Quarter 5 financial statement for 2024

NPF MICROFINANCE BANK PLC

RC. 220824

ANNUAL REPORTS AND ACCOUNTS

31 DECEMBER 2024

NPF Microfinance Bank PLC

Annual Report and Financial Statements

For the year ended 31 December 2024

Contents

Page

Corporate information 3

Directors' report 4

Statement of directors' responsibilities 11

Statement of corporate responsibility 12

Report of the statutory audit committee 13

Management's annual assessment of, and report on NPF Microfinance Bank Plc's

Internal Control over financial reporting 14

Certification of Management's assessment on Internal Control Over Financial Reporting 15

Corporate governance report 17

Independent auditor's report 26

Independent auditor's report on assurance report on management's assessment of

controls over financial reporting 31

Statement of financial position 33

Statement of profit or loss and other comprehensive income 34

Statement of changes in equity 35

Statement of cash flows 36

Notes to the financial statements 37

Other national disclosures:

Value added statement 102

Financial summary 103

For the year ended 31 December 2024

Corporate Information Directors: Company Secretary: Registered Office:

Mr. Damilola Samuel Adegbuyi CP( Rtd)* Mr. Habeeb Amuda Yusuf **

Mr. John Kwabe Tizhe

Mrs. Olamide Mojisola Akin - Balogun*** Mr. Said Umar Fagge (ACP)

Mr. Oyeyemi Adesoye Oyediran (AIG) psc, fsi Mr. Mohammed D. Saeed*

Mr. Aminu Saleh Pai**

Mrs. Lydia Ameh Enemona (CSP)

Mr. Idrisu Dabban Dauda (AIG) psc, fdc, mnim (Rtd) **** Mr. Mutalib Atanda Akinlade, MBA, FCA ****

Barr. Aduojo Friday Abah Esq. ****

Barr Felix Sunday Chukwurah *****

*Appointed on 1 February 2024 and made Chairman of the Board on 13 June 2024

** Appointed Managing Director on 13 June 2024

***Appointed Executive Director Finance & Administration on 1 February 2024

**** Appointed on 1 February 2024

***** Appointed on 19 July 2024

Mrs. Osaro J. Idemudia

Aliyu Atta House

1, Ikoyi Road, Obalende Lagos

Aliyu Atta House

1, Ikoyi Road, Obalende Lagos

Independent Auditor: Deloitte & Touche

Civic Towers

Plot GA 1, Ozumba Mbadiwe Avenue, Victoria Island,

Lagos, Nigeria.

Major Bankers: Registrars: Tax Identification Number:

United Bank for Africa Plc 57 Marina, Lagos Island, Lagos, Nigeria.

Zenith Bank Plc

Plot 84, Ajose Adeogun Street, Victoria Island,

Lagos, Nigeria.

Sterling Bank Plc 20 Marina Road, Lagos Island, Lagos.

First Bank of Nigeria Limited Samuel Asabia House

35 Marina

Lagos, Nigeria.

CardinalStone Registrars Limited 335/337, Herbert Macaulay Way Yaba, Lagos

00122558-0001

Chairman Managing Director Executive Director Executive Director Non-Executive Director Non-Executive Director Non-Executive (Independent) Director Non-Executive Director Non-Executive Director Non-Executive Director Non-Executive (Independent) Director Non-Executive (Independent) Director Non-Executive Director

NPF Microfinance Bank PLC

Annual Report and Financial Statements

For the year ended 31 December 2024

DIRECTORS' REPORT

The Directors are pleased to present to members their report on the affairs of NPF Microfinance Bank Plc, together with the Bank's audited financial statements and the Auditor's report for the financial year ended 31 December 2024.

