UBL Standalone Financial Statements 2021 With DR Report

United Bank Limited
UNCONSOLIDATED FINANCIAL STATEMENTS

AS AT DECEMBER 31, 2021
UNITED BANK LIMITED
DIRECTORS’ REPORT TO THE MEMBERS
On behalf of the Board of Directors, we are pleased to present the 63rd Annual Report of United Bank
Limited (UBL or the Bank) for the year ended December 31, 2021.
Performance Overview
On a standalone basis, UBL recorded a Profit Before Tax (PBT) of Rs. 52.1 billion for the year 2021,
posting a strong growth of 52% over 2020.
Gross revenues were recorded at Rs. 95.1 billion for 2021, growing by 3% over 2020. The Bank
recorded net markup income of Rs. 71.8 billion for 2021 (2020: Rs. 75.0 billion) as interest rates
remained relatively lower during most part of the year. Non-markup income was recorded at Rs. 23.4
billion for 2021, higher by 37% year on year, with timely realization of capital gains, primarily on the
international bonds portfolio and strong growth across major fee based revenues.
The Bank’s operating expenses were recorded at Rs. 42.7 billion for 2021, well contained with an
increase of 7% over last year. The cost to income ratio was recorded at 44.9% in 2021 compared to
43.5% in 2020.
The Bank recorded a net provision reversal of Rs. 955 million in 2021 as against a net provision
charge of Rs. 16.8 billion in 2020, owing to strong recovery efforts across domestic and international
and enhanced risk monitoring of the asset book.
Financial Results
UBL posted an unconsolidated profit after tax (PAT) of Rs. 30.9 billion for 2021, a growth of 48% over
2020. The unconsolidated earnings per share (EPS) were recorded at Rs. 25.23 as against Rs. 17.07
last year. On a consolidated basis, PAT stood at Rs. 30.6 billion (2020: Rs. 20.8 billion). The
consolidated EPS was measured at Rs. 24.84 for 2021 (2020: Rs. 17.10).
Net Markup Income
UBL’s net markup income for the year 2021 stood at Rs. 71.8 billion, down 4% year on year. The
bank’s mark-up earning asset base averaged Rs. 2.0 trillion in 2021, with an increase of 20% over last
year. Bank level net interest margins (NIM)s were measured at 3.8% for 2021 (2020: 4.8%). Interest
rates remained lower in 2021 as the benchmark policy rate averaged 7.3% in 2021 versus 8.6% in
2020, which restricted the overall interest earnings profile of the banking sector.
Directors’ Report FY 2021 Page |1

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The average deposits base for the domestic bank reached the Rs. 1.5 trillion mark in 2021, growing
by a strong 19% year on year. This was mainly on the back of a strong growth in CASA deposits which
averaged Rs. 1.3 trillion in 2021, increasing by 20% year on year, with highest ever portfolio growth
of Rs. 215 billion this year. The average CASA to total deposits ratio improved from 85% in 2020 to
86% in 2021.
The Branch Banking Group continues to be the main driver of the Bank’s earnings with sales and
distribution efforts centered around deepening the core deposits base. The Bank continues to
expands its customer base as it added 564,000 NTB current accounts in 2021 (2020: 571,000 NTB
current accounts). These new acquisitions enabled strong growth of 18% in current deposits year on
year, with average volume of Rs. 635 billion in 2021. The domestic average savings portfolio was
measured at Rs. 661 billion, with a very robust growth 22% year on year. This strong growth in low
cost deposits enabled the domestic bank to reduce its cost of deposits from 4.5% in 2020 to 3.6% in
2021.
Within UBL International, the key focus during the year was to improve and diversify the funding
base. UBL International’s average deposits were measured at USD 1.3 billion for 2021, declining by
10% year on year, while the cost of deposits reduced sharply by 50 bps, from 1.6% in 2020 to 1.1% in
2021.
Bank level performing advances averaged Rs. 553 billion, declining by 3% year on year (2020: Rs. 569
billion). The domestic portfolio of performing advances averaged Rs. 445 billion, largely in line with
the levels maintained last year. Credit quality remains a primary determinant for new asset
acquisitions and more efficient capital allocation. The Bank continued its momentum within the
Islamic Banking space as the loan book averaged Rs. 37 billion in 2021, growing by 75% year on year.
Consumer loans averaged Rs. 19 billion, up by 11% year on year, with the portfolio predominantly
concentrated in the secured autos segment. UBL International’s performing loans portfolio averaged
USD 658 million, in line with last year, as the Bank remained highly cautious and prudent across the
GCC markets.
The Bank’s investments averaged Rs. 1.4 trillion in 2021, with a 34% growth year on year. The
domestic government securities portfolio averaged Rs. 1.2 trillion, with an increase of 38% over last
year, earning a healthy yield of 8.0% in 2021. UBL International’s earning investments comprised
largely sovereign government debt and averaged USD 719 million in 2021, an increase of 2% over last
year, earning the Bank healthy returns of 5.6% in 2021 (2020: 6.0%).

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Non-Markup Income
The Bank earned non-markup income of Rs. 23.4 billion in 2021, with an increase of 37%. Non
markup income made a significant contribution of 25% to total revenues coming from non-markup
based sources in 2021 (2020: 19%).
Fees and commissions were recorded at Rs. 13.1 billion in 2021, up 18%. Fees and commissions
constituted 56% of the total non-markup income in 2021 (2020: 65%). This performance is mainly
driven by the domestic franchise, which rebounded strongly with 24% growth.
Income from branch banking operations was recorded at Rs. 1.8 billion with an increase of 7%. The
Bank continues to be the leader in the home remittances business with a dominant market share of
over 20%, with revenues of Rs. 1.7 billion growing by 6%. Income from card related fees was
recorded at Rs. 2.5 billion for 2021, up 59% year on year as the debit cards portfolio increased to
nearly 2.7 million, with new debit card acquisitions of 703,000 during the year. The Bank also
continued its strong momentum in the bancassurance space, as premium volumes of Rs. 3.7 billion
were underwritten in 2021, which were up 41%. Resultantly, bancassurance commission income was
up 32%, recorded at Rs. 1.5 billion for 2021. Commission income from consumer finance was
recorded at Rs. 1.1 billion for 2021 and in line with robust auto sales was up 25%. The Bank earned
investment banking fees of Rs. 480 million in 2021 as against Rs. 330 million in 2020, originating from
debt arrangement and advisory mandates. Commission income from trade and guarantee business
was recorded at Rs. 1.2 billion in 2021 (2020: Rs. 1.3 billion), which continues to be a key focus area.
Commissions from cash management operations were recorded at Rs. 980 million in 2021, growing
by 16%, with throughput volumes witnessing a significant increase driven by employee banking
mandates, well supported by the Bank’s digital corporate portal.
Foreign exchange income was recorded at Rs. 4.0 billion in 2021, growing by 8% with active trading
and better customer flows. Dividend income of Rs. 2.0 billion was earned in 2021 as against Rs. 1.3
billion in 2020, with strong payouts from energy and fertilizer holdings and better subsidiary payouts.
Aggressive trading to seize market opportunities primarily within equities and foreign debt securities
markets resulted in capital gains of Rs. 3.8 billion in 2021 as against Rs. 411 million earned in 2020.
Provisions, loan losses and non-performing loans
The Bank recorded a net provision reversal of Rs. 955 million in 2021 as against a net provisioning
charge of Rs. 16.8 billion in 2020.
Bank level non-performing loans (NPL)s increased from Rs. 83.6 billion as at Dec’20 to Rs. 86.0 billion
at Dec’21. Overall asset quality improved from 13.7% at Dec’20 to 11.8% at Dec’21, while specific
coverage was enhanced from 85.8% at Dec’20 to 86.9% at Dec’21.

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UBL Domestic
Domestic NPLs declined from Rs. 28.7 billion at Dec’20 to Rs. 27.1 billion at Dec’21. A net provision
reversal of Rs. 2.0 billion was recorded within UBL Domestic, as against a net provision charge of Rs.
1.9 billion taken last year. Asset quality improved from 6.3% at Dec’20 to 5.0% at Dec’21, while
specific coverage was enhanced from at 85.7% at Dec’20 to 87.9% at Dec’21.
UBL International
UBL International has gradually stabilized after a significant period of de-risking. NPLs have declined
from USD 343 million at Dec’20 to USD 334 million at Dec’21. In order to further strengthen reserves
against non-performing accounts, a net provision charge of USD 6.2 million was recorded in the
current year as against a net provision charge of USD 91.8 million in 2020. This has resulted in
specific coverage improving from 85.9% at Dec’20 to 86.4% at Dec’21, while specific coverage with
Forced Sale Value (FSV) of mortgaged properties and cash collateral stood at 94.8% at Dec’21.
(Dec’20: 95.5%, refer note 9.4.3 to the financial statements).
Cost management
UBL remains focused on creating operational efficiencies across the branch network and with
support functions’ enhanced synergies and greater use of technologies to digitize the Bank’s
functions and processes. Administrative expenses were recorded at Rs. 42.7 billion for 2021,
increasing by 7%. Employee compensation was recorded at Rs. 16.4 billion, increasing by 6%, mainly
as a result of building capacity across the franchise. Property expenses were recorded at Rs. 7.0
billion, with an increase of 9% over 2020. IT related expenses were recorded at Rs. 4.4 billion for
2021, an increase of 7% over last year, as the Bank continued to invest in platforms under its
technology strategy. Other operating expenses stood at Rs. 14.9 billion, increasing by 7% year on
year mainly due to higher sales commissions as well as banking and other services charges in line
with the strong growth in business volumes in 2021.
Balance Sheet Management
UBL’s balance sheet size stood at Rs. 2.6 trillion as at Dec’21, growing by 28% over Dec’20. Bank level
period end deposits stood at Rs. 1.75 trillion at Dec’21, growing by 7% over Dec’20. The domestic
deposits base stood scaled the Rs. 1.5 trillion level at Dec’21, growing by 7% over Dec’20. The Bank
recorded an average market share of 8.3% of the total banking sector deposits in 2021 as against
8.1% maintained in 2020. Domestic current deposits closed Dec’21 at Rs. 720 billion, growing by a
strong 17% over Dec’20, while the saving portfolio stood at Rs. 620 billion, increasing by 4% over

UNITED BANK LIMITED
Dec’20. This enabled the Bank to improve its CASA to total deposits ratio from 85.2% at Dec’20 to
88.2% at Dec’21. Domestic term deposits portfolio stood at Rs. 179 billion, declining by 15% over
Dec’20. The Bank continued its strong momentum in the Islamic banking space as the deposit levels
for the business stood at Rs. 140 billion at Dec’21, growing be 25% over Dec’20. UBL International’s
deposits base stood at USD 1.3 billion at Dec’21, with a slight decline of 5% since Dec’20.
Bank level net advances closed at Rs. 646 billion at Dec’21, growing by a strong 22% over Dec’20.
Domestic performing advances stood at Rs. 517 billion, increasing by 20% year on year. The Bank’s
lending strategy continues to be based on maintaining an optimal asset quality level and improving
relationship yields. The Corporate loan book stood at Rs. 421 billion, with a strong growth of 17%
over last year. The Bank is aggressively expanding its Islamic business as performing advances stood
at Rs. 44 billion, increasing by more than two-folds over the Dec’20 levels of Rs. 21 billion. The
Consumer portfolio recorded an increase of 7% year on year while the SME book also had a strong
year, recording a growth of 11% over Dec’20. Gross advances to deposits ratio was measured at
41.6% at Dec’21, improving significantly from 37.1% recorded at Dec’20. UBL International’s net
advances stood at USD 715 million at Dec’21, growing by a strong 18% over the previous year with
book building mainly within the trade based financing and FI lending space.
UBL also continues to play an active role in all Government and SBP initiatives aimed at improving the
economic fortunes of the country. The Roshan Digital initiative continues to see healthy flows into
the country. UBL has been one of the main participants in this endeavor, having opened approx.
64,000 accounts and with inflows close to USD 378 million routed through the Bank. The bank also
continues to play a strong role in the housing initiative with more than Rs. 2.0 bln disbursed to
successful applicants. Furthermore, in order to financially empower the young population under the
Kamyab Jawan program, the bank crossed the Rs. 1.0 billion mark, to provide financing for
entrepreneurial as well as agri based projects.
The Bank’s investment portfolio closed at near Rs. 1.5 trillion as at Dec’21 (Dec’20: Rs. 1.1 trillion).
Within the domestic bank, funding is primarily deployed in government treasuries. During the year,
the fixed income Pakistan Investment Bond (PIB) book increased by Rs. 91 billion, as the overall
portfolio stood at Rs. 328 billion. The Floating PIB book stood at Rs. 413 billion at Dec’21, growing by
Rs. 73 billion over Dec’20, while treasury bills stood at Rs. 532 billion at Dec’21. The investment book
remains well diversified across the shorter and longer tenor investment horizons, positioned to take
full advantage of a rising yield curve. Islamic Investments, comprising mainly of government and
corporate debt instruments, stood at Rs. 87 billion, with a strong growth of 39% year on year. The
Bank’s listed shares holdings stood at Rs. 10.0 billion at Dec’21 (Dec’20: Rs. 10.4 billion), capital gains
were realized on scrips where profitable opportunities emerged during the year.

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Within UBL International, liquidity is primarily deployed across sovereign debt instruments, with the
overall net portfolio standing at USD 643 million at Dec’21 (Dec’20: USD 771 million). During the
year, the Bank proactively booked substantial capital gains as well as ensuring reinvestments at
strong yields to support interest accruals.
Capital Ratios
The Bank seeks to maintain strong levels of capitalization to build resilience and maintain adequate
buffers over regulatory requirements. UBL had earlier been designated a Domestic Systemically
Important Bank (D-SIB) by the State Bank of Pakistan (SBP). This designation initially required the
Bank to hold an additional 1.5% Higher Loss Absorbency (HLA) capital surcharge, over and above the
applicable minimum capital adequacy ratio (CAR) limit in 2019, on both a standalone and
consolidated basis. However, SBP reduced the HLA surcharge by 50 bps to 1.0% effective March
2020.
In the latest assessment carried out by the SBP in October 2021, UBL is no longer a D-SIB. However,
the Bank shall continue to meet the higher HLA capital surcharge, in the form of Additional Common
Equity Tier 1 (CET-1) capital of 1.00% on a standalone and consolidated basis till June 30, 2022.
The SBP has also provided regulatory relief for COVID-19 to support the banking sector in extending
credit facilities to its customers. In this respect, SBP has reduced the Capital Conservation Buffer
(CCB) from its existing level of 2.5% to 1.5%, for the time being till further instructions are issued.
Thus, the minimum CAR requirement for UBL stood at 12.5% (including the HLA Surcharge of 1.0%)
as at December 31, 2021.
The Bank’s overall CAR stood at 21.5% at Dec’21 (Dec’20: 24.4%), maintaining a buffer of 9.0% over
the minimum regulatory requirement of 12.5%. The CET-1 ratio stood at 15.1% at Dec’21 (Dec’20:
17.0%). Total Tier 1 Capital ratio was measured at 16.3% at Dec’21 (Dec’20: 18.4%).
The Board of Directors of UBL declared a final dividend of 60% (Rs. 6.0 per share) in their meeting in
Islamabad held on February 23, 2022, along with the results for the year ended December 31, 2021.
Economy Review
The country’s economy gathered significant momentum in the latter half of 2021 with strong pick up
in overall domestic demand. However, global increase in the price levels for food, energy and other
key commodities, with a weaker PKR has caused significant rise in domestic inflation. This poses the
strongest challenge to an otherwise nascent recovery with economic activity now returning to pre
COVID levels.
High level of imports exerted significant pressures on the external front as the country recorded a
current account deficit (CAD) of USD 9.1 billion for the H1 FY’22 as against a surplus of USD 1.2 billion
UNITED BANK LIMITED
for the corresponding period of last year. The country’s balance of trade recorded a deficit of USD
28.8 billion for 7M FY’22, a significant increase of 92%. The country’s imports stood at USD 46.5
billion for 7M FY’22 as against USD 29.3 billion last year, recording an increase of 59%. The country’s
exports have been picking up in recent months, recorded at USD 17.7 billion for 7M FY’22, growing
by 24%, mainly on the back of high value added textiles, as well as food and other manufactured
goods. The contribution of home remittances continues to be significant as inflows of USD 18.0
billion were recorded for 7M FY’22, an increase of 9% over the corresponding period of last year.
Looking ahead, the balance of payment position is expected to gain some stability with inflows from
the IMF, other multilateral organizations, and Sukuk issuance of USD 1.0 billion.
On the inflation front, CPI was measured at 13.0% for Jan’22 (Dec’21: 12.3%, Dec’20: 8.0%), one of
the highest levels in recent history. Average inflation for 7M FY’22 was measured at 10.3% versus
8.2% in the previous period. In order to counter the effects of inflationary pressures as well as
ensuring that the recent growth remains sustainable, the SBP increased the policy rate to 9.75% in its
Monetary Policy Statement on December 14, 2021, a cumulative increase of 275 bps since Sep’21.
However, in view of the anticipated impact of monetary and fiscal policy measures with respect to
the current account, better GDP growth and improvement in the medium term inflation outlook, SBP
in its recent Monetary Policy Statement on January 24, 2022 has maintained a status quo at 9.75%.
The country’s FX markets remained volatile for much of the year, as the exchange rate closed at Rs.
176.5 / USD at Dec’21, depreciating by 10.4% since Dec’20, given the market determined exchange
rate regime. However, the currency has recovered since the year end and is currently near the Rs
174.5 mark, as pressures on the external front are expected to ease in the medium term. The KSE-
100 index, after touching a high of 48,726 points in June 2021, remained largely range bound this
year, closing at 44,596 point as at Dec’21.
Banking sector deposits stood at Rs. 21.0 trillion at Dec’21, a strong growth of 17% over Dec’20.
Sector advances were recorded at Rs. 10.1 trillion at Dec’21, growing by a significant 19% over
Dec’20. Non-performing loans for the banking industry stood at Rs. 877 billion at Sep’21, increasing
by 6% over Dec’20, while asset quality levels improved from 9.2% at Dec’20 to 8.8% at Sep’21.
UBL International
The economic environment within the GCC has started to pick up momentum as the pandemic
gradually recedes along with a significant rise in oil prices. The recovery is also aided by mass
vaccinations programs rolled out across the GCC as well as easing of travel and other restrictive
measures.
International lending also remained in a consolidation phase during early half of 2021 owing to
ongoing COVID-19 pandemic which had exacerbated the issues being faced by the region i.e. low oil
UNITED BANK LIMITED
prices and elongated receivables cycle. The economic growth in the GCC which had suffered in 2020
affecting businesses and ultimately the banking sector showed signs of improvement in 2021. With
mass vaccination drives across GCC, stabilizing oil prices, lifting of Qatar embargo as well as the Dubai
Expo 2020. Based on the same, selective lending to reputable clients against well collateralized
structures being pursued cautiously.
Within International, UBL’s strategy is to continue to build a profitable, sustainable business model,
driven by a stable base of low cost deposits. On the asset side, the Bank is looking to expand its book
selectively, with rigorous oversight to minimize the risk of NPL formation. Excess liquidity is primarily
deployed in stable, sovereign debt securities with an aim to maintain healthy net interest margins.
After significant de-risking and stabilization of operations over the last few years, UBL International
recorded a PBT of USD 38.7 million for the year 2021 as against a loss before tax of USD 62.6 million
in 2020. Gross revenues for the International business were recorded at USD 78 million, growing by
20% over last year. Net markup income was recorded at USD 49 million in 2021, growing by 3% over
last year. Non markup income of USD 29 million was earned in 2021 as against USD 17 million earned
last year, primarily due to realization of capital gains on foreign debt securities. Operating expenses
for the International business were well controlled, recording a decline of 8% year on year, after a
restructuring to a leaner and more efficient operating model in early 2021. As a result of strong
oversight and an aggressive focus on recoveries, net provisioning expense was reduced from USD 92
million in 2020 to USD 6 million in 2021.
The deposits base averaged USD 1.3 billion in 2021, declining by 10% year on year, while the cost of
deposits improved from 1.6% in 2020 to 1.1% in 2021. The average performing loan book was largely
maintained at USD 658 million in 2021. The investment book averaged USD 718 million in 2021
earning the Bank a healthy yield of 5.6%.
Subsidiaries Performance Overview
Highlights of the financial performance of our subsidiaries in 2021 is as follows: -

United National Bank Limited (UBL UK) is a 55% owned subsidiary of UBL. In 2021, UBL UK posted a
PBT of £ 2.1 million (2020: net loss before tax of £ 1.9 million). The Bank’s net markup income grew
by 40% year on year. Non markup income witnessed an 87% decline over last year. Fee income was
down 28% year on year, largely due to the pandemic led slowdown. Administrative expenses
increased by 10% year on year. UBL UK recorded £ 2.1 million provision reversals as against a net
provision charge of £ 2.3 million in 2020. The Bank’s net investments portfolio declined by 38%, while
net advances grew by 36%. On the funding side, the overall deposits base expanded by 11% over
Dec’20.

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UBL Switzerland AG is a wholly owned subsidiary of UBL. The shareholders of the UBL resolved to
voluntarily wind up UBL Switzerland AG in the Extra Ordinary General Meeting (EOGM) of
shareholders held on August 6, 2021. This decision is in line with the Bank’s strategy to exit from
non-core markets. The winding up is subject to fulfilment of relevant legal and regulatory
requirements both in Pakistan and Switzerland.
Due to closure of business operations, UBL Switzerland recorded a loss before tax of CHF 438 k in
2021 as against a PBT of CHF 1.1 million in 2020. Net markup income stood lower by 56% over the
previous year, while non mark-up income declined by 25%. Income from fees and commissions
declined by 25% year on year. The balance sheet size reduced by 72% over Dec’20.
UBL Fund Managers Limited, Pakistan (UBLFM) is a 98.9% owned subsidiary of UBL. UBLFM recorded
a PBT of Rs. 564 million in 2021, a strong growth of 32% year on year. The funds under management
of UBLFM stood at Rs. 116 billion at the close of 2021 (2020: Rs. 90 billion).
UBL Bank (Tanzania) Limited (UBTL) was established in 2012 and is a wholly owned subsidiary of UBL.
UBTL entered into an asset and liabilities purchase agreement with EXIM Bank Tanzania Limited
(EXIM) on 22 May 2019. EXIM took over control of UBTL’s assets and liabilities on November 1,
2019. UBTL has ceased its banking operations and is in the process of winding up and voluntary
liquidation (refer to note 8.12 to the financial statements).
United Executors and Trustees Company Limited, Pakistan (UET) was incorporated in Pakistan in 1965
as an unlisted public limited Company and was a wholly owned subsidiary of the Bank. UET has been
voluntarily wound up on December 28, 2021 (refer to note 8.11 to the financial statements).
Credit Rating
VIS Credit Rating Company Limited (VIS) re-affirmed the entity ratings of UBL at ‘‘AAA / A-1+” (Triple
A / A-One Plus) on June 30, 2021. Furthermore, UBL’s Additional Tier-1 (ADT-1) TFC has also been
reaffirmed at ‘AA+’ (Double A plus). Outlook on the assigned ratings are ‘Stable’.
Awards and Recognition
UBL was awarded the “Best Mobile App” and “Best Emerging Technology” awards at the prestigious
Pakistan Digital Awards 2021. The award recognizes outstanding innovation and creativity of the best
digital professionals and companies from across the country.
Future Outlook
UBL shall continue to play a prominent role in the economic recovery of the country as we constantly
strive to ensure availability of banking services across all channels. The domestic business remains

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the cornerstone of the UBL franchise, led by the Branch Banking Group, which aims to expand its
ever growing customer base through leveraging one of the largest branch networks in the country.
UBL remains one of the leaders in the digital banking space and we will continue to invest in and
develop innovative and technologically superior solutions. Strengthening compliance and control
standards in line with international best practices is an ongoing initiative where we remain fully
committed as an organization. After undergoing a period of consolidation, our International business
stands ready to make strong contribution to the bottom line and serves as a unique diversification
avenue to the Domestic Bank. We are fully committed to set the benchmark for the Environment,
Social and Governance (ESG) standards in Pakistan which are the key to building a stronger franchise
that has a wider and more positive impact on the markets where we operate.
Corporate Governance
Directors’ statement
The Board of Directors is committed to ensuring that the requirements of corporate governance set
by the Securities and Exchange Commission of Pakistan are fully met. The Bank has adopted good
corporate governance practices and the Directors are pleased to report that:
 The financial statements, prepared by the management of the Bank, present fairly the state
of affairs of the Bank, the results of its operations, cash flows and changes in equity.
 Proper books of accounts of the Bank have been maintained.

 Appropriate accounting policies have been consistently applied in the preparation of the
financial statements. Accounting estimates are based on reasonable and prudent judgment.
 International Financial Reporting Standards, as applicable to banks in Pakistan, have been
followed in preparation of financial statements without any departure therefrom.
 The system of internal control in the Bank is sound in design and is effectively implemented
and monitored.
 There are no significant doubts regarding the Bank’s ability to continue as a going concern.
 There has been no material departure from the best practices of corporate governance.
 Performance highlights for the last six years are attached to these unconsolidated financial
statements.
 Profit amounting to Rs. 3.1 billion has been transferred to Statutory Reserve for the year
2021.
Directors’ Report FY 2021 P a g e | 10

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 The Board of Directors consists of eight (8) male and one (1) female member. The detailed
composition of the Board is given in paragraphs 1 and 2 of the Statement of Compliance with
the Code of Corporate Governance.
 A fair mechanism is being followed by BOD for the performance evaluation of individual
directors, including the Chairman & President, overall Board and its committees.
Performance evaluation is conducted annually whereas the same is undertaken by an
external independent approved evaluator at least once in every three years.
 Details of Directors’ training programs are given in the Statement of Compliance with the
Code of Corporate Governance.
 The Non-Executive Directors, including Independent Directors, are eligible for fees and
logistic related expenses for attending meetings of the Board and its Committees, as
approved by the Shareholders.
 The Board has constituted the following five Committees with defined Terms of Reference
(ToRs):
Board Audit Committee (BAC):

Ms. Shazia Syed Chairperson
Mr. Haider Zameer Choudrey Member
Mr. Rizwan Pervez Member
Mr. Aqeel Ahmed Nasir Secretary
Board Risk and Compliance Committee (BRCC):
Mr. Arshad Ahmad Mir Chairman

Lord Zameer M. Choudrey, CBE, SI Pk Member
Ms. Shazia Syed Member
Mr. Shazad G. Dada Member
Mr. Imran Sarwar Secretary

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Board Human Resource & Compensation Committee (HRCC):
Mr. Tariq Rashid Chairman

Sir Mohammed Anwar Pervez, OBE, HPk Member
Mr. Arshad Ahmad Mir Member
Mr. Rizwan Pervez Member
Mr. Abdul Jabbar Junejo Secretary
Board IT Committee (BITC):
Mr. Tariq Rashid Chairman

Mr. Haider Zameer Choudrey Member
Mr. Shazad G. Dada Member
Mr. Muhammad Faisal Anwar Secretary
Board Nomination Committee (BNC):
Sir Mohammed Anwar Pervez, OBE, HPk Chairman

Mr. Arshad Ahmad Mir Member
Mr. Aqeel Ahmed Nasir Secretary
A brief description of the core functions under the ToRs of each sub-committee are as follows: -
Board Audit Committee (BAC): - The primary activity of the board audit committee is to provide
oversight of the financial reporting process, the audit process as well as the system of internal
controls and compliance with laws and regulations. The committee reviews the results of audits with
the Bank’s management as well as the external auditors. The committee also reviews the scope and
extent of internal audit, audit plan, reporting framework and procedures and ensures that the
internal audit function has adequate resources and is appropriately placed within the Bank. The
committee also provides oversight and review of the internal control over financial reporting (ICFR)
system for effective implementation and its upgrade.
Board Risk and Compliance Committee (BRCC): - The committee is responsible for setting the overall
risk management framework and ensuring the evolution and effectiveness of all risk management
policies in line with the changing economic climate for risk mitigation. The committee ensures

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compliance with various risk management policies, monitoring of operational risk, Basel, treasury
and market risk, credit risk and credit policy functions. Furthermore, the committee also monitors
the effectiveness of the risk management function to ensure compliance with regulatory risk
requirements including effective safeguards against financial crimes.
Board Human Resource & Compensation Committee (HRCC): - The committee is responsible for
recommending to the Board the overall remuneration mechanism and policy across the Bank and
ensuring that the policies are aligned with regulatory requirements. The purview of the committee
includes the review of the overall compensation and benefit structure, including Material Risk Takers
(MRTs) and Material Risk Controllers (MRCs), headcount levels, as well as recommending human
resource management policies to the Board. The committee is also responsible for recommending to
the Board a policy framework for determining remuneration of directors, executive and non-
executive directors, and members of senior management in accordance with relevant prevailing
regulatory guidelines.
Board IT Committee (BITC): - The Committee is responsible for providing an effective governance
framework to ensure that the Bank’s technology function enables the achievement of corporate
strategies and objectives. The Committee communicates to the Board the progress of the technology
activities and digital initiatives being undertaken across the Bank. Furthermore, the Committee is
also responsible for ensuring that risk management strategies are designed and implemented to
effectively respond to wide-scale disruptions, as well as managing Information Technology (IT) and
Cyber Security Risks.
Board Nomination Committee (BNC): - The primary responsibility for the Committee is to is to review
the nomination of directors, including their profile, academic background, skills, knowledge and
experience. The Committee is responsible for reviewing the overall structure, size and composition
of the Board and its committees and to make recommendations to the Board in this regard. The
Committee also makes recommendations for filling casual vacancies on the board and board sub-
committees and monitor the annual board evaluation process as per regulatory requirements.
Directors appointment and nomination
The directors of the Bank are elected by the shareholders while casual vacancies are filled by the
directors in accordance with the articles of association and the applicable laws and regulations.
Furthermore, every new director has to pass through the assessment criteria of ‘Fit and Proper Test’
as set and advised by the State Bank of Pakistan.
While appointing a director, it is ensured that the Board is well structured comprising of members
who have diversified experience, suitable knowledge, appropriate skill set, expertise and competency
UNITED BANK LIMITED
related to the Bank's operations, creating an effective decision-making body. It is also ensured that
the Board contains appropriate mix of non-executive, independent and female members that meet
all the requirements of the applicable laws and regulations regarding diversity, size of the board and
have no material conflicts of interest.
Active role of Independent Directors is ensured to enhance the overall effectiveness of the Board.
While selecting and appointing independent directors, the applicable provisions of the laws, rules
and regulations are meticulously complied with. Independent Directors are selected to demonstrate
the transparency and fairness in their role and also to provide an objective and independent
judgment in the best interest of the Bank.
The profiles of each director, including their qualification, expertise, past work experience along with
their status as well as their membership on board(s) / Shariah Board(s) of other companies is
included in the directors’ profile in the Annual Report.
Board Performance Evaluation
To comply with the requirement of SBP’s BPRD Circular No. 11 dated August 22, 2016, and the
Corporate Governance Regulatory Framework a formal process of evaluation of performance of the
Board as a whole and its committees has been framed and implemented according to the prevailing
regulatory instructions.
Compensation of Directors
In light of the guidelines issued by SBP in the BPRD Circular No. 03 dated August 17, 2019, the Board
approved the Directors’ Remuneration Policy in its meeting held on February 19, 2020. Under this
policy, non-executive directors, including the Chairman will be eligible to receive an amount of Rs.
750,000 per Board meeting and Rs. 750,000 for attending a committee meeting of the Board. In
addition to the meeting fees, the Chairman will be entitled to a remuneration up to 20% of the Board
meeting fee for holding the office of the Chairman. The policy also covers traveling, logistics and
accommodation expenses as well as daily allowance entitlements. This policy has been approved by
the shareholders of the Bank in the AGM held on March 25, 2020.
The details of compensation of directors in 2021 are disclosed in Note 39 to the unconsolidated
financial statements.

UNITED BANK LIMITED
Meetings of Board Committees
The number of Board Committees’ meetings held during the year and the number of meetings
attended by the directors is shown below:
BAC BRCC HRCC BITC BNC

Number of meetings held 5 4 4 4 1
Number of meetings attended: 5 4 4 4 1
Sir Mohammed Anwar Pervez, OBE, HPk - - 4 - 1
Lord Zameer M. Choudrey, CBE, SI Pk - 4 - 4 1
Mr. Haider Zameer Choudrey 5 - - 4 -
Mr. Rizwan Pervez 5 - 4 - -
Mr. Arshad Ahmad Mir - 4 4 - 1
Mr. Amar Zafar Khan - - - - -
Mr. Tariq Rashid - - 4 4 -
Ms. Shazia Syed 5 4 - - -
Mr. Shazad G. Dada - 4 - 4 -
The Bank operates five funded retirement schemes which are the Provident Fund, Gratuity Fund,
Pension Fund, Benevolent Fund and General Provident Fund.
The values of the investments of these funds, based on their latest audited financial statements as at
December 31, 2020 are as follows:
Rupees in ‘000
Employees’ Provident Fund 4,561,652
Employees’ Gratuity Fund 909,272
Staff Pension Fund 10,259,855
Staff General Provident Fund 815,256
Officers / Non-Officers’ Benevolent Fund 302,702
Meetings of the Board
During the year under review, the Board of Directors met five (5) times. The number of meetings
attended by each Director during the year is shown below:

UNITED BANK LIMITED
Name of the Director Designation Meetings attended
Sir Mohammed Anwar Pervez, OBE, HPk Chairman 5
Lord Zameer M. Choudrey, CBE, SI Pk Director 5
Mr. Haider Zameer Choudrey Director 5
Mr. Rizwan Pervez Director 5
Mr. Arshad Ahmad Mir Director 5
Mr. Amar Zafar Khan Director 5
Mr. Tariq Rashid Director 5
Ms. Shazia Syed Director 5
Mr. Shazad G. Dada President & CEO 5
Pattern of Shareholding
The pattern of shareholding as at December 31, 2021 is given below:
% of Ordinary
Shareholders No. of Shares
Shares
Bestway Group (BG) 752,569,602 61.48%
General Public & Others 367,080,599 29.99%
Banks, DFIs & NBFIs 27,391,798 2.24%
Insurance Companies 35,523,909 2.90%
Modarabas & Mutual Funds 40,642,954 3.32%
International GDRs (non-voting shares) 969,111 0.07%
Privatization Commission of Pakistan 1,714 0.00%
TOTAL OUTSTANDING SHARES 1,224,179,687 100.00%

UNITED BANK LIMITED
The aggregate shares held by the following are:
No. of shares
a) Associated Companies, undertakings & related parties
- Bestway International Holdings Limited * 631,728,895
- Bestway Cement Limited 93,649,744
b) Modarabas & Mutual Funds ** 40,642,954
c) Directors & CEO ***
- Sir Mohammed Anwar Pervez, OBE, HPk 12,765,368
- Lord Zameer M. Choudrey, CBE, SI PK 2,403,870
- Mr. Haider Zameer Choudrey 2,000,000
- Mr. Rizwan Pervez 129,500
- Mr. Arshad Ahmad Mir 2,500
- Mr. Amar Zafar Khan 2,500
- Mr. Tariq Rashid 2,500
- Ms. Shazia Syed 2,500
d) Executives 666,782
e) Public sector companies and corporations 118,628
f) Banks, DFIs, NBFIs, Insurance Companies 62,915,707
* The Bank is a subsidiary of Bestway International Holdings Limited which is incorporated in the
Guernsey.
** Name wise detail of Modarabas & Mutual Funds is annexed with Categories of Shareholders
*** There were no shares held by the spouses or minor children of the Directors and CEO of the Bank
Shareholders holding 5% or
No. of shares %
more voting rights
Bestway International Holdings
631,728,895 51.60
Limited
Bestway Cement Limited 93,649,744 7.65
Trades in the shares of UBL carried out by Directors, Executives and their spouses and minor children
are annexed along with the Pattern of Shareholding.

UNITED BANK LIMITED
Shariah Board
The details relating to Shariah board and its members as required to be disclosed in the Director’s
Report are covered in the ‘Report of Shariah Board’ as part of the Annual Report.
Remuneration Framework
In compliance with regulatory guidelines, UBL has put in a place a comprehensive remuneration
policy to ensure that the Bank’s remuneration practices attract, retain and reward the best talent,
are in compliance with regulatory guidelines and are aligned with the Bank’s overall strategic
objectives. One of the key features of the remuneration framework is to promote effective risk
management in line with the Bank’s risk appetite and within the thresholds set by the Bank.
UBL’s Board of Directors has the overall responsibility for reviewing, approving and monitoring the
implementation of the remuneration framework, based on recommendations of Board Human
Resource and Compensation Committee (HRCC).
The Bank offers a remuneration structure comprising of both fixed and variable elements.
Some of the key features of the remuneration structure are as follows: -
Fixed remuneration: This comprises of the base salary, including any annual increments, and role-
based fixed allowances, if applicable. Fixed remuneration does not vary with performance and is
payable in cash.
Variable performance based remuneration: These are determined based on the Bank’s overall
performance, profitability of the respective business unit and the employee’s individual
performance. Such remuneration takes the form of annual or periodic bonuses and sales incentives.
Other Benefits: These are awarded on the basis of individual employment contracts and local market
practices. These may include staff loans, expense allowances / reimbursements, life insurance,
medical care and relocation allowances amongst others.
Sign-on / Joining Bonus: This is considered as part of variable pay and is granted only in exceptional
cases in accordance with human resources policies and is payable within twelve months from joining
the Bank.
Severance pay: These are part of an employee’s variable pay and includes any payment made to
employees at the time of their retirement, separation or termination of contract over and above
their normal retirement, separation or termination benefits.

UNITED BANK LIMITED
Material Risk Takers (MRTs) and Material Risk Controllers (MRCs)
The criteria for an employee to be designated as an MRT / MRC has been developed in accordance
with regulatory guidelines and best practices. MRTs and MRCs are identified as functions and
designations having appropriate level of authority and control within the Bank. MRCs have
appropriate level of authority and control and are duly governed by approved organograms having
clearly defined independent reporting lines.
MRTs and MRCs include employees and designations entailing; President and CEO, members of
management teams reporting directly to the President and CEO, members of critical management
committees, heads of critical functions responsible for managing businesses, risks and controls,
country heads of overseas branches. MRTs and MRCs also include employees taking decisions, which
may affect the Bank’s exposure to credit risk, market risk, operational risk and liquidity risk based on
appropriate materiality levels.
MRT and MRC performance is measured using risk-adjusted balanced scorecards, ensuring
correlation and alignment of risks and rewards, incorporating various financial and non-financial,
qualitative as well as ‘risk-adjusting’ factors. Each category within the scorecard includes multiple
factors and KPIs which is assessed based on appropriate benchmarks and targets. Ratings are
assigned to MRTs and MRCs based on this risk-adjusted performance assessment. These scorecards
are reviewed every year, with interim reviews carried out in case of any significant changes in
underlying circumstances.
Remuneration of MRTs and MRCs
The compensation structures for MRTs and MRCs is determined and proposed by the Human
Resources department which ensures an appropriate balance between fixed and variable pay,
considering the employees position, roles and responsibilities, as well as performance against
financial and non-financial objectives and KPIs. The compensation for MRTs and MRCs includes fixed
and variable elements similar in structure to the Banks’ remuneration policy for all employees.
Fixed remuneration comprises of base salary, increments and role-based fixed allowances if
applicable. The Human Resources department drives an appropriate benchmark using external
market data, in order to ensure the appropriateness of the fixed remuneration to attract and retain
employees.
Variable remuneration is performance based, similar to the Bank’s other employees.
The employee score can be adjusted downwards for elements of underachievement in financial
performance, undue risk exposure, customer related issues, audit / internal controls and compliance
ineffectiveness.
UNITED BANK LIMITED
Deferral Mechanism
A certain portion of the MRTs and MRCs variable compensation will be withheld for a defined period
whereas remaining portion of the variable compensation shall be paid up-front. This is aimed at
aligning the employees’ and stakeholders’ interests and reinforcing that compensation is
appropriately linked to longer-term sustainable performance. The deferral percentage ranges
between 25% to 40%, while the deferral period for all MRTs and MRCs will be three years, and will be
paid on vesting, proportionally through yearly installments, during the deferred period.
Risk Management Framework
UBL’s Risk and Credit Policy Group has the following verticals:
 Corporate, Commercial, SME and Financial Institutions Risk
 International Risk
 Consumer Credit
 Enterprise Risk
 Market and Treasury Risk, and Basel
 Operational Risk
 Vendor Management
 Information Security
 Credit Policy and Research
The Bank’s risk governance is exercised the following committees:
1. Operational & Risk Management Committee
2. Portfolio Review Committee
3. Information Security Steering Committee
4. NPL Review Committee International
Operational and Risk Management Committee is chaired by the President and CEO and comprises of
Heads of Risk, Businesses, Finance, Treasury and Operations. Other stakeholders are invited to
attend as deemed necessary. The ORMC is responsible for reviewing and undertaking strategic
business decisions with a collective view on credit risk and credit maintenance, market risk and
capital efficiencies and operational risk.
The Portfolio Review Committee reviews the overall portfolio of problem credits (Watch-listed and
NPL credits) with a focus to formulate action plans and remedial strategies. The PRC Review
UNITED BANK LIMITED
Committee is chaired by the President and CEO, Chief Risk Officer, Heads of Credit Risk of business
segments, Head of Business segments, Chief Financial Officer, Credit Administration and the Special
Asset Management Group. Other stakeholders are invited to attend as deemed necessary.
The Information Security Steering Committee is chaired by the President and CEO and comprises
Heads of all Groups. The Committee is responsible for reviewing and undertaking strategic
information and cyber security related reviews.
The NPL Review Committee International is chaired by the President and CEO and comprises of Risk
and Business leadership for the International Group. The Committee reviews and monitors the NPL
and the watch-list portfolio of GCC and focuses on formulation of action plan for recovery.
The consumer credit portfolio has continued to sustain its steady growth under a well-managed risk
environment. The controlled level of portfolio delinquencies is owed to robust portfolio management
for NPLs including but not limited to stress tests. Periodic review of policies along with automation in
risk management procedures ensured a well aligned risk and reward profile of the portfolio.
In line with the SBP Risk Governance Framework for Overseas Operations, the risk management
function for International division is being managed from Head Office. During the year, several
initiatives such as de-risking of high RWA assets, focus on cost efficiencies, proactive portfolio
management, mapping of policies with domestic structure as well as gap analysis of local regulatory
guidelines continued. were undertaken.
The role of Market Risk includes defining and implementing a market risk management framework to
systematically identify, assess, monitor and report market related risks. The key objective is to
facilitates business growth within a controlled and transparent overall risk management framework.
The objective of the Bank’s liquidity risk management framework is to ensure that the Bank is able to
fulfill its payment obligations at all times and manages its liquidity risk within the defined tolerance
level. The framework entails a comprehensive liquidity risk policy and well defined procedures along
with an effective contingency funding plan.
The Bank at all times has maintained its Capital Adequacy Ratio (CAR) well above the regulatory
thresholds under the prescribed Basel-III regulations, inclusive of all applicable buffers. The Internal
Capital Adequacy Assessment Process (ICAAP) Framework is well defined and is reviewed on an
annual basis.

