Bank of Sharjah P.J.S.C. Financial Information 30 September 2024

Name	Symbol	Market	Type
Bos Fund 29	LSE:PL63	London	Medium Term Loan

RNS Number : 7685I

Bank of Sharjah P.J.S.C.

18 October 2024

Bank of Sharjah P.J.S.C.

Review report and

condensed consolidated interim financial information

for the nine-month period ended 30 September 2024

Bank of Sharjah P.J.S.C.

Condensed consolidated interim financial information

for the period ended 30 September 2024

Table of contents Pages

Report on review of condensed consolidated interim financial information 1

Condensed consolidated interim statement of financial position (unaudited) 2

Condensed consolidated interim statement of profit or loss (unaudited) 3

Condensed consolidated interim statement of comprehensive income (unaudited) 4

Condensed consolidated interim statement of changes in equity (unaudited) 5

Condensed consolidated interim statement of cash flows (unaudited) 6

Notes to the condensed consolidated interim financial information (unaudited) 7 - 34

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Text Box: Grant Thornton Audit and Accounting Limited (Dubai Branch) The Offices 5 Level 3 Office 302, 303 One Central, DWTC Dubai, UAE P.O. Box 1620 T +971 4 388 9925 F +971 4 388 9915 www.grantthornton.ae

Independent Auditor's Report on Review of Condensed Consolidated Interim Financial Information to the Board of Directors of Bank of Sharjah P.J.S.C.

Introduction

We have reviewed the accompanying condensed consolidated interim statement of financial position of Bank of Sharjah P.J.S.C. (the "Bank") and its subsidiaries (collectively referred to as the "Group") as at 30 September 2024 and the related condensed consolidated interim statements of profit or loss and comprehensive income for the three-month and nine-month periods then ended, and the condensed consolidated interim statements of changes in equity and cash flows for the nine-month period then ended and explanatory notes. Management is responsible for the preparation and presentation of this condensed consolidated interim financial information in accordance with International Accounting Standard 34 - Interim Financial Reporting ("IAS 34"). Our responsibility is to express a conclusion on this condensed consolidated interim financial information based on our review.

Scope of review

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

Conclusion

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

Emphasis of Matter

We draw attention to note 2.1 to the condensed consolidated interim financial information, which describes the classification and measurement of the Bank's Subsidiary, Emirates Lebanon Bank S.A.L (the 'Subsidiary') as held for sale under IFRS 5 - Non-current Assets Held for Sale and Discontinued Operations. Due to the current geopolitical conditions in Lebanon, the sale has not been completed within one year from the date of classification and it was impractical for the Bank to obtain an updated valuation to arrive at the fair value less costs to sell for the Subsidiary as of 30 September 2024. Our review report is not modified in respect of this matter.

GRANT THORNTON UAE

Dr. Osama El-Bakry

Registration No: 935

Dubai, United Arab Emirates

17 October 2024

Condensed consolidated interim statement of financial position

As at 30 September 2024

	Note	30 September 2024 (unaudited)	31 December 2023 (audited)
		AED'000	AED'000
ASSETS
Cash and balances with central bank	8	3,753,586	4,558,295
Deposits and balances due from banks	9	554,122	618,633
Loans and advances, net	10	23,382,762	22,067,850
Investments securities, net	11	8,900,248	7,727,410
Investment properties		1,106,703	1,102,753
Assets acquired in settlement of debts		1,065,864	1,078,084
Other assets	12	928,924	1,252,252
Properties and equipment		191,843	209,613
Subsidiary held for sale	2.1	844,790	844,790
		------------------------	------------------------
Total assets		40,728,842	39,459,680
		=============	===========
LIABILITIES AND EQUITY
Liabilities
Customers' deposits	13	27,521,519	26,342,597
Deposits and balances due to banks	14	1,976,362	1,916,341
Repo borrowings	15	2,595,328	1,702,312
Other liabilities	16	1,315,678	1,987,917
Issued bonds	17	3,561,583	4,004,998
		------------------------	------------------------
Total liabilities		36,970,470	35,954,165
		------------------------	-----------------------
Equity
Share capital and reserves
Share capital		3,000,000	3,000,000
Statutory reserve		1,050,000	1,050,000
Impairment reserve		199,139	190,316
Investment fair value reserve		(797,564)	(754,382)
Currency translation reserve		(386,675)	(386,675)
Retained earnings		692,963	404,932
		------------------------	------------------------
Equity attributable to equity holders of the Bank		3,757,863	3,504,191
Non-controlling interests		509	1,324
		-----------------------	------------------------
Total equity		3,758,372	3,505,515
		------------------------	------------------------
Total liabilities and equity		40,728,842	39,459,680
		=============	=============

To the best of our knowledge, the condensed consolidated interim financial information presents fairly in all material respects the financial position, results of operations and cashflows of the Group as of, and for, the periods presented therein. The condensed consolidated interim financial information was approved by the Board of Directors and authorised for issue on 17 October 2024.

…………………………. ………………………..…………………….. ………………………………..…………........

Mohammed Bin Saud Al Qasimi Mohamed Khadiri

Chairman CEO

The accompanying notes 1 to 28 form an integral part of these condensed consolidated interim financial information.

Condensed consolidated interim statement of profit or loss (unaudited)

for the nine-month period ended

		Three-month period ended 30 September		Nine-month period ended 30 September
	Note	2024	2023	2024	2023
		AED'000	AED'000	AED'000	AED'000

Interest income		535,625	475,750	1,550,089	1,287,196
Interest expense		(420,343)	(403,394)	(1,228,792)	(1,115,634)
		-------------------------	-------------------------	-------------------------	-------------------------
Net interest income		115,282	72,356	321,297	171,562
Net fee and commission income		47,370	32,679	121,199	148,657
Exchange profit		5,036	3,753	18,387	11,236
Income/ (loss) on investments		21,633	(6,159)	23,240	(5,987)
Net (loss)/ income on properties		(1,126)	(3,058)	2,806	(5,738)
Other income		123	352	1,447	4,200
		-------------------------	-------------------------	-------------------------	-------------------------
Operating income		188,318	99,923	488,376	323,930
Net impairment reversal/(loss) on financial assets	18	5,803	(797)	9,499	2,076
		-------------------------	-------------------------	-------------------------	-------------------------
Net operating income		194,121	99,126	497,875	326,006
Personnel expenses		(24,844)	(37,786)	(90,307)	(114,786)
Depreciation		(6,064)	(6,301)	(18,416)	(20,123)
Other expenses		(26,316)	(33,585)	(68,844)	(96,000)
Impairment of intangible assets		-	-	-	(18,365)
Net impairment charge on subsidiary held for sale	2.1	-	-	-	(199,153)
		-------------------------	-------------------------	-------------------------	-------------------------
Profit/ (loss) before tax		136,897	21,454	320,308	(122,421)
Income tax expense	26	(12,249)	-	(24,690)	-
		-------------------------	-------------------------	-------------------------	-------------------------
Net profit/ (loss) for the period		124,648	21,454	295,618	(122,421)
		=============	=============	=============	=============
Attributable to:
Equity holders of the Bank		124,895	21,839	296,433	(121,412)
Non-controlling interests		(247)	(385)	(815)	(1,009)
		-------------------------	-------------------------	-------------------------	-------------------------
Net profit/ (loss) for the period		124,648	21,454	295,618	(122,421)
		=============	=============	=============	=============
Basic and diluted earnings per share (AED)	21	0.042	0.007	0.099	(0.049)
		=============	=============	=============	=============

The accompanying notes 1 to 28 form an integral part of these condensed consolidated interim financial information.

Condensed consolidated interim statement of comprehensive income (unaudited)

for the nine-month period ended

	Three-month period ended 30 September		Nine-month period ended 30 September
	2024	2023	2024	2023
	AED'000	AED'000	AED'000	AED'000

Net profit/ (loss) for the period	124,648	21,454	295,618	(122,421)
	----------------------------	----------------------------	----------------------------	----------------------------

Other comprehensive income items
Items that will not be reclassified subsequently to condensed consolidated interim statement of profit or loss:
Net change in fair value of equity instruments measured at fair value through other comprehensive income	(15,615)	(7,236)	(60,823)	(15,156)
Items that may be reclassified subsequently to condensed consolidated interim statement of profit or loss:
Net change in fair value of debt instruments measured at fair value through other comprehensive income, net of ECL (note 18)	17,641	-	17,641	-
Translation differences from a subsidiary	-	-	-	(386,675)
	----------------------------	----------------------------	----------------------------	----------------------------
Other comprehensive income/ (loss) for the period	2,026	(7,236)	(43,182)	(401,831)
	----------------------------	----------------------------	----------------------------	----------------------------

Total comprehensive income/ (loss) for the period	126,674	14,218	252,436	(524,252)
	=============	=============	=============	=============

Attributable to:
Equity holders of the Bank	126,921	14,603	253,251	(523,243)
Non-controlling interests	(247)	(385)	(815)	(1,009)
	----------------------------	----------------------------	----------------------------	----------------------------
Total comprehensive income/ (loss) for the period	126,674	14,218	252,436	(524,252)
	=============	=============	=============	=============

The accompanying notes 1 to 28 form an integral part of these condensed consolidated interim financial information.

