Financial Statement 2025

KPMG

Zone 25 C Ring Road Street 230, Building 246

P.O Box 4473, Doha State of Qatar

Telephone: +974 4457 6444

Fax: +974 4436 7411

Website: kpmg.com/qa

Independent auditor's report

To the Shareholders of Qatar International Islamic Bank (Q.P.S.C.) Report on the Audit of the Consolidated Financial Statements

Opinion

We have audited the consolidated financial statements of Qatar International Islamic Bank (Q.P.S.C.) (the 'Bank') and its subsidiaries (together the 'Group'), which comprise the consolidated statement of financial position as at 31 December 2025, the consolidated statements of income, comprehensive income, income and attribution related to quasi-equity, changes in owners' equity and cash flows for the year then ended, and notes, comprising significant accounting policies and other explanatory information.

In our opinion, the accompanying consolidated financial statements present fairly, in all material respects, the consolidated financial position of the Group as at 31 December 2025, and its consolidated financial performance and its consolidated cash flows for the year then ended in accordance with Financial Accounting Standards (FAS) issued by the Accounting and Auditing Organization for Islamic Financial Institutions (AAOIFI) as modified by the Qatar Central Bank (QCB).

Basis for Opinion

We conducted our audit in accordance with International Standards on Auditing (ISAs). Our responsibilities under those standards are further described in the Auditor's Responsibilities for the Audit of the Consolidated Financial Statements section of our report. We are independent of the Group in accordance with the International Ethics Standards Board for Accountants International Code of Ethics for Professional Accountants (including International Independence Standards) (IESBA Code), as applicable to the audits of the financial statements of public interest entities, together with the ethical requirements that are relevant to our audit of the Bank's consolidated financial statements in the State of Qatar, and we have fulfilled our other ethical responsibilities in accordance with these requirements and the IESBA Code. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Key Audit Matters

Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the consolidated financial statements of the current period. These matters were addressed in the context of our audit of the consolidated financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters.

1

KPMG, Qatar Branch is registered with the Ministry of Commerce and Industry, State of Qatar, and a member firm of the KPMG global organization of independent member firms affiliated with KPMG International Limited, a private English company limited by guarantee. The KPMG name and logo are registered trademarks of KPMG International.

Other Information

The Board of Directors is responsible for the other information. The other information comprises the information included in the Bank's Annual Report, but does not include the consolidated financial statements and our auditor's report thereon. Prior to the date of this auditor's report, we obtained the report of the Chairman of the Board of Directors which forms part of the Annual Report, and the remaining sections of the Annual Report are expected to be made available to us after that date.

Our opinion on the consolidated financial statements does not cover the other information and we do not and will not express any form of assurance conclusion thereon.

In connection with our audit of the consolidated financial statements, our responsibility is to read the other information identified above and, in doing so, consider whether the other information is materially inconsistent with the consolidated financial statements or our knowledge obtained in the audit, or otherwise appears to be materially misstated.

If, based on the work we have performed on the other information that we have obtained prior to the date of this auditor's report, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.

Responsibilities of Board of Directors for the Consolidated Financial Statements

The Board of Directors is responsible for the preparation and fair presentation of the consolidated financial statements in accordance with FAS as modified by QCB, and for such internal control as the Board of Directors determines is necessary to enable the preparation of consolidated financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the consolidated financial statements, the Board of Directors is responsible for assessing the Group's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the Board of Directors either intends to liquidate the Group or to cease operations, or have no realistic alternative but to do so.

Auditor's Responsibilities for the Audit of the Consolidated Financial Statements

Our objectives are to obtain reasonable assurance about whether the consolidated financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these consolidated financial statements.

As part of an audit in accordance with ISAs, we exercise professional judgement and maintain professional scepticism throughout the audit. We also:

• Identify and assess the risks of material misstatement of the consolidated financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations or the override of internal control.

• Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances.

• Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the Board of Directors.

• Conclude on the appropriateness of the Board of Directors' use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Group's ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor's report to the related disclosures in the consolidated financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor's report. However, future events or conditions may cause the Group to cease to continue as a going concern.

• Evaluate the overall presentation, structure and content of the consolidated financial statements, including the disclosures, and whether the consolidated financial statements represent the underlying transactions and events in a manner that achieves fair presentation.

• Plan and perform the group audit to obtain sufficient appropriate audit evidence regarding the financial information of the entities or business units within the Group as a basis for forming an opinion on the group financial statements. We are responsible for the direction, supervision and review of the audit work performed for purposes of the group audit. We remain solely responsible for our audit opinion.

We communicate with the Board of Directors regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.

Auditor's Responsibilities for the Audit of the Consolidated Financial Statements (continued)

We also provide the Board of Directors with a statement that we have complied with relevant ethical requirements regarding independence, and communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, actions taken to eliminate threats or safeguards applied.

From the matters communicated with the Board of Directors, we determine those matters that were of most significance in the audit of the consolidated financial statements of the current period and are therefore the key audit matters. We describe these matters in our auditor's report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.

Report on Other Legal and Regulatory Requirements

As required by the Qatar Commercial Companies Law No. 11 of 2015, whose certain provisions were subsequently amended by Law No. 8 of 2021 ("amended QCCL"), we also report that:

1. We have obtained all the information and explanations we considered necessary for the purposes of our audit.

2. The Bank has maintained proper accounting records and its consolidated financial statements are in agreement therewith.

3. We have read the Chairman of the Board of Directors' report to be included in the Annual Report, and the financial information contained therein is in agreement with the books and records of the Bank.

4. We are not aware of any violations of the applicable provisions of the amended QCCL or the terms of the Bank's Articles of Association having occurred during the year which might have had a material effect on the Bank's consolidated financial position or performance as at and for the year ended 31 December 2025.

11 February 2026 Gopal Balasubramaniam

Doha KPMG

State of Qatar Qatar Auditor's Registry Number 251

Licensed by QFMA: External Auditor's License No. 120153

CONSOLIDATED STATEMENT OF FINANCIAL POSITION

As at 31 December 2025

These consolidated financial statements were approved by the Board of Directors on 26 January 2026 and were signed on its behalf by:

Dr. Khalid bin ani bin Abdullah Al Thani Chairman

Dr. Abdulbasit Ahmad Abdulrahman Al Shaibei Chief Executive Officer

The attached notes 1 to 40 form an integral part of these consolidated financial statements. Independent auditor's report is set out on pages 1-6.

