Transmission of Financial Statements for the Quarter ended 30.09.2025

CORPORATE INFORMATION

As of September 30, 2025

Board of Directors

Ikramullah Khan Chairman / Non-Executive Director

Amer Sultan Tareen Non-Executive Director

Abid Sa ar Independent Director

Syed Asad Ali Shah Independent Director

Tahir Jawaid Independent Director

Osman Asghar Khan Independent Director

Muhammed Shahid Sadiq Independent Director

Natasha Jehangir Khan Independent Director

Managing Director / CEO

Hassan Raza

Shariah Board

Mufti Muhammad Zahid Chairman Shariah Board

Mufti Muhammad Arif Khan Member Shariah Board

Mufti Abdul Wahab Member Shariah Board

Qazi Abdul Samad Resident Shariah

Board Member (RSBM)

Board Audit Committee

Syed Asad Ali Shah Chairman

Amer Sultan Tareen Member

Abid Sa ar Member

Muhammed Shahid Sadiq Member

Osman Asghar Khan Member

Board Human Resource & Remuneration Committee

Abid Sa ar Chairman

Tahir Jawaid Member

Osman Asghar Khan Member

Natasha Jehangir Khan Member

Board Risk Management Committee

Abid Sa ar Chairman

Amer Sultan Tareen Member

Muhammed Shahid Sadiq Member

Managing Director Member

1

Osman Asghar Khan Chairman

Tahir Jawaid Member

Syed Asad Ali Shah Member

Natasha Jehangir Khan Member

Managing Director Member

Muhammed Shahid Sadiq Chairman

Amer Sultan Tareen Member

Natasha Jehangir Khan Member

Managing Director Member

Irfan Saleem Awan

Raza Mohsin Qizilbash

Registered Office / Head Office The Bank of Khyber

24 - The Mall, Peshawar Can .

UAN# 00-92-91-111 95 95 95

URL: https://www.bok.com.pk

M/s Pwc A.F. Ferguson & Co. Chartered Accountants

M/s. Mohsin Tayebaly & Co., Karachi

THK Associates (Pvt) Ltd.

Plot # 32 - C, Jami Commercial Street 2 D.H.A, Phase-VII,

Karachi-75500.

2

Directors' Review

On behalf of the Board of Directors of Bank of Khyber (The Bank or BoK), I am pleased to present the condensed interim financial information of the Bank for the nine month period ended September 30, 2025.

Financial Highlights

The financial highlights of the Bank for the period under review are as follows

Rs. In Million As at

Basic and diluted earnings per share 4.29 2.27

Performance Review

The Bank achieved remarkable performance during the nine month period whereby profit after tax surged by 89% year -on-year (YoY) to Rs. 4,973 million as compared to Rs. 2,632 million during the same period last year.

Net Markup/Interest Income for the period increased by 19% YoY to Rs. 14,524 million as a result of robust balance sheet management and successful reduction in funding costs achieved during the period. Non-markup/interest income also recorded significant growth, rising sharply by 178% YoY to Rs. 3,648 million (9M period ended September 30, 2024: Rs. 1,311 million). The main contributors in non-markup income were gain on securities, fee and commission income and foreign exchange income. During the period, the management took benefit of the capital gain opportunities offered by the prevailing interest rate scenario and realized gains on securities amounting to Rs. 2,215 million (9M 2024: Rs. 7 million).

To improve the non-mark income stream, special focus is being given to trade finance, investment banking and home remi ances businesses. The Bank has launched its home remi ance product with the brand name of BoK KOR Pay which has received a very healthy response from our overseas KPK diaspora. Moreover, the Bank has launched its MasterCard debit card. This is a significant milestone achieved by the Bank in pursuit of its goal for providing convenient and world class banking services to it's customers.

Non mark-up expenses rose by 12% YoY to Rs. 8,527 million, reflecting increase in employee and other administrative costs due to the impact of inflation and overall increase in activities of the Bank.

As a result of the strenuous recovery efforts and prudent lending strategy followed by the management, the Bank achieved net reversal in provisions amounting to Rs. 959 million during the nine month period under review, compared to the net provision reversal of Rs. 142 million during the same period last year.

The Bank's deposit base as on September 30, 2025 stood at Rs. 374,340 million as against Rs. 277,642 million as of December 31, 2024. Gross Advances of the Bank at the nine month period end amounted to Rs. 134,139 million while net investments stood at Rs. 282,013 million. The management is working on a prudent strategy to gradually increase its ADR (Advances to Deposits Ratio) by focusing on all the business segments i.e. Corporate, SMEs, Agriculture and Consumer.

Total assets of the Bank as of September 30, 2025 increased to Rs. 481,810 million as against Rs. 477,564 million on December 31, 2024.

