ISLAMIBANK 2012 Annual PDF

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Annual Report 2012 1
REGISTERED OFFICE: Islami Bank Bangladesh Limited, 40, Dilkusha Commercial Area, Dhaka-1000, Bangladesh;
GPO Box No.233; Phone : PABX (88-02) 9563040, 9560099, 9567161, 9567162; Mobile : 88-01711-435638-9
FAX : 88-02-9564532, 9568634; SWIFT : IBBLBDDH, E-mail : info@islamibankbd.com; Web-site : www.islamibankbd.com
2 Annual Report 2012

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Contents
Standard Disclosure Index 6 Directors Report

Recognition par Excellence 10 Report of the Board of Directors 72
Looking Forward 12 Corporate Governance 79
CEO and CFO’s Declaration to the Board 98
Corporate Objectives Values Structure
Certificate Regarding Compliance of BSEC 106
Vision 13 Notification
Mission 14 Green Banking 107
Strategic Objectives 15 Performance Review 112
Core Values & Commitments 16 Case Study 134
Code of Conduct and Ethical Principles 17 Market Disclosure under Pillar III of Basel II 141
Risk Management 152
Corporate Profile 18
ICT and Automation 161
Milestones 20
Corporate Communication and Business 167
Sponsors 21 Promotion
Board of Directors and its Committees 22 Financial Review 174
Short Profile of Directors 23 CSR: Sustainability Report 177
Shari‘ah Supervisory Committee 31 Islami Bank Foundation 187
Management Committee 32
Audit Committee Report 193
Executives 33
Report of the Shari‘ah Supervisory 195
Corporate Structure 36 Committee
Products and Services 37 Financial Statements

Media Highlights 39 Auditors’ Report 197
Stakeholders’ Information 41 Consolidated Financial Statements
Consolidated Balance Sheet 199
Performance Analysis Consolidated Profit and Loss Account 201
Consolidated Cash Flow Statement 202
Graphical Representation 46
Consolidated Statement of Changes in Equity 203
Segment Information 48
Financial Statements of IBBL
Horizontal & Vertical Analysis 49 Balance Sheet 205
Profitability, Dividends, Performance & 50 Profit and Loss Account 207
Liquidity Ratios
Cash Flow Statement 208
Statement of Value Added and its 51 Statement of Changes in Equity 209
Distribution
Liquidity Statement 210
Financial Highlights 53
Notes to the Financial Statements 212
Five Years Performance at a Glance 54 Financial Statements of Offshore Banking Unit 272
Financial Statements of IBSL 279
Financial Calendar 56 Financial Statements of IBCML 297
Management Report and Commentary
Chairman’s Message 57 Branch Network 305
Notice of 30th Annual General Meeting 313
Managing Director’s Round up 63
Proxy Form & Attendance Slip 315
Management Report and Analysis 67

Standard Disclosure Index
Disclosure Checklist to the Key Sections of the Annual Report 2012
Items Ref. Page No.
Corporate Objectives, Values & Structure
Clarity and Presentation:
• Vision and Mission 13-14
• Overall strategic objectives 15
• Core values and code of conduct/ethical principles 16-17, 85
• Profile of the company 18-19, 75-78
• Director’s profiles and their representation on Board of other companies & organization chart 22-30, 231-232, 36
Management Report / Commentary and Analysis including Director’s Report / Chairman’s

Review/CEO’s Review etc.
• A general review of the performance of the company 112-133, 57-70,

161-166
• Description of the performance of the various activities/products/segments of the company

112-133, 161-166, 48
and its group companies during the period under review.
• A brief summary of the Business and other risks facing the organization and steps taken to 83-85, 152-160,
effectively manage such risks 225-228
• A general review of the future prospects/outlook 12, 70, 165-166
• Social responsibility initiatives (CSR) 60, 66, 70, 177-191
• Environment related initiatives 59, 66, 91, 107-111,

181-186
• Information on how the company contributed to its responsibilities towards the staff (including
86-90, 178, 222-223
health & safety)
• Information on company’s contribution to the national exchequer & to the economy 58-61, 176, 177-191
Appropriateness of Disclosure of Accounting Policies and General Disclosure
• Disclosure of adequate and properly worded accounting policies relevant to assets, liabilities,
212-232
income and expenditure in line with best reporting standards
• Any specific accounting policies 213-217
• Impairment of Assets 220
• Changes in accounting policies/changes in accounting estimates 215
Segment Information
• Comprehensive segment related information bifurcating segment revenue, segment results 48, 68-69,
and segment capital employed 235-239, 271
• Availability of information regarding different segments and units of the entity as well as non-
48, 145-146, 271
segmental entities/units

Items Ref. Page No.
Segment analysis of
• Segment revenue 48, 271
• Segment results 48, 271

• Turnover 271
• Operating profit 271
• Carrying amount of net segment assets 271
Financial Statements
• Disclosures of all contingencies and commitments 200, 206, 224
• Comprehensive related party disclosures 231-232
• Disclosures of remuneration & facilities provided to Directors & CEO 86, 201, 207, 264
• Statement of Financial Position/Balance Sheet and relevant schedules 199-200, 205-206
• Income Statement/Profit and Loss Account and relevant schedules 201, 207
• Statement of Changes in Equity/Reserves & Surplus Schedule 203-204, 209-210
• Disclosure of Types of Share Capital 42-43, 249-252
• Statement of Cash Flow 202, 208
• Consolidated Financial Statement (CFS) 199-204
• Extent of compliance with the core IAS/IFRS or equivalent National standards 228-230
• Disclosures/Contents of Notes to Accounts 212-277
Information about Corporate Governance
• Board of Directors, Chairman and CEO 18, 22, 79-80
• Audit Committee (composition, role, meetings, attendance, etc.) Internal Control & Risk 22, 81-85, 95,
Management. 193-194, 230
• Ethics and Compliance. 17, 85
• Remuneration and other Committees of Board 22, 79-80,86
• Human Capital 86-90
• Communication to Shareholders & Stakeholders 90-91
- Information available on website
44
- Other information
• Environmental and Social Obligations 91, 107-111, 177-191
• Management Review and Responsibility 93
• Disclosure by Board of Directors or Audit Committee on evaluation of quarterly reports 82
• Any other investor friendly information 41-44, 91
Stakeholders Information
• Distribution of shareholding (Number of shares as well as category wise, e.g. Promoter group,
42, 96, 250
FII etc.)
• Shares held by Directors/Executives and relatives of Directors/Executives 96-97
• Redressal of investors complaints 44-45
Graphical/Pictorial Data
• Earnings per Share 46
• Net Assets 46

Items Ref. Page No.
• Stock Performance 52
• Shareholders’ Funds 46
• Return on Shareholders Fund 50
Horizontal/Vertical Analysis including following
Operating Performance (Income Statement)
• Total Revenue
• Operating profit
• Profit before Tax
• Profit after Tax
• EPS 49
Statement of Financial Position (Balance Sheet)
• Shareholders Fund
• Property, Plant & Equipment
• Net Current Assets
• Long Term Liabilities/Current liabilities
Profitability/Dividends/Performance and Liquidity Ratios
• Gross Profit Ratio
• Earning before Profit, Depreciation and Tax
• Price earning ratio

46, 50
• Current Ratios
• Return of Capital Employed
• Debt Equity Ratio
Statement of Value Added and Its Distribution
• Government as Taxes
• Shareholders as dividend
• Employees as bonus/remuneration
51-52
• Retained by the entity
• Market share information of Company’s product/services
• Economic value added
Additional Disclosures
• Sustainability Development Reporting 177-191
• Human Resource Accounting 88-90
• Any other good additional disclosures (Independence certification e.g. GNV / GRI) 90, 93
Specific Areas for Banking Sector
Disclosure of Ratings given by various rating agencies for Instruments issued by/of Bank for e.g.
94, 228, 246
FD.CD. Tier-1 Perpetual Bonds
Details of advances portfolio classification wise as per the direction issued by the central bank of 114-129, 237-242,
the respective countries 253-255

Items Ref. Page No.
Disclosure for non-performing assets
• Movements in NPA
129, 147-148,
• Sector-wise breakup of NPA
240-243
• Movement of Provisions made against NPA
• Details of accounts restructured as per regulatory guidelines
Maturity pattern of key Assets and Liabilities (ALM) 211, 235-249
Classification and valuation of investments as per regulatory guidelines/Accounting Standards 235-242
Business Ratio/Information
• Statutory Liquidity Reserve (Ratio) 234
• Net interest income as a percentage of working funds/operating cost – Efficiency ratio 55
• Return on Average Asset 55
• Cost/Income Ratio 55
• Net Asset Value per Share 53, 55
• Profit per employee 89
• Capital Adequacy Ratio 54, 143, 251
• Operating profit as a percentage of working funds 53
• Cash Reserve Ratio/Liquid Asset ratio 50, 233-234
• Dividend Cover ratio 53
• Gross Non-Performing assets to gross advance / Non-Performing Investments (Assets) to

54, 155, 129
Total Investments (Assets)
Details of credit concentration / sector wise exposures 115-116, 145-147,

239-240
The break-up of ‘Provisions and contingencies’ included in the Profit and Loss Account 200-201, 206-207,
221, 247
Disclosure under regulatory guidelines 141-151, 95-106,

250-258
Details of Non Statutory investment portfolio 235-236
Disclosure in respect of assets given on operating & finance lease 115, 237-238
Disclosures for derivative investments N/A
Bank’s Network : List of Centers or Branches 305

Recognition par Excellence
As recognition of excellent performance, IBBL was rewarded with

the following prestigious rankings and awards in recent past:
The Banker Anniversary Award for Corporate Governance

Disclosures for the year 2011. SAFA awarded
 IBBL is the only Bangladeshi Bank that has
IBBL also with the 1st Runner up title under
entered into the World’s Top 1000 Banks List
Private Sector Banks (including Co-operative
2012. IBBL has made Bangladesh proud
Banks) in the best presented annual reports
of being among the best 1000 banks in the
for the year 2011. SAFA declared IBBL as the
world, ranked by ‘The Banker’, the UK’s
‘Joint Winner’ in the ‘Corporate Governance
premier financial magazine. This prestigious
Disclosure Award-2010’. SAFA also conferred
ranking is a clear testimony of IBBL’s stability
IBBL the ‘Certificate of Merit’ in ‘Banking
and strength, and its leadership in financial
Sector’ in the Best Presented Accounts &
sector of Bangladesh.
Reports Award for the year 2010.
IBBL has been ranked 17th in the performance
category (assessed by profits on capital), 70th Institute of Chartered Accountants of
in Return on Asset (ROA), 660th in Soundness Bangladesh (ICAB)
(assessed on Capital Assets Ratio), 868th in
Size (assessed on Assets) and 1000th in  The Institute of Chartered Accountants of
Tier-1 capital. The last criterion is widely Bangladesh (ICAB) conferred IBBL with the
accepted as the most important measure for 1st position under SAARC Anniversary Award
gauging the financial stability of a bank. for Corporate Governance for the year 2011.
ICAB also conferred IBBL the 3rd position
The Top 1000 rankings are compiled from a under banking category in the Best Presented
database of over 5000 banks worldwide and Annual Reports 2011 & 2010.
are widely recognized by the global financial
community as the definitive guide to bank Institute of Cost and Management
rankings and analysis.
Accountants of Bangladesh (ICMAB)
South Asian Federation of  The Institute of Cost and Management

Accountants (SAFA) Accountants of Bangladesh (ICMAB)
glorified IBBL with the ICMAB National Best
 South Asian Federation of Accountants (SAFA) Corporate Award-2011, 2010 (First Position
rewarded IBBL as Winner of the SAARC amongst the Private Commercial Banks in

Finance Minister Abul Maal Abudul Muhit, MP is handing over ICAB Award to the Managing Director of the Bank
Islamic Operation), ICMAB Best Corporate Other Recognitions

Performance Award–2008 (Second Position
amongst the Private Commercial Banks)  ICICI Bank, Hong Kong, conferred IBBL with
and the ICMAB National Best Corporate the “The Quality Recognition Award-2009” for
Award-2007 (First position among the Local U.S. Dollar Clearing (2009).
Banks).  Bankers’ Forum recognized IBBL as the Best
Bank for Corporate Social Responsibility for
Goldman Sachs 2008 and 2009.
 Goldman Sachs, the leading wealth  Exclusive economic weekly “The Industry”
management institution of the world, has conferred IBBL with the Best Rated Bank
chosen IBBL as proper place for investment. Award-2010, 2011 & 2012.
IBBL is seventh in the top ten companies
 The CitiBank, NA recognised IBBL as the
ranked by Goldman Sachs in its portfolio
“Largest Contributor” in Foreign Trade
‘GSN-11’.
Operations in Europe Bangladesh corridor in
2009.
Business Asia
 The UAE Exchange awarded IBBL for
 The “Business Asia” nominated IBBL as the
mobilizing around 30% of total foreign
‘Most Respected Company Awards 2012’ for
remittance of the country.
outstanding performance in Banking Sector.
Global Finance
 The Global Finance, a reputed USA-based
Financial Magazine, recognized IBBL as the
best Islamic Financial Institution of the country
for the years 2008, 2009, 2010 & 2011.