1) LEGAL FORM AND PRINCIPAL ACTIVITIES

The Bank was incorporated in Nigeria as a Private Limited Liability Company on 19 May 1993 under the provisions of the Companies and Allied Matters Act (CAMA) with RC No. 220824. It obtained a provisional license as a Community Bank from the Central Bank of Nigeria on 12 July 1993 with License No. FC 00200 and commenced operations on 20 August 1993. It obtained a final license from the Central Bank of Nigeria on 24 January 2002. It was registered as a Public Limited Company on 13 July 2006. The Bank was given an approval-in-principle to operate as a Microfinance Bank on 10 May 2007 and obtained the final license on 4 December 2007. The shares of the Bank were listed on the Nigerian Stock Exchange on 1 December

The principal activity of the Bank is the provision of banking and other permissible financial services to poor and low income households and micro enterprises with emphasis on members of the Nigerian Police Community. Such services include retail banking, loans and advances and other allied services.

The Bank currently has 49 branches nationwide from which it operates.

2) OPERATING RESULTS

Highlights of the Bank's operating results for the year ended 31 December 2024 are as follows:

In thousands of naira

31-Dec-2024 31-Dec-2023

The Board of Directors recommended a cash dividend of 15 kobo per share (issue and paid up shares) for the year ended 31 December 2024 (31 December 2023: 12 kobo). This is subject to approval at the Annual General Meeting. Payment of dividends is subject to withholding tax at a rate of 10% in the hand of recipients.

4) DIRECTORS

The Directors who served during the year unbder review are listed below:-

For the year ended 31 December 2024

DIRECTORS' REPORT - continued

• 5) DIRECTORS' INTEREST IN SHARES

  The interest of Directors who currently serve on the Board in the issued share capital of the Bank as recorded in the Register of members during the financial year under review and/or as notified by the Directors for the purposes of Sections 301 of the Companies and Allied Matters Act (CAMA), 2020 and the listing requirements of the Nigerian Exchange Limited are as follows:

  31 December 2024	31 December 2023
  NAME OF DIRECTOR	DIRECT	INDIRECT	DIRECT	INDIRECT
  (units)	(units)	(units)	(units)
  Otunba Damilola Samuel Adegbuyi	-	-	-	-
  Mr. Oyeyemi Adesoye Oyediran *	-	3,753,230,767	-	3,761,322,655
  Mr. Idrisu Dabban Dauda	12,035	-	12,035	-
  Cheif Sunday Felix Chukwurah.	-	-	-	-
  Mr. Mutalib Atanda Akinlade	-	-	-	-
  Mr. Said U Fagge	-	-	-	-
  Barr. Aduojo Friday Abah.	-	-	-	-
  Mrs. Lydia Enemona Ameh**	936,149,939	936,149,939
  Mr. Habeeb Amuda Yusuf	10,535,128	-	4,732,931	-
  Mr. John Kwabe Tizhe	3,917,487	-	1,917,487	-
  Mrs Olamide Akin -Balogun	-	-	-	-

  *Mr. Oyeyemi Oyediran and Mr. Said Umar Fagge represents the interest of the Nigerian Police Cooperative Multipurpose Society Limited, which owns 3,753,230,767 (31 December 2023: 3,761,322,655) ordinary shares of 50k each in the issued share capital of the Bank for the year under review.

  **Mrs. Lydia Enemona Ameh represents the interest of the Nigeria Police Welfare Insurance Society (NPWIS) which owns 936,149,939 (31 December 2023: 936,149,939) ordinary shares of 50k each in the issued share capital of the Bank for the year under review.

  Save as disclosed above, none of the directors notified the Bank of any disclosable interest in the Bank's share capital as at 31 December 2024. The Directors' interest in shares remained the same as at the date the 2024 audited financial statements was approved by the Board of Directors.

• 6) DIRECTORS' INTEREST IN CONTRACTS

  None of the Directors notified the Bank for the purpose of Section 303 of the Companies and Allied Matters Act (CAMA), 2020 of any direct or indirect interest in any contract or proposed contract with the Bank in the year 2024.

