus of SLICL Statement of payment status of TAX, VAT and other taxes/duties This is to certify that the payment status of income tax and other taxes/duties of Sonali Life Insurance Company Limited are as follows: Particulars 30-Jun-2018 (6 months) Pament Status Amount In Taka 31-Dec Dec Dec Dec Dec-13 Tax 571,343 1,559,490 2,315,248 2,395,905 2,466, ,220 VAT 3,302,238 3,131,343 1,364, , ,092 36,973 Other Taxes Duties Total 3,873,581 4,690,833 3,679,386 3,275,883 2,931, ,193 Date : 6 August 2018 Place : Dhaka sd/- AHMAD & AKHTAR Chartered Accountants 195

206 Prospectus of SLICL The Average Cost of Acquisition of Equity Shares by the s certified This is to certify that all the shares of the Sonali Life Insurance Company Limited have been allocated to its s in Cash or Bonus and the average cost of acquisition of equity by the directors and necessary particulars of shareholdings, allotments dates and consideration are given below: No. of Shares Held Date Nature of Transactio n Rupali Insuranc e Co. Ltd. Fauzia Quamru n Tania Shafia Sobhan Chowdhur y Sheikh Mohamma d Danial Noor-E- Hafza Ahmed Rajeeb Samdani Hazera Hossain Omar Khayam Sheikh Omar Faruque Kamrun Nahar Maya Rani Roy Hoda Ali Selim Consideration Average Acquisition cost of shares Tk By Subscription MOA 3,000,000 2,450,00 0 1,930,000 1,500,000 1,160,00 0 1,030,00 0 1,030,00 0 1,000,00 0 1,000,00 0 1,000, , ,000 Cash By Allotment 1,566,000 1,936,50 0 1,700,000 2,195,000 1,767, , , , , ,000 Cash Total 4,566,000 4,386,50 0 3,630,000 3,695,000 2,927,50 0 1,530,00 0 1,285,00 0 1,000,00 0 1,000,00 0 1,150,00 0 1,000,00 0 1,000,00 0 Place: Dhaka Date: 6 August, 2018 Sd/- AHMAD & AKHTAR Chartered Accountants 196

207 Prospectus of SLICL Auditor s certificate regarding any allotment of shares to any person for any consideration otherwise than cash along withrelationship of that person with the issuer and rationale of issue price of the shares This is to certify that Sonali Life Insurance Company Limited has not allotted any shares for consideration other than in cas h to any person up to 30 June Place: Dhaka Date: 6 August, 2018 Sd/- AHMAD & AKHTAR Chartered Accountants 197