Looking Forward
• Fall in the margin ratio for investment accounts

A big slice of the Annual Report contains
management’s innovative thinking and views
based on IBBL’s business, economy, future
• Instability in capital market arising from
speculations
programs, circumstances and their implications.
However, these statements do not guarantee • Preface of compliance issues raised by the
against certain risks and uncertainties, which international forums which is likely to affect the
are difficult to predict. Therefore, actual future export growth
results and trends, forecaste in forward-looking
statements, may differ significantly for the • Escalation of international prices of essentials
following reasons: that results in volatility in For. Ex market
• Changes in national, economic and financial • Global embargo/unrest in Middle-east

conditions countries affecting flow of remittances and
trade
• Changes in policies and actions of the
Government or Regulatory Authorities • Increase in Competition within the financial
industry
• Changes in IBBL’s Policy framework
• Increase in inflationary pressure
• Changes in demand for IBBL‘s products.
• Under utilization & change of different risk
• Fluctuations in international prices, that management tools
influence the foreign exchange market
• Changes in accounting standards or practices
• Instability of profit rate
• Unforeseen natural and other disasters,
• Unpredictability of capital market adverse weather and other similar
contingencies
• Volatility in the money market
• Changes in technology and evolving banking
• Changes in CRR and SLR of the banks
of dependable industry standards
• Changes in investment rate
• Changing demographic developments
• Changes in corporate tax structure and VAT on including changing consumer spending, saving
banking service and borrowing habits
• Increase in provision requirement reducing • Risks related to legislation, regulation and

ROA and ROE taxation

Vision
O ur vision is to always strive to achieve superior financial

performance, be considered a leading Islami Bank by reputation
and performance:
• Our goal is to establish and maintain the modern banking

techniques, to ensure the soundness and development of the
financial system based on Islamic principles and to become
the strong and efficient organization with highly motivated
professionals, working for the benefit of people, based upon
accountability, transparency and integrity in order to ensure
stability of financial systems
• We will try to encourage savings in the form of direct investment
• We will also try to encourage investment particularly in projects,

which are more likely to lead to higher employment.

Mission
T o establish Islamic banking through the introduction of a welfare

oriented banking system and also ensure equity and justice
in all economic activities, achieve balanced growth and equitable
development through diversified investment operations particularly
in the priority sectors and less developed areas of the country.
To encourage the socio- economic development and financial

services to the low-income community particularly in the rural areas.

Strategic Objectives
The strategic objectives are to: • ensure lucrative career path, attractive
facilities and excellent working environment
• ensure customers’ satisfaction
• ensure zero tolerance on negligence in
• ensure welfare-oriented banking
compliance with both Shari‘ah and regulatory
• establish a set of managerial succession dodies
and adopt technological changes to ensure
• provide impeccable and progressively better
development of an Islamic Bank as a stable
customer services using latest technologies
financial institution
• train and develop human resources
• emerge as a healthier & stronger bank at the
continuously and provide adequate logistics
top of the banking sector and continue stable
to satisfy customers’ need
positions in ratings, based on the volume of
quality assets • be excellent in serving the cause of least
developed community and area
• ensure diversification of investment by sector,
size, economic purpose & geographical • motivate team members to take the ownership
location and expand need-based Retail and of every job
SME/Women entrepreneur financing
• achieve global standard
• invest in the thrust and priority sectors of the
• build and consolidate corporate culture
economy
• ensure Corporate Social Responsibilities
• strive hard to become a employer of choice
(CSR) through all activities
and nurturing & developing talent in a
performance-driven culture • promote use of solar energy and green
• pay more importance in human resources as banking culture and ecological balance
well as financial capital

Core Values
• Trust in Almighty Allah

• Strict observance of Islamic Shari‘ah
• Highest standard of honesty, integrity & morale
• Welfare banking
• Equity and justice
• Environmental consciousness
• Personalized service
• Adoption of changed technology
• Proper delegation, transparency & accountability
Commitments
IBBL reposes trust in and maintains commitment to:
• Shari‘ah
• the Regulators
• the Shareholders
• the Community
• the Customers
• the Employees
• other stakeholders
• Environment/ecology

Code of Conduct and Ethical Principles
Shari‘ah foundation of the ethics • Doing good to others

• Integrity • Adhering to truth and transparency in
• The principle of vicegerency of humanity on statements
earth
b. Rules of conduct towards shareholders,
• Sincerity
managers and fellow employees
• Piety
• Developing the work through innovative and
• Righteousness and making one’s work perfect creative ideas
• Allah-fearing conduct in everything • Respecting the working hours of the
• Accountability to Almighty Allah institution
• Getting acquainted with the directives
Principles of personal ethics
• Safeguarding the institution’s assets, facilities
• Trustworthiness and equipment
• Legitimacy • Refraining from parting to others if this
• Objectivity goes against the interests and rights of the
employer.
• Professional competence and diligence
• Faith-driven conduct
c. Rules of conduct towards those who deal with
• Professional conduct and technical standards the institution and related parties
• Being keen on meet us the needs of those
Rules of ethical conduct who deal with the institution
a. Self-motivated rules influencing job performance • Giving rights to those who are entitled to
• Allah-fearing state of mind them justly
• Adhering to the Shari‘ah and implementing • Preserving confidential information
its principles • Being careful about one’s conduct and work
• Implementing justice and fairplay in one’s
• Being quick to do good and articulating the
truth

Corporate Profile
Name of the Company : Islami Bank Bangladesh Limited
Legal Status : Public Limited Company
10589
Company Registration Number : C- Dated March 13, 1983
485
Number of Employees : 12,188
Number of Branches : 276
Number of Shareholders : 60,302
Number of MPB holders : 27,723
Tax Payer Identification Number (TIN) : 210-200-0887
VAT Registration Number : 9015000857
Chairman : Prof. Abu Nasser Muhammad Abduz Zaher
Managing Director : Mohammad Abdul Mannan
Company Secretary : Abu Reza Md. Yeahia
Chief Financial Officer : Mohammad Nesar Uddin, FCA, FCMA
Credit Rating Agency : Credit Rating Information and Services Ltd. (CRISL)
Auditors : 1) M/S. A. Qasem & Co.

Chartered Accountants
(A Cooperating firm of Pricewaterhouse Coopers)
Gulshan Pink City
Suite # 01-03, Level # 7, Plot # 15,
Road # 103, Block-CEN(C)
Gulshan Avenue, Dhaka-1212.
2) M/S. ACNABIN
(An independent member of BAKER TILLY INTERNATIONAL)

BDBL Bhaban (13th Floor)
12, Kawran Bazar C/A, Dhaka-1215.

Tax Consultant : M/S. K.M. Hasan & Co.
Hometown Appartment (8th & 9th Floor)
87, New Eskaton Road, Dhaka-1000.
Investors’ Enquiry
For Share : Share Department
63, Dilkusha Commercial Area, (5th Floor), Dhaka-1000.
PABX: 9551105, 9551062, 9550415; Ext-627,624,615
& PABX: 9563040; Ext-369. Phone & Fax: 9564595
E-mail: ibblshare@islamibankbd.com
For Mudaraba Perpetual Bond (MPB) : Bond Department

63, Dilkusha Commercial Area
(5th Floor), Dhaka-1000.
PABX: 9551105, 9551062, 9550415, Ext-626
Phone: 9554579, Phone & Fax: 9564595
For Islami Bank Securities Limited : Managing Director & CEO

(Subsidiary Company of IBBL) Yousuf Chamber (5th Floor)
20, Dilkusha Commercial Area, Dhaka-1000.
Phone: 7121040, Mobile: 01730736027
E-mail: ibbldp@islamibankbd.com
For Offshore Banking : Off Shore Banking Department

International Banking Wing
Head Office
PABX : 88-2-9563040, 9560099, Ext. 116, 241,167
Fax : 88-2-9554151, 9564532
e-mail : kutub@islamibankbd.com

mshahjahan@islamibankbd.com

Milestones
• Incorporation : 13.03.1983
• Certificate of Commencement of Business : 27.03.1983
• Inauguration of 1st Branch : 30.03.1983
• Formal Inauguration : 12.08.1983
• Formation of Shari‘ah Council : 01.05.1983
• Formation of Sadakah Tahbil as a CSR Wing : 04.07.1983
• Initial Public Offer (IPO)
Subscription Opened : 30.06.1985
Subscription Closed : 14.07.1985
• Listing in Dhaka Stock Exchange Limited : 02.07.1985
• Listing in Chittagong Stock Exchange Limited : 07.03.1996
• 1 Rights Share Issue
st

• 4 Rights Share Issue
th

• IBBL Head Office in its Own Tower : 10.03.2000
• Opening of 100th Branch : 12.06.1997
• Joining/Agreement with CDBL : 29.12.2004
• In-house Core Banking Software : 02.04.2005
• Issuance of Mudaraba Perpetual Bond (MPB) : 25.11.2007
• Commencement of Broker House : 01.01.2008
• Opening of 100th Own ATM Booth : 04.11.2011
• Opening of 300th Own ATM Booth : 31.12.2012
• Agreement with OMNIBUS having 1520 ATMs : 25.11.2011
• Formation of Subsidiary Companies
a. Islami Bank Securities Limited (IBSL) : 22.03.2010
b. Islami Bank Capital Management Limited (IBCML) : 01.04.2010
• 1st Position in Inward Remittance Since : 31.12.2007
• 100% Online Banking : 07.01.2011
• Exclusive Sponsor for Beautification of Dhaka City
on the Occasion of ICC Cricket World Cup 2011 : 17.02.2011
• Launching of Offshore Banking Unit : 04.01.2011
• Launching of iBanking : 16.12.2011
• Title Sponsorship of National School Football Islami Bank Tournament 2011 : 30.11.2011
• Agreement with Bangladesh Cricket Board (BCB) for becoming Franchisee
in Bangladesh Cricket League (BCL) : 18.10.2012
• Inauguration of mCash service : 27.12.2012
• Launching of Call Center : 27.12.2012
• Agreement with Grameen Shakti for installation of Bio-gas Plants : 30.12.2012
• Landmark of Tk. 400,000 million Deposit : 03.11.2012
• 7 million Deposit Account : 22.12.2012

