mcb first quarter result 2012
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7/31/2019 MCB First Quarter Result 2012
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To be the leading financial services provider, partnering with our customers for a more prosperous and secure future
Our Vision
We are a team of committed professionals, providing innovativeand efficient financial solutions to create and nurture long-term
relationships with our customers. In doing so, we ensurethat our shareholders can invest with confidence in us
Our Mission
The standards and principles which determine our behavior and how we interact with our customers and each other
Our Values
MCB
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MCMCB Bank Limited
CORPORATE PROFILE
Mian Mohammad Mansha Chairman
S.M. Muneer Vice Chairman
Tariq Rafi Director
Shahzad Saleem Director
Sarmad Amin Director
Director
Director
Director
Director
Director
Director
Director
M.U.A. Usmani
Abdul Farid Bin Alias
President / CEO
Board of Directors:
Mian Raza Mansha
Aftab Ahmad Khan
Manzar Mushtaq
Dato’ Seri Ismail Shahudin
Mian Umer Mansha
Member
Member Member
Tariq Rafi Chairman
Audit Committee:
Aftab Ahmad Khan
Dato’ Seri Ismail Shahudin
Ahmad Alman Aslam
Ahmad Alman Aslam
Company Secretary: Abdus S. Sami
Auditors: M/s. A.F. Fergusons & Co.
Chartered Accountants
Legal Advisors: M/s.
Advocates & Legal Consultants
Khalid Anwer & Co.
Chief Financial Officer: Salman Zafar Siddiqi
Registrar's and Share
Registration Office:
M/s. THK Associates (Pvt.) Ltd
State Life Building No. 3
Dr. Ziauddin Ahmed Road
Karachi, Pakistan
Principal Office: MCB 15 Main Gulberg,
Lahore, Pakistan.
Registered Office: MCB Building F-6/G-6,
Jinnah Avenue, Islamabad,
Pakistan.
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April, 24, 2012
MCMCB Bank Limited
Ratings
Economy Review
Future Outlook
Acknowledgement
PACRA maintained the long term credit rating of AA+ [double A plus] and short term credit rating A1+ [A one plus] of the Bank, through its notification in June 2011 (2010: Long term: AA+ [doublplus] and Short term: A1+ [A one plus]).
The macroeconomic platform of the economy is in much need of prudent corrections aninstigation of enforced measures to curb the impaired controls on inflationary pressures. Tprevalent political unrest, trade gaps, deteriorating reserves and international pressure commodity prices are reaping its adversities at a much higher pace. In the banking sectoremarkable results have been witnessed in a continuing trend despite economic disturbanceHowever, the modes and quality of financing is a major concern vis-à-vis the invisible demandthe private sector and limited growth opportunities in the area. Growing concentration levelsgovernment securities at banking industry level has raised concerns internationally and is likelyimpact ratings of financial institutions. However, to spur private sector credit, concrete remedactions are required with stable discount rate being the only factor considered so far.
Moving forward, unless the adversities are reversed there remains little room for foreiinvestments and injections in the economy. Main industries have already suffered the loss on pof power shortages and lack of government support. Tax evasion issues, rising deficit, impactnegative parity on exchanges and debt repayments is putting the economy under further stra Although equity market has per formed exceptionally well in the first quarter of 2012, necessameasures should be adopted to repose international confidence going forward.
MCB Bank Limited is determined in growth and creating opportunities to strengthen itself furthermeet the fore coming challenges. The Bank's focus shall be in product and services innovatiofurther improvements in quality of services on offer, improved use of technology, strengtheninginternal policy and control frameworks and adding value in the economy through its channel businesses.
In the end the Board would like to greet and thank all shareholders and customers for their trust, ostaff for their continuous hard work and dedication, and the Government and the State Bank Pakistan for their patronage and support.
MCBMCB Bank Limited
DIRECTORS' REPORT - MARCH, 2012
3 First Quarterly Report, 2012
On behalf of Directors
First Quarterly Report, 2012
I am pleased to place before you, on behalf of the Board of Directors, the quarterly financial statements of your Bank for the period ended March 31, 2012.
Performance Review
The Bank registered remarkable performance in the first quarter as profit before and after taxincreased to Rs. 8.656 billion and Rs. 5.644 billion respectively, increasing by 10% and 12% over the corresponding quarter last year. Net markup income of the Bank decreased by 2% over March2011 whereas non-markup income increased by 20% to Rs. 2.413 billion. On the operatingexpenses side, gross administrative expenses (excluding the impact of pension fund reversal)increased by a controlled growth of 11% over March 2011, whereas provisions significantlyreduced by 94% to Rs. 75 million.
The asset base of the Bank grew to Rs. 666.644 billion from Rs. 653.233 billion as at year end 2011. Advances (gross) of the Bank registered a growth of 2% over December 31, 2011, increasing to Rs.252.787 billion. The classified portfolio of the Bank decreased by 1% owing to effective riskmanagement framework adopted by the Bank, improving the quality of advances with a lower infection ratio of 10.38% from 10.75% in December 31, 2011. The investment portfolio increasedby 3% over December 2011 to Rs. 327.630 billion. The deposit base of the Bank went up by 4%,
with 3% and 8% increase r eported in current and saving deposits respectively, improving the CASApercentage to 82% from 81% as of December 31, 2011.
Earnings per share (EPS) for the quarter was reported at Rs. 6.14 compared to Rs. 5.46 for thecorresponding quarter last year. Return on assets improved to 3.42% (2011: 3.18%) whereasreturn on equity improved to 28.09% (2011: 26.23%).
ChairmanMian Mohammad Mansha
Financial Highlights
Transfer from Surplus on Revaluation of Fixed Assets (net of tax)
Profit Available for Appropriation
Appropriations:
Statutory ReserveFinal Cash Dividend – December 2011
Issue of Bonus Shares – December 2011
Total Appropriations
Un-appropriated Profit Carried Forward
Profit Before Taxation
Un-appropriated Profit Brought Forward
Profit After Taxation
Taxation
8,656
9
28,375
34,019
564
2,509
836
3,909
30,110
Rs. in Millions
28,366
5,644
(3,012)
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Unconsolidated Condensed Interim Statement of Financial Position (Un-audited)As at March 31, 2012
MCBMCB Bank Limited MCMCB Bank Limited
Unconsolidated Condensed Interim Profit and Loss Account (Un-audited)
5 First Quarterly Report, 2012 First Quarterly Report, 2012
Unaudited Audited
Note March 31, December 31,
2012 2011
Assets
Cash and balances with treasury banks 46,915,513
53,122,522
Balances with other banks 2,451,944
2,281,263
Lendings to financial institutions 7 2,819,768
955,087
Investments - net 8 327,630,294
316,651,613
Advances - net 9 230,456,782
225,801,259
Operating fixed assets 22,368,978
22,007,903
Deferred tax assets - net -
-
Other assets - net 34,000,787
32,413,576
666,644,066
653,233,223
Liabilities
Bills payable 8,404,870
9,466,818
Borrowings 10 28,544,617
39,100,627
Deposits and other accounts 11 512,067,061 491,188,710 Sub-ordinated loan - - Liabilities against assets subject to finance lease -
-
Deferred tax liabilities - net 12 6,538,486
6,294,886
Other liabilities 18,658,258
18,379,700
574,213,292
564,430,741
Net assets 92,430,774
88,802,482
Represented by:
Share capital 9,198,601
8,362,365
Reserves 42,505,941
42,186,467
Un-appropriated profit 30,109,900
28,366,171
81,814,442
78,915,003
Surplus on revaluation of assets - net of tax 10,616,332
9,887,479
92,430,774
88,802,482
Contingencies and commitments 13
---------- (Rupees in '000) ----------
The annexed notes 1 to 21 form an integral part of these unconsolidatedcondensed interim financial statements.
Note
Mark-up / return / interest earned 17,545,206 15,960,
Mark-up / return / interest expensed 6,846,822 5,036,8
Net mark-up / interest income 10,698,384 10,923,
Provision against loans and advances - net 74,532 1,002,3
Provision for diminution in the value of investments - net 591 187,1
Bad debts written off directly 120 7,3
75,243 1,196,8
Net mark-up / interest income after provisions 10,623,141 9,726,2
Non mark-up / interest income
Fee, commission and brokerage income 1,462,470 1,182,2
Dividend income 505,117 188,5
Income from dealing in foreign currencies 255,268 213,9
Gain on sale of securities - net 55,436 278,4
Unrealized loss on revaluation of investments classified as held for trading (1,486) -
Other income 136,694 144,7
Total non mark-up / interest income 2,413,499 2,008,0
13,036,640 11,734,
Non-mark-up / interest expenses
Administrative expenses 4,123,496 3,668,9
Other provisions / (reversals) 15,775 (13,7
Other charges 241,136 242,7
Total non mark-up/interest expenses 4,380,407 3,897,9
8,656,233 7,836,3
Extra ordinary / unusual item - -
Profit before taxation 8,656,233
7,836,
Taxation - current period 2,769,475 2,705,6
- prior years - -
- deferred 242,617 107,0
3,012,092 2,812,7
Profit after taxation 5,644,141 5,023,6
Earnings per share - basic and diluted - Rupees 14 6.14 5.4
The annexed notes 1 to 21 f orm an integral part of these unconsolidated condensed interim financial statements.
Quarter end
March 31
2011
Quarter ended
March 31,
2012
---------- (Rupees in '000) ------
For the three months period ended March 31, 2012
Sarmad Amin
Director
S.M. Muneer
President / CEOM.U.A. Usmani Mian Umer Mansha Sarmad Amin
Director
S.M. Muneer
President / CEOM.U.A. Usmani Mian Umer Mansha
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Unconsolidated Condensed Interim Cash Flow Statement (Un-audited)For the three months period ended March 31, 2012
MCMCB Bank LimitedMCBMCB Bank Limited
Unconsolidated Condensed Interim Statement of Comprehensive Income (Un-audited)For the three months period ended March 31, 2012
7 First Quarterly Report, 2012 First Quarterly Report, 2012
Profit after tax for the period 5,644,141
5,023,617
Other comprehensive income
Effect of translation of net investment in foreign branches (244,940) 4,773
Comprehensive income transferred to equity 5,399,201 5,028,390
Components of comprehensive income not reflected in equity
Net change in fair value of available for sale securities 738,786 34,146
Deferred tax (985) (80,094)
737,801 (45,948)
Total comprehensive income for the period 6,137,002 4,982,442
The annexed notes 1 to 21 form an integral part of these unconsolidated condensed interim financial statements.