208 Prospectus of SLICL CHAPTER- XXVII: CREDIT RATING REPORT 198

209 BDT Million Growth (%) Prospectus of SLICL Report Contents: Particulars Page Rating Rationale 1 Company Profile 2 Corporate Governance 2 Management Evaluation 2 Operational Overview 3 Financial Review 5 Key Snapshot: BDT. in million Particulars st Year Premium Renewal Premium Group Insurance Premium Net Premium Life Fund Total Asset Investment Net Surplus Paid up capital Yield on Life Fund 24.0% - Investment Yield 10.4% 10.4% First Year Premium 20.2% 33.2% Collection Cost Expense Ratio 48.8% 71.0% Performance: Analysts: First Year Premium Renewal Premium Group Insurance Premium Nafiz Iftekhar nafiz@wasocreditrating.com Md. Mirazul Islam miraz@wasocreditrating.com Growth of Life Fund CPA Rating Long Term Rating 2018 BBB2 Date of Rating Declaration 18 September 2018 Date of Rating Expiry 17 September 2019 Financial Based on-audited financial statements up to 31 December Methodology: Corporate rating methodology published on the WCRCL website at RATING RATIONALE WASO Credit Rating Company Limited (WCRCL) has assigned BBB2 (Triple B Two) Claim Paying Ability (CPA) rating to Sonali Life Insurance Company Limited (hereinafter referred SLIC) in the long term. WCRCL assigned the CPA rating based on audited financial statements upto 31st December 2017, Actuarial Valuation Report as at 31st December 2017 and other relevant management provided quantitative and qualitative data upto the date of rating declaration. The above rating has been assigned in consideration of its steady persistent in business, operating performance particularly in last year, seven days claim settlement policy impacted zero balance of claim outstanding, improving renewal premium impacted lapse in policies and establishing good governance in management along with experienced management team. The above factors are, however, constrained to some extent by volatile underwriting performance, low contribution of renewal premium to gross premium, moderate lapse ratio, age of business subsequently impacted life fund and surplus amount and marginal liquidity ratio positioned lower state of industry. First year premium of the company experienced increasing trend over the last 5 years along with the renewal premium at the same time. The Company reported a growth in life fund (grew by %) in the last years, though volatile trend revealed compare to last three years. First year s premium contributed 75% in gross premium where as renewal premium contributed only 15% which seems low in Besides, Group Insurance premium also gradually decreased. During 2017, death claims amounting BDT 5.2 million was lodged. Of the total death claims BDT 4.7 million was paid during The Company also repudiated claims of BDT 0.5 million. Therefore, outstanding claim at the end of year was nil. As per policy they settled every claim within 7 (Seven) days that is why SLIC have no claim outstanding since their commencement in On an average 1.1% of the policies were lapsed in the first year of issuance. On the other hand, on an average 21.8% and 33.1% of the total policies lapsed in the second year and third year of issuance respectively. If we consider three years data during , average of total lapse stood at 57%. However, average lapse ratio revealed moderate, considering latest five years data, stood at 38.4%. According to the actuarial valuation report as at 31st December 2017, there was net surplus of BDT million for the valuation period January 2017 to December In 2017, the Company kept BDT million as Life fund as against Net liability of BDT million. Therefore, total surplus as on 31 December 2017 was BDT million which was available for distribution as bonuses with profit policies and dividend to shareholders for the valuation period. Compare to other insurers in the industry life fund amount ranked low though SLIC achieved surplus of BDT million within short span of time. The company invested BDT million as of 31st December 2011 where the investment yield reported 10.39% in 2017 (average: 10.82%). Major portion of investment included FDR (61% of total investment), government securities (13%), ordinary shares (5%) and Property & Others (21%). Liquid asset to Life fund showed marginal ratio of 1.13x in 2017, however, moderate but scope to improve the ratio. Liquid assets to life fund of the Company decreased by 2.8 times in 2017 due to sharp increase of life fund same time. CPA rating in this category is adjudged to offer moderate claims paying ability with medium financial security characteristics. But changes in underwriting and/or economic conditions are likely to have impact on the capacity to meet policyholder obligations than insurers in higher rated categories. 199

210 Prospectus of SLICL Company Profile Sonali Life Insurance Company Limited (hereafter referred as Soanli Life or the Company or SLIC) incorporated as public limited company and started operation on 01 August The Company has accorded registration to transact all classes of Life Insurance Business in Bangladesh. As on 31 December 2017, Authorized capital and Paid up capital of the Company stood at BDT 1,000.0 million and BDT180.0 million respectively. The Company already raised life fund of BDT million along with a statutory deposit of BDT 15.0 million. The Company recognized from IDRA for their integrated ERP software which brings operating efficiency and transparency. Sonali Life is an allied concern among well established Dragon group (RMG) and Rupali Insurance Company Limited. Sonali Life has their re-insurance treaty with Scor Globl Life SE (Singapore Branch). Registered office is located at Rupali Bima Bhaban, 7 Rajuk Avenue, Motijheel C/A, Dhaka-1000 and Annexed office is located at 68/B, DIT road, Malibagh Chowdhury Para, Dhaka Corporate Governance Presently the Board is comprised of 14 members, each having sufficient exposure to diversified industrial sectors. Mrs. Noor-E-Hafza is the Chairman of the Board who is also the of Farnoor Garments Limited. She also served in Bangladesh Chemical Industries Corporation (BCIC) and worked as chief nutritionist in National Nutrition Council.Mrs. Fauzia Quamrun Tania is the Vice Chairman of the Board. Annexure 1 shows the shareholding composition of Sonali Life as of 31st December The board of SLIC had 5 meetings in The Board has formed 2 (Two) Committees, each of which is headed by a. These Committees are: (1) Nomination & Remuneration and (2) Audit Committee. Management Senior Management The management team is headed by Ajit Chandra Aich, Managing who has been in the insurance profession for last 33 years. The Managing is assisted by a Senior Management Group. As on 31st December 2017 the company had total 164 employees in 55 branches. The Board has formed 2 (Two) Committees, each of which is headed by a. These Committees are: (1) Nomination & Remuneration and (2) Internal Audit. The management of the Company has formed an Audit Committee. This committee is comprised of Vice Chairman along with two s. This committee audited different branches periodically and reports about any irregularity in the business operation to the Chairman, Audit Committee through the Managing. Management delegates Senior Manager of Audit from time to time to conduct audit of various departments of HO and branches of the Company. After conducting audit and verification activities of various departments of HO and branches; Senior Manager of Audit reports to the management on his audit and verification. The management also operated another committee named Nomination and Remuneration committee. They have plan to form another two committee like- Purchase and Business Development Committee. 200