Condensed consolidated interim statement of changes in equity for the nine-month period ended 30 September 2024

	Share capital		Statutory reserve		Contingency reserve		Impairment reserve		Investment fair value reserve		Currency translation reserve		Retained earnings		Total equity attributable to equity holders of the Bank		Non-controlling interests		Total equity
	AED'000		AED'000		AED'000		AED'000		AED'000		AED'000		AED'000		AED'000		AED'000		AED'000

Balance at 1 January 2023 (audited)	2,200,000	1,050,000		640,000		147,624		(706,370)		(1,911,502)		71,551		1,491,303		3,053		1,494,356
	----------------------------	----------------------------		----------------------------		----------------------------		----------------------------		----------------------------		----------------------------		----------------------------		----------------------------		----------------------------
Subsidiary held for sale opening balance adjustment (Note 2.1)	-	-		-		-		996		1,911,502		9,591		1,922,089		-		1,922,089
	----------------------------	----------------------------		----------------------------		----------------------------		----------------------------		----------------------------		----------------------------		----------------------------		----------------------------		----------------------------
Balance at 1 January 2023 (adjusted)	2,200,000	1,050,000		640,000		147,624		(705,374)		-		81,142		3,413,392		3,053		3,416,445
	----------------------------	----------------------------		----------------------------		----------------------------		----------------------------		----------------------------		----------------------------		----------------------------		----------------------------		----------------------------
Loss for the period	-	-		-		-		-		-		(121,412)		(121,412)		(1,009)		(122,421)
Other comprehensive loss	-	-		-		-		(15,156)		(386,675)		-		(401,831)		-		(401,831)
	----------------------------	----------------------------		----------------------------		----------------------------		----------------------------		----------------------------		----------------------------		----------------------------		----------------------------		----------------------------
Total comprehensive loss for the period	-	-		-		-		(15,156)		(386,675)		(121,412)		(523,243)		(1,009)		(524,252)
	----------------------------	----------------------------		----------------------------		----------------------------		----------------------------		----------------------------		----------------------------		----------------------------		----------------------------		----------------------------
Transfer to share capital	800,000	-		-		-		-		-		-		800,000		-		800,000
Transfer from retained earnings (note 10)	-	-		-		32,901		-		-		(32,901)		-		-		-
Transfer to retained earnings	-	-		(640,000)		-		-		-		640,000		-		-		-
	----------------------------	----------------------------		----------------------------		----------------------------		----------------------------		----------------------------		----------------------------		----------------------------		----------------------------		----------------------------
Balance at 30 September 2023 (unaudited)	3,000,000	1,050,000		-		180,525		(720,530)		(386,675)		566,829		3,690,149		2,044		3,692,193
	==========	==========		==========		==========		==========		==========		==========		==========		==========		==========
Balance at 1 January 2024 (audited)	3,000,000	1,050,000		-		190,316		(754,382)		(386,675)		404,932		3,504,191		1,324		3,505,515
	----------------------------	----------------------------		----------------------------		----------------------------		----------------------------		----------------------------		----------------------------		----------------------------		----------------------------		----------------------------
Profit/ (loss) for the period	-	-		-		-		-		-		296,433		296,433		(815)		295,618
Other comprehensive loss	-	-		-		-		(43,182)		-		-		(43,182)		-		(43,182)
	----------------------------	----------------------------		----------------------------		----------------------------		----------------------------		----------------------------		----------------------------		----------------------------		----------------------------		----------------------------
Total comprehensive (loss)/profit for the period	-	-		-		-		(43,182)		-		296,433		253,251		(815)		252,436
	----------------------------	----------------------------		----------------------------		----------------------------		----------------------------		----------------------------		----------------------------		----------------------------		----------------------------		----------------------------
Adjustment on disposal of FVOCI investment	-	-		-		-		-		-		421		421		-		421
Transfer from retained earnings (note 10)	-	-		-		8,823		-		-		(8,823)		-		-		-
	----------------------------	----------------------------		----------------------------		----------------------------		----------------------------		----------------------------		----------------------------		----------------------------		----------------------------		----------------------------
Balance at 30 September 2024 (unaudited)	3,000,000	1,050,000		-		199,139		(797,564)		(386,675)		692,963		3,757,863		509		3,758,372
	==========	==========		==========		==========		==========		==========		==========		==========		==========		==========

The accompanying notes 1 to 28 form an integral part of these condensed consolidated interim financial information.

Condensed consolidated interim statement of cash flows (unaudited)

for the nine-month period ended 30 September 2024

	2024	2023
	AED'000	AED'000
Cash flows from operating activities
Net profit/ (loss) before tax for the period	320,308	(122,421)
Adjustments for:
Depreciation of property and equipment	18,416	20,123
Impairment of other intangible assets	-	18,365
Amortisation /(discount) on debt	199	(39,153)
Gain on sale on property and equipment	(792)	(2,619)
(Gain)/loss on sale of assets acquired in settlement of debts	(3,738)	221
Net fair value loss on issued debt securities	-	4,839
Net fair value gain on interest rate swaps	-	(4,839)
Net fair value changes on other financial assets at FVTPL	(17,394)	19,600
Realised gain on financial assets	(5,026)	-
Unrealized gain on assets acquired in settlement of debts	(1,781)	-
Unrealized gain on investment properties	(3,950)	-
Net impairment reversal on financial assets	(9,499)	(2,076)
Net impairment charge on assets held for sale	-	199,153
Dividends income	(1,097)	(13,161)
	---------------------	---------------------
Operating profit before changes in operating assets and liabilities	295,646	78,032
Changes in Deposits and balances due from banks maturing after three months from dates of placements	198,467	40,796
Statutory deposits with central banks	127,707	(526,777)
Loans and advances	(1,318,513)	(411,527)
Other assets	297,151	(126,036)
Customers' deposits	1,178,922	264,453
Other liabilities	(672,236)	(38,608)
	---------------------	---------------------
Net cash generated from/ (used in) operating activities	107,144	(719,667)
	---------------------	---------------------
Cash flows from investing activities
Purchase of property and equipment	(5,185)	(11,916)
Purchase of financial assets	(1,292,108)	(2,661)
Proceeds from sale of assets acquired as settlement of debt	2,000	37,710
Proceeds from sale of property and equipment	-	13,885
Proceeds from disposal of investments	114,267	88,690
Proceeds from disposal of fixed assets	5,331	-
Dividends received	1,097	13,161
	---------------------	---------------------
Net cash (used in)/ generated from investing activities	(1,174,598)	138,869
	---------------------	---------------------
Cash flows from financing activities
Proceeds from issued bond	1,818,484	1,808,732
Proceeds from issuance of shares	-	800,000
Proceeds from/ (settlement of) repo borrowings and due to banks	2,379,484	(2,600,000)
Settlement of issued bonds	(2,247,189)	(459,125)
	---------------------	---------------------
Net cash generated from/ (used in) financing activities	1,950,779	(450,393)
	---------------------	---------------------

Net increase/ (decrease) in cash and cash equivalents	883,325	(1,031,191)
Cash and cash equivalents at the beginning of the period	2,395,016	3,316,606
	---------------------	---------------------
Cash and cash equivalents at the end of the period (Note 8)	3,278,341	2,285,415
	===========	===========

The accompanying notes 1 to 28 form an integral part of these condensed consolidated interim financial information.

Notes to the condensed consolidated interim financial information

for the nine-month period ended 30 September 2024 (unaudited)

1. General information

Bank of Sharjah P.J.S.C. (the "Bank"), is a public joint stock company incorporated by an Amiri Decree issued on 22 December 1973 by His Highness The Ruler of Sharjah and was registered in February 1993 under the Commercial Companies Law Number 8 of 1984 (as amended). The Bank commenced its operations under a banking license issued by the United Arab Emirates Central Bank dated 26 January 1974. The Bank is engaged in commercial and investment banking activities.

The Bank's registered office is located at Al Khan Road, P.O. Box 1394, Sharjah, United Arab Emirates. The Bank operates through six branches in the United Arab Emirates located in the Emirates of Sharjah, Dubai, Abu Dhabi, and City of Al Ain. The accompanying condensed consolidated interim financial information combine the activities of the Bank and its subsidiaries (collectively the "Group").

2. Basis of preparation

2.1 Subsidiary held for sale

The Central Bank of the UAE supports the Bank's strategic effort to delink/deconsolidate its Lebanese Subsidiary, as the underlying accounting anomalies impact is not sustainable for the Bank and pose a threat for even greater unnecessary volatility. Accordingly, the ultimate immediate objective was to cease the consolidation of the Lebanese Subsidiary financial statements in the Group's financial statements as per the Central Bank of the UAE recommendations effective 1 April 2023. This is required in order to avoid the unnecessary accounting anomalies and/or disruptions resulting from the consolidation of the Lebanese Subsidiary. On 22 June 2023, the board approved the de-linking.

When the Group has classified the Lebanese subsidiary as an "asset held for sale", all the assets and liabilities of that subsidiary were classified as held for sale. After it is classified in this category, the group of assets and liabilities are measured at the lower of carrying amount or fair value less costs to sell. If the group of assets and liabilities becomes impaired, an impairment loss is recognised in the condensed consolidated interim statement of profit and loss. Impairment losses may be reversed. The fair value less cost to sell estimate is a significant judgement and it is determined based on the market offer approach.

Due to circumstances beyond the Bank's control, notably the heightened geopolitical situation in Lebanon, the sale could not be completed within the 12-month timeframe stipulated by IFRS 5. However, the sale has been delayed as the buyer is waiting for the improvement in the economic conditions in Lebanon. During the 9-month period ended 30 September 2024, the Bank has received offers from potential buyers with the intention to acquire the subsidiary at re-confirmed offer prices and they remain interested in proceeding with the acquisition, pending improvements in the geo-political situation in the region. The Bank is in the process of obtaining an updated valuation, including revised offers for the sale of the subsidiary, before a deal can be finalised.

While we are confident of the successful sale of Emirates Lebanon Bank, delays may occur due to unforeseen events or circumstances beyond the bank's control. During the current period, the Bank has also obtained a letter from the regulator affirming support for the classification of EL Bank as held for sale under IFRS 5, due to the heightened geopolitical situation in the region.