UNITED BANK LIMITED
The Operational Risk Management Framework is designed to ensure that an adequate control
environment exists across its businesses and functions to maintain an acceptable level of residual
risk. The framework is governed by comprehensive policies and procedures in line with the
applicable regulatory guidelines. The Bank has implemented a robust operational risk management
system to further strengthen the framework.
UBL has a dedicated Information Security Division, functioning within Risk and Credit Policy Group
who manages information security risks to protect the technology and information assets by
preventing, detecting and responding to threats, both internal and external.
Offensive security unit in the information security division manage penetration testing by simulating
the real world hacking scenarios. The unit is responsible for establishing, implementing, maintaining
and continually improving an information / cyber security management system through control
design and controls validation, primarily in the domain of applications/network Penetration testing
The unit also supports other domains of information security including security monitoring and
threat hunting. Moreover, in order to overcome social engineering frauds, extensive awareness
campaigns are periodically launched to provide specific training and guidance on information
security related matters such as phishing, identity theft, online transaction frauds, etc. through
various mechanisms such as social media, website, email advisories, SMS, webinars, phishing
simulation exercises, new joiner’s orientation, and targeted awareness sessions for executive
leaderships. These initiatives are focused on elevating the level of awareness for both internal as well
as external customers to better equip them in order to counter security challenges under the
Governance, Risk & Compliance unit.
The Bank manages the overall security compliance efforts, risk management as well as development
and implementation of information security policies, procedures, guidelines and standards under this
domain.
Moving ahead, Bank’s main focus is the continuous Improvement of UBL’s Security Posture and
Effectively Prevent, Monitor and Rapidly Respond to Emerging Threats and Vulnerabilities.
Sustainability at UBL in 2021
UBL’s sustainability agenda is based on supporting causes that influence and enable communities in a
positive manner. In 2021, UBL donated to various projects across the education and healthcare
sectors, being the Bank’s core areas for sustainability efforts. The various projects involved
scholarships to deserving students, infrastructural support for construction of schools and hospitals
and funds to assist patients in receiving subsidized or free-of-cost, quality healthcare. The Bank

UNITED BANK LIMITED
encouraged employee engagement in some of the projects and the UBL team actively volunteered
and played their part as symbols of hope for their communities across Pakistan.
Statement of Internal Controls
The Board is pleased to endorse the statement made by the management relating to Internal
Controls over Financial Reporting (ICFR) and also the overall internal controls. The Statement on
Internal Controls is included in the Annual Report.
Auditors
The present auditor, M/S. A. F. Ferguson & Co., Chartered Accountants retire after the expiration of
their term which included an extension under a special approval received from the SBP.
The Board of Directors and the Board Audit Committee recommend the appointment of M/S EY Ford
Rhodes as the external auditors for the financial year 2022 at a fee of Rs. 10.6 million, while out of
pocket expenses and taxes would be paid on actuals.
Conclusion
In the end, we would like to extend our sincere thanks and appreciation to UBL’s shareholders and
customers for their continued trust and support. We greatly appreciate the tireless efforts of our
staff who continue to ensure uninterrupted service to our customers. We would also like to extend
our sincere thanks to the Government of Pakistan, the State Bank of Pakistan, the Securities and
Exchange Commission and other regulatory bodies for their guidance and continued support.
For and on behalf of the Board,
Shazad G. Dada Arshad Ahmad Mir

President & CEO Director
Islamabad,
February 23, 2022

UNCONSOLIDATED STATEMENT OF FINANCIAL POSITION
AS AT DECEMBER 31, 2021
Note 2021 2020

--------------------------------- (Rupees in '000) -----------------------
ASSETS
Cash and balances with treasury banks 5 267,937,282 250,838,052
Balances with other banks 6 23,363,057 13,888,765
Lendings to financial institutions 7 51,701,076 19,959,132
Investments 8 1,496,542,453 1,128,674,494
Advances 9 646,188,457 530,279,496
Fixed assets 10 68,537,653 51,207,703
Intangible assets 11 2,231,265 1,829,211
Deferred tax assets 12 7,204,275 6,399,267
Other assets 13 54,460,389 46,315,560
2,618,165,907 2,049,391,680
LIABILITIES
Bills payable 15 26,792,970 29,733,813
Borrowings 16 563,284,750 128,987,415
Deposits and other accounts 17 1,750,943,765 1,640,211,901
Liabilities against assets subject to finance lease - -
Subordinated debt 18 10,000,000 10,000,000
Deferred tax liabilities 12 - -
Other liabilities 19 62,501,875 56,385,644
2,413,523,360 1,865,318,773
NET ASSETS 204,642,547 184,072,907
REPRESENTED BY:
Share capital 20 12,241,797 12,241,797
Reserves 69,718,467 62,274,068
Surplus on revaluation of assets 21 38,056,329 27,640,579
Unappropriated profit 84,625,954 81,916,463
204,642,547 184,072,907
CONTINGENCIES AND COMMITMENTS 22
The annexed notes 1 to 49 and annexures I, II and III form an integral part of these unconsolidated financial statements.
Aameer Karachiwalla Shazad G. Dada Shazia Syed Arshad Ahmad Mir Sir Mohammed Anwar Pervez, OBE, HPk
Chief Financial Officer President & Director Director Chairman
Chief Executive Officer
UNCONSOLIDATED PROFIT AND LOSS ACCOUNT
FOR THE YEAR ENDED DECEMBER 31, 2021
Note 2021 2020
-------------- (Rupees in '000) --------------
Mark-up / return / interest earned 24 147,974,155 152,003,210

Mark-up / return / interest expensed 25 76,215,631 77,044,038
Net mark-up / interest income 71,758,524 74,959,172
Non mark-up / interest income

Fee and commission income 26 13,063,973 11,097,472
Dividend income 2,033,934 1,269,537
Foreign exchange income 3,991,545 3,684,585
Gain / (loss) from derivatives 21,549 (13,076)
Gain on securities - net 27 3,757,530 411,440
Other income 28 510,517 644,381
Total non mark-up / interest income 23,379,048 17,094,339
Total income 95,137,572 92,053,511
Non mark-up / interest expenses

Operating expenses 29 42,745,343 40,060,602
Workers' Welfare Fund 30 1,021,926 864,956
Other charges 31 198,557 167,335
Total non mark-up / interest expenses 43,965,826 41,092,893
Profit before provisions 51,171,746 50,960,618

(Reversals) / provisions and write-offs - net 32 (955,407) 16,768,148
Profit before taxation 52,127,153 34,192,470
Taxation 33 21,245,030 13,293,687
Profit after taxation 30,882,123 20,898,783
-------------- (Rupees) --------------
Earnings per share - basic and diluted 34 25.23 17.07
UNCONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
2021 2020
-------------- (Rupees in '000) --------------
Profit after taxation for the year 30,882,123 20,898,783
Other comprehensive income
Items that may be reclassified to profit and loss account in subsequent periods
Effect of translation of net investment in foreign branches 4,356,186 864,578

Movement in (deficit) / surplus on revaluation of investments - net of tax (4,695,932) 2,001,430
(339,746) 2,866,008
Items that will not be reclassified to profit and loss account in subsequent periods
Remeasurement gain / (loss) on defined benefit obligations - net of tax 1,184,032 (803,081)
Movement in surplus on revaluation of fixed assets - net of tax 15,153,819 403
Movement in surplus on revaluation of non-banking assets - net of tax 9,276 (921)
16,347,127 (803,599)
Total comprehensive income for the year 46,889,504 22,961,192
UNCONSOLIDATED STATEMENT OF CHANGES IN EQUITY
Capital Surplus / (deficit) on revaluation
reserve - Statutory Unappropriated
Share capital Non-banking Total
exchange reserve Investments Fixed assets profit
assets
translation
----------------------------------------------------------------------------------------------------- (Rupees in '000) ---------------------------------------------------------------------------------------------------
Balance as at January 01, 2020 12,241,797 26,143,887 33,175,725 653,502 25,152,570 31,071 71,670,331 169,068,883
Total comprehensive income for the
year ended December 31, 2020
Profit after taxation for the year ended
December 31, 2020 - - - - - - 20,898,783 20,898,783
Other comprehensive income - net of tax - 864,578 - 2,001,430 403 (921) (803,081) 2,062,409
Total comprehensive income for the year
ended December 31, 2020 - 864,578 - 2,001,430 403 (921) 20,095,702 22,961,192
Transfer from surplus on revaluation upon
disposal to unappropriated profit - net of tax - - - - (116,346) (29,237) 145,583 -
Transfer of incremental depreciation from revaluation
of fixed assets to unappropriated profit - net of tax - - - - (51,893) - 51,893 -
Transfer to statutory reserve - - 2,089,878 - - - (2,089,878) -
Transactions with owners, recorded
directly in equity
Final cash dividend - December 31, 2019 declared
subsequent to the year end at Rs. 4.0 per share - - - - - - (4,896,719) (4,896,719)
Interim cash dividend - March 31, 2020
declared at Rs. 2.5 per share - - - - - - (3,060,449) (3,060,449)
- - - - - - (7,957,168) (7,957,168)
Balance as at December 31, 2020 12,241,797 27,008,465 35,265,603 2,654,932 24,984,734 913 81,916,463 184,072,907
Total comprehensive income for the

year ended December 31, 2021
Profit after taxation for the year ended
December 31, 2021 - - - - - - 30,882,123 30,882,123
Other comprehensive income - net of tax - 4,356,186 - (4,695,932) 15,153,819 9,276 1,184,032 16,007,381
Total comprehensive income for the year
ended December 31, 2021 - 4,356,186 - (4,695,932) 15,153,819 9,276 32,066,155 46,889,504
Transfer from surplus on revaluation upon
disposal to unappropriated profit - net of tax - - - - (3,115) - 3,115 -
Transfer of incremental depreciation from revaluation
of fixed assets to unappropriated profit - net of tax - - - - (48,298) - 48,298 -
Transfer to statutory reserve - - 3,088,213 - - - (3,088,213) -
Transactions with owners, recorded
directly in equity
Final cash dividend - December 31, 2020 declared
subsequent to the year end at Rs. 9.5 per share - - - - - - (11,629,707) (11,629,707)
Interim cash dividend - March 31, 2021
Interim cash dividend - June 30, 2021
Interim cash dividend - September 30, 2021
- - - - - - (26,319,864) (26,319,864)
Balance as at December 31, 2021 12,241,797 31,364,651 38,353,816 (2,041,000) 40,087,140 10,189 84,625,954 204,642,547
UNCONSOLIDATED CASH FLOW STATEMENT
Note 2021 2020

-------------- (Rupees in '000) --------------
CASH FLOW FROM OPERATING ACTIVITIES
Less: Dividend income (2,033,934) (1,269,537)
50,093,219 32,922,933
Adjustments:
Depreciation on fixed assets 2,849,015 2,832,975
Depreciation on right-of-use assets 1,928,943 1,655,038
Amortisation 801,197 793,562
Workers' Welfare Fund - charge 1,021,926 864,956
Provision for retirement benefits 579,028 932,684
Provision for compensated absences 39,083 70,902
Provision against loans and advances - net 1,239,990 16,203,144
(Reversal) / provision against off balance sheet items (344,250) 431,749
(Reversal) / provision for diminution in value of investments - net (1,271,498) 341,551
Interest expense on lease liability against right-of-use assets 964,050 924,718
Gain on sale of operating fixed assets - net (32,655) (74,202)
Gain on wind-up of subsidiary (103,993) -
Bad debts written-off directly 42,643 77,094
Unrealised gain on revaluation of investments classified as held for trading (16,282) (228)
(Reversal) / provision against other assets (168,605) 154,855
Other provisions / write-offs 376,339 54,243
7,904,931 25,263,041
57,998,150 58,185,974
(Increase) / decrease in operating assets
Lendings to financial institutions (31,741,944) 223,986
Held for trading securities (71,843,041) 68,126,135
Advances (117,191,594) 89,274,483
Other assets (excluding advance taxation) (8,285,671) 21,789,754
(229,062,250) 179,414,358
Increase / (decrease) in operating liabilities
Bills payable (2,940,843) 6,807,217
Borrowings 434,297,335 (25,496,585)
Deposits and other accounts 110,731,864 173,148,440
Other liabilities 3,032,430 (14,113,034)
545,120,786 140,346,038
374,056,686 377,946,370
Payments on account of staff retirement benefits (1,824,003) (1,789,757)
Workers' Welfare Fund paid (200,000) -
Income taxes paid (18,955,328) (3,504,366)
Net cash flow generated from operating activities 353,077,355 372,652,247
CASH FLOW FROM INVESTING ACTIVITIES

Net investments in available for sale securities (180,081,666) (396,288,885)
Net investments in held to maturity securities (122,167,182) 42,750,618
Net investments in associates (216,640) -
Investment in fixed assets and intangible assets (4,574,813) (2,897,781)
Dividend income received 2,251,908 1,103,189
Proceeds realised on wind-up of subsidiary 134,093 -
Sale proceeds from disposal of fixed assets 66,467 264,578
Effect of translation of net investment in foreign branches 4,356,186 864,578
Net cash flow used in investing activities (300,231,647) (354,203,703)
CASH FLOW FROM FINANCING ACTIVITIES

Payment of lease liability against right-of-use assets (2,649,400) (2,174,025)
Dividends paid (23,622,786) (8,138,474)
Net cash flow used in financing activities (26,272,186) (10,312,499)
Increase in cash and cash equivalents 26,573,522 8,136,045

Cash and cash equivalents at the beginning of the year 264,726,817 256,590,772
Cash and cash equivalents at the end of the year 35 291,300,339 264,726,817
NOTES TO AND FORMING PART OF THE UNCONSOLIDATED FINANCIAL STATEMENTS
1. STATUS AND NATURE OF BUSINESS
United Bank Limited (the Bank) is a banking company incorporated in Pakistan and is engaged in commercial banking and
related services. The Bank's registered office and principal office are situated at UBL Building, Jinnah Avenue, Blue Area,
Islamabad and at UBL Head Office, I. I. Chundrigar Road, Karachi respectively. The Bank operates 1,341 (2020: 1,356)
branches inside Pakistan including 145 (2020: 100) Islamic Banking branches and 2 (2020: 2) branches in Export
Processing Zones. The Bank also operates 8 (2020: 14) branches outside Pakistan. The Bank is a subsidiary of Bestway
International Holdings Limited (BIHL) and BIHL is a wholly owned subsidiary of Bestway Group Limited (BGL) which is
incorporated in the Guernsey.
During the year, an internal reorganisation exercise was undertaken by the Bestway Group by virtue of which Bestway
(Holdings) Limited incorporated in the United Kingdom, has transferred its entire shareholding of 51.6 percent in the Bank
to a new Company Bestway International Holdings Limited on March 19, 2021. BIHL is a wholly owned subsidiary of the
newly incorporated Bestway Group Limited. Both BIHL and BGL have been incorporated in Guernsey.
The Bank's ordinary shares are listed on Pakistan Stock Exchange (PSX). Its Global Depository Receipts (GDRs) are on
the list of the UK Listing Authority and the London Stock Exchange Professional Securities Market. These GDRs are also
eligible for trading on the International Order Book System of the London Stock Exchange. Further, the GDRs constitute an
offering in the United States only to qualified institutional buyers in reliance on Rule 144A under the US Securities Act of
1933 and an offering outside the United States in reliance on Regulation S.
2. BASIS OF PRESENTATION
These unconsolidated financial statements have been prepared in conformity with the format of financial statements
prescribed by the State Bank of Pakistan (SBP) vide BSD Circular No. 02, dated January 25, 2018.
In accordance with the directives of the Federal Government regarding the shifting of the banking system to Islamic modes,
SBP has issued various circulars from time to time. Permissible forms of trade-related modes of financing includes
purchase of goods by banks from customers and immediate resale to them at appropriate profit in price on deferred
payment basis. The purchase and resale arising under these arrangements are not reflected in these unconsolidated
financial statements as such, but are restricted to the amount of facility actually utilised and the appropriate portion of profit
thereon.
Key financial figures of the Islamic Banking branches are disclosed in annexure II to these unconsolidated financial
statements.
2.1 STATEMENT OF COMPLIANCE
These unconsolidated financial statements have been prepared in accordance with the accounting and reporting standards
as applicable in Pakistan. The accounting and reporting standards comprise of:
- International Financial Reporting Standards (IFRS) issued by the International Accounting Standards Board (IASB) as
are notified under the Companies Act, 2017;
- Islamic Financial Accounting Standards (IFAS) issued by the Institute of Chartered Accountants of Pakistan as are
notified under the Companies Act, 2017;
- Provisions of and directives issued under the Banking Companies Ordinance, 1962 and the Companies Act, 2017; and
- Directives issued by the State Bank of Pakistan (SBP) and the Securities and Exchange Commission of Pakistan
(SECP).
Whenever the requirements of the Banking Companies Ordinance, 1962, the Companies Act, 2017 or the directives issued
by the SBP and the SECP differ with the requirements of IFRS or IFAS, the requirements of the Banking Companies
Ordinance, 1962, the Companies Act, 2017 and the said directives shall prevail.
6
The SBP, vide BSD Circular letter No. 10, dated August 26, 2002, has deferred the applicability of International Accounting
Standard 39, Financial Instruments: Recognition and Measurement and International Accounting Standard 40, Investment
Property for banking companies till further instructions. Moreover, SBP vide BPRD circular no. 4, dated February 25, 2015,
has deferred the applicability of Islamic Financial Accounting Standards (IFAS) 3, Profit and Loss Sharing on Deposits.
Further, according to the notification of the SECP issued vide SRO 411(I)/2008 dated April 28, 2008, IFRS 7, Financial
Instruments: Disclosures has not been made applicable for banks. Accordingly, the requirements of these standards have
not been considered in the preparation of these unconsolidated financial statements. However, investments have been
classified and valued in accordance with the requirements of various circulars issued by the SBP.
The SECP vide its notification SRO 633 (I)/2014 dated July 10, 2014, adopted IFRS 10 - Consolidated Financial
Statements effective from the periods starting from June 30, 2014. However, vide its notification SRO 56 (I)/2016 dated
January 28, 2016, it has been notified that the requirements of IFRS 10 and section 228 of the Companies Act, 2017 will
not be applicable with respect to the investment in mutual funds established under trust structure.
These unconsolidated financial statements represent the separate financial statements of the Bank. The consolidated
financial statements of the Bank and its subsidiaries are presented separately.
2.2 Standards, interpretations of and amendments to accounting and reporting standards that are effective in the
current year
There are certain amendments to existing accounting and reporting standards that have become applicable to the Bank for
accounting periods beginning on or after January 1, 2021. These are either considered to not be relevant or do not have
any significant impact and accordingly have not been detailed in these unconsolidated financial statements.
2.3 Standards, interpretations of and amendments to accounting and reporting standards that are not yet effective
IFRS 9 has been applicable in several overseas jurisdictions from January 1, 2018. Accordingly, the requirements of this
standard are incorporated in the Bank’s unconsolidated financial statements for the jurisdictions where IFRS 9 has been
adopted.
As per SBP’s BPRD Circular Letter no. 24 of 2021, IFRS 9 ‘Financial Instruments’ is applicable to banks in Pakistan
effective January 1, 2022. The aforementioned circular letter required banks to submit IFRS 9 compatible pro forma
financial statements for the year ended December 31, 2021 and perform parallel run of IFRS 9 on quarterly basis. Further,
it was stated that final instructions will be issued subsequently based on the results of parallel reporting of banks.
The Banks in Pakistan through the Pakistan Banks Association (PBA) have submitted their comments on instructions
issued for parallel reporting and requested that those are addressed in the final instructions to be issued. The matters
raised include retaining some relaxations given presently in the Prudential Regulations, prescription of macro-economic
variables, retaining local regulatory requirements pertaining to IFRS 9 related areas on overseas branches, impact on
Capital Adequacy Ratio (CAR), guidance on Significant Increase in Credit Risk (SICR) criteria, future tax impacts of any
reversals, recording of Expected Credit Loss (ECL) on Government securities denominated in local currency, including
further clarifications required in certain areas.
Due to the fact that final instructions have not yet been issued and there are a large number of reservations on the draft
instructions, the banks are collectively of the opinion that impact on initial application of IFRS 9 cannot be determined as at
December 31, 2021.
There are certain other new amendments that are mandatory for the Bank's accounting periods beginning on or after
January 1, 2022, but are considered not to be relevant or will not have any significant effect on the Bank's operations and
are, therefore, not detailed in these unconsolidated financial statements.
3. BASIS OF MEASUREMENT
3.1 Accounting convention
These unconsolidated financial statements have been prepared under the historical cost convention except for:
- Certain fixed assets and non-banking assets acquired in satisfaction of claims, which have been stated at revalued
amounts less accumulated depreciation.
- Investments classified as held-for-trading and available-for-sale which are measured at fair value.
- Certain derivative financial instruments have been stated at fair value.
- Net obligations in respect of defined benefit schemes are carried at their present values.
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3.2 Critical accounting estimates and judgments
The preparation of these unconsolidated financial statements in conformity with accounting and reporting standards as
applicable in Pakistan requires management to make judgments, estimates and assumptions that affect the reported
amounts of assets and liabilities and income and expenses. It also requires management to exercise judgment in the
application of its accounting policies. The estimates and assumptions are based on historical experience and various other
factors that are believed to be reasonable under the circumstances. These estimates and assumptions are reviewed on an
ongoing basis.
Significant accounting estimates and areas where judgments were made by management in the application of accounting
policies are as follows:
i) classification and valuation of investments (notes 4.3 and 8).

ii) provision against non-performing advances (notes 4.4 and 9.4).
iii) income taxes (notes 4.10 and 33).
iv) defined benefit plans (notes 4.12 and 37).
v) fair value of derivatives (note 4.17.2).
vi) valuation and depreciation of fixed assets (notes 4.5 and 10).
vii) valuation and amortisation of intangible assets (note 4.7 and 11).
viii) valuation of right-of-use assets and their related lease liability (notes 4.6 and 10).
ix) impairment (note 4.9).
x) valuation of non-banking assets acquired in satisfaction of claims (note 4.8).
Revisions to accounting estimates are recognised in the period in which the estimate is revised if the revision affects only
that period, or in the period of revision and future periods if the revision affects both current and future periods.
4. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The accounting policies adopted in the preparation of these unconsolidated financial statements are consistent with those
of the previous financial year.
4.1 Cash and cash equivalents
Cash and cash equivalents for the purpose of the cash flow statement consist of cash and balances with treasury banks
and balances with other banks.
4.2 Lendings to / borrowings from financial institutions
The Bank enters into transactions of purchase under resale agreements (reverse repos), sale under repurchase
agreements (repos) and other short term money market lendings to financial institutions at contracted rates for a specified
period of time. Further, other long term lendings to financial institutions are classified in advances. These are recorded as
under:
4.2.1 Purchase under resale agreements
Securities purchased under agreement to resell (reverse repo) are included in lendings to financial institutions. The
differential between the purchase price and the resale price is amortised over the period of the agreement and recorded as
income.
Securities held as collateral are not recognised in the unconsolidated financial statements, unless these are sold to third
parties, in which case the obligation to return them is recorded at fair value as a trading liability.
4.2.2 Sale under repurchase agreements
Securities sold subject to a repurchase agreement (repo) are retained in the unconsolidated financial statements as
investments and the counterparty liability is included in borrowings from financial institutions. The differential between the
sale price and the repurchase price is amortised over the period of the agreement and recorded as an expense.
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4.2.3 Bai Muajjal
Bai Muajjal transactions represent sales of Sukuks on a deferred payment basis and are shown in lendings to financial
institutions except for transactions undertaken directly with the Government of Pakistan which are disclosed as
investments. The difference between the deferred payment amount receivable and the carrying value at the time of sale is
accrued and recorded as income over the life of the transaction.
4.3 Investments
Investments of the Bank, other than investments in subsidiaries and associates, are classified into following categories:
Held for trading
These are securities which are either acquired for generating a profit from short-term fluctuations in market prices, interest
rate movements and dealer's margin, or are securities included in a portfolio in which a pattern of short term profit taking
exists.
Held to maturity
These are securities with fixed or determinable payments and fixed maturities, in respect of which the Bank has the positive
intent and ability to hold to maturity.
Available for sale
These are investments, other than those in subsidiaries and associates, that do not fall under the held for trading or held to
maturity categories.
4.3.1 Initial measurement
All “regular way” purchases and sales of investments are recognised on the trade date, i.e., the date that the Bank commits
to purchase or sell the investment. Regular way purchases or sales of investments require delivery within the time frame
generally established by regulation or convention in the market place.
Investments are initially recognised at fair value which, in the case of investments other than held for trading, includes
transaction costs associated with the investments. Transaction costs on investments held for trading are expensed as
incurred.
4.3.2 Subsequent measurement
Held for trading
These are measured at subsequent reporting dates at fair value. Gains and losses on re-measurement are included in the
profit and loss account.
Held to maturity
These are measured at amortised cost using the effective interest rate method, less any impairment loss recognised to
reflect irrecoverable amounts.
Available for sale
Quoted securities classified as available for sale investments are measured at subsequent reporting dates at fair value.
Any surplus or deficit arising thereon is kept in a separate account shown in the statement of financial position as part of
the equity and is taken to the profit and loss account when realised upon disposal or when the investment is considered to
be impaired.
Unquoted equity securities are valued at the lower of cost and break-up value. The break-up value of these securities is
calculated with reference to the net assets of the investee company as per the latest available audited financial statements.
A decline in the carrying value is charged to the profit and loss account. A subsequent increase in the carrying value, upto
the cost of the investment, is credited to the profit and loss account. Investments in other unquoted securities are valued at
cost less impairment, if any.
9
4.3.3 Investments in Subsidiaries and Associates
Investments in subsidiaries and associates are valued at cost less accumulated impairment losses, if any.
Gains and losses on disposal of investments in subsidiaries and associates are included in the profit and loss account.
4.4 Advances
Advances are stated net of specific and general provisions which are charged to the profit and loss account. Provision
against advances by the Bank's branches in Pakistan is determined on the basis of the Prudential Regulations and other
directives issued by the SBP. Provision against advances by the Bank's overseas branches are made in accordance with
the requirements of the regulatory authorities of the respective countries in which the overseas branches operate.
Advances are written off when there is no realistic prospect of recovery. The amount so written-off is a book entry and does
not necessarily prejudice the Bank's right of recovery against the customer.
4.4.1 Finance lease receivables
Leases, where the Bank transfers substantially all the risks and rewards incidental to ownership of an asset to the lessee
are classified as finance lease. A receivable is recognised at an amount equal to the present value of the minimum lease
payments including guaranteed residual value, if any. Finance lease receivables are included in advances.
4.4.2 Islamic financings and related assets
Receivables under Murabaha financing represent cost price plus an agreed profit on deferred sale arrangement. Profit
could be recognised on a straight line basis over the period of the instalments.
Ijarah financing represents arrangements whereby the Bank (being the owner of assets) transfers its usufruct to its
customers for an agreed period at an agreed consideration (rentals). Assets leased out under Ijarah are stated at cost less
accumulated depreciation and accumulated impairment losses, if any. These are depreciated over the term of the lease.
Ijarah income is recognised on an accrual basis.
Diminishing Musharakah is partnership agreement between the Bank and its customer for long term financing of assets.
The receivable is recorded to the extent of Bank's share in the purchase of asset. Income is recognised on accrual basis.
Istisna is a sale contract where the Bank places an order to the manufacturer / builders to produce certain assets and the
sale is completed upon the delivery of the assets to the ultimate buyer.
Running Musharakah facility is to finance the working capital requirement of the customer whereas partnership is based on
particular operations of the business.
4.5 Fixed assets
Property and equipment, other than land (which is not depreciated) and capital work-in-progress, are stated at cost or
revalued amount less accumulated depreciation and accumulated impairment losses, if any. Land is carried at revalued
amount less impairment losses while capital work-in-progress is stated at cost less impairment losses. The cost and the
accumulated depreciation of property and equipment of overseas branches include exchange differences arising on
currency translation at the year-end rates of exchange.
Depreciation is calculated so as to write off the depreciable amount of the assets over their expected useful lives at the
rates specified in note 10.2 to these unconsolidated financial statements. The depreciation charge for the year is calculated
on a straight line basis after taking into account the residual value, if any. The residual values and useful lives are reviewed
and adjusted, if appropriate, at each statement of financial position date.
Depreciation on additions is charged from the month the asset is available for use. No depreciation is charged in the month
of disposal.
10
Land and buildings are revalued by independent, professionally qualified valuers with sufficient regularity to ensure that
their net carrying amount does not differ materially from their fair value. An increase arising on revaluation is credited to the
surplus on revaluation of fixed assets account. A decrease arising on revaluation of fixed assets is adjusted against the
surplus of that asset or, if no surplus exists, is charged to the profit and loss account as an impairment of the asset. A
surplus arising subsequently on an impaired asset is reversed through the profit and loss account up to the extent of the
original impairment.
Surplus on revaluation of fixed assets (net of associated deferred tax) to the extent of the incremental depreciation charged
on the related assets is transferred to unappropriated profit.
Gains and losses on sale of fixed assets are included in the profit and loss account, except that the related surplus on
revaluation of fixed assets (net of deferred tax) is transferred directly to unappropriated profit.
Major renewals and improvements that increase the useful life of an asset are capitalized and the assets so replaced, if
any, are retired. Normal repairs and maintenance are charged to the profit and loss account as and when incurred.
4.6 Lease liability and Right-of-use asset
The bank enters into leasing arrangements for its branches, ATMs and warehouses. Rental contracts are typically for a
fixed period and may have extension options as described below. At inception of a contract, the Bank assesses whether a
contract is, or contains, a lease based on whether the contract conveys the right to control the use of an identified asset for
a period of time in exchange for consideration. Lease terms are negotiated on an individual basis and contain a wide range
of different terms and conditions.
In determining the lease term, management considers all facts and circumstances that create an economic incentive to
exercise an extension option or not exercise a termination option. Extension options (or periods after termination options)
are only included in the lease term if the lease is reasonably certain to be extended (or not be terminated).
The lease liability is initially measured at the present value of the lease payments to be made over the lease term,
discounted using the interest rate implicit in the lease, or if that rate cannot be readily determined, the Bank's incremental
borrowing rate.
Lease payments include fixed payments less any lease incentive receivable, variable lease payment that are based on an
index or a rate which are initially measured using the index or rate as at the commencement date, amounts expected to be
payable by the Bank under residual value guarantees, the exercise price of a purchase option if the Bank is reasonably
certain to exercise that option and payments of penalties for terminating the lease if the lease term reflects the lessee
exercising that option. The extension and termination options are incorporated in determination of lease term only when the
Bank is reasonably certain to exercise these options.
The lease liability is subsequently measured at amortised cost using the effective interest rate method. The lease liability is
also remeasured to reflect any reassessment or lease modification.
The lease liability is remeasured when the Bank reassesses the reasonable certainty of exercise of extension or
termination option upon occurrence of either a significant event or a significant change in circumstance, or when there is a
change in assessment of an option to purchase underlying asset, or when there is a change in amount expected to be
payable under a residual value guarantee, or when there is a change in future lease payments resulting from a change in
an index or rate used to determine those payment. The corresponding adjustment is made to the carrying amount of the
right-to-use asset, or is recorded in profit and loss if the carrying amount of right-to-use asset has been reduced to zero.
On initial recognition, right-of-use assets are measured at an amount equal to initial lease liability adjusted for any lease
payments made at or before the commencement date, plus any initial direct costs incurred and an estimate of costs to be
incurred to dismantle and remove the underlying asset or to restore the underlying asset or the site on which it is located.
The right-of-use asset is subsequently measured at cost model. The right of use asset is depreciated on a straight line
method over the lease term as this method most closely reflects the expected pattern of consumption of future economic
benefits. The right-of-use asset is reduced by impairment losses, if any, and adjusted for certain remeasurements of the
lease liability.
11
The Bank has elected to apply the practical expedient not to recognise right-of-use assets and lease liabilities for short
term leases that have a lease term of 12 months or less and leases of low-value assets. The lease payments associated
with these leases is recognised as an expense on a straight line basis over the lease term.
4.7 Intangible assets
Intangible assets are stated at cost less accumulated amortisation and accumulated impairment losses, if any. The cost
and the accumulated amortisation of intangible assets of overseas branches include exchange differences arising on
currency translation at the year-end rates of exchange. Amortisation is calculated so as to write off the amortizable amount
of the assets over their expected useful lives at the rates specified in note 11.1 to these unconsolidated financial
statements. The amortisation charge for the year is calculated on a straight line basis after taking into account the residual
value, if any. The residual values and useful lives are reviewed and adjusted, if appropriate, at each statement of financial
position date. Amortisation on additions is charged from the month the asset is available for use. No amortisation is
charged in the month of disposal.
Gains and losses on sale of intangible assets are included in the profit and loss account.
4.8 Non-banking assets acquired in satisfaction of claims
Non-banking assets acquired in satisfaction of claims are carried at revalued amounts less accumulated depreciation.
These assets are revalued by professionally qualified valuers with sufficient regularity to ensure that their net carrying value
does not differ materially from their fair value. A surplus arising on revaluation of property is credited to the 'surplus on
revaluation of non-banking assets' account. A decrease arising on revaluation of non-banking asset is adjusted against the
surplus of that asset or, if no surplus exists, is charged to the profit and loss account as an impairment of the asset. A
surplus arising subsequently on an impaired asset is reversed through the profit and loss account up to the extent of the
original impairment.
All direct costs of acquiring title to asset are charged to the profit and loss account. Gains and losses on sale of non-
banking assets are included in the profit and loss account, except that the related surplus on revaluation of non-banking
assets (net of deferred tax) is transferred directly to unappropriated profit.
4.9 Impairment
Impairment of available for sale equity investments
Available for sale equity investments are impaired when there has been a significant or prolonged decline in their fair value
below their cost. The determination of what is significant or prolonged requires judgment. In making this judgment, the
Bank evaluates, among other factors, the normal volatility in share price. A subsequent increase in the fair value of a
previously impaired listed equity security is recorded in the statement of financial position in the surplus / deficit on
revaluation of securities account and only recorded through the profit and loss account when realised on disposal.
Impairment of debt investments
Provisions for diminution in the value of debt securities are made as per the ageing criteria prescribed by the Prudential
Regulations issued by the SBP. Provision against debt investments by the Bank's overseas branches is made as per the
requirements of the respective regulatory regimes in which the overseas branches operate.
Impairment of investments in subsidiaries and associates
The Bank considers that a decline in the recoverable value of the investment in a subsidiary or an associate below its cost
may be evidence of impairment. Recoverable value is calculated as the higher of fair value less costs to sell and value in
use. An impairment loss is recognised when the recoverable value falls below the carrying value and is charged to the
profit and loss account. A subsequent reversal of an impairment loss, upto the cost of the investment in the subsidiary or
the associate, is credited to the profit and loss account.
12
4.10 Taxation
Current
Provision for current taxation is based on taxable income for the year determined in accordance with the prevailing laws
and at the prevailing rates for taxation on income earned by the Bank for local as well as overseas operations. The amount
of current tax payable is the best estimate of the tax amount expected to be paid that reflects uncertainty related to income
taxes, if any. It is measured using tax rates enacted or substantively enacted at the reporting date.
Deferred
Deferred tax is recognised using the balance sheet method on all major temporary differences between the amounts
attributed to assets and liabilities for financial reporting purposes and the amounts used for taxation purposes. Deferred tax
is calculated at the rates that are expected to apply to the period when the differences are expected to reverse, based on
tax rates that have been enacted or substantively enacted at the reporting date.
Deferred tax assets are recognised only to the extent that it is probable that future taxable profits will be available against
which the assets can be utilized.
The carrying amount of deferred tax assets is reviewed at each statement of financial position date and reduced to the
extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the deferred tax asset
to be utilized.
The Bank also recognizes deferred tax asset / liability on the deficit / surplus on revaluation of fixed assets / non-banking
assets acquired in satisfaction of claims and securities which is adjusted against the related deficit / surplus in accordance
with the requirements of IAS 12, Income Taxes.
4.11 Provisions
Provisions are recognised when the Bank has a present legal or constructive obligation as a result of past events, it is
probable that an outflow of resources will be required to settle the obligation and a reliable estimate of the amount can be
made.
Provision for off balance sheet obligations is recognised when intimated and reasonable certainty exists that the Bank will
be required to settle the obligation. The provision is charged to the profit and loss account net of expected recovery and the
obligation is classified under other liabilities.
Provisions are reviewed at each statement of financial position date and are adjusted to reflect the current best estimate.
4.12 Staff retirement and other benefits
The Bank operates the following defined benefit plans for its employees:
a) For new employees and for those who opted for the below mentioned conversion option introduced in 2001, the Bank
operates:
- an approved contributory provident fund (defined contribution plan); and

