CONTENTS 02 Corporate Information CONSOLIDATED 03 Notice of 27th Annual FINANCIAL STATEMENTS General Meeting Independent Auditors’ Report Six Years’ Statistics 122 08 to the Members 10 Chairman’s Review 127 Consolidated Statement of 11 Directors’ Report to the Shareholders - Financial Position English & Urdu 128 Consolidated Profit and Loss Account UNCONSOLIDATED 129 Consolidated Statement of FINANCIAL STATEMENTS Comprehensive Income 130 Consolidated Statement of 28 Statement of Internal Controls Changes in Equity 29 Statement of Compliance 131 Consolidated Cash Flow Statement 31 Independent Auditors’ Review Report 132 Notes to the Consolidated to the Members Financial Statements 32 Independent Auditors’ Report 196 Pattern of Shareholding to the Members 201 Form of Proxy - English Unconsolidated Statement of 37 Form of Proxy - Urdu Financial Position 203 38 Unconsolidated Profit and Loss Account 39 Unconsolidated Statement of Comprehensive Income 40 Unconsolidated Statement of Changes in Equity 41 Unconsolidated Cash Flow Statement 42 Notes to the Unconsolidated Financial Statements 110 Report of Shariah Board - English & Urdu CORPORATE INFORMATION BOARD OF DIRECTORS AUDITORS Lt Gen Syed Tariq Nadeem Gilani, HI (M) (Retd) M/s A. F. Ferguson & Co. Chartered Accountants Chairman / Non-Executive Director Lt Gen Javed Iqbal, HI (M) (Retd) LEGAL ADVISORS Non-Executive Director M/s RIAA, Barker Gillette Lt Gen Tariq Khan, HI (M) (Retd) Advocates & Corporate Counsellors Non-Executive Director Dr. Nadeem Inayat SHARIAH BOARD Non-Executive Director Mufti Muhammad Zahid - Chairman Mr. Rehan Laiq Mufti Ismatullah - Member Non-Executive Director Dr. Muhammad Tahir Mansoori - Resident Shariah Board Member Mr. Manzoor Ahmed Non-Executive Director / NIT Nominee COMPANY SECRETARY Mr. Shahid Abbasi, FCA Mr. Kamal A. Chinoy Independent Director REGISTERED OFFICE Syed Ahmed Iqbal Ashraf Independent Director AWT Plaza, The Mall, P. O. Box No. 1084 Rawalpindi - 46000, Pakistan Mr. Mushtaq Malik Independent Director Tel: (92 51) 8092624 UAN: (92 51) 111 000 787 Brig. Saleem Ahmed Moeen, SI (Retd) Independent Director Fax: (92 51) 2857448 Email: [email protected] Mr. Abid Sattar President & Chief Executive REGISTRAR & SHARE TRANSFER OFFICE BOARD COMMITTEES Central Depository Company of Pakistan Limited AUDIT Mezzanine Floor, South Tower, LSE Plaza 19-Khayaban-e-Aiwan-e-Iqbal, Lahore Syed Ahmed Iqbal Ashraf - Chairman Tel: Customer Support Services (Toll Free) Dr. Nadeem Inayat 0800-CDCPL (23275) Mr. Rehan Laiq Tel: (9242) 36362061-66 Mr. Manzoor Ahmed Fax: (92 42) 36300072 HUMAN RESOURCE & REMUNERATION Email: [email protected] Lt Gen Javed Iqbal, HI (M) (Retd) - Chairman Website: www.cdcpakistan.com Dr. Nadeem Inayat Syed Ahmed Iqbal Ashraf ENTITY RATINGS Long Term: AA+ Mr. Mushtaq Malik Short Term: A1+ Mr. Kamal A. Chinoy By PACRA RISK MANAGEMENT Mr. Manzoor Ahmed - Chairman WEBSITE www.akbl.com.pk Dr. Nadeem Inayat Mr. Rehan Laiq SOCIAL MEDIA Brig. Saleem Ahmed Moeen, SI (Retd) /askaribankpakistan Mr. Abid Sattar /askari_bank INFORMATION TECHNOLOGY Brig. Saleem Ahmed Moeen, SI (Retd) - Chairman Dr. Nadeem Inayat Askari Bank Limited 02 Mr. Abid Sattar NOTICE OF THE 27TH ANNUAL GENERAL MEETING Notice is hereby given that the 27th Annual General Meeting (AGM) of the shareholders of Askari Bank Limited (the “Bank”) will be held on Monday, March 25, 2019 at 10:00 am at Topi Rakh Complex (Galaxy Hall), Army Heritage Foundation, Ayub National Park, Jhelum Road, Rawalpindi to transact the following business: Ordinary Business: 1. To confirm the minutes of the 26th Annual General Meeting held on March 30, 2018. 2. To receive, consider and adopt the financial statements of the Bank for the year ended December 31, 2018 together with the Directors’ and Auditors’ Reports thereon. 3. To appoint statutory auditors of the Bank and Wholesale Banking Branch (Bahrain) for the year ending December 31, 2019 and to fix their remuneration. The present auditors of the Askari Bank Limited and Wholesale Banking Branch (Bahrain), M/s A. F. Ferguson &. Co., Chartered Accountants and PricewaterhouseCoopers (PWC) respectively, being eligible, have offered themselves for re-appointment. 4. To approve, as recommended by the Board of Directors, payment of final cash dividend @ 10% i.e., Re. 1 per share for the financial year ended December 31, 2018. Special Business: 5. To consider and approve amendments / alterations in the Articles of Associations of the Bank with or without any amendments, modifications or alterations, in light of the changes in the Companies Act, 2017, the Banking Companies Ordinance, 1962 and the applicable Prudential Regulations of the State Bank of Pakistan (SBP). The Statement of Material Facts providing the information as required under Section 134(3) of the Companies Act 2017 is appended below. Other Business: 6. To consider any other business as may be placed before the meeting, with the permission of the Chair. By Order of the Board Rawalpindi Shahid Abbasi March 