Quarter ended
March 31,
2012
Quarter ended
March 31,
2011
March 31, March 31,2012 2011
Cash flows from operating activities
Profit before taxation 8,656,233 7,836,37Less: Dividend income (505,117) (188,51
8,151,116 7,647,85Adjustments for non-cash charges
Depreciation 312,693 265,91
Amortization 62,391 47,02Provision against loans and advances - net 74,532 1,002,30Provision for diminution in the value of investments - net 591 187,17Other provisions / (reversals) 15,775 (13,76Bad debts written off directly 120 7,39Unrealized loss on revaluation of investments classified as held for trading 1,486 -Gain on disposal of fixed assets (4,298) (3,79
463,290 1,492,25
8,614,406 9,140,1(Increase) / decrease in operating assets
Lendings to financial institutions (1,864,681) 3,376,78
Net investment in held for trading securities (5,198,447) -
Advances - net (4,730,175) (5,514,46
Other assets - net 1,522,562 (233,58(10,270,741) (2,371,26
Increase / (decrease) in operating liabilities
Bills payable (1,061,948) (638,93
Borrowings (10,556,010) 3,985,76
Deposits and other accounts 20,878,351 30,929,0
Other liabilities (1,895,995) (2,042,507,364,398 32,233,3
5,708,063 39,002,2
Income tax paid (5,657,112) (3,953,96
Net cash flows from operating activities 50,951 35,048,2
Cash flows from investing activities
Net investments in available-for-sale securities (6,631,753) (37,400,10
Net investments in held-to-maturity securities 1,588,228 118,59Investment in associated undertaking - (52,52
Dividend income received 267,203 117,50
Investment in operating fixed assets - net of disposals (731,861) (765,52
Net cash flows from investing activities (5,508,183) (37,982,04
Cash flows from financing activities
Dividend paid (334,156) (258,57
Net cash flows from financing activities (334,156) (258,57
Exchange difference on translation of net investment in f oreign branches (244,940)
4,77
---------- (Rupees in '000) ------
Increase in cash and cash equivalents (6,036,328) (3,187,57
Cash and cash equivalents at January 1 55,403,785 46,885,7
Cash and cash equivalents at March 31 49,367,457 43,698,1
The annexed notes 1 to 21 f orm an integral part of these unconsolidated condensed interim financial statements.
Sarmad Amin
Director
S.M. Muneer
President / CEOM.U.A. Usmani Mian Umer Mansha Sarmad Amin
Director
S.M. Muneer
President / CEOM.U.A. Usmani Mian Umer Mansha
---------- (Rupees in '000) ----------
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MCBMCB Bank Limited
Unconsolidated Condensed Interim Statement of Changes in Equity (Un-audited)For the three months period ended March 31, 2012
MCMCB Bank Limited
Notes to the Unconsolidated Condensed Interim Financial Statements (Un-auditeFor the three months period ended March 31, 2012
9
First Quarterly Report, 2012 First Quarterly Report, 2012
Balance as at December 31, 2010 7,602,150
-
9,702,528
345,979
11,514,399
18,600,000
21,414,955
69,180,011
Change in equity for three months ended March 31, 2011
Transferred from surplus on revaluation of fixed
assets to unappropriated profit - net of tax -
-
-
-
-
-
8,947
8,947
Exchange differences on translation of net
investment in foreign branches -
-
-
4,773
-
-
-
4,773
Profit after taxation for three months period
ended March 31, 2011 -
-
-
-
-
-
5,023,617
5,023,617
Tot al co mp re h en s iv e in co me fo r t he pe rio d e n de d M ar ch 31 , 2 01 1 -
-
-
4,773
-
-
5,023,617
5,028,390
Transferred to statutory reserve -
-
-
-
502,362
-
(502,362)
-
Transfer to reserve for issue of bonus shares -
760,215
-
-
-
-
(760,215)
-
Final cash dividend - December 31, 2010 -
-
-
-
-
-
(2,280,645)
(2,280,645)
Balance as at March 31, 2011 7,602,150
760,215
9,702,528
350,752
12,016,761
18,600,000
22,904,297
71,936,703
Change in equity for nine months ended December 31, 2011
Transferred from surplus on revaluation of fixed
assets to unappropriated profit - net of tax -
-
-
-
-
-
26,841
26,841
Exchange differences on translation of net
investment in foreign branches -
-
-
76,297
-
-
-
76,297
Profit after taxation for nine months period
ended December 31, 2011 -
-
-
-
-
-
14,401,289
14,401,289
Total comprehensive income for nine months ended December 31, 2011 -
-
-
76,297
-
-
14,401,289
14,477,586Transferred to statutory reserve -
-
-
-
1,440,129
-
(1,440,129)
-
Issue of bonus shares - December 31, 2010 760,215
(760,215)
-
-
-
-
-
-
Interim cash dividend - March 31, 2011 -
-
-
-
-
-
(2,508,709)
(2,508,709)
Interim cash dividend - June 30, 2011 -
-
-
-
-
-
(2,508,709)
(2,508,709)
Interim cash dividend - September 30, 2011 -
-
-
-
-
-
(2,508,709)
(2,508,709)
Balance as at December 31, 2011 8,362,365
-
9,702,528
427,049
13,456,890
18,600,000
28,366,171
78,915,003
Change in equity for three months ended March 31, 2012
Transferred from surplus on revaluation of fixed
assets to unappropriated profit - net of tax -
-
-
-
-
-
8,947
8,947
Exchange differences on translation of net
investment in foreign branches -
-
-
(244,940)
-
-
-
(244,940)
Profit after taxation for three months period
ended March 31, 2012 -
-
-
-
-
-
5,644,141
5,644,141
Tot al co mp re h en s iv e in co me fo r t he pe rio d e n de d M ar ch 31 , 2 01 2 -
-
-
(244,940)
-
-
5,644,141
5,399,201
Transferred to statutory reserve -
-
-
-
564,414
-
(564,414)
-
Transfer to reserve for issue of bonus shares -
836,236
-
-
-
-
(836,236)
-
Issue of bonus shares - December 31, 2011 836,236 (836,236) - - - - - -
Final cash dividend - December 31, 2011 - - - - - - (2,508,709) (2,508,709)
Balance as at March 31, 2012 9,198,601 - 9,702,528 182,109 14,021,304 18,600,000 30,109,900 81,814,442
The annexed notes 1 to 21 form an integral part of these unconsolidated condensed interim financial statements.
Reserve for
issue of bonus
shares
Revenue Reserves
---------------------------------------------------------- (Rupees in'000) ----------------------------------------------------------
Share
premium
Statutory
reserve
TotalShare capital
Capital Reserves
General
reserve
Exchange
translation
reserve
Unappropriated
profit
1 STATUS AND NATURE OF BUSINESS
2 BASIS OF PRESENTATION
2.1
2.2
3 STATEMENT OF COMPLIANCE
3.1
3.2
3.3
4 BASIS OF MEASUREMENT
4.1
4.2
5 SIGNIFICANT ACCOUNTING POLICIES AND RISK MANAGEMENT
5.1
5.2
MCBBank Limited('the Bank') is a bankingcompanyincorporatedin Pakistan and is engaged in commercialbankingand r
services. The Bank'sordinary sharesare listed on all thestock exchangesin Pakistan whereas its Global Depositary Re
(GDRs)(representing twoordinary equity shares)are traded on the InternationalOrder Book (IOB) system of the London
Exchange.TheBank'sregisteredofficeand principaloffice aresituated at MCBBuilding,Jinnah Avenue,Islamabadand MC
Main,Gulberg,Lahore,respectively.The Bankoperates1,165branchesincluding22Islamicbanking branches(December31,
1,165 branchesincluding22 Islamicbankingbranches)within Pakistanand 8(December 31,2011:8) branchesoutside theco
(including the Karachi Export Processing Zone Branch).
Inaccordancewiththe directivesof theFederal Governmentregardingthe shiftingof thebanking systemto Islamicmodes,the
Bank of Pakistan has issued various circulars fromtime to time. Permissibleforms of trade-related modes of financing in
purchaseof goodsby banksfrom their customersand immediateresale to themat appropriatemark-up in priceon deferredpay
basis. The purchases and sales arising under these arrangements are not reflected in these unconsolidated condensed i
financial statementsas such butare restricted to theamount of facilityactuallyutilized andthe appropriate portion of m
thereon.
Thefinancial resultsof theIslamicbankingbrancheshave been consolidatedin these unconsolidatedcondensed interimfin
statementsfor reportingpurposes,aftereliminatingmaterial intra branch transactions/ balances.Keyfinancialfiguresof theI
banking branches are disclosed in note 18 to these unconsolidated condensed interim financial statements.
Theseunconsolidatedcondensedinterimfinancialstatementshavebeenpreparedin accordancewithapproved accounting sta
as applicable in Pakistan. Approved Accounting Standardscomprise of such InternationalFinancial Reporting Standards(
issuedby theInternationalAccountingStandardsBoard(IASB)asare notifiedunderthe CompaniesOrdinance,1984,provisio
anddirectivesissuedunder theBankingCompaniesOrdinance,1962,the CompaniesOrdinance, 1984,and thedirectivesissu
SBP. In case requirements differ, the provisions of and directives issued under the Banking Companies Ordinance, 196
Companies Ordinance, 1984, and the directives issued by SBP shall prevail.
The State Bankof Pakistanhas deferred the applicability of InternationalAccounting Standard (IAS) 39,'Financial Instrum
Recognition and Measurement' and International Accounting Standard (IAS) 40, 'Investment Property' for Banking Comp
through BSDCircular No.10 dated August 26,2002.The Securities and ExchangeCommission of Pakistan (SECP) hasdef
applicability of IFRS-7"FinancialInstruments:Disclosures"on banksthrough S.R.O411(1)/2008 datedApril 28,2008. Accord
therequirementsof these standardshave notbeen considered inthe preparation of theseunconsolidated condensedinterim fin
statements.However,investmentshavebeen classifiedand valued inaccordance withtherequirementsprescribedby theStat
of Pakistan through various circulars.
Thedisclosuresmadein theseunconsolidatedcondensedinterimfinancialstatementshave,howeverbeen limitedbasedon the
prescribedby the State Bank of Pakistan vide BSD Circular No. 2 dated May 12, 2004 and InternationalAccounting Standa
"Interim Financial Reporting". They do not include all of the disclosures required for annual financial statements and
unconsolidatedcondensedinterimfinancialstatementsshouldbe readinconjunctionwiththe financialstatementsof theBank
year ended December 31, 2011.
These unconsolidated condensed interim financial statements are presented in Pak Rupees, which is the Bank'sfunction
presentation currency.
Thefinancial riskmanagementobjectives and policiesare consistent withthosedisclosed in theannual financialstatements
Bank for the year ended December 31, 2011.
These unconsolidatedcondensed interimfinancial statements havebeen prepared underthe historical costconvention exce
certainfixedassetsarestatedat revaluedamounts,certaininvestments,commitmentsin respectof certainforward foreignexc
contracts and derivative financial instruments have been marked to market and are carried at fair value.
Theaccounting polices adopted in thepreparationof these unconsolidatedcondensed interim financialstatementsare thesa
those applied in the preparation of the annual financial statements of the Bank for the year ended December 31, 2011.
Sarmad Amin
Director
S.M. Muneer
President / CEOM.U.A. Usmani Mian Umer Mansha
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MCBMCB Bank Limited
Notes to the Unconsolidated Condensed Interim Financial Statements (Un-audited)For the three months period ended March 31, 2012
MCMCB Bank Limited
Notes to the Unconsolidated Condensed Interim Financial Statements (Un-auditeFor the three months period ended March 31, 2012
11 First Quarterly Report, 2012 First Quarterly Report, 2012
Surplus on revaluation of available for sale securities - net
Investments at revalued amounts - net of provisions
8.2 Investments include Pakistan Investment Bonds amounting to Rs. 232.600 million (December 31, 2011: Rs. 232.600 million)
earmarked by theState Bank of Pakistan and National Bank of Pakistan against TT / DD discounting facilities and demand note
facilities sanctioned to the Bank. In addition, Pakistan Investment Bonds amounting to Rs. 5 million (December 31, 2011: Rs. 5 million)
have been pledged with the Controller of Military Accounts on the account of Regimental Fund Account.