- an approved gratuity scheme (defined benefit plan).
b) For employees who have not opted for the conversion option introduced in 2001, the Bank operates:
- an approved non-contributory provident fund in lieu of the contributory provident fund; and
- an approved funded pension scheme, introduced in 1975 (defined benefit plan).
In 2001, the Bank modified the pension scheme and introduced a conversion option for employees covered under option
(b) above to move to option (a). This conversion option ceased on December 31, 2003.
The Bank also operates benevolent fund for all its eligible employees (defined benefit plan).
13
Annual contributions towards defined benefit plans are made on the basis of actuarial advice using the Projected Unit
Credit Method.
For the defined contribution scheme, the Bank pays contributions to the fund on a periodic basis. The Bank has no further
payment obligation once the contributions have been paid. The contributions are recognised as an expense when the
obligation to make payments to the fund has been established. Prepaid contributions are recognised as an asset to the
extent that a cash refund or a reduction in future payments is available.
4.12.1 Other benefits
a) Employees' compensated absences
The Bank makes provisions for compensated vested and non-vested absences accumulated by its eligible employees
on the basis of actuarial advice under the Projected Unit Credit Method.
b) Post-retirement medical benefits (defined benefit scheme)
The Bank provides post-retirement medical benefits to eligible retired employees. Provision is made on the basis of
actuarial advice under the Projected Unit Credit Method.
4.12.2 Remeasurement of defined benefit obligations
Remeasurement gains and losses arising from experience adjustments and changes in actuarial assumptions are
recognised in other comprehensive income when they occur with no subsequent recycling through the profit and loss
account.
Remeasurement gains and losses pertaining to long term compensated absences are recognised in the profit and loss
account immediately.
4.13 Subordinated debt
Subordinated debt is initially recorded at the amount of proceeds received. Mark-up accrued on subordinated debt is
recognised separately as part of other liabilities and is charged to the profit and loss account over the period on an accrual
basis.
4.14 Borrowings / deposits
Borrowings / deposits are recorded at the amount of proceeds received. The cost of borrowings / deposits is recognised on
an accrual basis as an expense in the period in which it is incurred.
4.15 Revenue recognition
Revenue is recognised to the extent that the economic benefits associated with a transaction will flow to the Bank and the
revenue can be reliably measured. The following recognition criteria must be met before revenue is recognised.
4.15.1 Advances and investments
Mark-up / return / interest on performing advances and investments is recognised on a time proportionate basis over the
term of the advances and investments that takes into account the effective yield of the asset. Where debt securities are
purchased at a premium or discount, such premium / discount is amortised through the profit and loss account over the
remaining period of maturity of the debt securities.
Interest or mark-up recoverable on non-performing advances and investments is recognised on a receipt basis.
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4.15.2 Lease financing
Income from lease financing is accounted for using the financing method. Under this method, the unearned lease income
(defined as the sum of total lease rentals and estimated residual value less the cost of the leased assets) is deferred and
taken to income over the term of the lease so as to produce a constant periodic rate of return on the outstanding net
investment in the lease. Gains or losses on termination of lease contracts are recognised through the profit and loss
account when these are realised. Unrealised lease income and other fees on classified leases are recognised on a receipt
basis.
4.15.3 Dividend income
Dividend income is recognised when the right to receive the dividend is established.
4.15.4 Fee, brokerage and commission income
Fee, brokerage and commission income is recognised on an accrual basis.
4.16 Foreign currencies
4.16.1 Functional and presentation currency
Items included in these unconsolidated financial statements are measured using the currency of the primary economic
environment in which the Bank operates. These unconsolidated financial statements are presented in Pakistani Rupees,
which is the Bank's functional and presentation currency.
4.16.2 Foreign currency transactions
Transactions in foreign currencies are translated to rupees at the foreign exchange rates prevailing on the transaction date.
Monetary assets and liabilities in foreign currencies are expressed in rupee terms at the rates of exchange prevailing at the
statement of financial position date. Forward foreign exchange contracts and foreign bills purchased are valued in rupees
at the forward foreign exchange rates applicable to their respective maturities.
Non-monetary assets and liabilities in foreign currencies are expressed in rupee terms at the rates of exchange prevailing
at the date of initial recognition of the non-monetary assets / liabilities.
4.16.3 Overseas operations
The assets and liabilities of overseas operations are translated to rupees at exchange rates prevailing at the statement of
financial position date. The results of overseas operations are translated at the average rates of exchange for the year.
4.16.4 Translation gains and losses
Translation gains and losses are taken to the profit and loss account, except those arising on translation of the net
investment in foreign branches which are taken to capital reserves (Exchange Translation Reserve) until the disposal of the
net investment, at which time these are recognised in the profit and loss account.
4.16.5 Contingencies and commitments
Commitments for outstanding forward foreign exchange contracts are disclosed in these unconsolidated financial
statements at contracted rates. Contingent liabilities / commitments denominated in foreign currencies are expressed in
rupee terms at the rates of exchange prevailing at the statement of financial position date.
4.17 Financial instruments
4.17.1 Financial assets and liabilities
Financial assets and liabilities carried on the statement of financial position include cash and bank balances, lendings to
financial institutions, investments, advances, certain receivables, bills payable, borrowings from financial institutions,
deposits, subordinated loans and certain payables. The particular recognition methods adopted for significant financial
assets and financial liabilities are disclosed in the individual policy notes associated with them.
15
4.17.2 Derivative financial instruments
Derivative financial instruments are initially recognised at fair value on the date on which the derivative contract is entered
into and are subsequently re-measured at fair value using appropriate valuation techniques. All derivative financial
instruments are carried as assets when their fair value is positive and liabilities when their fair value is negative. Any
change in the fair value of derivative financial instruments during the year is taken to the profit and loss account.
4.17.3 Off setting
Financial assets and financial liabilities are set off and the net amount is reported in the unconsolidated financial
statements when there is a legally enforceable right to set off and the Bank intends to either settle on a net basis, or to
realise the assets and to settle the liabilities simultaneously.
4.18 Segment reporting
A segment is a distinguishable component of the Bank that is engaged either in providing particular products or services
(business segment), or in providing products or services within a particular economic environment (geographical segment),
and is subject to risks and rewards that are different from those of other segments.
4.18.1 Business segments
(a) Corporate / Commercial Banking
Includes project, trade and working capital finance, import and export, factoring, leasing, lending, deposits and
guarantees. It also include services provided in connection with mergers and acquisitions and the underwriting /
arrangement of debt and equity instruments through syndications, Initial Public Offerings and private placements.
(b) Treasury
Includes fixed income, equity, foreign exchange, credit, funding, own position securities, lendings and borrowings and
derivatives for hedging and market making.
(c) Branch Banking
Includes deposits, lendings and banking services to private individuals and small businesses including credit cards and
branchless banking.
(d) Islamic Banking
This represents islamic banking branches and islamic banking windows in the conventional branches of the Bank.
(e) International Branch Operations
This represents Bank's operations in overseas locations including one branch each in export processing zones in
Karachi and Sialkot.
(f) Others
Others includes functions which cannot be classified in any of the above segments.
4.18.2 Geographical segments
The Bank operates in following geographical regions:
- Pakistan
- Middle East
- Export Processing Zones in Karachi and Sialkot.
16
4.19 Dividends and appropriations to reserves
Dividends and appropriations to reserves are recorded in the year in which these are approved, except appropriations
required by law which are recorded in the period to which they pertain.
4.20 Earnings per share (EPS)
The Bank presents basic and diluted earnings per share. Basic and diluted EPS is calculated by dividing the profit or loss
attributable to ordinary shareholders of the Bank by the weighted average number of ordinary shares outstanding during
the year.
4.21 Acceptances
Acceptances comprise undertakings by the Bank to pay bill of exchange drawn on customers. Acceptances are recognised
as financial liability in the statement of financial position with a contractual right of reimbursement from the customer as a
financial asset. Therefore, commitments in respect of acceptances have been accounted for as on balance sheet financial
assets and financial liabilities.
Note 2021 2020

-------------- (Rupees in '000) --------------
5. CASH AND BALANCES WITH TREASURY BANKS
In hand
Local currency 27,262,667 20,776,101
Foreign currencies 6,987,106 12,098,863
34,249,773 32,874,964
With State Bank of Pakistan in
Local currency current accounts 5.1 75,005,750 75,604,954
Foreign currency current accounts 5.2 5,312,400 4,420,727
Foreign currency deposit accounts 5.3 8,818,135 7,767,517
89,136,285 87,793,198
With other central banks in
Foreign currency current accounts 5.4 31,754,341 28,800,193
Foreign currency deposit accounts 5.5 8,148,977 6,869,307
39,903,318 35,669,500
With National Bank of Pakistan in local currency current accounts 104,153,210 92,628,531
National Prize Bonds 494,696 1,871,859
267,937,282 250,838,052
5.1 This represents current accounts maintained with the SBP under the Cash Reserve Requirement of section 22 of the
Banking Companies Ordinance, 1962.
5.2 These represent foreign currency current accounts maintained under the Cash Reserve Requirement of the SBP.
5.3 This represents account maintained with the SBP to comply with the Special Cash Reserve requirement. The return on this
account is declared by the SBP on a monthly basis and as at December 31, 2021, it carries mark-up at the rate of 0.00%
(2020: 0.00%) per annum.
5.4 These represent current accounts maintained with other central banks of the countries in which the Bank operates, to meet
the minimum cash reserves and capital requirements pertaining to the overseas branches of the Bank.
5.5 These represent placements with overseas central banks and carry mark-up at rates ranging from 0.75% to 1.50% (2020:
0.75% to 2.00%) per annum.
17
Note 2021 2020

-------------- (Rupees in '000) --------------
6. BALANCES WITH OTHER BANKS
In Pakistan
In deposit accounts 6.1 6,350,000 2,000,000
Outside Pakistan
In current accounts 8,075,999 7,354,534
In deposit accounts 6.2 8,937,058 4,534,231
17,013,057 11,888,765
23,363,057 13,888,765
6.1 This carries mark-up at the rate of 11% (2020: 7.15%) per annum and is due to mature in January 2022.
6.2 These carry mark-up at rates ranging from 0.02% to 1.35% (2020: 0.05% to 1.50%) per annum.
Note 2021 2020

-------------- (Rupees in '000) --------------
7. LENDINGS TO FINANCIAL INSTITUTIONS
Call / clean money lending 7.2 100,000 10,500,000

Repurchase agreement lendings (reverse repo) 7.3 & 7.5 49,726,776 -
Placements with State Bank of Pakistan 7.4 1,874,300 -
Bai Muajjal receivable with

State Bank of Pakistan - 6,433,114
Other financial institutions - 3,026,018
51,701,076 19,959,132
7.1 Particulars of lendings to financial institutions
In local currency 51,701,076 19,959,132
7.2 These represent unsecured lendings carrying mark-up at the rate of 9.50% (2020: 7.15% to 7.30%) per annum and is due
to mature in February 2022.
7.3 These represent lendings to financial institutions against investment securities. These carry mark-up ranging from 9.75% to
10.70% per annum, and are due to mature in January 2022.
7.4 These represent placements made with the SBP as a result of shortfall in respect of time-based mandatory targets of
disbursements under Government's scheme "Mera Pakistan Mera Ghar". These placements are for a period of six months
to one year and carry no mark-up.
7.5 Securities held as collateral against repurchase agreement lendings (reverse repo)
2021 2020
Further given as Further given as
Held by Bank Total Held by Bank Total
collateral collateral
--------------------------------------------------------------------- (Rupees in '000) ---------------------------------------------------------------------
Market Treasury Bills 16,771,723 12,358,229 29,129,952 - - -

Pakistan Investment Bonds - fixed 7,027,709 13,569,115 20,596,824 - - -
Total 23,799,432 25,927,344 49,726,776 - - -
18
8. INVESTMENTS 2021 2020

Cost / Provision Cost / Provision
Surplus / Carrying Surplus / Carrying
8.1 Investments by type Note Amortised for Amortised for
(Deficit) Value (Deficit) Value
cost diminution cost diminution
------------------------------------------------------------------------------------------- (Rupees in '000) --------------------------------------------------------------------------------------
Held for trading securities
Federal Government Securities
- Market Treasury Bills 69,718,806 - 9,101 69,727,907 3,009,238 - 228 3,009,466
- Pakistan Investment Bonds - fixed 8.8 4,883,004 - 7,053 4,890,057 - - - -
- Pakistan Investment Bonds - floaters 250,697 - 128 250,825 - - - -
74,852,507 - 16,282 74,868,789 3,009,238 - 228 3,009,466
Available for sale securities
Federal Government securities
- Market Treasury Bills 462,307,400 - (295,082) 462,012,318 341,885,979 - 238,363 342,124,342
- Pakistan Investment Bonds - fixed 106,428,744 - (956,951) 105,471,793 76,334,054 - 333,950 76,668,004
8.8
- Pakistan Investment Bonds - floaters 365,357,391 - (1,612,560) 363,744,831 340,678,646 - (2,569,332) 338,109,314
- Government of Pakistan Sukuks 43,996,036 - (265,636) 43,730,400 23,232,221 (8,713) (50,261) 23,173,247
- Islamic Naya Pakistan Certificates 8.4 924,941 - - 924,941 466,435 - - 466,435
- Government of Pakistan Eurobonds 22,789,875 (285,929) 49,770 22,553,716 24,216,628 (105,010) 1,126,146 25,237,764
Ordinary shares
- Listed companies 13,269,396 (4,623,052) 1,019,365 9,665,709 13,345,156 (5,479,476) 2,517,580 10,383,260
8.6.2
- Unlisted companies 790,083 (60,440) 41 729,684 808,294 (134,392) 36 673,938
Non-Government debt securities
- Corporate Sukuks 1,452,143 - - 1,452,143 1,220,000 - - 1,220,000
- Term Finance Certificates 782,335 (161,996) - 620,339 662,335 (162,033) - 500,302
Foreign securities
- Foreign bonds - sovereign 8.6.5 41,692,161 (383,468) (1,325,534) 39,983,159 53,560,498 (909,881) 2,494,807 55,145,424
- Foreign bonds - others 1,187,962 (1,103) 8,036 1,194,895 4,494,088 (24,002) 299,217 4,769,303
Preference shares - - - - 36,667 - - 36,667
Mutual Fund units 258,179 - (15,711) 242,468 250,000 - (21,482) 228,518
Real Estate Investment Trust units 458,590 - 48,360 506,950 458,590 - (16,676) 441,914
1,061,695,236 (5,515,988) (3,345,902) 1,052,833,346 881,649,591 (6,823,507) 4,352,348 879,178,432
Held to maturity securities
Federal Government securities
- Pakistan Investment Bonds - fixed 216,576,752 - - 216,576,752 160,738,122 - - 160,738,122
- Pakistan Investment Bonds - floaters 8.8 47,666,897 - - 47,666,897 - - - -
- Government of Pakistan Sukuks 10,002,935 - - 10,002,935 824,745 (3,374) - 821,371
- Government of Pakistan Eurobonds 10,381,683 (141,574) - 10,240,109 9,383,208 (45,483) - 9,337,725
- Bai Muajjal with Government of Pakistan 8.5 21,214,989 - - 21,214,989 29,569,648 - - 29,569,648
Non-Government debt securities
- Corporate Sukuks 10,580,384 (50,934) - 10,529,450 12,022,819 (57,845) - 11,964,974
- Term Finance Certificates 8,079,835 (69,951) - 8,009,884 4,516,483 (69,951) - 4,446,532
- Debentures 2,267 (2,267) - - 2,267 (2,267) - -
- Participation Term Certificates 437 (437) - - 437 (437) - -
- Corporate Bond 1,715,945 (23,356) - 1,692,589 - - - -
Foreign securities
- Market Treasury Bills 2,682,985 - - 2,682,985 2,696,727 - - 2,696,727
8.7.3
- Foreign bonds - sovereign 33,578,466 (641,202) - 32,937,264 21,361,427 (628,582) - 20,732,845
- Foreign bonds - others 2,171,411 (11,610) - 2,159,801 1,261,784 (23,219) - 1,238,565
- CDC SAARC Fund 383 - - 383 347 - - 347
364,655,369 (941,331) - 363,714,038 242,378,014 (831,158) - 241,546,856
Associates
- UBL Financial Sector Fund 366,640 - - 366,640 150,000 - - 150,000
- UBL Insurers Limited 240,000 - - 240,000 240,000 - - 240,000
- Khushhali Bank Limited 8.10 832,485 - - 832,485 832,485 - - 832,485
1,439,125 - - 1,439,125 1,222,485 - - 1,222,485
Subsidiaries
- United National Bank Limited (UBL UK) 2,855,223 - - 2,855,223 2,855,223 - - 2,855,223
- UBL (Switzerland) AG 8.13 589,837 - - 589,837 589,837 - - 589,837
- UBL Fund Managers Limited 100,000 - - 100,000 100,000 - - 100,000
- United Executors and Trustees -
Company Limited 8.11 - - - - 30,100 - - 30,100
3,545,060 - - 3,545,060 3,575,160 - - 3,575,160
Discontinued operation
- UBL Bank (Tanzania) Limited 8.12 1,831,006 (1,688,911) - 142,095 1,831,006 (1,688,911) - 142,095
Total Investments 1,508,018,303 (8,146,230) (3,329,620) 1,496,542,453 1,133,665,494 (9,343,576) 4,352,576 1,128,674,494
19
2021 2020
Surplus / Carrying Surplus / Carrying
Amortised for Amortised for
(Deficit) Value (Deficit) Value
8.2 ------------------------------------------------------------------------------------------- (Rupees in '000) ------------------------------------------------------------------------------------
Investments by segment

Market Treasury Bills 532,026,206 - (285,981) 531,740,225 344,895,217 - 238,591 345,133,808
Pakistan Investment Bonds - fixed 327,888,500 - (949,898) 326,938,602 237,072,176 - 333,950 237,406,126
Pakistan Investment Bonds - floaters 413,274,985 - (1,612,432) 411,662,553 340,678,646 - (2,569,332) 338,109,314
Government of Pakistan Sukuks 53,998,971 - (265,636) 53,733,335 24,056,966 (12,087) (50,261) 23,994,618
Government of Pakistan Eurobonds 33,171,558 (427,503) 49,770 32,793,825 33,599,836 (150,493) 1,126,146 34,575,489
Bai Muajjal with Government of Pakistan 21,214,989 - - 21,214,989 29,569,648 - - 29,569,648
Islamic Naya Pakistan Certificates 924,941 - - 924,941 466,435 - - 466,435
1,382,500,150 (427,503) (3,064,177) 1,379,008,470 1,010,338,924 (162,580) (920,906) 1,009,255,438
Ordinary shares
Listed companies 13,269,396 (4,623,052) 1,019,365 9,665,709 13,345,156 (5,479,476) 2,517,580 10,383,260
Unlisted companies 790,083 (60,440) 41 729,684 808,294 (134,392) 36 673,938
14,059,479 (4,683,492) 1,019,406 10,395,393 14,153,450 (5,613,868) 2,517,616 11,057,198
Preference shares - - - - 36,667 - - 36,667

Mutual Fund units 258,179 - (15,711) 242,468 250,000 - (21,482) 228,518
Real Estate Investment Trust units 458,590 - 48,360 506,950 458,590 - (16,676) 441,914
Non-Government Debt Securities

Listed companies 2,463,124 (161,998) - 2,301,126 1,830,661 (162,034) - 1,668,627
Unlisted companies 20,150,222 (146,943) - 20,003,279 16,593,680 (130,499) - 16,463,181
22,613,346 (308,941) - 22,304,405 18,424,341 (292,533) - 18,131,808
Foreign Securities
Market Treasury Bills 2,682,985 - - 2,682,985 2,696,727 - - 2,696,727
Foreign bonds - sovereign 75,270,627 (1,024,670) (1,325,534) 72,920,423 74,921,925 (1,538,463) 2,494,807 75,878,269
Foreign bonds - others 3,359,373 (12,713) 8,036 3,354,696 5,755,872 (47,221) 299,217 6,007,868
CDC SAARC Fund 383 - - 383 347 - - 347
81,313,368 (1,037,383) (1,317,498) 78,958,487 83,374,871 (1,585,684) 2,794,024 84,583,211
Associates
UBL Financial Sector Fund 366,640 - - 366,640 150,000 - - 150,000
UBL Insurers Limited 240,000 - - 240,000 240,000 - - 240,000
Khushhali Bank Limited 8.10 832,485 - - 832,485 832,485 - - 832,485
1,439,125 - - 1,439,125 1,222,485 - - 1,222,485
Subsidiaries
United National Bank Limited (UBL UK) 2,855,223 - - 2,855,223 2,855,223 - - 2,855,223
UBL (Switzerland) AG 8.13 589,837 - - 589,837 589,837 - - 589,837
UBL Fund Managers Limited 100,000 - - 100,000 100,000 - - 100,000
United Executors and Trustees
Company Limited 8.11 - - - - 30,100 - - 30,100
3,545,060 - - 3,545,060 3,575,160 - - 3,575,160
Discontinued operations
UBL Bank (Tanzania) Limited 8.12 1,831,006 (1,688,911) - 142,095 1,831,006 (1,688,911) - 142,095
Total Investments 1,508,018,303 (8,146,230) (3,329,620) 1,496,542,453 1,133,665,494 (9,343,576) 4,352,576 1,128,674,494
20
2021 2020
8.2.1 Investments given as collateral ------------ (Rupees in '000) ------------
Market Treasury Bills 215,584,125 59,843,910

Pakistan Investment Bonds - floaters 232,144,261 -
Pakistan Investment Bonds - fixed 1,853,526 -
449,581,912 59,843,910
8.2.1.1 The market value of securities given as collateral is Rs. 448,718 million (2020: Rs. 59,846 million).
Note 2021 2020

8.3 Provision for diminution in value of investments ------------ (Rupees in '000) ------------
Opening balance 9,343,576 9,117,891

Exchange adjustments 155,536 34,098
(Reversals) / charge
Charge for the year 446,250 835,040
Reversals for the year (555,978) (30,024)
Reversal on disposals (1,161,770) (463,465)
32 (1,271,498) 341,551
Amounts written off (81,384) (149,964)
Closing balance 8.3.1 8,146,230 9,343,576
8.3.1 Provision against investments includes Expected Credit Losses (ECL) under IFRS 9 amounting to Rs. 1,488.282 million
(2020: Rs. 1,748.301 million) on investments of overseas branches.
8.3.2 Particulars of provision against debt securities
2021 2020
Category of classification Non- Non-
performing Provision performing Provision
investments investments
---------------------------------------- (Rupees in '000) ------------------------------------
Domestic
Loss 285,585 285,585 292,496 292,496
Total 285,585 285,585 292,496 292,496
8.4 This represents investment made for the establishment of the modaraba pools in Islamic Naya Pakistan Certificate
Company Limited in accordance with S.R.O 964 (I) / 2020 dated October 05, 2020.
2021 2020
8.5 Bai Muajjal with Government of Pakistan ---------- (Rupees in '000) ----------
Bai Muajjal investment 21,611,000 33,031,000

Less: Deferred Income (396,011) (3,461,352)
Bai Muajjal investment - net 21,214,989 29,569,648
8.6 Quality of Available for Sale Securities
Details regarding quality of Available for Sale securities are as follows: 2021 2020
Cost
8.6.1 Federal Government Securities - Government guaranteed ---------- (Rupees in '000) ----------
Market Treasury Bills 462,307,400 341,885,979

Pakistan Investment Bonds - fixed 106,428,744 76,334,054
Pakistan Investment Bonds - floaters 365,357,391 340,678,646
Government of Pakistan Sukuks 43,996,036 23,232,221
Islamic Naya Pakistan Certificates 924,941 466,435
Government of Pakistan Eurobonds 22,789,875 24,216,628
1,001,804,387 806,813,963
21
2021 2020
8.6.2 Shares Cost
---------- (Rupees in '000) ----------
Listed Companies
Cement 1,195,440 592,327
Chemical 559,228 875,779
Commercial Banks 366,799 337,311
Fertilizer 4,951,022 5,104,212
Oil & Gas Exploration Companies 1,173,920 603,266
Oil & Gas Marketing Companies 569,150 579,373
Power Generation & Distribution 2,568,653 4,665,889
Technology & Communication 309,366 42,995
Textile Composite 543,544 543,544
Textile Spinning 401,680 460
Engineering 315,872 -
Miscellaneous 314,722 -
13,269,396 13,345,156
2021 2020
Cost Breakup value Cost Breakup value
--------------------------------------------------- (Rupees in '000) -----------------------------------------
Unlisted Companies
SME Bank Limited 26,950 - 26,950 -
First Women Bank Limited 21,100 69,511 21,100 69,511
National Institutional Facilitation
Technologies (Pvt.) Limited (NIFT) 1,527 35,899 1,527 51,998
National Investment Trust Limited (NIT) 100 971,711 100 830,783
Pakistan Agricultural Storage & Services
Corporation (PASSCO) 5,500 3,448,615 5,500 2,725,903
SWIFT (Belgium) 2,091 15,658 2,905 19,417
VIS Credit Information Services 325 104 325 64
Mastercard International 0.003 523 0.003 431
Kay Textile Mills Limited - - 3,778 -
World Bridge Connect Incorporation - - 77,606 -
Techlogix International Limited 50,703 21,419 50,703 24,941
Cinepax Limited 60,122 163,786 60,122 175,313
Pakistan Mortgage Refinance Company Limited 500,000 827,525 500,000 630,862
1Link (Private) Limited 54,287 267,895 54,287 202,032
The Benefit Company BSC 3,745 102,811 3,391 93,101
Pakistan Corporate Restructuring Company Limited 63,633 59,689 - -
790,083 5,985,146 808,294 4,824,356
2021 2020
Cost
8.6.3 Others ------------- (Rupees in '000) -------------
Preference shares - 36,667

Mutual Fund units 258,179 250,000
Real Estate Investment Trust units 458,590 458,590
8.6.4 Non Government Debt Securities
Listed
- AA- 370,000 250,000
- A, A- 400,000 250,000
770,000 500,000
22
2021 2020
Cost
------------- (Rupees in '000) -------------
Unlisted
- AA 695,002 420,000
- A+, A, A- 607,141 800,000
- Unrated 162,335 162,335
1,464,478 1,382,335
2021 2020
8.6.5 Foreign Securities Cost Rating Cost Rating
-------------------------------------------------------- (Rupees in '000) -----------------------------------------
Government Securities
United Arab Emirates 9,808,862 AA 12,550,990 AA
Qatar 5,778,888 AA- 8,294,761 AA-
South Africa 1,324,904 BB 798,948 BB
Oman 2,301,803 BB- 5,342,200 BB-
Jordan 1,938,979 B+ 3,672,314 B+
Egypt 3,155,838 B 4,847,877 B
Kenya 2,182,135 B 1,190,908 B
Bahrain 5,305,846 B 6,539,325 B
Nigeria 1,175,329 B 1,563,239 B
Turkey 5,072,195 B 4,230,991 B
Sri Lanka 3,647,382 CC 4,528,945 CCC
41,692,161 53,560,498
2021 2020
Non Government Debt Securities Cost
------------- (Rupees in '000) -------------
Listed
- AA - 288,705
- BBB+, BBB- 877,325 734,470
-B - 1,109,941
- Unrated 310,637 2,360,972
1,187,962 4,494,088
8.7 Particulars relating to Held to Maturity securities are as follows:
8.7.1 Federal Government Securities - Government guaranteed
Pakistan Investment Bonds - fixed 216,576,752 160,738,122

Pakistan Investment Bonds - floaters 47,666,897 -
Government of Pakistan Sukuks 10,002,935 824,745
Government of Pakistan Eurobonds 10,381,683 9,383,208
Bai Muajjal 21,214,989 29,569,648
305,843,256 200,515,723
8.7.2 Non Government Debt Securities
Listed
- AA+, AA- 1,443,124 1,168,328
- A+ 250,000 -
1,693,124 1,168,328
Unlisted
- AAA 10,786,210 7,778,230
- AA+, AA- - 1,419,237
- A+, A 510,000 685,713
- B- 1,715,945 -
- Unrated 5,673,589 5,490,498
18,685,744 15,373,678
23
8.7.3 Foreign Securities

2021 2020
Government Securities Cost Rating Cost Rating
-------------------------------------------------------- (Rupees in '000) ----------------------------------------
Qatar 5,675,107 AA- 3,434,345 AA-

Portugal 783,287 BBB 711,520 BBB-
South Africa 1,315,332 BB 798,948 BB
Oman 3,369,670 BB- 2,409,048 BB-
Jordan 4,985,479 B+ 2,768,623 B+
Bahrain 3,712,498 B 3,008,615 B
Egypt 3,554,567 B 2,488,387 B
Kenya 2,938,151 B 1,190,482 B
Turkey 2,969,272 B 2,180,924 B
Nigeria 874,914 B - -
Sri Lanka 3,400,189 CC 2,370,534 CCC
Yemen 2,682,985 unrated 2,696,728 unrated
36,261,451 24,058,154
2021 2020
Non Government Debt Securities Cost
----------- (Rupees in '000) -----------
Listed
- BBB+, BBB- 70,606 63,934
-B 1,223,295 1,109,941
- Unrated - 87,909
1,293,901 1,261,784
Unlisted
- BBB- 877,510 -
Others
CDC SAARC Fund 383 347
8.7.4 The market value of securities classified as held-to-maturity as at December 31, 2021, amounted to Rs. 354,991.660
million (2020: Rs. 246,788.536 million).
8.8 Investments include securities amounting to Rs. 927,853 million (2020: Rs. 797,529 million) which are held by the Bank to
comply with the statutory liquidity requirements as set out under Section 29 of the Banking Companies Ordinance, 1962.
8.9 Investments include Rs. 118 million (2020: Rs. 118 million) held by the State Bank of Pakistan as pledge against demand
loan, TT / DD discounting facilities and foreign exchange exposure limit sanctioned to the Bank and Rs. 5 million (2020: Rs.
5 million) held by the Controller of Military Accounts (CMA) under Regimental Fund Arrangements.
8.10 This represents the Bank's subscription towards the paid-up capital of Khushhali Bank Limited. Pursuant to section 10 of
the Khushhali Bank Ordinance, 2000 strategic investors including the Bank cannot sell or transfer their investment before a
period of five years that has expired on October 10, 2005. Thereafter, such sale / transfer would be subject to the prior
approval of the SBP. However, these shares are still appearing as frozen as no approval has been obtained by the Bank to
unfreeze these shares.
8.11 The United Executors and Trustees Company Limited (UET) has been voluntarily wound up under the Companies Act,
2017 on December 28, 2021. Earlier, the shareholders of the Bank, in their annual general meeting held on March 27,
2020, resolved to wind up UET, a wholly owned subsidiary of the Bank. Accordingly, a special resolution was passed on
March 19, 2021 by the shareholders of UET to appoint liquidators and voluntarily wind up the Company. The liquidators
duly completed the process of winding-up under the Companies Act, 2017. The final general meeting of the contributories
was held on December 28, 2021 and the return of final winding-up meeting was duly filed with the Securities and Exchange
Commission of Pakistan on December 29, 2021, completing the winding-up process.
24
8.12 UBL Bank (Tanzania) Limited (UBTL) is a wholly owned subsidiary of United Bank Limited. UBTL sold materially all of its
assets and liabilities held as at October 31, 2019, including the loans and advances and deposit book to EXIM Bank Tanzania
Limited (Exim), in line with the Asset and Liabilities Purchase Agreement signed on May 22, 2019. The control of these
assets and liabilities was transferred to Exim effective from November 01, 2019. The Banking operations of the subsidiary
ceased on November 01, 2019. UBTL is in process of winding up and voluntary liquidation. The official liquidator has been
appointed by Board of Directors of UBTL.
8.13 The shareholders of the Bank have resolved to voluntarily and orderly wind up UBL (Switzerland) AG, a wholly owned
subsidiary of the Bank in the Extra Ordinary General Meeting (EOGM) of shareholders held on August 06, 2021. This
decision is in line with the Bank’s strategy to exit from non-core markets. The winding up is subject to fulfilment of relevant
legal and regulatory requirements both in Pakistan and Switzerland.
8.14 Summary of financial position and performance of associates and subsidiaries
2021
Country of
Holding (%) Assets Liabilities Revenue Profit / (loss)
Incorporation
--------------------------------------------------------- (Rupees in '000) -----------------------------------------------------
Associates
UBL Financial Sector Fund Pakistan 23.69% 1,496,764 26,920 95,578 41,785
UBL Insurers Limited Pakistan 30.00% 5,760,489 4,022,323 1,793,771 61,684
Khushhali Bank Limited Pakistan 29.69% 116,458,398 105,188,300 11,851,352 662,435
Subsidiaries
United National Bank Limited (UBL UK) United Kingdom 55.00% 158,086,439 139,142,776 2,989,125 372,188
UBL (Switzerland) AG Switzerland 100.00% 6,833,143 1,069,442 588,471 (999,702)
UBL Fund Managers Limited Pakistan 98.87% 4,356,847 2,295,892 1,014,900 389,464
UBL Bank (Tanzania) Limited Tanzania 100.00% 240,248 86,616 - (69,775)
2020
Country of
Holding (%) Assets Liabilities Revenue Profit / (loss)
Incorporation
--------------------------------------------------------- (Rupees in '000) -----------------------------------------------------
Associates
UBL Financial Sector Fund Pakistan 12.39% 1,178,034 73,543 (46,647) (84,869)
UBL Insurers Limited Pakistan 30.00% 5,876,518 4,205,955 1,841,543 65,865
Khushhali Bank Limited Pakistan 29.69% 107,288,360 96,415,309 11,656,654 1,734,808
Subsidiaries
United National Bank Limited (UBL UK) United Kingdom 55.00% 131,552,572 114,916,979 2,565,956 (448,650)
UBL (Switzerland) AG Switzerland 100.00% 23,062,408 16,471,494 879,409 145,515
UBL Fund Managers Limited Pakistan 98.87% 2,781,415 771,203 928,450 311,888
United Executors and Trustees
Company Limited Pakistan 100.00% 135,259 701 9,911 6,535
UBL Bank (Tanzania) Limited Tanzania 100.00% 219,488 11,575 312 (16,373)
9. ADVANCES Note Performing Non-performing Total

2021 2020 2021 2020 2021 2020
---------------------------------------------- (Rupees in '000) --------------------------------------------------------
Loans, cash credits, running finances, etc. 9.1 561,742,044 474,312,018 83,224,648 80,691,738 644,966,692 555,003,756
Islamic financings and related assets 9.8 43,859,593 20,542,257 197,330 107,478 44,056,923 20,649,735
Bills discounted and purchased 36,670,914 30,828,990 2,591,046 2,824,527 39,261,960 33,653,517
Advances - gross 642,272,551 525,683,265 86,013,024 83,623,743 728,285,575 609,307,008
Provision against advances 9.4

- Specific - - (74,703,857) (71,755,668) (74,703,857) (71,755,668)
- General (7,393,261) (7,271,844) - - (7,393,261) (7,271,844)
(7,393,261) (7,271,844) (74,703,857) (71,755,668) (82,097,118) (79,027,512)
Advances - net of provision 634,879,290 518,411,421 11,309,167 11,868,075 646,188,457 530,279,496
25
9.1 Includes net investment in finance lease as disclosed below:
2021 2020
Later than
Not later Later than one
one and More than five Not later than More than five
than one Total and upto five Total
upto five years one year years
year years
years
------------------------------------------------------------------------------------------------------------------------- (Rupees in '000) ----------------------------------------------------------------------------------------------------------
Minimum lease payments 45,314 55,160 611 101,085 48,099 73,894 - 121,993
Financial charges for future periods (8,502) (14,848) (245) (23,595) (6,548) (15,936) - (22,484)
Present value of minimum
lease payments 36,812 40,312 366 77,490 41,551 57,958 - 99,509
2021 2020
9.2 Particulars of advances (Gross) ------- (Rupees in '000) -------

In foreign currencies 197,124,277 156,282,810
728,285,575 609,307,008
9.3 Advances include Rs. 86,013.024 million (2020: Rs. 83,623.743 million) which have been placed under non-performing status
as detailed below:
2021 2020
Non- Non-
Performing Provision Performing Provision
Category of Classification Loans Loans
--------------------------------------------------------------------------- (Rupees in '000) --------------------------------------------
Domestic
Other Assets Especially Mentioned * 155,903 - 189,538 497
Substandard 2,398,883 595,091 2,690,171 662,589
Doubtful 563,051 346,746 1,599,695 798,209
Loss 23,945,768 22,853,989 24,259,582 23,164,558
27,063,605 23,795,826 28,738,986 24,625,853
Overseas
Not past due but impaired ** 4,207,043 1,233,410 6,724,892 2,811,988
Overdue by:
Upto 90 days 1,004,416 303,038 160,631 4,833
91 to 180 days 1,811,745 1,620,231 5,232,868 4,695,361
181 to 365 days 4,666,129 3,620,254 6,841,381 6,407,521
˃ 365 days 47,260,086 44,131,098 35,924,985 33,210,112
58,949,419 50,908,031 54,884,757 47,129,815
Total 86,013,024 74,703,857 83,623,743 71,755,668
* The Other Assets Especially Mentioned category pertains to agriculture and small enterprises financing.
** Not past due but impaired category mainly represents restructured exposures.
9.4 Particulars of provision against advances

2021 2020
Note Specific General Total Specific General Total
--------------------------------------------------------------------------- (Rupees in '000) ----------------------------------------------------------------
Opening balance 71,755,668 7,271,844 79,027,512 63,615,915 3,501,359 67,117,274

Exchange adjustments 5,068,084 734,361 5,802,445 917,623 155,659 1,073,282
Charge for the year 4,901,313 361,989 5,263,302 14,394,123 3,623,212 18,017,335
Reversals for the year (3,048,379) (974,933) (4,023,312) (1,805,805) (8,386) (1,814,191)
Net charge / (reversal) against advances 32 1,852,934 (612,944) 1,239,990 12,588,318 3,614,826 16,203,144
Amounts charged off -

agriculture financing 9.5 (257,446) - (257,446) (80,974) - (80,974)
Amounts written off 9.6 (3,711,835) - (3,711,835) (5,282,212) - (5,282,212)
Transfers out - net (3,548) - (3,548) (3,002) - (3,002)
Closing balance 74,703,857 7,393,261 82,097,118 71,755,668 7,271,844 79,027,512
26
9.4.1 Particulars of provision against advances

2021 2020
Specific General Total Specific General Total
------------------------------------------------ (Rupees in '000) ------------------------------------------------
In local currency 23,205,037 402,418 23,607,455 24,085,365 319,955 24,405,320
In foreign currencies 51,498,820 6,990,843 58,489,663 47,670,303 6,951,889 54,622,192
74,703,857 7,393,261 82,097,118 71,755,668 7,271,844 79,027,512
9.4.2 General provision represents provision amounting to Rs. 402.418 million (2020: Rs. 319.955 million) against consumer
finance portfolio as required by the Prudential Regulations issued by the SBP and Rs. 6,990.843 million (2020: Rs.
6,951.889 million) pertaining to overseas advances to meet the requirements of the regulatory authorities of the respective
countries in which the overseas branches operate.
9.4.3 The Bank has availed the benefit of Forced Sale Value (FSV) of certain mortgaged properties held as collateral against non-
performing advances as allowed under BSD Circular 1 of 2011. Had the benefit under the said circular not been taken by
the Bank, the specific provision against non-performing advances would have been higher by Rs. 16.258 million (2020: Rs.
18.337 million).
The Bank has also availed FSV benefit of certain mortgaged properties held as collateral against non-performing advances
of overseas branches in accordance with the applicable regulations in the respective countries where the branches
operate. Had the benefit not been taken by the Bank, the specific provision against non-performing advances would have
been higher by Rs. 3,528.942 million (2020: Rs. 3,951.861 million) for the overseas branches.
The FSV benefit availed is not available for the distribution of cash or stock dividend to shareholders.
9.5 These represent non-performing advances for agriculture financing which have been classified as loss, are fully provided
and are in default for more than 3 years. These non-performing advances have been charged off by extinguishing them
against the provision held in accordance with the SBP's Prudential Regulations for Agriculture Financing. This charge off
does not, in any way, prejudice the Bank's right of recovery from these customers.
Note 2021 2020
9.6 Particulars of write-offs ------- (Rupees in '000) -------
9.6.1 Against provisions 9.4 3,711,835 5,282,212

Directly charged to profit and loss account 42,643 77,094
3,754,478 5,359,306
9.6.2 Write-offs of Rs. 500,000 and above
- Domestic 9.7 171,013 2,663,181
- Overseas 3,534,481 2,629,279
3,705,494 5,292,460
Write-offs of below Rs. 500,000 48,984 66,846
3,754,478 5,359,306
9.7 Details of loan write-offs of Rs. 500,000 and above
In terms of sub-section (3) of Section 33A of the Banking Companies Ordinance, 1962, the statement in respect of written
off loans or any other financial relief of five hundred thousand rupees or above allowed to a person during the year ended
December 31, 2021, is given in annexure I and is an integral part of these unconsolidated financial statements (except in
case of overseas branches which is restricted by overseas regulatory authorities).
9.8 Information related to Islamic financing and related assets is given in annexure II and is an integral part of these
unconsolidated financial statements.
Note 2021 2020
10. FIXED ASSETS ------- (Rupees in '000) -------
Capital work-in-progress 10.1 1,294,646 447,893

Property and equipment 10.2 67,243,007 50,759,810
68,537,653 51,207,703
10.1 Capital work-in-progress
Civil works 419,443 270,445

Equipment 875,203 177,448
1,294,646 447,893
27
10.2 Property and Equipment
2021
Buildings Buildings Electrical,
Leasehold Furniture
Freehold Leasehold on on office and Right-of-
Improve- and Vehicles Total
land land Freehold Leasehold computer use Assets
ments fixtures
land land equipment
----------------------------------------------------------------------------------------- (Rupees in '000) -----------------------------------------------------------------------------------------
At January 01, 2021
Cost / Revalued amount 6,433,625 21,468,648 2,790,183 6,797,040 5,786,556 2,187,778 15,455,565 314,148 9,558,101 70,791,644
Accumulated depreciation - - (252,595) (743,991) (3,287,316) (1,366,937) (11,281,161) (226,466) (2,873,368) (20,031,834)
Net book value 6,433,625 21,468,648 2,537,588 6,053,049 2,499,240 820,841 4,174,404 87,682 6,684,733 50,759,810
Year ended December 31, 2021