The attached notes 1 to 40 form an integral part of these consolidated financial statements. Independent auditor's report is set out on pages 1-6.

For the year ended 31 December 2025

The attached notes 1 to 40 form an integral part of these consolidated financial statements. Independent auditor's report is set out on pages 1-6.

Qatar International Islamic Bank (Q.P.S.C.)

For the year ended 31 December 2025

Other movement - - - (372) - - 372 - - -Balance at 31 December 2025 1,513,687 2,452,360 1,014,464 5,182 6,161 24,690 2,944,511 7,961,055 2,092,450 10,053,505

additional capital - - - - - - (5,680) (5,680) - (5,680)

Balance at 31 December 2024 1,513,687 2,452,360 950,573 (274) (1,696) 83,856 2,509,148 7,507,654 2,092,450 9,600,104

The attached notes from 1 to 40 form an integral part of these consolidated financial statements. Independent auditor's report is set out on pages 1-6.

11

The attached notes from 1 to 40 form an integral part of these consolidated financial statements Independent auditor's report is set out on pages 1-6.

Qatar International Islamic Bank (Q.P.S.C.)

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

As at and for the year ended 31 December 2025

1. LEGAL STATUS AND PRINCIPAL ACTIVITIES

   Qatar International Islamic Bank (Q.P.S.C.) ("QIIB" or "the Bank") was incorporated under Amiri Decree No. 52 of 1990. The Bank operates through its head office located on Grand Hamad Street in Doha and 16 local branches. The Bank's equity shares are listed and traded on the Qatar Stock Exchange.

   The commercial registration number of the Bank is 13023. The address of the Bank's registered office is Grand Hamad Street 2, P.O. Box 664, Doha, State of Qatar.

   The consolidated financial statements include the financial information of the Bank and its subsidiaries which are, QIIB Senior Oryx Ltd (previously "QIIB Senior Sukuk Ltd"), QIIB Tier 1 Sukuk LLC and QIIB Tier 1 Sukuk Ltd, (special purpose entity ("SPE")) (together the "Group") after elimination of intercompany balances and transactions.

   QIIB Senior Oryx Ltd and QIIB Tier 1 Sukuk LLC, were incorporated in the State of Qatar for the purpose of issuing Sukuks and Tier 1 Sukuks respectively. QIIB Senior Oryx Ltd was registered and licensed under Qatar Financial Centre ("QFC") and regarded as a resident Company in the State of Qatar under Article 8(1)(b) of the QFC tax regulations. Further, QIIB Tier 1 Sukuk LLC was incorporated in the State of Qatar, as an exempted company with limited liability for the sole purpose of issuing Tier 1 Sukuks, for the benefit of QIIB.

   As licensed by Qatar Central Bank (QCB), the Bank is engaged in banking, financing and investing activities in accordance with its Articles of Incorporation, Islamic Shari'a Rules and Principles as determined by the Shari'a Supervisory Board of the Group and regulations of QCB.

   The consolidated financial statements of the Group for the year ended 31 December 2025 were authorised for issuance in accordance with a resolution by the Board of Directors on 26 January 2026.

   1. Shari'ah governance framework

      The Group follows Accounting and Auditing Organization for Islamic Financial Institutions ("AAOIFI") Governance Standards (GSs) in their entirety along with the regulators' requirements related to Shari'ah governance / Shari'ah governance framework. In line with the requirements of the same, the Group has a comprehensive governance mechanism comprising of Shari'ah supervisory board and internal Shari'ah audit. These functions perform their responsibilities in line with AAOIFI GSs as well as the regulators' requirements related to Shari'ah governance. The GSs also require the Board of Directors and those charged with governance to discharge their duties in line with Shari'ah governance and fiduciary responsibilities.

   2. Shari'ah principles and rules

      The Group follows the hierarchy of Shari'ah principles and rules as defined in paragraph 165 of FAS 1 "General Presentation and Disclosures in the Financial Statements".

2. BASIS OF PREPARATION

(a) Statement of compliance

The consolidated financial statements have been prepared in accordance with Financial Accounting Standards ("FAS") issued by the Accounting and Auditing Organization for Islamic Financial Institutions ("AAOIFI") as modified by Qatar Central Bank ("QCB"). QCB has mandated a modification through a circular issued, namely Circular No. 12 / 2020 on 29 April 2020 (the effective date), which amends the requirements of FAS 33 "Investments in Sukuk, shares and similar instruments" and FAS 30 "Impairment, credit losses and onerous commitments", and requires Islamic banks to follow the principles of the International Financial Reporting Standard 9 "Financial Instruments" in respect of impairment of equity-type investments carried at fair value through other comprehensive income (OCI).

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

As at and for the year ended 31 December 2025

1. BASIS OF PREPARATION (CONTINUED)
   1. Statement of compliance (continued)

      For matters that are not covered by FAS, the Group uses guidance from the relevant International Financial Reporting Standards ("IFRSs") as issued by the International Accounting Standards Board ("IASB").

   2. Basis of measurement

      The consolidated financial statements have been prepared on the historical cost basis except for investment securities classified as Investments at fair value through other comprehensive income (OCI) and Investments at fair value through statement of income.

      The Group's management have made an assessment of the Group's ability to continue as a going concern and is satisfied that the Group has the resources to continue in business for the foreseeable future. Furthermore, management is not aware of any material uncertainties that may cast significant doubt upon the Group's ability to continue as a going concern. Therefore, the consolidated financial statements continue to be prepared on the going concern basis.

   3. Functional and presentation currency

      These consolidated financial statements are presented in Qatari Riyals ("QR"), which is the Bank's functional and presentational currency. Except as otherwise indicated, financial information presented in QR have been rounded to the nearest thousands.

   4. Use of estimates and judgments

      The preparation of the consolidated financial statements in conformity with FAS requires management to make judgements, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets, liabilities, income and expenses. Actual results may differ from these estimates.

      Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognized in the period in which the estimate is revised and in any future periods affected.

      Information about significant areas of estimation uncertainty and critical judgements in applying accounting policies that have the most significant effect on the amounts recognized in the consolidated financial statements are described in note 6.

2. SIGNIFICANT ACCOUNTING POLICIES

   The accounting policies set out below have been applied consistently to all periods presented in these consolidated financial statements and have been applied consistently by the Group except for the effects of standards mentioned in note 3 (ah).