Sponsors
Local Foreign
Mohammad Abdur Razzaque Laskar (Deceased) Islamic Development Bank, K.S.A.
Mofizur Rahman (Deceased)
Kuwait Finance House (K.S.C.), Safat, Kuwait
Barrister Tamizul Haque
Jordan Islamic Bank, Jordan
Mohammad Younus (Deceased)
Islamic Investment and Exchange Corporation,
Mohammad Shafiuddin Dewan (Deceased)
Doha, Qatar
Mohammad Bashiruddin
Bahrain Islamic Bank, Bahrain
Mohammad Hussain (Deceased)
Islamic Banking System International Holding
Nashiruddin Ahmed (Deceased) S.A., Luxembourg
Mohammad Mosharraf Hossain, MP Al-Rajhi Company for Currency Exchange and
Mohammad Malek Minar (Deceased) Commerce, Riyadh, K.S.A.
Zakiuddin Ahmed (Present name: Al-Rajhi Company for Industry & Trade)
M.A. Rasheed Chowdhury Sheikh Ahmed Salah Jamjoom, K.S.A.
Engr. Mustafa Anwar Sheikh Fouad Abdul Hameed Al-Khateeb
Prof. Mohammad Abdullah (Deceased), K.S.A.
Serajuddowla Dubai Islamic Bank, Dubai, U.A.E.
The Ibn Sina Trust The Public Institution for Social Security,
(Repr. by Shah Abdul Hannan) Safat, Kuwait
Bangladesh Islamic Centre Ministry of Awqaf & Islamic Affairs, Kuwait
(Repr. by A.K.M. Nazir Ahmed) (Present name: Kuwait Awqaf Public Foundation
Islamic Economics Research Bureau Kuwait)
(Repr. by Prof. Mohammad Sharif Hussain) Ministry of Justice, Department of Minors Affairs
Mohammad Nuruzzaman (Deceased) Kuwait
(Present name: The Public Authority for Minors Affairs
Abul Quasem
Kuwait)
A.K.Fazlul Haque (Deceased)
Engr. Muhammad Dawood Khan
Baitush Sharaf Foundation Ltd.
(Repr. by Late Moulana Mohammad Abdul Jabbar)

Board and Its Committees
Board of Directors
Chairman Depositor Directors
Prof. Abu Nasser Muhammad Abduz Zaher Md. Abdus Salam, FCA, FCS
Repr. of The Ibn Sina Trust Humayun Bokhteyar, ACPA, FCA
Vice Chairmen Independent Directors

Yousif Abdullah Al-Rajhi, K.S.A. Professor N R M Borhan Uddin, Ph.D.
Prof. Dr. A.K.M. Sadrul Islam
Engr. Mustafa Anwar
Barrister Mohammed Belayet Hossain
Repr. of the Public Institution for Social Security, Kuwait
Ex-Officio Director
Directors Mohammad Abdul Mannan
Engr. Md. Eskander Ali Khan Managing Director and CEO
Repr. of Al-Rajhi Co. for Industry & Trade, K.S.A.
Company Secretary
Mohammad Abdullah Al Jalahma Abu Reza Md. Yeahia
Repr. of Kuwait Awqaf Public Foundation, Kuwait Senior Vice President & Secretary
Mohamad Adnan Midani Executive Committee

Repr. of Islamic Development Bank, K.S.A.
Chairman
Md. Abul Hossain Engr. Md. Eskander Ali Khan
Repr. of Investment Corporation of Bangladesh
Members
Dr. Abdulhameed Fouad Al-Khateeb Dr. Abdulhameed Fouad Al-Khateeb
Repr. of Arabsas Travel & Tourist Agency, K.S.A. Humayun Bokhteyar, ACPA, FCA
Abdullah Abdul Aziz Al-Rajhi, K.S.A. Md. Abdus Salam, FCA, FCS
Md. Abul Hossain
Salahuddin Ahmed
Repr. of Kuwait Finance House, Kuwait Audit Committee
Hafizul Islam Mian Chairman
Repr. of Islamic Education Society Professor N R M Borhan Uddin, Ph.D
Md. Shahidul Islam Members

Md. Abdus Salam, FCA, FCS
Mohammed Nazrul Islam
Mohamad Adnan Midani
Mominul Islam Patwary Humayun Bokhteyar, ACPA, FCA

Short Profile of Directors
Prof. Abu Nasser Muhammad Abduz Zaher

Chairman
Prof. Abu Nasser Muhammad Abduz Zaher, Chairman, Islami Bank Bangladesh Ltd.
began his teaching profession in the early seventies and later served in the Royal
Embassy of Kingdom of Saudi Arabia in Dhaka, Bangladesh for a long 13 years as the
Secretary. He is now the Managing Director of Ibn Sina Pharmaceutical Industry Ltd.,
a prominent pharmaceutical company in Bangladesh.
Prof. Zaher is also the Chairman of Islamic Banks Consultative Forum (IBCF) and
Industrialists & Businessmen Welfare Foundation (IBWF). He is Vice Chairman of
Bangladesh Association of Banks (BAB). He is Advisor to Bangladesh Association of
Pharmaceutical Industries. He is an honored personality for his pioneering steps in
promoting Islamic Banking in Bangladesh.
Prof. Zaher was the Director of IBBL in different times and was Chairman of the
Executive Committee. He is a Founder Member of Fouad Al Khateeb Foundation,
Badshah Faisal Institute, Ibn Sina Trust Dhaka, Manarat International School &
College, Ibn Tymia College, Islamic Education Society, Bangladesh Islamic Centre
and Syndicate member of the Manarat International University of Bangladesh.
Prof. Zaher is playing a vital role in social welfare-related works. He is related with
founding and development of hundreds of educational institutions. He has patronized
to establish many renowned private hospitals and helped thousands of people for
treatment.
Prof. Zaher visited more than 50 countries of the world, including KSA, Kuwait,
UAE, Bahrain, Egypt, USA, Canada, UK, Switzerland, Austria, France, Germany,
Italy, Denmark, Greece, Mozambique, South Africa, Turkey, Pakistan, Nepal, India,
Myanmar, Thailand, South Korea, Japan, Malaysia, Singapore and participated in
many international seminars, symposia and conferences.

Yousif Abdullah Al-Rajhi
Vice Chairman
Yousif Abdullah Al-Rajhi is a Vice Chairman of the Board of Directors and a foreign
Director of the Bank. He completed his graduation in Business Administration
majoring in Economics & Political Science from King Saud University, K.S.A. in 1986.
Then he obtained M.A. degree in Development Administration from Western Michigan
University, USA in 1991. He also completed Internal Auditor Course, Change
Management & Leadership Course and Speed Reading and Development Round
Attendance Certificate Course.
He is General Manager-cum CEO of Al-Rajhi Company for Industry and Trade, KSA
having exposure of 27 years. He started his Banking career with Al-Rajhi Banking and
Investment Corporation, the most reputed Financial Institution in the Royal Kingdom
of Saudi Arabia.
Mr. Yousif has visited various eastern and western countries of the world and
participated in many international seminars, symposia and conferences.
Engr. Mustafa Anwar

Vice Chairman
Engr. Mustafa Anwar represents the Public Institution for Social Security, Kuwait as
Director in the Board of Islami Bank Bangladesh Ltd. He is a Founder Sponsor of
Islami Bank Bangladesh Limited. Currently he is a Vice Chairman Board of Directors
of the Bank. Mostafa Anwar is the Chairman & Managing Director of Birds Group, a
large business conglomerate in the RMG sector of Bangladesh; the group comprises
Birds Garments Ltd., Birds Garments Ltd. Unit-2, Birds RNR Fashions Ltd., Birds
Apparels Ltd., Birds A & Z Ltd., Birds Fadrex Ltd., Khalifa Apparels Ltd., Civil General
Construction Ltd., Luba Prokousulli, Mag’s Eco-Earth Ltd. He was also Chairman &
Advisor of several standing Committees of BGMEA.
He completed his graduation in Civil Engineering from Bangladesh University of

Engineering & Technology (BUET) in early nineteen sixties and began his career as
an engineer of Bangladesh Water Development Board (BWDB).
Engr. Mustafa Anwar is engaged in various social, educational and cultural

organizations such as Ex-President & Founder member of Moitri Samity (Socio-
Cultural organization); Editor, The Weekly Bikram; Trustee, Darul Ehsan University,
Dhaka and Chairman, Shikor International School, Dhaka.

Engr. Md. Eskander Ali Khan
Chairman, Executive Committee
Engr. Md. Eskander Ali Khan represents Al-Rajhi Company for Industry & Trade,
K.S.A. as Director of Islami Bank Bangladesh Ltd. He is Chairman of the Executive
Committee of the Bank. He is a well-known businessperson in Real Estate & Poultry
Hatchery and Tourism Sector in Bangladesh. He completed his graduation in Electrical
Engineering from Bangladesh University of Engineering and Technology (BUET) in
1969. He served for a long time as electrical engineer in UAE. He is the Chairman of
Islami Bank Securities Ltd.
Mohammed Abdullah Al Jalahma

Director
Mohammed Abdullah Al Jalahma represents Kuwait Awqaf Public Foundation as a

Director in the Board of Islami Bank Bangladesh Ltd. He was appointed director in April
06, 2009. He completed his graduation in Business Administration from the University
of Concordia, Montreal, Quebec in 1985. He has 28 years working experiences in
the field of Charitable Foundation, Zakat House, Investment Department, Business
Administration, Modern and Developed Techniques in Managing Waqf, Building Team
Work, Protocol and Formalities, Promoting Positive Skills of Subordinators, Legal
Dimension in Real Estate Sector and Managing & Evaluating Property. At present, he
is serving as Deputy Secretary General of Kuwait Awqaf Public Foundation, Kuwait.
He has practical experience in establishing the Zakat House in Cairo, the waqf
residential Complex “Kuwait and Bahrain” in the Kingdom of Bahrain, the waqf fund
for attending to the disabled, being the first waqf fund to be initiated by Kuwait Awqaf
Public Foudation and Kuwait Autistic Center as the first waqf project initiated by Kuwait
Awqaf Public Foundation.
He is also the member of Board of Directors of AI Dar Finance Company and Asian
Muslem Committee belonging to the World Charitable Foundation.
Mohamad Adnan Midani

Director
Mohamad Adnan Midani is a Chartered Accountant by profession. He completed his

Bachelor of Commerce from Lebanese American University, Beirut, Lebanon in 1988.
He obtained Graduate Diploma in Accountancy from the University of Concordia,
Montreal, Quebec in 1994. He obtained his Chartered Accountancy from the Canadian
Institution of Chartered Accounts.
He has more than twenty five years of diversified and valuable experiences in Auditing,
Accounting and Management consulting in diverse business entities and industries.
Mr. Midani is the Manager Investment Division, Equity Investment Deptt. of IDB Jeddah,
KSA. He has been representing Islamic Development Bank as Director of Islami Bank
Bangladesh Limited since May 19, 2010.

Md. Abul Hossain
Director
Md. Abul Hossain completed his Masters Degree in Statistics from Jahangirnagar
University in 1990. He is an Associate Member of Bangladesh Computer Society (AM-
1004). He has 20 years of working experience in the field of Govt. Service, Software
Development Company and Specialized Financial Institution. Presently he is General
Manager of Investment Corporation of Bangladesh. He represents Investment
Corporation of Bangladesh in the Board of Directors of IBBL as elected Director. He
also represents Investment Corporation of Bangladesh in the Board of Directors of
Aziz Pipes Limited as Chairman & NITOL Insurance Company Limited as well as Altex
Industries Ltd. as Director.
Dr. Abdulhameed Fouad Al-Khateeb

Director
Dr. Abdulhameed Fouad Al-Khateeb represents Arabsas Travel & Tourist Agency,
K.S.A. as Director of Islami Bank Bangladesh Ltd. He was appointed director on May
15, 2012. He is a Saudi National having Ph.D in Bio Medical Engineering and Asstt.
Professor of King Abdul Aziz University, Jeddah, KSA.
Abdullah Abdul Aziz Al-Rajhi

Director
Abdullah Abdul Aziz Al-Rajhi is an elected Foreign Director of the Board of Directors
of Islami Bank Bangladesh Ltd. He was appointed director on May 15, 2012. He is
holding 7.58% shares of the total Paid-up Capital of the Bank. He began his Banking
career with Al-Rajhi Banking and Investment Corporation, the most reputed Financial
Institution in the Royal Kingdom of Saudi Arabia.

