Arab Banking Corporation B S CBAHRAIN: ABC

Third Quarter Financial Statements

Nov 11, 2025 at 2:51 PM UTC · Issued by Arab Banking Corporation B S C

Arab Banking Corporation (B.S.C.)

INTERIM CONDENSED CONSOLIDATED

FINANCIAL STATEMENTS

30 SEPTEMBER 2025 (REVIEWED)

Ernst & Young - Middle East

P.O. Box 140

East Tower, 10th Floor

Bahrain World Trade Center Manama, Kingdom of Bahrain

Tel: +973 1753 5455

Fax: +973 1753 5405

manama@bh.ey.com https://www.ey.com

C.R. No. 29977-1

REPORT ON REVIEW OF INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS TO THE BOARD OF DIRECTORS OF ARAB BANKING CORPORATION (B.S.C.)

Introduction

We have reviewed the accompanying interim condensed consolidated financial statements of Arab Banking Corporation (B.S.C.) [the "Bank"] and its subsidiaries [together the "Group"] as at 30 September 2025, comprising of the interim consolidated statement of financial position as at

30 September 2025, and the related interim consolidated statements of profit or loss and comprehensive income for the three-month period and nine-month period then ended, and interim consolidated statements of cash flows and changes in equity for the nine-month period then ended, and explanatory notes. The Bank's Board of Directors is responsible for the preparation and presentation of these interim condensed consolidated financial statements in accordance with International Accounting Standard 34 Interim Financial Reporting (IAS 34). Our responsibility is to express a conclusion on these interim condensed consolidated financial statements based on our review.

Scope of review

We conducted our review in accordance with International Standard on Review Engagements 2410, Review of Interim Financial Information Performed by the Independent Auditor of the Entity. A review of interim financial information consists of making inquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with International Standards on Auditing and, consequently, does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.

Conclusion

Based on our review, nothing has come to our attention that causes us to believe that the accompanying interim condensed consolidated financial statements are not prepared, in all material respects, in accordance with IAS 34.

11 November 2025

Manama, Kingdom of Bahrain

A member firm of Ernst & Young Global Limited

Arab Banking Corporation (B.S.C.)

INTERIM CONSOLIDATED STATEMENT OF FINANCIAL POSITION

30 September 2025 (Reviewed)

All figures in US$ Million

		Reviewed 30 September	Audited 31 December
	Notes	2025	2024
ASSETS
Liquid funds		2,521	3,636
Trading securities		1,204	838
Placements with banks and other financial institutions		2,411	2,071
Securities bought under repurchase agreements		919	1,288
Non-trading investments	4	16,039	16,117
Loans and advances	5	21,064	18,649
Other assets		4,146	3,442
Premises and equipment		235	224
TOTAL ASSETS		48,539	46,265
LIABILITIES
Deposits from customers		25,321	22,431
Deposits from banks		4,310	4,628
Certificates of deposit		320	244
Securities sold under repurchase agreements		8,470	10,086
Taxation		81	69
Other liabilities		3,550	2,783
Borrowings		1,468	1,381
Total liabilities		43,520	41,622
EQUITY
Share capital		3,110	3,110
Treasury shares		(6)	(6)
Statutory reserve		598	598
Retained earnings		1,562	1,458
Other reserves		(1,162)	(1,343)
EQUITY ATTRIBUTABLE TO THE SHAREHOLDERS OF
THE PARENT		4,102	3,817
Additional / perpetual tier-1 capital		390	390
Equity attributable to the shareholders of the parent
and perpetual instrument holders		4,492	4,207
Non-controlling interests		527	436
Total equity		5,019	4,643
TOTAL LIABILITIES AND EQUITY		48,539	46,265

These interim condensed consolidated financial statements were authorised for issue by the Board of Directors on 11 November 2025 and signed on their behalf by the Chairman, Deputy Chairman and the Group Chief Executive Officer.

H.E. Naji Belgasem Chairman

Abdulaziz Fahad Alhudaib Deputy Chairman

Sael Al Waary

Group Chief Executive Officer

Arab Banking Corporation (B.S.C.)