   1. Basis of consolidation

      1. Special purpose entities

Special purpose entities ("SPEs") are entities that are created to accomplish a narrow and well-defined objective such as the securitization of particular assets, or the execution of a specific financing transaction. An SPE is consolidated if, based on an evaluation of the substance of its relationship with the Group and the SPE's risks and rewards. The Group management concludes that it controls the SPE. The following circumstances may indicate a relationship in which, in substance, the Group controls and consequently consolidates an SPE:

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

As at and for the year ended 31 December 2025

1. Basis of consolidation (continued)

   1. Special purpose entities (continued)

      • the activities of the SPE are being conducted on behalf of the Group according to its specific business needs so that the Group obtains benefits from the SPE's operation;

      • the Group has the decision-making powers to obtain the majority of the benefits of the activities of the SPE or, by setting up an 'autopilot' mechanism, the Group has delegated these decision-making powers;

      • the Group has rights to obtain the majority of the benefits of the SPE and therefore may be exposed to risks incident to the activities of the SPE;

      • the Group retains the majority of the residual or ownership risks related to the SPE or its assets in order to obtain benefits from its activities.

        The assessment of whether the Group has control over an SPE is carried out at inception and normally no further reassessment of control is carried out in the absence of changes in the structure or terms of the SPE, or additional transactions between the Group and the SPE. Day-to-day changes in market conditions normally do not lead to a reassessment of control. However, sometimes changes in market conditions may alter the substance of the relationship between the Group and the SPE and in such instances the Group determines whether the change warrants a reassessment of control based on the specific facts and circumstances, where the Group's voluntary actions, such as financing amounts in excess of existing liquidity facilities or extending terms beyond those established originally, would lead to a change in the relationship between the Group and an SPE, the Group then performs a reassessment of control over the SPE.

2. Investment in associates

Associates are entities over which the Group has significant influence. Significant influence is the power to participate in the financial and operating decisions of the investee, but not to control or impose joint control over those policies, generally accompanying a shareholding between 20% and 50% of the voting rights.

The considerations made in determining significant influence or joint control are similar to those necessary to determine control over subsidiaries.

Investments in associates are accounted for by the equity method of accounting and are initially recognized at cost (including transaction costs directly related to acquisition of investment in associate).

The Group's share of its associates' post-acquisition profits or losses is recognized in the consolidated statement of income; its share of post-acquisition movements in reserve is recognized in equity. The cumulative post-acquisition movements are adjusted against the carrying amount of the investment. When the Group's share of losses in an associate are equal or exceeds its interest in the associate, including any other unsecured receivables, The Group does not recognize further losses, unless it have incurred obligations or made payments on behalf of the associate.

The Group determines at each reporting date whether there is any objective evidence that the investment in associate is impaired. If this is the case the Group calculates the amount of impairment as being the difference between the fair value of the associate and the carrying value and recognizes the amount in the consolidated statement of income.

Intergroup gains on transactions between the Group and its associates are eliminated to the extent of the Group's interest in the associates. Intragroup losses are also eliminated unless the transaction provides evidence of an impairment of the asset transferred. For preparation of these consolidated financial statements, equal accounting policies for similar transactions and other events in similar circumstances are used. Dilution gains and losses in associates are recognized in the consolidated statement of income.

The Group's share of the results of associates is based on financial statements available up to a date not earlier than three months before the date of the consolidated statement of financial position, adjusted to conform to the accounting policies of the Group. An adjustment shall be made for the effects of any significant transactions or events that occur between that date and the date of the Groups financial statements. The accounting policies of associates have been changed where necessary to ensure consistency with policies adopted by the Group.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

As at and for the year ended 31 December 2025

1. Investment in associates (continued)

   Upon loss of significant influence over the associate, the Group measures and recognizes any retaining investment at its fair value. Any difference between the carrying amount of the associate upon loss of significant influence and the fair value of the investment retained plus proceeds from disposal is recognized in the consolidated statement of income.

2. Foreign currency Foreign currency transactions and balances

   Foreign currency transactions are denominated in foreign currency, or that require settlement in a foreign currency are translated into the respective functional currencies of the operations at the spot exchange rates on the transaction dates.

   Monetary assets and liabilities denominated in foreign currencies at the reporting date are translated into the functional currency at the spot exchange rate at that date. Non-monetary assets and liabilities denominated in foreign currencies that are measured at fair value are retranslated into the functional currency at the spot exchange rate at the date that the fair value was determined. Non-monetary assets and liabilities that are measured in terms of historical cost in a foreign currency are translated using the exchange rate at the date of the transaction.

   Foreign currency differences resulting from the settlement of foreign currency transactions and arising from conversion at period end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognized in the consolidated statement of income.

   Investments in associate companies are translated into Qatari Riyals at the rates ruling on the reporting date. The income or loss is translated at the average exchange rates for the year.

3. Investment securities

   Investment securities comprise investments in debt-type, equity-type and other investment instruments.

   1. Classification

      Debt-type instruments are types of investments, whereby the transaction structure results in creation of a monetary or non-monetary liability. Equity-type instruments are investments that evidence a residual interest in the assets of an entity after deducting all the liabilities and quasi equity balances, including ordinary equity instruments and such other structured investment instruments that classify as equity instruments in line with the requirements of FAS 33. While Other Investment Instruments are such investment instruments which do not meet the definition of either debt type or equity type instruments.

      Amortised cost

      An investment instrument shall be measured at amortised cost if both of the following conditions are met:

      1. the investment is held within a business model whose objective is to hold such investment in order to collect expected cashflows till maturity of the instrument; and

      2. the investment represents either a debt type instrument or other investment instrument having reasonably determinable effective yield.

An investment shall be measured at fair value through other comprehensive income (OCI) if both of the following conditions are met:

1. the investment is held within a business model whose objective is achieved by collecting the expected cashflows and selling the investment; and

2. the investment represents a non-monetary debt type instrument or other investment instrument having reasonably determinable effective yield.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

As at and for the year ended 31 December 2025

1. Investment securities (continued)

   1. Classification (continued)

      Fair value through other comprehensive income (OCI) (continued)

      Instruments not classified as amortised cost or fair value through OCI, are classified as fair value through income statement (FVIS).

      On initial recognition, the Group makes an irrevocable election to designate certain equity instruments that are not designated at fair value through income statement to be classified as investments at fair value through OCI.