472,254
291,848,744
13,483
24,802,869
485,737 316,651,613
6
7. LENDINGS TO FINANCIAL INSTITUTIONS March 31, December 31,
2012 2011
-
-
2,819,768 955,087
2,819,768 955,087
8 IN VES TM EN TS - NE T
8.1 Investments by types
Held-for-trading securities 5,198,447
-
5,198,447
Available-for-sale securities 8.2 301,670,391
13,548,342
315,218,733
Held-to-maturity securities 8.2 7,304,613
62,087
7,366,700
314,173,451
13,610,429
327,783,880
Associates 8.3 1,059,421
-
1,059,421
Subsidiaries 482,208
-
482,208
1,541,629 - 1,541,629
Investments at cost 315,715,080 13,610,429 329,325,509
Less: Provision for diminution in the value of investments(2,918,252)
-
(2,918,252)
Investments (net of provisions) 312,796,828
13,610,429
326,407,257Surplus / (deficit) on revaluation of available for sale securities - net 1,231,109
(6,586)
1,224,523Deficit on revaluation of held-for-trading securities - net (1,486)
-
(1,486)
Investments at revalued amounts - net of provisions 314,026,451
13,603,843
327,630,294
Held-for-trading securities -
-
-
Available-for-sale securities 8.2 284,689,998
24,306,386
308,996,384
Held-to-maturity securities 8.2 8,471,928
483,000
8,954,928
293,161,9 26 24,789,386 317,951,312
Associates 8.3 1,059,421 - 1,059,421
Subsidiaries 482,208 - 482,208
1,541,629 - 1,541,629
Investments at cost 294,703,5 55 24,789,386 3 19,492,941
Less: Provision for diminution in the value of investments (3,327,065) - (3,327,065)
Investments (net of provisions) 291,376,4 90 24,789,386 316,165,876
Given as
collateral
Held by
bank
Given as
collateral
Call money lendings
SIGNIFICANT ACCOUNTING ESTIMATES AND JUDGMENTS
TotalHeld by
bank
Thebasisfor significant accountingestimatesand judgmentsadopted in thepreparationof theseunconsolidatedcondensed interim
financialstatementsarethesameasthoseappliedin thepreparationof theannualfinancialstatementsof theBankfor theyearended
December 31, 2011.
Repurchase agreement lendings
---------- (Rupees in '000) ----------
March 31, 2012
December 31, 2011
Total
8.3
9 A DVAN CES - NETMarch 31, December 31,
2012 2011
Loans, cash credits, running finances, etc
- In Pakistan 229,558,248
223,963,444
- Outside Pakistan 10,686,204
10,959,873
240,244,452
234,923,317 Net Investment in finance lease
- In Pakistan 1,214,765
1,226,014
- Outside Pakistan 220,928
151,463
1,435,693
1,377,477Bills discounted and purchased (excluding treasury bills)
- Payable in Pakistan 861,262
722,522
- Payable outside Pakistan 10,245,156
11,111,385
11,106,418
11,833,907
Advances - gross 252,786,563
248,134,701
Less: Provision against loans and advances
- Specific provision 9.1 (21,868,395)
- General provision (252,787)
- General provision against consumer loans (188,441)
- General Provision for potential lease losses (in Srilanka operations) (20,158)
(22,329,781)
(21,869,401
(248,135
(198,340
(17,566
(22,333,442
Advances - net of provision 230,456,782 225,801,259
9.1
Other Assets Especially
Mentioned (OAEM) 9.1.1 10,605
-
10,605
-
-
Substandard 2,007,885
-
2,007,885
439,221
439,221
Doubtful 358,140
3,324
361,464
178,247
178,247
Loss 19,600,150
4,290,188
23,890,338
21,250,927
21,250,927
21,976,780
4,293,512
26,270,292
21,868,395
21,868,395
Other Assets Especially
Mentioned (OAEM) 9.1.1 - - - - -
Substandard 2,036,968 7,857 2,044,825 461,374 461,37
Doubtful 292,466 - 292,466 115,289 115,28
Specific
Provision
HeldDomestic
------------------------------------- Rupees in '000 ------------------------------------
Classified Advances
Category of Classification
Domestic
Total
Overseas
Investmentof theBankin AdamjeeInsuranceCompanyLimited iscarriedat costamountingto Rs.943.600million (December 3
2011:Rs. 943.600 million)as at March 31, 2012in accordance withthe treatmentspecifiedin InternationalAccountingStandar
(IAS) 28 "Accounting for Investments in Associates". The market value of the investment in Adamjee Insurance Company Limite
as at March 31, 2012 amounted to Rs. 2,039.867 million (December 31, 2011: Rs. 1,675.927 million).
Category of Classification
Specific
Provision
Required
March 31, 2012
---------- (Rupees in '000) ---------
December 31, 2011
------------------------------------- Rupees in '000 ------------------------------------
Specific
Provision
Held
Classified Advances
Total
Specific
Provision
Required
Overseas
Advances includeRs. 26,270.292million(December 31,2011:Rs. 26,664.873million)whichhave beenplacedundernon-performi
status as detailed below:
Loss 20,061,976 4,265,606 24,327,582 21,292,738 21,292,73
22,391,410 4,273,463 26,664,873 21,869,401 21,869,40
9.1.1 This represents non-performingportfolioof agriculturalfinancing classifiedas OAEM as per the requirements of the Prudenti
Regulation for Agricultural Financing issued by the SBP.
---------- (Rupees in '000) ----------
---------- (Rupees in '000) ----------
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MCBMCB Bank Limited
Notes to the Unconsolidated Condensed Interim Financial Statements (Un-audited)For the three months period ended March 31, 2012
MCMCB Bank Limited
Notes to the Unconsolidated Condensed Interim Financial Statements (Un-auditeFor the three months period ended March 31, 2012
13 First Quarterly Report, 2012 First Quarterly Report, 2012
10 BORR OW INGS March 31, December 31,
2012 2011
In Pakistan 26,737,202 37,397,843
Outside Pakistan 1,807,415 1,702,784
28,544,617 39,100,627
10.1 Details of borrowings (secured / unsecured)
Secured
Borrowings from State Bank of Pakistan
Export refinance scheme 9,926,134
9,903,657
Long term financing facility 1,511,310
2,026,175
Long term financing - export oriented projects scheme 1,310,028
949,375
Financing Facility for Storage of Agricultural Produce 460,799
219,932
Scheme for Revival of SMEs & Agricultural Activities in Flood Affected Areas -
450
13,208,271
13,099,589
Borrowings from other financial institutions 13,362
293,113
Repurchase agreement borrowings 13,591,017
24,781,254
13,604,379
25,074,367
26,812,650
38,173,956Unsecured
Call borrowings 991,480
816,139
Overdrawn nostro accounts 740,487
110,532
1,731,967
926,671
28,544,617
39,100,627
11 DEPOSITS AND OTHER ACCOUNTSCustomers
Fixed deposits 90,839,753
91,501,846
Savings deposits 244,609,624
225,920,953
Current accounts 166,504,701
161,680,596
Margin accounts 3,067,361
3,511,830
505,021,439
482,615,225
Financial institutions
Remunerative deposits 4,911,666
6,319,827
Non-remunerative deposits 2,133,956
2,253,658
7,045,622
8,573,485
512,067,061
491,188,710
12 DEFERRED TAX LIABILITY / (ASSET) - NET
The details of the tax effect of taxable and deductible temporary differences are as follows:
Taxable temporary differences on:
Surplus on revaluation of operating fixed assets 778,160
782,977
Accelerated tax depreciation 972,090 1,033,028
Receivable from pension fund 5,261,164 5,156,165Surplus on revaluation of securities 50,378 49,393
7,061,792 7,021,563Deductible temporary differences on:
Provision for bad debts (228,171)
Provision for contributory benevolent scheme (1,080)
Provision for post retirement medical benefits (294,055)
---------- (Rupees in '000) ----------
(523,306)
6,538,486
(414,114)
(5,655)
(306,908)
(726,677)
6,294,886
12.1
March 31, December 3
2012 2011
13 CONTINGENCIES AND COMMITMENTS13.1 Direct credit substitutes
Contingent liabilities in respect of guarantees given favouring
- Government 4,369,412
2,634,
- Banks and financial institutions 2,744,964
2,519,
- Others 5,022,186
4,885,
12,136,562
10,03913.2 Transaction-related contingent liabilities
Guarantees in favour of:
- Government 1,001,775
2,761,
- Others 4,982,788
4,217,
Suppliers credit / payee guarantee 2,457,093
2,373,
8,441,656
9,351,
13.3 Trade-related contingent liabilities 63,830,600
77,075
13.4 Other contingencies
Claims against the Bank not acknowledged as debts 818,363
844,
13.5 Commitments to extend credit
13.6 Commitments in respect of forward foreign exchange contracts
Purchase 26,888,166
32,395
Sale 26,658,002
35,030
13.7 Commitments for the acquisition of fixed assets 191,335
276,
13.8 Taxation
March 31, March 31
2012 2011
14 BASIC AND DILUTED EARNINGS PER SHARE - AFTER TAX
Profit after taxation 5,644,141 5,023,
Number of shares
Weighted average number of shares outstanding during the period 919,860,123 919,860
Rupees
Basic and diluted Earnings per share - after tax 6.14 5
15 CREDIT RATING
---------- (Rupees in '000) ------
TheFinanceAct, 2009and 2010have madesignificant amendmentsin theSeventh Scheduleto IncomeTaxOrdinance,2001.
deductionfor provisionfor doubtfuland losscategoriesof advancesandoff balancesheetitems isallowableupto a maximumof
of total advances whereas provisions for advances andoff-balancesheet items for consumer and small and medium enterpr
(SMEs)("as defined under theSBP'sPrudential Regulations") is nowallowed at 5% of total consumer andSME portfolio.
amountof baddebtsclassifiedas substandardunderPrudentialRegulationsissuedby StateBankof Pakistanwouldnot beallowean expense.
PACRA throughitsnotificationinJune 2011,has assignedlongtermcreditratingof AA+ [doubleA plus]andshort-termcreditra
of A1+ [A one plus] to the Bank.
---- (Rupees in '000) ----
TheBankmakescommitmentstoextend creditin thenormalcourse of itsbusinessbut these being revocablecommitmentsdo
attract any significant penalty or expense if the facility is unilaterally withdrawn.
Three months ended
The income tax assessments of the Bankhave been framed uptoand including the Tax Year 2011. For theAssessm
Year 1988-89 through Tax Year 2011, the department has amended the assessments on certain issues against the Ba
The Bank has filed appealswhich are pending at various appellateforums. in addition,certain decision made in favou
the Bank are being contested by the department at higher forums. No provision has been made in the finan
statements as themanagementandthe Bank's legalcounsel are of the viewthat theissues will be decidedin the Ba
favour as and when these are taken up by the Appellate Authorities.