INTERIM CONSOLIDATED STATEMENT OF PROFIT OR LOSS

Nine-month period ended 30 September 2025 (Reviewed)

All figures in US$ Million

Reviewed

Three months ended 30 September

Reviewed

Nine months ended 30 September

	Notes	2025	2024	2025	2024
OPERATING INCOME
Interest and similar income		769	787	2,249	2,411
Interest and similar expense		(520)	(561)	(1,530)	(1,719)
Net interest income		249	226	719	692
Other operating income	6	112	102	314	310
Total operating income		361	328	1,033	1,002
OPERATING EXPENSES
Staff		121	118	362	355
Premises and equipment		16	15	44	43
Other		71	57	189	170
Total operating expenses		208	190	595	568
NET OPERATING PROFIT BEFORE
CREDIT LOSS EXPENSE AND TAXATION		153	138	438	434
Credit loss expense	7	(53)	(31)	(103)	(105)
PROFIT BEFORE TAXATION		100	107	335	329
Taxation charge	8	(30)	(25)	(81)	(62)
PROFIT FOR THE PERIOD		70	82	254	267
Profit attributable to non-controlling interests		(18)	(17)	(50)	(52)
PROFIT ATTRIBUTABLE TO THE
SHAREHOLDERS OF THE PARENT		52	65	204	215
BASIC AND DILUTED EARNINGS
PER SHARE (EXPRESSED IN US$)		0.014	0.018	0.060	0.064

H.E. Naji Belgasem Chairman

Abdulaziz Fahad Alhudaib Deputy Chairman

Sael Al Waary

Group Chief Executive Officer

Arab Banking Corporation (B.S.C.)

INTERIM CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

Nine-month period ended 30 September 2025 (Reviewed)

All figures in US$ Million

Reviewed		Reviewed
Three months end	ed	Nine months ended
30 September		30 September
2025	2024	2025	2024

	70	82	254	267
	44	34	196	(248)
	51	(2)	51	12
	95	32	247	(236)
	(4)	-	(4)	-
	-	5	3	4
	(4)	5	(1)	4
Other comprehensive income (loss) for the period	91	37	246	(232)
	161	119	500	35
			385
			115
	161	119	500	35

PROFIT FOR THE PERIOD

Other comprehensive income (loss):

Other comprehensive income (loss)

that will be reclassified (or recycled) to profit

or loss in subsequent periods:

Foreign currency translation:

Unrealised gain (loss) on exchange translation in

foreign subsidiaries

Debt instruments at FVOCI:

Net change in fair value during the period

Other comprehensive income (loss) that will not be

reclassified (or recycled) to profit or loss

in subsequent periods:

Net change in pension fund reserve

Net change in fair value of FVOCI equity securities

during the period

TOTAL COMPREHENSIVE INCOME

FOR THE PERIOD

Attributable to:

Shareholders of the parent

Non-controlling interests

132 92

29 27

(1)

Arab Banking Corporation (B.S.C.)

INTERIM CONSOLIDATED STATEMENT OF CASH FLOWS

Nine-month period ended 30 September 2025 (Reviewed)

All figures in US$ million

Reviewed
Nine months ended
30 September
2025	2024

OPERATING ACTIVITIES

Profit for the period

Adjustments for:

Credit loss expense

Depreciation and amortisation

Gain on disposal of non-trading debt investments - net

Changes in operating assets and liabilities:

Trading securities

Placements with banks and other financial institutions

Securities bought under repurchase agreements

Loans and advances

Other assets

Deposits from customers

Deposits from banks

Securities sold under repurchase agreements

Other liabilities

Other non-cash movements

(218)		(186)
(219)		(515)
468		761
(1,148)		(1,618)
(411)		(588)
1,546		742
(611)		541
(1,678)		1,824
510		587
(66)		(453)
(1,438)		1,493

254 267

103

(23)

105

(23)

Net cash (used in) from operating activities

INVESTING ACTIVITIES

Purchase of non-trading investments

Sale and redemption of non-trading investments

Purchase of premises and equipment

Sale of premises and equipment

Investment in subsidiaries - net

(25,269)

25,629

(31)

(21,625)

17,570

(12)

(2)

Net cash from (used in) investing activities 338 (4,063)

FINANCING ACTIVITIES

Issue of certificates of deposit - net

Issue / (Proceeds) from borrowings - net

Interest paid on additional / perpetual tier-1 capital

Dividend paid to the Bank's shareholders

Dividend paid to non-controlling interests

73	97
(22)	112
(19)	(19)
(85)	(70)
(29)	(21)

Net cash (used in) from financing activities (82) 99

Net change in cash and cash equivalents

Effect of exchange rate changes on cash and cash equivalents

Cash and cash equivalents at beginning of the period

(1,182) (2,471)

67 (3)

3,636 4,466

CASH AND CASH EQUIVALENTS AT END OF THE PERIOD 2,521 1,992

Arab Banking Corporation (B.S.C.)