      Business model: the business model reflects how the Group manages the assets in order to generate cash flows. That is, whether the Group's objective is solely to collect the contractual cash flows from the assets or is to collect both the contractual cash flows and cash flows arising from the sale of assets. If neither of these is applicable (e.g. financial assets are held for trading purposes), then the financial assets are classified as part of 'other' business model and measured at FVIS. Factors considered by the Group in determining the business model for a group of assets include past experience on how the cash flows for these assets were collected, how the asset's performance is evaluated and reported to key management personnel, how risks are assessed and managed and how managers are compensated. For example, the Group's business model for the Investments is solely to collect contractual cash flows. Another example is the debt investment securities, which is held by the Group as part of liquidity management and is generally classified within the hold to collect and sell business model.

   2. Recognition and derecognition

      Investment securities are recognized at the trade date i.e. the date that the Group contracts to purchase or sell the asset, at which date the Group becomes party to the contractual provisions of the instrument. Investment securities are derecognized when the rights to receive cash flows from the financial assets have expired or where the Group has transferred substantially all risk and rewards of ownership.

   3. Measurement Initial recognition

      Investment securities are initially recognized at fair value plus transaction costs, except for transaction costs incurred to acquire investments at fair value through income statement which are charged to consolidated statement of income.

      Subsequent measurement

      Investments at fair value through income statement are re-measured at fair value at the end of each reporting period and the resultant re-measurement gains or losses is recognized in the consolidated statement of income in the period in which they arise.

      Investments classified at amortised cost are measured at amortised cost using the effective profit method less any impairment allowance. All gains or losses arising from the amortization process and those arising on derecognition or impairment of the investments, are recognized in the consolidated statement of income.

      Investments at fair value through other comprehensive income (OCI) are re-measured at their fair values at the end of each reporting period and the resultant gain or loss, arising from a change in the fair value of investments are recognized in the consolidated statement of comprehensive income and presented in a separate fair value reserve within equity. When the investments classified as fair value through other comprehensive income (OCI) are sold, impaired, collected or otherwise disposed of, the cumulative gain or loss previously recognized in the consolidated statement of comprehensive income is transferred to the consolidated statement of income, except in case of equity type instruments designated as at FVTE, where this difference is recognised in statement of changes in equity and is not recognised in the income statement on derecognition of such instruments.

      Investments which do not have a quoted market price or other appropriate methods from which to derive a reliable measure of fair value on a continuous basis cannot be determined, are stated at cost less impairment allowance, (if any).

      NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

      As at and for the year ended 31 December 2025

      3 SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
      1. Investment securities (continued)

   4. Measurement principles Amortised cost measurement

      The amortised cost of a financial asset or liability is the amount at which the financial asset or liability is measured at initial recognition, minus capital repayments, plus or minus the cumulative amortization using the effective profit method of any difference between the initial amount recognized and the maturity amount, minus any reduction for impairment. The calculation of the effective profit rate includes all fees and points paid or received that are an integral part of the effective profit rate.

      Fair value measurement

      Fair value is the amount for which an asset could be exchanged or an obligation settled between well informed and willing parties (seller and buyer) in an arm's length transaction. The Group measures the fair value of quoted investments using the market bid price for that instrument at the close of business on the consolidated statement of financial position date. For investment where there is no quoted market price, a reasonable estimate of the fair value is determined by reference to the current market value of another instrument, which is substantially the same or is based on the assessment of future cash flows. The cash equivalent values are determined by the Group by discounting future cash flows at current profit rates for contracts with similar term and risk characteristics.

      1. Financing assets

      Financing assets comprise Shari'a compliant financing provided by the Group with fixed or determinable payments. These include financing provided through Murabaha, Mudaraba, Musharaka, Musawama, Ijarah Muntahia Bittamleek, Istisn'a and other modes of Islamic financing. Financing assets are stated at their amortised cost less impairment allowances (if any).

      Murabaha and Musawama

      Murabaha and Musawama receivables are sales on deferred terms. The Group arranges a Murabaha and Musawama transaction by buying a commodity (which represents the object of the Murabaha) and selling it to the Murabaha (a beneficiary) at a margin of profit over cost. The sales price (cost plus the profit margin) is repaid in installments by the Murabaha over the agreed period. Murabaha and Musawama receivables are stated net of deferred profits and impairment allowance (if any). Based on QCB regulations, the Group applies the rule of binding the purchase orderer to its promise in the Murabaha sale, and not to enter into any Murabaha transaction in which the purchase orderer does not undertake to accept the goods if they meet the specifications.

      Mudaraba and Musharaka

      Mudaraba and Musharaka financing are partnerships in which the Group contributes the capital in Mudaraba, capital and work in Musharaka. These contracts are stated at fair value of consideration given less impairment allowance (if any).

      Ijarah Muntahia Bittamleek

      Ijarah Muntahia Bittamleek receivables arise from financing structures when the purchase and immediate lease of an asset are at cost plus an agreed profit (in total forming fair value). The amount is settled on a deferred payment basis. Ijarah Muntahia Bittamleek receivables are carried at the aggregate of the minimum lease payments, less deferred income (in total forming amortised cost) and impairment allowance (if any).

      Istisn'a

      Istisna'a is a sales contract in which the Group acts as 'al-sani' (a seller) with an 'al-mustasni' (a purchaser) and undertakes to manufacture based on the specification received from the purchaser, for an agreed upon price.

      NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

      As at and for the year ended 31 December 2025

      3 SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
      1. Financing assets (continued)

         Wakala

         Wakala contracts represent agency agreements between two parties. One party, the provider of funds (Muwakkil) appoints the other party as an agent (Wakeel) with respect to the investment of the Muwakkil funds in a Shari'a compliant transaction. The Wakeel uses the funds based on the nature of the contract and offer an anticipated return to the Muwakkil. Wakala contracts are stated at amortised cost.

      2. Other financial assets and liabilities

         1. Recognition and initial measurement

            The Group initially recognizes due from banks, financing assets, customers' current accounts, due to banks, Sukuk financing and certain other assets and other liabilities on the date at which they were originated. All other financial assets and liabilities are initially recognized on the settlement date at which the Group becomes a party to the contractual provisions of the instrument.

            A financial asset or financial liability is measured initially at fair value plus, for an item not at fair value through income statement, transaction costs that are directly attributable to its acquisition or issue.

            After initial measurement, other financial assets and liabilities are subsequently measured at amortised cost using the effective profit rate method net of any amounts written off and provision for impairment.