Salahuddin Ahmed
Director
Salahuddin Ahmed represents Kuwait Finance House, Kuwait as a director of Islami

Bank Bangladesh Ltd. He was appointed as director on May 15, 2012. He is an
Indian National. He completed his Bachelor of Commerce Degree from University
of Lucknow, India in 1995. He obtained Post Graduate Diploma in Business
Administration (PGDBA) in 1998 and Diploma in Business Finance in 1996 from
Institute of Chartered Financial Analyst of India. He joined in Kuwait Finance House in
2007 and now a Senior Investment Manager. He has more than 13 years of working
experience in the field of Corporate Finance and Investments. He also represents
Kuwait Finance House, Kuwait as director of Kuwait Finance House Research Limited.
This is a premier research institution set up exclusively for promoting research in the
Islamic Banking Field, apart from other investment research.
Hafizul Islam Mian

Director
Mr. Hafizul Islam Mian is an elected Director of the Islami Bank Bangladesh Limited
(IBBL) representing Islamic Education Society. He got his Masters with Honours
Degree in Economics from the University of Dhaka in 1971. Later he obtained Masters
Degree in Financial Management from the Ulster University, Northern Ireland, U.K.
Earlier he got a Diploma Degree in Manpower Studies (Manpower Planning and
Training) from the Manchester University, U.K in 1987.
Mr. Islam retired as an Additional Secretary, Government of the People’s Republic of

Bangladesh in 2008. He spent a long time efficiently imparting different types of training
of the officers of all 29 cadres of the Government. Mr. Islam had to make extensive
tours to attend seminars, conference and meetings at different countries during his
services in the Government. He has now been assigned with the responsibilities of the
Chairman of a charitable social welfare organization named Islamic Aid Bangladesh.
He is the Executive Chairman of the Centre for Coastal Development and Research
in Bangladesh.

Md. Shahidul Islam
Director
Md. Shahidul Islam is an elected Director of Islami Bank Bangladesh Ltd. He is the
Managing Director of Green Park Housing Ltd., Dhaka. He is associated with a
number of social welfare organizations including Islami Bank Foundation. He spent
a long time in K.S.A. and got his education in Arabic Language from King Abdul
Aziz University, K.S.A. On his return home, he has embarked in business. He is a
Director of Bangladesh Publications Ltd. He is also a member of the Board of Trustee,
Bangladesh Islamic University (BIU). He was the Chairman of Audit Committee
of Islami Bank Bangladesh Limited. He is also the Vice Chairman of Islami Bank
Securities Ltd.
Md. Shahidul Islam has visited more than 30 countries of the world including India,
Pakistan, Thailand, South Korea, Japan, Malaysia, Indonesia, Singapore, KSA,
Kuwait, Qatar, Oman, UAE, Bahrain, Egypt, Turkey, UK, Austria, France, Germany,
Spain, Italy, Greece, Sweden, Belgium, USA, Canada, Uganda and participated in
many international seminars, symposia and conferences.
Mohammed Nazrul Islam

Director
Prof. Mohammed Nazrul Islam is an elected Director of the Board of Directors of

Islami Bank Bangladesh Ltd. He obtained M.Sc. in Applied Geophysics in 1979. He
served as a teaching Faculty in the Ministry of Education, Kingdom of Saudi Arabia in
different colleges from 1979 to 2003. He was a Member of the Executive Committee
of Islami Bank Bangladesh Limited. Now he is the Secretary of Islamic Aid Bangladesh
and a Director of Islami Bank Securities Limited (IBSL).
Mominul Islam Patwary

Director
Mominul Islam Patwary is an elected Director of Islami Bank Bangladesh Ltd. He

obtained Masters Degree in Chemistry from the University of Dhaka. He was the
founder-member of Executive Committee of Society for Pharmaceutical Chemists.
He held important positions in different Pharmaceutical Companies of the country.
He visited more than 22 countries of the world including USA, UK, France, Sweden,
Australia, Italy, Greece, Saudi Arabia, Kuwait, Oman, Qatar, Malaysia and participated
in many international seminars, symposia and conferences. He was Chairman of
the Executive Committee of Islami Bank Bangladesh Limited during December 12,
2003 to April 17, 2009 and May 18, 2011 to June 27, 2012. He is also a Director of
Bangladesh Publication Ltd.

Md. Abdus Salam, FCA, FCS
Depositor Director
Md. Abdus Salam, FCA, FCS is the elected Council Member for the term 2013-2015
and the President of the Institute of Chartered Accountants of Bangladesh for the year
2013. He was the elected Vice President of the Institute of Chartered Accountants of
Bangladesh for 2010-2012 and the former Vice President of the Institute of Chartered
Secretaries of Bangladesh. He is a Director of Ibn Sina Pharmaceuticals Industries
Ltd. (IPI) and the Chairman of the Audit Committee of IPI, a listed company with
Dhaka and Chittagong Stock Exchange Limited.
Mr. Salam has been representing ICAB in education, training & CPD (Continuing
Professional Development) Committee of South Asian Federation of Accountants
(SAFA). He is the Founder President of the Institute for Supply Chain Management,
Bangladesh- an affiliate of Institute for Supply Chain Management, USA. Mr. Salam
is a Director of Islami Bank Bangladesh Limited from the depositors’ category since
2010. Mr. Salam has been serving over last two decades as a consultant in various
Development Programmes financed by the World Bank, ADB, DFID, CIDA, etc. and
also worked for the Bangladesh Power Development Board, Ministry of Energy and
Mineral Resources, as the Director (Accounts) till 1990.
Humayun Bokhteyar, ACPA, FCA

Depositor Director
Humayun Bokhteyar obtained Accountancy Degree from Bangladesh and Australia.

He has long senior level financial management experience with services and
manufacturing sectors in Bangladesh and Australia. He is a Chartered Accountant
having exposure over 23 years. He is also an associate member of Australian
Society of Certified Practicing Accountants and Institute of Cost and Executive
Accountant (ACEA) UK. Mr. Bokhteyar is the founder and Managing Partner of
Public Accounting and Auditing Firm, M/s. Bokhteyar Humayun & Co., Chartered
Accountants. He was elected as Depositor Director of Islami Bank Bangladesh
Limited on September 01, 2010.
Professor N R M Borhan Uddin, Ph.D.

Independent Director & Chairman, Audit Committee
Professor NRM Borhan Uddin obtained Ph.D. in Management from Stevens Institute
of Technology, New Jersey, USA. He also completed his MBA & MS degree from the
USA. At present, he is the Vice Chancellor of City University. He is a Member of the
Board of Directors and Executive Committee of ICB Securities Trading Company
Limited and he was the Chairman of Green Land Pharmaceuticals Ltd., Tongi,
Gazipur. He has been the Independent Director of Islami Bank Bangladesh Limited
since July 24, 2010.

Professor Dr. A.K.M. Sadrul Islam
Independent Director
Prof. Dr. A.K.M. Sadrul Islam was nominated Independent Director of Islami Bank
Bangladesh Limited on December 29, 2012. Dr. Islam completed M.Sc. Engineering
from Bangladesh University of Engineering & Technology (BUET) in 1984 and
got his Ph.D. in Mechanical Engineering from Imperial College of Science &
Technology, University of London, U.K. in 1988. He was former Head and Professor
of Mechanical Engineering Department of BUET and presently a Professor of
Mechanical & Chemical Engineering Department and Head of Civil & Environmental
Engineering Department of Islamic University of Technology, a subsidiary organ of
OIC. He has also attained many Scholastic Award/Fellowships like Guest Professor
at Saga University, Japan, Visiting Professor, at University Technology of Malaysia,
INSPIRE Exploratory Grant, U.K., British Commonwealth Visiting Research Fellow
at Loughborough University, U.K.
Dr. Islam is currently the Chairman of Mechanical Engineering Division of Institution

of Engineers, Bangladesh (IEB) and the Secretary General of Bangladesh Society
of Mechanical Engineers (BSME). He is the Member of Board of Trustees of the
Ibn Sina Trust (IST) and Director of the Ibn Sina Pharmaceutical Industry Limited
(IPI). Prof. Islam visited various countries of the world such as India, Sri Lanka,
USA, UK, Canada, Malaysia, Japan, Sweden, Australia, China, Italy, Iran, Kuwait,
Belgium, Singapore, Brunei for participating international seminars, symposiums
and conferences.
Barrister Mohammed Belayet Hossain

Independent Director
Barrister Mohammed Belayet Hossain was nominated as Independent Director

of Islami Bank Bangladesh Limited on December 29, 2012. He completed Master
of Laws (LL.M.) from University of Chittagong. He obtained Barrister-at-Law from
the Honourable Society of Lincoln’s Inn, London. He is a member of the Executive
Committee of the Institute for Research and Development (IERF), Member and the
Coordinator of the Legal Aid Team (Supreme Court) and Bangladesh Islamic Law
Research & Legal Aid Centre, Dhaka. He acted twice as one of the Panel Judges of
the International Committee of the Red Cross (ICRC).
Barrister Hossain is a regular practitioner in the Hon’ble Supreme Court of Bangladesh.

He has been dealing successfully with the legal affairs of various national and
international commercial, maritime, academic and business entities. He regularly
takes part in seminars, talks and symposia as a Speaker/Lecturer/ Paper Presenter
on different national and global issues.

Shari‘ah Supervisory Committee
Sheikh Moulana Mohammad Qutubuddin Chairman
Chairman
Baitush Sharaf Anjuman-e-Ittehad Bangladesh
Mufti Sayed Ahmad Vice Chairman
Head Mufti
Al Jamiatus Siddikiah Darul Ulum
(Madrasah-e-Furfura Sharif), Darussalam, Dhaka
Professor Dr. Abu Bakr Rafique Member-Secretary
Pro-Vice Chancellor
International Islamic University Chittagong
Principal Mohammad Serajul Islam Member
Ex-Principal
Madrasha-e-Mesbahul Ulum, Dhaka
Abdur Raquib Member
Ex-Executive President
Islami Bank Bangladesh Limited
Mufti Shamsuddin (Zia) Member
Mufti & Muhaddis
Al Jameatul Islamiah, Potia, Chittagong
Moulana Abdus Shaheed Naseem Member
President
Bangladesh Quran Shikkha Society
Dr. Hasan Mohd. Moinuddin Member
Associate Professor
Deptt. of Islamic Studies
International Islamic University Chittagong, Dhaka Campus
Professor Dr. A. S. M. Toriqul Islam Member
Dept. of Dawah & Islamic Studies
Islamic University, Kushtia
Dr. Mohammad Abdus Samad Member
Associate Professor & Head of
Arabic Language & Literature Department
International Islamic University Chittagong, Dhaka Campus
Dr. Mohammad Monzur-e-Elahi Member
Asstt. Professor
National University
Moulana Mohiuddin Rabbani Member
Muhaddith
Foizul Ulum Madrasha, Dhaka
Khatib, Railway Jame Masjid, Fulbaria, Dhaka