3

Status of Conversion into Islamic Bank

During the nine month period ended September 30, 2025, the Bank announced initiation of the process for its conversion to a full-fledged Islamic Bank. The Bank is taking all the necessary steps for achievement of this landmark initiative as per the plan. In pursuit of this goal, 59 branches have been converted from conventional to Islamic banking during the review period. Accordin gly, Islamic banking branch network of the Bank has increased to 191 branches (out of the total of 247 branches) at the period end while there are 56 Islamic Banking Windows to support the conversion of conventional banking branches.

Credit Rating

In June-2025, VIS Credit Rating Company Limited (VIS) upgraded the Medium to Long Term entity rating of the Bank to AA- (Double A minus) from A+ (Single A plus) which indicates high credit quality. Moreover, Short Term rating of the Bank was reaffirmed at A1 (A one).

The Pakistan Credit Rating Agency Limited (PACRA) in June 2025 reaffirmed the Medium to Long term and the Short Term entity ratings of the Bank at A+ (Single A plus) and A1 (A one) respectively.

These ratings have been assigned a stable outlook by both the rating companies.

Future Outlook

Going forward, the Bank will continue its emphasis on sustainable profitability through diversification of its deposit base, lower cost of funds, asset quality improvement and broadening of portfolio through proactive strategies. Special focus will continu e on further reducing the NPL/infection ratio by following a prudent underwriting strategy jointly with strenuous recovery efforts for non-performing portfolio. Moreover, improvement of service quality standards and providing state- of-the-art banking services by leveraging technology and skilled human resources remain key priorities of the management.

Furthermore, the Bank plans to grow advances across all economic segments, i.e. Corporate, SMEs, Agriculture and Consumer financing. Simultaneously, target will be to further diversify and improve the deposits composition for reduction in the fund ing cost of the Bank.

Acknowledgments

The Board would like to thank the Provincial Government, State Bank of Pakistan, Shareholders, regulatory authorities and all other stakeholders for their continued trust and support. We are also grateful to our valued customers for their patronage and continued confidence in the Bank.

For and on behalf of the Board of Directors

Hassan Raza

Managing Director & CEO October 29, 2025 Peshawar

4

(Un-audited) (Audited)

September 30,

2025

December 31,

2024

NET ASSETS 22,848,141 21,899,219

22,848,141 21,899,219

CONTINGENCIES AND COMMITMENTS 22

The annexed notes 1 to 40 form an integral part of these condensed interim financial statements.

MANAGING DIRECTOR

CHIEF FINANCIAL OFFICER

DIRECTOR

_

________

DIRECTOR DIRECTOR

5

CONDENSED INTERIM STATEMENT OF PROFIT AND LOSS ACCOUNT (UN-AUDITED) FOR THE NINE MONTH PERIOD ENDED SEPTEMBER 30, 2025

Quarter ended Period ended

July 1 to

September 30,

2025

July 1 to

September 30,

2024

January 1 to

September 30,

2025

January 1 to

September 30,

2024

Note

--------- Rupees in '000 ---------

(Restated) (Restated)

The annexed notes 1 to 40 form an integral part of these condensed interim financial statements.

MANAGING DIRECTOR

CHIEF FINANCIAL OFFICER

DIRECTOR

_

________

DIRECTOR DIRECTOR

6

Quarter ended Period ended

--------------------- Rupees in '000 ---------------------

(Restated) (Restated)

Profit after taxation for the period 1,607,210 1,081,530 4,972,576 2,632,229

Other comprehensive income / (loss)

Items that may be reclassified to statement

of profit and loss account in subsequent periods:

Movement in surplus on revaluation of debt investments through FVOCI - net of tax

Gain on sale of debt investments carried at FVOCI

reclassified to profit and loss - net of tax

Deficit transferred to profit and loss on debt investment reclassified from FVOCI to FVPL- net of tax

Items that will not be reclassified to statement

of profit and loss account in subsequent periods:

Movement in surplus on revaluation of equity investments

- net of tax

Share of surplus on revaluation of investment of associate - net of tax

Share of remeasurement loss on defined benefit obligation of associate - net of tax

(311,800) 935,039 (431,604) 676,766

25,526 651 46,344 1,473

Total comprehensive income 1,320,936 2,017,220 4,587,316 3,310,468

The annexed notes 1 to 40 form an integral part of these condensed interim financial statements.