• 7) CHANGES TO THE BOARD

  There has been no changes on the Board since the last Annual General Meeting

For the year ended 31 December 2024

DIRECTORS' REPORT - continued

• 8) SUBSTANTIAL INTEREST IN SHARES

  According to the Register of Members as at 31 December 2024, the following shareholders of the Bank held more than 5% of the issued ordinary share capital of the Company:

  31 December 2023	31 December 2024
  Shareholder	No. of Shares	Shareholding (%)	No. of Shares	Shareholding (%)
  Nigeria Police Co-operative Society Limited	3,761,322,655	62.76	3,753,230,767	62.63
  NPF Welfare Insurance Scheme	936,149,939	15.62	936,149,939	15.63

  In line with the Nigeria Exchange Limited (NGX) rules on the requirement for all listed companies to maintain a minimum free float of 20%, the issued Share capital of the Bank in free float is 21.51% as at 31 December 2024 (31 December 2023: 20. 28%) .

• 9) ANALYSIS OF SHAREHOLDING

  The shareholding structure of the Bank is as stated below:

  As at 31 December 2023

As at 31 December 2024

Holders

• 10) SHARE CAPITAL HISTORY

  The following changes have taken place in the Bank's authorised and issued capital since incorporation.

  DATE ISSUED	AUTHORISED	ISSUED & FULLY PAID	NOMINAL VALUE	REMARKS
  FROM	TO	FROM	TO
  ₦'000	₦'000	₦'000	₦'000	₦
  1993	500	500	-	-	1.00	CASH & KIND
  1996	500	30,000	-	17,976	1.00	CASH
  1999	-	30,000	17,996	21,571	1.00	BONUS 1:4
  2000	30,000	80,000	21,571	40,186	1.00	CASH
  2001	-	80,000	40,186	58,624	1.00	CASH
  2002	80,000	250,000	-	58,624	1.00	CASH
  2003	-	250,000	-	58,624	1.00	CASH
  2004	-	250,000	58,624	239,958	1.00	BONUS 1:10 & CASH
  2005	250,000	500,000	239,958	239,958	1.00	-
  2006	500,000	1,000,000	239,958	259,955	1.00	BONUS 1:12
  2007	1,000,000	2,000,000	259,955	417,192	1.00	CASH
  2008	-	2,000,000	-	417,192	1.00	-
  2009	-	2,000,000	417,192	1,143,328	1.00	CASH
  2010	-	2,000,000	1,143,328	-	0.50	SHARE-SPLIT 1:2
  2011	-	2,000,000	1,143,328	-	0.50	SHARE-SPLIT 1:2
  2012	-	2,000,000	1,143,328	-	0.50	-
  2013	-	2,000,000	1,143,328	-	0.50	-
  2014	2,000,000	3,000,000	1,143,328	-	0.50	-
  2015	-	3,000,000	1,143,328	-	0.50	-
  2016	-	3,000,000	1,143,328	-	0.50	-
  2017	-	3,000,000	1,143,328	-	0.50	-
  2018	-	3,000,000	1,143,328	-	0.50	-
  2019	-	3,000,000	1,143,328	-	0.50	-
  2020	-	3,000,000	1,143,328	-	0.50	-
  2021	3,000,000	6, 000, 000	1,143,328	2,696,829	0.50	PUBLIC OFFER/RIGHTS ISSUES
  2022 - Till Date	-	6, 000,000	2,696,829	2,996,447	0.50	BONUS 1:9

• 11) PROPERTY AND EQUIPMENT

  Information relating to changes in the Bank's property and equipment is given in Note 21 of the financial statements.

• 12) DONATIONS

  As part of our commitment to the development of our primary community and to identify with the aspirations of various sections of the society, the Bank made contributions to charitable and non-political organisations amounting to ₦8,615,000.00 (31 December 2023: ₦711,923) during the year. This comprises contributions to educational organisations amongst others as listed below:

  Donations made during the year ended 31 December 2024 are as follows:

The following donations were made during the year ended 31 December 2023.