         2. De-recognition of financial assets and financial liabilities

      The Group derecognizes a financial asset when the contractual rights to the cash flows from the financial asset expire, or when it transfers the financial asset in a transaction in which substantially all the risks and rewards of ownership of the financial asset are transferred or in which the Group neither transfers nor retains substantially all the risks and rewards of ownership and it does not retain control of the financial asset.

      Any interest in transferred financial assets that qualify for derecognition that is created or retained by the Group is recognized as a separate asset or liability in the consolidated statement of financial position. On derecognition of a financial asset, the difference between the carrying amount of the asset (or the carrying amount allocated to the portion of the asset transferred), and consideration received (including any new asset obtained less any new liability assumed) is recognized in consolidated statement of income.

      The Group enters into transactions whereby it transfers assets recognized on its consolidated statement of financial position, but retains either all or substantially all of the risks and rewards of the transferred assets or a portion of them. If all or substantially all risks and rewards are retained, then the transferred assets are not derecognized.

      In transactions in which the Group neither retains nor transfers substantially all the risks and rewards of ownership of a financial asset and it retains control over the asset, the Group continues to recognize the asset to the extent of its continuing involvement, determined by the extent to which it is exposed to changes in the value of the transferred asset.

      In certain transactions the Group retains the obligation to service the transferred financial asset for a fee. The transferred asset is derecognized if it meets the derecognition criteria. An asset or liability is recognized for the servicing contract, depending on whether the servicing fee is more than adequate (asset) or is less than adequate (liability) for performing the servicing.

      The Group enters into transactions where it retains the contractual rights to receive cash flows from assets but assumes a contractual obligation to pay those cash flows to other entities and transfers substantially all of the risks and rewards. These transactions are accounted for as 'pass through' transfers that result in derecognition if the Group:

      • Have no obligation to make payments unless it collects equivalent amounts from the assets;

      • Is prohibited from selling or pledging the assets; and

      • Have an obligation to remit any cash it collects from the assets without material delay.

        NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

        As at and for the year ended 31 December 2025

        3 SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
        1. Other financial assets and liabilities (continued)

           1. De-recognition of financial assets and financial liabilities (continued)

              Collateral (shares and sukuk) furnished by the Group under standard repurchase agreements and securities lending and borrowing transactions are not derecognized because the Group retains substantially all the risks and rewards on the basis of the predetermined repurchase price, and the criteria for derecognition are therefore not met. This also applies to certain securitization transactions in which the Group retains a subordinated residual interest.

              The Group derecognizes a financial liability when they are extinguished (i.e. when the obligation specified in the contract is discharged or cancelled or expires).

              The exchange between the Group and its original lenders of debt instruments with substantially different terms, as well as substantial modifications of the terms of existing financial liabilities, are accounted for as an extinguishment of the original financial liability and the recognition of a new financial liability. The terms are substantially different if the discounted present value of the cash flows under the new terms, including any fees paid net of any fees received and discounted using the original effective profit rate, is at least 10% different from the discounted present value of the remaining cash flows of the original financial liability. In addition, other qualitative factors, such as the currency that the instrument is denominated in, changes in the type of profit rate, new conversion features attached to the instrument and change in covenants are also taken into consideration. If an exchange of debt instruments or modification of terms is accounted for as an extinguishment, any costs or fees incurred are recognized as part of the gain or loss on the extinguishment. If the exchange or modification is not accounted for as an extinguishment, any costs or fees incurred adjust the carrying amount of the liability and are amortised over the remaining term of the modified liability.

           2. Offsetting

           Financial assets and liabilities are offset only when there is a legal or religious enforceable right to set off the recognized amounts and the Group intends to either settle on a net basis, or to realize the asset and settle the liability simultaneously.

        2. Impairment of financial assets

        The Group recognises loss allowances for expected credit loss (ECL) on the following financial instruments that are not measured at fair value through statement of income:

      • Financial assets that are debt instruments;

      • Financial guarantee contracts issued; and

      • Financing commitments issued.

        The Group measures loss allowances at an amount equal to lifetime ECL, except for the following, for which they are measured as 12-month ECL:

      • debt investment securities that are determined to have low credit risk at the reporting date; and

      • other financial instruments on which credit risk have not increased significantly since their initial recognition.

        12-month ECL are the portion of ECL that result from default events on a financial instrument that are possible within the 12 months after the reporting date.

        Measurement of ECL

        ECL are a probability-weighted estimate of credit losses. They are measured as follows:

      • Financial assets that are not credit-impaired at the reporting date: as the present value of all cash shortfalls (i.e. the difference between the cash flows due to the entity in accordance with the contract and the cash flows that the Group expects to receive);

      • Financial assets that are credit-impaired at the reporting date: as the difference between the gross carrying amount and the present value of estimated future cash flows;

        NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

        As at and for the year ended 31 December 2025

        3 SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
        1. Impairment of financial assets (continued) Measurement of ECL (continued)

      • Undrawn financing commitments: as the present value of the difference between the contractual cash flows that are due to the Group if the commitment is drawn down and the cash flows that the Group expects to receive; and

      • Financial guarantee contracts: the expected payments to reimburse the holder less any amounts that the Group expects to recover.

        Restructured financial assets

        If the terms of a financial asset are renegotiated or modified or an existing financial asset is replaced with a new one due to financial difficulties of the borrower, then an assessment is made of whether the financial asset should be derecognized and ECL are measured as follows:

      • If the expected restructuring will not result in derecognition of existing asset, then the expected cash flows arising from the modified financial asset are included in calculating the cash shortfalls from existing asset;

      • If the expected restructuring will result in derecognition of the existing asset, then the expected fair value of the new asset is treated as the final cash flow from the existing financial asset at the time of its derecognition. This amount is included in calculating the cash shortfalls from the existing financial asset that are discounted from the expected date of derecognition to the reporting date using the original effective profit rate of the existing financial asset.

        Credit-impaired financial assets

        At each reporting date, the Group assesses whether financial assets carried at amortised cost are credit impaired. A financial asset is 'credit-impaired' when one or more events that have a detrimental impact on the estimated future cash flows of the financial asset have occurred.

        Evidence that a financial asset is credit-impaired includes the following observable data:

      • Significant financial difficulty of the borrower or issuer;

      • A breach of contract such as a default or past due event;

      • The restructuring of a financing asset by the Group on terms that the Group would not consider otherwise;

      • It is becoming probable that the borrower will enter bankruptcy or other financial reorganisation; or

      • The disappearance of an active market for a security because of financial difficulties.