INTERIM CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

Nine-month period ended 30 September 2025 (Reviewed)

All figures in US$ Million

Equity attributable to the shareholders of the parent

Other reserves

Additional

/ perpetual

tier-1 capital

Non-controlling

interests Total equity

						Foreign exchange	Cumulative	Pension
	Share	Treasury	Statutory	Retained	General	translation	changes in	fund
	capital	shares	reserve	earnings*	reserve	adjustments	fair value	reserve	Total
At 31 December 2024	3,110	(6)	598	1,458	100	(1,437)	28	(34)	3,817 390 436 4,643
Profit for the period	-	-	-	204	-	-	-	-	204	-	50	254
Other comprehensive
income (loss) for the period	-	-	-	-	-	131	54	(4)	181	-	65	246
Total comprehensive income
(loss) for the period	-	-	-	204	-	131	54	(4)	385	-	115	500
Dividend**	-	-	-	(85)	-	-	-	-	(85)	-	(29)	(114)
Interest paid on additional /
perpetual tier-1 capital	-	-	-	(19)	-	-	-	-	(19)	-	-	(19)
Other equity movements
in subsidiaries	-	-	-	4	-	-	-	-	4	-	5	9
At 30 September 2025 (reviewed)	3,110	(6)	598	1,562	100	(1,306)	82	(38)	4,102	390	527	5,019

* Retained earnings include non-distributable reserves arising from consolidation of subsidiaries amounting to US$ 565 million (31 December 2024: US$ 560 million).

** A dividend of US$ 0.0275 per share (2023: US$ 0.0225 per share) for the year 2024 was approved for payment at the Annual General Meeting held on 16 March 2025 and paid during the period.

Arab Banking Corporation (B.S.C.)

INTERIM CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

Nine-month period ended 30 September 2025 (Reviewed)

All figures in US$ Million

Equity attributable to the shareholders of the parent

Other reserves

Additional

/ perpetual

tier-1 capital

Non-controlling

interests Total equity

						Foreign exchange	Cumulative	Pension
	Share	Treasury	Statutory	Retained	General	translation	changes in	fund
	capital	shares	reserve	earnings*	reserve	adjustments	fair value	reserve	Total
At 31 December 2023	3,110	(6)	569	1,283	100	(1,126)	13	(33)	3,910	390	504	4,804
Profit for the period	-	-	-	215	-	-	-	-	215	-	52	267
Other comprehensive (loss)
income for the period	-	-	-	-	-	(195)	16	-	(179)	-	(53)	(232)
Total comprehensive income
(loss) for the period -		-	-	215	-	(195)	16	-	36	-	(1)	35
Dividend** -		-	-	(70)	-	-	-	-	(70)	-	(21)	(91)
perpetual tier-1 capital -		-	-	(19)	-	-	-	-	(19)	-	-	(19)
in subsidiaries -		-	-	3	-	-	-	-	3	-	7	10
At 30 September 2024 (reviewed) 3,110		(6)	569	1,412	100	(1,321)	29	(33)	3,860	390	489	4,739

Interest paid on additional / Other equity movements

* Retained earnings include non-distributable reserves arising from consolidation of subsidiaries amounting to US$ 560 million as at 30 June 2024 (31 December 2023: US$ 555 million).

** A dividend of US$ 0.0225 per share for the year 2023 was approved for payment at the Annual General Meeting held on 24 March 2024 and paid during the period ended 30 September 2024.

Arab Banking Corporation (B.S.C.)

NOTES TO THE INTERIM CONDENSED CONSOLIDATED FINANCIAL

STATEMENTS

30 September 2025 (Reviewed)

All figures in US$ million

1	INCORPORATION AND ACTIVITIES

Arab Banking Corporation (B.S.C.) [the "Bank"] is incorporated in the Kingdom of Bahrain by an Amiri decree and operates under a wholesale banking licence issued by the Central Bank of Bahrain (the "CBB"). The Bank is a Bahraini Shareholding Company with limited liability and is listed on the Bahrain Bourse. The Central Bank of Libya is the ultimate parent of the Bank and its subsidiaries (together the "Group").

The Bank's registered office is at ABC Tower, Diplomatic Area, P.O. Box 5698, Manama, Kingdom of Bahrain. The Bank is registered under commercial registration number 10299 issued by the Ministry of Industry and Commerce, Kingdom of Bahrain.

The Group is a leading provider of Trade Finance, Treasury, Project & Structured Finance, Syndications, Corporate & Institutional Banking, Islamic Banking services and the digital, mobile-only banking space named "ila Bank" within retail consumer banking services. Retail banking services are only provided in the MENA region.