Management Committee
Mohammad Abdul Mannan Chairman

Managing Director & CEO
Mohd. Shamsul Haque Member

Deputy Managing Director
Md. Habibur Rahman Member

Md. Nurul Islam Member

Muhammad Abul Bashar Member

Syed Abdullah Mohammad Saleh Member

Md. Habibur Rahman Bhuiyan, FCA

Member
A.K.M. Abdul Malek Chowdhury

Member
Md. Mahbub-ul-Alam
Member
Rafi Ahmed Begh

Executive Vice President
Member
Nurul Islam Khalifa

Executive Vice President Member
Abdus Sadeque Bhuiyan

Executive Vice President Member

Executives
Executives
Managing Director & CEO Mohammad Ali Muhammad Kamaluddin (Jasim)
Mohammad Abdul Mannan Muhammad Ghulam Sarwar Md. Qaisar Ali
Deputy Managing Directors Md. Ataur Rahman Salim Anwar
Md. Kawsar-ul-Alam Md. Abdus Salam
Mohd. Shamsul Haque
Abu Naser Mohammed Nazmul Bari Mizanur Rahman
Md. Habibur Rahman
Md. Mosharraf Hossain Md. Osman Gani
Md. Nurul Islam
Mohammad Nesar Uddin, FCA, FCMA Md. Mahboob Alam
Muhammad Abul Bashar
Senior Vice Presidents Abu Noman Md. Siddiqur Rahman
Syed Abdullah Mohammed Saleh
Sayed Nasir Uddin Md. Habibur Rahman
Md. Habibur Rahman Bhuiyan, FCA
Md. Shahidullah Md. Abdullah
A.K.M. Abdul Malek Chowdhury
Md. Mizanur Rahman Zafar Alam
Md. Mahbub-ul-Alam
A.H.M. Latif Uddin Chowdhury Mohammad Jamal Uddin
Executive Vice Presidents Mazumder
Md. Mostafizur Rahman Siddiquee
Abu Taher Mohammad Saleh Md. Aminur Rahman
Taher Ahmed
Md. Najibur Rahman Md. Shamsul Haque
Mohammad Jalal Uddin Akbar
Rafi Ahmed Begh Mohammad Sayeedullah
Faridul Hoque Chowdhury
Md. Nurul Islam Khalifa Muhammad Solaiman
Md. Giasuddin Ahmed
Abul Hossain Syed Sirajul Hoque
Md. Yeanur Rahman
Md. Nurul Islam Md. Abdus Sobhan
Md. Shahidur Rahman
Md. Azizur Rahman A.K.M. Shahidul Hoque Khandaker
Md. Omar Faruk Khan
A.K.M. Harunur Rashid Vice Presidents
Md. Motiar Rahman
Md. Mahfuzur Rahman
Md. Nizamul Hoque Sk. Md. Hassan
Md. Abdul Jalil
Kazi Kamrul Islam Md. Yeakub Ali
Abdus Sadeque Bhuiyan
Mohammod Ullah Abul Kalam Md. Saifullah
Md. Abdul Jabbar
Md. Tofazzal Hossain Khan Md. Abdul Matin
Md. Rafiqul Islam
Md. Saleh Iqbal Md. Ashraf Hussain
Md. Shafiqur Rahman
Abu Reza Mohd. Yeahia Abdullah Jahangir
Md. Kabir Hossain
Md. Shah Alam Sk. Moshiur Rahman
Md. Shamsuzzaman
Md. Nayer Azam Md. Sekander Ali
Md. Nazrul Islam Khan
Ahmed Ali Shahid Uddin Ahmed
Md. Shamsul Huda
Rana Mohammad Raihan Md. Saidur Rahman
Md. Obaidul Haque
Md. Moiz Uddin Md. Siddiquzzaman
Mohammed Monirul Moula
Md. Altaf Hossain Fayez Ahmed Chowdhury
Asheque Ahmad Jebal
Md. Faizul Kabir Md. Akhtar Hossain
Md. Abdur Rahman Banerjee
Md. Khalequzzaman Md. Abdul Matin
Mahmood Ahmed
Md. Abdul Quddus A.K.M. Nurul Islam
Md. Nurul Islam
Mohammad Rokan Uddin Md. Zalal Uddin
Md. Mohon Miah
Abu Sayeed Md. Idris Md. Manjurul Islam
A. A.M. Habibur Rahman
Md. Siddiqur Rahman Mohammad Jalaluddin
Shafiqul Mawla
K.M. Munirul Alam Al-Mamun Md. Sharif Uddin Pramanik
Mohammed Amirul Islam
A.K.M. Payer Ahammed Mir Rahmat Ullah
Shaikh Mohammad
as on 31.12.2012

Md. Mahbub-a-Alam Abdul Gafur Md. Qumrul Islam Shaikh Abdul Mannan
Jamal Uddin Md. Shahjahan Ali Md. Jashim Uddin
Rezaul Haque Mohd. Rafiqul Islam Md. Shamsuddoha Enajuddin Ahmed
Kazi Main Uddin Khadem Md. Shahid Ahmed Md. Zakir Hossain
Muhd. Quamrul Bari Imami Muhammad Hasnain Abid Khan Mosharraf Hossain
A.K.M. Kawsar Alam Md. Fakhrul Islam Md. Nurul Islam
Md. Farid Uddin Md. Abu Sufian Md. Anwar Hossain
Abul Faiz Muhammad Kamaluddin Md. Zamshidur Rahman Masudur Rahman Khalifa
Farid Ahmad Md. Zillur Rahman Patwary S.A.M. Mizanur Rahman Khan
Md. Akhter Hossain Major Md. Yunus Ali (Retd.) Abdul Momin
Abdus Sabur Khan Md. Maksudur Rahman Md. Mojibur Rahman
Md. Faiz Ahmed Md. Enamul Huq Md. Shafiuddin Talukder
Md. Mizanur Rahman Mizi Md. Shafiul Azam Md. Mizanur Rahman
Mohammed Shahid Ullah A.S.M. Rezaul Karim S.M. Rezaul Karim
Md. Shahidul Islam Md. Khalilur Rahman Md. Khaled Shaifullah
A.K.M. Abu Siddiqui Abdul Hamid Miah Muhammad Obaidullah
Abdul Gani Md. Ashraf Imam Md. Abdur Rahman
Md. Ashraf Ali Md. Shahidul Haq Akand Mohd. Yakub Ali
Md. Abdul Malek Md. Nazmul Hoda Shiraji Moshtaqe Ahmed
Sikdar Muhammad Shihabuddin Md. Gakir Hossain Md. Akhter Hossain
Ahmad Noor Md. Ziaullah Md. Nurul Hossain
Md. Ataur Rahman Nazmus Sakib Md. Rezaur Rahman Md. Habibur Rahman
Mohammed Sirajul Alam Md. Abdullah Rashed Md. Abul Kalam Azad
Rafiq-ul-Alam Md. Rezaul Islam Shaick Farid Ahmed
Md. Abdus Sabur Md. Mozahidul Islam Nisar Ahmed
Khorshed Ahamed Md. Fourkan Uddin Nizami Md. Nurul Amin
A.K.M. Shafiar Rahman Md. Jainal Abedin Md. Aminul Islam
Abdullah Anwar Md. Zillur Rahman Md. Murshed Alam
Md. Mustafizur Rahman Md. Manirul Islam Md. Shamsul Alam Siddique
Md. Ruhul Amin Md. Nasir Uddin Md. Bozlur Rahman
Md. Monzur Morshed Khan Shah Md. Mahtubuddin Al-Mamun Mohammad Hossain Khan
Mahmudur Rahman Md. Nasim Ahmed Md. Monir Hossain
Mohd. Ashraful Islam Abdul Kader Sarder Md. Sarwar Islam
Mohammad Masud Md. Saroar Hossain Md. Zillur Rahman
Muhammad Nurul Hoq Md. Abul Kalam Azad Ruhul Amin
Md. Anisul Haque Mohd. Enayet Ullah Siddiquee Md. Faruque Al-Mamun
Muhammad Golam Rabbani Md. Anowarul Haque Md. Ferose Uddin
Md. Mizanur Rahman Bhuiyan Md. Ibrahim Bhuiyan Muhammad Zillur Rahman Al-
Mohammad Akhter Hossen Kazi Mojibor Rahman Mahmud
Shahidullah Majumder Assistant Vice Presidents Md. Ashraful Alam
G.M. Mohd. Gias Uddin Quader Md. Abduzzaher Md. Alimur Rahman
Bashir Ahamed Syed Md. Amir Ali Md. Mustafa Kamal
Md. Rafiqul Islam Mohammad Yusuf Mohd. Shahid Uddin Akbar Bhuiyan
Chowdhury Shamim Hasnain Mahdi Md. Rafiqul Islam Muhammad Anisur Rahman
A.T.M. Shahidul Haque Md. Shamsul Alam Md. Zahirul Islam
Muhammad Zakir Hussain Md. Ibrahim Khalil Mohd. Shahjahan

Nesar Uddin Ahmad Md. Abu Sayed Md. Zakir Hossain
Md. Jamal Uddin Md. Afzal Hossain Md. Mahmud Hasan
A.F.M. Anisur Rahman Md. Masudul Alam Mohammad Esha
Abul Kasem Md. Mostafa Dilshad Parveen Md. Saiful Alam
Munshi Rezaur Rashid Md. Nurullah Bhuiyan Md. Saiful Islam
A.A.M. Mazharul Islam B.M. Habibur Rahman Md. Abdur Rashid
Md. Maznuzzaman Md. Harun-or-Rashid Mondal Kazi Shah Omar Faruk
A.K.M. Mahbub Morshed Mohammed Monzurul Islam
Md. Habibur Rahman Miah
G.M. Abdur Razzak Chowdhury
Md. Jashim Uddin
Md. Shahadat Hossain Md. Shamsul Alam
Mohammed Sanaullah Md. Zahurul Islam
Nazimuddin
Md. Jakaria Mohammad Musleh Uddin
A.K.M. Delowar Hossain
Md. Ashraf Uddin Md. Akram Hossain
Muhammad Shahidul Islam
Dilruba Hayat A.K.M. Sakawatullah
Md. Abul Khair
Md. Zahirul Islam Bhuiyan Md. Abul Fazal Khan
Md. Abdur Rob Mridha
Abdul Awal Khan Md. Habibur Rahman
Md. Saifur Rahman Chowdhury
S.M. Ali Mowla Fazle Bari Waseque Ahmad
Md. Habibur Rahman
Md. Matiur Rahman Md. Enayet Ullah Md. Amirul Islam
Ahmad Ali Md. Alauddin Gazi Md. Shah Alam
Sheikh Abdus Salam Md. Nazrul Islam Jomaddar Mohammad Nurul Hossain
Md. Hafizur Rahman Sheikh Mohammad Omar H.M. Wahiduzzaman Akon
Md. Anisur Rahman Md. Helal Uddin Dewan Md. Alamgir Khalil
M. Zubayer Azam Helali A.B. Muhammad Mostafa S.M. Mizanur Rahman
Md. Asaduzzaman M. Shamsuddin Ahmed Md. Abu Zafar
Md. Saiful Islam Md. Shah Alam Bhuiyan Md. Nuruzzaman Howlader
Mohd. Rafiqul Islam Md. Abu Walid Chowdhury
Mohammad Rezaul Karim
Md. Mahfuzul Karim S.M. Tanver Hassan
Muhd. Shaukat Ali
Abul Laise Muhd. Khaled Md. Mosharraf Hossain
Abdul Naser
Saiful Islam Md. Mahbub Al Hassan
S.M. Abdul Latif
Mohammad Mohi Uddin Mohd. Motahar Hossain
Mohammad Motaleb Sarder
Md. Golam Mostafa Sohel Aman
Md. Shah Jalal Sheikh
Md. Amzad Hossain Sheik Saidul Hasan
Md. Solaiman Ali
Ahmed Zubayerul Huq Md. Arifur Rahman
Syed Muhammad Moyeenuddin
Md. Zamal Uddin Sabina Yesmin
Md. Abduz Zaher
Mohd. Saiful Haque Md. Omar Faruque
Md. Ashrafuddin Sikder Md. Anwar Hossain
Md. Moksudur Rahman Munshi
Md. Monzurul Islam Md. Anwar Hossain
Abul Kalam Md. Shamsul Haque
Shahidul Alam Md. Abdul Matin Sk.
Mohd. Anwar Hossain
Md. Moniruzzaman Sarker Md. Mohiuddin
Meah Md. Barkat Ullah
Md. Dulal Hossain Muhammad Shahidul Alam
Mohammad Nurul Karim
Md. Jakir Hossain Md. Magfurur Rahman
Mohammed Kutub Uddin
Md. Monzoor-e-Elahi Miazee Md. Muzahidul Islam
Md. Abdul Jalil
Mahmud Hossain Khan Md. Abdur Razzaque Mohd. Nazim Uddin Talukder
Mohd. Mosharrof Hossain Md. Rezaul Karim Khaled Mahmud Raihan

Mahmuda Sultana Shah Md. Jubaer, ACA

Corporate Structure
ISLAMI BANK BANGLADESH LIMITED

Shari’ah Supervisory
Commiee
Review
BOARD OF DIRECTORS
Commiee
Chairman
Audit Commiee
Execuve Commiee
Islami Bank Islami Bank Capital

Islami Bank
Securies Limited Management
Limited Foundaon
MANAGING DIRECTOR
Shari’ah Board Secretariat

Secretariat Division
Management Asset Liability

Commiee (MC) Commiee
(ALCO)
Islami Bank Training Human Research &

& Research Resources Development
Academy Division Division
Internal
Operaons Corporate Retail Internaonal Development ICT Risk
Control &
Wing Investment Investment Banking Wing Compliance Wing Management
Wing Wing Wing Wing Wing
MD’s
Vigilance Squad Secretariat
Zones & Corporate