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MCBMCB Bank Limited
Notes to the Unconsolidated Condensed Interim Financial Statements (Un-audited)For the three months period ended March 31, 2012
MCMCB Bank Limited
Notes to the Unconsolidated Condensed Interim Financial Statements (Un-auditedFor the three months period ended March 31, 2012
15 First Quarterly Report, 2012 First Quarterly Report, 2012
16 SEGMENT DETAILS WITH RESPECT TO BUSINESS ACTIVITIES
The segment analysis with respect to business activity is as follows:
Total income 28,479 10,357,788 3,655,716 5,916,722 19,958,705
Total expenses (5,935)
(1,773,834)
(8,542,758)
(979,945)
(11,302,472)
Income tax expense -
-
-
-
(3,012,092)
Net income 22,544
8,583,954
(4,887,042)
4,936,777
5,644,141
Segment assets - (Gross of NPLs Provisions) -
358,035,312
120,268,037
201,331,006
679,634,355
Ad va nc e ta xa tio n (p ayme nt le ss pro visio n) -
-
-
-
8,878,106
Total assets -
358,035,312
120,268,037
201,331,006
688,512,461
Segment non performing loans -
-
8,061,887
18,208,405
26,270,292
Segment specific provision required -
-
6,711,023
15,157,372
21,868,395
Segment liabilities -
21,189,519
515,896,953
30,588,334
567,674,806
Deferred tax liabilities - net 6,538,486
Total liabilities - net -
21,189,519
515,896,953
30,588,334
574,213,292
Segment return on assets (ROA) (%) 11.57% 12.88% 12.71% -
Segment cost of fund (%) 11.37% 4.44% 6.11% -
Total income 3,858
7,478,375
3,470,816
7,015,007
17,968,056
Total expenses (3,393)
(1,456,446)
(7,121,176)
(1,550,668)
(10,131,683)
Income tax expense -
-
-
-
(2,812,756)
Net income 465
6,021,929
(3,650,360)
5,464,339
5,023,617
S egme nt asse ts - (Gro ss of NP Ls pro visio n) -
274,667,774
112,698,621
233,524,193
620,890,588
Ad va nc e ta xa tio n (p ayme nt le ss pro visio n) -
-
-
-
3,782,057
Total assets -
274,667,774
112,698,621
233,524,193
624,672,645
Segment non performing loans -
-
6,700,062
18,193,854
24,893,916
Segment specific provision required -
-
5,376,326
14,599,279
19,975,605
Segment liabilities - 24,466,656 463,742,920 29,460,264 517,669,840
Deferred tax assets - - - - 5,121,195
Three months ended March 31, 2012
Three months ended March 31, 2011
Total
---------------------------------------------(Rupees i n '000)-----------------------------------------
Corporate
Finance
Trading
and
Sales
Retail &
Consumer
Banking
Commercial
Banking
Total liabilities - net - 24,466,656 463,742,920 29,460,264 522,791,035
Segment return on assets (ROA) (%) - 10.89% 12.94% 12.82% -
Segment cost of fund (%) - 11.39% 3.96% 5.64% -
17 RELATED PARTYTRANSACTIONS
Deposits
Depositsat be ginning of the period / year 4,398,756
2,088,985
766,387 955,014 77,043 24,677,392
Depositsre ceived during theperiod / year 1,100,134
20,407,581
30,536,355 169,261,154 986,420 250,452,445 8
Depositsre paid during theperiod / year (1,064,312)
(18,097,810)
(30,733,501) (169,449,781) (1,019,609) (249,736,033) (8
Depositsat the end of the period / year 4,434,578
4,398,756
569,241 766,387
43,854
312,093
(312,884)
43,063 43,854
25,393,804
74,117,220
(73,141,611)
26,369,413 25,393,804
50,178
190,356
(178,102)
62,432
Advances (secured)
Balance atbeginning of the period / year -
-
- - 449,729 112,548 81,302 - 49,743
Loan granted during the period / year -
-
- - 3,580 337,759 67,815 81,302 1,796
Repayment duringthe period / year -
-
- - - (578) (54,072) - (4,895)
Balance atend of the period / year -
-
- - 453,309 449,729 95,045 81,302 46,644
Outstanding Balance of credit card 713
1,137
- - - - - - 866
Receivablefrom Pension Fund -
-
- - - - 15,031,898 14,731,898 -
Adamjee Insurance CompanyLimited
Insurance premium paid-net of refund - - 202,676 - - - - - -
Insurance claim settled - - 17,863 8,443 - - - - -
Rent Income received - - 405 1,638 - - - - -
Outstanding commitments and contingent liabilities - - 8,365 8,365 - - - - -
Commission income from bancassurance - - 89,554 38,144 - - - - -
Adamjee Life Assurance CompanyLimited
Insurance Premium Paid - - 25,262 26,342 - - - - -
Outstanding commitments and contingent liabilities - - 500 500 - - - - -
Euronet Pakistan Private Limited
ATMOutsourcing Revenue --
29,258 5,607 - - - - -Capitalinjection - - - 52,519 - - - - -
Trade payable - - 4,292 7,317 - - - - -
Training expenses reimbursed - - - 27 - - - - -
The Bank has related partyrelationship with itsassociates, subsidiaries, employee benefit plans and its keymanagement personnel(inc luding their associates) and companies with common directors.
The Bank enters intotransactions with related parties in the normalcourse of business. Contributions toand accruals in respect ofstaff retirement benefits and other benefit plans are made in accordancewith the actuarial
valuations /terms of the contribution plan. Remuneration tothe executives / officers is determined in accordance with the terms of their appointment.
Three months
ended
March 31,
2012
Three months
ended
March 31,
2012
Associates
Associates
Details of transactions with related parties and balances with them as atthe period-end were as follows:
Subsidiary companies Key management per
Three months
ended
March 31,
2012
Yea
end
Dec
201
Keymanagement per
Year
ended
Dec 31,
2011
----------------------------------------------------------(Rupees in '000) --------------------------------------------------------------
Subsidiarycompanies
Year
ended
Dec 31,
2011
Three months
ended
March 31,
2012
OtherRelatedParties
Year
ended
Dec 31,
2011
Three months
ended
March 31,
2012
March 31,
2012
Directors OtherRelatedParties
Directors
March 31 /
December 31,
2011
March 31 /
December 31,
2011
Year
ended
Dec 31,
2011
----------------------------------------------------------(Rupees in '000) --------------------------------------------------------------
March 31,
2012
March 31,
2012
March 31,
2012
March 31 /
December 31,
2011
March 31,
2012
March 31 /
December 31,
2011
March
Decem
201
Mayban International Trust (Labuan) Berhad
Forward foreign exchange contracts (Notional) - - - - - - - 1,913,753 -
Unrealized loss on forward foreign exchange contracts - - - - - - - 40,914 -
MNET Services (Private) Limited
Dividend received - - - - - 4,998 - - -
Outsourcingservice expenses - - - - 15,283 16,115 - - -
Payment system managed service revenue (PSM) - - - - - 6,449 - - -
Payable for trade debts - - - - 20,814 16,506 - - -
Receivable for other expenses - - - - - 3,490 - - -
"MCB Leasing" ClosedJoint Stock Company
Markup Receivable - - - - 2,960 4,265 - - -
MCB TradeServices Limited
Dividend received - - - - - 4,664 - - -
Arif HabibInvestments Limited
Dividend received - - - - 27,718 29,998 - - -
Markup payable - - - - 193 610 - - -
Commission Receivable - - - - 12,744 1,924 - - -
Commission on distribution of unitsand managementfee sharing
- - - - 10,391 15,762 - - -
MCB Employees Foundation
Serviceexpenses - - - - - - 4,594 4,378 -
Cash sorting expenses - - - - - - 8,966 10,889 -
StationeryExpenses - - - - - - 40,095 31,484 -
Advance receivable - - - - - - 20,000 20,000 -
Payable for stationeryexpenses - - - - - - 6,834 1,255 -
MCB Employees SecuritySystem
andServices (Private) Limited
Securityguard expenses - - - - - - 63,507 47,384 -
Remuneration and non-executivedirectors' fee 16,134 15,302 - - - - - - 46,828
Mark-up expense on deposits 89,899 21,785 20,410 16,535 1,056 723 995,318 1,058,302 1,059
Markup income on advances - - - - 4,739 1,264 2,346 - 888
Clearingexpenses paid toNIFT - - - - - - 29,268 30,065 -
Other miscellaneous expenses - - - - - - 3,195 3,924 -
Investment in Metro-Bank Pakistan Sovereign Fund-Perpetual - - - - - - 4,000,000 4,000,000 -
Dividend Income - - - - - - 216,893 - -
Contribution toprovident fund - - - - - - 43,941 39,703 -
Commission Received - - 919 - - - 13 - -
Gas charges - - - - - - 3,115 2,239 -
Rent Paid - - - - - - 53 42 -
The chairman has been provided with free use ofthe Bank maintained car.The ChiefExecutive and certain executives are provided with free use ofthe Bank's maintained cars and household equipment in accordance with the termsoftheir emp
Others
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MCMCB Bank Limited
Notes to the Unconsolidated Condensed Interim Financial Statements (Un-auditeFor the three months period ended March 31, 2012
MCBMCB Bank Limited
Notes to the Unconsolidated Condensed Interim Financial Statements (Un-audited)For the three months period ended March 31, 2012
17 First Quarterly Report, 2012 First Quarterly Report, 2012
18 ISLAMIC BANKING BUSINESS
March 31, December 31,
2012 2011
Assets
Cash and balances with treasury banks 278,465
334,398
Investments - net 2,818,271
2,938,706
Financing and receivables- Murabaha 4,490,409
4,094,212
- Ijara 95,899
96,146
- Islamic export refinance 1,189,248
1,420,784
Fixed Assets 996,394
1,008,864
Deferred tax assets 720
-
Other assets 3,059,821
3,330,885
12,929,227
13,223,995
Liabilities
Bills payable 108,607
45,297
Deposits and other accounts - - - Current accounts 813,666
1,022,119
- Saving accounts 1,578,387
1,636,924
- Term deposits 3,259,045
4,565,234
- Others 13,759
81,503
Borrowing from SBP 1,391,682
1,664,996
Due to head office 4,367,708
2,558,624
Deferred tax liability -
8,182
Other liabilities 372,270
449,518
11,905,124
12,032,397
Net assets 1,024,103
1,191,598
Represented by:
Islamic Banking Fund 1,000,000
1,000,000
Other Reserves (124)
70
Unappropriated profit 25,564
176,334
1,025,440
1,176,404
Surplus / (deficit) on revaluation of assets - net of tax (1,337)
15,194
1,024,103
1,191,598
CHARITY FUND
Opening balance 782 1,763
Additions during the year
Received from customers on delayed payments 829 1,397
Profit on charity saving account 14 122
843 1,519
---------- (Rupees in '000) ----------
The Bank is operating 23 Islamic banking branches including 1 overseas branch (December 31, 2011: 23 branches including 1
overseas). The statement of financial position of the Bank's Islamic Banking Branches as at March 31, 2012 is as follows:
Payments / utilization during the year
Social Welfare - (1,500)
Health - (1,000)
Education - -
Relief and disaster recovery -
- (2,500)
Closing balance 1,625 782
Quarter ended Quarter ended
March 31,
2012
March 31,
2011
Income / return / profit earned 349,420
380,68
Income / return / profit expensed 278,248
266,91
Net Income / Profit 71,172
113,770
Provision against loans and advances - net (130)
9,29
Provision for diminution in the value of investments -
-
Bad debts written off directly -
-
(130)
9,29
Net profit / income after provisions 71,302
104,48
Other income
Fees, commission and brokerage income 8,904
13,723
Dividend income -
Income from dealing in foreign currencies 2,342
412
Other Income 30,406
5,46
Total other income 41,652
19,602
112,954
124,08
Other expenses
Administrative expenses 87,045 65,895
Other provisions / write offs -
-
Other charges (Penalty paid to SBP) 344
237
Total other expenses 87,389
66,132
Extra ordinary / unusual items -
-
Profit before taxation 25,565
57,950
Remuneration to Shariah Advisor / Board 486
420
1 9 GENERAL
- Figures have been rounded off to the nearest thousand of rupees unless otherwise stated.
