Faysal Bank Limited ("FABL" or the "Bank") was incorporated on October 3, 1994, as a public limited company under the provisions of the Companies Act, 2017 (previously, Companies Ordinance 1984).

FABL started operations in Pakistan in 1987, first as a branch set up of (Shamil Bank of Bahrain), and since 1994, as a locally incorporated Bank under the present name. In 2002, Al-Faysal Investment Bank, another group entity, merged into Faysal Bank Limited. The State Bank of Pakistan issued the Islamic Banking License No. BL(i)-01 (2022) on December 30, 2022. Consequently, the Bank transitioned into a full-fledged Islamic Bank and commenced operations on January 1, 2023. The registered office of the Bank is located at Faysal House, St-02, Shahrah-e-Faysal, Karachi, Pakistan.

The Bank is engaged in Shariah-compliant modern corporate, commercial, and Consumer banking activities. As of end-Dec25, the Bank operates with a network of 900 branches (end-Dec24: 855 branches). The Bank is engaged in consumer finances (secured and unsecured), car financing, and secured Islamic personal finances. The Bank provides financing primarily through Murabaha, Musawamah, Istisna, and other Islamic modes. It also offers wealth management solutions to its customers.

Faysal Bank Limited is a Pakistani Islamic Bank, 66.78% of which is owned (directly and indirectly) by Ithmaar Bank B.S.C. (Closed). Ithmaar Bank is a wholly owned subsidiary of Ithmaar Holding B.S.C., which serves as its parent company. The remaining 33.22% is held by the general public and the Bank’s directors. At the apex of the structure, the ultimate parent is Dar Al-Maal Al-Islami Trust (DMIT), the holding company of Ithmaar Holding.

The ownership structure of the Bank is considered strong as the major shares are held by Ithmaar Bank B.S.C. (Closed). The equity base of Ithmaar Bank B.S.C. (Closed) is BHD 110.6mln by CY25, up from BHD 106.2mln in CY24.

Ithmaar Holdings B.S.C. (Ithmaar Holdings) is a Bahrain-based holding company that is licensed and regulated as an investment company and is listed on the Bahrain Bourse, Boursa Kuwait and Dubai Financial Market.

Ithmaar Holdings B.S.C. and its subsidiaries are engaged in a wide range of financial services including retail, commercial, investment banking, private banking, takaful and real estate development.

The overall control of the Bank vests in the eleven-member Board of Directors (Board). Ithmaar Bank, the key shareholder, is represented by six non-executive directors on the Board, who are nominees of the Bank; four are independent directors, and one executive director is the CEO.

Mr. Mian Mohammad Younis, Chairman of FBL, is a seasoned economist and civil servant with over 40 years of experience in finance, governance, and public policy. Mr. Ahmed Abdulrahim Bucheery, Vice Chairman, is a veteran Bahraini banker and former CEO of Ithmaar Group with extensive international banking experience. Mr. Imtiaz Ahmad Pervez is a senior banking professional with over 35 years of international experience and a key figure in Faysal Bank’s early development. Mr. Ali Munir is a Chartered Accountant with extensive experience in banking reforms and senior roles at MCB, Citibank, and HBL. Mr. Juma Hasan Ali Abul is a finance executive with global board memberships and a background in accounting and Islamic finance. Mr. Abdulelah AlQasimi brings 45 years of diverse public and private sector leadership, especially in development and education. Ms. Fatima Asad Khan is a transformation leader and CEO of Abacus Consulting with expertise in digital strategy and governance. Mr. Mohsin Tariq is an entrepreneur and turnaround strategist behind Nimir Chemicals’ success, with a strong focus on financial oversight. Ms. Sadia Khan is a fintech leader and former CEO of AutoSoft Dynamics with a track record of core banking and digital banking innovations. Mr. Mohamed Ahmed Bucheerei is a senior banking professional with over 18 years of experience in Islamic banking, strategy, and investments, currently leading strategy and transformation at Ithmaar Bank and serving on multiple regional and international boards.

Board meetings are conducted at regular intervals. The Board exercises close monitoring of the management’s policies and the Bank’s operations through board committees. There are six board committees in place, namely: 1) Audit and Corporate Governance Committee, 2) Risk Management Committee, 3) Recruitment Nomination and Remuneration Committee, 4) Strategy Committee, 5) IT Committee, and 6) Sustainability and Development Committee. Additionally, nine directors out of the total ten directors are certified and have completed the mandatory Director's training programme.