₦

Pacelli School for the Blind, Lagos

100,000

Police Children Schools (Akure, Challenge, Initoro, Epe, Idimu, Ikeja, Enugu, etc) Nigeria Police Widows Association, Lagos

310,000

20,000

NPF Educational Research and Planning Police College, Ikeja

15,000

50,000

Police Secondary Schools (Akure, Abeokuta) Orphanage Home

140,000

76,923

711,923

• 13) FRAUD AND FORGERIES

  Actual Loss to the Bank

  Nature of Fraud	No. of Incidence	Fraud Amount (₦)	(₦)
  2024	2023	2024	2023	2024	2023
  Perpetrated by staff	8	3	7,994,200	4,204,580	-	1,832,080
  ATM Electronic Fraud	-	-	-	-	-	-
  Total	8	3	7,994,200	4,204,580	-	1,832,080

  1,832,080

  -

  1,832,080

  Perpetrated by staff

  The sum of ₦7,994,200 has been recovered from the fraud perpetrated by staff. This represents 100% recovery of the total fraud amount.

• 14) EVENTS AFTER THE REPORTING PERIOD

  There were no subsequent events which could have a material effect on the financial position of the Bank as at 31 December 2024 or the profit for the year then ended on that date, that have not been adequately provided for or disclosed in the financial statements.

• 15) HUMAN RESOURCES

  EMPLOYMENT OF DISABLED PERSONS

  The Bank recognises that its Employees are the most valuable assets in the organisation thus, the recruitment strategy is to ensure that qualified and competent candidates are engaged and retained to promote the Bank's corporate goals.

  The Bank maintains a fair policy in considering job applications from physically challenged persons, having regard to their abilities. In the event of any member of staff becoming physically challenged, every effort will be made to ensure that their employment with the Bank continues and that appropriate training is arranged. It is the policy of the Bank that the training, career development and promotion of disabled persons should, as far as possible, be identical with those of other employees. The Bank did not employ any physically challengd person during the year.

  EMPLOYEE INVOLVEMENT AND TRAINING

  The Bank ensures through various fora that employees are informed on matters concerning them. Formal channels are employed in communication with employees with an appropriate feedback mechanism.

  The Bank recognises training of its human resources as an investment which adds value to the business. We are therefore committed to continuos development of our workforce through courses and seminars organised internally and externally. Individual needs of each employees are considered in organising training courses. Members of staff are also encourged and assisted finacially to embark on certifications which will improve them academically and professionally. The Bank leveraged more on virtual trainings of staff for both internal and external trainings in the year under review.

HEALTH, SAFETY AND WELFARE OF EMPLOYEES

NPF Microfinance Bank Plc is committed to priortising the safety, health and well being of her Employees. Inspite of maintaining different businness premises across the country, the premises are designed with a view to guarantee the safety and healthy working conditions of her employees amd customers alike. Employees are adequately insured against occupational and other hazards. Also, fire prevention and fire fighting equipments are installed in strategic locations within the Bank's premises.

The Bank also provides medical insurance cover for staff and their immediate family members in line with the Bank's

16) RESEARCH AND DEVELOPMENT

The Research and development unit of the Bank carries out research into new banking products and services to anticipate and meet customers' needs and ensure excellent service is delivered at all times.

17) DIVERSITY AND INCLUSION

At NPF Microfinance Bank Plc, we understand that for us to thrive and achieve our vision to be the clear leader in the provision of Microfinance services, we must build a diverse and inclusive workforce that reflects the totality of our customer base. The Bank operates a non-discrimatory policy in the consideration of applications for employment. The Bank seeks to achieve an appropriate mixture of female representation at the top managment level. Though this is yet to be achieved on the Board as indicated below, we are currently working to ensure more female representation of the Board.

The number and percentage of men and women employed in the Bank and the Board's composition during

i) The analysis by grade of employees is as shown below:

ii) Analysis of Directors by gender:

18z) INDEPENDENT AUDITOR

Deloitte & Touche was first appointed at the Annual General Meeting held on 22 June 2023 and having satisfied the relevant corporate governance rules on their tenure in office, have indicated their willingness to continue in office as auditor to the Bank. In accordance with Section 401(2) of the Companies and Allied Matters Act of Nigeria (CAMA) 2020, the auditor will be re-appointed at the next annual general meeting of the Bank without any resolution being passed.

BY ORDER OF THE BOARD

Mrs. Osaro J. Idemudia Company Secretary/Legal Adviser FRC/2013/NBA/00000002319

19 March, 2025

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