MANAGING DIRECTOR

CHIEF FINANCIAL OFFICER

DIRECTOR

_

________

DIRECTOR DIRECTOR

7

Share capital

Statutory reserve

Surplus / (deficit) on revaluation of

Investments Property and equipment

Non-banking assets

Unappropriated profit

Total

8

--------------------------------------------- Rupees in '000 ---------------------------------------------

Balance as at December 31, 2023 (audited)

Impact of adoption of IFRS 9 - net of tax (note 4.1)

Balance as at January 1, 2024 after adoption of IFRS 9

Profit after taxation for the nine month period ended September 30, 2024 - restated Other comprehensive income / (loss) - net of tax

Movement in deficit on revaluation of investments in debt instruments through FVOCI- net of tax Share of surplus on revaluation of investment of associate - net of tax

Share of remeasurement loss on defined benefit obligation of associate - net of tax Movement in surplus on revaluation of equity investments - net of tax

Total other comprehensive income - net of tax Transfer to statutory reserve

Transfer from surplus on revaluation of non-banking asset to unappropriated profit - net of tax

Transactions with owners, recorded directly in equity

Final cash dividend for the year ended December 31, 2023 (Rs.1.50 per share) Bonus shares issued for the year ended December 31, 2023 (Rs. 0.50 per share)

Balance as at September 30, 2024 (un-audited) - restated

Profit after taxation for the three month period ended December 31, 2024 Other comprehensive income / (loss) - net of tax

Movement in surplus on revaluation of investments in debt instruments through FVOCI- net of tax Share of surplus on revaluation of investments of associate - net of tax

Remeasurement gain on defined benefit obligations - net of tax

Share of remeasurement gain on defined benefit obligation of associate - net of tax

Gain on sale of debt investments carried at FVOCI reclassified to profit and loss - net of tax Movement in surplus on revaluation of equity investments - net of tax

Movement in deficit on revaluation of non-banking assets - net of tax Total other comprehensive income - net of tax

Transfer to statutory reserve

Transfer from surplus on revaluation of non-banking asset to unappropriated profit - net of tax Gain on disposal of equity investments at FVOCI transferred to unappropriated profit - net of tax Balance as at December 31, 2024 (audited)

Impact of adoption of IFRS 9 - net of tax (note 4.1.1)

Balance as at January 1, 2025 after adoption of IFRS 9

Profit after taxation for the nine month period ended September 30, 2025 Other comprehensive income / (loss) - net of tax

Movement in surplus on revaluation of investments in debt instruments through FVOCI - net of tax Gain on sale of debt investments carried at FVOCI reclassified to profit and loss - net of tax

Share of surplus on revaluation of investment of associate - net of tax Movement in surplus on revaluation of equity investments - net of tax

Movement of deficit on debt investment reclassified from FVOCI to FVPL- net of tax Total other comprehensive loss - net of tax

Transfer to statutory reserve

Transfer from surplus on revaluation of non-banking asset to unappropriated profit - net of tax

Gain on disposal of equity investments at FVOCI of associate transferred to unappropriated profit - net of tax

Transactions with owners, recorded directly in equity

Final cash dividend for the year ended December 31, 2024 (Rs.1.70 per share) Interim cash dividend for the year ending December 31, 2025 (Rs.1.50 per share)

Balance as at September 30, 2025 (un-audited)

___________

The annexed notes 1 to 40 form an integral part of these condensed interim financial statements.

11,027,905 4,343,001 (823,221) 900,120 47,723 4,805,756 20,301,284

- - 729,764 - - (1,949,528) (1,219,764)

11,027,905 4,343,001 (93,457) 900,120 47,723 2,856,228 19,081,520

- - - - - 2,632,229 2,632,229

- - 679,155 - - (916) 678,239

- 526,446 - - - (526,446) -

- - - - (6,050) 6,050 -

-

- - - - - (1,654,364) (1,654,364) 551,455 - - - - (551,455) -

11,579,360 4,869,447 585,698 900,120 41,673 2,761,326 20,737,624

- - - - - 982,892 982,892

-

- - 170,226 - (13,520) 21,997 178,703

- 196,578 - - - (196,578) -

- - - - (1,541) 1,541 -

- - (5,958) - - 5,958 -

11,579,360 5,066,025 749,966 900,120 26,612 3,577,136 21,899,219

- - 67,193 - - - 67,193 11,579,360 5,066,025 817,159 900,120 26,612 3,577,136 21,966,412

- - - - - 4,972,576 4,972,576

- - (385,260) - - - (385,260)

- 994,515 - - - (994,515) -

- - - - (4,059) 4,059 -

- - (3,791) - - 3,791 -

- - - - - (1,968,683) (1,968,683)

- - - - - (1,736,904) (1,736,904)

11,579,360 6,060,540 428,108 900,120 22,553 3,857,460 22,848,141

MANAGING DIRECTOR

CHIEF FINANCIAL OFFICER

DIRECTOR DIRECTOR DIRECTOR

CONDENSED INTERIM CASH FLOW STATEMENT (UN-AUDITED) FOR THE NINE MONTH PERIOD ENDED SEPTEMBER 30, 2025

January 1 to

September 30,

2025

January 1 to

September 30,

2024

Note

------- Rupees in '000 -------

(Restated)