2. Basis of preparation (continued)

2.1 Subsidiary held for sale (continued)

The breakdown of the Lebanese subsidiary's net assets as at 1 April 2023 is as follows:


ASSETS		AED'000
Cash and balances with central bank		2,892,460
Deposits and balances due from banks		10,497
Loans and advances, net		1,090,017
Investments measured at fair value		29,567
Investments measured at amortised cost		43,344
Other intangibles		345
Assets acquired in settlement of debt		79,641
Other assets		17,989
Property and equipment		6,040
		------------------------
Total assets		4,169,900
		------------------------
LIABILITIES
Customers' deposits		2,318,968
Deposits and balances due to banks		617,261
Other liabilities		189,728
		------------------------
Total liabilities		3,125,957
		------------------------
Net assets		1,043,943
		==========

Fair value of net assets 844,790

==========

2.2 Basis of preparation

These condensed consolidated interim financial information have been prepared in accordance with IAS 34 Interim Financial Reporting. The accounting policies used in the preparation of this condensed consolidated interim financial information is consistent with those used in the audited annual consolidated financial statements for the year ended 31 December 2023. This condensed consolidated interim financial information does not include all the information and disclosures required in full consolidated financial statements and should be read in conjunction with the Group's consolidated financial statements for the year ended 31 December 2023. In addition, results for the period from 1 January 2024 to 30 September 2024 are not necessarily indicative of the results that may be expected for the financial year ending 31 December 2024.

Basis of measurement - The condensed consolidated interim financial information has been prepared on the historical cost basis except for certain financial instruments and investment properties that are measured at fair values as explained in the accounting policies below.

Functional and presentation currency - The condensed consolidated interim financial information is presented in Arab Emirates Dirham (AED) and all values are rounded to the nearest thousands' dirham, except when otherwise indicated.

Basis of consolidation - This condensed consolidated interim financial information incorporates the condensed interim financial information of the Bank and entities controlled by the Bank. Control is achieved when the Bank has:

§ power over the investee,

§ exposure, or has rights, to variable returns from its involvement with the investee; and

§ the ability to use its power over the investee to affect its returns.

2. Basis of preparation (continued)

2.2 Basis of preparation (continued)

The condensed consolidated interim financial information comprises the financial statements of the Bank and of the following subsidiaries. The financial statements of the subsidiaries are prepared for the same reporting period as that of the Bank, using consistent accounting policies.

All intragroup assets, liabilities, equity, income, expenses and cash flows relating to transactions between entities of the Group are eliminated in full on consolidation.

Changes in the Group's ownership interests in subsidiaries that do not result in the Group losing control over the subsidiaries are accounted for as equity transactions. The carrying amounts of the Group's interests and the non-controlling interests are adjusted to reflect the changes in their relative interests in the subsidiaries.

Any difference between the amount by which the non-controlling interests are adjusted and the fair value of the consideration paid/payable or received/receivable is recognised directly in equity and attributed to owners of the Group.

The Bank's interests, held directly or indirectly, in the subsidiaries are as follows:


Name of Subsidiary		Proportion of ownership interest			Year of incorporation	Country of incorporation	Principal activities
		2024	2023
Emirates Lebanon Bank S.A.L.	100%		100%	1965		Lebanon	Financial institution
EL Capital FZC	100%		100%	2007		U.A.E.	Investment in a financial institution
BOS Real Estate FZC	100%		100%	2007		U.A.E.	Real estate development activities
BOS Capital FZC	100%		100%	2007		U.A.E.	Investment
Polyco General Trading L.L.C.	100%		100%	2008		U.A.E.	General trading
Borealis Gulf FZC	100%		100%	2010		U.A.E.	Investment & Real estate development activities
BOS Funding Limited	100%		100%	2015		Cayman Islands	Financing activities
Muwaileh Capital FZC	90%		90%	2010		U.A.E.	Developing of real estate & related activities
BOS Repos Limited	100%		100%	2018		Cayman Islands	Financing activities
BOS Derivatives Limited	100%		100%	2018		Cayman Islands	Financing activities
GTW Holding LTD	100%		100%	2022		U.A.E. (ADGM)	Facilitate the sale of real estate assets
GDLR Holding LTD	100%		100%	2022		U.A.E. (ADGM)	Facilitate the sale of real estate assets
BOS Real Estate Egypt	100%		100%	2023		Egypt	Real estate development activities

3. Application of other new and revised International Financial Reporting Standards ("IFRS")

Relevant new and revised IFRS applied with no material effect on the Group condensed consolidated interim financial information.

The following new and revised IFRS have been adopted in this condensed consolidated interim financial information. The application of these new and revised IFRS has not had any material impact on the amounts reported for the current and prior periods.

Effective for annual periods beginning on or after
1 January 2024	Classification of Liabilities as Current or Non-Current Liabilities with Covenants (Amendments to IAS 1)
1 January 2024	Supplier Finance Arrangements (Amendments to IAS 7 and IFRS 7)
1 January 2024	Lease Liability in a Sale and Leaseback (Amendments to IFRS 16)

4. Financial risk management

The Group's financial risk management objectives and policies are consistent with those disclosed in the consolidated financial statements as at and for the year ended 31 December 2023.

5 Financial instruments

5.1 Recognition and Initial Measurement

A financial instrument is any contract that gives rise to both a financial asset for the Group and a financial liability or equity instrument for another party or vice versa. All regular way purchases or sales of financial assets are recognised and derecognised on a trade date basis. Regular way purchases or sales are purchases or sales of financial assets that require delivery of assets within the time frame established by regulation or convention in the marketplace. Recognised financial assets and financial liabilities are initially measured at fair value. Transaction costs that are directly attributable to the acquisition or issue of financial assets and financial liabilities (other than financial assets and financial liabilities at FVTPL) are added to or deducted from the fair value of the financial assets or financial liabilities respectively, as appropriate, on initial recognition. Transaction costs directly attributable to the acquisition of financial assets or financial liabilities at FVTPL are recognised immediately in consolidated statement of profit or loss.

5.2 Classification of financial assets

Balances with central banks, due from banks and financial institutions, financial assets and certain items in receivables and other assets that meet the following conditions are subsequently measured at amortised cost less impairment loss and deferred income, if any (except for those assets that are designated as at fair value through profit or loss on initial recognition). IFRS 9 contains three principal classification categories for financial assets: measured at amortized cost, fair value through other comprehensive income (FVOCI) and fair value through profit or loss (FVTPL). On initial recognition, a financial asset is classified as measured at: amortised cost, FVOCI or FVTPL.

A financial asset is measured at amortised cost if it meets both of the following conditions and is not designated as at FVTPL:

· the asset is held within a business model whose objective is to hold assets to collect contractual cash flows; and

· the contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding.

5 Financial instruments (continued)

5.2 Classification of financial assets (continued)

A debt instrument is measured at FVOCI only if it meets both of the following conditions and is not designated as at FVTPL:

· the asset is held within a business model whose objective is achieved by both collecting contractual cash flows and selling financial assets; and

· the contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding.

On initial recognition of an equity investment that is not held for trading, the Bank may irrevocably elect to present subsequent changes in fair value in OCI. This election is made on an investment-by-investment basis. In addition, on initial recognition the Bank may irrevocably designate a financial asset that otherwise meets the requirements to be measured at amortised cost or at FVOCI as at FVTPL if doing so eliminates or significantly reduces an accounting mismatch that would otherwise arise.

Financial assets measured at amortised cost

The effective interest rate method is a method of calculating the amortised cost of those financial instruments measured at amortised cost and of allocating income over the relevant period. The effective interest rate is the rate that is used to calculate the present value of the estimated future cash receipts (including all fees and points paid or received that form an integral part of the effective interest rate, transaction costs and other premiums or discounts) through the expected life of the financial instruments, or, where appropriate, a shorter period, to arrive at the net carrying amount on initial recognition. Income is recognised in the consolidated statement of profit or loss on an effective interest rate basis for financing and investing instruments measured subsequently at amortised cost.

Financial assets measured at FVTPL

Investments in equity instruments are classified as financial assets measured at FVTPL, unless the Group designates fair value through other comprehensive income (FVTOCI) at initial recognition. Financial assets that do not meet the amortised cost criteria described above, or that meet the criteria but the Group has chosen to designate it as at FVTPL at initial recognition, are measured at FVTPL. Financial assets (other than equity instruments) may be designated at FVTPL upon initial recognition if such designation eliminates or significantly reduces a measurement or recognition inconsistency that would arise from measuring assets or liabilities or recognizing the gains or losses on them on different basis.

Financial assets are reclassified from amortised cost to FVTPL when the business model is changed such that the amortised cost criteria are no longer met. Reclassification of financial assets (other than equity instruments) designated as at FVTPL at initial recognition is permitted.

Financial assets measured at FVTPL are measured at fair value at the end of each reporting period, with any gains or losses arising on re-measurement recognised in the consolidated statement of profit or loss at the end of each reporting period. The net gain or loss recognised in the consolidated statement of profit or loss.

Financial assets measured at FVTOCI

On initial recognition, the Group can make an irrevocable election (on an instrument-by-instrument basis) to designate investments in equity instruments as at FVTOCI. Designation at FVTOCI is not permitted if the equity investment is held for trading. A financial asset is held for trading if:

· it has been acquired principally for the purpose of selling it in the near term;

· on initial recognition it is part of a portfolio of identified financial instruments that the Group manages together and has evidence of a recent actual pattern of short-term profit-taking; or

· it is a derivative that is not designated and effective as a hedging instrument or a financial guarantee.