Branches

Products & Services
Local Currency Deposit Accounts Investment Products
1. Bill Financing (Mudaraba Documentary Bills
1. Al-Wadeah Current Account
2. Mudaraba Savings Account UPAS)
3. Mudaraba Term Deposit Account 2. Import Financing
4. Mudaraba Special Notice Account 3. Export Financing
5. Mudaraba Special Savings (Pension) Account 4. Short-term Murabaha
6. Mudaraba Hajj Savings Account 5. Project Finance (HPSM term investment)
7. Mudaraba Savings Bond Account
8. Mudaraba Waqf Cash Deposit Account Foreign Remittance Products
9. Mudaraba Monthly Profit Deposit Account 1. Remittance Card
10. Mudaraba Muhar Savings Deposit Account 2. Foreign Demand Draft
11. Students Mudaraba Savings Account
12. Mudaraba Farmers Saving Account Foreign Remittance Services
13. Mudaraba NRB Savings Bond (MNSB)
1. Central Crediting of Remittances
Deposit Products in Foreign Currency 2. Payment of 3rd Bank Remittance through
TT & PO
1. Mudaraba Foreign Currency Account (MFCA)
3. Payment of Spot Cash Remittances-
2. Mudaraba Exporters’ Retention Quota
Online and Web-based
Account (MERQ)
4. Centralised NRB Account Opening
3. Foreign Currency Account (FCA)
4. Foreign Currency Account (ERQ) 5. SMS Notification
5. Foreign Currency Account of EPZ Enterprise 6. SMS Push Pull Service
6. Resident Foreign Currency Deposit Account 7. Maintaining of NRD & NRT Accounts
(RFCD)
7. Non-Resident Foreign Currency Account of
Investment Products
Exchange Houses/Banks 1. Bai-Murabaha
2. Bai-Muajjal
Products in Off-shore Banking Unit (OBU) 3. Bai-Istijrar
Deposit products 4. Bai-Salam
1. Al-Wadeah Current Account 5. Bai-Istisna
2. Mudaraba Savings Account

6. Hire Purchase under Shirkatul Melk (HPSM) 6. Counseling
7. Mudaraba 7. Online Banking
8. Musharaka 8. SMS Banking
9. Musharaka Investment in Potato Storage 9. Internet Banking (i-banking)
10. Murabaha Post Import (MPI) 10. IBBL Web portal facility
11. Murabaha Import Bills (MIB) 11. Islami Bank mCash
12. Murabaha Import LC 12. Letter of Credit
13. Bai-Muajjal Back to Back Bills 13. Back-to-Back Letter of Credit
14. Bai-as-sarf (Foreign Documentary Bill: FDB) 14. Bank Guarantee
15. Bai-as-sarf (Foreign Currency Cheques/Drafts: 15. Foreign Bank Guarantee
FCD) 16. Murabaha Import Bill under UPAS
16. Murabaha Foreign Currency Investment 17. Export Bills Collection
(MFCI) 18. Substitute Cash Assistance
17. Musharaka Documentary Bill (MDB) 19. SWIFT
18. Bai-Salam (Pre-shipment) 20. Outward Remittance
19. Mudaraba NRB Entrepreneur Investment a. Travel purpose
Scheme (MNEIS) b. Study purpose (Student File)
c. Medical purpose
Welfare-oriented Special Investment d. Others
Schemes 21. Inward remittance
1. Household Durable Scheme (HDS) a. Encashment of cash Foreign Currency
2. Housing Investment Scheme (HIS) b. Collection of F.C. Cheques/Drafts
3. Real Estate Investment Program (REIP) c. Payment of Foreign TT & DD
4. Transport Investment Scheme (TIS) d. Others
5. Car Investment Scheme (CIS)
6. Investment Scheme for Doctors (ISD) Treasury Activities
7. Small Business Investment Scheme (SBIS) Dealing Room Operations:
8. Agriculture Implements Investment Scheme 1. Foreign Exchange Operations
(AIIS) 2. Money Market Operations
9. Rural Development Scheme (RDS)
10. Micro Enterprise Investment Scheme (MEIS) Special Services through Islami Bank
11. Urban Poor Develepment Scheme (UPDS) Foundation
12. Micro Industries Investment Scheme(MIIS) 1. Islami Bank Hospitals
13. Women Entrepreneurs Investment Scheme 2. Islami Bank Medical College, Rajshahi
14. Palli Griha Nirman Beniyog Prakalpa 3. Islami Bank Community Hospitals
15. NRB Entrepreneurs Investment 4. Islami Bank Nursing Training Institute;
Scheme(NEIS) 5. Islami Bank Institute of Health Technology
16. Solar Panel Investment Scheme(SPIS) 6. Islami Bank Homeopathic Clinics
7. Monorom: Islami Bank Crafts & Fashion
ATM Services 8. Islami Bank Service Centre
1. Cash Withdrawal 9. Islami Bank Institute of Technology
2. Fund Transfer 10. Islami Bank International School and College
3. Mini Statement of Accounts 11. Islami Bank Model School
4. Balance Enquiry 12. Islami Bank Mohila Madrasah
5. Payment of Utility Bills (Electricity, Water, 13. Bangladesh Cultural Centre
Phone and Gas etc.) 14. Distressed Women Rehabilitation Centre
Other Banking and Value Added Services Training Services

1. Payment Order (PO) 1. International : Officials of Foreign Banks on
2. Demand Draft (DD) Islamic Banking
3. Telegraphic Transfer (TT) 2. National : Training of own work force & others
4. Locker Service on Islamic Banking
5. Quard against TDR Diploma in Islami Bank

Media Highlights

Media Highlights

Stakeholders Information
S ustainability reporting affords the Bank a

means to communicate and engage with its
the Bank defines its key stakeholders as investors,
customers, employees, suppliers, communities and
stakeholders. Given the different nature of various environment. Through stakeholder inclusiveness
stakeholders, the Bank is compelled to strategically and strategic engagement, the Bank objectively
define its key stakeholder audience to ensure aims to achieve conclusive and positive outcomes
pragmatism in engagement and reporting. Thus for each of the identified stakeholders.
Stakeholders Inclusiveness and Engagement
Shareholders and Suppliers and Service Government and

Employees Customers Community
Investors Providers other regulators
• Permanent • Retail customers • Institutional • Correspondent • Central Bank • Children,
Staff • SMEs investors Banks and • Ministry of Women and
• Contract staff • Individual e-remittance agents Finance, Elders
• Micro customers
• Outsourced investors • Service providers National Board of • Graduates
• Remittance
staff • Resident & related to the Revenue, BSEC, and other
customers
non-resident Branch expansion DSE, CSE students in
• Probationers, • Cardholders
shareholders • Providers of • ICAB, ICMAB universities and
Trainees and
• ibanking customers maintenance, other training
Interns • MPB holders • Rating Agencies
• SMS banking security institutions
• Stockbrokers • Bankers
customers • Suppliers of fixed • Professionals
Association
• corporate entities assets and self-
• All Business employers
• External trade • Landlords of leased Chambers
customers premises • Different
• External Auditors communities
• Civil society
Stock Details
Sl. No. Particulars DSE CSE

1 Share Symbol ISLAMIBANK ISLAMIBANK
2 MPB Symbol IBBLPBOND IBBLPBOND
3 Company Code 11104 22008
4 Share Listing Date 02.07.1985 07.03.1996
5 MPB Listing Date 25.11.2007 25.11.2007
6 Market Category ‘A’ ‘A’
7 Electronic Share Yes Yes
8 Market Lot (Nos) 100 100
9 Face Value (Taka) 10 10
10 Total Number of Shareholders (31.12.2012) 60,302 60,302
11 IBBL Retained Position in DSE-20 CSE-30

Pattern of Shareholding
Sl. Particulars No. of shares Percentage (Taka) No. of shares Percentage (Taka)
No. as on (%) as on (%)
31.12.2012 to total 31.12.2011 to total
01 Sponsors / Directors 81,655,170 06.528 816,551,700 60,791,430 06.074 607,914,300

Local :
(Excluding Foreigners)
02 Foreigners
(a) Foreign Sponsors/ 662,358.172 52.948 6,623,581,720 359,624,340 35.935 3,596,243,400
Directors
(b) Excluding Foreign 126,865,760 10.141 1,268,657,600 227,604,180 22.743 2,276,041,800

Sponsors/Directors
Sub-total 789,223,932 63.089 7,892,239,320 587,228,520 58.678 5,872,285,200

03 Govt. of Bangladesh** 15,787 00.001 157,870 12,630 00.001 126,300
04 Institutions 101,474,744 08.112 1,014,747,440 99,847,687 09.977 998,476,870

(Excluding Foreigners)
05 General Public 278,594,367 22.270 2,785,943,670 252,890,933 25.270 2,528,909,330

Total 1,250,964,000 100.00 12,509,640,000 1,000,771,200 100.00 10,007,712,000
N.B.: Foreign: 789,223,932 63.09 - 587,228,520 58.68 -
Local: 461,740,068 36.91 - 413,542,680 41.32 -
** The shares have already been sold by the Government of Bangladesh but no transfer has yet been made in share register of the Bank.
Increase of Paid-up-Capital
(In million Taka)
Year Particulars Increase Total

1983 Initial Capital 0.50 0.50
1983 Sponsors 71.50 72.00
(a) Foreign = 56.00 Million
(b) Bangladeshi = 11.50 Million
(c) Govt.of Bangladesh = 4.00 Million
1985 I.P.O 8.00 80.00
1990 1st Rights/1989 (1R:1) 80.00 160.00
1996 2nd Rights/1996 (1R:1) 160.00 320.00
rd
2001 3 Rights/2000 (1R:1) 320.00 640.00
th
2003 4 Rights/2003 (2R:1) 1,280.00 1,920.00
2004 Bonus/2003 (1B:5) - Stock Dividend @20% 384.00 2,304.00
2009 Bonus/2008 (3B:10) - Stock Dividend @30% 1,425.60 6,177.60

Market Price Information
Month-wise share price status in the Stock Exchanges in 2012
DSE CSE
Month
Highest rate Lowest rate Average rate Highest rate Lowest rate Average rate
January 55.70 45.50 51.53 56.50 46.00 51.53
February 54.20 44.50 51.01 54.30 44.00 50.77
March 58.00 47.30 54.27 56.50 48.00 54.17
April 59.00 41.00 54.20 60.00 43.00 54.15
May 50.00 39.90 44.62 46.00 40.00 44.48
June 46.50 37.00 42.47 44.60 39.00 42.26
July 43.50 35.90 42.74 41.30 37.00 42.47
August 45.00 36.20 41.09 42.90 38.00 40.80
September 44.20 37.70 42.27 44.30 40.00 42.15
October 45.60 37.80 41.88 43.00 38.00 41.64
November 45.00 37.00 41.60 42.50 39.00 41.48
December 46.60 37.00 42.04 43.00 40.00 41.70
During 2012 59.00 35.90 47.45 60.00 37.00 48.50
Information on Share & Bond
1. Authorized Capital Tk.20,000,000,000/-
The Authorized Capital of the Bank is Tk.20,000,000,000/- divided into 2,000,000,000 ordinary shares of
Tk.10/- each.
2. Paid-up Capital Tk.12,509,640,000/-
The Paid–up Capital of the Bank is Tk.12,509,640,000/- divided into 1,250,964,000 ordinary shares of
Tk.10/- each fully subscribed by
(i) Local Shareholders : 36.91%
(ii) Foreign Shareholders : 63.09%
3. Mudaraba Perpetual Bond
On November 2007 the Bank issued Mudaraba Perpetual Bond for Tk.3,000,000,000/- through Private
Placement and Repeat Public Offer divided into 3,000,000 Bonds of Tk.1,000/- each.
4. The price quotation of MPBs of the Bank in the DSE and CSE for the Year 2012
Dhaka Stock Exchange Ltd. : Highest rate : Tk.1,050.00
Lowest rate : Tk. 890.00
Chittagong Stock Exchange Ltd. : Highest rate : Tk.1,068.00
Lowest rate : Tk. 847.00