-
20 NON-ADJUSTING EVENT
21 DATE OF AUTHORIZATION FOR ISSUE
Comparative information has been reclassified and rearranged in these unconsolidated condensed interim financial statements for
purpose of comparison.
Theprofitandlossaccountof theBank'sIslamicbankingbusinessfor thethree monthsperiod ended March 31, 2012 isa
follows:
---------- (Rupees in '000) ---------
TheBoardof Directorsin itsmeetingheldon April24,2012hasannouncedcashdividendinrespectof thethreemonthsperiodende
March 31,2012 of Rs.3.00per share (March 31,2011: Rs.3.00per share). These unconsolidated condensed interim financi
statements for the three months period ended March 31,2012 do not include the effect of these appropriations which will b
accounted for subsequent to the period end.
Theseunconsolidatedcondensedinterimfinancialstatementswereauthorizedfor issuebythe Board of Directorsof theBankin the
meeting held on April 24, 2012 .
Sarmad Amin
Director
S.M. Muneer
President / CEOM.U.A. Usmani Mian Umer Mansha
-
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MCBMCB Bank Limited
19
(Consolidated Financial Statements of MCB Bank Limited and its Subsidiary Companies)
First Quarterly Report, 2012
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MCBMCB Bank Limited & Subsidiary Companies
Consolidated Condensed Interim Profit and Loss Account (Un-audited)For the three months period ended March 31, 2012
MCMCB Bank Limited & Subsidiary Companies
21
Consolidated Condensed Interim Statement of Financial Position (Un-audited)As at March 31, 2012
First Quarterly Report, 2012 First Quarterly Report, 2012
Unaudited Audited
Note March 31, December 31,
2012 2011
Assets
Cash and balances with treasury banks 46,915,598
53,122,620
Balances with other banks 2,542,298
2,357,418
Lendings to financial institutions 7 2,819,768
955,087
Investments - net 8 330,522,492
319,005,983
Advances - net 9 230,442,850
225,794,738
Operating fixed assets 22,775,547
22,418,450
Deferred tax assets - net -
-
Other assets - net 34,242,301
32,670,511
670,260,854
656,324,807
Liabilities
Bills payable 8,404,870
9,466,818
Borrowings 10 28,544,617
39,100,627
Deposits and other accounts 11 512,027,617 491,146,798
Sub-ordinated loan - - Liabilities against assets subject to finance lease - - Deferred tax liabilities - net 12 6,760,596
6,497,097
Other liabilities 18,731,596
18,459,162
574,469,296
564,670,502
Net assets 95,791,558
91,654,305
Represented by:
Share capital 9,198,601
8,362,365
Reserves 42,732,393
42,412,588
Un-appropriated profit 32,107,021
30,259,449
84,038,015
81,034,402
Minority interest 486,006
492,497
84,524,021
81,526,899
Surplus on revaluation of assets - net of tax 11,267,537
10,127,406
95,791,558
91,654,305
Contingencies and commitments 13
---------- (Rupees in '000) ----------
The annexed notes 1 to 21 form an integral part of these consolidated condensed interim financial statements.
Note
Mark-up / return / interest earned 17,560,674 15,969,9
Mark-up / return / interest expensed 6,846,237 5,036,9
Net mark-up / interest income 10,714,437 10,932,9
Provision against loans and advances - net 74,532 1,002,3
Provision for diminution in the value of investments - net591 187,1
Bad debts written off directly 120 7,39
75,243 1,196,8
Net mark-up / interest income after provisions 10,639,194 9,736,0
Non mark-up / interest income
Fee, commission and brokerage income 1,463,841 1,182,9
Income earned as trustee to various funds 4,787 5,52
Dividend income 477,399 149,0
Income from dealing in foreign currencies 255,519 214,8
Gain on sale of securities - net 43,922 256,7
Unrealized gain on revaluation of investments classified as held for trading 23,473 32,9
Other income 240,102 203,8
Total non mark-up / interest income 2,509,043 2,045,9
13,148,237 11,782,0Non-mark-up / interest expenses
Administrative expenses 4,205,129 3,722,5
Other provisions / (reversals) 15,775 (13,76
Other charges 241,136 243,4
Total non mark-up/interest expenses 4,462,040 3,952,2
Share of profit of associates 130,309 139,4
Extra ordinary / unusual item - -
Profit before taxation 8,816,506
7,969,2
Taxation - current period 2,779,174 2,716,7
- prior years - -
- deferred 262,828 116,9
Share of tax of associates 6,880 22,9
3,048,882 2,856,7
Profit after taxation 5,767,624 5,112,5
(Profit) / Loss attributable to minority interest(19,709) 35
Profit attributable to ordinary share holders 5,747,915 5,112,890
Earnings per share - basic and diluted - Rupees 14 6.25 5.5
The annexed notes 1 to 21 form an integral part of these consolidated condensed interim financial statements.
Quarter end
March 31
2011
Quarter ended
March 31,
2012
---------- (Rupees in '000) -------
Sarmad Amin
Director
S.M. Muneer
President / CEOM.U.A. Usmani Mian Umer ManshaSarmad Amin
Director
S.M. Muneer
President / CEOM.U.A. Usmani Mian Umer Mansha
7/31/2019 MCB First Quarter Result 2012
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MCMCB Bank Limited & Subsidiary Companies
Consolidated Condensed Interim Cash Flow Statement (Un-audited)For the three months period ended March 31, 2012
MCBMCB Bank Limited & Subsidiary Companies
Consolidated Condensed Interim Statement of Comprehensive Income (Un-audited)For the three months period ended March 31, 2012
23 First Quarterly Report, 2012 First Quarterly Report, 2012
Profit after tax for the period 5,767,624 5,112,533
Other comprehensive income
Effect of translation of net investment in foreign branches and subsidiaries
- Equity shareholders of the Bank (244,609)
4,719
- Minority interest 17 8
(244,592) 4,727
Comprehensive income transferred to equity 5,523,032
5,117,260
Components of comprehensive income not reflected in equity
Net change in fair value of available for sale securities 738,786
34,146
Deferred tax (985)
(80,094)
737,801
(45,948)
Total comprehensive income for the period 6,260,833 5,071,312
The annexed notes 1 to 21 form an integral part of these consolidated condensed interim financial statements.
Quarter ended
March 31,
2012
Quarter ended
March 31,
2011
March 31, March 31,
2012 2011
Cash flows from operating activities
Profit before taxation 8,816,506 7,969,24
Less: Dividend income & share of profit of associates (607,708) (288,504
8,208,798 7,680,74Adjustments for non-cash charges
Depreciation 312,693
265,91
Amortization 62,391
47,025
Provision against loans and advances - net 74,532
1,002,30
Provision for diminution in the value of investments - net 591
187,177
Other provisions / (reversals) 15,775
(13,763
Bad debts written off directly 120
7,394
Unrealized gain on revaluation of investments classified as held for trading (23,473)
(32,945
Gain on disposal of fixed assets (4,298)
(3,798
438,331
1,459,31
8,647,129
9,140,05(Increase) / decrease in operating assets
Lendings to financial institutions (1,864,681)
3,376,78
Net investment in held for trading securities (5,176,473)
21,693
Advances - net (4,722,764)
(5,511,27
Other assets - net 1,528,284
(230,05
(10,235,634)
(2,342,85
Increase / (decrease) in ope rating liabilities
Bills payable (1,061,948) (638,93
Borrowings (10,556,010)
3,985,76
Deposits and other accounts 20,880,819
30,959,44
Other liabilities (1,902,119)
(2,037,80
7,360,742
32,268,47
5,772,237
39,065,67
Income tax paid (5,657,426)
(3,969,23
Net cash flows from operating activities 114,811
35,096,43
Cash flows from investing activities
Net investments in available-for-sale securities (6,631,753)
(37,400,10
Net investments in held-to-maturity securities 1,588,228
118,59
Investment in associated undertaking -
(52,52
Dividend income received 239,485
78,036
Investment in operating fixed assets - net of disposals (727,883)
(761,91
Net cash flows from investing activities (5,531,923)
(38,017,90
Cash flows from financing activities
Dividend paid (360,438)
(258,574
Net cash flows from financing activities (360,438) (258,574
Exchange difference on translation of net investment in foreign branches and subsidiaries (244,592) 4,727
Increase in cash and cash equivalents (6,022,142) (3,175,31
Cash and cash equivalents at January 1 55,480,038 46,958,78
Cash and cash equivalents at March 31 49,457,896 43,783,46
The annexed notes 1 to 21 form an integral part of these consolidated condensed interim financial statements.