Investments in equity instruments at FVTOCI are initially measured at fair value plus transaction costs. Subsequently, they are measured at fair value with gains and losses arising from changes in fair value recognised in other comprehensive income and accumulated in the investments fair value reserve. Where the asset is disposed of, the cumulative gain or loss previously accumulated in the investments fair value reserve is not transferred to consolidated statement of profit or loss.

5 Financial instruments (continued)

5.3 Measurement of ECL

Credit loss allowances are measured using a three-stage approach based on the extent of credit deterioration since origination:

• Stage 1 - Where there has not been a significant increase in credit risk (SICR) since initial recognition of a financial instrument, an amount equal to 12 months expected credit loss is recorded. The expected credit loss is computed using a probability of default occurring over the next 12 months. For those instruments with a remaining maturity of less than 12 months, a probability of default corresponding to remaining term to maturity is used.

• Stage 2 - When a financial instrument experiences a SICR subsequent to origination but is not considered to be in default, it is included in Stage 2. This requires the computation of expected credit loss based on the probability of default over the remaining estimated life of the financial instrument.

• Stage 3 - Financial instruments that are considered to be in default are included in this stage. Similar to Stage 2, the allowance for credit losses captures the lifetime expected credit losses.

ECLs are an unbiased probability‐weighted estimate of the present value of credit losses that is determined by evaluating a range of possible outcomes. For funded exposures, ECL is measured as follows:

· for 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 arising from the weighting of multiple future economic scenarios, discounted at the asset's effective interest rate (EIR);

· 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.

However, for unfunded exposures, ECL is measured as follows:

For undrawn loan commitments, as the present value of the difference between the contractual cash flows that are due to the Group if the holder of the commitment draws down the loan and the cash flows that the Group expects to receive if the loan is drawn down; and for financial guarantee contracts, the expected payments to reimburse the holder of the guaranteed debt instrument less any amounts that the Group expects to receive from the holder, the debtor or any other party.

The Group measures ECL on an individual basis, or on a collective basis for portfolios of loans that share similar economic and credit risk characteristics. The measurement of the loss allowance is based on the present value of the asset's expected cash flows using the asset's original EIR, regardless of whether it is measured on an individual basis or a collective basis.

The key inputs into the measurement of ECL are the term structure of the following variables:

· probability of default (PD)

· loss given default (LGD)

· exposure at default (EAD)

These parameters are generally derived from internally developed statistical models and other historical data. They are adjusted to reflect forward-looking information.

5 Financial instruments (continued)

5.3 Measurement of ECL (continued)

Assessment of significant increase in credit risk

The assessment of a significant increase in credit risk is done on a relative basis. To assess whether the credit risk on a financial asset has increased significantly since origination, the Group compares the risk of default occurring over the expected life of the financial asset at the reporting date to the corresponding risk of default at origination, using key risk indicators that are used in the Group's existing risk management processes. At each reporting date, the assessment of a change in credit risk will be individually assessed for those considered individually significant. This assessment is symmetrical in nature, allowing credit risk of financial assets to move back to Stage 1, if certain criteria are met, if the increase in credit risk since origination has reduced and is no longer deemed to be significant.

The Group assesses whether credit risk has increased significantly since initial recognition at each reporting date. Determining whether an increase in credit risk is significant depends on the characteristics of the financial instrument and the borrower, and the geographical region. What is considered significant differs for different types of lending, in particular between wholesale and retail.

The Group monitors the effectiveness of the criteria used to identify significant increases in credit risk by regular reviews to confirm that:

· the criteria are capable of identifying significant increases in credit risk before an exposure is in default;

· the criteria do not align with the point in time when an asset becomes 30 days past due;

· the average time between the identification of a significant increase in credit risk and default appears reasonable;

· exposures are not generally transferred directly from 12-month ECL measurement to credit impaired; and

· there is no unwarranted volatility in loss allowance from transfers between 12-month PD [stage 1] and lifetime PD [stage 2].

When determining whether the risk of default on a financial instrument has increased significantly since initial recognition, the Group considers reasonable and supportable information that is relevant and available without undue cost or effort. This includes both quantitative and qualitative information and analysis, based on the Group's historical experience and expert credit assessment and including forward-looking information.

The objective of the assessment is to identify whether a significant increase in credit risk has occurred for an exposure by comparing:

· The remaining lifetime probability of default (PD) as at the reporting date; with

· The remaining lifetime PD for this point in time that was estimated at the time of initial recognition of the exposure (adjusted where relevant for changes in prepayment expectations)

The Group uses three criteria for determining whether there has been a significant increase in credit risk:

· quantitative test based on movement in PD;

· quantitative indicators

· a backstop of 30 days past due.

Improvement in credit risk profile

If there is evidence that there is no longer a significant increase in credit risk relative to initial recognition, then the loss allowance on an instrument returns to being measured as 12-month ECL. The Group has defined below criteria in accordance with regulatory guidelines to assess any improvement in the credit risk profile which will result into upgrading of customers moving from Stage 3 to Stage 2 and from Stage 2 to Stage 1.

· Significant decrease in credit risk will be upgraded stage-wise (one stage at a time) from Stage 3 to Stage 2 after and from Stage 2 to Stage 1 after meeting the curing period of at least 12 months.

· Restructured cases will be upgraded if repayments of 3 instalments (for quarterly instalments) have been made or 12 months (for instalments longer than quarterly) curing period is met.

5 Financial instruments (continued)

5.3 Measurement of ECL (continued)

Definition of default

The Bank considers a financial asset to be in default when:

· the borrower is unlikely to pay its credit obligations to the Bank in full without recourse by the Bank to actions such as realising security (if any is held);

· the borrower is past due more than 90 days on any material credit obligation to the Bank; or

· it is becoming probable that the borrower will restructure the asset as a result of bankruptcy due to the borrower's inability to pay its credit obligations.

Overdrafts are considered as being past due once the customer has breached an advised limit or been advised of a limit smaller than the current amount outstanding.

In assessing whether a borrower is in default, the Bank considers indicators that are:

· qualitative - e.g. breaches of covenant;

· quantitative - e.g. overdue status and non-payment on another obligation of the same issuer to the Bank; and

· based on data developed internally and obtained from external sources.

Inputs into the assessment of whether a financial instrument is in default and their significance may vary over time to reflect changes in circumstances.

Presentation of allowance for ECL in the statement of financial position

Loss allowances for ECL are presented in the statement of financial position as follows:

· financial assets measured at amortised cost: (as a deduction from the gross carrying amount of the assets);

· where a financial instrument includes both a drawn and an undrawn component, and the Group cannot identify the ECL on the loan commitment component separately from those on the drawn component: The Group presents a combined loss allowance for both components. The combined amount is presented as deduction from the gross carrying amount of the drawn component.

· debt instruments measured at FVOCI: no loss allowance is recognised in the statement of financial position because the carrying amount of these assets is their fair value. However, the loss allowance is disclosed and is recognised in the statement of profit or loss.

5.4 Financial liabilities

Financial liabilities are classified as either financial liabilities 'at FVTPL' or 'amortised cost'. The Group initially recognises financial liabilities such as deposits and debt securities issued on the date at which they are originated. All other financial liabilities (including liabilities designated at fair value through profit or loss) are initially recognised on the trade date at which the Group becomes party to the contractual provision of the instrument.

Financial liabilities at FVTPL

Financial liabilities are classified at FVTPL where the financial liability is either held for trading or it is designated at FVTPL and measured at fair value. Determination is made at initial recognition and is not reassessed. Financial liabilities at FVTPL are stated at fair value, with any gains / losses arising on remeasurement recognised in profit or loss to the extent that they are not part of a designated hedging relationship. The net gain/ loss recognised in consolidated statement of profit or loss incorporates any interest paid on the financial liability. However, for non-derivative financial liabilities that are designated as at FVTPL, the amount of change in the fair value of the financial liability that is attributable to changes in the credit risk of that liability is recognised in OCI, unless the recognition of the effects of changes in the liability's credit risk in OCI would create or enlarge an accounting mismatch in profit or loss. The remaining amount of change

in the fair value of liability is recognised in profit or loss. Changes in fair value attributable to a financial liability's credit risk that are recognised in OCI are not subsequently reclassified to consolidated statement

5. Financial instruments (continued)

5.4 Financial liabilities (continued)

Financial liabilities at FVTPL (continued)

of profit or loss; instead, they are transferred to retained earnings upon derecognition of the financial liability. In making the determination of whether recognising changes in the liability's credit risk in OCI will create or enlarge an accounting mismatch in profit or loss, the Group assesses whether it expects that the effects of changes in the liability's credit risk will be offset in profit or loss by a change in the fair value of another financial instrument measured at FVTPL. This determination is made at initial recognition.

The Group has designated certain financial liabilities as at FVTPL in either of the following circumstances:

- the liabilities are managed, evaluated and reported internally on a fair value basis; or

- the designation eliminates or significantly reduces an accounting mismatch that would otherwise arise.

Financial liabilities at amortized cost

Other financial liabilities, including borrowings, are initially measured at fair value, net of transaction costs. Other financial liabilities are subsequently measured at amortised cost using the effective interest method, with interest expense recognised on an effective yield basis. The effective interest method is a method of calculating the amortised cost of a financial liability and of allocating interest expense over the relevant period. The effective interest rate is the rate that exactly discounts estimated future cash payments through the expected life of the financial liability, or, where appropriate, a shorter period.

De-recognition of financial liabilities

Financial liabilities are derecognised when they are extinguished - that is when the obligation specified in the contract is discharged, cancelled or expired.

5.5 Estimates and judgements

The preparation of condensed consolidated financial information requires management to make judgments, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets and liabilities, income and expense.

Actual results may differ from these estimates. In preparing this condensed consolidated interim financial information, the significant judgments made by management in applying the Group's accounting policies and the key sources of estimation uncertainty were the same as those that were applied to the audited consolidated financial statements as at and for the year ended 31 December 2023.