MANAGING DIRECTOR

CHIEF FINANCIAL OFFICER

DIRECTOR

_

________

DIRECTOR DIRECTOR

9

NOTES TO THE CONDENSED INTERIM FINANCIAL STATEMENTS (UN-AUDITED) FOR THE NINE MONTH PERIOD ENDED SEPTEMBER 30, 2025

1. STATUS AND NATURE OF BUSINESS

   The Bank of Khyber (the Bank) was established in Pakistan under The Bank of Khyber Act, 1991 and is principally engaged in the business of commercial banking and related services. The Bank acquired the status of a scheduled bank in 1994 and is listed on the Pakistan Stock Exchange Limited. The registered office of the Bank is situated at 24-The Mall, Peshawar Can , Peshawar. The Bank operates 247 branches including 191 Islamic banking branches (December 31, 2024: 246 branches including 131 Islamic banking branches). Pursuant to the State Bank of Pakistan's (SBP) approval dated December 31, 2024, the Bank has converted 59 of its conventional banking branches into Islamic banking branches during the period. The long term credit rating of the Bank assigned by VIS Credit Rating Company Limited and Pakistan Credit Rating Agency Limited (PACRA) are 'AA-' and 'A+' respectively (December 31, 2024: 'A+' and 'A+' respectively) and the short-term credit ratings assigned are 'A-1' (A-One) and 'A-1' (A-One) respectively (December 31, 2024: 'A1' (A-One) and 'A-1' (A-One) respectively). The majority shares (i.e. 70.20%) of the Bank are held by Government of Khyber Pakhtunkhwa (GoKP).

   The Provincial Assembly of Khyber Pakhtunkhwa has passed the Bank of Khyber (Amendment) Act, 2022. As part of the amendments, the name of Bank has been changed from Bank of to of The Bank is in the process of seeking necessary regulatory approval for the same.

2. BASIS OF PREPARATION

   1. In accordance with the directives of the Federal Government regarding the shifting of the banking system to Islamic modes, the State Bank of Pakistan (SBP) has issued various circulars from time to time. Permissible forms of trade-related modes of financing include purchase of goods by the banks from their customers and immediate resale to them at appropriate profit in price on deferred payment basis. The purchases and sales arising under the respective arrangements (except for Murabaha financings accounted for under Islamic Financial Accounting Standard - 1 "Murabaha") are not reflected in these condensed interim financial statements as such, but are restricted to the amount of facility actually utilized and the appropriate portion of profit thereon.

   2. The Islamic banking branches of the Bank have complied with the requirements as set out in the Islamic Financial Accounting Standards (IFAS), issued by the Institute of Chartered Accountants of Pakistan (lCAP) as are notified under the provisions of Companies Act, 2017.

   3. The financial results of the Islamic Banking Branches have been included in these condensed interim financial statements for reporting purposes, after eliminating the effects of inter-branch transactions and balances. Key financial figures of the Islamic Banking Branches are disclosed in note 38 to these condensed interim financial statements.

   4. These condensed interim financial statements have been prepared under the historical cost convention except that certain class of property and equipment and non-banking assets acquired in satisfaction of claims are stated at revalued amounts; certain investments classified at fair value through profit or loss and fair value through other comprehensive income are stated at fair value; staff loans are measured at fair value at initial recognition; and the recognition of certain employees benefits, lease liabilities and corresponding right of use assets at present value, as disclosed in their respective notes.

   5. The Bank believes that there is no significant doubt on the Bank's ability to continue as a going concern. Therefore, these condensed interim financial statements have been prepared on a going concern basis.

   6. These condensed interim financial statements have been presented in Pakistani Rupee, which is the Bank's functional and presentation currency. The figures have been rounded off to the nearest thousand rupees, unless otherwise stated.

      10

      
      
      

      NOTES TO THE CONDENSED INTERIM FINANCIAL STATEMENTS (UN-AUDITED) FOR THE NINE MONTH PERIOD ENDED SEPTEMBER 30, 2025

      NOTES TO THE CONDENSED INTERIM FINANCIAL STATEMENTS (UN-AUDITED) FOR THE NINE MONTH PERIOD ENDED SEPTEMBER 30, 2025

3. STATEMENT OF COMPLIANCE

   1. These condensed interim financial statements have been prepared in accordance with the accounting and reporting standards as applicable in Pakistan for interim financial reporting. The accounting and reporting standards as applicable in Pakistan for interim financial reporting comprise of:

      • International Accounting Standard (IAS) 34, 'Interim Financial Reporting', and International Financial Reporting Standards (IFRS) issued by the International Accounting Standards Board (IASB) as are notified under the Companies Act, 2017;

      • Islamic Financial Accounting Standards (IFAS) issued by the Institute of Chartered Accountants of Pakistan (ICAP) as are notified under the Companies Act, 2017;

      • Provisions of and directives issued under the Banking Companies Ordinance, 1962 and the Companies Act, 2017; and

      • Directives issued by the State Bank of Pakistan (SBP) and the Securities and Exchange Commission of Pakistan (SECP).