      1. Modified financial assets and liabilities Modified Financial Assets

      If the terms of a financial asset are modified, the Group evaluates whether the cash flows of the modified asset are substantially different. If the cash flows are substantially different, then the contractual rights to cash flows from the original financial asset are deemed to have expired. In this case, the original financial asset is derecognised and a new financial asset is recognised at fair value, and a new effective profit rate for the asset is recalculated. The date of renegotiation is consequently considered to be the date of initial recognition for impairment calculation purpose, including for the purpose of determining whether a significant increase in credit risk have occurred.

      If the cash flows of the modified asset carried at amortised cost are not substantially different, then the modification does not result in derecognition of the financial asset. In this case, the Group recalculates the gross carrying amount of the financial asset based on the revised cash flows of the financial assets and recognises the amount arising from adjusting the gross carrying amount as a modification gain or loss in the consolidated income statement. If such a modification is carried out because of financial difficulties of the borrower, then the gain or loss is presented together with impairment losses. In other cases, it is presented as net income from financing activities.

      NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

      As at and for the year ended 31 December 2025

      3 SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
      1. Modified financial assets and liabilities (continued) Modified Financial Liabilities

         The Group derecognises a financial liability when its terms are modified and the cash flows of the modified liability are substantially different. In this case, a new financial liability based on the modified terms is recognised at fair value. The difference between the carrying amount of the financial liability extinguished and the new financial liability with modified terms is recognised in the consolidated statement of income.

      2. Cash and cash equivalents

         Cash and cash equivalents include notes and coins on hand, balances held with Qatar Central Bank and highly liquid financial assets with maturities of three months or less from the acquisition date that are subject to an insignificant risk of changes in their fair value, and are used by the Group in the management of its short-term commitments.

         Cash and cash equivalents are carried at amortised cost in the consolidated statement of financial position.

      3. Risk management instruments

         The Group enters into certain Islamic derivative financial instruments to manage the exposure to foreign exchange rate risks, including unilateral promise to buy /sell currencies. These transactions are translated at prevailing spot exchange rates.

      4. Investment properties

      Investment properties held for rental or capital appreciation are measured at cost including cash equivalent amount paid or fair value of other consideration given to acquire an asset at the time of its acquisition or construction.

      Depreciation is systematically allocated for the cost of the investment properties over its useful life. Investment properties are measured at cost less accumulated depreciation and impairment losses.

      Major expenditure incurred by the entity related to additions and improvement subsequent to its acquisition will be added to the carrying amount of investment property in the consolidated statement of financial position, provided that the Group expects that such expenditure will increase the future economic benefits to the Group from the investment property. However, if such economic benefits are not expected to take place, the entity will recognize this expenditure in the consolidated statement of income in the financial period in which it is incurred, taking into consideration the split between the portion related to owners' equity and the portion related to Quasi equity.

      Depreciation for investments properties are recognized in consolidated statement of income on a straight-line basis over the estimated useful lives of each part of an item of investment properties since this closely reflects the expected pattern of consumption of the future economic benefits embodied in the property and is based on cost of the property less its estimated residual value. Land and work-in-progress are not depreciated.

      The estimated useful lives for the current and comparative years are as follows:

      Years

      Buildings 20

      Fixtures and fittings 5-7

      Useful lives and residual values are reassessed at each reporting date and adjusted prospectively, if appropriate. Repairs and maintenance expenses are charged to the statement of income when incurred.

      NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

      As at and for the year ended 31 December 2025

      3 SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
      1. Investment properties (continued)

         Investment property is derecognized on disposal or when the property is permanently withdrawn from use and no future economic benefits are expected from its disposal. Gain or losses arising from the retirement or disposal will be determined as the difference between the net disposal proceeds and the carrying amount of the asset, and will be recognized in consolidated statement of income in the period of the retirement or disposal, taking into consideration the split between the portion related to owners' equity and the portion related to Quasi equity.

      2. Fixed assets

         1. Recognition and measurement

            Items of fixed assets are measured at cost less accumulated depreciation and impairment losses.

            Cost includes expenditures that are directly attributable to the acquisition of the asset. The cost of self-constructed assets includes the cost of materials and direct labor, any other costs directly attributable to bringing the assets to a working condition for their intended use, the costs of dismantling and removing the assets and restoring the site on which they are located and capitalized borrowing costs.

            Purchased software that is integral to the functionality of the related equipment is capitalized as part of related equipment.

            When parts of an item of fixed asset have different useful lives, they are accounted for as separate items (major components) of fixed assets. The gain or loss on disposal of an item of fixed asset is determined by comparing the proceeds from disposal with the carrying amount of the item of fixed assets and is recognized in other income

            /other expenses in the consolidated statement of income.

         2. Subsequent costs

            The cost of replacing a component of fixed asset is recognized in the carrying amount of the item if it is probable that the future economic benefits embodied within the part will flow to the Group and its cost can be measured reliably. The carrying amount of the replaced part is derecognized.

            The costs of the day-to-day servicing of fixed assets are recognized in consolidated statement of income as incurred. Depreciation is recognized in consolidated income statement on a straight-line basis over the estimated useful lives of each part of an item of fixed assets since this closely reflects the expected pattern of consumption of the future economic benefits embodied in the asset and is based on cost of the asset less its estimated residual value. Land and work-in-progress are not depreciated.

            The estimated useful lives for the current and comparative years are as follows:
            	Years
            Buildings	20
            IT equipment	3
            Fixtures and fittings	5-7
            Motor vehicles	5

            Useful lives and residual values are reassessed at each reporting date and adjusted prospectively, if appropriate. Repairs and maintenance expenses are charged to the statement of income when incurred.

            NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

            As at and for the year ended 31 December 2025

            3 SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
      3. Intangible Assets

         Intangible assets acquired separately are measured on initial recognition at cost. The useful lives of intangible assets are assessed to be finite.

         Intangible assets with finite lives are amortised over the useful economic life and assessed for impairment whenever there is an indication that the intangible asset may be impaired. The amortization period and the amortization method for an intangible asset with a finite useful life is reviewed at each financial year. Changes in the expected useful life or the expected pattern of consumption of future economic benefits embodied in the asset is accounted for by changing the amortization period or method, as appropriate, and treated as changes in accounting estimates. The amortization expense on intangible assets with finite lives is recognized in the consolidated statement of income in the expense category consistent with the nature of the intangible asset.