6. Investment properties

Investment properties are held to earn rental income and/or capital appreciation. Investment properties include cost of initial purchase, developments transferred from property under development, subsequent cost of development, and fair value adjustments. Investment properties are reported at valuation based on fair value at the end of the reporting period. The fair value is determined on a periodic basis by independent professional valuers.

Fair value adjustments on investment property are included in the condensed consolidated interim statement of profit or loss in the period in which these gains or losses arise. Investment properties are derecognised when either they have been disposed of or when the investment property is permanently withdrawn from use and no future economic benefit is expected from its disposal.

The difference between the net disposal proceeds and the carrying amount of the asset is recognised in the condensed consolidated interim statement of profit or loss in the period of derecognition. Transfers are made to or from investment property only when there is a change in use. For a transfer from investment property to owner occupied property, the deemed cost for subsequent accounting is the fair value at the date of change in use. If owner occupied property becomes an investment property, the Group accounts for such property in accordance with the policy stated under property, plant and equipment up to the date of change in use.

7. Assets acquired in settlement of debt

The Group often acquires real estate and other collateral in settlement of certain loans and advances. Such real estate and other collateral are stated at the lower of the net realisable value of the loans and advances and the current fair value of such assets at the date of acquisition. Subsequently, the real estate are measured at lower of carrying amount or fair value, less impairment losses, if any. Gains or losses on disposal and unrealised losses on revaluation are recognised in the condensed consolidated interim statement of profit or loss.

8. Cash and balances with central bank

The analysis of the Group's cash and balances with the central bank is as follows:

	30 September		31 December
	2024		2023
	AED'000		AED'000
Cash and balances with central bank of the UAE	(unaudited)		(audited)

Cash on hand	42,270	45,336
Statutory deposits	192,949	320,656
Current accounts	3,518,367	4,192,303
	----------------------------	----------------------------
	3,753,586	4,558,295
	=============	=============

The reserve requirements which are kept with the Central Bank of the country in which the Group operates are not available for use in the Group's day to day operations and cannot be withdrawn without the approval of the Central Bank. The level of reserves required changes periodically in accordance with the directive of the respective Central Bank.

Cash and cash equivalents

For the statement of condensed consolidated interim statement of cash flows, cash and cash equivalents includes:

	30 September	30 September
	2024	2023
	AED'000	AED'000
	(unaudited)	(unaudited)

Cash and balances with central bank (Note 8)	3,753,586	3,291,734
Deposits and balances due from banks (Note 9)	686,628	797,317
Deposits and balances due to banks (Note 14)	(1,976,362)	(631,361)
Repo borrowings (Note 15)	(995,328)	-
	----------------------------	----------------------------
	1,468,524	3,457,690
Less: Deposits with central banks and balances due from banks - original maturity more than three month	(376,718)	(550,950)
Less: Statutory deposits with central banks (Note 8)	(192,948)	(621,325)
Add: Deposits and balances due to banks - original maturity more than three month	1,752,275	-
Add: Repo borrowings - original maturity more than three month	627,208	-
	----------------------------	----------------------------
	3,278,341	2,285,415
	=============	=============

Approximately AED 1.6 billion (31 December 2023: AED 1.6 billion) of Repo borrowing have not been deducted from cash and cash equivalents as at 30 September 2024. Considering the underlying substance of the borrowing and nature of the underlying collateral, the Group has classified the proceeds/ repayments from the Repo borrowing as a cash inflow/ outflow from financing activities. (note 15)

9. Deposits and balances due from banks

The analysis of the Group's deposits and balances due from banks is as follows:

	30 September	31 December
	2024	2023
	AED'000	AED'000
	(unaudited)	(audited)

Demand	305,310	176,030
Time	381,318	575,185
	----------------------------	----------------------------
	686,628	751,215
Expected credit losses (note 18)	(132,506)	(132,582)
	----------------------------	----------------------------
	554,122	618,633
	=============	=============

The geographical analysis of deposits and balances due from banks is as follows:

	30 September	31 December
	2024	2023
	AED'000	AED'000
	(unaudited)	(audited)

Banks abroad	672,803	738,197
Banks in the U.A.E.	13,825	13,018
	----------------------------	----------------------------
	686,628	751,215
Expected credit losses (note 18)	(132,506)	(132,582)
	----------------------------	----------------------------
	554,122	618,633
	=============	=============

10. Loans and advances, net

(a) The analysis of the Group's loans and advances measured at amortised cost is as follows:

	30 September	31 December
	2024	2023
	AED'000	AED'000
	(unaudited)	(audited)

Overdrafts	6,345,997	4,663,532
Commercial loans	15,598,446	14,715,439
Bills discounted	1,316,736	2,085,781
Other advances	1,856,554	2,334,467
	----------------------------	----------------------------
Gross amount of loans and advances net of interest in suspense	25,117,733	23,799,219
Expected credit losses (note 18)	(1,734,971)	(1,731,369)
	----------------------------	----------------------------
Net loans and advances	23,382,762	22,067,850
	=============	=============

(b) Impairment reserve

The CBUAE issued its IFRS 9 guidance on 30 April 2018 via notice no. CBUAE/BSD/2018/458 addressing various implementation challenges and practical implications for banks adopting IFRS 9 in the UAE ("the guidance").

10. Loans and advances, net (continued)

Pursuant to clause 6.4 of the guidance, the reconciliation between general and specific provision under Circular 28/2010 of CBUAE and IFRS 9 is as follows:

		30 September	31 December
		2024	2023
		AED'000	AED'000
		(unaudited)	(audited)
Impairment reserve - Specific
Specific provisions and interest in suspense under Circular 28/2010 of CBUAE		1,638,156	1,595,006
Stage 3 provisions under IFRS 9**		1,638,156	1,595,006
		-----------------------------	---------------------------
Specific provision transferred to the impairment reserve*		-	-
		=============	=============

		30 September		31 December
		2024		2023
		AED'000		AED'000
	Impairment reserve - Collective	(unaudited)		(audited)
	Collective provisions under Circular 28/2010 of CBUAE	357,414		389,004
	Stage 1 and Stage 2 provisions under IFRS 9**	158,275		198,688
		----------------------------		---------------------------
	Collective provision transferred to the impairment reserve	199,139		190,316
		=============		=============

*In the case where provisions under IFRS 9 exceed provisions under CBUAE, no amount shall be transferred to the impairment reserve.

** For the purpose of calculation, the movement in impairment reserve provisions under IFRS 9 are determined based on CB UAE classification of loans and advances, only for the purpose of this disclosure.

As at 30 September 2024, AED 8.823 million are transferred from retained earnings to impairment reserve (30 September 2023: AED 32.901 million).

	30 September	31 December
	2024	2023
	AED'000	AED'000
	(unaudited)	(audited)

Loans and advances resident in the U.A.E.	24,471,675	23,053,575
Loans and advances non-resident	646,058	745,644
	----------------------------	----------------------------
	25,117,733	23,799,219
	=============	=============

11. Investment Securities, net

	30 September	31 December
	2024	2023
	AED'000	AED'000
Investments measured at fair value	(unaudited)	(audited)
Investments measured at FVTPL
Quoted equity securities	-	134,706
Quoted debt securities	435,267	-
	----------------------------	---------------------------
	435,267	134,706
	----------------------------	---------------------------
Investments measured at FVTOCI
Quoted equity securities	197,310	104,544
Unquoted equity securities	101,474	120,222
Quoted debt securities	887,934	-
	----------------------------	---------------------------
	1,186,718	224,766
	----------------------------	---------------------------
Total investments measured at fair value	1,621,985	359,472
	----------------------------	---------------------------
Investments measured at amortised cost
Quoted debt securities	73,070	190,567
Unquoted debt securities	7,205,345	7,180,970
Expected credit losses (note 18)	(152)	(3,599)
	----------------------------	---------------------------
Total investments measured at amortised cost	7,278,263	7,367,938
	----------------------------	---------------------------
Total Investments	8,900,248	7,727,410
	=============	=============

All of the quoted investments are listed on the securities exchanges in the U.A.E. (Abu Dhabi Securities Exchange and Dubai Financial Market). Included in the debt securities measured at amortised cost are bonds and sukuk with the fair value of AED 3.13 billion (31 December 2023 - AED 2.11 billion) given as collateral against borrowings under repo agreements (note 15).

The composition of the investment measured at fair value and amortised cost by geography is as follows:

	30 September	31 December
	2024	2023
	AED'000	AED'000
	(unaudited)	(audited)

United Arab Emirates	7,545,403	7,434,048
G.C.C countries (other than U.A.E.)	1,296,850	277,623
Middle East (other than G.C.C. countries)	58,036	-
Europe	111	19,338
	----------------------------	---------------------------
	8,900,400	7,731,009
Expected credit losses (note 18)	(152)	(3,599)
	----------------------------	---------------------------
	8,900,248	7,727,410
	=============	=============

12. Other assets

	30 September	31 December
	2024	2023
	AED'000	AED'000
	(unaudited)	(audited)

Acceptances - contra (note 16)	497,976	1,011,401
Interest receivable	186,358	67,595
Prepayments	15,962	9,085
Others	256,592	192,135
	----------------------------	---------------------------
	956,888	1,280,216
Expected credit loss (note 18)	(27,964)	(27,964)
	----------------------------	---------------------------
	928,924	1,252,252
	=============	=============

13. Customers' deposits

	30 September	31 December
	2024	2023
	AED'000	AED'000
	(unaudited)	(audited)

Time deposits	22,434,562	21,656,948
Current and other accounts	4,992,605	4,586,738
Saving accounts	94,352	98,911
	----------------------------	---------------------------
	27,521,519	26,342,597
	=============	=============

14. Deposits and balances due to banks

	30 September	31 December
	2024	2023
	AED'000	AED'000
	(unaudited)	(audited)

Time deposit	1,955,697	1,913,348
Demand deposit	20,665	2,993
	----------------------------	---------------------------
	1,976,362	1,916,341
	=============	=============

The geographical analysis of deposits and balances due to banks is as follows:


	30 September	31 December
	2024	2023
	AED'000	AED'000
	(unaudited)	(audited)

Banks in the U.A.E.	1,034,041	537,960
Banks abroad	942,321	1,378,381
	----------------------------	---------------------------
	1,976,362	1,916,341
	=============	=============

15. Repo borrowing

The analysis of the repo borrowing agreements is as follows:

	30 September	31 December
	2024	2023
	AED'000	AED'000
	(unaudited)	(audited)

Banks in the U.A.E.	2,595,328	1,702,312
	----------------------------	---------------------------
	2,595,328	1,702,312
	=============	=============

The Group entered into repo agreements under which bonds with fair value of AED 3.13 billion (31 December 2023: AED 2.11 billion) were given as collateral against borrowings. The risks and rewards relating to these bonds remain with the Group.