2	BASIS OF PREPARATION AND CHANGES TO THE GROUP'S ACCOUNTING POLICIES

2.1

Basis of preparation

The interim condensed consolidated financial statements for the nine-month period ended 30 September 2025 have

been prepared in accordance with IAS 34 Interim Financial Reporting (IAS 34).

The interim condensed consolidated financial statements do not include all the information and disclosures required in the annual consolidated financial statements, and should be read in conjunction with the Group's annual consolidated financial statements as at 31 December 2024. In addition, results for the nine-month period ended 30 September 2025 are not necessarily indicative of the results that may be expected for the financial year ending 31 December 2025.

2.2

New and amended standards and interpretations adopted by the Group

The accounting policies adopted in the preparation of the interim condensed consolidated financial statements are consistent with those followed in the preparation of the Group's annual consolidated financial statements for the year ended 31 December 2024. On 1 January 2025, the Group adopted 'Amendments to IAS 21: The effects of

Change in Foreign Exchange Rates'. The adoption of the amendments had minimal impact on the Group.

2.3

New standards, interpretations and amendments issued but not yet effective

There are certain new standards, interpretations and amendments that are issued as of 30 September 2025, which were applicable to the Group and not yet effective up to the date of issuance of the Group's interim condensed consolidated financial statements. The management will assess the impact of implementation of these standards prior to their adoption on effective dates. The Group has not early adopted any new and amended standard or

interpretation that has been issued but is not yet effective.

3	SUMMARY OF MATERIAL ACCOUNTING POLICIES

The accounting policies, estimates and assumptions used in the preparation of these interim condensed consolidated financial statements are consistent with those used in the preparation of the annual consolidated financial statements for the year ended 31 December 2024 except for adoption of new standards and amendments effective from 1 January 2025.

Arab Banking Corporation (B.S.C.)

NOTES TO THE INTERIM CONDENSED CONSOLIDATED FINANCIAL

STATEMENTS

30 September 2025 (Reviewed)

All figures in US$ million

4	NON-TRADING INVESTMENTS

		Audited
		31 December
		2024
Debt securities
At amortised cost	8,467	9,283
At FVOCI	7,621	6,888
	16,088	16,171
ECL allowance	(75)	(75)
Debt securities - net	16,013	16,096

	26	21

26		21
16,039		16,117

Reviewed

30 September

2025

Equity securities

At FVOCI

Following are the stage wise break-up of debt securities as of 30 September 2025 and 31 December 2024:

30 September 2025 (Reviewed)
Stage 1	Stage 2	Stage 3	Total

Debt securities, gross

ECL allowance

16,024 -

(11) -

16,088

(75)

64 (64) 16,013 - - 16,013

31 December 2024 (Audited)
Stage 1	Stage 2	Stage 3	Total

Debt securities, gross

ECL allowance

16,107 -

(11) -

16,171

(75)

(64)

16,096 - - 16,096

Arab Banking Corporation (B.S.C.)

NOTES TO THE INTERIM CONDENSED CONSOLIDATED FINANCIAL

STATEMENTS

30 September 2025 (Reviewed)

All figures in US$ million

5	LOANS AND ADVANCES

30 September 2025 (Reviewed)
Stage 1	Stage 2	Stage 3	Total

Loans and advances, gross

ECL allowances

20,329 633

(95) (80)

21,785

(721)

823 (546) 20,234 553 277 21,064

31 December 2024 (Audited)
Stage 1	Stage 2	Stage 3 Total

Loans and advances, gross

ECL allowances

17,984 583

(136) (68)

19,266

(617)

699

(413)

17,848 515 286 18,649

As at 1 January 2025

Net transfers between stages

Amounts written-off

(Reversal) / charge for the period - net

Exchange adjustments and other movements

136 68

1 7

- -

(47) 4

5 1

617

(30)

106

721

Total

As at 1 January 2024

Net transfers between stages

Amounts written-off

Charge for the period - net

Exchange adjustments and other movements

139 74

1 (11)

- -

4 6

(1) (2)

648

(95)

101

(33)

An analysis of movement in the ECL allowance during the period ended 30 September 2025 and 30 September 2024 are as follows:

Reviewed	Stage 1	Stage 2	Stage 3 413	Total
			(8)
			(30)
			149
			22
As at 30 September 2025	95	80	546
Reviewed	Stage 1	Stage 2	Stage 3
			435
			10
			(95)
			91
			(30)
As at 30 September 2024	143	67	411	621

Arab Banking Corporation (B.S.C.)