Opening net book value 6,433,625 21,468,648 2,537,588 6,053,049 2,499,240 820,841 4,174,404 87,682 6,684,733 50,759,810
Additions - - - - 459,781 119,247 1,840,683 117,007 3,007,028 5,543,746
Movement in surplus on assets revalued
during the year 3,110,038 10,622,829 920,324 1,758,687 - - - - - 16,411,878
Disposals - - - (4,726) (14,940) (250) (5,766) (8,130) (701,200) (735,012)
Depreciation charge - - (88,453) (256,861) (462,222) (153,021) (1,844,679) (43,779) (1,928,943) (4,777,958)
Exchange rate adjustments - 25 - 852 13,508 566 24,145 141 10,777 50,014
Other adjustments / transfers - 8 - 79 (2,162) (2,781) (8,910) 30 4,265 (9,471)
Closing net book value 9,543,663 32,091,510 3,369,459 7,551,080 2,493,205 784,602 4,179,877 152,951 7,076,660 67,243,007
At December 31, 2021

Accumulated depreciation - - - (11,641) (3,673,899) (1,491,180) (13,015,474) (221,893) (3,769,965) (22,184,052)
Net book value 9,543,663 32,091,510 3,369,459 7,551,080 2,493,205 784,602 4,179,877 152,951 7,076,660 67,243,007
- - - - - - - - -
Rate of depreciation (%) - - 2.5-5 2.5-5 5-20 10-25 5 - 33.33 20 4 - 100
2020
Buildings Buildings Electrical,
Leasehold Furniture
Freehold Leasehold on on office and Right-of-
Improve- and Vehicles Total
land land Freehold Leasehold computer use Assets
ments fixtures
land land equipment
----------------------------------------------------------------------------------------- (Rupees in '000) -----------------------------------------------------------------------------------------
At January 01, 2020
Net book value 6,433,625 21,513,568 2,626,041 6,429,892 2,481,003 895,047 4,244,267 141,737 7,089,976 51,855,156
Year ended December 31, 2020

Opening net book value 6,433,625 21,513,568 2,626,041 6,429,892 2,481,003 895,047 4,244,267 141,737 7,089,976 51,855,156
Additions - - - - 478,528 92,708 1,744,741 4,950 2,188,391 4,509,318
Disposals - (44,930) - (118,811) (3,484) (5,586) (4,206) (13,359) (944,932) (1,135,308)
Depreciation charge - - (88,453) (258,431) (460,901) (161,636) (1,817,601) (45,953) (1,655,038) (4,488,013)
Exchange rate adjustments - - - 316 4,354 614 8,158 324 6,336 20,102
Other adjustments / transfers - 10 - 83 (260) (306) (955) (17) - (1,445)
Closing net book value 6,433,625 21,468,648 2,537,588 6,053,049 2,499,240 820,841 4,174,404 87,682 6,684,733 50,759,810
At December 31, 2020

Net book value 6,433,625 21,468,648 2,537,588 6,053,049 2,499,240 820,841 4,174,404 87,682 6,684,733 50,759,810
- - - - - - - - - -
Rate of depreciation (%) - - 2.5-5 2.5-5 5-20 10-25 5 - 33.33 20 4 - 100
28
10.3 Revaluation of properties
The properties of the Bank have been revalued by independent professional valuers as at December 31, 2021. The
revaluation was carried out by M/s. Engineering Pakistan International (Private) Limited, M/s. M. J. Surveyors (Private)
Limited, and M/s. Perfect Consultants on the basis of professional assessment of present market values which resulted in
an increase in surplus by Rs. 16,411.878 million. The total surplus against revaluation of fixed assets as at December 31,
2021, amounts to Rs. 41,764.572 million.
Had there been no revaluation, the carrying amount of the revalued assets at December 31, would have been as follows:
2021 2020
------- (Rupees in '000) -----
Freehold land 782,581 782,581

Leasehold land 3,397,652 3,330,789
Buildings on freehold land 1,970,022 1,990,873
Buildings on leasehold land 4,640,885 4,757,850
10,791,140 10,862,093
10.4 Carrying amount of temporarily idle properties of the Bank 82,420 143,420
10.5 The cost of fully depreciated assets that are still in the Bank's use are as follows:
Furniture and fixtures 561,051 476,007

Electrical, office and computer equipment 7,507,420 6,235,542
Vehicles 120,125 118,403
Leasehold improvements 1,116,951 831,886
9,305,547 7,661,838
10.6 Details of disposal of operating fixed assets to related parties
The information relating to operating fixed assets disposed off during the year to related parties is given in annexure III and
is an integral part of these unconsolidated financial statements.
Note 2021 2020

11. INTANGIBLE ASSETS ------- (Rupees in '000) -----
Capital work-in-progress - Computer software 604,751 190,355

Intangible assets 11.1 1,626,514 1,638,856
2,231,265 1,829,211
11.1 Intangible assets
Computer Software
At January 01,
Cost 6,554,387 5,875,765
Accumulated amortisation (4,915,531) (4,187,167)
Net book value 1,638,856 1,688,598
Year ended December 31,

Opening net book value 1,638,856 1,688,598
Additions - directly purchased 776,946 742,731
Disposals (981) (1,324)
Amortisation charge (801,197) (793,562)
Exchange rate adjustments 12,931 2,413
Other adjustments (41) -
Closing net book value 1,626,514 1,638,856
At December 31,
Cost 7,131,567 6,554,387
Accumulated amortisation (5,505,053) (4,915,531)
Net book value 1,626,514 1,638,856
Rate of amortisation (%) 10 - 25 10 - 25
Useful life (in years) 4 - 10 4 - 10
29
11.2 The cost of fully amortised intangible assets that are still in the Bank's use amounted to Rs. 2,985.136 million (2020: Rs.
2,297.088 million).
12. DEFERRED TAX ASSETS 2021

Recognised in
At January 01, Recognised in At December
profit and loss
2021 OCI 31, 2021
account
------------------------------------------------- (Rupees in '000) -------------------------------------------------
Deductible temporary differences on
- Post retirement employee benefits 1,381,087 92,722 (757,004) 716,805
- Provision against advances, off balance sheet etc. 6,390,263 (1,217,961) - 5,172,302
- Workers' Welfare Fund 1,833,191 398,551 - 2,231,742
9,604,541 (726,688) (757,004) 8,120,849
Taxable temporary differences on:
- Surplus on revaluation of fixed assets / non-banking assets (646,666) 30,134 (1,067,415) (1,683,947)
- Surplus on revaluation of investments (1,697,416) - 3,002,318 1,304,902
- Accelerated tax depreciation (729,569) 155,636 - (573,933)
- Others (131,623) - 168,027 36,404
(3,205,274) 185,770 2,102,930 (916,574)
6,399,267 (540,918) 1,345,926 7,204,275
2020
Recognised in
At January 01, Recognised in At December
profit and loss
2020 OCI 31, 2020
account
------------------------------------------------- (Rupees in '000) -------------------------------------------------
Deductible temporary differences on:
- Post retirement employee benefits 837,307 30,335 513,445 1,381,087
- Provision against advances, off balance sheet etc. 3,291,876 3,098,387 - 6,390,263
- Workers' Welfare Fund 1,495,858 337,333 - 1,833,191
5,625,041 3,466,055 513,445 9,604,541
Taxable Temporary Differences on:
- Surplus on revaluation of fixed assets / non-banking assets (739,593) 33,079 59,848 (646,666)
- Surplus on revaluation of investments (417,813) - (1,279,603) (1,697,416)
- Accelerated tax depreciation (1,147,656) 418,087 - (729,569)
- Others (19,815) - (111,808) (131,623)
(2,324,877) 451,166 (1,331,563) (3,205,274)
3,300,164 3,917,221 (818,118) 6,399,267
Note 2021 2020

13. OTHER ASSETS ------- (Rupees in '000) -------
Income / mark-up accrued in local currency 25,128,445 21,075,804

Income / mark-up accrued in foreign currencies 13.1 2,771,265 2,117,215
Advance taxation - net of provision for taxation 13.2 4,144,088 5,921,083
Receivable from staff retirement fund 37.4 2,077,069 -
Receivable from other banks against telegraphic transfers and demand drafts 365,000 110,689
Unrealised gain on forward foreign exchange contracts 4,069,229 2,703,865
Rebate receivable - net 652,112 631,410
Unrealised gain on derivative financial instruments 23.1 8,476 -
Suspense accounts 158,508 51,215
Stationery and stamps on hand 206,616 169,311
Non-banking assets acquired in satisfaction of claims 13.3 196,640 201,820
Advances, deposits, advance rent and other prepayments 1,177,703 916,276
Acceptances 19 11,421,246 10,505,651
Dividend Receivable - 217,974
Commission Receivable - Branchless Banking 676,483 658,524
Commission Receivable - Bancassurance 111,180 144,063
Receivable against fraud & forgery and looted notes 564,693 586,929
Others 1,877,987 1,695,211
55,606,740 47,707,040
Less: Provision held against other assets 13.4 (1,163,055) (1,392,976)
Other assets - net of provisions 54,443,685 46,314,064
Surplus on revaluation of non-banking assets acquired in
satisfaction of claims 21.2 16,704 1,496
Other assets - total 54,460,389 46,315,560
30
13.1 Unrealised mark-up held in suspense amounting to Rs. 16,929.481 million (2020: Rs. 13,639.898 million) against non-
performing overseas advances has been netted off.
13.2 The Income Tax returns of the Bank have been filed upto the tax year 2021 (financial year ended December 31, 2020) and
were deemed to be assessed under section 120 of the Income Tax Ordinance, 2001 (Ordinance).
The income tax authorities have issued amended assessment orders for the tax years 2003 to 2020, and created additional
tax demands (including disallowances of provisions made prior to Seventh Schedule) of Rs.13,752 million (2020:
Rs.11,610 million). The Bank has filed appeals before the various appellate forums against these amendments. Where the
appellate authorities have allowed relief on certain issues, the assessing authorities have filed appeals before higher
appellate forums. Where the appellate authorities have not allowed relief the Bank has filed appeals before higher
appellate forums. The management of the Bank is confident that the appeals will be decided in favour of the Bank.
The tax returns for Azad Jammu and Kashmir (AJK) and Gilgit Baltistan (GB) Branches have been filed upto the tax year
2021 (financial year ended December 31, 2020) under the provisions of section 120(1) read with section 114 of the
Ordinance and in compliance with the terms of the agreement between banks and the Azad Kashmir Council in May 2005.
The returns filed are considered as deemed assessment orders under the law.
The tax authorities have also carried out monitoring for Federal Excise Duty, Sales tax and withholding taxes covering
period from year ended 2005 to 2019. Consequently various addbacks and demands were raised creating a total demand
of Rs. 2,632 million (2020: Rs. 1,274 million). The Bank has filed appeals against all such demands and is confident that
these would be decided in the favor of the Bank.
The tax returns for Yemen have been filed upto the year ended December 31, 2019 and for UAE and Qatar branches upto
the year ended December 31, 2020 under the provisions of the laws prevailing in the respective countries, and are deemed
as assessed unless opened for reassessment.
The Bank has received corrective tax assessment of QAR 642 thousand (Rs. 31.117 million) from the General tax Authority
(GTA) in respect of tax year 2015. Management has filed an appeal against the said penalty and is confident that the
matters will be decided in favor of the Bank and the possibility of any outcome against it is remote.
2021 2020
------- (Rupees in '000) -------
13.3 Market value of Non-banking assets acquired in satisfaction of claims 213,344 203,316
13.3.1 Non-banking assets acquired in satisfaction of claims have been revalued by independent professional valuers as at
December 31, 2021. The revaluation was carried out by M/s. Asif Associates (Private) Limited and M/s. M.J. Surveyors
(Private) Limited on the basis of an assessment of present market values and resulted in an increase of Rs. 15.208 million
in the surplus.
2021 2020
13.3.2 Non-banking assets acquired in satisfaction of claims ------- (Rupees in '000) -------
Opening balance 203,316 1,051,858

Additions - -
Revaluation during the year 15,208 (1,509)
Disposals - (846,541)
Depreciation (5,180) -
Impairment - (268)
Other adjustments - (224)
Closing balance 213,344 203,316
31
Note 2021 2020

13.3.3 Gain on disposal of Non-banking assets acquired in satisfaction of claims ------- (Rupees in '000) -------
Disposal proceeds - 1,038,100

Less:
- Cost - 798,610
- Surplus - 47,931
- 846,541
Gain - 191,559
13.4 Provision held against other assets
Advances and other receivables 54,674 84,272

Receivable against fraud & forgery and looted notes 564,693 586,929
Others 543,688 721,775
1,163,055 1,392,976
13.4.1 Movement in provision held against other assets

Exchange adjustments 28,541 655

32 (168,605) 154,855
Transfers (out) / in - net (41,160) 3,245
Amounts written off (48,697) (37,656)
Closing balance 1,163,055 1,392,976
14. CONTINGENT ASSETS
There were no contingent assets as at December 31, 2021 (2020: Nil).
15. BILLS PAYABLE
In Pakistan 25,898,903 28,820,012

Outside Pakistan 894,067 913,801
26,792,970 29,733,813
16. BORROWINGS
Secured
Borrowings from State Bank of Pakistan under:
Export refinance scheme 16.2 38,881,750 30,681,990
Refinance facility for modernization of SME 16.3 5,100 3,955
Long term financing facility 16.4 20,056,964 22,243,644
Refinance scheme for payment of wages and salaries 16.5 3,225,644 5,587,037
Renewable energy scheme 16.6 513,403 146,985
Temporary economic refinance facility 16.7 9,972,210 307,540
Refinance facility for combating COVID-19 16.8 390,962 460,666
Repurchase agreement borrowings 16.9 417,755,950 -
Refinance for Women Entrepreneurs 16.10 18,487 42,184
490,820,470 59,474,001
Repurchase agreement borrowings from other banks 16.11 54,783,321 59,835,819
545,603,791 119,309,820
Unsecured
Call borrowings 16.12 15,885,337 2,397,485
Overdrawn nostro accounts 1,795,622 356,029
Money market deals - 6,924,081
17,680,959 9,677,595
563,284,750 128,987,415
32
2021 2020
16.1 Particulars of borrowings with respect to currencies ------- (Rupees in '000) -------

In foreign currencies 17,680,959 9,677,595
563,284,750 128,987,415
16.2 The Bank has entered into an agreement with the SBP for extending export finance to customers. As per the terms of the
agreement, the Bank has granted the SBP the right to recover the outstanding amounts from the Bank at the date of
maturity of the finances by directly debiting the Bank's current account maintained with the SBP. These borrowings are
repayable within six months, latest by June 2022. These carry mark-up at rates ranging from 1.00% to 2.00% (2020: 1.00%
to 2.00%) per annum.
16.3 These borrowings have been obtained from the SBP under a scheme to finance modernization of Small and Medium
Enterprises by providing financing facilities for setting up of new units, purchase of new plant and machinery for Balancing,
Modernization and Replacement (BMR) of existing units and financing for import / local purchase of new generators upto a
maximum capacity of 500 KVA. These borrowings are repayable latest by November 2028 and carry mark-up at rates of
2.00% (2020: 1.00%) per annum.
16.4 These borrowings have been obtained from the SBP for providing financing facilities to exporters for adoption of new
technologies and modernization of their plant and machinery. These borrowings are repayable latest by September 2031.
These carry mark-up at rates ranging from 2.00% to 9.70% (2020: 2.00% to 9.70%) per annum.
16.5 In order to dampen effects of COVID-19, the State Bank of Pakistan has introduced conventional and islamic temporary
refinance schemes for payment of wages and salaries to the workers and employees of the business concerns. These
borrowings are repayable latest by January 2023. These carry mark-up / profit at rates ranging from 0.00% to 1.00% (2020:
0.00% to 3.00%) per annum.
16.6 These borrowings have been obtained from the SBP for providing financing facilities to address challenges of energy
shortage and climate change through promotion of renewable energy. These borrowings are repayable latest by November
2031. These carry mark-up at rates ranging from 2.00% to 3.00% (2020: 3.00% to 4.00%) per annum.
16.7 These borrowings have been obtained from the SBP under a scheme to provide concessionary refinance for setting up of
new industrial units in the backdrop of challenges being faced by industries post pandemic scenerio. These carry mark-up
at rates ranging from 1.00% to 1.25% (2020: 1.00%) per annum and are due to mature latest by December 2031.
16.8 These borrowings have been obtained from the SBP under a scheme to provide the emergency refinance facility to
hospitals & medical centre to develop capacity for the treatment of COVID-19 patients. These carry mark-up at 0.00%
(2020: 0.00%) per annum and are due to mature latest by June 2025.
16.9 These represent repurchase agreement borrowing from SBP at rates ranging from 9.95% to 10.07% per annum having
maturity upto March 2022. The market value of securities given as collateral against these borrowings is given in note
8.2.1.
16.10 These borrowings have been obtained from the SBP under a scheme to provide refinance for women entrepreneurs in the
underserved areas of the country. These carry mark-up at 0.00% (2020: 0.00%) per annum and are due to mature latest by
September 2026.
16.11 These repurchase agreement borrowings from other banks are secured against Pakistan Investment Bonds and Market
Treasury Bills and carry mark-up at rates ranging from 9.75% to 10.70% (2020: 6.05% to 7.00%) per annum. These
borrowings are repayable latest by January 2022. The market value of securities given as collateral against these
borrowings is given in note 8.2.1.
16.12 These are unsecured borrowings carrying mark-up at rates ranging from 1.20% to 2.09% (2020: 1.50%) per annum, and
are repayable latest by June 2022.
33
17. DEPOSITS AND OTHER ACCOUNTS
2021 2020
In Local In Foreign In Local In Foreign
Total Total
Currency Currencies Currency Currencies
---------------------------------------------------------------------------------
Note (Rupees in '000) ---------------------------------------------------------------------------------
Customers
Current accounts - remunerative 2,528,236 6,001,961 8,530,197 1,387,144 5,240,221 6,627,365
Current accounts - non-remunerative 633,109,393 117,505,435 750,614,828 549,419,858 111,464,961 660,884,819
Savings deposits 574,380,924 48,883,320 623,264,244 509,712,356 48,079,084 557,791,440
Term deposits 134,138,693 135,909,226 270,047,919 171,340,589 123,785,587 295,126,176
Sundry deposits 9,313,881 1,283,385 10,597,266 5,022,037 1,750,251 6,772,288
Margin deposits 4,356,837 3,149,326 7,506,163 3,833,926 3,164,625 6,998,551
1,357,827,964 312,732,653 1,670,560,617 1,240,715,910 293,484,729 1,534,200,639
Financial Institutions
Current deposits 35,723,146 3,186,112 38,909,258 20,978,533 1,941,161 22,919,694
Savings deposits 16,824,931 54,784 16,879,715 56,409,524 42,544 56,452,068
Term deposits 18,612,650 5,981,525 24,594,175 25,207,956 1,431,544 26,639,500
71,160,727 9,222,421 80,383,148 102,596,013 3,415,249 106,011,262
17.2 1,428,988,691 321,955,074 1,750,943,765 1,343,311,923 296,899,978 1,640,211,901
2021 2020
17.1 Composition of deposits ------------ (Rupees in '000) ---------
- Individuals 998,444,542 922,086,776

- Government (Federal and Provincial) 136,084,730 96,121,321
- Public Sector Entities 100,639,787 114,365,057
- Banking Companies 29,086,274 14,233,880
- Non-Banking Financial Institutions 51,296,874 91,777,382
- Private Sector 435,391,558 401,627,485
1,750,943,765 1,640,211,901
17.2 This includes deposits eligible to be covered under insurance arrangements in accordance with DPC Circular No. 04 dated
June 22, 2018, amounting to Rs. 1,078,654.532 million (2020: Rs. 991,687.959 million).
18. SUBORDINATED DEBT
The Bank has issued fully paid up, rated, listed, perpetual, unsecured, subordinated, non-cumulative and contingent
convertible debt instruments in the nature of Term Finance Certificates (TFCs) under Section 66 of the Companies Act,
2017 which qualify as Additional Tier I Capital as outlined by State Bank of Pakistan (SBP) under BPRD Circular No. 6
dated August 15, 2013.
Salient features of the Additional Tier 1 issue are as follows:
Issue Size Rs. 10,000 million

Issue Date January 29, 2019
Tenor Perpetual (i.e. no fixed or final redemption date)
Rating “AA+” (Double A Plus) by VIS Credit Rating Company Limited
Security Unsecured
Mark-up rate The TFCs shall carry mark-up at the rate of 3 Month KIBOR + 1.55%.
Mark-up payment frequency Mark-up shall be payable quarterly in arrears, on a non-cumulative basis.
The Bank may, at its sole discretion, call the TFCs, at any time after five years from the Issue Date subject
Call option
to the prior approval of the SBP.
Mark-up on the TFCs shall only be paid from the current year's earnings and if the Bank is fully compliant
Lock-in clause with SBP’s Minimum Capital Requirement (MCR), Capital Adequacy Ratio (CAR) and Liquidity Ratio (LR)
requirements.
The TFCs shall, at the discretion of the SBP, be either permanently converted into ordinary shares or
permanently written off (partially or in full) pursuant to the loss absorbency clause as stipulated in the
Loss absorbency clause
“Instructions for Basel III Implementation in Pakistan” issued vide BPRD Circular No. 6 dated August 15,
2013.
34
Note 2021 2020

19. OTHER LIABILITIES ------------- (Rupees in '000) -------------
Mark-up / return / interest payable in local currency 15,032,556 11,628,846

Mark-up / return / interest payable in foreign currencies 863,563 1,306,907
Accrued expenses 4,416,101 4,052,238
Branch adjustment account 479,517 105,228
Deferred income 19.4 997,320 882,954
Unearned commission and income on bills discounted 231,988 437,621
Provision against off-balance sheet obligations 19.1 730,630 1,065,233
Unrealised loss on forward foreign exchange contracts 1,156,024 3,318,593
Liability against trading of securities 1,521,590 -
Provision for post-retirement medical benefits 37.4 2,175,874 2,028,687
Payable to staff retirement fund 37.4 103,685 1,118,539
Provision for compensated absences 835,134 954,555
Deferred liabilities 19.2 590,579 769,005
Workers' Welfare Fund payable 30 5,522,416 4,700,490
Liabilities against ATM settlement 40,996 1,199,242
Insurance payable against consumer assets 477,866 427,257
Dividends payable 2,762,515 118,317
Unclaimed dividends 292,141 239,261
Acceptances 13 11,421,246 10,505,651
Charity fund balance 4,039 2,827
Lease liability against right-of-use assets 19.3 8,412,023 7,776,503
Levies and taxes payable 3,017,195 2,666,232
Others 1,416,877 1,081,458
62,501,875 56,385,644
19.1 Provision against off-balance sheet obligations
Opening balance 1,065,233 622,264


32 (344,250) 431,749
Transfers out - net (5,280) -
Closing balance 19.1.1 730,630 1,065,233
19.1.1 This represents provision recognised against guarantees of non-performing customers.
19.2 Deferred liabilities
Deferred liability - overseas branches 458,228 540,999

Deferred liability - outsourced services 132,351 228,006
590,579 769,005
19.3 The total cash outflow for leases during the year was Rs. 2,649.400 million (2020: Rs. 2,174.025 million).
19.4 This includes deferred income of IFRS 15 "Revenue from Contracts with Customers" on account of fee of debit and credit
cards, guarantee commission and locker rent.
20. SHARE CAPITAL
20.1 Authorised Capital
2021 2020 2021 2020

(Number of shares) ------------- (Rupees in '000) -------------
2,000,000,000 2,000,000,000 Ordinary shares of Rs. 10 each 20,000,000 20,000,000
35
20.2 Issued, subscribed and paid-up capital
2021 2020 2021 2020

(Number of shares) ------------- (Rupees in '000) -------------
Fully paid-up ordinary shares of Rs. 10 each
518,000,000 518,000,000 Issued for cash 5,180,000 5,180,000
706,179,687 706,179,687 Issued as bonus shares 7,061,797 7,061,797
1,224,179,687 1,224,179,687 12,241,797 12,241,797
20.3 In 2007, the Bank was admitted to the official list of the UK Listing Authority and to the London Stock Exchange
Professional Securities Market for trading of Global Depository Receipts (GDRs), each representing four ordinary shares
issued by the Bank. The GDRs constitute an offering in the United States only to qualified institutional buyers in reliance on
Rule 144A under the U.S Securities Act of 1933 and an offering outside the United States in reliance on Regulation S.
Holders of GDRs are entitled, subject to the provisions of the depository agreement, to receive dividends, if any, and rank
pari passu with other equity shareholders in respect of such entitlement. However, the holders of GDRs have no voting
rights or other direct rights of shareholders with respect to the ordinary shares underlying such GDRs. Subject to the terms
and restrictions set out in the offering circular dated June 25, 2007, the deposited ordinary shares in respect of which the
GDRs were issued may be withdrawn by the GDR holders from the depository facility. Upon withdrawal, the holders will
rank pari passu with other ordinary shareholders in respect of voting powers. As at December 31, 2021, 242,278 (2020:
242,278) GDRs representing 969,112 (2020: 969,112) shares are in issue.
20.4 Major shareholders (holding more than 5% of total paid-up capital)
2021 2020
Number of Percentage of Number of Percentage of
Name of shareholder shares held shareholding shares held shareholding
Bestway (Holdings) Limited - - 631,728,895 51.60%

Bestway International Holdings Limited 631,728,895 51.60% - -
Bestway Cement Limited 93,649,744 7.65% 93,649,744 7.65%
During the year, an internal reorganisation exercise was undertaken by the Bestway Group as detailed in note 1 to these
unconsolidated financial statements. As at December 31, 2021, Bestway Group (Bestway) held 61.48% (2020: 61.48%)
shareholding (including GDRs) of the Bank.
2021 2020
20.5 Shares of the Bank held by its associates ---------- (Number of shares) ----------
UBL Financial Sector Fund 1,409,693 1,616,986
Note 2021 2020

------------- (Rupees in '000) -------------
21. SURPLUS ON REVALUATION OF ASSETS
(Deficit) / Surplus arising on revaluation of:

- Available for sale securities 8.1 (3,345,902) 4,352,348
- Fixed assets 21.1 41,764,572 25,630,817
- Non-banking assets acquired in satisfaction of claims 21.2 16,704 1,496
38,435,374 29,984,661
Deferred tax on (deficit) / surplus on revaluation of:
- Available for sale securities 12 (1,304,902) 1,697,416
- Fixed assets 21.1 1,677,432 646,083
- Non-banking assets acquired in satisfaction of claims 21.2 6,515 583
379,045 2,344,082
38,056,329 27,640,579
36
Note 2021 2020

------------- (Rupees in '000) -------------
21.1 Surplus on revaluation of fixed assets
Surplus on revaluation of fixed assets as at January 01, 25,630,817 25,872,298

Recognised during the year 16,214,990 -
Realised on disposal during the year (4,804) (162,824)
Transferred to unappropriated profit in respect of incremental
depreciation - net of deferred tax (48,298) (51,893)
Related deferred tax liability on incremental depreciation (30,879) (33,177)
Surplus on revaluation of fixed assets as at December 31, 41,764,572 25,630,817
Less: Related deferred tax liability on

- Revaluation as at January 01, 646,083 719,728
- Revaluation recognised during the year 1,044,814 -
- Surplus realised on disposal of fixed assets during the year (1,689) (46,478)
- Other adjustments 18,032 -
- Exchange adjustments 1,071 6,010
- Incremental depreciation charged during the year (30,879) (33,177)
- Revaluation as at December 31, 1,677,432 646,083
40,087,140 24,984,734
21.2 Surplus on revaluation of non-banking assets
Surplus on revaluation of non-banking assets as at January 01, 1,496 50,936

Revaluation of non-banking assets during the year 15,208 (1,509)
Realised on disposal during the year - (47,931)
Surplus on revaluation of non-banking assets as at December 31, 16,704 1,496
Less: Related deferred tax liability on

- Revaluation as at January 01, 583 19,865
- Revaluation of non-banking assets during the year 5,932 (588)
- Surplus realised on disposal of non-banking assets during the year - (18,694)
- Revaluation as at December 31, 6,515 583
10,189 913
22. CONTINGENCIES AND COMMITMENTS
Guarantees 22.1 167,884,838 147,936,161

Commitments 22.2 947,939,838 891,767,423
Other contingent liabilities 22.3 16,452,188 15,539,628
1,132,276,864 1,055,243,212
37
Note 2021 2020

------------- (Rupees in '000) -------------
22.1 Guarantees:
Financial guarantees 55,725,856 43,029,347

Performance guarantees 107,821,730 99,909,261
Other guarantees 4,337,252 4,997,553
167,884,838 147,936,161
22.2 Commitments:
Documentary credits and short-term trade-related transactions

- letters of credit 169,653,706 137,787,140
Commitments in respect of:

- forward foreign exchange contracts 22.2.2 652,382,419 635,597,333
- forward government securities transactions 22.2.3 11,780,000 -
- derivatives 22.2.4 1,808,940 -
- forward lending 22.2.5 109,605,370 115,451,442
- operating leases 22.2.6 99,911 55,009
775,676,640 751,103,784
Commitments for acquisition of:
- fixed assets 1,049,017 2,038,561
- intangible assets 1,560,475 837,938
2,609,492 2,876,499
947,939,838 891,767,423
22.2.1 Commitments to extend credit
The Bank makes commitments to extend credit in the normal course of its business but these being revocable
commitments do not attract any significant penalty or expense if the facility is unilaterally withdrawn.
Note 2021 2020

------------- (Rupees in '000) -------------
22.2.2 Commitments in respect of forward foreign
exchange contracts
Purchase 350,490,749 342,792,602

Sale 301,891,670 292,804,731
652,382,419 635,597,333
22.2.3 Commitments in respect of forward government

securities transactions
Purchase 23.1 9,081,000 -

Sale 23.1 2,699,000 -
11,780,000 -
38
Note 2021 2020

22.2.4 Commitments in respect of derivatives ------------- (Rupees in '000) -------------
FX options
Purchase 23.1 904,470 -
Sale 23.1 904,470 -
1,808,940 -
22.2.5 Commitments in respect of forward lending
Undrawn formal standby facilities, credit lines and

other commitments to lend 22.2.5.1 63,017,022 57,591,623
Others 46,588,348 57,859,819
109,605,370 115,451,442
22.2.5.1 These represent commitments that are irrevocable because they cannot be withdrawn at the discretion of the Bank
without the risk of incurring significant penalty or expense.
Note 2021 2020

------------- (Rupees in '000) -------------
22.2.6 Commitments in respect of operating leases
Not later than one year 99,661 50,579

Later than one year and not later than five years 22 4,197
Later than five years 228 233
99,911 55,009
22.3 Other contingencies
22.3.1 Claims against the Bank not acknowledged as debts 22.3.2 12,362,885 11,450,325
These mainly represent counter claims filed by the borrowers for restricting the Bank from disposal of assets (such as
mortgaged / pledged assets kept as security).
Based on legal advice and / or internal assessments, management is confident that the matters will be decided in the
Bank's favour and the possibility of any outcome against the Bank is remote and accordingly no provision has been made
in these unconsolidated financial statements.
22.3.2 During 2016, penalties amounting to Rs. 4.089 billion were levied by the FE Adjudication Court of the State Bank of
Pakistan relating to alleged contraventions of the requirements of foreign exchange regulations with respect to issuance
and certification of E-Forms by the Bank to certain customers (exporters) who failed to submit the export documents there
against. Consequently, foreign exchange on account of export proceeds have not been repatriated. The Bank maintains
that it fully discharged its liability, in accordance with the law and has filed a civil suit in the High Court of Sindh
challenging the levy of the penalty. The High Court has granted a stay on action being taken against the Bank. The
management, based on the advice from legal counsel, is confident that the view of the Bank will prevail and the Bank will
not be exposed to any loss on this account.
22.3.3 For contingencies relating to taxation, refer note 13.2.
23. DERIVATIVE INSTRUMENTS
Derivatives are a type of financial contract, the value of which is determined by reference to one or more underlying
assets or indices. The major categories of such contracts include forwards, futures, swaps and options. Derivatives also
include structured financial products that have one or more of the characteristics of forwards, futures, swaps and options.
The Bank, as an Authorised Derivative Dealer (ADD), is an active participant in the Pakistan derivatives market and offers
a wide variety of derivatives products covering both hedging and market making to satisfy customers’ needs. Where
required, specific approval is sought from the SBP for each transaction.
The Risk management policy related to derivatives is discussed in note 45.8
39
23.1 Product analysis

2021
Forward purchase Forward sale contracts

Interest rate swaps FX options contracts of of Government Total
Counterparties
Government Securities Securities
Mark to Mark to Mark to Mark to Mark to

Notional Notional Notional Notional Notional
market market market market market
principal principal principal principal principal
gain gain gain gain gain
------------------------------------------------------------------------------------------------------------------------------------------- (Rupees in '000) ---------------------------------------------------------------------------------------------------------

With banks for
Hedging - - 904,470 - - - 2,500,000 55 3,404,470 55
Market making - - - - - - - - - -
- - 904,470 - - - 2,500,000 55 3,404,470 55
With FIs other than Banks for
Hedging - - - - - - 199,000 1,047 199,000 1,047
Market making - - - - - - - - - -
- - - - - - 199,000 1,047 199,000 1,047
With other entities for
Hedging - - - - 9,081,000 7,374 - - 9,081,000 7,374
Market making - - 904,470 - - - - - 904,470 -
- - 904,470 - 9,081,000 7,374 - - 9,985,470 7,374
Total
Hedging - - 904,470 - 9,081,000 7,374 2,699,000 1,102 12,684,470 8,476
Market making - - 904,470 - - - - - 904,470 -
- - 1,808,940 - 9,081,000 7,374 2,699,000 1,102 13,588,940 8,476
-
2020
Forward purchase Forward sale contracts

Counterparties
Interest rate swaps FX options contracts of of government Total
government securities securities
Mark to Mark to Mark to Mark to Mark to

Notional Notional Notional Notional Notional
market market market market market
principal principal principal principal principal
gain gain gain gain gain
------------------------------------------------------------------------------------------------------------------------------------------- (Rupees in '000) ---------------------------------------------------------------------------------------------------------

With banks for
Hedging - - - - - - - - - -
Market making - - - - - - - - - -
- - - - - - - - - -
With FIs other than Banks for
Hedging - - - - - - - - - -
Market making - - - - - - - - - -
- - - - - - - - - -
With other entities for
Hedging - - - - - - - - - -
Market making - - - - - - - - - -
- - - - - - - - - -
Total
Hedging - - - - - - - - - -
Market making - - - - - - - - - -
- - - - - - - - - -
40
23.2 Maturity analysis of derivatives
2021
No. of Notional Mark to Market
Remaining Maturity
contracts principal Negative Positive Net
------------------------------------- (Rupees in '000) ----------------------------------
Upto 1 month 15 1,088,140 - 1,047 1,047

1 to 3 months 18 9,893,490 - 7,374 7,374
3 to 6 months 3 2,607,310 - 55 55
6 months to 1 year - - - - -
1 to 2 years - - - - -
2 to 3 years - - - - -
3 to 5 years - - - - -
5 to 10 years - - - - -
Above 10 years - - - - -
36 13,588,940 - 8,476 8,476
2020
No. of Notional Mark to Market
Remaining Maturity
contracts principal Negative Positive Net
------------------------------------- (Rupees in '000) ----------------------------------
Upto 1 month - - - - -
1 to 3 months - - - - -
3 to 6 months - - - - -
6 months to 1 year - - - - -
1 to 2 years - - - - -
2 to 3 years - - - - -
3 to 5 years - - - - -
5 to 10 years - - - - -
- - - - -
2021 2020
------------- (Rupees in '000) -------------
24. MARK-UP / RETURN / INTEREST EARNED
On:
Loans and advances 39,108,151 52,047,111
Investments 106,242,797 96,870,108
Lendings to financial institutions 2,079,192 2,481,197
Balances with banks 544,015 604,794
147,974,155 152,003,210
25. MARK-UP / RETURN / INTEREST EXPENSED
On:
Deposits 57,310,275 60,642,133
Borrowings 14,046,041 11,066,917
Subordinated debt 901,417 1,099,595
Cost of foreign currency swaps against foreign currency deposits / borrowings 2,993,848 3,310,675
Lease liability against right-of-use assets 964,050 924,718
76,215,631 77,044,038
41
Note 2021 2020

------------- (Rupees in '000) -------------
26. FEE AND COMMISSION INCOME
Branch banking customer fees 1,755,824 1,637,366

Consumer finance related fees 1,098,806 877,273
Card related fees (debit and credit cards) 2,519,265 1,585,012
Investment banking fees 479,830 329,561
Financial institution rebate / commission 364,083 280,324
Corporate service charges / facility fee 473,528 410,214
Commission on trade 642,754 593,785
Commission on guarantees 600,046 750,871
Commission on cash management 979,969 846,302
Commission on remittances including home remittances - net 2,231,221 2,164,305
Commission on bancassurance 1,543,168 1,170,790
Commission on Benazir Income Support Program - 38,145
Rent on lockers 202,623 189,943
Others 172,856 223,581
13,063,973 11,097,472
27. GAIN ON SECURITIES - NET
Realised 27.1 3,741,248 411,212

Unrealised - held for trading 8.1 16,282 228
3,757,530 411,440
27.1 Realised gain on:
Federal Government securities 1,241,594 (404,609)

Shares 574,559 671,556
Foreign securities 1,925,095 144,265
3,741,248 411,212
28. OTHER INCOME
Charges recovered 268,231 223,827

Rent on properties 70,827 52,556
Gain on sale of fixed assets - net 32,655 74,202
Gain on wind-up of subsidiary 8.11 103,993 -
Gain on sale of Ijarah assets - net 3,928 792
Gain on disposal of non-banking assets - net 13.3.3 & 28.1 - 191,559
Gain on trading liabilities - net 30,883 101,445
510,517 644,381
28.1 The Bank earned nil gain (2020: Rs. 191.559 million) against the sale of the following non-banking assets.
2021 2020
------------- (Rupees in '000) -------------
Open plots situated in Karachi - 226,054

Open plots situated in Islamabad - (17,500)
Property situated in Faisalabad - (16,995)
- 191,559
42
Note 2021 2020

------------- (Rupees in '000) -------------
29. OPERATING EXPENSES
Total compensation expense 29.1 16,436,573 15,553,886
Property expense
Rent and taxes 29.5 954,004 993,473
Insurance 250,254 221,312
Utilities cost 1,648,792 1,451,008
Security (including guards) 1,011,412 1,016,246
Repair and maintenance (including janitorial charges) 317,940 209,524
Depreciation on owned fixed assets 10.2 807,536 807,785
Depreciation on right-of-use assets 10.2 1,928,943 1,655,038
Depreciation on non-banking assets acquired in satisfaction of claims 13.3.2 5,180 -
Others 31,611 30,820
6,955,672 6,385,206
Information technology expenses
Software maintenance 1,480,019 1,357,465
Hardware maintenance 392,971 352,360
Depreciation 10.2 823,801 824,627
Amortisation 11.1 801,197 793,562
Network charges 731,331 708,200
Consultancy charges 240,587 149,380
4,469,906 4,185,594
Other operating expenses
Directors' fees and allowances 39.2 75,300 86,200
Fees and allowances to Shariah Board 39.3 10,548 9,544
Legal and professional charges 761,731 606,089
Commission paid to branchless banking agents 388,782 356,060
Commission paid to sales force 1,405,699 1,235,330
Outsourced service costs 1,361,284 1,331,632
Travelling and conveyance 136,997 145,073
Clearing charges 211,543 225,278
Depreciation 10.2 1,217,678 1,200,563
Depreciation on Islamic financing against leased assets 169,954 216,195
Training and development 53,024 93,677
Postage and courier charges 373,349 305,077
Communication 397,628 453,795
Stationery and printing 807,542 952,771
Marketing, advertisement and publicity 725,050 570,878
Donations 29.3 134,236 341,986
Auditors' remuneration 29.4 106,489 85,269
Insurance 95,281 212,152
Deposit protection premium expense 1,586,701 1,367,556
Cash transportation and sorting charges 833,196 798,446
Entertainment 176,004 142,043
Vehicle expenses 99,983 91,013
Subscription 91,294 114,702
Office running expenses 168,619 177,247
Banking service charges 2,220,659 1,650,142
Repairs and maintenance 791,025 571,658
Cartage, freight and conveyance 48,508 45,228
Miscellaneous expenses 435,088 550,312
14,883,192 13,935,916
42,745,343 40,060,602
43
2021 2020
------- (Rupees in '000) -------
29.1 Total compensation expense
Fees and Allowances etc 2,700,502 2,614,509