Repo borrowings include an amount of AED 1.6 billion (31 December 2023: AED 1.6 billion) which is represented as part of the group's financing activities in the consolidated statement of cashflows. (note 8)

16. Other liabilities

	30 September	31 December
	2024	2023
	AED'000	AED'000
	(unaudited)	(audited)
Acceptances - contra (note 12)	497,976	1,011,401
Interest payable	474,983	576,165
Unearned income	66,149	143,422
Lease liabilities	56,404	66,456
Provision for employees' end of service benefits	49,269	62,236
Clearing balances	47,035	5,266
Managers' cheques	36,375	26,689
ECL on unfunded exposure (note 18)	27,809	30,263
Tax payable	24,690	-
Accrued expenses	1,826	12,608
Others	33,162	53,411
	1,315,678	1,987,917

17. Issued Bonds

On 18 September 2019, the Bank issued Senior Unsecured Fixed Rate Notes, totalling USD 600 million (equivalent to AED 2,204 million) for a five-year maturity at mid swaps plus 250 basis points, to yield 4.015%, classified at amortized cost. The Notes were issued under the Bank's EMTN Programme which is listed on the Irish Stock Exchange. The Notes were partially redeemed through a tender process on 12 September 2024, with the balance being redeemed on 18 September 2024.

On 14 March 2023, the Bank issued Senior Unsecured Fixed Rate Notes, totalling USD 500 million (equivalent to AED 1,836.5 million) for a five-year maturity at a coupon of 7%, classified at amortized cost. The Notes were issued under the Bank's EMTN Programme which is listed on the Irish Stock Exchange.

On 4 September 2024, the Bank issued Senior Unsecured Fixed Rate Notes, totalling USD 500 million (equivalent to AED 1,836.5 million) for a five-year maturity at a coupon of 5.25%, classified at amortized cost. The Notes were issued under the Bank's EMTN Programme which is listed on the London Stock Exchange's International Securities Market.

18. Net impairment loss on financial assets and credit risk

Allocation of impairment loss as of 30 September 2024 and 31 December 2023 is as follows:

		Stage 1	Stage 2	Stage 3	Total
		AED'000	AED'000	AED'000	AED'000
As at 30 September 2024 (unaudited)
Deposits and balances due from banks		282	12	132,212	132,506
Loans and advances		36,557	1,301,128	397,286	1,734,971
Investments		152	-	-	152
Unfunded exposure		154	27,655	-	27,809
Other assets		27,964	-	-	27,964

Total		65,109	1,328,795	529,498	1,923,402


	Stage 1		Stage 2	Stage 3	Total
	AED'000		AED'000	AED'000	AED'000
As at 31 December 2023 (audited)
Deposits and balances due from banks	357		13	132,212	132,582
Loans and advances	42,570		1,292,551	396,248	1,731,369
Investments	3,599		-	-	3,599
Unfunded exposure	537		29,720	6	30,263
Other assets	27,964		-	-	27,964

Total	75,027		1,322,284	528,466	1,925,777

The movement in impairment loss by financial asset category during the period ended 30 September 2024 is as follows:

	Opening balance	Net charge/ (reversal) during the period	Write off during the period	Closing balance
	AED'000	AED'000	AED'000	AED'000
Deposits and balances due from banks	132,582	(76)	-	132,506
Loans and advances	1,731,369	3,640	(38)	1,734,971
Investments	3,599	(3,447)	-	152
Unfunded exposure	30,263	(2,454)	-	27,809
Other assets	27,964	-	-	27,964
Total	1,925,777	(2,337)	(38)	1,923,402
Charge on FVTOCI Bonds		5,112
Direct Recoveries		(12,272)
Net impairment reversal on financial assets		(9,499)

18. Net impairment loss on financial assets and credit risk (continued)

The movement in impairment loss by financial asset category during the period ended 30 September 2023 is as follows:

	Opening balance	Subsidiary held for sale adjustment	Net charge/ (reversal) during the period	Write off during the period		Closing balance
	AED'000	AED'000	AED'000	AED'000		AED'000
Cash and balances with central banks	153,148	(20,936)	(132,212)	-		-
Deposits and balances due from banks	1,683	(7)	131,940	-		133,616
Loans and advances	1,775,177	(10,576)	(10,651)	(23,725)		1,730,225
Investments	10,720	(6,936)	(427)	-		3,357
Unfunded exposure	33,163	(44)	(71)	-		33,048
Other assets	27,964	-	-	-		27,964
Total	2,001,855	(38,499)	(11,421)		(23,725)	1,928,210
Direct Charge			9,345
Net impairment reversal on financial assets			(2,076)

19. Commitments and contingent liabilities

	30 September	31 December
	2024	2023
	AED'000	AED'000
	(unaudited)	(audited)

Financial guarantees for loans	207,829	207,829
Other guarantees	1,590,100	1,311,368
Letters of credit	346,873	459,086
	---------------------------	---------------------------
	2,144,802	1,978,283
Irrevocable commitments to extend credit	502,022	476,117
	---------------------------	---------------------------
	2,646,824	2,454,400
	=============	=============

20. Related party balances

The Group enters into transactions with companies and entities that fall within the definition of a related party as contained in IAS 24 Related Party Disclosures. Related parties comprise companies under common ownership and/or common management and control, their shareholders and key management personnel. Transactions with associate and other related parties are made on substantially the same terms, as those prevailing at the same time for comparable transactions with external customers and parties. Transactions within the Group and its subsidiaries have been eliminated on consolidation and are not disclosed in this note. The related parties' balances included in the condensed consolidated interim statement of financial position and the significant transactions with related parties are as follows:

	30 September	31 December
	2024	2023
	AED'000	AED'000
	(unaudited)	(audited)

Loans and advances	1,814,687	957,407
Letters of credit, guarantee and acceptances	219,517	225,649
	2,034,204	1,183,056
Collateral deposits	(19,486)	(104)
Expected Credit Losses	(1,964)	(2,066)
Net exposure	2,012,754	1,180,886
Other deposits	5,456,385	5,738,669
Investment in Government of Sharjah sukuk	7,000,000	7,000,000

Transactions during the reporting period

		Nine-month period ended 30 September
		2024		2023
		AED'000		AED'000
		(unaudited)		(unaudited)

	Interest income	369,559		281,985
	Interest expense	407,093		153,126
	Rent expense	6,375		6,375
Compensation of key management personnel:			Nine-month period ended 30 September
			2024		2023
			AED'000		AED'000
			(unaudited)		(unaudited)
Short term benefits			3,704		10,450
End of service benefits			197		792
			----------------------------		----------------------------
Total compensation			3,901		11,242
			=============		=============

21. Earnings per share

Earnings per share is computed by dividing the profit for the period by the weighted average number of shares outstanding during the period as follows:

	Three-month period ended 30 September		Nine-month period ended 30 September
	2024	2023	2024	2023
	(unaudited)	(unaudited)	(unaudited)	(unaudited)
Basic losses per share
Profit/ (loss) available to the owners of the Bank (AED'000)	124,895	21,839	296,433	(121,412)
	============	============	============	============
Weighted average number of shares outstanding during the period (in thousands share)	3,000,000	3,000,000	3,000,000	2,485,294
	============	============	============	============
Basic earnings per share (AED)	0.042	0.007	0.099	(0.049)
	============	============	============	============

As at 30 September 2024 and 30 September 2023, the diluted earnings per share is equal to the basic profit per share as the Group has not issued any financial instruments that should be taken into consideration when the diluted earnings per share is calculated.

22. Segmental information

Operating segments are identified on the basis of internal reports about components of the Group that are regularly reviewed by the chief operating decision maker in order to allocate resources to the segment and to assess its performance.

For operating purposes, the Group is organised into two major business segments:

(i) Commercial Banking, which principally provides loans and other credit facilities, deposits and current accounts for corporate, government, institutional and individual customers; and

(ii) Investment Banking, which involves the management of the Group's investment portfolio.

These segments are the basis on which the Group reports its segment information. Transactions between segments are conducted at rates determined by management, taking into consideration the cost of funds and an equitable allocation of expenses.