        Whenever the requirements of the Banking Companies Ordinance, 1962, the Companies Act, 2017 or the directives issued by the SBP and the SECP differ with the requirements of IAS 34 or IFAS, the requirements of the Banking Companies Ordinance, 1962, the Companies Act, 2017 and the said directives, shall prevail.

   2. The disclosures made in these condensed interim financial statements have been limited based on the format prescribed by the SBP vide BPRD Circular Le er No. 2 dated February 9, 2023 and IAS 34. These condensed interim financial statements do not include all the information and disclosures required in the audited annual financial statements, and should be read in conjunction with the audited annual financial statements for the year ended December 31, 2024.

   3. SBP vide BSD Circular Le er No. 10, dated August 26, 2002, has deferred the applicability of International Accounting Standard (IAS) 40, Investment Property for banking companies till further instructions. Moreover, SBP vide BPRD Circular No. 4, dated February 25, 2015, has deferred the applicability of Islamic Financial Accounting Standards (IFAS) 3, Profit and Loss Sharing on Deposits. Further, according to the notification of the SECP issued vide SRO 411(I)/2008 dated April 28, 2008, International Financial Reporting Standard (IFRS) 7, 'Financial Instruments: Disclosures' has not been made applicable for banks. Accordingly, the requirements of these standards have not been considered in the preparation of these condensed interim financial statements.

   4. Standards, interpretations of and amendments to published accounting and reporting standards that are effective in the current period

      There are certain new and amended standards, issued by International Accounting Standards Board (IASB), interpretations and amendments that are mandatory for the Bank's accounting periods beginning on or after January 1, 2025 but are considered not to be relevant or do not have any material effect on the Bank's financial statements and therefore are not detailed in these condensed interim financial statements. The impact of IFRS 9 for the current period is disclosed in note 4.1.1 to these condensed interim financial statements. Further, the comparative period has been restated to incorporate the impact of adoption of IFRS 9 as disclosed in note 4.1 to these condensed interim financial statements.

      11

      
      
      

      NOTES TO THE CONDENSED INTERIM FINANCIAL STATEMENTS (UN-AUDITED) FOR THE NINE MONTH PERIOD ENDED SEPTEMBER 30, 2025

      NOTES TO THE CONDENSED INTERIM FINANCIAL STATEMENTS (UN-AUDITED) FOR THE NINE MONTH PERIOD ENDED SEPTEMBER 30, 2025

   5. Standards, interpretations of and amendments to published accounting and reporting standards that are not yet effective

      There are certain new and amended standards, issued by International Accounting Standards Board (IASB), interpretations and amendments that are mandatory for the Bank's accounting periods beginning on or after January 1, 2026 but are considered not to be relevant or will not have any material effect on the Bank's financial statements except for:

      • IFRS 18 'Presentation and Disclosure in Financial Statements' (published in April 2024) with applicability date of January 1, 2027 by IASB. IFRS 18 is yet to be adopted in Pakistan. IFRS 18 when adopted and applicable shall impact the presentation of 'Statement of Profit and Loss Account' with certain additional disclosures in the condensed interim financial statements.

      • Amendments to IFRS 9 'Financial Instruments' which clarify the date of recognition and derecognition of a financial asset or financial liability including se lement of liabilities through banking instruments and channels including electronic transfers. The amendment when applied may impact the timing of recognition and derecognition of financial liabilities.

      • Amendment to IAS 21 'The Effects of Changes in Foreign Exchange Rates' which will require Banks to apply a consistent approach in assessing whether a currency can be exchanged into another currency and, when it cannot, in determining the exchange rate to use and the disclosures to provide.

4. MATERIAL ACCOUNTING POLICY INFORMATION

   The material accounting policies applied in the preparation of these condensed interim financial statements are consistent with those applied in the preparation of the annual audited financial statements of the Bank for the year ended December 31, 2024. Impacts of adoption of IFRS 9 for comparative and current period are disclosed in note

   1. below.

      1. IFRS 9 - 'Financial Instruments'

         The Bank had adopted IFRS 9 effective from January 1, 2024 with modified retrospective approach for restatement permi ed under IFRS 9. The cumulative impact of initial application amounting to Rs. 1,219.76 million net of tax was recorded as an adjustment to equity at the beginning of the previous accounting period.