The External Auditors of the Bank, KPMG Taseer Hadi & Co., Chartered Accountants, issued an unqualified audit opinion pertaining to annual financial statements for CY25. Furthermore, the Board has set up an effective internal audit function that reports independently to the Board Audit & Corporate Governance Committee regularly on compliance with critical policies and procedures and recommends amendments to these policies in line with the industry's best practices.

The Bank has a well-defined organizational structure. Operations are segregated into various departments wherein clear lines of responsibility are defined for each cadre.

Mr. Yousaf Hussain has been President & CEO of Faysal Bank since May 2017 and with the Bank since 2008. He brings over 30 years of banking experience, having held senior roles in risk, corporate banking, and special assets, with prior experience at ABN AMRO, Samba Bank, Mashreq Bank, and Mobilink/Motorola. He holds a BSc in Electrical Engineering and an MBA from LUMS. He is supported by a management team of well-experienced and qualified individuals. Mr. Shuja Haider is an experienced banking professional with over 20 years of expertise in treasury, risk, and capital markets, currently serving as Group Head of Treasury & ECM at Faysal Bank, with prior senior roles at leading local and international financial institutions. Mr. Raheel Ijaz has over 40 years of banking experience, having held senior roles at MCB Bank, United Bank, Faysal Bank, Prime Commercial Bank, and Emirates Bank International, including leadership positions in compliance, corporate, and regional management. He holds an MBA from Quaid-e-Azam International University. Mr. Tanveer Khatri is a seasoned finance professional and Fellow Chartered Accountant with over 20 years of experience. On December 11, 2025, his appointment as Chief Financial Officer of Faysal Bank Limited was officially confirmed. Prior to this, he had been serving as Acting Chief Financial Officer since September 19, 2025, following the retirement of Mr. Syed Majid Ali. Mr. Tanveer brings extensive expertise in financial strategy, governance, and compliance, and has held prior leadership roles at Faysal Bank Limited, United Bank Limited, Habib Bank Limited, and KPMG Pakistan. Mr. Salman Ali has over 22 years of banking experience in corporate, commercial/SME banking, and credit/risk management. He has held leadership roles in local and multinational banks, including ABN AMRO Pakistan and Allied Bank, and serves as a director at Faysal Asset Management Limited. He holds an MBA from Lahore School of Economics and is a certified Islamic Banking Professional from NIBAF.

A Management Committee (MANCOM), comprising group heads, meets on a quarterly basis to review the performance of each division vis-à-vis set targets. The MANCOM also provides strategic input for setting the direction of the Bank vis-à-vis the economic environment and decides on the implications of new business initiatives for the Bank.

The Bank has implemented a robust IT Governance framework aligned with regulatory requirements and guided by the IT Steering Committee, Board IT Committee, and regulatory bodies. This framework ensures alignment between IT strategy, business goals, and cybersecurity, promoting accountability and adherence to global best practices. By integrating advanced technologies, automation, and strong cybersecurity, the Bank enhances agility and innovation. These efforts support regulatory compliance and enable the delivery of cutting-edge financial solutions. Through continuous IT governance enhancement, Faysal Bank remains a leader in secure digital transformation.

The Bank is exposed to a wide range of internal and external risks, including credit, market, liquidity, operational, cybersecurity, and reputational risks, among others. With its transition to a full-fledged Islamic Bank, Shariah non-compliance has become a key operational concern. To address these challenges, the Bank has implemented a Board-approved Integrated Risk Management framework. Major risks are actively monitored by specialized management committees such as Country Credit Committee (CCC), Enterprise Risk Management Committee (ERMC), Assets and Liabilities Committee (ALCO), Investment Committee (IC), IT Steering Committee (ITSC) and Compliance & Fraud Risk Committee (C&FRC) within their respective areas. This approach ensures effective risk oversight and alignment with regulatory and strategic objectives. The internal Risk Rating Module is being used by the Bank. The module supports the Bank in its Obligor Risk Rating (ORR) process by adding more objectivity to the credit appraisal process. The Bank has assigned 50.6% of its obligors under "Good and above" credit risk rating , while another 44.1% fall under the "Marginal and above" category. Approximately 2.2% of obligors are rated under "Overdue but not Classified and above," and 3.1% are categorized under "Loss and above."

