Bank AL Habib Limited ("BAHL" or the "Bank"), incorporated as a public limited Company, commenced operations as a Scheduled Commercial Bank in 1992 and was listed at the Pakistan Stock Exchange. The Bank’s registered office is located in the city of Multan in Punjab, and its principal office is located in Karachi. The Bank's principal activities are to provide commercial banking services to individuals and institutional clients. The Bank has an existing branch network of 1,295 as of the end Sep'25 (end-Dec24: 1,221) branches, including 350 (end-Dec24: 350) Islamic banking branches. BAHL has been operating 2 overseas branches in the Kingdom of Bahrain and Malaysia (Labuan) and 3 representative office one each in Dubai, Istanbul, and Beijing. Further, branch expansion is expected in CY25.

The shareholding in BAHL, to the extent of (48.9%), is held by the Habib family along with their friends and associates, Other significant shareholders include joint stock companies (17.2%) and investment and insurance companies (9.08%). The ownership structure of the Bank is seen as stable as the majority stake rests with the sponsors. Sponsors are members of the Habib Family - one of the oldest and most distinguished names in Pakistan's banking sector. Their significant experience and business acumen in commercial banking have been of value, as their background has allowed them to proactively deal with the changing dynamics of the industry and demonstrate consistent performance. BAHL is the flagship business of sponsors. Hence, willingness to support the Bank in case the need arises is considered high; also supplemented by access to the capital markets.

BAHL’s nine-members Board includes three representatives of Habib Family, three members are independent directors while one is executive director. The Board members have extensive experience in the banking and commercial industries of Pakistan and are actively involved in providing strategic input and guidance to the management. CEO is a seasoned professional banker, who has been with the Bank for over 28 years. There are six Board committees that assist the Board in the effective oversight of the Bank’s overall operations on relevant matters. The Board provides overall guidelines on managing risks associated with the Bank’s operations and strategic direction. These committees are 01) Audit Committee, 02) Human Resource & Remuneration Committee, 03) Credit Risk Management Committee, 04) Risk Management Committee, 05) IT Committee and 06) Islamic Banking Conversion Committee. The auditors of the Bank are KPMG Taseer Hadi & Co, Chartered Accountants, classified in category 'A' by SBP and having a "satisfactory" in QCR rating. They have expressed an unqualified opinion on the Bank’s financial statements for the year ended December 31, 2024.

The Bank has established well-developed management tiers and robust succession planning frameworks to ensure leadership continuity across all key positions. Its organizational structure is designed to be horizontal, promoting collaboration and efficient decision-making. Operational responsibilities are strategically distributed among Division Heads, each overseeing distinct functional areas, which fosters accountability, enhances operational oversight, and supports the Bank's long term strategic goals. This structure enables the Bank to remain agile, responsive, and well-positioned to manage growth and risk effectively. The strength of the Bank comes from the core team of experienced senior banking professionals, who have sizable experience in commercial banking, locally and abroad. The Bank has established five internal committees at the management level to oversee day-to-day operations and ensure effective execution of strategic objectives. These committees facilitate informed decision-making, promote operational efficiency, and enhance governance across key functional areas. The Bank is using in-house developed software named ‘AL Habib Banking System -AHBS’ as its core banking software that allows real-time online connectivity with other subsystems operating in the Bank. The Bank also has a separate Information Security Department. Bank AL Habib (BAHL) has a robust risk management framework designed to effectively identify, assess, and mitigate the various risks the Bank is exposed to. The overall responsibility for risk oversight rests with the Board of Directors, which discharges this role through its specialized committees. To support this framework, the Bank has established a dedicated Risk Management Division (RMD) that operates independently to monitor and manage risk across all business areas.

During 9MCY25, Pakistan's Banking sector's total assets posted growth of ~9.5% YTD whilst investments surged by ~23.4% to PKR ~36.7trln (CY24: PKR ~29.8trln). Net Advances of the sector recorded a decline of ~16.3% to stand at PKR ~13.2trln (CY24: PKR ~15.8trln). Non-performing loans witnessed a decrease of 11.2% YTD to PKR ~948bln (CY24: PKR ~1,068bln). The CAR averaged at 22.1% (CY24: 20.6%). Given the low monetary rate and high cost environment, Banks are likely to show some dilution in profitability by the end of CY25. At end-Sep25, BAHL, a large-sized Bank, holds almost same position in the industry as comapred to last year 7.00% (end-Dec24:7.31%) market share in terms of total deposits. During Sep'25 the Bank’s deposit base stands at PKR 2,497bln (end-Dec'24: PKR 2,278bln) reflecting an increase of 9.6%. At the end Sep'25, BAHL’s NIMR witnessed an decrease of 17% on a YoY basis to stand at PKR 99.3bln (Sep'24: PKR 117.4bln). primarily attributable to decreased markup earned amounting to PKR 260bln (Sep'24: PKR 367bln). The Bank’s asset yield stand at 12.2% (Sep'24: 19.6%), whereas the cost of funds stands at 7.3% (Sep'24: 12.8%). The Bank’s spread stands at 4.9% (Sep'24: 6.8%). During Sep25, non-markup income increased year-on-year (YoY) to PKR 22.1bln, compared to PKR 19.5bln in Sep'24. This growth was primarily driven by fee and commission income, which stands at PKR 14.1bln (Sep'24: PKR 14.1bln), followed by foreign exchange income of PKR 5.6bln (Sep'24: PKR 3.8bln).The Bank has significant share in trading as well as remittance. On the expense side, non-markup expenses increased by 15% YoY, reaching PKR 71bln, up from PKR 61.8bln in Sep'25. The Bank’s net profitability stands at, amounting PKR 25.3bln in Sep'25 compared to PKR 33bln in Sep'24.