NOTES TO THE INTERIM CONDENSED CONSOLIDATED FINANCIAL

STATEMENTS

30 September 2025 (Reviewed)

All figures in US$ million

6	OTHER OPERATING INCOME

Reviewed
30 September	30 September
2025	2024

Fee and commission income*

Fee and commission expense

Fee and commission income - net

Bureau processing income

Net gain from trading book (including foreign currencies transaction)

Gain on disposal of non-trading debt investments - net

Merchant acquiring income

Brokerage income - net

Others - net

159	166
(4)	(4)
155	162
26	32
26	34
23	32
18	12
20	18
46	20

314 310

*Included in the fee and commission income is US$ 9 million (30 September 2024: US$ 11 million) of fee income relating to funds under management.

7	CREDIT LOSS EXPENSE

Reviewed
30 September	30 September
2025	2024

Loans and advances

Credit commitments and contingent items

Other financial assets

106 101

(3) 3

- 1

103 105

TAXATION

The tax expense for the period was as follows:

Reviewed
30 September	30 September
2025	2024

Taxation related to parent

Taxation related to subsidiaries

7 -

74 62

81 62

The Group is within the scope of the Organisation for Economic Co-operation and Development (OECD) Inclusive Framework (IF) on Base Erosion and Profit Shifting (BEPS) Pillar 2 model rules, under which multinational entities (MNE Group) whose revenue exceeds EUR 750 million are liable to pay corporate income tax at a minimum effective tax rate of 15% in each jurisdiction they operate. Most of the jurisdictions in which the Group operates have enacted the Pillar 2 legislation, of which Kingdom of Bahrain would be the most impactful for the Group, since there was no tax previously enacted in the Kingdom of Bahrain.

Arab Banking Corporation (B.S.C.)

NOTES TO THE INTERIM CONDENSED CONSOLIDATED FINANCIAL

STATEMENTS

30 September 2025 (Reviewed)

All figures in US$ million

8	TAXATION (continued)

The Kingdom of Bahrain issued Decree-Law no (11) of 2024 (the "Law") on 1 September 2024 introducing Domestic Minimum Top-up Tax ("DMTT") effective from the year 2025 on entities which are part of MNE Group with annual revenues of EUR 750 million or more. This was followed by Executive regulations issued on 15 December 2024 under decision no (172) of 2024. The Group has performed an assessment and estimated the top-up tax charge for the period ended 30 September 2025 in line with the respective regulations and based on OECD guidelines. As the regulatory framework continues to evolve and implementation guidance is further clarified, the Group continues to monitor developments and assess the impact of evolving Pillar 2 tax regulations on its future financial performance and resultant tax obligations.

9	OPERATING SEGMENTS

For management purposes, the Group is organised into five operating segments which are based on business units and their activities. The Group has accordingly been structured to place its activities under the distinct divisions which are as follows:

-	MENA subsidiaries cover retail, corporate and treasury activities of subsidiaries in North Africa and

International wholesale banking encompasses corporate and structured finance, trade finance, Islamic

banking services and syndications;

Group treasury comprises treasury business of Bahrain Head Office, New York and London;

ABC Brasil primarily reflects the commercial banking and treasury activities of the Brazilian subsidiary Banco ABC Brasil S.A., focusing on the corporate and middle market segments in Brazil and its related holding company; and

-	Others includes activities of the Head Office, Arab Financial Services Company B.S.C. (c) and ila Bank.

Nine-month period ended

'30 September 2025

(Reviewed)

International

wholesale

banking

MENA

subsidiaries

Group

treasury

ABC

Brasil

Others Total

Net interest income

Other operating income

159	156 30 263 111 719
41	75 55 88 55 314

Profit for the period						254
	5,385	12,096	18,632	11,535	893	48,541
	4,633	-	27,563	10,226	1,098	43,520

Total operating income 200 231 85 351 166 1,033

Operating expenses	(107)	(111)	(28)	(146)	(88)	(480)
Profit before taxation,
credit loss and unallocated
operating expenses	93	120	57	205	78	553
Credit loss expense	(8)	(42)	-	(53)	-	(103)
Taxation charge	(30)	(16)	(5)	(32)	2	(81)
Unallocated operating expenses						(115)

Operating assets

as at 30 September 2025

Operating liabilities

as at 30 September 2025

Arab Banking Corporation (B.S.C.)