         The Bank, in compliance with extended timelines prescribed in SBP's BPRD Circular Le er No. 16 dated July 29, 2024 and BPRD Circular Le er No. 1 dated January 22, 2025 had incorporated IFRS 9 related impacts of fair valuation of subsidised staff loans in the last quarter of 2024. Therefore, the condensed interim statement of profit and loss account (un-audited) for the nine month ended September 30, 2024 have been restated to incorporate these impacts. Had the restatement not been incorporated the profit after tax and total comprehensive income for the half year ended September 30, 2024 would have been lower by Rs. 33.13 million. The details are tabulated below:

         Financial statement line items

         Rupees in '000

         Description

         Mark-up/ return/ interest earned Operating expenses

         Net loss on derecognition of financial assets measured at amortised cost

         217,585

         (128,302) Impact of fair valuation of subsidised staff loans

         (24,318)

         64,965

         Taxation

         Net impact on profit after tax

         Net impact on Earnings Per Share (EPS)

         (31,833)

         33,132

         Rupee

         0.029

         Tax impact of restatement

         EPS impact of restatement

         12

         
         
         

         NOTES TO THE CONDENSED INTERIM FINANCIAL STATEMENTS (UN-AUDITED) FOR THE NINE MONTH PERIOD ENDED SEPTEMBER 30, 2025

NOTES TO THE CONDENSED INTERIM FINANCIAL STATEMENTS (UN-AUDITED) FOR THE NINE MONTH PERIOD ENDED SEPTEMBER 30, 2025

The financial risk management objectives and policies adopted by the Bank are consistent with those disclosed in the annual audited financial statements for the year ended December 31, 2024.

(Un-audited) (Audited)

September 30, December 31,

1. CASH AND BALANCES WITH TREASURY BANKS

   In hand

   2025 2024

   -------- Rupees in '000 --------

   Local currency	6,756,572	5,968,029
   Foreign currencies	156,401	186,814
   	6,912,973	6,154,843
   With State Bank of Pakistan in
   Local currency current accounts	16,534,046	15,258,838
   Foreign currency current accounts	28,104	25,943
   Foreign currency deposit accounts	300,219	257,275
   	16,862,369	15,542,056
   With National Bank of Pakistan in
   Local currency current accounts	3,172,225	1,294,874
   Local currency deposit accounts	389,298	995,058
   Foreign currency current accounts	2,775	4,436
   	3,564,298	2,294,368
   Prize bonds	490	1,854
   Less: Credit loss allowance held against cash and balances with treasury banks	(11)	(26)

   Cash and balances with treasury banks - net of credit loss allowance 27,340,119 23,993,095

   13

   
   
   

   NOTES TO THE CONDENSED INTERIM FINANCIAL STATEMENTS (UN-AUDITED) FOR THE NINE MONTH PERIOD ENDED SEPTEMBER 30, 2025

NOTES TO THE CONDENSED INTERIM FINANCIAL STATEMENTS (UN-AUDITED) FOR THE NINE MONTH PERIOD ENDED SEPTEMBER 30, 2025

(Un-audited) (Audited)

Note

September 30,

2025

December 31,

2024

1. BALANCES WITH OTHER BANKS

In Pakistan

-------- Rupees in '000 --------

14

NOTES TO THE CONDENSED INTERIM FINANCIAL STATEMENTS (UN-AUDITED) FOR THE NINE MONTH PERIOD ENDED SEPTEMBER 30, 2025

NOTES TO THE CONDENSED INTERIM FINANCIAL STATEMENTS (UN-AUDITED) FOR THE NINE MONTH PERIOD ENDED SEPTEMBER 30, 2025

(Un-audited)

1. INVESTMENTS September 30, 2025

   1. Investments by type:

      Cost / amortised cost

      Credit loss allowance

      Surplus / (deficit)

      Carrying value

      --------------Rupees in '000--------------

      Fair value through profit or loss (FVPL)

      Non-Government Debt Securities 1,364,720 - (15,459) 1,350,911

      Fair value through other comprehensive income (FVOCI)

      Federal Government Securities	252,790,609	-	1,769,663	254,560,272
      Shares	677,080	-	(229,393)	447,687
      Non-Government Debt Securities	4,901,631	(145,767)	(101,809)	4,652,405
      	258,367,670	(145,767)	1,438,461	259,660,364
      Amortised cost (AC) Federal Government Securities	20,884,715	-	-	20,884,715
      Associate	117,490	-	-	117,490
      Total investments	280,736,245	(145,767)	1,423,002	282,013,480

      (Audited) December 31, 2024

      Cost / amortised cost

      Credit loss allowance

      Surplus / (deficit)

      Carrying value

      -------------Rupees in '000-------------

      Fair value through profit or loss (FVPL)

      Federal Government Securities Non-Government Debt Securities

      5,367	-	(5)	5,362
      1,064,760	-	(13,809)	1,050,951

      1,070,127 - (13,814) 1,056,313

      Federal Government Securities	255,339,267	-	2,659,286	257,998,553
      Shares	677,081	-	(463,139)	213,942
      Non-Government Debt Securities	5,428,308	(158,189)	(92,254)	5,177,865
      	261,444,656	(158,189)	2,103,893	263,390,360
      Amortised cost (AC)
      Federal Government Securities	18,217,573	-	-	18,217,573
      Associate	102,351	-	-	102,351
      Total investments	280,834,707	(158,189)	2,090,079	282,766,597
      			(Un-audited)	(Audited)
      			September 30,	December 31,
      			2025	2024
      Investments given as collateral Note ------- Rupees in '000 --------
      Market Treasury Bills			18,353,000	3,692,167
      Pakistan Investment Bonds			38,000,000	109,498,432
      Ijara Sukuks			-	4,057,905
      	8.2.1		56,353,000	117,248,504

