BankIslami Pakistan Limited (“BIPL” or the “Bank”), established in October 2004. It was the first Bank to receive Islamic Banking License under Islamic Banking Policy of 2003 on March 31, 2025. The Bank, after being declared a scheduled Islamic Bank by the State Bank of Pakistan in March 2005, commenced its operations on April 07, 2006. The Bank was founded with the vision of becoming the leading provider of authentic Islamic banking in Pakistan. Its mission is to save humanity from Riba by offering Shariah-compliant, customer-centric, innovative financial solutions, and creating value for our stakeholders, while upholding social responsibility and transparency. The Bank is operating through 550 branches including 60 sub-branches as at 9MCY25 (CY24: 540 branches including 60 sub-branches). The Bank is engaged in corporate, commercial, consumer, retail banking, and investment activities by offering a wide range of shariah-compliant products and services.

BankIslami Pakistan Limited is a subsidiary of JS Bank Limited (JSBL) with 75.12% shareholding. JSBL is part of the JS Group. Mr. Ali Hussain beneficially holds a 12.53% stake in BIPL, while the remaining shares are widely held by the general public. BIPL’s ownership is backed by the strong sponsorship of the JS Group — a well-renowned business group engaged in a diverse set of activities with a strategic focus on the financial sector including asset management, financial advisory, commodities trading, brokerage, insurance, and banking. BIPL ownership is backed by strong sponsorship i.e. JS Group and it is expected to remain the same in the foreseeable future. The sponsors demonstrate strong business acumen, underpinned by their well-diversified business interests across various sectors and their longstanding presence and active engagement in the financial and capital markets. This depth of experience reflects their strategic insight, financial discipline, and ability to navigate market dynamics effectively. The sponsors have demonstrated both the capacity and the willingness to extend financial support to the business, if and when required. This commitment is underpinned by their strong financial standing and a proactive approach to ensuring the stability and continuity of operations, which reflects positively on the overall financial risk profile of the Bank.

The Board of Directors (BoD) comprises eight members including four independent directors, three non-executive directors, and one executive director. Mr. Suleman Lalani - Chairperson is also Group President of Jahangir Siddiqui & Co. Limited. Mr. Lalani is a fellow member of the Institute of Chartered Accountants of Pakistan (ICAP) and has more than 30 years of experience in the financial services sector. Before his elevation to the position of Group President, he served JSCL as its Chief Executive Officer for more than a decade. Prior to joining JSCL, he was Executive Director Finance & Operations and Company Secretary of JS Investments Limited where he also served as CFO and Company Secretary for seven years. The BoD exercises close monitoring of the management’s policies and governs the Bank’s operations through its four committees namely (i) Audit Committee, (ii) Human Resource & Remuneration Committee, (iii) Risk Management Committee, and (iv) IT Committee. M/s KPMG Taseer Hadi & Co., Chartered Accountants are the external auditors of the Bank classified in category 'A' by SBP. They have expressed an unqualified opinion for the financial statements for the year ended on December 31, 2024.

BIPL’s organizational structure is divided into fourteen functional departments i) Distribution, ii) Corporate Banking, iii) Consumer, iv) Treasury/ FIs, v) Risk Management, vi) Product and Shariah Structuring, vii) Human Resource, viii) Legal, ix) Finance, x) Operations, xi) Security and Govt. Relations, xii) IT, xiii) Internal Audit and xiv) Compliance. All department heads have significant relevant professional experience and report to the CEO and Deputy CEO. The Bank also has an internal audit department, reporting directly to the Board’s Audit Committee. Mr. Rizwan Ata - CEO & President of BIPL, is a seasoned banker with over 32 years of rich experience in financial sector including over 17 years of experience in Islamic Banking industry. He has joined BIPL on January 01, 2019. Previously, he was Group Head - Islamic Banking at Bank Alfalah Limited. He has also worked in different managerial positions at Lahore, Faisalabad, Sialkot & Multan while working with Emirates Bank International PJSC. The Bank has eight committees at the management level. The Bank operates using a comprehensive Islamic Banking application that has inbuilt Shariah compliance features – iMal, a core banking software. For enhanced customer experience, the Bank is in the process of upgrading its core banking application. The Bank has launched its digital mobile application, branded as 'AIK', offering a comprehensive suite of financial services that closely mirrors the functionality of the Parent Bank's app, 'Zindagi'. As of Sep 2025, the platform has successfully mobilized deposits amounting to PKR 482mln, reflecting the Bank’s strategic commitment to expanding its presence in the digital banking space. 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 module supports the Bank in its Obligor Risk Rating (ORR) process by adding more objectivity to the credit appraisal process. The Bank has assigned a to 58% of its obligors under "Good and above" credit risk rating , while another 21% fall under the "Marginal and above" category. Approximately 2% of obligors are rated under "Overdue but not Classified and above," and 19% are categorized under "Loss and above."