211 BDT Million Growth (%) Prospectus of SLICL Operational Overview Product Mix and Performance The Company has introduced eighteen polices. Ordinary Endowment Insurance Plan with profit, Three Payment Anticipated Endowment Insurance Plan, Five Payment Anticipated Endowment Insurance Plan,Ordinary Endowment Insurance Plan without profit,money Back Term Insurance Plan with Guaranteed Profit, Child Protection Plan, Single Premium Assurance Plan, Education Expense Assurance Plan, Assurance-cum-Pension Plan, Denmohor Bima Plan, Hajj Bima Plan, Monthly Saving Assurance Plan, Monthly Saving Micro Insurance Plan, Mortgage Assurance Plan, Group TermLife Insurance, Accidental Death Benefit, Permanent Disability and Accidental Benefit Plan. For the last five years, average cost of premium collection to first year premium was 59% (2016: 66%) which includes agency commission and allowances. Product Mix and Premium Particulars First Year Premium First Year Premium as % of Gross Premium 75.66% 59.90% 22.77% 27.73% Renewal Premium Renewal Premium as % of Gross Premium 14.80% 19.72% 9.50% 0.39% Gross Premium Net Premium Growth of First Year Premium % % 28.38% % Growth of Renewal Premium 56.46% 71.66% % - Growth of Net Premium % % 56.32% % First year premium of the company experienced increasing trend over the last 5 years along with the renewal premium at the same time. Usually, the Company sells all its insurance products through insurance agents. The company has a wide development network to sell its products. In 2017, 75.66% of gross premium was generated from first year premium and the rest from renewal premium (14.80%). According to the existing rule, 96.5% of 1st year premium is allowed as management expense whereas only 20% of the renewal premium is allowable in this regard (for companies of four to six years of operation). Therefore, life insurance companies having higher renewal premium are more profitable. But still, the Company s renewal premium was less compared to first year premium over the periods. However, SLIC showed a steady operating growth last year First Year Premium Group Insurance Premium Renewal Premium Growth of Life Fund 201

212 Prospectus of SLICL Growth of the Key performance Indicators Company s net premium earnings and gross premium earnings evident an increasing business trend. Life Fund grew sharply in 2017 due to aggressive business that time. Investment also grew at a steady rate. Overall business was stridently set a new benchmark in 2017, now challenge is to settle at that benchmark. Group Insurance Premium reduced gradually compare to 2015 & 2016 which had a great potential for the Company. Renewal Premium also needs to increase as stated earlier life insurance companies having higher renewal premium are more profitable because it costs less management expense. Year to year comparison regarding renewal premium revealed that SLIC made a growth of 56.46% in 2017 and 71.66% in Net Claim of the Company decreased by 68.23% though in 2017 there was an aggression in first year premium and renewal premium. Investment increased by 42.42%, mostly invested to Government Treasury Bond, DPS and Placement Share in capital market. Key Performance Indicators Year (Mil. BDT) Amount Growth Amount Growth Amount Growth First Year Premium % % % Renewal Premium % % % Group Insurance % % % Net Premium % % % Net Claim % % % Life Fund % % % Investment % % % Total Assets % % % Policy Lapse It is observed from following table that an average 1.1% of the policies were lapsed in the first year of issuance. On the other hand, on an average 21.8% and 33.1% of the total policies lapsed in the second year and third year of issuance respectively. If we consider three years data during , average of total lapse stood at 57%. However, average lapse ratio revealed moderate, considering latest five years data, stood at 38.4%.Low lapse ratio helps the insurance companies to grow life fund rapidly. Lapse Ratio Year 1st Year 2nd Year 3rd Year Total % 23.0% 37.0% 60.1% % 27.3% 32.0% 59.7% % 20.0% 30.4% 51.9% % 17.0% % % % Average 1.1% 21.8% 33.1% 38.4% However, high policy lapse is very common in the life insurance industry in Bangladesh. The management of the Company has informed that they have a plan to reduce the number of lapse policies in the future. Already the policies in motion to reduce lapses are- a. continues 202