      Fair value through other comprehensive income (FVOCI)

   2. 1. The market value of securities given as collateral is Rs. 53,783.75 million (December 31, 2024: Rs 117,262.46 million)

         15

         
         
         

         NOTES TO THE CONDENSED INTERIM FINANCIAL STATEMENTS (UN-AUDITED) FOR THE NINE MONTH PERIOD ENDED SEPTEMBER 30, 2025

NOTES TO THE CONDENSED INTERIM FINANCIAL STATEMENTS (UN-AUDITED) FOR THE NINE MONTH PERIOD ENDED SEPTEMBER 30, 2025

(Un-audited) (Audited)

September December

1. ADVANCES Performing Non performing Total

   Note

   (Un-audited) September 30,

   2025

   (Audited) December 31,

   2024

   (Un-audited) September 30,

   2025

   (Audited) December 31,

   2024

   (Un-audited) September 30,

   2025

   (Audited) December 31,

   2024

   Loans, cash credits, running finances, etc. Islamic financing and related assets

   Bills discounted and purchased

   ------------Rupees in '000------------

   71,901,195		128,245,818		10,025,275		9,756,779		81,926,470		138,002,597
   51,735,651		19,920,768		2,082,741		2,002,824		53,818,392		21,923,592
   99,878		155,174		219,630		1,541,365		319,508		1,696,539

   123,736,724			148,321,760		12,327,646 13,300,968				136,064,370		161,622,728
   Impact of fair valuation and modification of advances		(1,925,394)		(1,999,125)		-		-		(1,925,394)		(1,999,125)
   Advances - gross		121,811,330		146,322,635		12,327,646		13,300,968		134,138,976		159,623,603
   Credit loss allowance against advances	9.3
   - Stage 1		685,442		731,140		-		-		685,442		731,140
   - Stage 2		546,897		584,619		-		-		546,897		584,619
   - Stage 3		-		-		10,580,874		11,425,873		10,580,874		11,425,873
   		1,232,339		1,315,759		10,580,874		11,425,873		11,813,213		12,741,632
   Advances - net of credit loss allowance		120,578,991		145,006,876		1,746,772		1,875,095		122,325,763		146,881,971
   										(Un-audited) September 30,		(Audited) December 31,

   1. Particulars of advances (gross)

      2025 2024

      18

      ------ Rupees in '000 ------

      In local currency In foreign currencies	134,138,976 -	159,623,603 -
      	134,138,976	159,623,603

      
      
      

      NOTES TO THE CONDENSED INTERIM FINANCIAL STATEMENTS (UN-AUDITED) FOR THE NINE MONTH PERIOD ENDED SEPTEMBER 30, 2025

Stage 1

Stage 2 Stage 3

Total

Stage 1 Stage 2

Stage 3

Total

-------------------- Rupees in '000 --------------------

NOTES TO THE CONDENSED INTERIM FINANCIAL STATEMENTS (UN-AUDITED) FOR THE NINE MONTH PERIOD ENDED SEPTEMBER 30, 2025

NOTES TO THE CONDENSED INTERIM FINANCIAL STATEMENTS (UN-AUDITED) FOR THE NINE MONTH PERIOD ENDED SEPTEMBER 30, 2025

9.4.1

9.4.2

4,142,156

125,261

21

10.2 Additions to property and equipment

(Un-audited)

For the nine months ended

The following additions have been made to property and equipment during the period:

September 30,

2025

September 30,

2024

------ Rupees in '000 ------

September 30,

2025

December 31,

2024

11 RIGHT-OF-USE ASSETS ------ Rupees in '000 ------

22

NOTES TO THE CONDENSED INTERIM FINANCIAL STATEMENTS (UN-AUDITED) FOR THE NINE MONTH PERIOD ENDED SEPTEMBER 30, 2025

(Un-audited)

For the nine months ended

September 30, September 30,

2025 2024

No intangible assets were disposed off during the periods ended September 30, 2025 and September 30, 2024.