During CY25, Pakistan’s banking sector’s total assets grew by approximately 17.8% YoY, while investments surged by ~31.1% to PKR ~39.1trln (CY24: PKR ~29.8trln). Net advances of the sector declined by ~6% to PKR ~14.9trln (CY24: PKR ~15.8trln). Non-Performing Loans (NPLs) decreased by 9.7% YoY to PKR ~964bln (CY24: PKR ~1,068bln). The Capital Adequacy Ratio (CAR) averaged 20.8% (CY24: 20.6%), Slightly below historical averages due to higher risk-weighted assets and a shift toward low-yield government securities, yet capitalization remains adequate to absorb potential shocks. While the Advances to Deposit Ratio (ADR) was reported at 37.5% (CY24: 49.7%), which appears higher relative to declining advances because deposit growth outpaced lending activity. This reflects a cautious lending stance by banks in a challenging macroeconomic environment, where risk-averse behavior and liquidity accumulation resulted in slower credit deployment, pushing the ADR downwards. In a lower policy rate environment, coupled with high operating costs and reduced lending, the sector faced margin pressure, leading to moderated profitability by end-CY25, despite robust capitalization and improving asset quality. (Source: SBP Compendium). Amid this environment, FABL continued to expand its lending portfolio, reporting an ADR of 61.1%, significantly above the industry average. However, this expansion exerted pressure on the Bank’s CAR, which declined to 14.04% in CY25 (CY24: 16.54%).

FABL is a medium-sized bank demonstrating sustainable growth, with its total deposit base increasing by 36.7% to PKR 1,427.4bln in CY25 (CY24: PKR 1,044.3bln). The Bank’s customer deposits rose by 28.6% to PKR 1,081bln (CY24: PKR 840.4bln), while deposits from financial institutions increased by 69.8% to PKR 346.4bln (CY24: PKR 203.9bln). The Top 20 Deposit concentration to total deposits was 26% (CY24: 20%). Meanwhile, individual deposits accounted for 16.5% of total deposits (CY24: 21%), public sector deposits 3.0% (CY24: 2.1%), and government deposits 2.0%, unchanged from the previous year. Based on total deposits, the Bank’s market share increased to 3.8% (CY24: 3.5%).

In CY25, Faysal Bank Limited earned total profit/return of PKR 165.9bln, down 26% from PKR 225.1bln in CY24. Profit/return on financing declined by 19% to PKR 83.1bln (CY24: PKR 102.5bln), while returns on investments fell by 32.2% to PKR 82.7bln (CY24: PKR 122bln). The overall decline in returns was primarily driven by reduced yields on financing and investments in the low interest rate environment of CY25. As a result, the net interest margin (NIM) was declined by 13.4% to PKR 69.6bln (CY24: PKR 80.4bln). While, the Bank’s asset yield declined to 11.9% (CY24: 18.3%), and the spread narrowed to 5.2% (CY24: 6.8%).

During CY25, Non-funded income remained a key contributor to revenue, reaching PKR 29.4bln (CY24: PKR 17.4bln). The Bank’s fee and commission income increased by 22.7% to PKR 12.9bln (CY24: PKR 10.5bln), primarily comprising card-related fees of PKR 6.4bln (CY24: PKR 4.5bln), commission on trade of PKR 1.4bln (CY24: PKR 1.1bln), and commission on remittances including home remittances of PKR 1bln (CY24: PKR 1.6bln). Foreign exchange income rose by 46.7% to PKR 7.8bln (CY24: PKR 5.3bln), and gains on securities increased sharply to PKR 8.2bln (CY24: PKR 1.1bln). Dividend income grew by 27.2% to PKR 525.1mln (CY24: PKR 412.9mln), while income from derivatives remained minimal. Net loss on derecognition of financial assets measured at amortised cost rose to PKR 330.5mln (CY24: PKR 165.3mln), and other income stood at PKR 407.9mln (CY24: PKR 385mln). Other expenses increased by 14.3% YoY to PKR 56.9bln (CY24: PKR 49.8bln), mainly due to higher costs related to technology infrastructure and branch expansion. Consequently, net profit stood at PKR 21.7bln (CY24: PKR 23bln), with industry-wide PAT remaining relatively stable, reflecting steady earnings performance.

Going forward, FABL plans to focus on mobilising low-cost core deposits and enhancing business volume via branch outreach. additionally, on the digital front, the Bank has embraced a transformative approach in digital banking, positioning itself amongst the industry leads, not only within the Islamic banking but also as a key digital player in the broader industry.