         A summary of the useful lives and amortization methods of Group's intangible assets are as follows:

         Software Finite (5 years)

         Software is acquired and amortised on a straight line basis over the periods of availability.

      4. Impairment of non-financial assets

         The carrying amounts of the Group's non-financial assets are reviewed at each reporting date to determine whether there is any indication of impairment. If any such indication exists, then the asset's recoverable amount is estimated. An impairment loss is recognized if the carrying amount of an asset or its Cash Generating Unit ("CGU") exceeds its estimated recoverable amount.

         The recoverable amount of an asset or CGU is the greater of its value in use and its fair value less costs to sell. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset or CGU.

         For the purpose of impairment testing, assets that cannot be tested individually are grouped together into the smallest group of assets that generates cash inflows from continuing use that are largely independent of the cash inflows of other assets or CGU.

         The Group's corporate assets do not generate separate cash inflows and are utilized by more than one CGU. Corporate assets are allocated to CGUs on a reasonable and consistent basis and tested for impairment as part of the testing of the CGU to which the corporate asset is allocated.

         Impairment losses are recognized in consolidated statement of income. Impairment losses recognized in respect of CGUs are allocated first to reduce the carrying amount of any goodwill allocated to the CGU (group of CGUs) and then to reduce the carrying amount of the other assets in the CGU (group of CGUs) on a pro rata basis.

         An impairment loss in respect of goodwill is not reversed. In respect of other assets, impairment losses recognized in prior periods are assessed at each reporting date for any indications that the loss have decreased or no longer exists. An impairment loss is reversed if there have been a change in the estimates used to determine the recoverable amount.

         An impairment loss is reversed only to the extent that the asset's carrying amount does not exceed the carrying amount that would have been determined, net of depreciation or amortization, if no impairment loss had been recognized.

      5. Customers' current accounts

         Balances in current accounts are recognized when received by the Group. The transactions are measured as the amount received by the Group at the time of contracting. At the end of the reporting period, these accounts are measured at amortised cost.

         NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

         As at and for the year ended 31 December 2025

         3 SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
      6. Quasi-equity

         Quasi-equity is an element of the financial statements that represents participatory contributions received by an institution on a profit sharing or participation basis. It has:

         • primary characteristics of equity i.e., in case of loss (unless negligence/ misconduct/ breach of contractual terms is proved), the institution is not liable to return the lost funds to the fund providers and the fund providers share the residual interest in the underlying assets or business;

         • certain characteristics of a liability i.e., it has a maturity or a put option of redemption/ liquidation; and

         • certain specific features i.e., the rights of the fund providers are limited only to the underlying assets or business and not on the whole of the institution, as well as, they do not have certain rights associated only with owners' equity.

           All contributions of quasi-equity holders are measured by the amount received during the time of contracting. At the end of the financial period, the equity of quasi-equity holders is measured at the amount received plus accrued profit and related reserves less amounts settled.

           Quasi-equity holders include participatory investment accounts (unrestricted investment accounts).

           Participatory investment accounts

           Participatory investment accounts are funds held by the Group, which it can invest at its own discretion. The investment account holders authorize the Group to invest the account holders' funds in a manner which the Group deems appropriate without laying down any restrictions as to where, how and for what purpose the funds should be invested. The Group charges a management fee (Mudarib fees) to investment account holders of the total income from investment accounts, the income attributable to account holders is allocated to investment accounts after setting aside provisions and deducting the Group's share of income as a Mudarib. The allocation of income is determined by the management of the Group within the allowed profit sharing limits as per the terms and conditions of the investment accounts.

      7. Distribution of profit between participatory investment account holders and shareholders

         The Group complies with the directives of the QCB as follows:

         • Net profit is arrived at after taking into account all income and expenses at the end of the financial year, and is distributed between participatory investment account holders and shareholders of the Bank.

         • The share of profit of participatory investment account holders is calculated on the basis of their daily deposit balances over the year, after reducing the Group's agreed and declared Mudaraba fee.

         • In case of any expense or loss, which arises out of negligence on the part of the Group due to noncompliance with QCB regulations and instructions, then such expenses or loss, shall not be borne by the participatory investment account holders. Such matter is subject to the QCB decision.

         • In case the results of the Group at the year end are net losses, then QCB, being the authority responsible for determining the Group's accountability for these losses, shall decide how these shall be treated without violation to the Islamic Shari'a rules.

         • Due to pooling of participatory investment funds with the Group's funds for the purpose of investment, no priority have been given to either party in the appropriation of profit.

         All assets are jointly financed by participatory investment account holders and equity holders.

      8. Sukuk financing

         Sukuk financing represents equal shares in the ownership of identified assets are Murabaha, benefits or services which bears fixed semi-annual profit and mature after 5 years on dates fixed on the issuance date. Profits are recognized periodically till maturity. Sukuks are recognized at amortised cost. Sukuks are disclosed as a separate line in the consolidated financial statements as "Sukuk financing".

         NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

         As at and for the year ended 31 December 2025

         3 SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
      9. Sukuk eligible as additional capital

         Sukuks issued by the Group which are perpetual, unsecured, subordinated to ordinary equity shares and the payment of profit for such sukuk is non-cumulative, and are made at the discretion of Group are initially recognized as equity. The Group has the right not to pay profit on these sukuk, and the sukuk holders will have no claim with respect to non-payment. The sukuk does not have a fixed maturity date.

         The Group incurs various costs in issuing its own instruments which are accounted for in equity as mentioned in the above paragraph. Those costs might include registration and other regulatory fees, amounts paid to legal, accounting and other professional advisers, printing costs and stamp duties. The transaction costs of an equity transaction are accounted for as a deduction from equity to the extent they are incremental costs directly attributable to the equity transaction that otherwise would have been avoided. The costs of an equity transaction that is abandoned are recognised as an expense.

         Profit distributions on perpetual sukuk are recognized as a deduction in equity after declaration in terms of agreement with sukuk holders and meeting regulatory requirements due to their profit's non-cumulative feature.

      10. Provisions

          Provision is recognized if, as a result of a past event, the Group has a present legal or constructive obligation that can be estimated reliably, and it is probable that an outflow of economic benefits will be required to settle the obligation.