As of end-September 2025, the Bank’s net advances remain intact PKR 906.6bln compared to PKR 910.8bln at end-December 2024. However, the Advances-to-Deposits Ratio (ADR) declined to 36.2% from 39.9% in Dec'24. The Bank’s infection ratio increased to 3.7% (end-December 2024: 3.7%), primarily due to a intact in non-performing loans (NPLs), which stands at PKR 35.5bln from PKR 35bln. At end-Sep25, the investment portfolio of the Bank stands at PKR 1,847bln including debt instruments (end-Dec24: PKR 1,924bln). Government securities constitute 98.8% of total investments (end-Dec24: 99.1%). By the end of Sep25, the Bank's deposit portfolio expanded by 9.6%, reaching PKR 2,497bln compared to PKR 2,279bln as of end-Dec24. The composition of deposits reflected a Current Account (CA) ratio of 37.7% and a Savings Account (SA) ratio of 40.1% (end-Dec24: 34.3% and 41%, respectively). The Bank's liquidity position remain stable, with the Liquid Assets ratio stands at 68.6%, compared to 70.6% at the close of Dec24 and Liquid coverage ratio stands at 294.4% (Dec'24: 272.1%). As of end-Sep25, BAHL’s paid-up capital remained at PKR 11bln. However, the Bank’s equity base rose to PKR 166bln (end-Dec24: PKR 151.9bln), primarily driven by enhanced profitability. Consequently, The Bank’s Capital Adequacy Ratio (CAR) improved to 18.7% as of the latest reporting period, up from 17.9% at end-December 2024. This includes a Tier I CAR of 14.4%, Tier II CAR of 4.3%, all in compliance with the minimum regulatory requirements set by the State Bank of Pakistan. The Bank has issue four bonds totaling PKR 26 billion.

BAHL has issued a rated, unlisted, unsecured and subordinated TFC-VIII (“TFC” or the “Issue” or “Instruments”) on Sep-21. The issue amount is PKR 5bln to contribute towards AL Habib's Tier II Capital. The funds raised are utilized in the Bank's normal business operations. The tenor of the instrument is 10 years and callable on or after five years with prior approval of SBP. The profit rate is 6M-KIBOR plus 75bps and would be paid semi-annually in arrears on the outstanding principal. The instrument is structured to redeem 0.02% of the Issue Amount per semi-annual period in the first nine years and remaining Issue Amount in two equal semi annual instalments of 49.82% each in the tenth year. BAHL may call the TFCs (either partially or in full), with prior approval of SBP, on any profit payment date on or after five years from the date of issue.

The Instrument is unsecured and subordinated as to payment of principal and profit to other indebtedness of the Bank, including deposits, but will rank pari passu with other Tier II instruments and superior to Additional Tier I instruments and common shares. The Bank may call the TFCs (either partially or in full), with prior approval of SBP, on any profit payment date on or after five years from the date of issue, subject to not less than 60 days prior notice being given to the investors. The Instrument is subject to (1) Lock-in Clause which states that neither profit nor principal may be paid if such payments will result in shortfall in the Bank’s Minimum Capital Requirement (“MCR”) or Capital Adequacy Ratio (“CAR”) or Leverage Ratio (“LR”) or increase any existing shortfall in MCR, CAR and LR, and (2) Loss Absorption and/or any other requirements under SBP’s Basel III Capital Rules. Upon the occurrence of a Point of Non-Viability event as defined by SBP’s Basel III Capital Rule, SBP may at its option, fully and permanently convert the TFCs into common shares of the Bank and/or have them immediately written off (either partially or in full). Number of shares to be issued to TFC holders at the time of conversion will be equal to the ‘Outstanding Value of the TFCs divided by Market value per share of the Bank’s common share on the date of trigger event as declared by SBP, subject to a cap of 80 million shares

The Instrument is unsecured and subordinated.