NOTES TO THE INTERIM CONDENSED CONSOLIDATED FINANCIAL

STATEMENTS

30 September 2025 (Reviewed)

All figures in US$ million

9	OPERATING SEGMENTS (continued)

Nine-month period ended

'30 September 2024

(Reviewed)

International

wholesale

banking

MENA

subsidiaries

Group

treasury

ABC

Brasil

Others Total

Net interest income

Other operating income

158	154	20	236	124	692
35	77	41	112	45	310

Total operating income 193 231 61 348 169 1,002

Operating expenses	(96)	(116)	(18)	(152)	(82)	(464)
Profit before taxation,
credit loss and unallocated
operating expenses	97	115	43	196	87	538
Credit loss expense	(12)	(49)	-	(43)	(1)	(105)
Taxation charge	(28)	(16)	-	(18)	-	(62)
Unallocated operating expenses	(104)

Operating assets

as at 31 December 2024

(Audited)

Operating liabilities

as at 31 December 2024

(Audited)

Profit for the period 267

4,896 11,001 19,068 10,652 648 46,265

10	FAIR VALUE OF FINANCIAL INSTRUMENTS

4,196 - 26,879 9,585 962 41,622

The following tables provide the fair value measurement hierarchy of the Group's financial assets and financial liabilities measured at fair value in these financial statements.

Quantitative disclosure of fair value measurement hierarchy for assets as at 30 September 2025 (Reviewed): Financial assets measured at fair value:

Level 1 Level 2 Level 3 Total

Trading securities

Non-trading investments

Loans and advances

Derivatives held for trading

Derivatives held as hedges

540

7,037

734

488

609

1,163

413

176

1,204

7,646

1,163

1,147

Quantitative disclosure of fair value measurement hierarchy for liabilities as at 30 September 2025 Financial liabilities measured at fair value:

Level 1 Level 2 Level 3 Total

Derivatives held for trading

Derivatives held as hedges

537

274

811

Arab Banking Corporation (B.S.C.)

NOTES TO THE INTERIM CONDENSED CONSOLIDATED FINANCIAL

STATEMENTS

30 September 2025 (Reviewed)

All figures in US$ million

10	FAIR VALUE OF FINANCIAL INSTRUMENTS (continued)

Quantitative disclosure of fair value measurement hierarchy for assets as at 31 December 2024 (Audited):

Financial assets measured at fair value:

Level 1 Level 2 Level 3 Total

Trading securities

Non-trading investments

Loans and advances

Derivatives held for trading

Derivatives held as hedges

548

6,265

563

174

640

547

541

121

116

838

6,909

547

1,104

121

Quantitative disclosure of fair value measurement hierarchy for assets as at 31 December 2024 (Audited): Financial liabilities measured at fair value:

Level 1 Level 2 Level 3 Total

Derivatives held for trading

Derivatives held as hedges

467

285

752

Fair values of financial instruments not carried at fair value

Except for the following, the fair value of financial instruments which are not carried at fair value are not materially

different from their carrying value.

Reviewed Audited

30 September 2025 31 December 2024

Carrying

value

Fair Carrying Fair

value value value

Financial assets

Non-trading debt investments

at amortised cost - gross (level 1 and 2)

8,464

9,283

Financial liabilities

Borrowings - perpetual (level 1)

8,468			9,280
221	248	238	253

For financial instruments that are recognised at fair value on a recurring basis, the Group determines whether transfers have occurred between levels in the hierarchy by re-assessing categorisation at the end of each reporting period.

Financial instruments in level 1

The fair value of financial instruments traded in active markets is based on quoted market prices at the reporting date. A market is regarded as active if quoted prices are readily and regularly available from an exchange, dealer, broker, industry group, pricing service, or regulatory agency, and those prices represent actual and regularly occurring market transactions on an arm's length basis. The quoted market price used for financial assets held by

the Group is the current bid price. These instruments are included in Level 1.

Financial instruments in level 2

The fair value of financial instruments that are not traded in an active market (for example, over-the-counter derivatives) is determined by using valuation techniques. These valuation techniques maximise the use of observable market data where it is available and rely as little as possible on entity specific estimates. If all significant inputs required to fair value an instrument are observable, the instrument is included in level 2.

Arab Banking Corporation (B.S.C.)

NOTES TO THE INTERIM CONDENSED CONSOLIDATED FINANCIAL

STATEMENTS

30 September 2025 (Reviewed)

All figures in US$ million

10	FAIR VALUE OF FINANCIAL INSTRUMENTS (continued)

Financial instruments in level 3

The fair value of financial instruments that are neither traded in an active market nor have observable inputs is determined by valuation techniques. These valuation techniques include an internal model which uses observable market yield curves and expected loss methodology for securities. Quotes provided by fund administrators are used

for funds valuation.