---------- (Rupees in '000) -------
Sarmad Amin
Director
S.M. Muneer
President / CEOM.U.A. Usmani Mian Umer ManshaSarmad Amin
Director
S.M. Muneer
President / CEOM.U.A. Usmani Mian Umer Mansha
---------- (Rupees in '000) ----------
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Notes to the Consolidated Condensed Interim Financial Statements (Un-audited)For the three months period ended March 31, 2012
MCMCB Bank Limited & Subsidiary CompaniesMCBMCB Bank Limited & Subsidiary Companies
Consolidated Condensed Interim Statement of Changes in Equity (Un-audited)For the three months period ended March 31, 2012
25 First Quarterly Report, 2012 First Quarterly Report, 2012
Balance asat December 31, 2010 7,602,150 - 9,702,528 347,599 11,514,399 18,600,000 23,458,429 71,225,105 2,698 71,227,803
Change inequity for three months endedMarch 31, 2011
Profit after taxation for threemonths period
ended March 31, 2011 -
-
-
-
-
-
5,112,533
5,112,533
- 5,112,533
Profit attributableto minorityinterest -
-
-
-
-
-
357
357
(357) -
Profit after taxation for thethree monthsen ded March 31, 2011
a tt ri bu ta ble t oo rd in ar ys ha re ho ld er s of th e gr ou p -
-
-
-
-
-
5,112,890
5,112,890
( 35 7) 5 ,1 12 ,5 33
Exchange differenceson translation ofnet
investmentin foreign branchesand subsidiaries -
-
-
4,719
-
-
-
4,719
8 4,727
Total comprehensivein comefor thethreemon thsperiod ended
March 31, 2011 -
-
-
4,719
-
-
5,112,890
5,117,609
( 34 9) 5 ,1 17 ,2 60
Transferred from surpluson revaluation offixed
assets tounappropriated profit - net oftax -
-
-
-
-
-
9,071
9,071
- 9,071
Shareof dividend attributableto minorityshareholders -
-
-
-
-
-
-
(4) (4)
Transferred tostatutory reserve -
-
-
-
502,362
-
(502,362)
-
- -
Transfer toreserve for issueof bonus shares -
760,215
-
-
-
-
(760,215)
-
- -
Final cash dividend - December 2010 -
-
-
-
-
-
(2,280,645)
(2,280,645)
- (2,280,645)
Balance asat March31, 2011 7,602,150
760,215
9,702,528
352,318
12,016,761
18,600,000
25,037,168
74,071,140
2 ,3 45 7 4, 07 3 ,4 8 5
Profit after taxation for theyear ended
December 31, 2011 -
-
-
-
-
-
14,189,950
14,189,950
- 14,189 ,95 0
Profit attributable to minority interest -
-
-
-
-
-
(28,524)
(28,524)
28,524 -
Profitafter taxation for thenine monthsended December 31, 2011
a tt ri bu ta ble t oo rd in ar ys ha re ho ld er s of th e gr ou p - - - - - - 14,161,426 14,161,426 28,524 14,189,950
Exchange differenceson translation ofnet
investmentin foreign branchesand subsidiaries - - - 78,942 - - - 78,942 134 79,076
Total comprehensivein comefor the ninemonth s
ended December 31, 2011 - - - 78,942 - - 14,161,426 14,240,368 28,658 14,269,026
Transferred from surpluson revaluation offixed
assets tounappropriated profit - net oftax - - - - - - 27,111 27,111 128 27,239
Transferred tostatutory reserve -
-
-
-
1,440,129
-
(1,440,129)
-
- -
Issueofbonusshares- December 2010 760,215
(760,215)
-
-
-
-
-
-
- -
Adjustmentspertaining to additional issueof sharecapital to minority
interest on amalgamation ofMCBAssets Management Company
Limited with Arif Habib Investments Limited -
-
221,910
-
-
-
-
221,910
5 13 ,9 47 7 35 ,8 57
Shareof dividend attributableto minorityinterest -
-
-
-
-
-
-
-
( 52 ,5 81 ) ( 52 ,5 81 )
Interim cash dividend - March 2010 -
-
-
-
-
-
(2,508,709)
(2,508,709)
- (2,508,709)
Interim cash dividend - June2010 -
-
-
-
-
-
(2,508,709)
(2,508,709)
- (2,508,709)
Interim cash dividend - September 2010 -
-
-
-
-
-
(2,508,709)
(2,508,709)
- (2,508,709)
Balance asat December 31, 2011 8,362,365
-
9,924,438
431,260
13,456,890
18,600,000
30,259,449
81,034,402
492, 497 81,526,899
Profitafter taxation for thethree monthsperiod ended
March 31, 2012 -
-
-
-
-
-
5,767,624
5,767,624
- 5,767,624
Profit attributableto minorityinterest -
-
-
-
-
-
(19,709)
(19,709)
19,709 -
Profitafter taxation for thethree monthsperiod ended
March 31, 2012attributable toordinary shareholdersof thegroup -
-
-
-
-
-
5,747,915
5,747,915
1 9, 70 9 5 ,7 67 ,6 2 4
Exchange differenceson translation ofnet
investmentin foreign branchesand subsidiaries -
-
-
(244,609)
-
-
-
(244,609)
1 7 ( 24 4, 59 2)
Total comprehensivein comefor thethree months period
ended March 31, 2012 -
-
-
(244,609)
-
-
5,747,915
5,503,306
1 9, 72 6 5 ,5 23 ,0 3 2
Transferred from surpluson revaluation offixed
assets tounappropriated profit - net oftax -
-
-
-
-
-
9,016
9,016
65 9,081
Transferred tostatutory reserve -
-
-
-
564,414
-
(564,414)
-
- -
Transfer toreserve for issueof bonus shares - 836,236 - - - - (836,236) - - -
Issueofbonusshares- December 2011 836,236 (836,236) - - - - - - - -
Shareof dividend attributableto minorityinterest - - - - - - - - (26,282) ( 26,282)
Final cash dividend - December 2011 - - - - - - (2,508,709) (2,508,709) - (2,508,709)
Balance as at March31, 2012 9,198,601 - 9,924,438 186,651 14,021,304 18,600,000 32,107,021 84,038,015 486,006 84,524,021
Thean nexed notes1 to 21 form an integral part ofthese consolidated condensed interim financial statements.
---------------------------------------------------------- (Rupees in'000) ----------------------------------------------------------
Share
capital
Capital reserves Revenue Reserves
SubtotalMinority
InterestTotalReservefor issue
ofbonus sharesSharepremium
Exchange
translation
reserve
Statutory reserve GeneralreserveUnappropriated
profit
3 STATEMENT OF COMPLIANCE
3.1 These consolidatedcondensedinterimfinancialstatements havebeen preparedin accordancewith approvedaccountingstandard
applicablein Pakistan.ApprovedAccountingStandardscompriseof suchInternationalFinancialReportingStandards(IFRS)iss
by the International Accounting Standards Board (IASB) as are notified under the Companies Ordinance, 1984, provisions of
directivesissuedunder theBankingCompanies Ordinance,1962,the CompaniesOrdinance,1984,and thedirectives issuedby S
In caserequirementsdiffer,the provisionsof anddirectivesissued underthe Banking CompaniesOrdinance, 1962,the Compa
Ordinance, 1984, and the directives issued by SBP shall prevail.
1 STATUS AND NATURE OF BUSINESS
2 BASIS OF PRESENTATION
2.1
2.2
2.3
a)
b)
c)
The Group consists of:
Holding Company
- MCB Bank Limited
"Percentage holding of
MCB Bank Limited"Subsidiary Companies
- MCB Financial Services Limited 99.99%
- MNET Services (Private) Limited 99.95%
- MCB Trade Services Limited 100%- Arif Habib Investments Limited 51.329%
- "MCB Leasing" Closed' Joint Stock Company 95.00%
Theconsolidatedcondensedfinancialstatementsincludethefinancialstatementsof MCBBankLimitedandits subsidiarycompa
and associates.
Subsidiariesare all entities over which theGrouphas thepower to govern thefinancial andoperating policies accompanyin
shareholding of more than one half of the voting rights. Theexistenceand effect of potential voting rights that are curre
exercisableare consideredwhen assessingwhether the Groupcontrolsanother entity. Subsidiaries are fullyconsolidated from
date on which control is transferred to theGroup. They arede-consolidated from the date when control ceases. Theassets
liabilitiesof subsidiarycompanieshave beenconsolidatedon a lineby linebasisbased onthe unauditedfinancialstatementsfor
period ended March 31, 2012 and the carrying value of investments held by the Group is eliminated against the subsidia
shareholders' equity in these consolidated condensed interim financial statements. Material intra-Group balances and transactions h
been eliminated.
Associatesare entities over whichthe Grouphas significantinfluencebut not control.Investments in associatesare accounted
under theequity method of accountingand areinitiallyrecognised at cost,thereafter adjustedfor thepost-acquisition change in
Group'sshare of net assetsof theassociate.Thecumulativepost-acquisitionmovementsare adjusted in thecarryingamount of
investment.Accountingpoliciesof theassociate havebeenchangedwherenecessary toensureconsistencywith thepoliciesadop
by the Group. The Group's share in associate has been accounted for based on the financial statements for the period ended Ma
31, 2012.
Minorityinterestare thatpart of thenet resultsof operationsandof netassetsof subsidiarycompaniesattributableto interestswh
are not owned by the Group.
MCBBank Limited ('theBank')is a banking company incorporated in Pakistan and is engaged in commercialbankingand rel
services. TheBank's ordinary shares are listed on all the stock exchanges in Pakistan whereas its Global Depositary Rece
(GDRs)(representingtwo ordinary equityshares)are tradedon theInternational Order Book (IOB) systemof theLondon S
Exchange.TheBank's registeredofficeand principalofficeare situated at MCBBuilding,JinnahAvenue, Islamabadand MCB
Main,Gulberg,Lahore,respectively.The Bankoperates1,165branchesincluding22 Islamicbanking branches(December 31,20
1,165branchesincluding22 Islamicbanking branches)with in Pakistan and8 (December31, 2011:8) branchesoutsidethe cou
(including the Karachi Export Processing Zone Branch).
Inaccordancewith thedirectivesof theFederalGovernmentregardingtheshiftingof thebankingsystemto Islamicmodes,the S
Bank of Pakistan hasissued various circularsfrom timeto time. Permissible forms of trade-related modes of financinginc
purchaseof goods by banks from their customers and immediate resale to them at appropriatemark-up in price on deferred paym
basis. The purchases and sales arising under these arrangements are not reflected in these consolidated condensed interim finan
statements as such but are restricted t o the amount of facility actually utilized and the appropriate portion of mark-up thereon.
Thefinancial results of theIslamic banking branches have been consolidated in these consolidated condensed interim finan
statementsfor reportingpurposes,after eliminatingmaterialintrabranchtransactions/ balances.Key financialfiguresof theIsla
banking branches are disclosed in note 18 to these consolidated condensed interim financial statements.
Sarmad Amin
Director
S.M. Muneer
President / CEOM.U.A. Usmani Mian Umer Mansha
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Notes to the Consolidated Condensed Interim Financial Statements (Un-audited)For the three months period ended March 31, 2012
MCBMCB Bank Limited & Subsidiary Companies
Notes to the Consolidated Condensed Interim Financial Statements (Un-audited)For the three months period ended March 31, 2012
MCMCB Bank Limited & Subsidiary Companies
27 First Quarterly Report, 2012 First Quarterly Report, 2012
3.2
3.3
4 BASIS O F MEASUREMENT
4.1
4.2
5 SIGNIFICANT ACCOUNTING POLICIES AND RISK MANAGEMENT
5.1
5.2
6
7. LENDINGS TO FINANCIAL INSTITUTIONS March 31, December 31,
2012 2011
-
-
2,819,768 955,087
2,819,768 955,087
8 I NV ES TM EN TS - N ET
8.1 Investments by types
Held-for-trading securities 5,538,691
-
5,538,691
Available-for-sale securities 8.2 301,982,653
13,548,342
315,530,995
Held-to-maturity securities 8.2 7,304,613 62,087 7,366,700
314,825, 957 13,610,429 328,436,386
Adamjee Insurance Company Limited 8.3 3,614,503 - 3,614,503
Euronet Pakistan (Private) Limited 8.4 53,413 - 53,413
First Women Bank Limited 8.5 63,300 - 63,300
These consolidated condensed interim financial statements have been prepared under the historical cost convention except that certain
fixed assetsare s tated at revalued amounts , certain investments, commitments in respect of certain forward foreign exchange
contracts and derivative financial instruments have been marked to market and are carried at fair value.