The following table presents information regarding the Group's operating segments:

	Commercial	Investment
	Banking	Banking	Unallocated	Total
	AED'000	AED'000	AED'000	AED'000
30 September 2024 (unaudited):

Segment assets	28,188,446	10,851,741	1,688,655	40,728,842
	=============	=============	=============	=============

Segment liabilities	32,591,185	3,561,583	817,702	36,970,470
	=============	=============	=============	=============



31 December 2023 (audited):

Segment assets	28,256,179	9,674,953	1,528,548	39,459,680
	=============	=============	=============	=============
Segment liabilities	30,972,647	4,004,998	976,520	35,954,165
	=============	=============	=============	=============

22. Segmental information (continued)

The following table presents information regarding the Group's operating segments for the nine-month period ended 30 September 2024 (unaudited):

	Commercial	Investment
	Banking	banking	Unallocated*	Total
	AED'000	AED'000	AED'000	AED'000

Operating income
- Net interest income	138,948	182,349	-	321,297
- Net fee and commission income	121,199	-	-	121,199
- Exchange profit	18,387	-	-	18,387
- Income on investments	-	23,240	-	23,240
- - Net income on properties	-	2,806	-	2,806
- Other income	1,447	-	-	1,447
Total operating income	279,981	208,395	-	488,376
Other material non-cash items
- Net impairment reversal on financial assets	12,948	(3,449)	-	9,499
- Depreciation	-	-	(18,416)	(18,416)
- General and administrative expenses	(135,278)	(23,873)	-	(159,151)
- Income tax expense	-	-	(24,690)	(24,690)
Net profit/ (loss) for the period	157,651	181,073	(43,106)	295,618

* Unallocated items comprise mainly head office expenses and tax assets

The following table presents information regarding the Group's operating segments for the nine-month period ended 30 September 2023 (unaudited):

	Commercial	Investment
	Banking	Banking	Unallocated	Total
	AED'000	AED'000	AED'000	AED'000
Revenue from external customers
-Net interest income	67,550	104,012	-	171,562
-Net fee and commission income	148,657	-	-	148,657
-Exchange profit	11,236	-	-	11,236
-Loss on investments	-	(5,987)	-	(5,987)
-Net loss on properties	-	(5,738)	-	(5,738)
-Other income	953	3,247	-	4,200
	---------------------	---------------------	----------------------	------------------
Operating income	228,396	95,534	-	323,930

Other material non-cash items
-Net impairment reversal on financial assets	2,503	(427)	-	2,076
-Depreciation of property and equipment	-	-	(20,123)	(20,123)
-General and administrative expenses	(179,168)	(31,618)	-	(210,786)
-Impairment of intangible assets	-	-	(18,365)	(18,365)
-Net impairment charge on subsidiary held for sale	-	(199,153)	-	(199,153)
	--------------------	--------------------	---------------------	-------------------
Profit/(loss) for the period	51,731	(135,664)	(38,488)	(122,421)
	============	============	============	===========

22. Segmental information (continued)

Revenue reported above represents revenue generated from external customers. There were no inter-segment sales in the period. Transactions between segments, inter-segment cost of funds and allocation of expenses are not determined by management for the purpose of resource allocation. The accounting policies of the reportable segments are the same as the Group's accounting policies as disclosed in the consolidated financial statements for the year ended 31 December 2023. For the purposes of monitoring segment performance and allocating resources between segments:

• All assets are allocated to reportable segments except for property and equipment and certain amounts included in other assets; and

• All liabilities are allocated to reportable segments except for certain amounts included in other liabilities.

23. Fair value of financial instruments

Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. As such, differences can arise between book values and the fair value estimates. Underlying the definition of fair value is the presumption that the Group is a going concern without any intention or requirement to materially curtail the scale of its operation or to undertake a transaction on adverse terms.

Investments held at fair value through profit and loss - Investments held for trading or designated at fair value through profit and loss represent investment securities that present the Group with opportunity for returns through dividend income, trading gains and capital appreciation. Including in these investments listed equity securities for which the fair values are based on quoted prices at close of business as of 30 September 2024, and unlisted bonds for which the fair values are derived from internal valuation performed based on generally accepted pricing models, all inputs used for the valuation are supposed by observable market prices or rates.

Unquoted investments held at fair value through other comprehensive income - The condensed consolidated interim financial information includes holdings in unquoted securities amounting to AED 101 million (31 December 2023: AED 120 million) which are measured at fair value. Fair values are determined in accordance with generally accepted pricing models based on comparable ratios backed by discounted cash flow analysis depending on the investment and industry. The valuation model includes some assumptions that are not supported by observable market prices or rates.

For investments valued using comparable ratios, share prices of comparable companies represent significant inputs to the valuation model. If the share prices of the comparable companies were 5% higher/lower while all other variables were held constant, then the fair value of the securities would increase/decrease by AED 5 million (31 December 2023: AED 6 million). The impact of the change in fair valuation from previously existing carrying amounts have been recognised as a part of cumulative changes in fair value in equity.

23. Fair value of financial instruments (continued)

Fair value of financial instruments carried at amortised cost - Except as detailed in the following table, the management considers that the carrying amounts of financial assets and financial liabilities measured at amortised cost in the condensed consolidated interim financial information approximates their fair values.

		30 September 2024 (unaudited)		31 December 2023 (audited)
		Carrying amount	Fair value	Carrying amount	Fair value
	Level	AED'000	AED'000	AED'000	AED'000

Financial assets
- Investments measured at amortised cost	3	7,278,263	7,274,089	7,367,938	7,363,519
		=============	=============	=============	============
- Loans and advances	3	23,382,762	23,382,762	22,067,850	22,067,850
		=============	=============	=============	============


Financial liabilities
- Customers' deposits	2	27,521,519	27,521,519	26,342,597	26,342,597
		=============	=============	=============	============
- Issued Bonds	2	3,561,583	3,746,772	4,004,998	4,068,946
		=============	=============	=============	============

The fair value for other financial assets measured at amortized cost is based on market prices.

Fair value measurements recognised in the condensed consolidated interim statement of financial position

The following table provides an analysis of financial instruments that are measured subsequent to initial recognition at fair value. They are ranked into levels 1 to 3 based on the degree to which the fair value is observable.

• Level 1 fair value measurements are those derived from quoted prices (unadjusted) in active markets for identical assets or liabilities.

• Level 2 fair value measurements are those derived from inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices, including over-the-counter quoted prices).

• Level 3 fair value measurements are those derived from valuation techniques that include inputs for the asset or liability that are not based on observable market data (unobservable inputs).

23. Fair value of financial instruments (continued)

	Level 1	Level 2			Level 3		Total
	AED'000	AED'000			AED'000		AED'000
At 30 September 2024 (unaudited) Investments measured at fair value
Investment measured at FVTPL
Quoted debt securities	435,267	-		-				435,267

Investments carried at FVTOCI
Quoted equity	197,310	-		-				197,310
Unquoted equity	-	-		101,474				101,474
Quoted debt securities	887,934	-		-				887,934
	------------------	------------------		-------------------				------------------
Total	1,520,511	-		101,474				1,621,985
	==========	==========		===========				===========
Other assets
Positive fair value of derivatives	-		521	-				521
	==========	==========		===========				===========

	Level 1	Level 2			Level 3		Total
	AED'000	AED'000			AED'000		AED'000
At 31 December 2023 (audited) Other financial assets measured at fair value
Investment measured at FVTPL
Quoted equity	134,706	-			-		134,706

Investments carried at FVTOCI
Quoted equity	104,544	-			-		104,544
Unquoted equity	-	-			120,222		120,222
	------------------	------------------			-------------------		------------------
Total	239,250	-			120,222		359,472
	==========	==========			===========		===========
Other assets
Positive fair value of derivatives	-	202				-		202
	==========	==========				===========		===========

There were no transfers between Level 1 and Level 2 during the current period.

Reconciliation of Level 3 fair value measurements of other financial assets measured at fair value:

	30 September	31 December
	2024	2023
	AED'000	AED'000
	(unaudited)	(audited)

Opening balance	120,222	157,058
Subsidiary held for sale adjustment (note 2.1)	-	(66)
Loss recognised in other comprehensive income	(19,225)	-
Other movements	477	(36,770)
Closing balance	101,474	120,222

24. Capital adequacy

Basel III

	30 September 2024	31 December 2023
	AED'000	AED'000
	(unaudited)	(audited)

Capital base

Common Equity Tier 1	3,799,543	3,700,274
Additional Tier 1 capital	-	-

Tier 1 capital	3,799,543	3,700,274
Tier 2 capital	297,845	324,171
Total capital base	4,097,388	4,024,445
Risk-weighted assets:
Credit risk	23,827,606	25,933,669
Market risk	668,650	272,735
Operational risk	1,003,798	1,231,102

Total risk-weighted assets	25,500,054	27,437,506

Capital ratios

Common equity Tier 1 capital ratio	14.9%	13.5%
Tier 1 capital ratio	14.9%	13.5%
Total capital ratio	16.1%	14.7%