Managerial Remuneration
i) Fixed 6,523,046 6,207,016
ii) Variable - Cash Bonus 1,237,192 972,579
Charge for defined benefit plan 579,028 567,778
Contribution to defined contribution plan 393,269 364,906
Charge for compensated absences 39,083 70,902
Rent & house maintenance 2,451,373 2,271,681
Utilities 1,318,074 1,217,620
Medical 819,360 762,605
Conveyance 355,754 321,206
Group assurance premium 19,796 64,018
Others 96 66
Sub-total 16,436,573 15,434,886
Awards - 119,000
Severance allowance - -
Grand Total 16,436,573 15,553,886
Number of person
Awards - 1
Severance allowance - -
29.2 Total cost for the year included in other operating expenses relating to outsourced activities is Rs. 1,712.093 million (2020:
Rs. 1,562.390 million). This cost includes outsourced service costs, which are disclosed specifically in note 29. Of the total
cost of Rs. 1,712.093 million (2020: Rs. 1,562.390 million), Rs. 1,465.852 million (2020: Rs. 1,246.825 million) pertains to
payments to companies incorporated in Pakistan and Rs. 246.241 million (2020: Rs. 315.565 million) pertains to payments
to companies incorporated outside Pakistan. This includes payments other than outsourced services costs, which are
disclosed above. Total cost of outsourced activities for the year given to related parties is nil (2020: nil).
The material outsourcing arrangements along with their nature of services are as follows:
Name of service provider Type of service 2021 2020

------- (Rupees in '000) -------
Paradise Press (Private) Limited Cheque book printing services 45,152 40,699
APEX Printry (Private) Limited Cheque book printing services 55,531 45,096
Printlink Cheque book printing services 46,115 40,890
EBRYX Technologies F.Z.C IT security gateway solution 68,573 -
ASC First Solution (Private) Limited Storage and digital archiving services 5,322 5,764
Wackenhut Pakistan (Private) Limited Cash Replenishment 25,130 1,098
Raaziq International Storage and digital archiving services 15,706 14,418
Qadri Enterprises Key Punch 9,061 9,710
TCS (Private) Limited Statement of account printing
and dispatching 80,219 73,083
350,809 230,758
44
29.3 Details of donations 2021 2020

------- (Rupees in '000) -------
Donations individually exceeding Rs.0.5 million
Shaukat Khanum Memorial Trust 35,000 33,000
Namal Educational Foundation 30,000 95,000
The Noorani Foundation 20,000 -
Lahore University of Management Sciences 10,000 10,000
Saylani Welfare International Trust 10,000 25,000
Shalamar Hospital 5,000 5,000
Forman Christian College 5,000 5,000
The Citizens Foundation 3,400 -
Sahara for Life Trust 3,294 10,000
Marie Adelaide Leprosy Center 850 850
Patients Aid Foundation 3,000 -
Jinnah Foundation 1,000 -
Family Educational Services Foundation 1,350 -
Patients Behbud Society for AKUH 1,540 -
Kashmir Education Foundation 2,519 -
Nasra Schools 1,783 -
PMs COVID-19 Pandemic Relief Fund – 2020 - 100,000
Abdul Sattar Edhi Foundation - 43,000
Noor International - 11,200
IBA - National Talent Hunt Program - 3,436
Donations individually not exceeding Rs. 0.5 million 500 500
134,236 341,986
29.3.1 None of the directors, executives or their spouses had any interest in the donees.
29.4 Auditors' remuneration 2021

Domestic Overseas Total
------------------------- (Rupees in '000) ------------------
Audit fee 17,280 30,373 47,653

Fee for tax and other statutory certifications 6,061 1,375 7,436
Consultancy and other services 39,006 4,227 43,233
Out of pocket expenses 7,447 720 8,167
69,794 36,695 106,489
2020
Domestic Overseas Total
------------------------- (Rupees in '000) ------------------
Audit fee 16,848 47,063 63,911

Fee for tax and other certifications 7,759 - 7,759
Consultancy and other services 4,746 - 4,746
Out of pocket expenses 6,696 2,157 8,853
36,049 49,220 85,269
29.5 This includes expense in respect of short term leases and low value assets not included in lease liabilites amounting to Rs.
32.860 million (2020: Rs. 24.687 million) and Rs. 0.007 million (2020: Rs. 0.007 million) respectively.
30. WORKERS' WELFARE FUND
The Bank has made provision for Workers' Welfare Fund (WWF) based on profit for the respective years.
45
Note 2021 2020

31. OTHER CHARGES ------------- (Rupees in '000) -------------
Penalties imposed by the SBP 164,032 163,940

Penalties imposed by other regulatory bodies of overseas branches 34,525 3,395
198,557 167,335
32. (REVERSALS) / PROVISIONS AND WRITE-OFFS - NET
Provision against loans and advances - net 9.4 1,239,990 16,203,144

(Reversal) / provision for diminution in value of investments - net 8.3 (1,271,498) 341,551
Bad debts written off directly 9.6 42,643 77,094
(Reversal) / provision against other assets 13.4.1 (168,605) 154,855
(Reversal) / provision against off - balance sheet obligations 19.1 (344,250) 431,749
Recoveries against written off / charged off bad debts (633,138) (494,488)
Reversal of deficit on revaluation of fixed assets (196,888) -
Other provisions / write-offs 376,339 54,243
(955,407) 16,768,148
33. TAXATION
Current 20,893,122 17,210,908

Prior years (189,010) -
Deferred 540,918 (3,917,221)
21,245,030 13,293,687
33.1 Relationship between tax expense and accounting profit
Accounting profit for the year 52,127,153 34,192,470
Tax on income @ 35% (2020: 35%) 18,244,504 11,967,365

Super tax @ 4% (2020: 4%) 2,085,086 1,367,699
Additional tax charge under sub rule 6A 800,223 -
Tax effect of permanent differences 77,437 65,261
Others 37,780 (106,638)
Tax charge 21,245,030 13,293,687
34. EARNINGS PER SHARE
Profit after taxation for the year 30,882,123 20,898,783
-------- (Number of shares) --------
Weighted average number of ordinary shares 1,224,179,687 1,224,179,687
---------------- (Rupees) ----------------
Basic and diluted earnings per share 25.23 17.07
There were no convertible dilutive potential ordinary shares outstanding as at December 31, 2021 and 2020.
Note 2021 2020

35. CASH AND CASH EQUIVALENTS ------------- (Rupees in '000) -------------
Cash and balances with treasury banks 5 267,937,282 250,838,052

Balances with other banks 6 23,363,057 13,888,765
291,300,339 264,726,817
46
35.1 Reconciliation of movement of liabilities to cash flows arising from financing activities
2021 2020
Lease liability Lease liability

Dividends Unappropriated Dividends Unappropriated
against right-of- against right-
payable profit payable profit
use assets of-use assets
------------------------------------------------------------------- (Rupees in '000) -------------------------------------------------------------------
Balance as at January 01, 7,776,503 357,578 81,916,463 7,761,350 538,884 71,670,331
Changes from financing cash flows

Payment of lease liability
against right-of-use assets (2,649,400) - - (2,174,025) - -
Dividend Paid - (23,622,786) - - (8,138,474) -
Total changes from financing cash flows (2,649,400) (23,622,786) - (2,174,025) (8,138,474) -
Other Changes
- Liability related
Cash dividend - 26,319,864 (26,319,864) - 7,957,168 (7,957,168)
Interest expense on lease liability
against right-of-use assets 964,050 - - 924,718 - -
Non-cash based 2,320,870 - - 1,264,460 - -
Total other changes 3,284,920 26,319,864 (26,319,864) 2,189,178 7,957,168 (7,957,168)
- Equity related - - 29,029,355 - - 18,203,300
Balance as at December 31, 8,412,023 3,054,656 84,625,954 7,776,503 357,578 81,916,463
36. STAFF STRENGTH

2021 2020
------------------------------------------------------------
Note (Number of employees) -------------------------------------------------
Domestic Overseas Total Domestic Overseas Total
Permanent 11,420 212 11,632 10,882 265 11,147
On contract 11 2 13 16 3 19
Bank's own staff strength 11,431 214 11,645 10,898 268 11,166
Outsourced 36.1 1,542 46 1,588 1,781 65 1,846
Total 12,973 260 13,233 12,679 333 13,012
36.1 This excludes employees of outsourced services companies assigned to the Bank to perform services of security
guards and janitorial staff.
37. DEFINED BENEFIT PLANS
37.1 General description
The Bank operates the following schemes:
37.1.1 Pension Fund
The Bank operates a funded pension scheme established in 1975. The Pension Scheme was introduced on 1st January
1975 for Clerical and Non-Clerical employees and on the 1st May 1977 for Officers. Those in service at these dates
were given an option to join the Pension Scheme or stay in the Bank's old gratuity scheme.
47
37.1.2 Gratuity scheme
The Bank also operates a funded gratuity scheme for new employees and for those employees who have not opted for
the pension scheme.
37.1.3 Benevolent fund scheme
The Bank also operates a funded benevolent fund scheme which covers all regular employees of the Bank who joined
the Bank pre-privatization. Under this scheme, a fixed monthly subscription is made by employees by way of a salary
deduction. Employees covered under this scheme, are entitled to receive benevolent grants on death, disability,
retirement and other contingencies as monthly grant payment or one-time payment subject to certain conditions as
specified in the rules of the fund.
37.1.4 Post retirement medical benefits
The Bank also provides a non-funded post retirement medical benefits to eligible retired employees. The post-retirement
medical scheme cover all regular employees of the Bank who joined the Bank pre-privatization.
37.1.5 Compensated absences
The Bank maintains a non-funded scheme for compensated absences.
37.1.6 Other schemes
Employee benefit schemes offered by the Bank’s overseas branches are governed by the laws of the respective
countries in which the branches operate.
37.2 Number of Employees under the scheme
The number of employees covered under the following defined benefit schemes are:
2021 2020
---------- (Number) ----------
- Pension fund 695 801

- Gratuity fund 10,776 10,083
- Post-retirement medical benefit scheme 959 1,108
- Benevolent fund 1,062 1,249
- Employee compensated absences 1,061 1,258
In addition to above active employees, pension fund, benevolent fund and post-retirement medical benefit schemes
include 7,064 (2020: 7,049), 1,951 (2020: 1,982) and 7,640 (2020: 7,346) members respectively who have retired or
whose widows and other beneficiaries are receiving the benefits.
37.3 Principal actuarial assumptions
The actuarial valuations were carried out as at December 31, 2021, using Projected Unit Credit Method. The following
significant assumptions were used for the valuation:
2021 2020
---------- Per annum ----------
Discount rate 11.75% 9.75%

Expected rate of salary increase 9.75% 7.75%
Expected rate of increase in pension 5.00% 5.00%
Expected rate of increase in medical benefit 5.75% 3.75%
Expected rate of return on plan assets 11.75% 9.75%
48
37.4 Pension, gratuity, benevolent fund schemes and other benefits
37.4.1 The fair value of plan assets and the present value of defined benefit obligations of these schemes as at December 31,
2021 are as follows:
2021
Post -
Pension Gratuity Benevolent retirement
fund fund fund medical
benefit
------------------------------------------------------------------------
Note (Rupees in '000) ------------------------------------
Present value of defined benefit obligations (10,109,150) (1,205,040) (298,047) (2,175,874)

Fair value of plan assets 12,155,659 1,101,355 328,607 -
Receivable / (payable) 2,046,509 (103,685) 30,560 (2,175,874)
2020
Post -
benefit
------------------------------------------------------------------------ (Rupees in '000) ------------------------------------
Present value of defined benefit obligations (11,604,939) (1,049,184) (331,363) (2,028,687)

Fair value of plan assets 10,521,021 1,015,218 330,708 -
Payable (1,083,918) (33,966) (655) (2,028,687)
37.5 Movement in the present value of defined benefit obligations

2021
Post -
benefit
------------------------------------------------------------------------ (Rupees in '000) ------------------------------------
Obligations at the beginning of the year 11,604,939 1,049,184 331,363 2,028,687

Current service cost 23,694 164,282 3,917 471
Interest cost 1,020,574 104,189 29,798 192,584
Benefits paid by the Bank (891,349) (167,607) (40,031) (136,430)
Return allocated to other funds 37.8.1 51,513 - -
Re-measurement (gains) / losses (1,700,221) 54,992 (27,000) 90,562
Obligations at the end of the year 10,109,150 1,205,040 298,047 2,175,874
2020
Post -
benefit
------------------------------------------------------------------------ (Rupees in '000) ------------------------------------
Obligations at the beginning of the year 10,098,497 911,763 329,300 1,950,906

Interest cost 994,529 105,266 34,197 213,970
Benefits paid by the Bank (901,142) (126,864) (42,236) (97,195)
Return allocated to other funds 37.8.1 58,882 - - -
Re-measurement losses / (gains) 1,330,317 6,180 5,993 (39,518)
Obligations at the end of the year 11,604,939 1,049,184 331,363 2,028,687
49
37.6 Movement in fair value of plan assets

2021 2020
Pension Gratuity Benevolent Pension Gratuity Benevolent

fund fund fund fund fund fund
------------------------------------------------------------------------ (Rupees in '000) ------------------------------------------------------
Fair value at the beginning of the year 10,521,021 1,015,218 330,708 9,318,843 968,544 424,706
Interest income on plan assets 1,000,068 101,028 29,737 996,935 111,322 44,373
Contribution by the Bank 1,439,154 132,415 1,384 877,014 92,184 1,601
Contribution by the employees - - 1,384 - - 1,601
Amount paid by the fund to the Bank (1,107,948) (171,523) (40,036) (703,722) (125,781) (137,717)
Re-measurements gains / (losses) 303,364 24,217 5,430 31,951 (31,051) (3,856)
Fair value at the end of the year 12,155,659 1,101,355 328,607 10,521,021 1,015,218 330,708
37.7 Movement in (payable) / receivable under defined benefit schemes
2021
Post -
benefit
------------------------------------------------------------------------ (Rupees in '000) ------------------------------------
Opening balance (1,083,918) (33,966) (655) (2,028,687)

Adjustment for mark-up 2,777 544 199 -
(Charge) / reversal for the year (95,713) (167,443) (2,594) (193,055)
Contribution by the Bank 1,439,154 132,415 1,384 -
Amount paid by the Fund to the Bank (1,107,948) (171,523) (40,036) -
Benefits paid by the Bank 891,349 167,607 40,031 136,430
Re-measurement (losses) / gains recognised in OCI 2,000,808 (31,319) 32,231 (90,562)
Closing balance 2,046,509 (103,685) 30,560 (2,175,874)
2020
Post -
benefit
------------------------------------------------------------------------ (Rupees in '000) ------------------------------------
Opening balance (779,654) 56,781 95,406 (1,950,906)

Adjustment for Mark-up 9,749 310 539 -
(Charge) / reversal for the year (80,332) (146,783) 7,668 (214,494)
Contribution by the Bank 877,014 92,184 1,601 -
Amount paid by the Fund to the Bank (703,722) (125,781) (137,717) -
Benefits paid by the Bank 901,142 126,864 42,236 97,195
Re-measurement (losses) / gains recognised in OCI (1,308,115) (37,541) (10,388) 39,518
Closing balance (1,083,918) (33,966) (655) (2,028,687)
50
37.8 Charge for defined benefit plans
37.8.1 Cost recognised in profit and loss 2021

Post -
benefit
------------------------------------------------------------------------
Note (Rupees in '000) ------------------------------------
Past service cost - - - -
Net interest on defined benefit asset 20,506 3,161 61 192,584
Return allocated to other funds 37.8.1.1 51,513 - - -
Employees' contribution - - (1,384) -
95,713 167,443 2,594 193,055
2020
Post -
benefit
------------------------------------------------------------------------ (Rupees in '000) ------------------------------------
Past service cost - - - -
Net interest on defined benefit asset / (liability) (2,406) (6,056) (10,176) 213,970
Return allocated to other funds 58,882 - - -
Employees' contribution - - (1,601) -
80,332 146,783 (7,668) 214,494
37.8.1.1 This represents return allocated to those employees who exercised the conversion option offered in the year 2001, as
referred in note 4.12.
37.8.2 Re-measurements recognised in OCI during the year

2021
Post -
benefit
------------------------------------------------------------------------ (Rupees in '000) ------------------------------------
Losses / (gains) on obligation
- Financial assumptions (1,584,685) 14,089 (28,611) 216,207
- Experience adjustment (115,536) 40,903 1,611 (125,645)
Return on plan assets over interest income (303,364) (24,217) (5,430) -
Total re-measurements recognised in OCI (2,000,808) 31,319 (32,231) 90,562
2020
Post -
benefit
------------------------------------------------------------------------ (Rupees in '000) ------------------------------------
Losses / (gains) on obligation
- Financial assumptions 1,379,653 (9,341) 28,729 153,627
- Experience adjustment (49,336) 15,521 (22,736) (193,145)
Return on plan assets over interest income (31,951) 31,051 3,856 -
Total re-measurements recognised in OCI 1,308,115 37,541 10,388 (39,518)
Re-measurements recongnised in OCI during the year pertaining to other schemes as disclosed in note 37.1.6 is Rs.
29.878 million.
51
37.9 Components of fair value of

plan assets 2021 2020
Benevolent Benevolent
Pension fund Gratuity fund Pension fund Gratuity fund
fund fund
-------------------------------------------------------------------------------------- (Rupees in '000) ---------------------------------------------------------------
Cash and cash equivalents - net 1,469,670 20,075 49,037 236,332 103,110 27,894
Ordinary shares 371,767 6,068 13,426 89,090 5,483 12,491
Term deposits 741,376 - - - - -
Non-Government debt securities 394,397 23,000 12,012 244,257 23,270 11,893
Mutual funds units 1,113,120 120,560 10,548 167,165 16,737 -
Pakistan Investment Bonds 5,798,245 666,061 198,390 4,970,102 316,307 133,864
Market Treasury Bills 2,267,084 265,567 45,194 3,306,798 539,015 135,330
National Saving Certificates / Bonds - - - 1,507,277 11,103 2,830
Certificate of Investments - - - - - 6,406
Repurchase agreements - 24 - - 193 -
12,155,659 1,101,355 328,607 10,521,021 1,015,218 330,708
37.9.1 The Funds primarily invests in Government Securities and accordingly do not carry any significant credit risk. These are
subject to interest rate risk based on market movements. Investment in term finance certificates are subject to credit risk
and interest rate risks, while equity securities are subject to price risk. These risks are regularly monitored by Trustees of
the employee funds.
37.10 Sensitivity analysis
Sensitivity analysis has been performed by varying one assumption keeping all other assumptions constant and
calculating the impact on the present value of the defined benefit obligations under the various employee benefit
schemes. The increase / (decrease) in the present value of defined benefit obligations as a result of change in each
assumption is summarized below:
2021
Post-retirement
Pension fund Gratuity fund Benevolent fund
medical benefit
------------------------------------------------------------- (Rupees in '000) ----------------------------------------------------
Increase in Discount Rate by 1 % (709,618) (78,310) (11,783) (215,785)
Decrease in Discount Rate by 1 % 821,363 88,995 12,947 259,035
Increase in expected future increment in salary by 1% - 95,739 - -
Decrease in expected future increment in salary by 1% - (85,471) - -
Increase in expected future increment in pension by 1% 837,438 - - -
Decrease in expected future increment in pension by 1% (733,347) - - -
Increase in expected future increment in medical benefit by 1% - - - 240,707
Decrease in expected future increment in medical benefit by 1% - - - (206,289)
37.11 Expected contributions to be paid to the funds in the next financial year
The Bank contributes to the pension and gratuity funds according to the actuary's advice. Contribution to the benevolent
fund is made by the Bank as per the rates set out in the benevolent fund scheme. Based on actuarial advice,
management estimates that the expected contribution and charge / (reversal) for the year ending December 31, 2022,
would be as follows:
2022
Post retirement
medical benefit
------------------------------------------------------------- (Rupees in '000) ----------------------------------------------------
Expected contribution - - 1,274 -
Expected (reversal) / charge for the year (215,190) 202,187 (1,508) 249,115
37.12 Maturity profile 2021

Post retirement
medical benefit
------------------------------------------------------------- (Rupees in '000) ----------------------------------------------------
The weighted average duration of the obligation (in years) 8.02 6.91 3.68 7.91
52
37.13 Funding Policy
The Bank endeavours to ensure that liabilities under the various employee benefit schemes are covered by the Fund on
any valuation date, based on various actuarial assumptions.
37.14 The significant risks associated with the staff retirement benefit schemes are as follows:
Asset Volatility
The risk arises due to inclusion of risky assets in the funds portfolio, inflation and interest rate volatility.
Changes in Bond Yields
The risk arises when bond yield is lower than the expected return on the planned assets (duration based PIB discount rate).
Inflation Risk
The salary inflation is the major risk that the Gratuity and compensated absences liability carries. In pension fund the
increase has been determined by the Supreme Court and does not carry this risk as the benefit is practically no longer
exposed to future salary increases. Some of the post-retirement medical benefits are capped to a proportion of Pension,
thus carrying no salary inflation risk. However, the hospitalization benefit is susceptible to medical inflation risk.
Withdrawal Risk
Withdrawal risks is the risk of higher or lower withdrawal experience than assumed. The final effect could go either way
depending on the beneficiaries’ service/age distribution and the benefit.
Other Risks
Though, not imminent and generally observable, over long term there are some risks that may crystallise. This includes:
- Retention Risk – The risk that employee will not be motivated to continue the service or start working with the Bank if
no market comparable retirement benefit is provided.
- Final Salary Risk – The risk, for defined benefit gratuity, that any disproportionate salary merit increases in later
service years will give rise to a multiplicative increase in the gratuity liability as such increase is applicable to all the
past years of service.
- Model Risk – The defined benefit gratuity liability is valued by actuary each year. Further, the assets in the Fund are
also marked to market. This two-tier valuation gives rise to the model risk.
- Operational Risk related to a separate entity - Retirement benefits are funded through a separate trust fund which is a
different legal entity than the Bank. Generally, the protocols, processes, and conventions used throughout the Bank
are not applicable or are not actively applied to the retirement benefit Funds. This gives rise to some specific
operational risks.
- Compliance Risk – The risk that retirement benefits offered by the Bank do not comply with minimum statutory
requirements.
- Legal / Political Risk – The risk that the legal / political environment changes and as a result, the Bank is required to
offer additional or different retirement benefits than what the Bank projected. Specifically, in the light of recent
Supreme Court decisions, this risk has materialised.
38. OTHER EMPLOYEE BENEFITS
Defined contribution plan
The Bank operates a contributory provident fund scheme for 9,930 (2020: 10,083) employees who are not in the pension
scheme. The employer and employee each contribute 8.33% of the basic salary to the funded scheme every month.
53
39. COMPENSATION OF DIRECTORS AND KEY MANAGEMENT PERSONNEL
39.1 Total Compensation Expense
2021
Directors Other
Members Key
Executives President / Material Risk
Items Non- Shariah Management
Chairman (other than CEO Takers/
Executives Board Personnel
CEO) Controllers
-------------------------------------------------------------------------------------- (Rupees in '000) --------------------------------------------------------------------------
Fees and Allowances etc. 8,400 - 66,900 10,548 - - -

i) Fixed - - - - 105,600 152,703 415,952
ii) Variable - Cash Bonus - - - - 95,703 210,824 222,380
Contribution to defined contribution plan - - - - 8,800 10,722 34,361
Charge for defined benefit plan - - - - 2,861 4,310 15,970
Rent & house maintenance - - - - 12,036 68,716 187,178
Utilities - - - - 2,574 30,541 83,190
Medical - - - - 115 15,270 41,595
Conveyance - - - - 4,707 24,331 131,481
Others - - - - - 1,638 29,867
Sub-total 8,400 - 66,900 10,548 232,396 519,055 1,161,974
Awards - - - - 108,467 - -
Total 8,400 - 66,900 10,548 340,863 519,055 1,161,974
Number of Persons 1 - 7 3 1 17 117
2020
Directors Other
Members Key
Executives President / Material Risk
Items Non- Shariah Management
Chairman (other than CEO Takers/
Executives Board Personnel
CEO) Controllers
-------------------------------------------------------------------------------------- (Rupees in '000) --------------------------------------------------------------------------
Fees and Allowances etc. 10,495 - 75,705 9,544 - - -

i) Fixed - - - - 81,542 148,050 307,058
ii) Total Variable - Cash Bonus - - - - 117,930 174,685 165,154
Contribution to defined contribution plan - - - - 6,795 9,817 24,888
Charge for defined benefit plan - - - - 2,484 4,469 14,957
Rent & house maintenance - - - - 8,811 66,622 138,176
Utilities - - - - 1,551 29,610 61,412
Medical - - - - - 14,805 30,706
Conveyance - - - - 2,070 23,835 87,940
Others - - - - - 1,263 16,044
Sub-total 10,495 - 75,705 9,544 221,183 473,156 846,335
Awards - - - - - - -
Total 10,495 - 75,705 9,544 221,183 473,156 846,335
Number of Persons 1 - 7 3 2 15 88
The total amount of deferred bonus as at December 31, 2021 for the President / CEO, Key Management Personnel and other Material Risk Takers (MRT) / Material Risk
Controllers (MRC) is Rs. 181.016 million (2020: Rs. 133.402 million). The deferred bonus is held in a trust fund.
54
39.2 Remuneration paid to Directors for participation in Board and Committee Meetings
2021
Meeting Fees and Allowances Paid
For Board Committees
Board Human
Sr. Board Risk & Board
Name of Director For Board Board Audit Resource & Board IT
No. Compliance Nomination Total Amount
Meetings Committee Compensation Committee Allowance
Committee Committee Paid
(BAC) Committee (BITC)
(BRCC) (BNC)
(HRCC)
---------------------------------------------------------------------- (Rupees in '000) ----------------------------------------------------------------------------
1 Sir Mohammed Anwar Pervez, OBE, HPk 4,500 - 3,000 - - 750 150 8,400
2 Lord Zameer M. Choudrey, CBE, SI Pk 3,750 - - 3,000 3,000 750 300 10,800
3 Mr. Haider Zameer Choudrey 3,750 3,750 - - 3,000 - 300 10,800
4 Mr. Arshad Ahmad Mir 3,750 - 3,000 3,000 - 750 - 10,500
5 Mr. Rizwan Pervez 3,750 3,750 3,000 - - - 300 10,800
6 Ms. Shazia Syed 3,750 3,750 - 3,000 - - - 10,500
7 Mr. Amar Zafar Khan 3,750 - - - - - - 3,750
8 Mr. Tariq Rashid 3,750 - 3,000 - 3,000 - - 9,750
Total Amount Paid 30,750 11,250 12,000 9,000 9,000 2,250 1,050 75,300
2020
Meeting Fees and Allowances Paid
For Board Committees
Sr. Board Human
No.
Name of Director For Board Board Audit Resource & Board Risk & Board IT Board
Meetings Committee Compensation Compliance Committee Nomination Allowance
Total Amount
Committee Committee Paid
(BAC) Committee (BITC)
(BRCC) (BNC)
(HRCC)
---------------------------------------------------------------------- (Rupees in '000) ----------------------------------------------------------------------------
1 Sir Mohammed Anwar Pervez, OBE, HPk 6,300 - 750 - - 3,000 445 10,495
2 Lord Zameer M. Choudrey, CBE, SI Pk 5,250 - - 3,000 750 3,000 587 12,587
3 Mr. Haider Zameer Choudrey 5,250 3,750 - - 3,000 - 587 12,587
4 Mr. Arshad Ahmad Mir 5,250 1,500 3,000 2,250 - 2,250 436 14,686
5 Mr. Rizwan Pervez 5,250 3,750 750 - - - 595 10,345
6 Mr. Khalid Ahmed Sherwani* 3,000 2,250 2,250 - - - - 7,500
7 Ms. Shazia Syed ** - - - - - - - -
8 Mr. Amar Zafar Khan 4,500 2,250 2,250 - - - - 9,000
9 Mr. Tariq Rashid 4,500 750 750 - 3,000 - - 9,000
Total Amount Paid 39,300 14,250 9,750 5,250 6,750 8,250 2,650 86,200
* Mr. Khalid Ahmed Sherwani resigned from the Board with effect from August 05, 2020.
** Ms. Shazia Syed joined the Board with effect from November 10, 2020.
39.3 Remuneration paid to Shariah Board Members
2021 2020
Resident Non-Resident Resident Non-Resident

Items Chairman Total Chairman Total
Member Member Member Member
-------------------------------------------------------------------------------------- (Rupees in '000) ----------------------------------------------------------------------------------
Meeting fees and allowances 4,152 3,564 2,832 10,548 2,772 4,000 2,772 9,544
Total number of persons 1 1 1 1 1 1
40. FAIR VALUE MEASUREMENTS
The fair value of quoted securities other than those classified as held to maturity, is based on quoted market price. Quoted
securities classified as held to maturity are carried at cost. The fair value of unquoted equity securities, other than
investments in associates and subsidiaries, is determined on the basis of the break-up value of these investments as per
their latest available audited financial statements.
55
The fair value of unquoted debt securities, fixed term loans, other assets, other liabilities, fixed term deposits and
borrowings cannot be calculated with sufficient reliability due to the absence of a current and active market for these assets
and liabilities and reliable data regarding market rates for similar instruments.
In the opinion of the management, the fair value of the remaining financial assets and liabilities are not significantly different
from their carrying values since these are either short-term in nature or, in the case of customer loans and deposits, are
frequently repriced.
40.1 The Bank measures fair values using the following fair value hierarchy that reflects the significance of the inputs used in
making the measurements:
Level 1: Fair value measurements using quoted prices (unadjusted) in active markets for identical assets or liabilities.
Level 2: Fair value measurements using inputs other than quoted prices included within Level 1 that are observable for the
assets or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices).
Level 3: Fair value measurements using input for the asset or liability that are not based on observable market data (i.e.
unobservable inputs).
The table below analyses financial instruments measured at the end of the reporting period by the level in the fair value
hierarchy into which the fair value measurement is categorised:
40.1.1 Valuation techniques used in determination of fair values within level 2 and level 3.
Item Valuation approach and input used

Federal Government securities The fair value of Federal Government securities is determined using the prices /
rates available on Mutual Funds Association of Pakistan (MUFAP)
Non-Government debt securities The fair value of other corporate and foreign government securities is determined
using the rates from Reuters / Bloomberg / MUFAP.
Units of mutual fund The fair values of investments in units of mutual funds are determined based on
their net asset values as published at the close of each business day.
Forward foreign exchange contracts The fair values of forward foreign exchange contracts and forward Government
and Forward Government securities securities transactions are determined using forward pricing calculations.
transactions
Derivatives The fair valuation techniques include forward pricing and swap models using
present value calculations.
Fixed assets and non-banking Land, buildings and non-banking assets acquired in satisfaction of claims are
assets acquired in revalued on a periodic basis using professional valuers. The valuation is based on
satisfaction of claims their assessment of the market value of the assets. The effect of changes in the
unobservable inputs used in the valuations cannot be determined with certainty.
Accordingly, a qualitative disclosure of sensitivity has not been presented in these
unconsolidated financial statements.
40.2 Fair value of financial assets
The following table provides the fair values of those of the Bank’s financial assets that are recognised or disclosed at fair
value in these unconsolidated financial statements:
2021
Fair value
Carrying value
Level 1 Level 2 Level 3 Total
------------------------------------------------------------------------------ (Rupees in '000) -----------------------------------------------------------------------
On balance sheet financial instruments
Financial assets - measured at fair value

Investments
- Federal Government securities 1,073,306,788 - 1,073,306,788 - 1,073,306,788
- Foreign bonds - sovereign 39,983,159 - 39,983,159 - 39,983,159
- Foreign bonds - others 1,194,895 - 1,194,895 - 1,194,895
- Ordinary shares of listed companies 9,665,709 9,665,709 - - 9,665,709
- Mutual fund units 242,468 - 242,468 - 242,468
- Non-Government debt securities 2,072,482 - 2,072,482 - 2,072,482
- Real Estate Investment Trust units 506,950 506,950 - - 506,950
1,126,972,451 10,172,659 1,116,799,792 - 1,126,972,451
56
2021
Fair value
Carrying value
------------------------------------------------------------------------------ (Rupees in '000) -----------------------------------------------------------------------
Financial assets - disclosed but not measured at fair value
Investments
- Federal Government Securities 305,701,682 - 296,942,277 - 296,942,277
- Foreign Bonds - Market Treasury Bills 2,682,985 - 2,682,985 - 2,682,985
- Foreign Bonds - sovereign 32,937,264 - 32,805,738 - 32,805,738
- Foreign Bonds - others 2,159,801 - 2,183,328 - 2,183,328
363,713,655 - 354,991,660 - 354,991,660
1,490,686,106 10,172,659 1,471,791,452 - 1,481,964,111
Off-balance sheet financial instruments - measured at fair value
Forward purchase and sale of foreign exchange contracts 652,382,419 - 2,913,205 - 2,913,205
FX options - purchased and sold 1,808,940 - - - -
Forward purchase and sale of Government Securities 11,780,000 - 8,476 - 8,476
2020
Fair value
Carrying value
On balance sheet financial instruments ------------------------------------------------------------------------------ (Rupees in '000) -----------------------------------------------------------------------
Financial assets - measured at fair value

Investments
- Ordinary shares of listed companies 10,383,260 10,383,260 - - 10,383,260
- Mutual Fund units 228,518 - 228,518 - 228,518
- Real Estate Investment Trust units 441,914 441,914 - - 441,914
881,477,293 10,825,174 870,652,119 - 881,477,293
Financial assets - disclosed but not measured at fair value
- Foreign Bonds - Market Treasury Bills 2,696,727 - 2,696,727 - 2,696,727
241,546,509 - 246,788,536 - 246,788,536
1,123,023,802 10,825,174 1,117,440,655 - 1,128,265,829
2020
Fair value
Carrying value
------------------------------------------------------------------------------ (Rupees in '000) -----------------------------------------------------------------------
Off-balance sheet financial instruments - measured at fair value
Forward purchase and sale of foreign exchange contracts 635,597,333 - (614,728) - (614,728)
40.3 Fair Value of non-financial assets 2021

Fair value
Carrying value
------------------------------------------------------------------------------ (Rupees in '000) -----------------------------------------------------------------------
Fixed Assets 52,555,712 - - 52,555,712 52,555,712

Non-banking assets acquired in satisfaction of claims 213,344 - - 213,344 213,344
52,769,056 - - 52,769,056 52,769,056
2020
Fair value
Carrying value
------------------------------------------------------------------------------ (Rupees in '000) -----------------------------------------------------------------------
Fixed Assets 36,492,910 - - 36,492,910 36,492,910

Non-banking assets acquired in satisfaction of claims 203,316 - - 203,316 203,316
36,696,226 - - 36,696,226 36,696,226
40.4 Certain categories of fixed assets (land and buildings) and non-banking assets acquired in satisfactions of claims are
carried at revalued amounts (level 3 measurement) determined by professional valuers based on their assessment of the
market values.
57
41. SEGMENT INFORMATION
41.1 Segment details with respect to business activities

2021
Corporate /
International
Commercial Treasury Branch Banking Islamic Banking Others Total
branch operations
Banking
Profit & Loss -------------------------------------------------------------------------------------------------------- (Rupees in '000) ------------------------------------------------------------------------------------------------------
Net mark-up / return / profit 24,469,344 78,385,139 (43,705,708) 5,200,775 8,043,384 (634,410) 71,758,524
Inter segment (expense) / revenue - net (20,339,695) (75,031,260) 89,795,726 - - 5,575,229 -
Non mark-up / return / interest income 3,124,616 4,899,001 9,194,527 349,080 4,709,662 1,102,162 23,379,048
Total Income 7,254,265 8,252,880 55,284,545 5,549,855 12,753,046 6,042,981 95,137,572
Segment direct expenses 1,263,533 577,401 27,653,589 2,010,649 4,945,848 7,514,806 43,965,826
Inter segment expense allocation 498,100 80,888 6,390,687 - 428,085 (7,397,760) -
Total expenses 1,761,633 658,289 34,044,276 2,010,649 5,373,933 117,046 43,965,826
Provisions - net 642,747 862,204 383,545 (70,032) (1,022,450) 159,393 955,407
Profit before tax 6,135,379 8,456,795 21,623,814 3,469,174 6,356,663 6,085,328 52,127,153
Balance Sheet
Cash & Bank balances 5,847 83,432,361 131,280,024 20,417,689 56,164,418 - 291,300,339
Investments 8,802,055 1,281,680,391 - 87,124,858 113,449,568 5,485,581 1,496,542,453
Net inter segment lending - - 1,200,813,673 3,061,160 - 73,725,465 1,277,600,298
Lendings to financial institutions - 49,826,776 - - - 1,874,300 51,701,076
Advances - performing 421,026,745 16,109 48,013,514 43,788,936 118,247,080 3,786,906 634,879,290
Advances - non-performing net of provision 2,765,799 - 414,816 66,191 8,041,387 20,974 11,309,167
Others 15,418,743 22,200,014 17,122,102 2,493,298 12,940,002 62,259,423 132,433,582
Total Assets 448,019,189 1,437,155,651 1,397,644,129 156,952,132 308,842,455 147,152,649 3,895,766,205
Borrowings 62,724,244 474,334,893 4,626,077 5,714,199 15,885,337 - 563,284,750

Subordinated debt - - - - - 10,000,000 10,000,000
Deposits & other accounts 47,718,108 302,491 1,331,212,978 139,534,238 232,014,732 161,218 1,750,943,765
Net inter segment borrowing 307,488,592 969,169,066 - - 942,640 - 1,277,600,298
Others 26,327,113 (10,792,063) 49,140,583 4,697,855 7,199,334 12,722,023 89,294,845
Total Liabilities 444,258,057 1,433,014,387 1,384,979,638 149,946,292 256,042,043 22,883,241 3,691,123,658
Equity 3,761,132 4,141,264 12,664,491 7,005,839 52,800,412 124,269,409 204,642,547
Total Equity & liabilities 448,019,189 1,437,155,651 1,397,644,129 156,952,131 308,842,455 147,152,650 3,895,766,205
Contingencies and Commitments 368,891,124 239,061,601 40,476,794 14,347,612 469,317,371 182,362 1,132,276,864
2020
Corporate /
International
branch operations
Banking
-------------------------------------------------------------------------------------------------------- (Rupees in '000) ------------------------------------------------------------------------------------------------------
Profit and Loss
Net mark-up / return / profit 35,970,978 72,064,538 (44,324,598) 4,119,872 7,731,711 (603,329) 74,959,172
Inter segment (expense) / revenue - net (28,364,864) (64,465,202) 87,194,395 - - 5,635,671 -
Non mark-up / return / interest income 2,238,145 3,014,483 7,552,725 178,406 2,777,561 1,333,019 17,094,339
Total Income 9,844,259 10,613,819 50,422,522 4,298,278 10,509,272 6,365,361 92,053,511
Segment direct expenses 1,189,534 550,650 25,684,464 1,770,726 5,244,835 6,652,684 41,092,893
Inter segment expense allocation 441,792 71,664 4,991,652 - 539,126 (6,044,234) -
Total expenses 1,631,326 622,314 30,676,116 1,770,726 5,783,961 608,450 41,092,893
Provisions - net (565,442) (123,276) (1,202,340) (12,813) (14,853,113) (11,164) (16,768,148)
Profit / (loss) before tax 7,647,491 9,868,229 18,544,066 2,514,739 (10,127,802) 5,745,747 34,192,470
Balance Sheet
Cash & Bank balances 5,833 81,844,130 122,637,049 12,061,714 47,378,919 799,172 264,726,817
Investments 4,803,162 932,393,450 - 62,729,601 123,251,329 5,496,952 1,128,674,494
Net inter segment lending - - 1,139,940,361 7,997,409 - 77,017,055 1,224,954,825
Lendings to financial institutions - - - 19,959,132 - - 19,959,132
Advances - performing 360,426,353 - 41,532,652 20,521,606 89,119,069 6,811,741 518,411,421
Advances - non-performing net of provision 3,287,884 - 802,173 16,551 7,754,943 6,524 11,868,075
Others 14,416,544 16,648,272 14,780,760 1,705,673 13,302,266 44,898,226 105,751,741
Total Assets 382,939,776 1,030,885,852 1,319,692,995 124,991,686 280,806,526 135,029,670 3,274,346,505
58
2020
Corporate /
International
branch operations
Banking
-------------------------------------------------------------------------------------------------------- (Rupees in '000) ------------------------------------------------------------------------------------------------------
Borrowings 51,240,762 60,191,848 4,600,487 3,632,752 9,321,566 - 128,987,415