Theaccountingpolicesadoptedin thepreparation of these consolidatedcondensedinterim financialstatementsarethe sameasthose
applied in the preparation of the annual financial statements of the Bank for the year ended December 31, 2011.
The basis for significant accounting estimatesand judgmentsadopted in thepreparation of these consolidatedcondensedinterim
financialstatementsare thesameasthoseappliedinthe preparationof theannualfinancialstatementsof theGroupfortheyear ended
December 31, 2011.
Repurchase agreement lendings
---------- (Rupees in '000) ----------
March 31, 2012
TotalHeld by
bank
Thefinancial risk managementobjectivesand policiesare consistent withthosedisclosed in theannualfinancial statements of the
Group for the year ended December 31, 2011.
SIGNIFICANT ACCOUNTING ESTIMATES AND JUDGMENTS
The State Bank of Pakistanhas deferred theapplicabilityof InternationalAccounting Standard (IAS) 39,'Financial Instruments:
Recognitionand Measurement' and InternationalAccountingStandard (IAS) 40, 'Investment Property' for BankingCompanies
through BSDCircular No.10 datedAugust26, 2002.The Securities and ExchangeCommission of Pakistan(SECP)has deferred
applicabilityof IFRS-7"FinancialInstruments:Disclosures"on banksthrough S.R.O411(1)/2008 datedApril 28,2008. Accordingly,
therequirementsof these standardshavenot beenconsidered in thepreparation of these consolidatedcondensed interimfinancial
statements.However,investmentshavebeenclassifiedand valued inaccordancewith therequirementsprescribedby theStateBank
of Pakistan through various circulars.
Thedisclosuresmadein these consolidatedcondensed interimfinancialstatementshave,howeverbeen limitedbased on theformat
prescribed by the State Bank of Pakistan vide BSD Circular No. 2 dated May 12, 2004 and Internation al Accountin g Standard 34,
"Interim Financial Reporting". They do not include all of the disclosures required for annual f inancial s tatements and these
consolidatedcondensedinterimfinancialstatementsshouldbe readin conjunctionwith thefinancialstatementsof theGroupforthe
year ended December 31, 2011.
Given as
collateral
These consolidated condensed inter im financial s tatements are presented in Pak Rupees, which is the Bank's functional and
presentatio n currency .
Call money lendings
3,731,216 - 3,731,216
Investments at cost 318, 557,173 13,610, 429 332, 167,602
Less: Provision for diminution in the value of investments (2,918,252) - (2,918,252)
Investments (net of provisions) 315, 638,921 13,610, 429 329, 249,350
Surplus / (deficit) on revaluation of available for sale securities - net 1,256,255 (6,586) 1,249,669Gain on revaluation of held-for-trading securities - net 23,473 - 23,473
Investments at revalued amounts - net of provisions 316, 918,649 13,603, 843 330, 522,492
Held-for-trading securities 345,602 - 345,6
Available-for-sale securities 8.2 285, 002,260 24, 306,386 309,308,
Held-to-maturity securities 8.2 8,471,928 483,000 8,954,9
293, 819,790 24, 789,386 318,609,
Adamjee Insurance Company Limited 8.3 3,101,352
-
3,101,3
Euronet Pakistan (Private) Limited 8.4 53,917
-
53,9
First Women Bank Limited 8.5 63,300
-
63,3
3,218,569
-
3,218,5
Investments at cost 297,038,359
24,789,386
321,827,
Le ss : Pr ov is io n f or d im in ut io n i n t he v al ue of i nve st me nt s ( 3, 32 7, 065 )
-
(3,327,0
Investments (net of provisions) 293,711,294
24,789,386
318,500,
Surplus on revaluation of available for sale securiti es - net 475,204
13,483
488,6
Gain on revaluation of held-for-trading securities - net 16,616
-
16,6
Investments at revalued amounts - net of provisions 294,203,114
24,802,869
319,005,
8.2
8.3
March 31, December 312012 2011
Opening Balance 3,101,352
3,703,2
Share of profit / (loss) for the period / year before tax 130,707
(73,0
Dividend from associate -
(90,0
Share of tax (6,774)
71,2
123,933
(91,9
Share of unrealized surplus on assets -net of tax 389,218
(509,9
Closing Balance 3,614,503
3,101,3
8.4
March 31, December 31
2012 2011
Opening balance 53,917 -
Investment made during the year - 52,5
Investment in Adamjee Insurance Company Limited under equity method - holding 29.13%
December 31, 2011
Total
Investments include Pakistan Investment Bonds amountingto Rs. 232.600 million(December 31, 2011: Rs. 232.600 mil
earmarked by the State Bank of Pakistan andNationalBankof Pakistan against TT/ DD discountingfacilitiesand demandn
facilities sanctioned to the Bank. In addition, Pakistan Investment Bonds amounting to Rs. 5 million (December 31, 2011: Rs. 5 mil
have been pledged with the Controller of Military Accounts on the account of Regimental Fund Account.
Held by
bank
Investmentof the Groupin Adamjee Insurance CompanyLimitedhas been accountedfor underthe equitymethodof accountin
accordance with the treatment specified in International Accounting Standard 28, (IAS 28) 'Accounting for Investment
Associates'. The market valueof the investmentin Adamjee Insurance CompanyLimitedas at March 31,2012amountedto
2,039.867 million (December 31, 2011: Rs. 1,675.927 million).
Investment of the Group in Euronet Pakistan Private Limitedhas been accounted for under the equitymethod of accountin
accordance with the treatment specified in International Accounting Standard 28, (IAS 28) 'Accounting for Investment
Associates'.
Investment in Euronet Pakistan Private Limited under equity method - holding 30%
Given as
collateral
Share of profit / (loss) for the period / year before tax (398) 1,5
Share of tax (106) (1
(504) 1,3
Closing Balance 53,413 53,9
8.5 TheGroup's investmentin FirstWomen Bank Limitedis carriedat cost andhave notbeen accountedfor underequitymetho
accounting as the Group does not have significant influence over the entity.
---------- (Rupees in '000) ----------
---------- (Rupees in '000) -------
---------- (Rupees in '000) -------
---------- (Rupees in '000) ----------
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Notes to the Consolidated Condensed Interim Financial Statements (Un-audited)For the three months period ended March 31, 2012
MCBMCB Bank Limited & Subsidiary Companies
Notes to the Consolidated Condensed Interim Financial Statements (Un-audited)For the three months period ended March 31, 2012
MCMCB Bank Limited & Subsidiary Companies
31 First Quarterly Report, 2012 First Quarterly Report, 2012
12.1
March 31, December 31,
2012 2011
13 CONTINGENCIES AND COMMITMENTS
13.1 Direct credit substitutes
Contingent liabilities in respect of guarantees given favouring
- Government 4,369,412
2,634,218
- Banks and financial institutions 2,744,964
2,519,451
- Others 5,022,186
4,885,951
12,136,562
10,039,62013.2 Transaction-related contingent liabilities
Guarantees in favour of:
- Government 1,001,775
2,761,601
- Others 4,982,788
4,217,157
Suppliers credit / payee guarantee 2,457,093
2,373,006
8,441,656
9,351,764
13.3 Trade-related contingent liabilities 63,830,600
77,075,699
13.4 Other contingencies
Claims against the Bank not acknowledged as debts 818,363
844,099
13.5 Commitments to extend credit
13.6 Commitments in respect of forward foreign exchange contracts
Purchase 26,888,166
32,395,900
Sale 26,658,002
35,030,445
13.7 Commitments for the acquisition of fixed assets 191,335
276,277
13.8 Taxation
March 31, March 31,
2012 2011
14 BASIC AND DILUTED EARNINGS PER SHARE - AFTER TAX
Profit after taxation 5,747,915
5,112,890
Number of shares
Weighted average number of shares outstanding during the period 919,860,123 919,860,123
Rupees
Basic and diluted Earnings per share - after tax 6.25 5.56
15 CREDIT RATING
The Bankmakes commitmentstoextend credit inthe normalcourseof its businessbut these beingrevocablecommitmentsdo not
attract any significant penalty or expense if the facility is unilaterally withdrawn.
Three months ended
The income tax assessments of the Bank have beenframed upto and includingthe Tax Year 2011. For the Assessment
Year 1988-89 through Tax Year 2011, the department has amended the assessments on certain issues against the Bank.
The Bank has filed appealswhich are pendingat various appellateforums. in addition,certain decision made in favourof
the Bank are being contested by the department at higher forums. No provision has been made in the financial
statements as themanagementandthe Bank's legalcounsel are of the viewthat the issues willbe decidedin theBank's
favour as and when these are taken up by the Appellate Authorities.
---------- (Rupees in '000) ----------
TheFinanceAct, 2009and 2010have madesignificantamendmentsin theSeventhScheduleto Income TaxOrdinance,2001.The
deductionforprovisionfordoubtfulandlosscategoriesof advancesandoff balancesheetitemsisallowableupto a maximumof 1%
of totaladvanceswhereasprovisions for advances and off-balance sheet items for consumer and small and medium enterprises
(SMEs) ("as defined under theSBP's Prudential Regulations") isnow allowed at 5% of total consumer andSME portfolio.The
amountof baddebtsclassifiedas substandardunderPrudentialRegulationsissuedby StateBank of Pakistanwouldnotbe allowedas
an expense.
PACRA throughitsnotificationinJune2011,has assignedlongtermcreditratingof AA+[doubleA plus]and short-termcreditrating
of A1+ [A one plus] to the Bank.