Accessing Annual Report 2012 department any time for any sort of information
and query. To make the AGM more participatory,
Annual Report 2012 and other information about it is arranged in a well-known place &
IBBL may be viewed on Bank’s Website: www. convenient time to allow shareholders to speak
islamibankbd.com. IBBL transmits copies of in the AGM freely and value their proposals and
Annual Report to the Securities and Exchange suggestions. Any queries on shareholders such
Commission, Bangladesh Bank, Dhaka Stock as transfer of shares, changes of name and
Exchange and Chittagong Stock Exchange for addresses and payment of dividend may be
their reference. sent to the following address:
Queries on Corporate Information Share Department

Queries on any corporate information and 63, Dilkusha Commercial Area, (5th Floor),
published financial information may be directed to Dhaka-1000. PABX: 9551105, 9551062,
the Company Secretary of Islami Bank Bangladesh 9550415, Ext-627, 624, 615, & PABX: 9563040
Limited in the following address: Ext-369. Phone & Fax: 9564595
E-mail: ibblshare@islamibankbd.com
Company Secretary
40, Dilkusha Commercial Area, (6th Floor), Redressal of Investors’ Complaints
Dhaka-1000. PABX: 9551105, 9551062, 9550415, In the 29th Annual General Meeting, some
Ext-627,624,615, & PABX: 9563040 Ext-369. shareholders complained about different aspects
Phone & Fax: 9564595 of the bank financial, development and services.
Management of the bank has tried to mitigate
Shareholders’ Inquiries and various problems. They have taken cognizance
Communication of the suggestions of the shareholders in right
earnest. Some of the mitigations are given below:
Shareholders and others may contact to share
Investors Suggestions and Their Implementation Status
Sl. Complaints/Suggestions Redressal of the Investors’ Complaints

No.
1 Some Hon’ble Shareholders demanded increasing The number of own ATM Booths in rural areas have been
the number of ATM Booths with sophisticated increased. Total ATM Booths own & shared have been
machines in rural areas. increased from 1,135 to 1,820 during the year 2012.
2 One Shareholder thanked the Management for The word “Bismillahir Rahmanir Rahim” is to be written on the
displaying a lucrative & attractive banner of AGM, but top of the banner from next Annual General Meeting i.e. 30th
suggested to include in future “Bismillahir Rahmanir AGM.
Rahim” in the top of the banner.
3 Few Shareholders requested to arrange future AGM will be arranged subject to availability of suitable venue.
AGMs on Friday or Saturday, if possible.
4 They also requested the management of the Bank to The following steps have been taken:
take all out efforts to reduce the overdue, classified i. Formed a Central Task Force at Head Office with the
& written-off investment of the Bank to a minimum Managing Director in the chair.
level. Some shareholders suggested taking effective
steps for reducing provisions against non performing ii. Formed 13 Monitoring Committees at Head Office with
investment. the Top-Executives of Head Office to monitor zone-wise
recovery activities.
iii. Formed Task Force at Zonal Office and Branch level to
follow up the defaulter clients.
iv. Pursuing Court Cases from Head Office, Zonal Office and
Branch level for early settlement.
v. Pursuing the clients for early payment of Bank’s dues for
avoiding litigation through letters, reminders and personal
visit to the Business Establishments and Houses.

Sl. No. Complaints/Suggestions Redressal of the Investors’ Complaints
5 The Shareholders suggested rendering better The Chairman assured that the Branch Managers & 2nd Officers
customer service by the Branch officials. Some shall be punished if they fail to render better & quality service to
Shareholders suggested providing adequate logistic the customers/clients irrespective of their position and gender.
support, introducing modern technology & better Management has already increased workforce from 11,465 to
decoration, increasing the existing workforce at all 12,188 within 2012 with adequate logistic support as well as
branches for improvement of customer service. introducing modern technology & well decoration at all branches
for rendering better customer service by the branch officials.
6 Shareholders have suggested to extend more The Management has already taken initiatives to expand
investment facility for setting up ‘Solar System/ investment facility in the field of Boi-gas, ICS (Improved
Energy’. Cooking Stoves) and Solar.
7 The shareholders have requested to consider From January to December 2012 bank disbursed Tk.199,310.00
more investment facilities to the Small and Medium million which was only Tk.112,994.99 million in 2011.
Entrepreneurs. Present outstanding in SME is Tk.182,753.00 million which is
highest among all the 47 banks of the country.
8 The shareholders have requested to expand the To protect the people from the curse of interest and to alleviate
activities of RDS to protect the people from the curse poverty the Management has already expanded the activities
of interest and to alleviate poverty. of RDS program to 15,507 villages among 6,76,544 members
throughout the country within this year. The growth of which
was 21% over the year 2011.
Though some shareholders alleged for not receiving For ensuring proper receipt of Annual Report by the Hon’ble
9 the Annual Report in time, most of the shareholders Shareholders it will be distributed through the Branches of the
thanked for dispatching Annual Report through respective area. The Management will look into the performance
the Branch network and receipt the same by the of the courier service regarding delivery of the same to the
maximum shareholders. Shareholder.
10 Some Shareholders suggested deploying more The Management has already increased more investment
investment in the agriculture sector in the rural area. facilities to Agriculture Sector. The growth of which is 47%
& 44% in Rural Investment (Micro-Credit) and Agricultural
Investment respectively.
11 Shareholders suggested establishing more branches/ Out of 276 branches 52 are rural Branches. The growth of which
SME Centres in the rural area. One Shareholder is 12% more than previous year. IBBL has already launched
requested to open more branches at different places a new investment scheme namely “Urban Poor Development
in South-Eastern part of Bangladesh. Scheme (UPDS)”.
12 Shareholders urged to distribute scholarship & The Chairman assured that the Management would take
arrange a celebrating program for the wards of special attention to the vulnerable, poor & meritorious students
Shareholders, who secured GPA-5 in every year. for assisting them. The Management of the bank decided to
One of the Shareholders requested to distribute more increase scholarship to 400 students for 2 (two) years in H.S.C
scholarship among the poor & meritorious students. level and 400 students for 5 (five) years in Graduation level. The
rate of increase is 100% .
13 Shareholders suggested to send/publish Annual Annual Report is published through the website of IBBL (www.
Report through online/website. islamibankbd.com). Mentionable here that Annual Report of the
previous year has also been preserved in the mentioned web
address.
14 Shareholders suggested to develop the online Online services are available at all Branches of the Bank and
services of the Bank & reduce the online charges. online charges have already been revised. Cash Deposit/
Withdrawal including Transfer amount within the Divisional
City area is allowed to provide online banking facilities free of
charges up to the limit of Tk.1,00,000/- for two times in a day.
15 One of the shareholders suggested to be more For reducing/removal of doubtful income the following steps
cautious about doubtful income & to take effective has already been resorted:
steps to reduce/remove the same. i. Motivational program has been emphasized in every
branch of the bank.
ii. Sharia’h audit is conducted at least once in each branch
and twice in big branches in a year.
iii. Off-site supervision and Off-site motivation have been
arranged from Head Office.
iv. Motivation work has been arranged at the time of audit
work in every branch of the bank.
16 One Shareholder suggested strengthening the ‘Share Proper steps have been taken for strengthening the ‘Share
Department’ and ensuring proper housekeeping. Department’ and ensuring proper housekeeping

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Statement of Value Added and Its Distribution
Distribution of Value Addition 2012

T his shows how IBBL has generated the wealth
by providing banking services and how it was
distributed among the main stakeholders of the
Bank, taking into account the amount retained /ŶĐŽŵĞdĂǆ
WĂŝĚƚŽ
and re-invested for the replacement of assets 'ŽǀĞƌŶŵĞŶƚ

and improvement of operations. The comparative
value added statement of the Bank for the year ^ĂůĂƌǇΘ
ůůŽǁĂŶĐĞƐ
2012 and 2011 is given below:
ZĞƚĂŝŶĞĚWƌŽĮƚ
Value Added Statement ĂŬĂƚ

(In Million Taka) 'ĞŶĞƌĂůZĞƐĞƌǀĞ
ΘŝǀŝĚĞŶĚ

Particulars 2012 2011
ĞƉƌĞĐŝĂƟŽŶ
Income from Banking Service 50,346 38,401
Less: Cost of Services 28,014 20,386
Value added by Banking Service 22,332 18,015
Distribution of Value Addition 2011
Non-Banking Income - -
Provision for Investment & Off-
3,512 2,384
Balance Sheet exposures
Total Value Added 18,820 15,631 /ŶĐŽŵĞdĂǆWĂŝĚ
ƚŽ'ŽǀĞƌŶŵĞŶƚ
Distribution of Value Addition
^ĂůĂƌǇΘ

To government (income tax) 6,526 5,477 ůůŽǁĂŶĐĞƐ
To providers of capital (Cash
3,127 3,202 ZĞƚĂŝŶĞĚWƌŽĮƚ
dividerd & bonus share)
To employees (Salaries, allowance ĂŬĂƚ
5,957 4,652
and other benefits)
'ĞŶĞƌĂůZĞƐĞƌǀĞ
Zakat 325 263 ΘŝǀŝĚĞŶĚ
Expansion and growth ĞƉƌĞĐŝĂƟŽŶ
Retained by the entity 2,397 1,639
Depreciation 442 369
Deferred taxation 46 29 Income Tax
Total 18,820 15,631 (In million Taka)
ϳϬϬϬ
Economic Value Added Statement ϲ͕ϱϮϲ

ϲϬϬϬ
Economic Value Added (EVA) is a financial ϱ͕ϰϳϳ

ϱϬϬϬ
performance method to calculate the real economic
profit of the bank. It provides a measurement of ϰϬϬϬ
ϰ͕ϭϬϵ
a company’s economic success or failure over ϯ͕Ϯϰϱ
ϯ͕Ϯϱϯ
a period of time. Such a yardstick is useful to ϯϬϬϬ
investors who wish to place confidence with the
Bank to retain their fund for better earnings as ϮϬϬϬ
compared to other industry. ϮϬϬϴ ϮϬϬϵ ϮϬϭϬ ϮϬϭϭ ϮϬϭϮ

Comparative Economic Value Added Market Share Information
Statement for the Year 2012 and 2011
Market Share of IBBL in
(In million Taka) Sl. the Banking Sector (%)
Particulars
No.
2012 (%) 2011 (%)
1 Deposit 7.72 7.59
Shareholder’s equity 39,756 27,800
2 General Investment 8.40 8.16
Add: Accumulated provision for 11,091 8,170
Investment (including Off B/S) 3 Import 9.89 12.00
Total Invested Fund 50,846 35,970 4 Export 10.52 11.00
Average Shareholders’ equity 43,408 25,647 5 Remittance 27.70 26.07
Earnings
Profit after tax 5,524 4,841 Market Price at DSE: January to
Add: Provisions 3,512 2,384
December 2012
(In Taka)
Less: Written-off during the year (582) (427)
Earnings for the year 8,455 6,798 ,ŝŐŚĞƐƚƌĂƚĞ >ŽǁĞƐƚƌĂƚĞ
Cost of equity 7.87% 11.52% ϳϬ
Capital charges 3,415 2,954 ϲϬ
Economic Value Added 5,040 3,844 ϱϬ
ϰϬ
Market Value Added Statement ϯϬ
Market Value Added (MVA) statement indicates ϮϬ

the variation between the total market value and ϭϬ
the total value of shares of a bank. A gigantic
Ϭ
MVA means the bank has produced huge assets
:ĂŶ &Ğď DĂƌ Ɖƌ DĂǇ :ƵŶ :Ƶů ƵŐ ^ĞƉ KĐƚ EŽǀ ĞĐ
for the shareholders. MVA is equivalent to the
present value of all future expected economic
value addition. The share market value of IBBL Market Price at CSE: January to
stood at Tk.53,541.26 million whereas the book
December 2012
value of the share stood at Tk.39,755.64 million,
(In Taka)
resulting a Market Value Added of Tk.13,785.62
million as of December 31, 2012.
,ŝŐŚĞƐƚƌĂƚĞ >ŽǁĞƐƚƌĂƚĞ
Calculation of Market Value Added ϳϬ