Subordinated debt - - - - - 10,000,000 10,000,000
Deposits & other accounts 50,351,838 132,797 1,257,985,091 111,478,161 220,015,338 248,676 1,640,211,901
Net inter segment borrowing 263,282,545 960,917,205 - - 755,075 - 1,224,954,825
Others 13,412,717 3,328,909 47,325,251 4,811,546 6,305,942 10,935,092 86,119,457
Total Liabilities 378,287,862 1,024,570,759 1,309,910,829 119,922,459 236,397,921 21,183,768 3,090,273,598
Equity 4,651,914 6,315,093 9,782,166 5,069,227 44,408,605 113,845,902 184,072,907
Total Equity & liabilities 382,939,776 1,030,885,852 1,319,692,995 124,991,686 280,806,526 135,029,670 3,274,346,505
Contingencies and Commitments 349,133,005 285,716,584 13,182,354 5,991,566 398,498,687 2,721,016 1,055,243,212
41.2 Geographical segment analysis

2021
Export
Pakistan Middle East Processing Total
Zones
Profit and Loss ------------------------------------------- (Rupees in '000) ---------------------------------------
Net mark-up / return / profit 63,715,140 7,826,769 216,615 71,758,524

Non mark-up / return / interest income 18,669,386 4,561,882 147,780 23,379,048
Total Income 82,384,526 12,388,651 364,395 95,137,572
Segment direct expenses 39,019,978 4,921,186 24,662 43,965,826

Inter segment expense allocation (428,085) 425,738 2,347 -
Total expenses 38,591,893 5,346,924 27,009 43,965,826
Provisions - net 1,977,857 (1,022,450) - 955,407
Profit before tax 45,770,490 6,019,277 337,386 52,127,153
Balance Sheet
Cash & Bank balances 235,135,921 55,820,921 343,497 291,300,339

Investments 1,383,092,885 107,079,223 6,370,345 1,496,542,453
Net inter segment lending 1,277,600,298 - - 1,277,600,298
Lendings to financial institutions 51,701,076 - - 51,701,076
Advances - performing 516,632,210 118,165,300 81,780 634,879,290
Advances - non-performing net of provision 3,267,780 8,041,387 - 11,309,167
Others 119,493,580 12,709,197 230,805 132,433,582
Total Assets 3,586,923,750 301,816,028 7,026,427 3,895,766,205
Borrowings 547,399,413 15,885,337 - 563,284,750

Subordinated debt 10,000,000 - - 10,000,000
Deposits & other accounts 1,518,929,033 227,406,988 4,607,744 1,750,943,765
Net inter segment borrowing 1,276,657,658 499,009 443,631 1,277,600,298
Others 82,095,511 7,032,758 166,576 89,294,845
Total Liabilities 3,435,081,615 250,824,092 5,217,951 3,691,123,658
Equity 151,842,135 50,991,936 1,808,476 204,642,547
Total Equity & liabilities 3,586,923,750 301,816,028 7,026,427 3,895,766,205
Contingencies and Commitments 662,959,493 469,287,284 30,087 1,132,276,864

- - - #REF! -
2020
Export
Zones
------------------------------------------- (Rupees in '000) ---------------------------------------
Profit and Loss
Net mark-up / return / profit 67,227,461 7,433,417 298,294 74,959,172

Non mark-up / return / interest income 14,316,778 2,748,603 28,958 17,094,339
Total Income 81,544,239 10,182,020 327,252 92,053,511
Segment direct expenses 35,848,058 5,223,825 21,010 41,092,893

Inter segment expense allocation (539,126) 536,869 2,257 -
Total expenses 35,308,932 5,760,694 23,267 41,092,893
Provisions - net (1,915,035) (14,853,113) - (16,768,148)
Profit / (loss) before tax 44,320,272 (10,431,787) 303,985 34,192,470
59
2020
Export
Zones
------------------------------------------- (Rupees in '000) ---------------------------------------
Balance Sheet
Cash & Bank balances 217,347,898 47,335,696 43,223 264,726,817

Investments 1,005,423,165 116,564,187 6,687,142 1,128,674,494
Net inter segment lending 1,224,954,825 - - 1,224,954,825
Lendings to financial institutions 19,959,132 - - 19,959,132
Advances - performing 429,292,352 89,098,600 20,469 518,411,421
Advances - non-performing net of provision 4,113,132 7,754,943 - 11,868,075
Others 92,449,475 13,036,360 265,906 105,751,741
Total Assets 2,993,539,979 273,789,786 7,016,740 3,274,346,505
Borrowings 119,665,849 9,321,566 - 128,987,415

Subordinated debt 10,000,000 - - 10,000,000
Deposits & other accounts 1,420,196,563 214,733,420 5,281,918 1,640,211,901
Net inter segment borrowing 1,224,199,750 752,817 2,258 1,224,954,825
Others 79,813,515 6,141,982 163,960 86,119,457
Total Liabilities 2,853,875,677 230,949,785 5,448,136 3,090,273,598
Equity 139,664,302 42,840,001 1,568,604 184,072,907
Total Equity & liabilities 2,993,539,979 273,789,786 7,016,740 3,274,346,505
- - - -
Contingencies and Commitments 656,744,525 398,335,422 163,265 1,055,243,212
Transactions between reportable segments are based on an appropriate transfer pricing mechanism using agreed rates.
42. TRUST ACTIVITIES
The Bank acts as a custodian for securities held in Investor Portfolio Securities (IPS) accounts. These are not assets of the
Bank and, therefore, are not included in these unconsolidated financial statements. Assets held under trust in IPS accounts
are shown in the table below:
2021
Securities held (Face Value)
Number of
Pakistan Market
Category IPS GoP Ijara Total
Investment Treasury
Accounts Sukuks
Bonds Bills
------------------------------------------ (Rupees in '000) ----------------------------------------
Asset Management Companies 1 - 783,000 - 783,000

Corporates 13 6,080,000 - 8,283,000 14,363,000
Individuals 40 44,700 - 1,767,590 1,812,290
Insurance Companies 7 350,617,700 210,000 3,458,000 354,285,700
NGO / Charitable Organisation 4 550,000 - 2,790,300 3,340,300
Pension & Employee Funds 32 47,275,200 175,000 8,425,700 55,875,900
Others 13 4,512,900 - 3,037,730 7,550,630
Total 110 409,080,500 1,168,000 27,762,320 438,010,820
2020
Securities held (Face Value)
Number of
Pakistan GoP Ijara Market
Category IPS Total
Investment Sukuks Treasury
Accounts
Bonds Bills
------------------------------------------ (Rupees in '000) ----------------------------------------
Asset Management Companies 1 - 1,110,500 - 1,110,500

Corporates 7 4,246,500 - 3,237,500 7,484,000
Individuals 43 154,900 - 1,447,770 1,602,670
Insurance Companies 7 372,299,700 413,000 2,352,000 375,064,700
NGO / Charitable Organisation 4 400,000 - 739,300 1,139,300
Pension & Employee Funds 36 42,824,000 175,000 11,021,255 54,020,255
Others 15 2,500,700 - 4,124,345 6,625,045
Total 113 422,425,800 1,698,500 22,922,170 447,046,470
60
43. RELATED PARTY TRANSACTIONS
The Bank has related party transactions with its parent, directors, key management personnel, subsidiaries, associates and
other related parties including employee benefit schemes of the Bank.
The Bank enters into transactions with related parties in the ordinary course of business and on substantially the same terms
as for comparable transactions with person of similar standing. Contributions to and accruals in respect of staff retirement
benefits and other benefit plans are made in accordance with the actuarial valuations / terms of the contribution plan.
Remuneration to the executives / officers is determined in accordance with the terms of their appointment.
Details of transactions with related parties during the year, other than those which have been disclosed elsewhere in these
unconsolidated financial statements, are as follows:
2021
Key
Other related
Parent Directors management Subsidiaries Associates
parties
personnel
-----------------------------------------------------------------------------------------------------------------------
Statement of financial position (Rupees in '000) -------------------------------------------------------------------------
Balances with other banks

In current accounts - - - 478,967 - -
In deposit accounts - - - 1,765,018 - -
- - - 2,243,985 - -
Lendings to financial institutions

Opening balance - - - - - -
Addition during the year - - - - - 5,726,952
Repaid during the year - - - - - (3,371,837)
Transfer in / (out) - net - - - - - -
Closing balance - - - - - 2,355,115
Investments
Opening balance - - - 5,406,166 1,582,485 3,997,489
Investment made during the year - - - - 216,640 2,563,634
Investment disposed / written off during the year - - - (30,100) - (1,906,511)
Closing balance - - - 5,376,066 1,799,125 4,654,612
Provision for diminution in value of investments - - - 1,688,911 - 938,502
Provision written off - - - - - 77,606
Advances
Opening balance - 10 237,861 - - 9,365,687
Addition during the year - 1,170 87,189 - - 84,111,001
Repaid during the year - (535) (49,221) - - (93,474,920)
Transfers in - net - - 1,987 - - -
Closing balance - 645 277,816 - - 1,768
Provision held against advances - - - - - -
Other Assets
Interest mark-up accrued - - - 91 4,541 149,672
Receivable from staff retirement fund - - - - - 2,077,069
Prepaid insurance - - - - 65,811 -
Other receivable - - - 13,282 - -
Provision written off - - - - - 30,164
61
2021
Key
Other related
parties
personnel
----------------------------------------------------------------------------------------------------------------------- (Rupees in '000) -------------------------------------------------------------------------
Borrowings
Opening balance - - - 1,598,323 - -
Borrowings during the year - - - 2,834,585 - 488,300
Settled during the year - - - (4,432,908) - (488,300)
Closing balance - - - - - -
Deposits and other accounts

Opening balance - 6,431,790 62,761 598,007 4,285,435 14,387,025
Received during the year 101,751 30,758,130 1,048,423 27,454,331 180,782,484 240,407,932
Withdrawn during the year (83,150) (29,420,636) (1,074,629) (27,824,341) (182,858,765) (238,650,477)
Transfers in - net - - 29,622 - - 6,690
Closing balance 18,601 7,769,284 66,177 227,997 2,209,154 16,151,170
Other Liabilities
Interest / mark-up payable on deposits and borrowings - 33,314 1 - 11,222 76,214
Dividend payable 2,526,916 8,000 - - - 17,578
Payable to staff retirement fund - - - - - 103,685
Unearned income - - - 406 - 19,501
Other payable - - - - 13,613 -
Contingencies and Commitments

Letter of guarantee - - - 5,295 - -
Forward Government securities sale - - - - 199,000 -
Profit and loss account
Income
Mark-up / return / interest earned - - 14,405 13,335 36,684 508,576
Commission / charges recovered 22 333 3,118 1,410 28,237 24,814
Dividend income - - - 434,550 28,481 811,111
Net gain on sale of securities - 78 - - - -
Other income - - - 2,296 - 21,763
Gain on sale of fixed assets - - 7,041 - 556 -
Gain on wind-up of subsidiary - - - 103,993 - -
Reversal of provision - - - - - 528,488
Switch revenue - - - - - 241,157
Management fee - - - 21,970 - -
Expense
Mark-up / return / interest paid 862 401,218 2,946 12,150 168,159 933,291
Remuneration paid - - 833,225 - - -
Post employment benefits - - 7,171 - - -
Directors' fees and allowances - 75,300 - - - -
Charge for defined contribution plans - - 19,522 - - 393,269
Charge for defined benefit plans - - - - - 579,028
Other expenses - - - - - 110,279
Clearing charges - - - - - 132,758
Membership, subscription, sponsorship and
maintenance charges - - - - - 65,092
62
2021
Key
Other related
parties
personnel
----------------------------------------------------------------------------------------------------------------------- (Rupees in '000) -------------------------------------------------------------------------
Other Information
Dividend paid 10,502,493 253,519 6,279 - 125,384 1,820,822
Insurance premium paid - - - - 524,781 -
Insurance claims settled - - - - 524,094 -
2020
Key
Other related
parties
personnel
----------------------------------------------------------------------------------------------------------------------- (Rupees in '000) -------------------------------------------------------------------------
Statement of financial position
Balances with other banks

In current accounts - - - 1,482,280 - -
In deposit accounts - - - - - -
- - - 1,482,280 - -
Investments
Opening balance - - - 5,406,166 1,582,485 3,943,202
Investment made during the year - - - - - 54,287
Investment redeemed / disposed off during the year - - - - - -
Closing balance - - - 5,406,166 1,582,485 3,997,489
Provision for diminution in value of investments - - - 1,688,911 - 1,544,596
Advances
Opening balance - 4,624 220,133 - 2,155,149 12,715,998
Addition during the year - 838 72,462 - - 16,398,899
Repaid during the year - (5,452) (68,603) - (152,755) (19,749,210)
Transfers in / (out) - net - - 13,869 - (2,002,394) -
Closing balance - 10 237,861 - - 9,365,687
Provision held against advances - - - - - -
Other Assets
Interest mark-up accrued - - - - 4,282 232,471
Receivable from staff retirement fund - - - - - -
Advances, deposits & prepayments - - - - - 63,634
Prepaid insurance - - - - 1,002 -
Dividend receivable - - - - - 104,215
Other receivable - - - 11,983 - 30,164
Provision against other assets - - - - - 30,164
Borrowings
Opening balance - - - - - -
Borrowings during the year - - - 1,760,102 - 1,538,000
Settled during the year - - - (161,779) - (1,538,000)
Closing balance - - - 1,598,323 - -
63
2020
Key
Other related
parties
personnel
----------------------------------------------------------------------------------------------------------------------- (Rupees in '000) -------------------------------------------------------------------------
Deposits and other accounts
Opening balance - 8,679,450 49,368 314,527 6,539,020 11,208,008
Received during the year - 29,415,769 1,265,710 19,236,267 147,659,042 170,582,211
Withdrawn during the year - (31,659,519) (1,192,377) (18,952,787) (149,912,627) (167,409,735)
Transfers (out) / in - net - (3,910) (59,940) - - 6,541
Closing balance - 6,431,790 62,761 598,007 4,285,435 14,387,025
Other Liabilities
Interest / mark-up payable on deposits and borrowings - 39,335 210 1,182 14,748 107,927
Payable to staff retirement fund - - - - - 1,118,539
Unearned income - - - 1,485 - -
Other payable - 3,900 - - 22,353 -
Contingencies and Commitments

Letter of guarantee - - - 11,053 - 4,360
Forward foreign exchange contracts purchase - - - 1,777,719 - -
Forward foreign exchange contracts sale - - - 1,758,178 - -
Profit and loss account
Income
Mark-up / return / interest earned - - 15,823 87,462 34,835 1,220,364
Commission / charges recovered - 61 3,751 1,094 24,666 23,059
Dividend income - - - 379,039 18,472 175,794
Net gain on sale of securities - - - - - -
Other income - - - 2,285 524 15,359
Gain on sale of fixed assets - - 7,166 - 7,063 -
Reversal of provision - - - - 152,755 -
Switch revenue - - - - - 220,127
Management fee - - - 2,548 - -
Expense
Mark-up / return / interest paid - 184,964 663 20,778 379,796 331,471
Remuneration paid - - 670,774 - - -
Post employment benefits - - 6,953 - - -
Non-executive directors' fee - 86,200 - - - -
Charge for defined contribution plans - - 16,612 - - 364,906
Charge for defined benefit plans - - - - - 272,592
Other expenses - - - 14,922 - 44,875
Clearing charges - - - - - 138,487
Membership, subscription, sponsorship and
maintenance charges - - - - - 15,604
Custody charges - - - - - 4,757
Other Information
Dividend paid 3,490,302 93,435 1,657 - 18,310 552,936
Insurance premium paid - - - - 536,298 -
Insurance claims settled - - - - 485,047 -
43.1 As disclosed in note 8.13, with reference to orderly winding up of UBL (Switzerland) AG, during the year ended December 31,
2021, UBL - UAE branch has acquired certain exposures relating to bills discounting from UBL (Switzerland) AG. These
transactions have not resulted in any kind of exposure between UBL - UAE and UBL (Switzerland) AG and are hence not
presented in the above disclosure.
64
44. CAPITAL ADEQUACY, LEVERAGE RATIO & LIQUIDITY REQUIREMENTS 2021 2020
------- (Rupees in '000) -------
Minimum Capital Requirement (MCR):
Paid-up capital (net of losses) 12,241,797 12,241,797
Capital Adequacy Ratio (CAR):

Eligible Common Equity Tier 1 (CET 1) Capital 130,899,755 126,860,060
Eligible Additional Tier 1 (ADT 1) Capital 9,825,628 9,934,770
Total Eligible Tier 1 Capital 140,725,383 136,794,830
Eligible Tier 2 Capital 45,533,655 45,102,462
Total Eligible Capital (Tier 1 + Tier 2) 186,259,038 181,897,292
Risk Weighted Assets (RWAs):

Credit Risk 622,392,344 532,509,650
Market Risk 75,576,397 54,441,838
Operational Risk 166,790,557 157,614,605
Total 864,759,298 744,566,093
Common Equity Tier 1 Capital Adequacy Ratio 15.14% 17.04%

Tier 1 Capital Adequacy Ratio 16.27% 18.37%
Total Capital Adequacy Ratio 21.54% 24.43%
The SBP through its BSD Circular No. 07 dated April 15, 2009 has prescribed the minimum paid-up capital (net of
accumulated losses) for Banks to be raised to Rs.10,000 million by the year ending December 31, 2015. The paid-up
capital of the Bank for the year ended December 31, 2021 stood at Rs.12,241.797 million (2020: Rs.12,241.797 million)
and is in compliance with SBP requirements. Banks are also required to maintain a minimum Capital Adequacy Ratio
(CAR) of 10.0% plus capital conservation buffer of 2.5% and High Loss Absorbency Requirement of 1.0% of the risk
weighted exposures of the Bank.
In order to dampen the effects of COVID-19, the State Bank of Pakistan under BPRD Circular Letter No. 12 of 2020 has
given a regulatory relief and reduced the Capital Conservation Buffer (CCB) as prescribed vide BPRD Circular No. 6 of
August 15, 2013, for the time being, from its existing level of 2.5% to 1.5%, till further instructions.
Further, under Basel III instructions, Banks are also required to maintain a Common Equity Tier 1 (CET 1) ratio and Tier 1
ratio of 6.0% and 7.5%, respectively, as at December 31, 2021. The Bank is fully compliant with prescribed ratios as the
Bank’s CAR is 21.54% whereas CET 1 and Tier 1 ratios stood at 15.14% and 16.27% respectively.
Furthermore, under the SBP’s Framework for Domestic Systemically Important Banks (D-SIBs) introduced vide BPRD
Circular No. 04 of 2019 dated April 13, 2019, UBL is a sample D-SIB. In line with this framework, the Bank is required to
meet the Higher Loss Absorbency (HLA) capital charge of 1.0%, in the form of Additional CET 1 capital.
Under the current capital adequacy regulations, credit risk and market risk exposures are measured using the Standardised
Approach and operational risk is measured using the Basic Indicator Approach. Credit risk mitigants are applied against the
Bank’s exposures based on eligible collateral under comprehensive approach.
2021 2020
------------- (Rupees in '000) -------------
Leverage Ratio (LR):
Eligible Tier-1 Capital 140,725,383 136,794,830
Total Exposures 3,498,758,906 2,456,802,603
Leverage Ratio 4.02% 5.57%
Liquidity Coverage Ratio (LCR):

Total High Quality Liquid Assets 1,597,732,985 1,035,616,032
Total Net Cash Outflow 476,786,878 324,975,005
Liquidity Coverage Ratio 335.10% 318.68%
Net Stable Funding Ratio (NSFR):

Total Available Stable Funding 2,409,606,992 1,714,566,321
Total Required Stable Funding 1,341,535,238 770,865,635
Net Stable Funding Ratio 179.62% 222.42%
44.1 The full disclosures on the CAPITAL ADEQUACY, LEVERAGE RATIO & LIQUIDITY REQUIREMENTS as per SBP
instructions issued from time to time are placed on the website. The link to the full disclosure is available at
https://www.ubldigital.com/Investor-Relations/CAR-Statements.aspx.
65
45. RISK MANAGEMENT
The Bank has an integrated risk management structure in place covering domestic and international operations. The Board
Risk and Compliance Committee (BRCC), a sub-committee of the Board of Directors (BoD); oversees the entire risk
management process of the Bank. Furthermore, Risk Management Committee (RMC) oversees all risks collectively at
senior management level. The Committee is chaired by the President and comprises of Heads of all major areas such as
Risk, Finance and Business Groups. The Risk and Credit Policy Group led by Chief Risk Officer (CRO) is responsible for
the development and implementation of all risk policies approved by the BoD in line with the guidelines issued by SBP. The
group is organized into various functions such as Credit Risk Management, Credit Policy & Research, Market & Treasury
Risk, Financial Institution Risk, Consumer Credit Policy, Operational Risk & Basel and Information Security Risk. The role
of the Risk and Credit Policy Group includes:
- Determining guidelines relating to the Bank’s risk appetite.

- Reviewing risks on an aggregate and enterprise level
- Recommending risk management policies in accordance with the Prudential Regulations, Basel II / III framework,
Regulatory framework of foreign countries where the bank operates and international best practices.
- Reviewing policies / manuals and ensuring that these are in accordance with BRCC / BoD approved risk management
policies.
- Approving credits and granting approval authority to qualified and experienced individuals.
- Portfolio reviews focusing on quality assessment, risk profiles, industry concentrations etc.
- To identify problem credits and level of provisioning required.
- To establish an extensive Information Security (IS) Program and governance structure to manage the Security of the
Information assets.
45.1 During the year, continued resurgence in COVID-19 variants weakened the momentum and raised uncertainty in sustaining
global economic recovery at various intervals. As global economies gradually recover, a bull run in the global commodity
market emerged due to pent up demand. Pakistan being a net importer and marred with imported inflation, struggled to
keep its growth on track and fiscal balance amid IMF’s tough conditions.
Higher global commodity prices widened the current account deficit, stoked higher inflation, deteriorated foreign exchange
reserves and the exchange rate. Resultantly, the State Bank intervened and took steps such as:
i) Increasing the interest rates by 275 basis points to 9.75%

ii) Escalating import duties
iii) Tightening of consumer debt burden ratio; to curb demand side pressures and entrench the attained growth.
COVID-19 has impacted banks on a number of fronts including increase in the overall credit risk pertaining to loans
advances portfolio and reduced fee income due to overall economic slowdown. With the emergence of the Omicron wave
such risks are expected to remain prevalent. However, with rapid vaccination drives in place and necessary measures
being taken; the impact is expected to be contained without compromising economic growth substantially.
45.2 Credit risk
Credit risk is the risk that a customer or counterparty may not settle an obligation for full value, either when due or at any
time thereafter. This risk arises from the potential that a customer's or counterparty’s willingness or ability to meet such an
obligation is impaired, resulting in an economic loss to the Bank.
The credit risk management process is driven by the Bank's Risk Management Policy, Credit Policy for Corporate,
Commercial, SME & Agri, Collateral Management Policy, Credit Policy of respective overseas operation, which provide
guidance in relation to credit initiation, approval, documentation and disbursement, credit maintenance and remedial
management process.
Individual credit authorities are delegated to credit officers by the Group Executive - Risk & Credit Policy (authorized by
BoD), according to their seasoning / maturity. Approvals for Consumer loans are centralized, while approval authorities for
overseas operations, Corporate, Commercial, SME and Agri exposures are delegated at a Country / Regional level.
Furthermore, credit authorities are also delegated to business teams in various regions for Commercial, SME & Agri
lending. All credit policy functions globally are centrally organized. The bank is also in the process of automating the credit
initiation and approval work flow.
66
Concentration of credit risk exists if clients are engaged in similar activities, or are located in the same geographical region,
or have comparable economic characteristics such that their ability to meet contractual obligations would be similarly
affected by changes in economic, political or other conditions. The Bank manages, limits and controls concentrations of
credit risk to individual counterparties and groups, and to industries, where appropriate. Limits are also applied to portfolios
or sectors where the Bank considers it appropriate to restrict credit risk concentrations, or to areas of higher risk, or to
control the rate of portfolio growth. To manage cross border exposure, the bank has a Country Risk Policy in place which
provides the framework for managing Country and FI related risks.
The Risk Management function of the Bank regularly conducts assessments of the credit portfolio to identify borrowers
most likely to get affected due to changes in the continuously evolving business and economic environment. The Bank has
been continuously reviewing the portfolio, to identify accounts susceptible to higher risk, resulting from the ongoing COVID-
19 outbreaks.
IFRS 9 is applicable currently on the international branches of the Bank and requires the estimation of Expected Credit
Losses (ECL) based on various parameters such as client fundamentals, credit structure, historical portfolio default rate
and transitions i.e. probability of default, loss given default as well as current and forecasted macro-economic variables.
The Bank has reviewed the potential impact of the COVID-19 outbreak on the inputs and assumptions for IFRS 9 ECL
measurement in light of available information. Overall, the COVID-19 situation remains fluid and continues to be rapidly
evolving, which makes it challenging to reliably reflect impacts in ECL estimates at any given point in time. However, the
Bank has been assessing the situation as it develops and has accounted for the same in its ECL estimates based on best
judgment as well as Regulatory guidelines of each overseas jurisdiction.
45.2.1 Lendings to financial institutions
Credit risk by public / private sector Gross lendings Non-performing lendings Provision held
2021 2020 2021 2020 2021 2020
------------------------------------------------------------------------------------------ (Rupees in '000) -----------------------------------------------------------------------------------
Public / Government 19,123,292 6,433,114 - - - -
Private 32,577,784 13,526,018 - - - -
51,701,076 19,959,132 - - - -
45.2.2 Investment in debt securities
Credit risk by industry sector Gross investments Non-performing investments Provision held
2021 2020 2021 2020 2021 2020
------------------------------------------------------------------------------------------ (Rupees in '000) -----------------------------------------------------------------------------------
Chemical and pharmaceuticals 54,351 61,263 54,351 61,262 54,351 61,262

Fertilizers - 170,400 - - - -
Financial 1,468,255,470 1,095,998,832 - - - -
Food 912 912 912 912 912 912
Production and transmission of energy 15,552,505 14,577,319 - - - -
Metal and allied 250,000 - - - - -
Textile 486,407 529,264 228,925 228,925 228,925 228,925
Others 1,826,836 799,800 1,397 1,397 1,397 1,397
1,486,426,481 1,112,137,790 285,585 292,496 285,585 292,496
Gross investments Non-performing investments Provision held

2021 2020 2021 2020 2021 2020
------------------------------------------------------------------------------------------ (Rupees in '000) -----------------------------------------------------------------------------------
Credit risk by public / private sector
Public / Government 1,474,328,831 1,022,772,243 - - - -

Private 12,097,650 89,365,547 285,585 292,496 285,585 292,496
1,486,426,481 1,112,137,790 285,585 292,496 285,585 292,496
67
45.2.3 Advances
Credit risk by industry sector Gross advances Non-performing advances Provision held
2021 2020 2021 2020 2021 2020

----------------------------------------------------------------------------------------------------- (Rupees in '000) -----------------------------------------------------------------------------------
Agriculture 8,176,227 7,598,682 696,371 1,170,019 413,421 599,102

Airlines 541,988 5,401,008 541,988 1,452,187 541,988 1,452,187
Automobile and transportation equipment 17,068,006 12,951,474 123,939 125,409 123,939 122,109
Education and medical 58,064 - - - - -
Cables 1,381,760 1,026,167 586,751 616,751 586,751 616,751
Cement 8,848,609 8,822,532 349,947 285,636 349,947 285,636
Chemical and pharmaceuticals 8,030,266 6,336,985 91,984 113,399 91,984 113,399
Construction 32,987,172 22,498,752 9,821,929 7,112,201 8,776,121 6,159,594
Contractors - 4,753,204 - 1,120,451 - 1,120,451
Electronics and electrical appliances 15,121,471 10,092,057 10,246,873 8,367,344 8,040,748 6,366,180
Engineering 915,514 15,557,031 34,632 1,516,238 34,632 446,044
Fertilizer 10,007,744 11,819,949 64,682 63,246 60,932 61,996
Financial 44,508,765 42,955,164 3,999,205 3,530,909 3,999,205 3,530,909
Food, tobacco and beverages 80,538,773 70,617,073 5,719,233 7,212,424 3,976,694 5,609,657
Glass and allied 554,401 277,867 - - - -
Hotel and tourism 1,651,600 2,190,534 369,697 595,259 369,697 595,259
Individuals 40,674,544 48,150,725 10,468,858 8,076,206 8,541,939 5,678,232
Paper and allied 2,017,238 2,013,682 13,991 639,480 13,991 628,987
Polyester and fiber 1,857,979 3,280,957 1,577,051 1,577,051 1,577,051 1,577,051
Production and transmission of energy 203,802,341 155,746,888 8,701,745 5,068,974 7,089,870 3,391,991
Shoes and leather garments 2,019,904 2,816,497 929,492 2,191,352 929,492 2,189,602
Sports goods - 173,915 - 4,300 - 4,300
Sugar 4,183,878 4,454,866 169,729 175,729 169,729 175,729
Metal and allied 6,597,346 200,557 408,300 - 408,300 -
Telecommunication 31,364,524 24,101,854 58,511 3,293,224 58,511 3,293,224
Textile composite 79,450,444 40,862,679 3,201,074 3,782,368 3,201,074 3,782,368
Textile 16,891,919 11,232,898 3,019,595 2,047,876 3,013,468 2,041,748
Textile spinning 18,531,359 12,912,492 2,399,319 3,662,420 2,399,319 3,662,420
Textile weaving 4,802,142 5,975,856 69,291 351,348 69,291 351,348
Wholesale and retail trade 27,726,220 38,286,130 15,991,045 11,210,283 15,382,883 10,600,840
Others 57,975,377 36,198,533 6,357,792 8,261,659 4,482,880 7,298,554
728,285,575 609,307,008 86,013,024 83,623,743 74,703,857 71,755,668

Gross advances Non-performing advances Provision held
2021 2020 2021 2020 2021 2020

--------------------------------------------------------------- (Rupees in '000) ---------------------------------------------------------------
Public / Government 225,945,664 204,260,276 1,089,669 1,089,630 22,348 22,313

Private 502,339,911 405,046,732 84,923,355 82,534,113 74,681,509 71,733,355
728,285,575 609,307,008 86,013,024 83,623,743 74,703,857 71,755,668
68
2021 2020
------- (Rupees in '000) -------
45.2.4 Contingencies and Commitments
Credit risk by industry sector

Agri business 13,528,192 17,715,477
Airlines 70,243 2,262,738
Automobile and transportation equipment 4,475,318 1,957,467
Cables 266,556 574,708
Cement 3,329,371 2,795,619
Chemical and pharmaceuticals 4,088,189 4,929,608
Construction 5,818,193 5,062,724
Contractors 235,252 1,782,745
Electronics and electrical appliances 3,407,536 2,473,426
Engineering 8,294,865 9,018,950
Fertilizer dealers 7,087,353 5,651,372
Financial 759,770,819 697,641,219
Food, tobacco and beverages 6,777,604 5,254,917
Glass and allied 291,706 186,220
Hotel and tourism 2,247,647 2,015,989
Individuals 8,631,596 18,277,661
Paper and allied 1,732,281 1,686,887
Polyester and fiber 7,885,097 2,829,494
Production and transmission of energy 133,134,614 127,733,243
Shoes and leather garments 60,030 30,075
Sugar 330,827 58,914
Telecommunication 6,603,098 6,024,903
Textile 25,195,707 16,693,930
Wholesale traders 31,748,588 1,434,752
Others 97,266,182 121,150,174
1,132,276,864 1,055,243,212
Public / Government 236,113,927 256,923,452
Private 896,162,937 798,319,760
1,132,276,864 1,055,243,212
45.2.5 Concentration of Advances
The Bank's top 10 exposures on the basis of total (funded and non-funded exposures) aggregated to Rs. 334,457 million
(2020: Rs. 284,824 million) are as follows:
2021 2020
------- (Rupees in '000) -------
Funded 190,484,427 140,816,028

Non-funded 143,973,021 144,008,127
Total exposure 334,457,448 284,824,155
The sanctioned limits against these top 10 exposures aggregated to Rs. 372,084 million (2020: Rs. 306,651 million).
None of the exposure against these top 10 exposures is classified.
For the purpose of this note, exposure means outstanding funded facilities and utilised non-funded facilities as at the
reporting date.
69
45.2.6 Advances - Province / Region-wise Disbursement & Utilisation
2021
Utilisation
Province / Region Disburse-
KPK including AJK including
ments Punjab Sindh Balochistan Islamabad
FATA Gilgit-Baltistan
--------------------------------------------------------------------------------------------- (Rupees in '000) ---------------------------------------------------------------------------------------------
Punjab 135,635,546 135,635,546 - - - - -

Sindh 98,628,525 - 98,628,525 - - - -
KPK including FATA 2,584,512 - - 2,584,512 - - -
Balochistan 15,842 - - - 15,842 - -
Islamabad 16,255,365 - - - - 16,255,365 -
AJK including Gilgit-Baltistan 22,810 - - - - - 22,810
Total 253,142,600 135,635,546 98,628,525 2,584,512 15,842 16,255,365 22,810
2020
Utilisation
Province / Region Disburse-
KPK including AJK including
ments Punjab Sindh Balochistan Islamabad
FATA Gilgit-Baltistan
--------------------------------------------------------------------------------------------- (Rupees in '000) ---------------------------------------------------------------------------------------------
Punjab 127,665,134 127,665,134 - - - - -

Sindh 195,268,735 - 195,268,735 - - - -
KPK including FATA 986,009 - - 986,009 - - -
Balochistan 826,969 - - - 826,969 - -
Islamabad 117,094,564 - - - - 117,094,564 -
AJK including Gilgit-Baltistan 119,277 - - - - - 119,277
Total 441,960,688 127,665,134 195,268,735 986,009 826,969 117,094,564 119,277
45.3 Market Risk
Market risk is the risk of changes in market conditions that may adversely impact the value of assets or liabilities, following
a negative impact on earnings. Market risk mainly arises from trading activities carried out by Treasury and Capital Market
(TCM) like lending / borrowing, Investments and client facilitating activities.
To manage Market Risk, a well-defined Market Risk policy approved by the Board of Directors is in place. The policy
defines appropriate risk measures, controls and methods carried out for proactive market risk management.
The Bank carries out market risk management through effective risk measurement tools including Value at Risk (VaR),
Price Value per Basis Point (PVBP), Duration, Beta, and Expected Shortfall on regular basis. Bank also ascertains the
impact of changes in market factors on Bank’s earnings through regular stress testing and Internal Capital Adequacy
Assessment Processes (ICAAP).
45.3.1 Balance sheet split by trading and banking books
2021 2020
Banking Trading Banking Trading
Total Total
book book book book
------------------------------------------------------------------------ (Rupees in '000) ------------------------------------------------------------------------
Cash and balances with treasury banks 267,937,282 - 267,937,282 250,838,052 - 250,838,052
Balances with other banks 23,363,057 - 23,363,057 13,888,765 - 13,888,765
Lendings to financial institutions 51,701,076 - 51,701,076 19,959,132 - 19,959,132
Investments 510,155,569 986,386,884 1,496,542,453 434,377,680 694,296,814 1,128,674,494
Advances 646,188,457 - 646,188,457 530,279,496 - 530,279,496
Fixed assets 68,537,653 - 68,537,653 51,207,703 - 51,207,703
Intangible assets 2,231,265 - 2,231,265 1,829,211 - 1,829,211
Deferred tax assets 7,204,275 - 7,204,275 6,399,267 - 6,399,267
Other assets 54,460,389 - 54,460,389 46,315,560 - 46,315,560
1,631,779,023 986,386,884 2,618,165,907 1,355,094,866 694,296,814 2,049,391,680
70
45.3.2 Foreign Exchange Risk
Foreign exchange (FX) risk arises from the fluctuation in the value of assets and liabilities due to the changes in foreign
exchange rates.
The FX risk and associated concentration risk is managed through approved currency wise net open position limits, tenor
wise limits and an overall FEE limit.
The currency risk is effectively monitored against the applicable regulatory limits. Market risk monitors that the FX exposure
remains under limits prescribed by SBP and Internal Limits approved by GALCO.
2021 2020
Foreign Foreign Net foreign Foreign Foreign Net foreign
Off-balance Off-balance
Currency Currency currency Currency Currency currency
sheet items sheet items
Assets Liabilities exposure Assets Liabilities exposure
---------------------------------------------------------------------------------------------- (Rupees in '000) ------------------------------------------------------------------------------------
United States Dollar 234,596,295 136,795,093 (102,559,248) (4,758,046) 200,545,109 119,630,099 (80,120,668) 794,342
Great Britain Pound 2,087,074 21,469,450 20,009,696 627,320 3,810,575 19,901,304 16,561,167 470,438
Japanese Yen 30,118 99,659 70,978 1,437 115,813 98,074 (16,149) 1,590
Euro 2,777,761 8,076,568 5,299,402 595 3,605,786 8,234,827 4,725,445 96,404
UAE Dirham 68,981,715 168,285,202 100,557,440 1,253,953 73,955,103 156,890,634 81,890,688 (1,044,843)
Bahraini Dinar 16,963,843 29,179,381 12,281,281 65,743 13,936,810 26,800,952 11,751,534 (1,112,608)
Qatari Riyal 15,801,817 34,055,642 16,847,242 (1,406,583) 16,168,969 28,718,594 12,279,612 (270,013)
Other Currencies 8,349,602 6,357,272 (2,086,131) (93,801) 3,867,084 5,311,469 1,387,653 (56,732)
349,588,225 404,318,267 50,420,660 (4,309,382) 316,005,249 365,585,953 48,459,282 (1,121,422)
2021 2020
book book book book
----------------------------------------------------- (Rupees in '000) -----------------------------------------
Impact of 1% change in foreign exchange rates on
- Profit and loss account - - - -
- Other comprehensive income 43,094 - 11,214 -
45.3.3 Equity Position Risk
Equity risk is the risk that the fair value of an equity instrument will fluctuate due to changes in the prices of individual
stocks or market indices.
To manage equity risk, The Bank has a well-defined criterion for identifying the Investible Universe based on the Market
Capitalization & Average Daily Traded Value.
The Bank has an active and regular monitoring mechanism for utilization against approved portfolio limits, scrip wise limits,
sector limits and timely escalation of Management Action Trigger Levels (MAT).
2021 2020
book book book book
----------------------------------------------------- (Rupees in '000) -----------------------------------------
Impact of 5% change in equity prices on,
- Profit and loss account - - - -
- Other comprehensive income 25,348 495,409 22,096 530,589
45.3.4 Yield / Interest Rate Risk in the Banking Book (IRRBB) - Basel II Specific
Interest rate risk is the risk that fair value of a financial instrument will fluctuate as a result of changes in interest rates,
including changes in the shape of yield curves. Interest rate risk is inherent in the overall business of the Bank and arises
from mismatches between the contractual maturities and the re-pricing of on and off-balance sheet assets and liabilities.
Interest rate risk is monitored and managed by performing periodic gap analysis, sensitivity analysis and stress testing. In
case of any distressed event the results and corresponding action plan is presented at the relevant management / BoD
committee.
2021 2020
book book book book
----------------------------------------------------- (Rupees in '000) -----------------------------------------
Impact of 1% change in interest rates on
- Profit and loss account - 271,551 - 3,363
- Other comprehensive income 4,481,288 3,743,314 4,314,788 1,731,516
71
45.3.5 Mismatch of interest rate sensitive assets and liabilities
2021
Effective Exposed to yield / interest rate risk
Non-interest
yield /
Total Over 1 month to 3 Over 3 months Over 6 months Over 1 year to Over 2 years to Over 3 years to Over 5 years to bearing financial
interest Upto 1 month Over 10 years
months to 6 months to 1 year 2 years 3 years 5 years 10 years instruments
rate
% ------------------------------------------------------------------------------------------------------------------ (Rupees in '000) ------------------------------------------------------------------------------------------------------------------
On-balance sheet financial instruments
Assets
Cash and balances with treasury banks 0.05% 267,937,282 21,534,360 - - - - - - - - 246,402,922
Balances with other banks 0.09% 23,363,057 15,299,235 - - - - - - - - 8,063,822
Lendings to financial institutions 7.50% 51,701,076 49,726,776 100,000 - - - - - - - 1,874,300
Investments 7.69% 1,496,542,453 225,642,341 469,873,317 338,463,178 75,787,678 58,712,295 81,679,413 158,927,804 71,183,667 - 16,272,760
Advances 6.99% 646,188,457 142,793,407 275,100,546 134,276,596 24,254,242 5,800,666 8,329,733 25,935,142 19,038,969 - 10,659,156
Other assets 47,909,930 - - - - - - - - - 47,909,930
2,533,642,255 454,996,119 745,073,863 472,739,774 100,041,920 64,512,961 90,009,146 184,862,946 90,222,636 - 331,182,890
Liabilities
Bills payable 26,792,970 - - - - - - - - - 26,792,970
Borrowings 5.59% 563,284,750 193,472,011 308,898,301 29,235,370 3,193,722 819,011 933,173 5,072,718 19,864,822 - 1,795,622
Deposits and other accounts 3.30% 1,750,943,765 98,141,230 710,518,143 56,792,210 38,176,597 3,479,371 31,716,831 3,235,735 3,226,951 - 805,656,697
Subordinated debt 9.01% 10,000,000 10,000,000 - - - - - - - - -
Other liabilities 38,117,919 - - - - - - - - - 38,117,919
2,389,139,404 301,613,241 1,019,416,444 86,027,580 41,370,319 4,298,382 32,650,004 8,308,453 23,091,773 - 872,363,208
On-balance sheet gap 144,502,851 153,382,878 (274,342,581) 386,712,194 58,671,601 60,214,579 57,359,142 176,554,493 67,130,863 - (541,180,318)
Off-balance sheet financial instruments