Transfers between level 1, level 2 and level 3

There were no transfers between level 1, level 2 and level 3 during the current and prior period.

11	CREDIT COMMITMENTS AND CONTINGENT ITEMS

a)	Exposure (after applying credit conversion factor) and ECL by stage

30 September 2025 (Reviewed)
Stage 1	Stage 2	Stage 3	Total

Credit commitments and contingencies	4,353	73	36	4,462
ECL allowance	8	8	15	31

31 December 2024 (Audited)
Stage 1	Stage 2	Stage 3	Total

Credit commitments and contingencies	4,179	83	38	4,300
ECL allowance	8	11	10	29

An analysis of movement in the ECL allowance during the period are as follows:

Stage 1 Stage 2 Stage 3 Total

As at 1 January 2025

ECL movements for the period - net

(3)

As at 30 September 2025 (reviewed)	8	8	15	31
	Stage 1	Stage 2	Stage 3	Total

As at 1 January 2024

ECL movements for the period - net

(1)

As at 30 September 2024 (reviewed) 8 12 12 32

Arab Banking Corporation (B.S.C.)

NOTES TO THE INTERIM CONDENSED CONSOLIDATED FINANCIAL

STATEMENTS

30 September 2025 (Reviewed)

All figures in US$ million

11	CREDIT COMMITMENTS AND CONTINGENT ITEMS (continued)

b)	Credit commitments and contingencies

30 September 2025 (Reviewed)
Stage 1	Stage 2	Stage 3	Total

4,142

2,970

3,332

4,263

3,019

3,367

Short-term self-liquidating trade and

transaction-related contingent items

Direct credit substitutes, guarantees

Undrawn loans and other commitments

Credit exposure before applying credit

conversion factor

10,444 148 57 10,649

Credit exposure after applying credit

conversion factor

4,353 73 36 4,462

Risk weighted equivalents 3,776

31 December 2024 (Audited)
Stage 1	Stage 2	Stage 3	Total

Short-term self-liquidating trade and

transaction-related contingent items

Direct credit substitutes, guarantees

Undrawn loans and other commitments

Credit exposure before applying credit

conversion factor

3,996

2,814

3,047

4,135

2,861

3,073

Credit exposure after applying credit

conversion factor

9,857	141	71	10,069
4,179	83	38	4,300
			3,591

Risk weighted equivalents

c)	Derivatives
The outstanding notional amounts at the reporting date were as follows:

Reviewed

30 September

2025

Audited

31 December

2024

Interest rate swaps

Currency swaps

Forward foreign exchange contracts

Options

Futures

28,937	21,997
1,905	982
16,076	11,294
21,293	13,537
2,544	3,210

70,755	51,020
2,453	1,928

Risk weighted equivalents (credit and market risk)

Arab Banking Corporation (B.S.C.)

NOTES TO THE INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

30 September 2025 (Reviewed)

All figures in US$ million

12	RISK MANAGEMENT

Liquidity risk

The Group is required to comply with the liquidity requirements as stipulated by its regulator, the CBB. These requirements relate to maintaining a minimum of 100% for liquidity coverage ratio (LCR) and net stable funding ratio (NSFR). LCR is calculated as a ratio of its stock of high quality liquid assets (HQLA) and net outflows over the next 30 calendar days. NSFR is calculated as a ratio of 'available stable funding' to 'required stable funding'. As at 30 September 2025, the Group's LCR and NSFR were at 297% (31 December 2024: 198%) and 119% (31 December 2024: 123%) respectively.

30 September 2025

31 December 2024

Unweighted Values (i.e. before applying relevant factors)

No specified maturity

Less than 6

months

Over 6 months and less than one

year

Over one

year

Total weighted

value

Over 6 months

No and less

specified Less than 6 than one Over one maturity months year year

Total weighted

value

Available Stable Funding (ASF):
Capital:
Regulatory Capital	4,405	-	-	-	4,405	4,112	-	-	-	4,112
Other Capital Instruments	527	-	-	306	832	488	-	-	327	815
Retail deposits and deposits from small business customers:
Stable deposits	-	-	-	-	-	-	-	-	-	-
Less stable deposits	-	2,396	311	359	2,795	-	2,098	277	259	2,397
Wholesale funding:
Operational deposits	-	-	-	-	-	-	-	-	-	-
Other wholesale funding	-	27,180	4,321	6,110	13,936	-	25,060	4,481	7,217	13,524
Other liabilities:
NSFR derivative liabilities	-	28	-	-	-	-	-	-	-	-
All other liabilities not included in the above categories	-	1,056	-	-	-	-	1,117	-	-	-

Total ASF (A) 21,968 20,848

Arab Banking Corporation (B.S.C.)