(Un-audited) (Audited)

September 30, December 31,

13 DEFERRED TAX ASSETS

2025 2024

------ Rupees in '000 ------

23

(Un-audited) (Audited)

September 30,

2025

December 31,

2024

24

(Un-audited) (Audited)

16 BORROWINGS

September 30,

2025

December 31,

2024

Secured

Borrowings from State Bank of Pakistan (SBP) under:

------ Rupees in '000 ------

• Export refinance scheme 2,982,700 3,552,700

• Long term financing facility 2,522,651 3,038,577

• Refinance and credit guarantee scheme for women entrepreneurs 53,137 54,981

• Financing facility for renewable energy 219,897 265,478

• Refinance facility for modernization of Small and Medium Enterprises (SMEs) 83,359 53,976

• Refinance facility for combating COVID-19 226,993 428,627

• SME Asaan Scheme (SAAF) 407,508 799,615

• Financing facility for storage of agriculture produce 73,000 89,384

• Repurchase agreement borrowings 53,999,412 91,064,600

• Acceptance mudarbah - 4,057,905

60,568,657 103,405,843

Repurchase agreement borrowings 342,655 22,125,999

Total secured 60,911,312 125,531,842

Unsecured

Call borrowings 1,000,000 6,000,000

Bai Muajjal borrowings - 1,999,929

Total 61,911,312 133,531,771

17 DEPOSITS AND OTHER ACCOUNTS

(Un-audited) (Audited)

September 30, 2025 December 31, 2024

In local currency

In foreign currencies

Total In local

currency

In foreign currencies

Total

Customers Current deposits Saving deposits Term deposits Others

Financial Institutions Current deposits Saving deposits

-------------------------------- Rupees in '000 --------------------------------

370,648,267 1,640,803 372,289,070 274,070,032 1,650,778

2,020,042 31,322 2,051,364 1,889,949 31,230

372,668,309 1,672,125 374,340,434 275,959,981 1,682,008

275,720,810

1,921,179

277,641,989

(Un-audited) (Audited)

September 30, December 31,

18 LEASE LIABILITIES

2025 2024

------ Rupees in '000 ------

25

NOTES TO THE CONDENSED INTERIM FINANCIAL STATEMENTS (UN-AUDITED) FOR THE NINE MONTH PERIOD ENDED SEPTEMBER 30, 2025

18.2 The Bank mainly has lease contracts for real estate that are used in its operations including branches and other offices. Leases generally have lease terms between 1.5 years to 5 years. The Bank's obligations correspond to the lessor's title to the leased assets. Generally, the Bank is restricted from assigning and subleasing the lease assets. As a practical expedient, management does not separate lease and non-lease components, wherever applicable. The additions to lease obligations during the period have been discounted at rates ranging between 11.09% to 12.24% (December 31, 2024: 13.47% to 22.09%) per annum; being the relevant incremental borrowing rate of the Bank.

(Un-audited) (Audited)

26

1. SHARE CAPITAL

   1. Authorized capital

      (Un-audited) (Audited) (Un-audited) (Audited)

      September 30,

      December 31,

      September 30,

      December 31,

      2025 2024

      Number of shares

      2025 2024

      ----- Rupees in '000 -----

      1,500,000,000 1,500,000,000 Ordinary shares of Rs. 10 each 15,000,000 15,000,000

   2. Issued, subscribed and paid up

      (Un-audited) (Audited) (Un-audited) (Audited)

      September 30,

      December 31,

      September 30,

      December 31,

      2025 2024 2025 2024

      Number of shares ----- Rupees in '000 -----

      722,698,448		722,698,448	Ordinary shares of Rs. 10 each Fully paid in cash	7,226,984	7,226,984
      			Issued as fully paid bonus shares:
      435,237,541		380,092,081	Opening balance	4,352,376	3,800,921
      -		55,145,460	Issued during the period / year (Note 20.3)	-	551,455
      435,237,541		435,237,541	Closing balance	4,352,376	4,352,376
      1,157,935,989		1,157,935,989		11,579,360	11,579,360

   3. In the year 2024, 55,145,460 shares were issued as fully paid bonus shares in respect of the year ended December 31, 2023.

   4. The Bank has only one class of shares and at reporting date, the Government of Khyber Pakhtunkhwa and Ismail Industries Limited held 812,893,803 (December 31, 2024: 812,893,803) and 282,852,969 (December 31, 2024: 282,852,969) ordinary shares respectively. Moreover, the Bank has no reserved shares under options.

      (Un-audited) (Audited)

2. SURPLUS ON REVALUATION OF ASSETS

September 30,

2025

December 31,

2024

------ Rupees in '000 ------

27

NOTES TO THE CONDENSED INTERIM FINANCIAL STATEMENTS (UN-AUDITED) FOR THE NINE MONTH PERIOD ENDED SEPTEMBER 30, 2025

(Un-audited) (Audited)

September 30, December 31,

2025 2024

Note ------ Rupees in '000 ------

Commitments for acquisition of:

• Property and equipment 74,081 326,857

• Intangible assets 138,276 76,102

Other commitments - -

19,732,653 13,262,517

22.2.1 Commitments in respect of forward foreign exchange contracts

Purchase 2,880,526 1,102,151

Sale 3,095,051 1,767,081

5,975,577 2,869,232

Commitments for outstanding forward foreign exchange contracts are disclosed in these condensed interim financial statements at contracted rates.

28