FX Options - Purchase 904,470 444,570 406,245 53,655 - - - - - - -
FX Options - Sale (904,470) (444,570) (406,245) (53,655) - - - - - - -
Forward Government Securities - Purchase 9,081,000 - 9,081,000 - - - - - - - -
Forward Government Securities - Sale (2,699,000) (199,000) - (2,500,000) - - - - - - -
Foreign currency forward - Purchase 350,490,749 119,999,522 131,305,173 77,552,945 21,633,109 - - - - - -
Foreign currency forward - Sale (301,891,670) (62,401,945) (184,267,268) (44,332,343) (10,890,114) - - - - - -
Off-balance sheet Gap 54,076,609 56,954,007 (44,287,340) 30,666,947 10,742,995 - - - - - -
Total Yield / Interest Rate Risk Sensitivity Gap 210,336,885 (318,629,921) 417,379,141 69,414,596 60,214,579 57,359,142 176,554,493 67,130,863 - (541,180,318)
Cumulative Yield / Interest Rate Risk Sensitivity Gap 210,336,885 (108,293,036) 309,086,105 378,500,701 438,715,280 496,074,422 672,628,915 739,759,778 739,759,778 198,579,460
72
2020
Effective Exposed to yield / interest rate risk Non-interest
yield /
Total Over 1 month to 3 Over 3 months Over 6 months Over 1 year to Over 2 years to Over 3 years to Over 5 years to bearing financial
interest Upto 1 month Over 10 years
months to 6 months to 1 year 2 years 3 years 5 years 10 years instruments
rate
----------------------------------------------------------------------------------------------------------------------------------------------------
% (Rupees in '000) -----------------------------------------------------------------------------------------------------------------------------------------------
On-balance sheet financial instruments
Assets
Cash and balances with treasury banks 0.07% 250,838,052 14,636,825 - - - - - - - - 236,201,227
Balances with other banks 1.47% 13,888,765 4,535,935 - - - - - - - - 9,352,830
Lendings to financial institutions 9.00% 19,959,132 18,959,132 1,000,000 - - - - - - - -
Investments 9.54% 1,128,674,494 99,704,221 339,731,672 300,860,675 79,376,250 107,521,913 4,278,010 47,141,321 83,413,637 - 66,646,795
Advances 9.11% 530,279,496 22,539,678 294,575,740 126,300,245 17,838,256 6,145,891 4,958,021 10,243,123 26,965,990 7,813,770 12,898,782
Other assets 36,406,306 - - - - - - - - - 36,406,306
1,980,046,245 160,375,791 635,307,412 427,160,920 97,214,506 113,667,804 9,236,031 57,384,444 110,379,627 7,813,770 361,505,940
Liabilities
Bills payable 29,733,813 - - - - - - - - - 29,733,813
Borrowings 6.97% 128,987,415 64,139,213 21,645,935 6,870,621 12,189,517 1,245,978 1,422,721 21,087,774 - - 385,656
Deposits and other accounts 4.02% 1,640,211,901 81,298,711 732,048,749 44,946,507 41,407,311 8,391,302 2,874,467 26,694,827 3,542,979 150 699,006,898
Subordinated debt 11.00% 10,000,000 10,000,000 - - - - - - - - -
Other liabilities 38,566,762 - - - - - - - - - 38,566,762
1,847,499,891 155,437,924 753,694,684 51,817,128 53,596,828 9,637,280 4,297,188 47,782,601 3,542,979 150 767,693,129
On-balance sheet Gap 132,546,354 4,937,867 (118,387,272) 375,343,792 43,617,678 104,030,524 4,938,843 9,601,843 106,836,648 7,813,620 (406,187,189)
Off-balance sheet financial instruments

Forward Government Securities - Purchase - - - - - - - - - - -
Forward Government Securities - Sale - - - - - - - - - - -
Foreign currency forward - Purchase 342,792,602 131,916,225 100,357,088 75,434,166 35,085,123 - - - - - -
Foreign currency forward - Sale (292,804,731) (124,114,829) (82,679,373) (50,909,910) (35,100,619) - - - - - -
Off-balance sheet Gap 49,987,871 7,801,396 17,677,715 24,524,256 (15,496) - - - - - -
Total Yield / Interest Rate Risk Sensitivity Gap 12,739,263 (100,709,557) 399,868,048 43,602,182 104,030,524 4,938,843 9,601,843 106,836,648 7,813,620 (406,187,189)
Cumulative Yield / Interest Rate Risk Sensitivity Gap 12,739,263 (87,970,294) 311,897,754 355,499,936 459,530,460 464,469,303 474,071,146 580,907,794 588,721,414 182,534,225
73
45.3.5.1 Reconciliation of Assets and Liabilities exposed to yield / interest rate risk with Total Assets and Liabilities
2021 2020 2021 2020

------- (Rupees in '000) ------- ------- (Rupees in '000) -------
Total financial assets as per note 45.3.5 2,533,642,255 1,980,046,245 Total financial liabilities as per note 45.3.5 2,389,139,404 1,847,499,891
Add: Non financial assets Add: Non financial liabilities
Fixed assets 68,537,653 51,207,703 Other liabilities 24,383,956 17,818,882
Intangible assets 2,231,265 1,829,211
Deferred tax assets 7,204,275 6,399,267
Other assets 6,550,459 9,909,254
Total assets as per statement of financial position 2,618,165,907 2,049,391,680 Total liabilities as per statement of financial position 2,413,523,360 1,865,318,773
45.4 Operational risk
Operational risk is recognized as the risk of loss resulting from inadequate or failed internal processes, people and systems or from external events.
In compliance with the Regulatory Guidelines, an Operational Risk Division is established within Risk & Credit Policy Group. Operational Risk Division is primarily responsible for the
oversight of operational risk management across the Bank including International locations. The implementation of operational risk management framework is supported by operational
risk management system and designated operational risk coordinators within different units across the Bank. The framework is in line with regulatory guidelines, international best
practices, flexible enough to implement in stages and permits the overall approach to evolve in response to organizational learning and future requirements.
In accordance with the Operational Risk framework, a database covering losses, control breaches and near misses is being maintained by the division. Major risk events are analysed
from the control breach perspective and mitigating controls are assessed on design and operating effectiveness. Quarterly updates on Operational Risk events are being presented to
the Senior Management and Board Risk & Compliance Committee of the Bank. Periodic workshops are conducted for Risk & Control Self-Assessment and key risk exposures are
identified and assessed against existing controls to evaluate improvement opportunities. Key Risk Indicators are also defined for monitoring of risk exposures. New products, systems,
activities and processes, are subject to comprehensive operational risk assessments, before implementation.
Business Continuity Plans have been implemented across the Bank, clearly defining the roles and responsibilities of respective stakeholders, and covering recovery strategy, IT and
structural backups, scenario and impact analyses and testing directives. Business Continuity Plans (BCP) for respective areas are in place and tested.
45.5 Liquidity risk
Liquidity risk is defined as the risk that a bank, though solvent, either does not have sufficient financial resources available to meet all its obligations and commitments as they fall due,
or can secure them only at excessive costs.
74
UBL actively manages the risk through a set of qualitative and quantitative risk management techniques. The Global Assets and Liabilities Management Committee (GALCO) of the
Bank is responsible for the oversight of liquidity management and meets on a monthly basis or more frequently, if required. The Bank’s approach to liquidity management 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
sustained damage to business franchises. A centralized approach is adopted, based on an integrated framework incorporating an assessment of all material known and expected
cash flows and the availability of collateral which could be used to secure additional funding if required. The framework entails careful monitoring and control of the daily liquidity
position, and regular liquidity stress testing under a variety of scenarios. These encompass both normal and stressed market conditions, including general market crises and the
possibility that access to markets could be impacted by a stress event affecting some part of the Bank’s business.
It is the Bank’s policy to maintain adequate liquidity at all times, in order to meet all obligations, repay depositors and fulfill commitments to lend under both normal and stressed
conditions, without incurring unacceptable losses or incurring damage to the business franchises. Liquidity Risk measures comprises of various risk management tools including
concentration ratios, Liquidity Coverage Ratio (LCR), Net Stable Funding Ratio (NSFR) and liquidity gaps.
The Bank has a comprehensive Contingency Funding Plan in place which clearly defines and identifies the trigger events that could cause a liquidity crisis and describes the actions to
be taken to manage the crisis and return the Bank to business as usual.
45.5.1 Maturities of assets and liabilities - based on contractual maturity of the assets and liabilities of the Bank
2021
Over 9
Over 1 to 7 Over 7 to 14 Over 14 days Over 1 to 2 Over 2 to 3 Over 3 to 6 Over 6 to 9 Over 1 to 2 Over 2 to 3 Over 3 to 5
Total Upto 1 Day months to 1 Over 5 Years
days days to 1 Month Months Months Months Months years years Years
year
--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- (Rupees in '000) ----------------------------------------------------------------------------------------------------------------------------------------------------------------
Assets
Cash and balances with
treasury banks 267,937,282 138,897,679 - - 129,039,603 - - - - - - - - -
Balances with other banks 23,363,057 17,013,050 - - 6,350,007 - - - - - - - - -
Lendings to financial institutions 51,701,076 - 34,698,714 13,078,062 2,546,544 100,000 - - - 1,184,885 92,871 - - -
Investments 1,496,542,453 21,914,947 - 80,993,788 124,921,095 24,550,363 275,428,915 43,007,200 63,344,158 37,842,993 125,294,458 81,020,342 294,641,303 323,582,891
Advances 646,188,457 46,552,356 28,098,828 27,872,866 47,242,800 13,996,399 150,058,997 69,710,308 24,904,389 32,453,048 51,003,789 43,950,350 63,505,763 46,838,564
Fixed assets 68,537,653 59,503 - 634 1,409 19,779 27,924 79,995 90,585 1,562,608 1,558,334 1,572,925 4,326,045 59,237,912
Intangible assets 2,231,265 - - - - 260 613 26,151 22,348 150,735 249,955 395,296 634,591 751,316
Deferred tax asset 7,204,275 - - - 7,204,275 - - - - - - - - -
Other assets 54,460,389 1,152,082 1,155,165 2,105,132 6,382,206 4,238,900 8,503,391 5,245,651 4,364,924 3,642,399 3,559,620 2,079,553 4,558,059 7,473,307
2,618,165,907 225,589,617 63,952,707 124,050,482 323,687,939 42,905,701 434,019,840 118,069,305 92,726,404 76,836,668 181,759,027 129,018,466 367,665,761 437,883,990
Liabilities
Bills payable 26,792,970 - - - 26,792,970 - - - - - - - - -
Borrowings 563,284,750 1,480,103 175,899,869 13,398,740 244,973 200,543,162 111,814,923 9,931,134 29,764 18,569,393 764,419 607,642 5,198,473 24,802,155
Deposits and other accounts 1,750,943,765 1,446,158,146 11,989,403 14,244,895 60,492,702 41,547,263 44,463,750 50,097,728 18,691,350 17,123,013 5,156,213 31,987,602 3,788,416 5,203,284
Subordinated debt 10,000,000 - - - - - - - - - - - - 10,000,000
Other liabilities 62,501,875 10,564,839 1,620,290 526,365 12,823,477 3,902,120 2,358,481 9,553,559 2,776,416 3,558,223 1,819,508 1,650,844 1,973,866 9,373,887
2,413,523,360 1,458,203,088 189,509,562 28,170,000 100,354,122 245,992,545 158,637,154 69,582,421 21,497,530 39,250,629 7,740,140 34,246,088 10,960,755 49,379,326
Net assets 204,642,547 (1,232,613,471) (125,556,855) 95,880,482 223,333,817 (203,086,844) 275,382,686 48,486,884 71,228,874 37,586,039 174,018,887 94,772,378 356,705,006 388,504,664
Share capital 12,241,797
Reserves 69,718,467
Surplus on revaluation of assets 38,056,329
Unappropriated profit 84,625,954
204,642,547
75
2020
Over 9
Over 1 to 7 Over 7 to 14 Over 14 days Over 1 to 2 Over 2 to 3 Over 3 to 6 Over 6 to 9 Over 1 to 2 Over 2 to 3 Over 3 to 5
Total Upto 1 Day months to 1 Over 5 Years
days days to 1 Month Months Months Months Months years years Years
year
--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- (Rupees in '000) ----------------------------------------------------------------------------------------------------------------------------------------------------------------
Assets
Cash and balances with
treasury banks 250,838,052 127,375,354 - - 123,462,698 - - - - - - - - -
Balances with other banks 13,888,765 7,352,829 5,033,491 639,338 863,107 - - - - - - - - -
Lendings to financial institutions 19,959,132 - 5,000,000 4,500,000 9,459,132 1,000,000 - - - - - - - -
Investments 1,128,674,494 18,949,010 - 686,207 65,057,047 16,791,291 157,358,330 144,162,841 68,119,281 22,153,944 130,634,546 40,664,538 133,394,425 330,703,034
Advances 530,279,496 21,409,075 5,321,819 6,359,416 55,412,543 15,884,179 74,173,452 90,347,710 22,772,430 42,655,158 60,557,343 44,829,028 50,979,056 39,578,287
Fixed assets 51,207,703 - - - 308,690 - 483,463 796,145 - 923,884 2,358,874 2,263,281 2,814,618 41,258,748
Intangible assets 1,829,211 - - - 63 - 7,904 10,113 - 99,212 282,015 439,821 712,404 277,679
Deferred tax assets 6,399,267 - - - 6,399,267 - - - - - - - - -
Other assets 46,315,560 - - - 7,659,719 - 10,824,050 4,754,839 - 9,810,943 4,999,223 1,262,750 2,320,995 4,683,041
2,049,391,680 175,086,268 15,355,310 12,184,961 268,622,266 33,675,470 242,847,199 240,071,648 90,891,711 75,643,141 198,832,001 89,459,418 190,221,498 416,500,789
Liabilities
Bills payable 29,733,813 - - - 29,733,813 - - - - - - - - -
Borrowings 128,987,415 - 60,075,295 172,500 7,485,553 8,084,109 16,991,427 7,579,703 4,600 30,128 4,698,445 1,189,722 3,554,904 19,121,029
Deposits and other accounts 1,640,211,901 1,216,995,046 32,362,654 18,111,216 71,085,275 23,855,924 77,850,744 45,862,597 14,996,819 32,168,500 14,378,439 8,436,770 35,593,707 48,514,210
Subordinated debt 10,000,000 - - - - - - - - - - - - 10,000,000
Other liabilities 56,385,644 - - - 16,105,021 - 36,193,003 193,822 - 1,827,084 207,331 44,142 73,858 1,741,383
1,865,318,773 1,216,995,046 92,437,949 18,283,716 124,409,662 31,940,033 131,035,174 53,636,122 15,001,419 34,025,712 19,284,215 9,670,634 39,222,469 79,376,622
Net assets 184,072,907 (1,041,908,778) (77,082,639) (6,098,755) 144,212,604 1,735,437 111,812,025 186,435,526 75,890,292 41,617,429 179,547,786 79,788,784 150,999,029 337,124,167

Reserves 62,274,068
184,072,907
76
45.5.2 Maturities of assets and liabilities - based on expected maturities of the assets and liabilities of the Bank
Assets and Liabilities having contractual maturity dates are bucketed as per their respective maturities. The maturity profile of non-contractual deposits and bills payable is estimated
using an Exponentially Weighted Moving Average model based on historical data. The methodology and the assumptions used to derive the maturity profile of non-contractual liabilities
has been approved by Global Asset and Liabilities Committee (GALCO).
2021
Over 1 Over 3 Over 6
Upto 1 Over 1 year Over 2 years Over 3 years Over 5 years Over 10
Total month to 3 months to 6 months to 1
month to 2 years to 3 years to 5 years to 10 years years
months months year
--------------------------------------------------------------------------------------------- (Rupees in '000) ---------------------------------------------------------------------------------------------
Assets
Cash and balances with treasury banks 267,937,282 152,189,421 5,584,573 5,477,024 7,939,993 11,035,904 8,471,245 13,428,554 50,199,889 13,610,679
Balances with other banks 23,363,057 23,363,057 - - - - - - - -
Lendings to financial institutions 51,701,076 50,323,320 100,000 - 1,277,756 - - - - -
Investments 1,496,542,453 226,884,894 300,290,693 14,589,719 134,296,037 116,796,673 85,885,418 290,472,806 321,759,658 5,566,555
Advances 646,188,457 154,732,965 154,781,780 68,093,432 67,859,704 56,393,827 45,836,203 49,631,555 34,859,739 13,999,252
Fixed assets 68,537,653 61,545 47,703 79,995 1,653,193 1,558,334 1,572,925 3,721,294 4,994,602 54,848,062
Intangible assets 2,231,265 - 6,802 12,013 175,886 244,721 406,256 1,239,022 146,565 -
Deferred tax asset 7,204,275 - - - 1,801,069 1,801,069 1,801,069 1,801,068 - -
Other assets 54,460,389 11,194,966 12,250,364 4,867,433 8,188,172 3,557,207 2,081,536 4,576,720 4,032,276 3,711,715
2,618,165,907 618,750,168 473,061,915 93,119,616 223,191,810 191,387,735 146,054,652 364,871,019 415,992,729 91,736,263
Liabilities
Bills payable 26,792,970 7,809,077 5,715,962 5,602,096 7,665,835 - - - - -
Borrowings 563,284,750 1,325,694 - 3,605,036 12,434,710 514,546,620 764,419 3,153,240 18,250,521 9,204,510
Deposits and other accounts 1,750,943,765 167,448,127 141,920,695 115,125,298 109,601,921 92,506,861 141,420,469 130,904,410 228,207,296 623,808,688
Subordinated debt 10,000,000 - - - - - - - 10,000,000 -
Other liabilities 62,501,875 19,383,220 4,654,265 9,189,495 2,004,633 6,364,698 2,444,013 2,841,376 7,144,189 8,475,986
2,413,523,360 195,966,118 152,290,922 133,521,925 131,707,099 613,418,179 144,628,901 136,899,026 263,602,006 641,489,184
Net assets 204,642,547 422,784,050 320,770,993 (40,402,309) 91,484,711 (422,030,444) 1,425,751 227,971,993 152,390,723 (549,752,921)

Reserves 69,718,467
204,642,547
77
2020
Over 1 Over 3 Over 6
Upto 1 Over 1 year Over 2 years Over 3 years Over 5 years Over 10
Total month to 3 months to 6 months to 1
month to 2 years to 3 years to 5 years to 10 years years
months months year
--------------------------------------------------------------------------------------------- (Rupees in '000) ---------------------------------------------------------------------------------------------
Assets
Cash and balances with treasury banks 250,838,052 140,535,013 5,066,408 4,965,281 7,187,883 9,999,287 7,672,723 12,167,183 50,122,466 13,121,808
Balances with other banks 13,888,765 13,888,765 - - - - - - - -
Lendings to financial institutions 19,959,132 18,959,132 1,000,000 - - - - - - -
Investments 1,128,674,494 68,133,687 174,149,621 144,162,841 101,326,881 130,634,546 40,664,538 133,394,425 326,735,043 9,472,912
Advances 530,279,496 88,502,853 90,057,631 90,347,710 65,427,588 60,557,343 44,829,028 50,979,056 22,486,049 17,092,238
Fixed assets 51,207,703 308,690 483,463 796,145 923,884 2,358,874 2,263,281 2,814,618 4,749,641 36,509,107
Intangible assets 1,829,211 63 7,904 10,113 99,212 282,015 439,821 712,404 277,679 -
Deferred tax asset 6,399,267 - - - 1,599,817 1,599,817 1,599,817 1,599,816 - -
Other assets 46,315,560 7,659,719 10,824,050 4,754,839 9,810,943 4,999,223 1,262,750 2,320,995 4,374,863 308,178
2,049,391,680 337,987,922 281,589,077 245,036,929 186,376,208 210,431,105 98,731,958 203,988,497 408,745,741 76,504,243
Liabilities
Bills payable 29,733,813 10,629,807 7,780,787 7,625,482 3,697,737 - - - - -
Borrowings 128,987,415 67,733,348 25,075,536 7,579,703 34,728 4,698,445 1,189,722 3,554,904 19,121,029 -
Deposits and other accounts 1,640,211,901 200,528,223 154,834,343 97,929,834 122,539,344 119,233,575 88,894,946 163,181,971 506,328,203 186,741,462
Subordinated debt 10,000,000 - - - - - - - 10,000,000 -
Other liabilities 56,385,644 16,105,021 36,193,003 193,822 1,827,084 207,331 44,142 73,858 1,090,578 650,805
1,865,318,773 294,996,399 223,883,669 113,328,841 128,098,893 124,139,351 90,128,810 166,810,733 536,539,810 187,392,267
Net assets 184,072,907 42,991,523 57,705,408 131,708,088 58,277,315 86,291,754 8,603,148 37,177,764 (127,794,069) (110,888,024)

Reserves 62,274,068
184,072,907
78
45.6 Information Security Risk
Information security risk is the probability of exposure or loss resulting from a cyberattack or data breach on the Bank. It is
the potential for unauthorized use, disruption, modification or destruction of information such incidents can violate privacy,
disrupt business, damage assets and facilitate other crimes like frauds.
UBL has a dedicated Information Security Division, functioning within Risk and Credit Policy Group which manages
information security risks to protect the technology and information assets by preventing, detecting and responding to
threats, both internal and external.
Offensive security unit within the information security division manages Penetration Testing by simulating the real world
hacking scenarios. This unit remains responsible for establishing, implementing, maintaining and continually improving an
information / cyber security management system through control design and controls validation, primarily in the domain of
applications / network penetration testing, and also supporting the other domains of information security i.e., security
monitoring and threat hunting.
Moreover, to overcome social engineering frauds, extensive awareness campaigns are launched to provide specific
training and guidance on information security related matters such as phishing, identity theft, online transaction frauds, etc.
through various mechanisms such as social media, website, email advisories, SMS, webinars, phishing simulation
exercises, new joiner’s orientation, and targeted awareness sessions for executive leadership. These initiatives by
Governance, Risk and Compliance Unit are focused on elevating level of awareness for both internal as well as external
customers to better equip them to counter security challenges. This unit manages the security compliance efforts, risk
management and the development and implementation of information security policies, procedures, guidelines and
standards. Cyber & Infrastructure Security unit ensures that the IT Infrastructure function and services are resilient, secure,
well-designed, accessible, and adaptable to the organization's changing demands. This unit is responsible for the
continuous improvement of information / cyber security architecture that protects against both internal and external threats.
Significant progress has been made in securing the international territories as well by deploying 24/7 Security Operation
Center (SOC) at UBL. This unit deals with security issues. The unit continuously shares awareness news, alerts,
announcements, advisories and threats intelligence research reports to relevant stakeholder for securing the bank’s assets.
Application Security in IS manages IS Risk Analysis on software applications, APIs, Mobile Apps, Digital Channels, Cloud
Computing, ATM including review of security aspects of assets, enterprise architecture design controls of the Applications
in accordance with applicable policies, standards & controls.
Further, The Payment Card Industry Data Security Standard (PCI-DSS) program was initiated which aims to enhance
security for customer card data by setting guidelines for any company that accepts, stores, processes, or transmits card
information. This compliance framework is an industry-mandated set of standards intended to keep customer card data
safe when it is used by merchants and service providers.
Moving ahead, Bank’s main focus remains on the continuous improvement of UBL’s security posture and to effectively
prevent, monitor and rapidly respond to emerging threats and vulnerabilities.
45.7 Financial Crime Compliance (FCC) risk management and Pakistan FATF & APG action plan
The Bank monitor key risks on an ongoing basis to strengthen risk management in an effort to meet challenges emanating
from a volatile market environment and the complexity driven by the changing Regulatory frameworks. By utilizing
comprehensive risk management processes and sophisticated control systems, the Bank aims to minimize the negative
impact that may arise from varied degrees of risk exposures.
In response to changing landscape around FCC risks across the globe and in response to Financial Action Task Force
(FATF) & Asia Pacific Group (APG) action plan and State Bank of Pakistan's AML / CFT / CPF Regulations, the Bank
embarked upon a comprehensive Financial Crime Compliance Transformation Program under the guidance of Board of
Directors (BOD), specifically geared towards uplifting FCC Framework and fortifying controls across Process, People and
Technology (Regtech) work streams in line with international best practices and Standards. Targeted investments were
done across these work streams, brief highlights are as under:
79
- Under FCC Process Workstream; the Bank uplifted the framework at Design level with key deliverables as:
• FCC Strategy
• Bank’s FCC Risk Appetite Statement
• Target Operating Model (TOM) across three lines of defense
• FCC Policies & Standards
• Enterprise Wide FCC Risk Assessment Methodologies/Internal Risk Assessment Review (EWRA/IRAR) with focus on
AML, CFT, Sanctions / CPF & Transnational Risks etc.
• Management Information (MI) Suite.
- The Bank rolled out comprehensive Role based FCC training modules and Staff capacity assessment carried out under
FCC Transformation People Workstream.
- On Regtech work stream, the Bank upgraded and implemented best in class Transaction Monitoring (TM) and
payments screening systems. These systems were independently reviewed by a reputed international third party
- Effective risk governance sets a solid foundation for comprehensive risk management discipline. The Bank’s risk
governance framework is based on “three line of defense” governance model, wherein each line has a specific role with
defined responsibilities and work in close collaboration to identify, assess and mitigate risks. Key management and
board committee covering FCC and compliance matters is Compliance Committee of Management (CCM) and Board
Risk & Compliance Committee (BRCC).
Moreover, FCC Transformation & Controls Fortification Programme is an ongoing initiative that is managed by Compliance
Governance team in consultation with FCC teams across first and second line of defence.
45.8 Derivative Risk
There are a number of risks undertaken by the Bank, which need to be monitored and assessed.
Credit risk
Credit risk refers to the risk of non-performance or default by a party to a derivatives transaction, resulting in an adverse
impact on the Bank’s profitability. Credit risk associated with derivatives transactions is categorized into settlement risk and
pre-settlement risk. Credit proposals for derivatives transactions are approved by the Credit Committee. The credit
exposure of each counterparty is estimated and monitored against approved counterparty limits by Treasury Middle Office
(TMO) on a daily basis.
Market risk
The Bank, as a policy, hedges back-to-back all options transactions. In addition, the Bank does not carry any exchange risk
on its Cross Currency Swaps portfolio as it hedges the exposure in the interbank market. To manage the interest rate risk
of Interest Rate Derivatives, the Bank has implemented various limits which are monitored and reported by TMO on a daily
basis.
Liquidity risk
Derivatives transactions, usually being non-funded in nature, do not carry a specific funding liquidity risk.
The liquidity risk arises from the fact that in Pakistan, interest rate derivatives generally have a uni-directional demand, and
no perfect hedge is available. The Bank mitigates its risk by limiting the portfolio in terms of tenor, notional and sensitivity
limits, and can also hedge its risk by taking on and off balance sheet positions in the interbank market, where available.
Operational risk
The staff involved in the trading, settlement and risk management of derivatives is carefully trained to deal with the
complexities involved in the process. Adequate systems and controls are in place to carry out derivatives transactions
smoothly. Each transaction is processed in accordance with the product program or a transaction memo, which contains
detailed guidance on the accounting and operational aspects of the transaction to further mitigate operational risk. In
addition, TMO and the Compliance and Control Department are assigned the responsibility of monitoring any deviation
from policies and procedures. The Bank’s Audit and Inspection Group also reviews this function, with a regular review of
systems, transactional processes, accounting practices and end-user roles and responsibilities.
80
The Bank uses FX and Derivatives module of Treasury System which provides an end-to-end valuation solution, supports
the routine transactional process and provides analytical tools to measure various risk exposures, carry out stress tests and
sensitivity analysis.
TMO produces various reports on a periodic basis which are reviewed by senior management. These reports provide details
of the derivatives business profile such as outstanding positions, profitability, risk exposures and the status of compliance
with limits.
46. YEMEN OPERATIONS
The political and economic instability resulting from the ongoing civil war in Yemen raised insurmountable challenges for the
UBL-Yemen Branch including difficulties emanating from the bankruptcy of the two central banks regulators, i.e. CBY Sana’a
and CBY Aden, severe shortage of liquid funds in the Yemeni local market and non-cooperation of CBY Sana’a to facilitate
liquidity.
While UBL-Yemen Branch has been striving to honour its liabilities for the past seven years notwithstanding continued
operational losses, it is no longer possible for the branch to continue its operations in Yemen due to reasons not attributable
to the branch and circumstances entirely beyond UBL or its branch’s control. UBL is cognizant of the associated risks of
ceasing its branch’s business in Yemen but has concluded that in the totality of circumstances it is prudent to do so. UBL will
monitor the situation in Yemen so that it may appropriately deal with the associated risks.
47. NON-ADJUSTING EVENT AFTER THE BALANCE SHEET DATE
The Board of Directors, in its meeting held on February 23, 2022 has proposed a final cash dividend of Rs. 6.0 per share for
the year 2021. This is in addition to Rs. 12.0 already paid during the year bringing the total dividend for the year to Rs. 18.0
per share (2020: Rs. 12.0 per share). This appropriation is expected to be approved by the shareholders in forthcoming
Annual General Meeting. The unconsolidated financial statements for the year ended December 31, 2021 do not include the
effect of this appropriation which will be accounted for in the unconsolidated financial statements for the year ending
December 31, 2022.
48. GENERAL
48.1 Comparative information has been reclassified, rearranged or additionally incorporated in these unconsolidated financial
statements for the purposes of better presentation.
48.2 Figures have been rounded off to the nearest thousand rupees unless otherwise stated.
49. DATE OF AUTHORISATION
These unconsolidated financial statements were authorised for issue on February 23, 2022, by the Board of Directors of the
Bank.
81
Annexure 'I' as referred to in note 9.6 of the Bank's Unconsolidated and Consolidated Financial Statements
Statement showing written-off advances or any other financial relief of Five Hundred Thousand Rupees or above provided during the year ended December 31, 2021
Rs. in thousands
At the beginning Written-off
Sr. Name of individuals / partners / Interest / Interest /

Name and Address of the borrower CNIC Number Father / Husband Name Principal Others Total Principal Others Total
No. proprietors / directors Mark-up Mark-up
1 M/S Nawab Trading Co (Propritor:-
Asghar Khan) Asghar Khan 17301-6814472-9 Nawab Khan 425 7,875 - 8,300 - 7,890 - 7,890
House No 5559 Shah Qabool Colony
2 Aimal Khan
Mohallah Bar Shamozai, utmanzai Aimal Khan 17101-5943136-7 Tehseen Ullah 177 1,145 - 1,322 - 1,145 - 1,145
Tehsil & Distt Charsadda
3 M Ashraf Memon
Banglow # C-38 First Floor Block H
M Ashraf Memon 45504-1131899-1 M Dawood Begum 568 - - 568 396 229 - 625
North Naziabad Near Khursheed
Begum Garden
4 Sheraz Nasim Butt
Sheraz Nasim Butt 42301-2592514-5 M Nasim Butt 654 - - 654 439 134 - 573
64-T Commercial 2Nd Floor DHA
5 Mirza M Ammad
Abtach Off # 1 Plot # D-18 The
Mirza M Ammad 42301-2008357-7 Mirza Abdul 355 - - 355 485 33 - 518
Residence Khaliq Uz Zaman Road
Clifton ,Blk 8
6 Muhammad Asad
City Steel Industries 4 Rajput Street Muhammad Asad 35202-2352972-7 Muhammad Arshad 537 - - 537 496 51 - 547
Badami Bagh
7 Muhammad Naim
Avari Towers Asia Live Resturant
Muhammad Naim 91108-4191848-7 Muhammad Yousuf 590 - - 590 449 168 - 617
Avari Towers Fatima Jinnah Roads
Near Ubl Avari Br ,
8 Shabnam Mumtaz
Gerrys Internation Pvt Ltd Qvc Ground
Flr 37 B Pechs Blk 6 Main Shahra E Shabnam Mumtaz 31202-1724864-8 Mumtaz 681 - - 681 472 174 - 646
Faisal Near Roche Head,Office
Building
9 Danish Naeem Abbasi
Ptv Corporation Ltd Stadium Road Danish Naeem Abbasi 42101-1737279-5 Naeem Ul Hassan Abbasi 648 - - 648 432 190 - 622
Near Aga Khan Hospital,
10 M Nawaz Sohail
Arfa International Pvt Ltd Kamaham
M Nawaz Sohail 35201-0139460-7 Zahor Ahmad 200 - - 200 785 109 - 894
Attari Road Azam Chowk 16-Km
Ferozpur Road,
11 Shaheen Corporation Grain Market
Shaheen Corporation 36302-0744176-9 Mian Zubaid Ahmed Bhatti 350 1,502 - 1,852 - 1,482 - 1,482
Hasilpur
12
Paramount Spinning Mills Limited 2nd
Tanveer Ahmed Shakoor 42201-0350138-5 Abdul Shakoor
Floor, Finlay House, I.I. Chundrigar 300,000 36,768 - 336,768 122,912 36,768 - 159,680
Abdul Shakoor 42201-0350226-5 Haji Jamaluddin
Road, Karachi.
1
Rs. in thousands

13
Sarfraz Yoqub Textile Mills (Pvt) Ltd M. Naveed
35202-5480286-9 Yaqub Alam
1-KM Chunian Road, Habibabad Distt M. Ayub 107,764 36,205 15,189 159,158 - 36,205 14,489 50,694
35202-8426248-7 Yaqub Alam
Kasur Yaqub Alam [Late]
14 Firzouq Tanneries (Pvt) Ltd. Mr. Firzouq Elahi 34101-6919741-9 s/o Zahoor Elahi
Sialkot Road, Karamabad, Tehsil Mrs. Naila Firzouq 34101-3030182-0 w/o Firzouq Elahi 62,792 - 28,893 91,685 17,292 - 28,893 46,185
Wazirabad, District Gujranwala. Mr. Omer Firzouq 34101-2043436-5 s/o Firzouq Elahi
15
Muhammad Rafi [Late] Haji Muhammad Ismail
35202-3244650-5
Tariq Rafi M. Rafi
42301-0838522-7
Arif Rafi M. Rafi
Ayesha Textile Mills Ltd 97-B, Gulberg- 35202-1504108-3
Anjum Rafi M. Rafi 90,418 29,959 - 120,377 15,418 29,959 - 45,377
II, Lahore 35202-2434949-9
Abdullah Rafi M. Rafi
35200-1416576-7
Waseem Lodhi A.G.K Lodhi
35202-3765181-5
Nasir Anwar Muhammad Anwar
42201-7621019-3
16 Late, Sh.Abdul Hakeem
(CE/Director)
Late, Sh.Abdul Hameed
M/s Quality Weaving Mills Ltd 36-A Late, Mrs.Hakim-un-Nisa
54400-3769995-2 D/o Sh.Abdul Hakeem 14,008 14,673 110 28,791 4,008 14,673 110 18,791
Industrial Estate,Multan Late, Mrs.Bilquees Hakeem
Late, Mrs.Nasira Hameed
Miss Najma Hakeem
Late, Miss Tahira Hakeem
17 35200-1561125-1
Faisal Mukhtar [CEO/ Director] Ch. Ahmed Mukhtar
Dar-Es-Salam Textile Mills Limited 35200-1492705-4
Abida Mkhtar (Director) Ch. Ahmed Mukhtar
Head Office: 53-C3, Gulberg III, 35202-2732679-9
Ejaz Akhtar (Director) Muhammad Akhtar Khan
Lahore. 35201-1523109-0
Mehwash Faisal (Director) Faisal Mukhtar 162,169 21,540 - 183,709 - 16,150 - 16,150
Mill Address: 10 KM Sheikhupura 61101-1836202-0
Nilofar Mukhtar (Director) Ch. Ahmed Mukhtar
Road, 35202-2825811-5
Muhammad Rafique (Director) Siraj Ud Din Khan
Muridke. 61101-1836202-0
Muhammad Yousaf (Director) Khan Muhammad
18 Crown Travels
Office # 01, 1st Floor Services Club Mohammad Imaduddin
Ghouse Akbar 42301-4334931-9 43,500 25,189 - 68,689 - 14,939 - 14,939
Extension Building Mereweather Road Akbar (Late)
Karachi
19 Imran Haider (Partner) 35202-3886648-7
Ali Imran Rice Mills Jamil Ahmad
Irfan Jameel (Partner) 35202-2812119-7
1.5 KM Raiwind Road, Manga Mandi, Ali Muhammad 35,000 - 14,103 49,103 - - 13,103 13,103
Ghullam Mustafa (Partner) 35202-6264985-9
Lahore.
Khadim Hussain (Partner) 35202-7916823-5
2
Rs. in thousands

20
Sultan Trading Co. P-140-, 1st. Floor,
Regency Arcade, The Mall, Faisalabad
Saleem-ul-Hassan 33100-6033276-9
& Ghulam Hussain
Muzammil Sultan 33100-3058364-3 75,000 - 13,005 88,005 - - 13,005 13,005
P-130, MONTGOMARY BAZAR GOLE Saleem-ul-Hassan
Khurram Sultan 33100-5823060-7
LAKARWALA FAISALABAD
21 35202-6882153-7
Falak Textile (Pvt.) Ltd. 23-KM Rohi
Falak Sher (CEO / Director)
Nala, Dullu Khurd, 35202-5930326-9 Muhammad Sadiq 114,380 11,878 - 126,258 - 11,878 - 11,878
Wajid Sadiq (Director)
Ferozpur Road, Lahore.
Rafaqat Ali (Director)
35201-0429095-5
22 Habib & Co. Shop # 18, New Cloth 42301-5913275-5 Haji Habib
Haji Yaqoob Gang 7,881 - 9,736 17,617 - - 9,736 9,736
Market, M.A. Jinnah Road, Karachi.
23 Hassan Zahid 33100-7734991-5 Sh. Zahid Ahmed
Aftab Soap Factory (Pvt) Ltd. 9-KM
Asad Zahid 33100-6562801-7 Sh. Zahid Ahmed 57,140 - 8,466 65,606 - - 8,462 8,462
Sargodha Road, Faisalabad
Salman Zahid 33100-9424553-1 Sh. Zahid Ahmed
24 Kashif Ashfaq 33100-0927129-3 Muhammad Ashfaq
ChenOne Stores Ltd 92-93 E1 Gulberg
Abdulah Naeem 33100-5216561-5 Muhammad Naeem 211,251 18,275 - 229,526 - 5,901 - 5,901
Lahore
Umair Javed 33303-3773385-7 Muhammad Javed
25 CH. NAZAR MUHAMMAD MUNAWAR
Shop No.109, Fruit Mandi Link Ravi Munawar Hussain 35202-6387292-7 Nazar Muhammad 10,000 - 6,280 16,280 - - 5,486 5,486
Road, Lahore
26 Azeem International 4-F, 3/5,
Muhammad Mateen 42101-3210726-1 Muhammad Naeem 10,082 - 7,366 17,448 - - 5,448 5,448
Nazimabad, No.4, Karachi
27 Syed Qutubuddin & Brothers
29/BC Bukhari House Chaman Syed Qutubuddin 54400-0563870-1 Haji Bukhari 4,785 - 2,434 7,219 2,935 - 2,434 5,369
Housing Scheme Quetta.
28 J. P. Cement and Grinding Inds.
Syed Amaruddin 1) 54400-9616573-3 2) 1) Syed Qutubuddin 2) Faiz
12 Plot No.54/B, Q.I.T.E. Eastern By 4,294 - 2,291 6,585 2,544 - 2,291 4,835
Pervaiz Faiz 54400-378562-1 Muhammad
Pass Quetta.
29 Bashir Poultries
82-B Tipu Block, New Garden Town, Shahid Bashir 35202-2702691-7 Bashir Ahmed 15,106 4,572 - 19,678 - 4,278 - 4,278
Lahore
30 National Enterprises Oil Mills Chack
Rizwan Akbar 36603-1380361-3 Sardar Muhammad 4,086 226 3,649 7,961 217 226 3,649 4,092
No.93/WB Multan Road Vehari
31 Tar Enterprises
Mian Tahir Rafique 35202-6791875-7 Mian Muhammad Rafique 3,000 740 2,583 6,323 - 240 2,583 2,823
413, Block-P, DHA Lahore
32
New Sitara Rice Dealers
Muhammad Baqar Ch. 34101-9635059-9 Ch. Shah Din 3,600 - 3,092 6,692 - - 2,417 2,417
Pasrur Road, Farid Town, Gujranwala.
3
Rs. in thousands