      11. Employee benefits

      12. Defined contribution plans

          The Group provides for its contribution to the state administered retirement fund for Qatari employees in accordance with the retirement law, and the resulting charge is included within the staff costs in the consolidated statement of income. The Group has no further payment obligations once the contributions have been paid. The contributions are recognized when they are due.

          1. Employees' end of service benefits

             The Group provides a provision for all end of service benefits payable to employees in accordance with the Group's policies, calculated on the basis of individual employee's salary and period of service at the reporting date.

          2. Short-term employee benefits

          Short-term employee benefit obligations are measured on a undiscounted basis and are expensed as the related service is provided. A liability is recognized for the amount expected to be paid under short-term cash bonus or profit-sharing plans if the Group has a present legal or constructive obligation to pay this amount as a result of past service provided by the employee and the obligation can be estimated reliably.

   5. Owners' equity

1. Share issue costs

   Incremental costs directly attributable to the issue of an equity instrument are deducted from the initial measurement of the equity instrument.

2. Dividend on ordinary shares

Dividend on ordinary shares are recognized in equity in the period in which they are approved by the shareholders of the Bank.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

As at and for the year ended 31 December 2025

1. Revenue recognition

Murabaha and Musawama

Profit from Murabaha and Musawama transactions is recognized when the income is both contractually determinable and quantifiable at the commencement of the transaction. Such income is recognized on a time-apportioned basis over the period of the transaction. Where the income from a contract is not contractually determinable or quantifiable, it is recognized when the realization is reasonably certain or when actually realized. Income related to non-performing accounts is excluded from the consolidated statement of income.

Mudaraba

Income on Mudaraba financing is recognized when the right to receive payment is established or on distribution by the Mudarib, whereas losses are charged to the consolidated statement of income on declaration by the Mudarib. In case Mudaraba capital is lost or damaged prior to the inception of work without misconduct or negligence on the part of Mudarib, then such losses are deducted from Mudaraba capital and are treated as loss to the Group. In case of termination or liquidation, unpaid portion by Mudarib is recognized as receivable due from Mudarib.

Musharaka

Income on Musharaka financing is recognized when the right to receive payments is established or on distribution.

Ijara Muntahia Bittamleek

Ijara income is recognized on time-apportioned basis over the lease period. Income related to non-performing accounts is excluded from the consolidated statement of income.

Wakala

Income from Wakala placements is recognized on a time apportioned basis so as to yield a constant periodic rate of return based on the balance outstanding.

Istisn'a

Revenue and the associated profit margin are recognized in the Group's consolidated statement of income according to the percentage of completion method by taking in account the difference between total revenue (cash price to purchaser) and Group's estimated cost. The Group recognizes anticipated losses on Istisna'a contract as soon as they are anticipated.

Income from investment banking services

Income from investment banking services (presented in fee and commission income), including placement, advisory, marketing and performance fees, is recognized as per contractual terms when the service is provided, and income is earned. This is usually when the Group has performed all significant acts in relation to a transaction and it is highly probable that the economic benefits from the transaction will flow to the Group. Significant acts in relation to a transaction are determined based on the terms agreed in the contracts for each transaction. The assessment of whether economic benefits from a transaction will flow to the Group is based on the extent of binding firm commitments received from other parties.

Fees and commission income

Fees and commission income that are integral to the effective profit rate on a financial asset carried at amortised cost are included in the measurement of the effective profit rate of the financial asset. Other fees and commission income, including account servicing fees, sales commission, management, arrangement and syndication fees, are recognized over time as the related services are performed. Other fee and commission including income from trade financing or guarantees is recognized at a point in time. The performance, as well as the timing of their satisfaction, are identified and determined, at the inception of the contract.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

As at and for the year ended 31 December 2025

1. Revenue recognition (continued)

   Dividend income

   Dividend income is recognized when the right to receive the dividend is established.

2. Earnings per share

   The Group presents basic and diluted earnings per share ("EPS") data for its ordinary shares. Basic EPS is calculated by dividing the profit or loss attributable to the shareholders after deducting profit payable to sukuk eligible as additional capital by the weighted average number of ordinary shares outstanding during the period. Diluted EPS is determined by adjusting the profit or loss attributable to owners and the weighted average number of ordinary shares outstanding for the effects of all dilutive potential ordinary shares.

3. Segment reporting

   An operating segment is a component of the Group that engages in business activities from which it may earn revenues and incur expenses, including revenues and expenses that relate to transactions with any of the Group's other components, whose operating results are reviewed regularly by the Chief Executive Officer (being the chief operating decision maker) of the Group to make decisions about resources allocated to each segment and assess its performance, and for which discrete financial information is available.

4. Earnings prohibited by Shari'a

The Group is committed to avoid recognizing any income generated from non- Sharia' compliant sources. Accordingly, all non-Shari'a compliant income is credited to a charity account where the Group uses these funds for charitable purposes as defined by the Sharia Supervisory Board.

The Group accepts deposits from customers under wakala arrangement under which return expected to customers is agreed in the wakala agreement. There is no restriction on the Group for the use of funds received under wakala agreements. Wakala payables are carried at cost plus accrued profit.

In the ordinary course of business, the Group gives financial guarantees, consisting of letters of credit, guarantees and acceptances.

Financial guarantee contracts are contracts that require the issuer to make specified payments to reimburse the holder for a loss it incurs because a specified debtor fails to make payments when due, in accordance with the terms of a debt instrument. Such financial guarantees are given to banks, financial institutions and others on behalf of customers to secure financing, overdrafts and other banking facilities.

Financial guarantees are initially recognized in the consolidated financial statements at fair value, being the premium received on the date the guarantee was given, and the initial fair value is amortised over the life of the financial guarantee. Subsequent to initial recognition, the Group's liability under such guarantees are measured at the higher of:

• The amount of the loss allowance (calculated as described in note 5b (ii) and 5b (iv); and

• The premium received on initial recognition less income recognized.

These estimates are determined based on experience of similar transactions and history of past losses, supplemented by the judgment of Management.

Any increase in the liability relating to guarantees is taken to the consolidated statement of income. The amortization of the premium received is recognized in the consolidated statement of income under "commission and fees income".

Financing commitments provided by the Group are measured as the amount of the loss allowance (calculated as described in note 5b (ii) and 5b (iv). The Group has not provided any commitment to provide financing at a below-market profit rate, or that can be settled net in cash or by delivering or issuing another financial instrument.