At end-Dec’25, FABL showcased a strong performance, with its financing portfolio increasing by 37.6% to PKR 872bln (end-Dec’24: PKR 634bln), reflecting the Bank’s effective strategies in expanding lending activities. The growth in financing is also reflected in the Advances to Deposit Ratio (ADR), which rose slightly to 61.1% (end-Dec’24: 60.7%), remaining higher than most peers and the industry average, indicating a relatively higher deployment of deposits in lending. The Top 20 Advances to Total Advances concentration stood at 18% (end-Dec’24: 21%), largely extended to sound corporate borrowers. Sector-wise, the Textile and Power sectors accounted for the largest exposures, with advances of PKR 125.6bln (end-Dec’24: PKR 108.9bln) and PKR 108.9bln (end-Dec’24: PKR 86.4bln), respectively. On a segment basis, advances to the Private Segment increased to PKR 688.3bln (end-Dec’24: PKR 530.9bln), while the Government/Public Segment rose to PKR 218.8bln (end-Dec’24: PKR 144.1bln), bringing gross advances to PKR 907.2bln (end-Dec’24: PKR 675bln). On the asset quality front, Non-Performing Financing decreased to PKR 20.4bln (end-Dec’24: PKR 24.3bln). The Top 20 NPLs to Total NPLs concentration increased slightly to 53% (end-Dec’24: 49%), with the Textile and Iron & Steel sectors contributing the largest NPLs at PKR 4.5bln (end-Dec’24: PKR 5.9bln) and PKR 3.2bln (end-Dec’24: PKR 2.6bln), respectively. Overall, FABL’s financial profile remains strong, supported by a robust deposit base, a growing and well-diversified financing portfolio across sectors and segments, and prudent credit risk management, despite a relatively higher ADR compared with peers and moderate concentration in top NPLs.

At end-Dec’25, the investment portfolio of the Bank declined by ~6.3% YoY to PKR 634.9bln (end-Dec’24: PKR 677.4bln), with a strong concentration in government securities, which constitute about 90% of the total portfolio. A major portion of the funds generated from deposits was invested in Ijarah Sukuks totaling PKR 611.2bln, representing ~96.3% of the total investment portfolio, of which PKR 166.4bln (27.2%) are fixed and PKR 444.8bln (72.8%) are floating, reflecting FABL’s adherence to Sharia-compliant principles. The Bank’s investment portfolio is categorized into subsidiaries and associates, with a significant capital commitment to related parties. Total investments in associates, specifically the Faysal Islamic Savings Growth Fund (PKR 205.2mln) and Faysal Halal Amdani Fund (PKR 150mln), cumulatively amount to ~PKR 355.2mln (~0.06% of the total portfolio) and remained stable. In subsidiaries, the Bank maintains near-total ownership in Faysal Asset Management Limited (99.99%) and Faysal Islami Currency Exchange Company (Private) Limited (100%). The Bank’s investment in Faysal Asset Management Limited stood at PKR 1.1bln (~0.2% of the total portfolio), while investment in Faysal Islami Currency Exchange Company (Private) Limited increased to PKR 1.2bln (~0.2%) from PKR 1bln in CY24, reflecting capital support for its physical expansion from 15 booths to 48 booths and two branches. Overall, including these related-party holdings and other financial assets, the Bank’s total investment footprint stands at PKR 634.9bln, slightly lower than PKR 677.4bln in the previous year. FABL continues to prioritize stability, low-risk investments, and portfolio diversification across Sharia-compliant instruments and strategic subsidiaries and associates.

At end-Dec25, FABL's liquidity ratio was reported at 45.2% (end-Dec24: 50%). Overall, FABL’s strategy emphasizes maintaining a robust liquidity profile and a proactive approach to managing its deposit base, thereby supporting financial resilience and operational flexibility. The Current Account Ratio (CA) stood at 36.7% (end-Dec24: 38%), the Saving Account Ratio (SA) stood at 44.3% (end-Dec24: 46.4%), and the CASA ratio stood at 81% (end-Dec24: 84.4%).

As of end-Dec’25, the Bank remains well-capitalized, although its Capital Adequacy Ratio (CAR) has moderated to 14% (end-Dec’24: 16.5%), with a Tier I CAR of 12% (end-Dec’24: 13.2%), remaining above SBP’s minimum requirements. The moderation in CAR reflects higher utilization of capital in advances. The Bank’s equity base increased to PKR 115.4bln (end-Dec’24: PKR 108.4bln). To strengthen its capital position and offset the impact of higher advances on CAR, the Bank proposes to issue rated, unsecured, subordinated, privately placed, DSLR-listed Tier II qualifying long-term Sukuk (“Sukuk” or the “Instrument”) with a tenor of up to ten years and an issue size of up to PKR 7.0bln, inclusive of a green-shoe option of PKR 2.0bln. Being a Tier II instrument, the Sukuk will bolster the Bank’s total CAR, enhancing its risk absorption capacity. The Sukuk will be issued as a redeemable capital instrument in accordance with the Companies Act, 2017, relevant PSX regulations, and SBP Basel III Guidelines, and carries a call option exercisable after five years from the Issue Date, subject to SBP approval.