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 (Source: SBP Compendium). The deposit share of the Bank remained intact at 2% based on customer deposits on standalone basis at the end of CY24 (CY23: 2%) and it also remained intact during 9MCY25 at 2%. During CY24, BIPL’s net interest margin increased by 15% YoY basis to stand at PKR 46.4bln (CY23: PKR 40.2bln) with gross return witnessing an increase of 22% to stand at PKR 112.8bln (CY23: PKR 92.8bln). Whereas, BIPL’s net interest margin stood at PKR 26.3bln at the end of 9MCY25 (9MCY24: PKR 33.9bln). The asset yield of the Bank declined to 18.7% (CY23: 19.2%) and 11.8% at the end of 9MCY25. Whereas, the Bank’s cost of funds inclined to 10.7% (CY23: 10.2%) and 6% at the end of 6MCY25. Consequently, the Bank’s spread contracted to 8% (CY23: 9%) and 5.8% at the end of 9MCY25. During CY24, the other income of the Bank inclined to PKR 4.6bln (CY23: PKR 3.3bln) with a major contribution of fee and commission income (CY24: PKR 2.3bln; CY23: PKR 1.8bln). However, this gain was partially offset by a sharp rise in other expenses, which surged by 37% YoY to PKR 22.7bln (CY23: PKR 16.6bln). The profit after taxation strengthened to PKR 11.8bln (CY23: PKR 11bln) reflecting the Bank’s ability to maintain profitability amid rising cost pressures due to expansion of branch network. Whereas, at the end of 9MCY25, the rapid policy-rate decline and MDR impact compressed spreads, dragging net profit margin down by 22% on YoY basis. Strong fee generation and gains on securities partially absorbed margin pressure. The Bank’s operating expenses registered a significant increase, primarily attributed to the ongoing branch network expansion. However, the profitability of the Bank dropped by 50% to PKR 5bln at the end of 9MCY25 (9MCY24: PKR 10.2bln), majorly due to dip in net profit margin and an increase in operating expenses. The sustained earnings growth, supported by improved non-core income, highlights the Bank’s resilience and diversified income base.

At end of CY24, BIPL's net advances registered a notable growth of 29% to stand at PKR 296bln (end-CY23: PKR 230bln). The Bank's net Advance-to Deposit Ratio (ADR) was reported at 52.9% (CY23: 44.1%). Whereas, at the end of 9MCY25, advances of the Bank contracted to PKR 259bln, contributing to a decline in the ADR to 47.9%. The non-performing loans - net (NPLs) decreased to PKR 2bln (CY23: PKR 3.4bln) during CY24 and also remained intact during 9MCY25. Meanwhile, the infection ratio is showing an improvement to 7.4% (CY23: 9%), indicating sustained asset quality despite the growth in lending but slightly increased to 7.6% at the end of 9MCY25. At the end of CY24, BIPL’s investment portfolio expanded to PKR 345bln (CY23: PKR 314bln), reflecting a prudent allocation strategy. The growth was primarily driven by an increase in Federal Government securities, which rose to PKR 311bln (CY23: PKR 278bln). Whereas, At the end of 9MCY25, BIPL’s investment grew to PKR 353bln. The investment mix remained heavily skewed towards government securities, indicating a conservative risk appetite, strong liquidity management, and alignment with capital preservation objectives. This composition also enhances the Bank’s earnings stability while ensuring regulatory compliance. The deposit base expanded to PKR 559bln (CY23: PKR 523bln), reflecting steady depositor confidence and growth momentum. Within the deposit mix, current deposits increased to PKR 208bln (CY23: PKR 182bln), while term deposits saw a slight contraction to PKR 192bln (CY23: PKR 198bln), indicating a mild shift toward low-cost funding. As of 9MCY25, the deposit base grew by 8% to stand at PKR 606bln (CY24: PKR 559bln) with a major contribution from current and term deposits. The Current Account (CA) and Savings Account (SA) ratios stood at 37% and 28% respectively at the end of CY24 and 41% and 26% at the end of 9MCY25. Overall, the deposit mobilization strategy and liquidity buffer reflect a balanced funding profile, contributing to financial stability and resilience in a high-rate environment. At end of CY24, BIPL’s equity base strengthened to PKR 48.3bln (CY23: PKR 36.5bln), primarily driven by sustained profitability. The Bank’s Capital Adequacy Ratio (CAR) improved to 24.11% (CY23: 23.79%), while the Tier I CAR rose to 18.67% (CY23: 17.78%), reflecting a robust capital position. The equity base, in turn, the risk absorption capacity of the Bank, stood at PKR 48bln at the end of 9MCY25 with the CAR stood at 17.78%, above the minimum regulatory requirement. To strengthen its capital base, the Bank has successfully issued two Additional Tier 1 Sukuks with a cumulative value of PKR 3,000mln. These capital instruments have been structured to enhance the Bank’s capital adequacy ratio, providing a buffer for loss absorption and supporting the Bank’s long-term growth and risk management objectives. The upward trajectory in both total and core capital indicators underscores BIPL’s strong loss-absorption capacity, prudent risk-weighted asset management, and adequate capital buffers well above regulatory requirements, positioning the Bank comfortably to support future growth and absorb potential shocks.

BIPL has issued a fully paid-up, rated, listed, perpetual, unsecured, subordinated, non-cumulative, and contingent convertible listed modaraba Sukuk certificates (“Sukuk”). The issue amounts to PKR 1 billion. The tenor of the Sukuk is perpetual and carries a profit rate of 1MK + 2.5%. The profit is paid monthly in arrears on the outstanding principal amount on a non-cumulative basis. The amount raised is part of Bank's Additional Tier 1 Capital for the capital adequacy ratio as per guidelines set by SBP. The funds are being utilized in the Bank's financing and investing activities. BIPL may choose to exercise a call option on the Sukuk after five years from the issuance date.

The Sukuk holders are a part of the general pool. The claims of the investors will rank a) superior to the claims of ordinary shareholders in case of going concern as well as a gone concern (in case the Sukuk are not already converted into the common share of the Bank), and b) pari passu without preference amongst Sukuk holders. The Sukuk is also subject to the lock-in clause i.e. the profit payment to the Sukuk holders will be subject to the condition that any such payment should not result in the noncompliance with the applicable regulatory requirement of MCR, CAR and leverage ratio (LR) as determined by SBP from time to time. Any inability to exercise the lock-in clause or non-cumulative feature will subject these Sukuk certificates to mandatory conversion into common shares at the discretion of SBP.

The Sukuk is unsecured.