1, 2019 Company Secretary 2018 Annual Report 03 NOTICE OF THE 27TH ANNUAL GENERAL MEETING Statement of Material Facts Agenda Item 5: Statement under Section 134(3) of the Companies Act, 2017 – Amendments / Alternations in the Articles of Association of the Bank The statement sets out the material facts pertaining to the special business to be transacted at the 27th Annual General Meeting of the Bank to be held on Monday, March 25, 2019. The existing Articles of Association (AoA) of Askari Bank Limited were required to be revised to align it with legislative changes and requirements brought about by the Companies Act, 2017, Listed Companies (Code of Corporate Governance) Regulations 2017, Securities Act 2015, Pakistan Stock Exchange Limited Regulations, other applicable rules & regulations and ensure its conformity with the Banking Companies Ordinance 1962, and various other requirements of the State Bank of Pakistan. Accordingly, the existing document has been amended / altered and the revised AoA will be laid before the members in the Annual General Meeting scheduled on March 25, 2019. In accordance with the requirements of Section 134(3) of the Companies Act, 2017, the revised AoA along with the proposed special resolutions pertaining to the alteration in the AoA and comparative table of amendments are provided in the DVD, as integral part of this notice and are also placed on the Bank’s website at https://akbl.com.pk/ investor-relations/shareholders. If approved by the members, the proposed Special Resolution(s), with or without modifications, will be adopted to approve revisions in the AoA. Interest of the Directors and their relatives None of the directors or their relatives have any personal interest in alternation / amendments / substitution of Articles of Association of the Bank except in their capacity as Shareholder or Directors of the Bank. Inspection of Documents Copies of Memorandum & Articles of Association of the Bank, Statement under section 134 (3) of the Companies Act, 2017, financial statements and other related information / documents of the Bank which may be inspected / procured during business hours on any working day at the Head Office of the Bank from the date of publication of this notice till conclusion of the Annual General Meeting. NOTES 1. The Share Transfer books of the Bank will remain closed from March 19, 2019 to March 25, 2019 (both days inclusive). Transfers received at the Bank’s Share Registrar Department, Central Depository Company of Pakistan Limited, Mezzanine Floor, South Tower, LSE Plaza, 19-Khayaban-e-Aiwan-e-Iqbal, Lahore the Registrar and Share Transfer Office of the Bank at the close of the business hours on March 18, 2019 will be treated in time. 2. A member entitled to attend and vote at the meeting is entitled to appoint a proxy to attend and vote for him / her. No person shall act as a proxy, who is not a member of the Bank except that Government of Pakistan [GoP] or SBP or corporate entity may appoint a person who is not a member. 3. The instrument appointing a proxy should be signed by the member or his / her attorney duly authorized in writing. If the member is a corporate entity (other than GoP and SBP), its common seal should be affixed on the instrument. Askari Bank Limited 04 4. The instrument appointing a proxy, together with attested copy of Power of Attorney or Board Resolution, if any, under which it is signed or a notarially certified copy thereof, should be deposited, with the Company Secretary, Askari Bank Limited, 4th Floor, NPT Building, F-8 Markaz, Islamabad not less than 48 hours before the time of holding the meeting. 5. If a member appoints more than one proxy, and more than one instrument of proxy is deposited by a member, all such instruments of proxy shall be rendered invalid. The proxy form shall be witnessed by two persons whose names, addresses and Computerized National Identity Card (CNIC) numbers shall be mentioned on the form. 6. Copy of the CNIC or passport of the beneficial owners shall be furnished with the proxy form. The proxy shall produce his / her original CNIC or original passport at the time of attending the meeting. 7. In case of individual shareholder, original CNIC or original passport while for the CDC account holder or sub-account holder and or the person whose securities are in group account and their registration details are uploaded as per the regulations, his / her authentication would be made by showing his / her original CNIC or original passport along with participant(s) ID Number and their account numbers. In case of GoP / SBP / corporate entity, the Board of Directors’ resolution / power of attorney with specimen signature shall be submitted along with proxy form to the Bank. 8. The Government of Pakistan through the Finance Act, 2018 has made certain amendments in terms of Section 150 of the Income Tax Ordinance, 2001 whereby the rates are enhanced for deduction of withholding tax on the amount of dividend paid by the companies / banks.