213 Prospectus of SLICL liaison with clients or policy holders; b. dedicated customer service; c. call centre for giving reminder prior to maturity date of premium payment, in digitalized way etc. Year % of Policy Lapsed out of the Policies Issued as shown in Column % 0.0% 0.0% 0.0% 0.0% % 1.7% 0.0% 0.0% 0.0% % 20.0% 1.4% 0.0% 0.0% % 32.0% 27.3% 0.4% 0.0% % 0.0% 37.0% 23.0% 0.1% Financial Review Underwriting Quality Underwriting process of SLIC determines whether or not to accept a proposal for insurance and if accepted, the terms and conditions to be applied and the level of premium to be charged. Weak underwriting quality poses risk to the long term volatility of a company. High competition in the market and first year premium affects the industry as a whole. Generation gap of the firms within the industry also affects the process. The analysis found that SLIC took standard procedure to minimize risk a by screening proposal of potential insured in the area his/her history, family background, health condition, medical requirement, confirmation from client several times along with confirming KYCand taking opinion of field officer and departmental agent. Premium Amount where the Maximum Period yet to be paid Single yrs~11 yrs yrs or more Renewal premium Group premium Management Expenses Management expense includes staff salary, agency commission and administrative expense. The Company was allowed [Insurance Act 2010, Rule: 39] to incur management expenses of BDT million, whereas the Company incurred BDT million. So, excess management expense was % of the allowable management expense in However, it was a good indication that First year premium collection cost gradually deteriorated. Though trend of expense ratio revealed volatile this needed to be low. Allowable Management Expense (BDT Mil) Actual management expense Allowable management expense Excess Expense * (175.3) (22.8) (4.0) 10.6 (0.4) Excess Expense (175.3) (22.8) (4.0) 10.6 (0.4) Excess Expense as % of allowable expense % % -4.04% 18.11% -2.40% * positive figures means actual expense exceeds allowable, negative figures means reverse. 203

214 Prospectus of SLICL Claim Settlement The Company has separate claim settlement department to monitor and expedite the claim settlement. During 2017, death claims amounting BDT 5.2 million was lodged. Of the total death claims BDT 4.7 million was paid during The Company also repudiated claims of BDT 0.5 million. Therefore, outstanding claim at the end of year was nil. According the Management s Claim settlement policy they settled every claim within 7 (Seven) days that is why SLIC have no claim outstanding since their commencement in 2013, the claim settlement ratio of the Company was 100% whereas claim paid to total claim was 91%. According to the management, claims were repudiated because of proper documentation lack or for violation of insurance clauses. Death Claim Settlement (Individual) Particulars Amount Unit Amount Unit Amount Unit Claims Outstanding at the Beginning Claims Lodged during the Year Total Claims Claims Paid during the Year Claims Paid as % of Total Claims 91% 89% 68% 71% 100% 100% Claims Repudiated during the Year Claims Repudiated as % of Total Claims 9% 11% 32% 29% 0% 0% Claims Settled during the Year Claims Settled as % of Total Claims 100% 100% 100% 100% 100% 100% Claims Outstanding at the End Capital Adequacy and Liquidity Capital Adequacy and Liquidity Required Paid up Capital Paid up Capital Maintained Liquid Asset/Life fund 113% 401% 220% 303% 1835% Paid up Capital of the Company stood at BDT million, which was steady from the beginning though it needs to be enhancing to minimum BDT million. The minimum regulatory paid up capital requirement for life insurance companies is now BDT million. As of 31st December 2017, the shortfall of paid-up capital of SLIC was BDT million. The Company has a plan to raise its paid up capital through public offering. Composition of Core Assets [2017] Liquid Assets as % of Life Fund [2017] Collection in hand 61.7% Fixed Deposit 21.5% Fixed Assets 0.1% Cash in hand 3.1% Current and STD accounts 10.2% Treassry Bond 3.3% 450% 400% 350% 300% 250% 200% 150% 100% 50% 0% Liquid Asset/Life fund 204