33
Mushtaq Ali (Ex-Staff) House # 236-A,
Mushtaq Ali 42301-0353518-1 Imam Bux Mangnejo 3,823 544 2,164 6,531 - - 1,931 1,931
Sheet #1, Upper Gizri, Clifton Karachi
34 Mr. Muhammad Asalm

Ali Aslam Malik 42301-1091489-1 Malik
First National Equities Limited
Malik Atiq ur Rehman 35202-5802426-1 Mr. Malik Muhammad Hanif
10th Floor, Room # 7, New Karachi 7,208 - 1,858 9,066 - - 1,858 1,858
Muhammad Iqbal Khan 35202-2830885-1 Mr. Ghulam Mohiuddin
Stock Exchange Building, Karachi.
Shahzad Akbar 42000-4756995-3 Khan
Mr. Sajjad Akbar
35 M/s Noman & Company Grain Market Mr. Muhammad Khalid 31202-6791783-7 Mufti Ghulam Fareed
4,980 185 1,892 7,057 - 185 1,587 1,772
Bahawalpur Mr. Nisar Ahmad 31202-3742877-3 Abdul Ghafoor Khan
36 Shahbaz Flour Mills
Opposite Rangers Public High School Muhammad Nadeem Kaim Khani 44202-3161219-3 Hakim Ali Khan 5,829 - 1,892 7,721 - - 1,715 1,715
Gymkhana Road Khipro
37 31202-0668088-3
M/s Hassan Muhammad Cotton Mr. Mumtaz-ul-Zaman S/o Zahoor Ahmad
344-91-075151
Industries & Oil Mills Yazman Road Mst. Khursheed Begum Widdow of Zahoor Ahmad 2,500 - 1,619 4,119 - - 1,619 1,619
Bahawalpur Mst. Nasreen Ara W/o Mumtaz-ul-Zaman
31202-4952854-0
38 M/s Ch.Petroleum Service & Co
Muhammad Sarwar 35103-1324507-9 Bashir Ahmad 3,855 53 1,537 5,445 - 8 1,537 1,545
City Stop Lahore-Multan Road Pattoki
39 Abdul Razaq & Co.
Mubashir Rice Mills, Lahore Road, Abdul Razaq Sial 35401-5374166-5 Fazal Karim Sial 6,000 - 2,043 8,043 - - 1,493 1,493
Sheikhupura.
40 Pak Fertilizers Agency
Nand Lal 53403-1444758-7 Gurdayal Mal 2,000 386 1,079 3,465 - 386 1,079 1,465
Main Road, Sohbatpur
41 Bahawal Sheer (Agri) Chak Asad Ullah
Pur, Mouza Muhammad Pur Tehsil & Bahawal Sheer 36502-1294667-3 Muhammad 1,600 1,063 476 3,139 - 1,063 376 1,439
District Sahiwal
42 Choudhary Cold Storage Ch. Mehr
Ikram Cold Storage, 100 - Foota
Ch. Muhammad Ikram Mehar 34101-9703912-7 Ch. Muhmmad Nazir Mehar 3,000 - 1,517 4,517 - - 1,427 1,427
Bazar, New Sabzi / Fruit Mandi
Gujranwala.
43 Muhammad Mushtaq Toor (Agri) Chak
No.428 G.B, Tehsil Tandlianwala, Muhammad Mushtaq Toor 33106-0367404-5 Fazil Muhammad 2,990 - 1,436 4,426 - - 1,426 1,426
Faisalabad
44 AH POULTRY 130-Block G, DHA EME
Atta Ul Ahsan Awan 35202-0192307-9 Jafar Hussain Awan 9,250 68 1,620 10,938 - - 1,338 1,338
Sector, Lahore.
45
Asad Filling Station Inqilab Chowk,
Anwer Khan (Late) 17301-9077798-7 Badsha Khan 930 - 1,355 2,285 - - 1,285 1,285
Baghwanan Road, Phandu, Peshawar.
46 M. Humayun Khan 601-90-281339 Saudullah Khan

Zhob Impex (Pvt.) Limited House # 67- M. Ayaz Khan 517-85-265096 Shaikh Amir Mohammad
896 - 1,238 2,134 - - 1,133 1,133
E, Block-2, PECSH, Karachi Daud Khan 601-58-281338 Saudullah Khan
Shahbaz Khan 517-87-265097 Shaikh Amir Mohammad
4
Rs. in thousands

47 Zahid Hussain (Agri) Chak Dhakhli
Mahal, Mouza Ladhewal Tehsil Zahid Hussain 35301-3464138-1 Mian Muhammad Hussain 1,800 1,206 - 3,006 - 1,106 - 1,106
Depalpur District Okara
48 Abid Hussain (Agri) Chak Dhakhli
Mahal, Mouza Ladhewal Tehsil Abid Hussain 35301-5904407-1 Mian Muhammad Hussain 2,000 1,122 - 3,122 - 1,022 - 1,022
Depalpur District Okara
49 Mr.Nazeer Ahmad 35301-1984230-3
M/s Abdul Rasheed and Brothers Mr.Abdul Rasheed 35301-1984235-1
Muhammad Yaseen 15,000 - 1,230 16,230 - - 980 980
Pilpi Pahar Road, Tehsil Depalpur. Mr.Muhammad Ameer 35301-1984239-5
Mr. Basheer Ahmad 35301-5645749-9
50 Mr.Nazeer Ahmad 35301-1984230-3
M/s Ittefaq Rice Mills
Mr.Abdul Rasheed 35301-1984235-1
Chorasta, Chack No.38/D, Tehsil Muhammad Yaseen 15,852 - 1,308 17,160 - - 960 960
Mr.Muhammad Ameer 35301-1984239-5
Depalpur
Mr. Basheer Ahmad 35301-5645749-9
51 Khayyam Traders 236 SD, PAF
Khayyam Manzoor [Late] 35202-3520362-7 Manzoor Hussain 8,000 1,249 - 9,249 - 949 - 949
Falcon, Gulberg-III Lahore.
52 Nadeem Trading
Opposite Rangers Public High School Muhammad Nadeem Kaim Khani 44202-3161219-3 Hakim Ali Khan 2,949 - 1,021 3,970 - - 876 876
Gymkhana Road Khipro
53 Mangla Enterprises 44-Quaid-e-Azam Sabir Hussain 81302-7972281-3 Malik Fazal Hussain
1,456 404 634 2,494 - 210 634 844
Stadium, Mirpur Azad Kashmir Imran Khan 81302-1680271-7 Zafar Ali Khan
54 Fazal E Rabbi Commission Shop Noor Haji Sardar Muhammad 35402-9044175-9 Muhammad Tufail
1,900 - 899 2,799 - - 799 799
Ghalah Mandi, Bucheke Muhamm Yousaf 35402-2004071-7 Muhammad Tufail
55
Waqas Umar & Co. 605, 6thFloor, Gul
Waqas Umar 42301-7167553-5 Jawed Umar 11,993 702 - 12,695 - 695 - 695
Tower, I. I. Chundrigar Road, Karachi.
56 M/s. Hassan Brothers

Hassan Mehdi 35200-1418502-9 Kifayat Hussain 5,037 658 - 5,695 - 658 - 658
16-Nisbat Road, Lahore
57 Pak International Traders
Javed Akhtar 17301-1293844-5 Ghareeb Mirza
125-Out side Katchery Gage, 29,998 1,090 - 31,088 - 638 - 638
Danish Pervaiz 17301-1308969-3 Mahmood Pervaiz
Peshawar City Peshawar
58 Muhammad Shakeel Abid
M/s Madni Silk Center, Shop No.4-5,
Muhammad Shakeel Abid 33100-3228062-9 Ch. Sher Ali 2,300 - 627 2,927 - - 627 627
Anarkali Bazar, Street No.5, Al Sadiq
Center Faisalabad
59 Prince Electronics
Al Karim Centre 18-Railway Road, Rahim Aziz Ud Din 34301-1701937-9 Aziz Ud Din 1,500 - 559 2,059 - - 556 556
Hafizabad
60 Muhammad Ramzan (AGRI Loan) P.O
Chak No.232 G.B, Chak No.40 GB, Muhammad Ramzan 33104-4665281-5 Muhammad Ibrahim 1,000 - 532 1,532 - - 532 532
Tehsil Jaranwala, District Faisalabad.
61 Rimsha Textile
Naseer Ahmed 35102-0573874-1 Nasir Khan - - 777 777 - - 527 527
Adda Lallyani, District Kasur
5
Rs. in thousands

62 Muhammad Sharif
Muhammad Sharif 41103-0234744-7 1,500 1,123 - 2,623 - 623 - 623
Bagh Muhalla Bus Staff Matli
63 Tufail Ahmad
Sohainy Ka Dera.Mateela.Disst Tufail Ahmad 38401-1310518-7 1,000 504 - 1,504 - 504 - 504
Sargodha
64 Atif Ur Rehman Khan United Bank
Limited Dept Colletion Head Office
Atif Ur Rehman Khan 42201-1145454-9 Ibad Ur Rehman Khan 428 - - 428 - 261 300 561
3Rd Floor Ubl Bldg I I Chund R
Karachi
65 Husnain Malik Husnain Papper Mart
Fish Market Asad Plaza Urdu Bazar Husnain Malik 35202-1726490-9 Amanat Ali 643 - - 643 - 208 314 522
Lahore
66 Mehwish Pervaiz 159/A
Mehmoodaabad 1 Near Maseoom Mehwish Pervaiz 42301-0869042-0 Mohad Perviz 307 - - 307 - 184 380 564
Clinic Karachi
67 Hidayat Ullah 407 Gizri Madrasa
Hidayat Ullah 31301-1228103-5 Malik Kamal 915 - - 915 - 504 152 656
Ghousia Madrasa Karachi
68 Sadia Raza H No 405 Block A Farhan
Paradise Block 19 Johar More Sadia Raza 45402-0857414-2 Abdulu Jabbar Khan 255 - - 255 - 297 255 552
Gulistan-E-Johar Good Broast
69 Ahmed Shah M/S Naeem Electronics
Shop L 50 Hash00 Centre Abdullah Ahmed Shah 42301-0855341-9 Haji Nawaz 923 - - 923 - 387 392 779
Haroon Road Saddar Karachi
70 Saleem Haider Khan Fl No B-62 8Th
Floor Block B Sunny Heights Main Saleem Haider Khan 42201-1745059-9 Ghulam Haider Khan 501 - - 501 - 228 338 566
Rashid Minhas Rd Gulistan
71 Sarfraz Ali Nai Abadi Jafery Pura
Sarfraz Ali 34603-3154811-1 Muhammad Akram 686 - - 686 - 228 415 643
Sialkot
72 Naveed Ahmed H No 141-C Block W
Scheme No 2 Gulshan E Iqbal Rahim Naveed Ahmed 31303-9167445-3 Ghulam Rasool 951 - - 951 - 444 500 944
Yar Khan
73 Irfan Ahmed Sagar H No A-49 Ghazi
Irfan Ahmed Sagar 42501-6368770-3 Ghulam Abass 697 - - 697 - 453 655 1,108
Daud Brohi Village Malir City Karachi
74 Farrukh Hassan Naveed
H.No. C-87 Blk-14 Gulistan-E-Johar Farrukh Hassan Naveed 54400-9031394-1 SAFDAR ALI SHAHID 12,850 - - 12,850 - 510 5 515
Near Mirza Cng Pump Khi
75 Sana Haris Call
Springs Off # 301 3Rd Flr Prgressive
Sana Haris 42101-8146694-0 - - - - - 710 3 713
Squareplot # 11-A Blk 6 Pechs
Shahrah E Faisal
76 Usman Khalid
H # 197-Block D-1, Model Town, Usman Khalid 35202-8048278-9 KHALID AZIZ - - - - - 7,891 227 8,118
Lahore
6
Rs. in thousands

77 Naeem Jewellers
Shop No 89 Main Bazar Mozang Waseem Ud Din 35202-3921481-5 MOEEN UD DIN 6,417 - - 6,417 - 10,657 174 10,831
Lahore
78 Umer Draz Hamza
Umar Advartiser Room No 6, 1St Floor
Umer Draz 35202-4350047-7 SHER MOHD 1,558 - - 1,558 - 1,002 154 1,156
Sheikh Sons Building 10 Royal Park
Lahore
79 Iftikhar Khan
Win International 10 Km Sheikhpur Iftikhar Khan 33100-9583577-7 ZULFIQAR KHAN 4,507 - - 4,507 - 11,706 146 11,852
Road Near Malik Pur Stop Faisalabad
80 Zulfiqar Ali Chohan
House No 820 W Block Defence MUHAMMAD RAFIQ
Zulfiqar Ali Chohan 35201-7865042-5 3,005 27 - 3,032 - 12,316 184 12,500
Housing Authority Lahore Cantt CHOHAN
Lahore
81 Muhammad Latif Tabasum
U And Books Distributors 45/A Kisan Muhammad Latif Tabasum 35303-2097805-7 MUHAMMAD SALEEM 2,152 26 - 2,178 - 5,051 184 5,235
Hall Mozang Road Lahore
82 Shahzad Ali Shah
H No B-258 Block 10 Gulshan-E-Iqbal Shahzad Ali Shah 42201-5261280-1 AMAN ULLAH SHAH 6,668 - - 6,668 - 2,604 79 2,683
Near Alladin Park
83 Ahmed Yousuf
Hno C1 Sana Avenue Fl-2A Block 12 Ahmed Yousuf 42201-5489220-5 HAJI YOUSUF 400 580 - 980 - 602 67 669
Gulistan-E-Johar Karachi
84 Asim Mehmood
Flat No 92 E Askari Iv Rashid Minhas Asim Mehmood 61101-3637475-9 MEHMOOD 506 659 - 1,165 - 688 77 765
Road Gulistan E Jauhar
85
Mohammad Azeem
Al Balal Book Centre 40 Main Market Mohammad Azeem 35202-2527530-9 JAVED AHMAD MALIK 56 446 - 502 31 452 48 531
40 Urdu Bazar Pakistan Printin Lahore
86 Syed Muhammad Razi

Travel Area Aviation 94 Al Burhan
Syed Muhammad Razi 42101-9701338-1 S M SAEED 480 916 - 1,396 - 991 105 1,096
Arcade Block E Haidery Comm Area
Karachi
87 Muhammad Nadeem Darul Kittab
Kittab Market Ghazni Street Urdu Muhammad Nadeem 35202-2406274-1 RAAST ALI 192 411 - 603 49 452 46 547
Bazar Lahore
88 Uzma Akhtar Khan
House #142/1, Street 7 Khayaban-E- Uzma Akhtar Khan 42301-0998195-4 FARAZ KHANJI 238 398 - 636 54 409 46 509
Bukhari Phase 6 Dha
89 Mujahid Hussain
Mujahid Garments Resham Gali Mujahid Hussain 43203-9536175-7 MEERAL SHAIKH 234 444 - 678 82 458 46 586
Larkana Larkana Larkana
7
Rs. in thousands

90 Shazia Bano
H No 185 Baba Line Goth Morea Khan Shazia Bano 42201-6804470-8 BANO 294 437 - 731 87 454 49 590
Road Karachi
91 Haji Faqeer
DHA Phase Ii ,Main Rawat Road
Haji 42501-6054662-7 FAQEER 143 409 - 552 87 427 49 563
Opposite Gate No. 2 Near Ubl Bank
Limited Islamabad.
92 Khalid Kamal Siddiqui
Shop No. 659-C, Allama Iqbal Road,
Khalid Kamal Siddiqui 42101-3315259-1 M.AHMED SIDDIQUI 316 540 - 856 91 591 58 740
Block-2 Pechs Karachi. Karachi
Karachi
93
Qadeer Butt
House No.1 Butt Market Near Railway Qadeer Butt 35401-1760303-5 BUTT 344 879 - 1,223 94 937 95 1,126
Phatik G T Road Imamia Colony
94 Sohail Kassam Ali Somani

Karachi Music Centre Sommerset Sohail Kassam Ali Somani 42201-1221013-5 QASIM ALI 340 746 - 1,086 96 821 85 1,002
Street Plot No 27/B Saddar Karachi
95 Muhammad Jamil Akhtar Rai Ameer
Sons
Muhammad Jamil Akhtar Rai 35202-5025616-3 RAI AMIR AHMED 262 604 - 866 102 635 71 808
13-Qaddafi Market Nishtar Road
Brandreth Lahore
96 Mohammad Shakir Qureshi
H No G/2109 Power House Road Mohammad Shakir Qureshi 42000-7751158-5 FAIZ UL HASAN 395 519 - 914 118 604 67 789
Khaiyabad Hyderabad
97 Syed Hasan Iftikhar Zaidi
SYED IFTIKHAR AHMED
119/2 Street 33 Khayaban-E-Muhafiz Syed Hasan Iftikhar Zaidi 42301-9751357-5 456 541 - 997 126 627 66 819
ZAIDI
Phase 6 Dha
98
Syed Arshad Ali Rizvi
39-Bunglo Khayaban-E-Bkhari Phase- Syed Arshad Ali Rizvi 42301-1091489-1 S AZIZ UR REHMAN 468 641 - 1,109 138 652 75 865
6 Near Masri Shah Mazar Dha Karachi
99 Ijaz Ahmed
4-Amina Khatoon Plaza, Najma Udeen
Ijaz Ahmed 34101-4558782-9 AHMED 364 542 - 906 141 578 63 782
Street, Nankawara, Opst Jamli Steel,
Karachi.
100 Rubina Muhammad Jawed
Mehran Estate Shop No 1 Nadeem MUHAMMAD JAWED
Rubina Muhammad Jawed 42301-1560320-8 485 844 - 1,329 145 865 91 1,101
Manzil Gk 3/8/20 Paria Street KHAN
Kharada, Karachi
101 Shaheyar Shahansha
Fareast Elec No 5 Al Kabir Hotel Shaheyar Shahansha 42201-0371635-5 SHAHANSHAH HUSSAIN 490 874 - 1,364 145 992 102 1,239
Sohrab Katrak Road Saddar Karachi
8
Rs. in thousands

102 Muhammad Jawed Khan
Mehran Estate Gk-3/8/20 Shop 1
Muhammad Jawed Khan 42301-1341955-3 NOOR MUHAMMAD 493 867 - 1,360 147 889 93 1,129
Nadeem Manzil Paria Street Kharadar
,Karachi
1,550,006 233,254 146,510 1,929,770 171,013 259,634 144,657 575,304
9
Annexure 'II' as referred to in notes 2 and 9.8 of the Bank's Unconsolidated and Consolidated Financial Statements
ISLAMIC BANKING BUSINESS
The Bank operates 145 (2020: 100) Islamic Banking branches and 197 (2020: 187) Islamic Banking windows.
Note 2021 2020

STATEMENT OF FINANCIAL POSITION --------- (Rupees in '000) ---------
ASSETS
Cash and balances with treasury banks 13,367,864 9,784,450
Balances with other banks 7,049,825 2,277,264
Due from financial institutions 1 - 19,959,132
Investments 2 87,124,858 62,729,601
Islamic financing and related assets - net 3 43,855,127 20,538,157
Fixed assets 1,289,983 984,416
Intangible assets 2,084 4,638
Due from Head Office 4 4,712,655 7,997,409
Other assets 1,201,231 716,619
Total Assets 158,603,627 124,991,686
LIABILITIES
Bills payable 1,672,972 2,487,519
Due to financial institutions 5,714,199 3,632,752
Deposits and other accounts 5 139,534,238 111,478,161
Other liabilities 1,671,905 672,532
148,593,314 118,270,964
NET ASSETS 10,010,313 6,720,722
REPRESENTED BY
Islamic Banking Fund 2,181,000 2,181,000
Reserves - -
Deficit on revaluation of assets (265,635) (86,052)
Unappropriated profit 7 8,094,948 4,625,774
10,010,313 6,720,722
CONTINGENCIES AND COMMITMENTS 8
PROFIT AND LOSS ACCOUNT
Profit / return earned 9 9,426,874 8,702,285

Profit / return expensed 10 (4,226,099) (4,582,413)
Net profit / return 5,200,775 4,119,872
Other income
Fee and commission income 307,249 162,670
Dividend income - -
Foreign exchange income 12,925 5,712
Income / (loss) from derivatives - -
Loss on securities - net (736) (5,797)
Other income 29,642 15,821
Total other income 349,080 178,406
Total Income 5,549,855 4,298,278
Other expenses
Operating expenses 1,932,265 1,723,247
Workers Welfare Fund 78,384 47,479
Other charges - -
Total other expenses 2,010,649 1,770,726
Profit before provisions 3,539,206 2,527,552

Provisions and write-offs - net 70,032 12,813
Taxation 1,414,045 948,196
Profit after taxation 2,055,129 1,566,543
1
1. Due from Financial Institutions

2021 2020
Total Total
Currency Currencies Currency Currencies
--------------------------------------------------------------- (Rupees in '000) ---------------------------------------------------------------
Musharakah / Mudarabhah - - - 10,500,000 - 10,500,000

Bai Muajjal
with other Financial Institutions - - - 3,026,018 - 3,026,018
with State Bank of Pakistan - - - 6,433,114 - 6,433,114
- - - 19,959,132 - 19,959,132
2. Investments by segments
Note 2021 2020

Carrying
Amortised for (Deficit) Amortised for (Deficit) Carrying Value
Value
----------------------------------------------------------------------------------------- (Rupees in '000) -----------------------------------------------------------------------------------------
- Ijarah Sukuks 53,998,971 - (265,636) 53,733,335 19,992,452 - (86,052) 19,906,400
- Islamic Naya Pakistan Certificates 924,941 - - 924,941 466,435 - - 466,435
- Bai Muajjal with Govt. of Pakistan 2.1 21,214,989 - - 21,214,989 29,569,648 - - 29,569,648
76,138,901 - (265,636) 75,873,265 50,028,535 - (86,052) 49,942,483
Non Government Debt Securities

- Listed 657,143 - - 657,143 450,000 - - 450,000
- Unlisted 10,594,450 - - 10,594,450 12,337,118 - - 12,337,118
11,251,593 - - 11,251,593 12,787,118 - - 12,787,118
Total Investments 87,390,494 - (265,636) 87,124,858 62,815,653 - (86,052) 62,729,601
Note 2021 2020

2.1 Bai Muajjal with Government of Pakistan ------------------------------------- (Rupees in '000) -------------------
Bai Muajjal Investment 21,611,000 33,031,000

Less: Deferred Income (396,011) (3,461,352)
Bai Muajjal Investment - net 21,214,989 29,569,648
3. Islamic financing and related assets
Ijarah 3.1 376,317 440,754

Murabaha 3.2 263,312 272,766
Musharakah 12,401,891 8,392,690
Diminishing Musharakah 20,091,403 6,754,380
Mera Pakistan Mera Ghar (MPMG) 832,542 -
Istisna 80,112 39,584
Islamic Export Refinance scheme - Musharakah 4,598,162 2,989,544
Advances against Istisna - IERS 542,915 456,623
Advances against Islamic assets
Advances against Ijarah 6,528 77,190
Advances for Diminishing Musharakah 1,941,910 410,595
Advances for Murabaha 100,346 33,427
Advances agaisnt Mera Pakistan Mera Ghar 1,343,196 459
Advances for Istisna 407,065 148,586
Advances against Ameen ITERF 463,846 -
Inventory related to Islamic financing
Istisna 136,399 296,918
Profit and other receivables against financings 470,979 336,219
Gross Islamic financing and related assets 44,056,923 20,649,735
Less: Provision against Islamic financings

- Specific (131,139) (90,927)
- General (70,657) (20,651)
(201,796) (111,578)
Islamic financing and related assets - net of provision 43,855,127 20,538,157
2
3.1 Ijarah
2021
Cost Accumulated Depreciation
Book Value as at
At
At January Additions / At January Charge for At December 31, December 31,
December
1, 2021 (deletions) 1, 2021 the year 2021 2021
31, 2021
------------------------------------------------------------------ (Rupees in '000) ------------------------------------------------------------------
Plant & Machinery 505,082 505,082 252,489 67,263 319,752 185,330
Vehicles 391,646 139,175 363,607 203,485 102,878 172,620 190,987

(167,214) (133,743)
Total 896,728 (28,039) 868,689 455,974 36,398 492,372 376,317
2020
Cost Accumulated Depreciation
Book Value as at
At
At January Additions / At January Charge for At December 31, December 31,
December
1, 2020 (deletions) 1, 2020 the year 2020 2020
31, 2020
------------------------------------------------------------------ (Rupees in '000) ------------------------------------------------------------------
Plant & Machinery 673,648 15,923 505,082 309,046 109,483 252,489 252,593
(184,489) (166,040)
Vehicles 408,490 20,273 391,646 118,094 106,711 203,485 188,161
(37,117) (21,320)
Total 1,082,138 (185,410) 896,728 427,140 28,834 455,974 440,754
Future Ijarah payments receivable
2021 2020
Later than Later than 1
Not later 1 year and Over Five Not later year and
Total Over Five years Total
than 1 year less than 5 years than 1 year less than 5
years years
--------------------------------------------------------------------------- (Rupees in '000) ---------------------------------------------------------------------------
Ijarah rental receivables 245,589 173,001 418,590 245,443 245,509 - 490,952
Note 2021 2020

3.2 Murabaha ------------------------------------- (Rupees in '000) -------------------
Murabaha financing 3.2.1 263,312 272,766

Advances for Murabaha 100,346 33,427
363,658 306,193
3.2.1 Murabaha receivable - gross 3.2.2 263,312 272,766

Less: Deferred Murabaha income 3.2.4 (3,522) (2,159)
Less: Profit receivable shown in other assets (3,554) (3,510)
Murabaha financings 256,236 267,097
3.2.2 The movement in Murabaha financing during the year is as follows:
Opening balance 272,766 421,509

Sales during the year 2,515,644 1,161,818
Adjusted during the year (2,525,098) (1,310,561)
3.2.3 Murabaha sale price 263,312 272,766

Murabaha purchase price (256,236) (267,097)
7,076 5,669
3
2021 2020
------------------------------------- (Rupees in '000) -------------------
3.2.4 Deferred Murabaha income
Arising during the year 63,508 33,269
Less: recognised during the year (62,145) (37,243)
4. Due from Head Office mainly represents inter branch transactions.
5. Deposits 2021 2020

Total Total
Currency currencies Currency currencies
------------------------------------- (Rupees in '000) -------------------------------------
Customers
Current deposits 73,429,642 1,411,043 74,840,685 39,475,999 884,081 40,360,080
Savings deposits 26,341,608 - 26,341,608 18,710,264 - 18,710,264
Term deposits 9,833,547 - 9,833,547 5,662,065 - 5,662,065
109,604,797 1,411,043 111,015,840 63,848,328 884,081 64,732,409
Financial Institutions
Current deposits 11,355,282 - 11,355,282 2,046,933 - 2,046,933
Savings deposits 4,113,116 - 4,113,116 22,697,263 - 22,697,263
Term deposits 13,050,000 - 13,050,000 22,001,556 - 22,001,556
28,518,398 - 28,518,398 46,745,752 - 46,745,752
138,123,195 1,411,043 139,534,238 110,594,080 884,081 111,478,161
2021 2020
5.1 Composition of deposits ------------------------------------- (Rupees in '000) -------------------
- Individuals 64,151,136 32,635,739

- Government / Public Sector Entities 9,405,202 2,216,437
- Banking Companies 20,031,270 9,033,791
- Non-Banking Financial Institutions 8,487,128 37,711,961
- Private Sector 37,459,502 29,880,233
139,534,238 111,478,161
5.1.1 This includes deposits eligible to be covered under insurance arrangements amounting to Rs. 87,997.015 million (2020:
Rs. 31,125.997 million).
2021 2020
6. Charity Fund ------------------------------------- (Rupees in '000) -------------------
Additions during the period

Received from customers on account of delayed payment 4,542 3,240
Profit on charity saving account 170 296
4,712 3,536
Payments / utilisation during the year
Education (1,000) (1,000)
Health (2,000) (2,700)
Others (500) (500)
(3,500) (4,200)
7. Islamic Banking Business Unappropriated Profit

Add: Islamic Banking profit for the year 3,469,174 2,514,739
8,094,948 4,625,774
Less: Taxation (1,414,045) (948,196)
Closing balance 6,680,903 3,677,578
4
2021 2020
8. Contingencies and commitments ------------------------------------- (Rupees in '000) -------------------
- Guarantees 400 111,454

- Commitments 14,347,212 5,880,112
14,347,612 5,991,566
9. Profit / Return earned on financing, investments and placement
Profit earned on:

Financing 2,530,715 1,860,616
Investments 6,365,278 5,394,613
Placements 308,916 1,174,739
Rental Income from Ijarah 221,965 272,317
9,426,874 8,702,285
10. Profit on Deposits and other dues expensed
Deposits and other accounts 4,039,663 4,430,595

Due to Financial Institutions 84,478 54,756
Return expense on leases 101,958 97,062
4,226,099 4,582,413
11. Disclosures for profit and loss distribution and pool management
The Bank operates general and special pools for deposits and inter-bank funds accepted / acquired under Mudarabah,
Wakalah and Musharakah modes.
Under the General deposits pools, the Bank accepts funds on Mudarabah basis from depositors (Rab-ul-Maal) where the
Bank acts as Manager (Mudarib) and invests the funds in the Shariah Compliant modes of financing, investments and
placements. When utilising investing funds, the Bank prioritizes the funds received from depositors over the funds
generated from own sources after meeting the regulatory requirement relating to such deposits.
Specific pools are operated for funds acquired / accepted from the Corporate Customers, other banks and State Bank of
Pakistan for liquidity management and Islamic Export Refinance to the Bank's customers respectively under the
Musharakah/ Mudarabah / Wakalah modes.
General Pools
For General Pools, the Bank allocates PKR financing to Corporate, SME and Consumer Finance customers in diversified
sectors and avenues of the economy / business and Investments in Sovereign Guarantee Sukuk, Corporate Sukuk, Bai
Muajjal with Government of Pakistan, are also done through General Pools. All remunerative deposits are tagged to these
general pools and their funds generated from the depositors are invested on priority basis.
IERS Pool(s)
The IERS pool assets comprise of Sovereign Guarantee Sukuk, and financing to Corporate Customers and exporters as
allowed under the applicable laws and regulations, and as such are exposed to lower credit risk. The Musharakah with
SBP under IERS is tagged to the IERS pool.
Treasury Pool(s)
The Treasury pool assets generally comprise of Sovereign Guarantee Sukuk and financing under diminishing musharakah,
Ijarah facility and the related liability of the Treasury pool comprise of Musharakah / Wakalah / Mudarabah from financial
institutions. These pools are created to meet the liquidity requirements of the Holding company.
Special Pool(s) - LCY

Separate pool(s) are created where the customers desire to invest in high yield assets. These pool(s) rates are higher than
the general pool depending on the assets. In case of loss in special pool, the loss will be borne by the special pool
members. The net return on the pool is arrived at after deduction of direct costs from the gross return earned on the pool.
From the net return, profit is paid to the Mudarib in the ratio of the Mudarib’s equity in the pool to the total pool. The
balance represents the distributable profit.
5
Special Pool(s) - FCY

UBL also manage Foreign Currency (FCY) special pools. The objective of Pool is to meet the FCY Liquidity requirement.
The funds in this pool are generally deployed in FCY Placment of funds with State Bank under the mode of Islamic Naya
Pakistan Certificate, loss (if any) is borne by the Rab-ul-Maal as per ratio of investment of the pool.
Equity Pool(s)
All other assets including fixed assets, advance against financing, bai-salam financing and subsidized financing to Bank's
employees are tagged to equity pool. To safeguard the interest of customers, all high risk investments are done through
equity pool. The Bank as Mudarib in the general pools is responsible for financing costs / assets such as land, building,
furniture, fixtures, computers and IT system from its own sources / equity.
During the year, the Bank has given General Hiba to the depositors in General and specific pool, keeping in view the
prescribed guidelines of Pool Management provided by the SBP. However, Hiba are given at the sole discretion of the
Bank without any contractual commitment with the depositors.
The Mudarib’s share on Deposits for the year ended December 31, 2021 is Rs. 2,946.424 million (45.00% of distributable
profit of Mudarabah Pool). Of this, an amount of Rs.480.272 million (16.30% of Mudarib share) was distributed back to
depositors as Hiba. The rate of profit earned on average earning assets was 9.23% per annum and the rate of profit paid
on average deposits was 5.75% per annum.
The risk characteristics of pools
The risk characteristic of each pool mainly depends on the assets and liability profile of the pool. As per the Bank 's policy,
relatively low risk / secured financing transactions and assets are allocated to the pool. The Bank maintains General Pools,
Special Pools, FI Pools, IERS pool and Equity pool. All pools are exposed to general credit risk, asset ownership risk and
Profit rate risk of underlying assets involved.
The Parameters used for allocation of profit, expenses and provisions to the Pool
- The profit of each deposit pool is calculated on all the remunerative assets booked by utilising the funds from the pool.
- Profit of pool is calculated after deduction of expenses directly incurred in earning the income of such pool, the directly
related costs comprise of depreciation on ijarah assets, takaful premium, amortisation of premium on investment etc.
- No expense of general or administrative nature is charged to the pools.
- No provisions against any non-performing asset of the pool is passed on to the pool except on the actual loss / write-off of
such non-performing asset.
- The profit of the pool is shared between equity and Rab-ul-Maal of the pool on the basis of Musharakah at gross level
(before charging of mudarib fee) as per the investment ratio of the equity.
- The profit of the pool is shared among the members of the pool on pre-defined mechanism based on the weightages
announced before the profit calculation period after charging of mudarib fee.
6
The Bank managed following pools during the year.
2021
Profit rate
Mudarib fee / Average Percentage of Amount of
and Average
No of Nature of Profit Musharkah profit rate / Mudarib share Mudarib share
weightages profit rate
Pools Pool Sharing ratio share / Wakala return transferred transferred
announce- earned
Fee distributed through Hiba through Hiba
ment period
% % Rupees in '000 % % Rupees in '000
ADMA Pools 12 Mudarabah Monthly 8.90% 48.14% 83,116 6.10% 34.48% 28,656
Special Pools 113 Mudarabah Monthly 8.60% 31.58% 556,339 6.98% 36.57% 203,435
IERS Pools 24 Musharakah Monthly 6.30% 0.00% 308,493 2.00% 0.00% -
FCY Pools 18 Mudarabah Monthly 2.00% 50.00% 2,147 1.06% 0.00% -
General Pools 12 Mudarabah Monthly 9.51% 50.00% 2,306,970 5.27% 10.76% 248,182
Treasury Pools 5 Musharakah Monthly 9.26% 0.00% 643,013 8.71% 0.00% -
2020
Profit rate
Mudarib fee / Average Percentage of Amount of
and Average
No of Nature of Profit Musharkah profit rate / Mudarib share Mudarib share
weightages profit rate
Pools Pool Sharing ratio share / Wakala return transferred transferred
announce- earned
Fee distributed through Hiba through Hiba
ment period
% % Rupees in '000 % % Rupees in '000
ADMA Pools 12 Mudarbaha Monthly 5.90% 50.00% 8,446 4.15% 7.74% 654
Special Pools 120 Mudarbaha Monthly 10.84% 36.96% 888,011 8.26% 36.14% 320,970
IERS Pools 24 Mudarbaha Monthly 5.48% 86.92% 358,319 2.00% 0.00% -
General Pools 12 Mudarbaha Monthly 10.83% 50.00% 2,035,467 8.66% 20.00% 407,004
Treasury Pools - - - - - - - - -
2021 2020
------------------------------------- (Rupees in '000) ------------------
11.1 Deployment of Mudarabah based deposits by class of business
Chemical and pharmaceuticals 3,815,014 2,230,052

Agri business 12,686,234 8,745,482
Textile 2,362,688 1,991,142
Financial 7,664,825 13,335,120
Food industries 152,269 318,037
Plastic 301,339 299,263
Individuals 13,303,854 1,981,422
Production and transmission of energy 18,441,835 13,496,129
Government of Pakistan Securities 75,873,265 59,401,615
Others 3,630,282 3,817,471
138,231,605 105,615,733
6
Annexure 'III' as referred to in Note 10.6 of the Bank's Unconsolidated Financial Statements
Disposals of fixed assets to related parties during the year 2021
Accumulated Book Sale

Cost Mode of disposal Particulars of Purchaser
depreciation value proceeds
------------------------------------ (Rupees in '000) ------------------------------------
Vehicles
Mercedes 11,877 10,689 1,187 2,375 Buy Back Aqeel Ahmed Nasir
Mercedes 11,867 10,680 1,187 2,373 Buy Back Imran Sarwar
Mercedes 11,867 10,681 1,187 2,374 Buy Back Aameer Karachiwalla
Mercedes 11,465 8,083 3,382 5,675 Buy Back Sadia Saeed
Mercedes 11,868 10,681 1,187 2,374 Buy Back Furrukh Zaeem
58,944 50,814 8,130 15,171
Electrical, office and computer equipment

Automated Teller Machine 1,669 1,043 626 1,182 Insurance UBL Insurers Limited
Total 60,613 51,857 8,756 16,353

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United Bank Limited

UNCONSOLIDATED FINANCIAL STATEMENTS

Net Markup Income

Directors’ Report FY 2021 Page |1

Directors’ Report FY 2021 Page |2

Provisions, loan losses and non-performing loans

Directors’ Report FY 2021 Page |3

Balance Sheet Management

Directors’ Report FY 2021 Page |4

Directors’ Report FY 2021 Page |5

Subsidiaries Performance Overview

Highlights of the financial performance of our subsidiaries in 2021 is as follows: -

Directors’ Report FY 2021 Page |8

Awards and Recognition

Directors’ Report FY 2021 Page |9

 Proper books of accounts of the Bank have been maintained.

Directors’ Report FY 2021 P a g e | 10

Board Audit Committee (BAC):

Board Risk and Compliance Committee (BRCC):

Mr. Arshad Ahmad Mir Chairman

Directors’ Report FY 2021 P a g e | 11

Board Human Resource & Compensation Committee (HRCC):

Mr. Tariq Rashid Chairman

Board IT Committee (BITC):

Mr. Tariq Rashid Chairman

Board Nomination Committee (BNC):

Sir Mohammed Anwar Pervez, OBE, HPk Chairman

Directors’ Report FY 2021 P a g e | 12

Directors appointment and nomination

Board Performance Evaluation

Directors’ Report FY 2021 P a g e | 14

Meetings of Board Committees

BAC BRCC HRCC BITC BNC

Meetings of the Board

Directors’ Report FY 2021 P a g e | 15

Name of the Director Designation Meetings attended

Sir Mohammed Anwar Pervez, OBE, HPk Chairman 5

Lord Zameer M. Choudrey, CBE, SI Pk Director 5

Mr. Haider Zameer Choudrey Director 5

Mr. Rizwan Pervez Director 5

Mr. Arshad Ahmad Mir Director 5

Mr. Amar Zafar Khan Director 5

Mr. Tariq Rashid Director 5

Ms. Shazia Syed Director 5

Mr. Shazad G. Dada President & CEO 5

The pattern of shareholding as at December 31, 2021 is given below:

Directors’ Report FY 2021 P a g e | 16

The aggregate shares held by the following are:

Directors’ Report FY 2021 P a g e | 17

Some of the key features of the remuneration structure are as follows: -

Directors’ Report FY 2021 P a g e | 18

Material Risk Takers (MRTs) and Material Risk Controllers (MRCs)

Remuneration of MRTs and MRCs

Variable remuneration is performance based, similar to the Bank’s other employees.

Risk Management Framework

Directors’ Report FY 2021 P a g e | 21

Sustainability at UBL in 2021

Directors’ Report FY 2021 P a g e | 22

Statement of Internal Controls