25. Risk management

Stage migration for the nine-month period ended 30 September 2024

Scope: All clients

Migration during the period

	Non-credit impaired				Credit impaired
	Stage 1		Stage 2		Stage 3		Total
	Exposure	Impairment allowance	Exposure	Impairment allowance	Exposure	Impairment allowance	Exposure	Impairment allowance
	AED'000	AED'000	AED'000	AED'000	AED'000	AED'000	AED'000	AED'000
Retail banking loans
As of 1 January 2024	2,696,205	1,084	31,346	38	21,938	197	2,749,489	1,319
Transfers from stage 2 to stage 1	275	-	(275)	-	-	-	-	-
Transfers from 1&2 to stage 3	(107)	-	(26)	-	133	-	-	-
Transfers from stage 3	-	-	120	-	(120)	-	-	-
Change in exposure	(136,367)	51	873	85	878	84	(134,616)	220
	-----------------------------	-----------------------------	-----------------------------	-----------------------------	-----------------------------	-----------------------------	-----------------------------	-----------------------------
As of 30 September 2024	2,560,006	1,135	32,038	123	22,829	281	2,614,873	1,539
	=============	=============	=============	=============	=============	=============	=============	=============
Wholesale banking loans
As of 1 January 2024	7,871,898	41,486	11,183,272	1,292,513	1,994,560	396,051	21,049,730	1,730,050
Transfers from stage 1 to stage 2	(123,323)	(3,606)	123,323	3,606	-	-	-	-
Transfers from stage 2 to stage 1	826,831	101	(826,831)	(101)	-	-	-	-
Transfers from 1&2 to stage 3	(4,929)	(16)	-	-	4,929	16	-	-
Transfers from stage 3	-	-	-	-	-	-	-	-
Change in exposure	586,910	(2,543)	803,764	4,988	62,456	937	1,453,130	3,382
	-----------------------------	-----------------------------	-----------------------------	-----------------------------	-----------------------------	-----------------------------	-----------------------------	-----------------------------
As of 30 September 2024	9,157,387	35,422	11,283,528	1,301,006	2,061,945	397,004	22,502,860	1,733,432
	=============	=============	=============	=============	=============	=============	=============	=============
Total	11,717,393	36,557	11,315,566	1,301,129	2,084,774	397,285	25,117,733	1,734,971
	=============	=============	=============	=============	=============	=============	=============	=============

25. Risk management (continued)

Stage migration for the nine-month period ended 30 September 2023

Scope: All clients

Migration during the period

	Non-credit impaired				Credit impaired
	Stage 1		Stage 2		Stage 3		Total
	Exposure	Impairment allowance	Exposure	Impairment allowance	Exposure	Impairment allowance	Exposure	Impairment allowance
	AED'000	AED'000	AED'000	AED'000	AED'000	AED'000	AED'000	AED'000
Retail banking loans
As of 1 January 2023	1,860,764	7,752	4,276	46	22,223	371	1,887,263	8,169
Subsidiary held for sale adjustment (note 2.1)	)390(	)50(	-	)1(	)162(	)146(	)552(	)197(
Transfers from stage 1 to stage 2	(5,335)	-	5,335	-	-	-	-	-
Transfers from stage 2 to stage 1	-	-	-	-	-	-	-	-
Transfers from 1&2 to stage 3	(60)	-	(165)	-	225	-	-	-
Transfers from stage 3	17	-	-	-	(17)	-	-	-
Change in exposure	906,304	(5,205)	(5,176)	20	(4,220)	219	896,908	(4,966)
	-----------------------------	-----------------------------	-----------------------------	-----------------------------	-----------------------------	-----------------------------	-----------------------------	-----------------------------
As of 30 September 2023	2,761,300	2,497	4,270	65	18,049	444	2,783,619	3,006
	=============	=============	=============	=============	=============	=============	=============	=============
Wholesale banking loans
As of 1 January 2023	10,223,096	73,019	10,007,034	1,297,568	1,281,051	396,421	21,511,181	1,767,008
Subsidiary held for sale adjustment (note 2.1)	)33,173(	)103(	)11,437(	)1,683(	)14,482(	)8,594(	)59,092(	)10,380(
Transfers from stage 1 to stage 2	(625,095)	(23,735)	625,095	23,735	-	-	-	-
Transfers from stage 2 to stage 1	133,968	3,170	(133,968)	(3,170)	-	-	-	-
Transfers from 1&2 to stage 3	(120,874)	(203)	(212,064)	(7,123)	332,938	7,326	-	-
Transfers from stage 3	-	-	-	-	-	-	-	-
Change in exposure	(523,541)	6,448	(90,120)	(32,285)	187,925	(3,572)	(425,736)	(29,409)
	-----------------------------	-----------------------------	-----------------------------	-----------------------------	-----------------------------	-----------------------------	-----------------------------	-----------------------------
As of 30 September 2023	9,054,381	58,596	10,184,540	1,277,042	1,787,432	391,581	21,026,353	1,727,219
	=============	=============	=============	=============	=============	=============	=============	=============
Total	11,815,681	61,093	10,188,810	1,277,107	1,805,481	392,025	23,809,972	1,730,225
	=============	=============	=============	=============	=============	=============	=============	=============

25. Risk management (continued)

ECL charge/(flow) for the nine-month period ended 30 September 2024

Scope: All clients

	Non-credit impaired		Credit impaired
	Stage 1	Stage 2	Stage 3	Total
	AED'000	AED'000	AED'000	AED'000
Retail banking loans:
ECL allowance as of 1 January 2024	1,084	38	197	1,319
Others	51	85	84	220
	----------------------	----------------------	----------------------	----------------------
ECL allowance as of 30 September 2024	1,135	123	281	1,539
	==========	==========	==========	==========
Wholesale banking loans:
ECL allowance as of 1 January 2024	41,486	1,292,513	396,051	1,730,050
Emirates governments	(322)	-	-	(322)
GREs (Gov ownership >50%)	(858)	-	-	(858)
Other corporates	(8,095)	6,938	55	(1,102)
High net worth individuals	(66)	362	17	313
SMEs	434	1,192	882	2,508
Banks	2,843	-	-	2,843
	----------------------	----------------------	----------------------	----------------------
ECL allowance as of 30 September 2024	35,422	1,301,005	397,005	1,733,432
	==========	==========	==========	==========
	36,557	1,301,128	397,286	1,734,971
	==========	==========	==========	==========

ECL charge/(flow) for the nine-month period ended 30 September 2023

Scope: All clients

	Non-credit impaired		Credit impaired
	Stage 1	Stage 2	Stage 3	Total
	AED'000	AED'000	AED'000	AED'000
Retail banking loans:
ECL allowance as of 1 January 2023	7,752	46	371	8,169
Subsidiary held for sale adjustment (note 2.1)	)50(	)1(	)146(	)197(
Others	(5,205)	20	219	(4,966)
	----------------------	----------------------	----------------------	----------------------
ECL allowance as of 30 September 2023	2,497	65	444	3,006
	==========	==========	==========	==========
Wholesale banking loans:
ECL allowance as of 1 January 2023	73,019	1,297,568	396,421	1,767,008
Subsidiary held for sale adjustment (note 2.1)	)103(	)1,683(	)8,594(	)10,380(
Emirates governments	1,419	-	-	1,419
GREs (Gov ownership >50%)	4,536	-	-	4,536
Other corporates	(16,125)	1,681	2,453	(11,991)
High net worth individuals	(78)	(22,772)	4,698	(18,152)
SMEs	(4,072)	2,248	(3,397)	(5,221)
	----------------------	----------------------	----------------------	----------------------
ECL allowance as of 30 September 2023	58,596	1,277,042	391,581	1,727,219
	==========	==========	==========	==========
	61,093	1,277,107	392,025	1,730,225
	==========	==========	==========	==========

26. Corporate tax

On December 9, 2022, the United Arab Emirates (UAE) Ministry of Finance (MoF) released Federal Decree Law No 47 of 2022 on the Taxation of Corporations and Businesses, Corporate Tax Law (CT Law) to enact a new CT regime in the UAE. The new CT regime has become effective for accounting periods beginning on or after June 1, 2023. As the Group's accounting year ends on December 31, the first tax period will be the period from January 1, 2024 to December 31, 2024, with the respective tax return to be filed on or before September 30, 2025.

The taxable income of the entities that are in scope for UAE CT purposes will be subject to the rate of 9% on taxable profits above AED 375,000. The tax charge for the nine-month period ended 30 September 2024 is AED 24.69 million (30 September 2023: nil). As per the Group's assessment, there is immaterial deferred tax impact on account of the CT Law in the Group condensed consolidated interim financial statements for the period ended 30 September 2024.

27. Seasonality of results

No income of a seasonal nature was recorded in the condensed consolidated interim statement of profit or loss for the nine-month period ended 30 September 2024.

28. Subsequent events

There are no material subsequent events have occurred that require adjustment to, or disclosure in, the interim financial statements.

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Bank of Sharjah P.J.S.C. Financial Information 30 September 2024

18/10/2024 9:37am

RNS Regulatory News

Bank of Sharjah P.J.S.C.

Condensed consolidated interim financial information

for the period ended 30 September 2024

Statutory

reserve

Contingency

reserve

Balance at 1 January 2023 (audited)

Balance at 30 September 2023 (unaudited)

Balance at 1 January 2024 (audited)

Adjustment on disposal of FVOCI investment

Transfer from retained earnings (note 10)

Balance at 30 September 2024 (unaudited)

Operating profit before changes in operating assets and liabilities

Changes in

Deposits and balances due from banks maturing after three months from dates

of placements

Statutory deposits with central banks

Net cash generated from/ (used in) operating activities

Purchase of financial assets

Proceeds from sale of assets acquired as settlement of debt

Proceeds from sale of property and equipment

Proceeds from disposal of investments

Proceeds from disposal of fixed assets

Net cash (used in)/ generated from investing activities

Net cash generated from/ (used in) financing activities

Net increase/ (decrease) in cash and cash equivalents

Cash and cash equivalents at the beginning of the period

Cash and cash equivalents at the end of the period (Note 8)

5 Financial instruments

5.1 Recognition and Initial Measurement

Financial assets measured at amortised cost

Financial assets measured at FVTPL

Financial assets measured at FVTOCI

On initial recognition, the Group can make an irrevocable election (on an instrument-by-instrument basis) to designate investments in equity instruments as at FVTOCI. Designation at FVTOCI is not permitted if the equity investment is held for trading. A financial asset is held for trading if:

· it has been acquired principally for the purpose of selling it in the near term;

· on initial recognition it is part of a portfolio of identified financial instruments that the Group manages together and has evidence of a recent actual pattern of short-term profit-taking; or

· it is a derivative that is not designated and effective as a hedging instrument or a financial guarantee.

1 Year Bos Fund 29 Chart

1 Month Bos Fund 29 Chart

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