16 SEGMENT DETAILS WITH RESPECT TO BUSINESS ACTIVITIES
The segment analysis with respect to business activity is as follows:
Total income 34,072
10,408,817
3,689,738
5,971,787
116,223
(20,611)
20,200,
Total expenses (10,812)
(1,783,236)
(8,553,789)
(997,798)
(58,496)
20,611
(11,383,
Income tax expense -
-
-
-
-
-
(3,048,
Net income 23,260
8,625,581
(4,864,051)
4,973,989
57,727
-
5,767,
Segment assets - (Gross of NPLs Provisions) 49,597
359,757,327
120,848,353
202,281,771
1,335,740
(1,011,946)
683,260,
Advance taxation (payment less provision) -
-
-
-
-
-
8,868,
Total assets 49,597
359,757,327
120,848,353
202,281,771
1,335,740
(1,011,946)
692,129,
Segment non performing loans -
-
8,061,887
18,208,405
-
-
26,270,
Segment specific provision required -
-
6,711,023
15,157,372
-
-
21,868,
Segment liabilities 4,631
21,695,261
516,062,029
30,858,885
99,840
(1,011,946)
567,708,
Deferred tax liabilities - net -
-
-
-
-
-
6,760,
Total liabilities - net 4,631
21,695,261
516,062,029
30,858,885
99,840
(1,011,946)
574,469,
Segment return on assets (ROA) (%) -
11.57% 12.93% 12.77% 34.80% -
-
Segment cost of fund (%) -
11.37% 4.44% 6.11% -
-
-
Total income 10,212
7,506,536
3,507,540
7,084,788
71,678
(25,440)
18,155,
Total expenses (7,651)
(1,459,525)
(7,132,321)
(1,572,564)
(39,446)
25,440
(10,186,
Income tax expense -
-
-
-
-
-
(2,856,
Net income 2,561
6,047,011
(3,624,781)
5,512,224
32,232
-
5,112,
Seg me nt a ssets - (Gross o f NPLs p ro v is ion ) 4 1,49 7
276,077,842
113,288,322
234,726,399
535,092
(709,094)
623,960,
Advance taxation (payment less provision) -
-
-
-
-
-
3,764,
Total assets 41,497
276,077,842
113,288,322
234,726,399
535,092
(709,094)
627,724,
Segment non performing loans -
-
6,700,062
18,193,854
-
-
24,893,
Segment specific provision required -
-
5,376,326
14,599,279
-
-
19,975,
Segment liabilities 3,976
24,748,306
463,859,918
29,698,803
24,644
(709,094)
517,626,
Deferred tax assets - - - - - - 5,343,
Total liabilities - net 3,97 6 24,748,306 463,85 9,91 8 29,698,803 24,644 (709,094) 522,970,
Segment return on assets (ROA) (%) - 10.88% 13.00% 12.87% 53.58% - -
Segment cost of fund (%) - 11.39% 3.96% 5.64% - - -
Asset
Management
Three months ended March 31, 2012
Three months ended March 31, 2011
E li mi na ti on To tal
---------------------------------------------(Rupees in '000)-----------------------------------------
Corporate
Finance
Trading
and
Sales
Retail &
Consumer
Banking
Commercial
Banking
---------- (Rupees in '000) ----------
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17 RELATED PARTY TRANSACTIONS
DepositsDeposits at beginning of the period / year 4,398,756
2,088,985 766,387
955,014 25,393,804
24,677,392 50,178 90,816
Deposits received during the period / year 1,100,134
20,407,581
30,536,355
169,261,154
74,117,220
250,452,445
190,356 830,780
Deposits repaid during the period / year (1,064,312)
(18,097,810)
(30,733,501)
(169,449,781)
(73,141,611)
(249,736,033)
(178,102) (871,418)
Deposits at the end of the period / year 4,434,578
4,398,756
569,241
766,387
26,369,413
25,393,804
62,432 50,178
Advances (secured)
Balance at beginning of the period / year -
-
-
-
81,302
-
49,743 54,474
Loan granted during the period / year -
-
-
-
67,815
81,302
1,796 3,525
Repayment during the period / year -
-
-
-
(54,072)
-
(4,895) (8,256)
Balance at end of the period / year -
-
-
-
95,045
81,302
46,644 49,743
Outstanding Balance of credit card 713
1,137
-
-
-
-
866 856
Receivable from Pension Fund -
-
-
-
15,031,898
14,731,898
- -
Adamjee Insurance Company Limited
Insurance premium paid-net of refund -
-
202,676
-
-
-
- -
Insurance claim settled -
-
17,863
8,443
-
-
- -
Rent Income received -
-
405
1,638
-
-
- -
Outstanding commitments and contingent liabilities -
-
8,365
8,365
-
-
- -
Banca Revenue -
-
89,554
38,144
-
-
- -
---------------------------------------------------------- (Rupees in '000) --------------------------------------------------------------
March 31,
2012
March /
December 31,
2011
March 31,
2012
March 31,
2012
Three months
ended
March 31,
2012
March 31,
2012
Three months
ended
March 31,
2012
Year
ended
Dec 31,
2011
Key management personnel
Year
ended
Dec 31,
2011
March /
December 31,
2011
March /
December 31,
2011
Year
ended
Dec 31,
2011
Key management personnel
Three months
ended
March 31,
2012
Other Related Parties
Year
ended
Dec 31,
2011
Directors Other Related Parties
March /
December 31,
2011
Directors
The Group has related party relationship with its associates, employee benefit plans and its key management personnel (including their associates) and companies with common directors.
TheGroupentersintotransactionswithrelatedpartiesinthe normalcourseof business.Contributionstoand accrualsin respectof staffretirementbenefitsandotherbenefitplansaremadeinaccordancewiththe
actuarial valuations / terms of the contribution plan. Remuneration to the executives / officers is determined in accordance with the terms of their appointment.
Three months
ended
March 31,
2012
Associates
Associates
Details of transactions with related parties and balances with them as at the period-end were as follows:
---------------------------------------------------------- (Rupees in '000) --------------------------------------------------------------
Adamjee Life Assurance Company Limited
Insurance Premium Paid - - 25,262 26,342 - - - -
Insurance claim settled -
-
18,686
-
-
-
- -
Outstanding commitments and contingent liabilities -
-
500
500
-
-
- -
Euronet Pakistan Private Limited
ATM Outsourcing Revenue -
-
29,258
5,607
-
-
- -
Capital injection -
-
-
52,519
-
-
- -
Trade payable -
-
4,292
7,317
-
-
- -
Training expenses reimbursed -
-
-
27
-
-
- -
Mayban International Trust (Labuan) Berhad
Forward foreign exchange contracts (Notional) -
-
-
-
-
1,913,753
- -
Unrealized loss on forward foreign exchange contracts -
-
-
-
-
40,914
- -
MCB Employees Foundation
Service expenses -
-
-
-
4,594
4,378
- -
Cash sorting expenses -
-
-
-
8,966
10,889
- -
Stationery Expenses -
-
-
-
40,095
31,484
- -
Advance receivable -
-
-
-
20,000
20,000
- -
Payable for stationery expenses -
-
-
-
6,834
1,255
- -
MCB Employees Security System
and Services (Private) Limited
Security guard expenses -
-
-
-
63,507
47,384
- -
Remuneration of key management personnel 16,134 15,302 - - - - 46,828 40,212Mark-up expense on deposits 89,899 21,785 20,410 16,535 995,318 1,058,302 1,059 1,025
Markup income on advances - - - - 2,346 - 888 636
Clearing expenses paid to NIFT - - - - 29,268 30,065 - -
Other miscellaneous expenses - - - - 3,195 3,924 - -
Investment in Metro-BankPakistan Sovereign Fund-Perpetual - - - - 4,000,000 4,000,000 - -
Dividend Income - - - - 216,893 - - -
Contribution to provident fund - - - - 43,941 39,703 - -
Commission Received - - 919 - 13 - - -
Gas charges - - - - 3,115 2,239 - -
Rent Paid - - - - 53 42 - -
Others
The chairman has been provided with free use of the Bank maintained car. The Chief Executive and certain executives are provided with free use of the Bank's maintained cars and household
equipment in accordancewith the terms of their employment.
MCMCB Bank Limited & Subsidiary Companies
Notes to the Consolidated Condensed Interim Financial Statements (Un-audited)For the three months period ended March 31, 2012
MCBMCB Bank Limited & Subsidiary Companies
Notes to the Consolidated Condensed Interim Financial Statements (Un-audited)For the three months period ended March 31, 2012
33 First Quarterly Report, 2012 First Quarterly Report, 2012
18 ISLAMIC BANKING BUSINESS
March 31, December 31
2012 2011
Assets
Cash and balances with treasury banks 278,465
334,39
Investments - net 2,818,271
2,938,70
Financing and receivables
- Murabaha 4,490,409
4,094,21
- Ijara 95,899
96,14
- Islamic export refinance 1,189,248
1,420,78
Fixed Assets 996,394
1,008,86
Deferred tax assets 720
Other assets 3,059,821
3,330,88
12,929,227
13,223,99
Liabilities
Bills payable 108,607
45,29
Deposits and other accounts -
- Current accounts 813,666 1,022,11
- Saving accounts 1,578,387
1,636,92
- Term deposits 3,259,045
4,565,23
- Others 13,759
81,50
Borrowing from SBP 1,391,682
1,664,99Due to head office 4,367,708
2,558,62
Deferred tax liability -
8,18
Other liabilities 372,270
449,51
11,905,124
12,032,39
Net assets 1,024,103
1,191,59
Represented by:
Islamic Banking Fund 1,000,000
1,000,00
Other Reserves (124)
7
Unappropriated profit 25,564
176,33
1,025,440
1,176,40
Surplus / (deficit) on revaluation of assets - net of tax (1,337)
15,19
1,024,103
1,191,59
CHARITY FUND
Opening balance 782 1,76
Additions during the year
Received from customers on delayed payments 829 1,39
Profit on charity saving account 14 12
843 1,51
---------- (Rupees in '000) --------
The Bank is operating 23 Islamic banking branches including 1 overseas branch (December 31, 2011: 23 branches includi
overseas). The statement of financial position of the Bank's Islamic Banking Branches as at March 31, 2012 is as follows:
Payments / utilization during the year
Social Welfare - (1,50
Health - (1,00
- (2,50
Closing balance 1,625 78
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MCBMCB Bank Limited & Subsidiary Companies
Notes to the Consolidated Condensed Interim Financial Statements (Un-audited)For the three months period ended March 31, 2012
35
MCMCB Bank Limited & Subsidiary Companies
First Quarterly Report, 2012 First Quarterly Report, 2012
19
20
21
Quarter ended Quarter ended
March 31,
2012
March 31,
2011
Income / return / profit earned 349,420
380,684
Income / return / profit expensed 278,248
266,914
Net Income / Profit 71,172
113,770
Provision against loans and advances - net (130)
9,290
Provision for diminution in the value of investments -
-
Bad debts written off directly -
-
(130)
9,290
Net profit / income after provisions 71,302
104,480
Other income
Fees, commission and brokerage income 8,904
13,723
Dividend income -
Income from dealing in foreign currencies 2,342
412
Other Income 30,406
5,467
Total other income 41,652
19,602
112,954
124,082
Other expenses
Administrative expenses 87,045
65,895
Other provisions / write offs -
-
Other charges (Penalty paid to SBP) 344
237
Total other expenses 87,389
66,132
Extra ordinary / unusual items -
-
Profit before taxation 25,565
57,950
Remuneration to Shariah Advisor / Board 486
420
GENERAL
- Figures have been rounded off to the nearest thousand of rupees unless otherwise stated.
-
NON-ADJUSTING EVENT
DATE OF AUTHORIZATION FOR ISSUE
Comparative information has been reclassified and rearranged in these unconsolidated condensed interim financial statements for the
purpose of comparison.
Theprofitand loss accountof theBank's Islamicbankingbusinessforthe threemonthsperiod ended March 31, 2012 isas
follows:
---------- (Rupees in '000) ----------
TheBoard of Directorsin itsmeetingheldon April24,2012hasannouncedcash dividendinrespect of the threemonthsperiodended
March 31, 2012of Rs. 3.00 per share (March 31, 2011: Rs. 3.00 per share). These consolidatedcondensed interimfinancial
statements for the three monthsperiodended March 31, 2012do not includethe effect of these appropriationswhich willbe
accounted for subsequent to the period end.
These consolidatedcondensedinterimfinancialstatements were authorizedfor issueby theBoardof Directorsof theBank intheir
meeting held on April 24, 2012 .
Sarmad Amin
Director
S.M. Muneer
President / CEOM.U.A. Usmani Mian Umer Mansha