NOTES TO THE INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

30 September 2025 (Reviewed)

All figures in US$ million

12	RISK MANAGEMENT (continued)

30 September 2025

31 December 2024

Unweighted Values (i.e. before applying relevant factors)

No specified maturity

Less than 6

months

Over 6 months and less than one

year

Over one

year

Total weighted

value

Over 6 months

No and less

specified Less than 6 than one Over one maturity months year year

Total weighted

value

Required Stable Funding (RSF):

16,060 -	264 -	- -	- -	1,142 -	15,736 -	175 -	- -	- -	1,163 -
-	-	-	-	-	-	-	-	-	-
-	3,910	1,507	1,072	2,394	-	3,884	919	727	1,730
-	7,540	2,452	6,535	10,550	-	7,130	2,653	5,484	9,553
-	-	-	316	205	-	-	-	323	210
-	-	-	-	-	-	-	-	-	-
-	479	168	2,288	2,268	-	173	259	1,531	1,517
-	-	-	-	-	-	-	-	-	-
-	-	-	-	-	-	-	-	-	-
-	-	-	-	-	-	106	-	-	106
-	6	-	-	6	-	-	-	-	-
2,730	479	20	982	1,310	3,765	506	6	1,882	2,209
-	10,925	-	-	546	-	10,370	-	-	518

Total NSFR high-quality liquid assets (HQLA)

Deposits held at other financial institutions for operational purposes Performing loans and securities:

Performing loans to financial institutions secured by Level 1 HQLA Performing loans to financial institutions secured by non-level 1 HQLA and

unsecured performing loans to financial institutions

Performing loans to non- financial corporate clients, loans to retail and small business customers, and loans to sovereigns,

central banks and PSEs, of which:

With a risk weight of less than or equal to 35% as per the CBB Capital Adequacy Ratio guidelines

Performing residential mortgages, of which:

With a risk weight of less than or equal to 35% under the CBB Capital Adequacy Ratio Guidelines

Securities that are not in default and do not qualify as HQLA, including exchange-traded equities

Other assets:

Physical traded commodities, including gold

Assets posted as initial margin for derivative contracts and contributions to default funds of CCPs

NSFR derivative assets

NSFR derivative liabilities before deduction of variation margin posted All other assets not included in the above categories

OBS items

Total RSF (B)

NSFR (A/B)

18,421

119%

17,006

123%

Arab Banking Corporation (B.S.C.)

NOTES TO THE INTERIM CONDENSED CONSOLIDATED FINANCIAL

STATEMENTS

30 September 2025 (Reviewed)

All figures in US$ million

13	TRANSACTIONS AND BALANCES WITH RELATED PARTIES

Related parties represent the ultimate parent, major shareholders, associates, directors and key management personnel of the Group and entities controlled, jointly controlled or significantly influenced by such parties. Pricing policies and terms of these transactions are approved by the Group's management.

Major

share-

holder

30 September

2025

(Reviewed)

The period-end and year-end balances in respect of related parties included in the interim consolidated statement of financial position are as follows:

Ultimate

parent

Deposits from customers

Borrowings

Additional / perpetual tier-1 capital*

Short-term self-liquidating trade and

transaction-related contingent items

Directors

2,795

1,115

390

2,796

1,115

390

Major

share-

holder

31 December

2024

(Audited)

865 - - 865

Ultimate

parent

Deposits from customers

Borrowings

Additional / perpetual tier-1 capital*

Short-term self-liquidating trade and

transaction-related contingent items

Directors

2,795

1,115

390

2,833

1,115

390

1,049 - - 1,049

* During the period, the Group has paid interest on additional / perpetual tier-1 capital amounting to US$ 19 million (30 September 2024: US$ 19 million) which has been charged to the interim consolidated statement of changes in equity.

The income and expenses in respect of transactions with related parties included in the interim consolidated statement of profit or loss are as follows:

30 September	30 September
2025	2024
Reviewed

Commission income

Interest expense

162

183

14	SUBSEQUENT EVENTS

On 9 October 2025, the Group has issued Basel 3 compliant additional / perpetual Tier 1 Capital securities amounting to US$ 200 million to its ultimate parent. These securities are perpetual, subordinated and unsecured and carry an interest of 8% per annum payable semi-annually. The holders of these securities do not have a right to claim the interest and such an event of non-payment will not be considered an event of default.

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Third Quarter Financial Statements​​​

Earlier from Arab Banking Corporation B S C

Third Quarter Financial Statements