ϲϬ
Value
Amount ϱϬ
Number of per
Particulars (Million
Shares Share ϰϬ
Taka)
(Tk.)
ϯϬ
Market Value 1,250,964,000 42.80 53,541.26
ϮϬ
Book Value 1,250,964,000 31.78 39,755.64
ϭϬ
Market Value 1,250,964,000 11.02 13,785.62 Ϭ
Added :ĂŶ &Ğď DĂƌ Ɖƌ DĂǇ :ƵŶ :Ƶů ƵŐ ^ĞƉ KĐƚ EŽǀ ĞĐ

Financial Highlights
(In million Taka)
Sl.
No.
1 Paid-up Capital 12,509.64 10,007.71
2 Total Capital (Equity) 42,028.30 33,716.73
3 Capital Surplus/ (deficit) 10,877.10 7,960.24
4 Total Assets (excluding contra) 482,536.32 389,192.12
5 Total Deposits 417,844.14 341,853.67
6 Total Investments (excluding Investment in Shares/ Securities) 372,920.72 305,840.56
7 Total Contingent Liabilities and Commitments 110,044.18 113,420.93
8 Investment Deposit Ratio (as per BB guidelines) 85.18% 87.29%
9 Percentage of Classified Investment against Total General Investments 3.81% 2.71%
10 Profit after Tax & Provision 5,524.44 4,841.45
11 Amount of Classified Investment during the year 5,920.48 3,636.69
12 Provision kept against Classified Investments 6,054.35 3,054.00
13 Provision Surplus/ (deficit) - -
14 Cost of Fund 9.32% 8.86%
15 Profit Earning Assets 389,011.85 295,962.73
16 Non-Profit Earning Assets 93,524.47 93,229.39
17 Return on Investments 12.21% 10.87%
18 Return on Assets 1.27% 1.35%
19 Income from Investments 44,104.20 32,308.90
20 Earnings per Share (Taka) (Restated 2011) 4.42 3.87
21 Net Income per Share (Taka) 4.42 3.87
22 Price Earning Ratio (Times) 9.68 11.27
23 Net Asset Value (NAV) 39,755.51 27,800.21
24 Net Asset Value (NAV) Per Share (Restated 2011) 31.78 22.22
25 Net Operating Cash Flow Per Share (NOCFPS) (Restated 2011) 16.32 13.11
26 Dividend Yield Per Share 5.84% 5.87%
27 Dividend Payout Ratio 56.61% 66.15%
28 Dividend Cover Ratio (Times) 1.77 1.51
29 Operating Profit as % working fund 4.86% 4.22%

Five Years Performance at a Glance
(In million Taka)
Sl.
Particulars 2008 2009 2010 2011 2012
No.
Balance Sheet Matrix
1 Authorized Capital 10,000.00 10,000.00 10,000.00 20,000.00 20,000.00
2 Paid up Capital 4,752.00 6,177.60 7,413.12 10,007.71 12,509.64
3 Share Premium 1.99 1.99 1.99 1.99 1.99
4 Reserve Fund 9,308.49 13,927.94 16,081.14 17,792.50 27,245.87
5 Retained Earnings 1,425.60 1,853.28 2,594.59 3,202.47 3,127.41
6 Shareholders Equity 14,060.49 20,105.54 23,494.26 27,800.21 39,755.51
7 Deposits (including Bills Payable) 202,115.45 244,292.14 291,934.60 341,853.67 417,844.14
8 Investments (including Investment in 187,586.55 225,752.41 275,493.94 322,772.83 399,930.79
Shares and Securities)
9 Investments (excluding Investment in 180,053.94 214,615.80 263,225.13 305,840.56 372,920.72
Shares and Securities)
10 Investment Deposit Ratio (as per BB 89.08% 87.85% 90.17% 87.29% 85.18%
guidelines)
11 Total Assets (including Contra) 288,017.19 340,638.49 443,684.79 502,613.05 592,580.50
12 Total Assets (excluding Contra) 230,879.14 278,302.84 330,586.12 389,192.12 482,536.32
13 Fixed Assets 4,407.22 6,512.36 6,748.44 7,100.19 14,808.23
Capital Matrix
14 Total Risk Weighted Assets (RWA) (Basel II for 173,289.43 202,756.60 256,804.90 257,564.30 311,511.60
2012, 2011, 2010 & 2009, Basel I for 2008)
15 Crore Capital- Tier- I 11,272.12 14,714.10 18,559.80 23,401.24 28,225.10
16 Suplementary Capital (Tier- II) 7,299.96 8,905.70 9,840.20 10,315.49 13,803.20
17 Regulatory Capital (Tier I, II & III) 18,572.08 23,619.80 28,400.00 33,716.73 42,028.30
Statutory Capital (Paid up Capital &
18 9,692.49 12,421.62 15,348.08 20,012.14 24,933.30
Statutory Reserve)
19 Equity/Capital Surplus/(Deficit) 1,243.14 3,344.16 5,287.58 7,960.24 10,877.10
20 Capital Adequacy Ratio (Basel II for 2012, 10.72% 11.65% 11.06% 13.09% 13.49%
2011, 2010 & 2009, Basel I for 2008)
Assets Quality
21 Amount of Classified Investment 4,311.13 5,063.40 4,655.63 8,292.32 14,212.80
22 Classified Investment to Total Investment 2.39% 2.36% 1.77% 2.71% 3.81%
23 Provision against Classified Investment 1,883.43 2,490.00 1,840.00 3,054.00 6,054.35
24 General Provision against Unclassified 2,315.74 2,700.00 3,443.00 3,996.00 3,935.90
Investment
25 General Provision on Off Balance Sheet 570.83 510.00 930.00 1,120.00 1,100.45
Items
Income & Expenditure Statement Matrix
26 Investment Income 19,543.84 21,370.53 24,766.26 32,019.53 43,672.23
27 Profit Paid on Deposit 12,162.10 13,076.99 14,471.89 18,401.22 25,870.43
28 Net Investment Income 7,381.74 8,293.54 10,294.37 13,618.31 17,801.80

Five Years Performance at a Glance
Sl.
Particulars 2008 2009 2010 2011 2012
No.
29 Non Investment Income 4,212.50 4,033.84 5,362.64 6,381.76 6,673.54
30 Total Income 23,756.33 25,404.37 30,128.90 38,401.29 50,345.77
31 Administrative & other Exp. 4115.81 4,545.97 6,087.32 7,268.45 8,867.10
32 Total Expenditure Excluding Provision 16,277.90 17,622.97 20,559.21 25,669.67 34,737.53
Provision for Investment, Off Balance Sheet
33 1,130.60 1,263.23 1,114.99 2,384.31 3,512.07
items & other Assets
34 Total Expenditure Including Provision 17,408.50 18,886.20 21,674.20 28,053.98 38,249.59
35 Net Profit before Tax 6,347.83 6,517.66 8,454.71 10,347.31 12,096.18
36 Net Profit after Tax 2,674.80 3,403.55 4,463.47 4,841.45 5,524.44
37 Provision for Income Tax 3,245.08 3,253.23 4,108.98 5,505.87 6,571.74
Foreign Exchange Business
38 Import Business 168,329.00 161,230.00 246,281.00 301,207.00 284,588
39 Export Business 93,962.00 106,424.00 148,421.00 178,244.00 197,095
40 Remittance 140,404.00 194,716.00 214,629.00 236,607.00 300,915
41 Total Foreign Exchange Business 402,695.00 462,370.00 609,331.00 716,058.00 782,598
Distribution Network
42 Number of Correspondent Banks 275 295 295 313 320
43 Number of Foreign Correspondents 906 919 919 935 676
44 Number of Shareholders 33,686 52,164 58,923 60,550 60,302
45 Number of Employees 9,397 9,588 10,349 11,465 12,188
46 Number of Branches *206 *231 *251 *266 *276
Shareholders’ Information
Cash … 10% … 7% 8%
47 Dividend
Stock 30% 20% 35% 25% 17%
48 Net Assets Value (NAV) per Share (taka) 22.76 27.12 23.48 22.22 31.78
49 Original (taka) 5.63 5.51 6.02 4.84 4.42

Earnings Per Share
Restated (taka) 2.14 2.72 3.57 3.87 4.42
50 Market Value per Share (highest-taka) 83.00 89.00 90.00 83.98 59.00
Financial Indicators
51 Gross Profit Ratio 46.80% 48.52% 51.97% 52.08% 48.61%
52 Cost of Fund 9.56% 8.76% 8.65% 8.86% 9.32%
53 Cost Income Ratio/Efficiency Ratio 0.73 0.74 0.72 0.73 0.76
54 Return on Equity (ROE) 19.02% 16.93% 19.00% 17.42% 13.90%
55 Return on Assets (ROA) 1.27% 1.34% 1.47% 1.35% 1.27%
56 Price Earnings Ratio (Times) 10.78 12.87 13.29 11.27 9.68
57 Spread 4.53% 4.86% 4.87% 4.03% 4.10%
* Including SME/Agriculture Branches

Financial Calendar 2012
Items Date
Final Dividend for 2011 paid May 30, 2012
Financial Statements for the year 2012 signed March 28, 2013
30th Annual General Meeting to be held May 22, 2013
Final Dividend for 2012 proposed to be paid June 20, 2013
Interim Financial Statements
For the 1st quarter ended March 31, 2012 (unaudited) approved by the Board of Directors May 14, 2012
For the 2nd quarter/Half Yearly ended June 30, 2012 (unaudited) approved by the Board of Directors July 12, 2012
For the 3rd quarter ended September 30, 2012 (unaudited) approved by the Board of Directors October 29, 2012
For the 4th quarter/Year ended December 31, 2012 (audited) approved by the Board of Directors March 28, 2013
Financial Calendar 2013 (Proposed)

Items Date
Financial Statements for the year 2013 will be finalized and signed February 27, 2014
31st Annual General Meeting will be held March 29, 2014
Final Dividend for 2013 proposed to be paid April 28, 2014
Interim Financial Statements
For the 1st quarter ended March 31, 2013 (unaudited) approved by the Board of Directors May 09, 2013
For the 2nd quarter/Half Yearly ended June 30, 2013 (unaudited) approved by the Board of Directors July 24, 2013
rd
For the 3 quarter ended September 30, 2013 (unaudited) approved by the Board of Directors October 23, 2013
For the 4th quarter/Year ended December 31,2013 (audited) approved by the Board of Directors February 27, 2014

Chairman’s Message
Bismillahir Rahmanir Rahim
Dear Shareholders, provisioning system introduced by our Central

Bank. Our Bank achieved unique strength with
Assalamu Alaikum Wa Rahmatullah.
high level of trust and confidence among the
It gives me immense pleasure to present to you depositors and investment clients besides people
the Annual Report of Islami Bank Bangladesh from all walks of the nation. We are proud to be
Ltd. (IBBL) along with the Audited Financial the partner of our clients across every change
Statements for the year 2012. Alhamdullilah, in of their lives, while we have continued to serve
2012, IBBL made expected result in its overall them better. With their overwhelming confidence
business activities, and like previous years, and support, total deposit of the Bank increased
continued to play an important role in augmenting to Tk.417,844 million (US $ 5,233 million) in
the national economy. In the year under review, 2012, marking a growth of 22% or Tk.75,990
the Bank has reached new heights in terms of million (US $ 952 million) over 2011. Total general
financial performance and contributed to the investment of the Bank increased to Tk.372,921
optimum welfare of the masses to become ÔgvwU I million (US $ 4,670 million) in 2012, marking a
gvby‡li e¨vsKÕ (a bank of Land & People). growth of 22% or Tk.67,080 million (US $ 840
million) over 2011. IBBL’s volume of investment
Notable Financial Performance and deposit is the second highest among the 47
scheduled commercial banks of Bangladesh. Total
We have passed the bygone year with significant number of deposit accounts at year end 2012
success despite prevailing local & global stood over 7 million wherein 1.9 million deposit
economic scenario and a major policy change accounts were newly added during the year which
in investment rescheduling, classification &

signifies the people’s high confidence on IBBL. Investment Services
Total number of investment clients at the year
IBBL always maintained Investment-Deposit
end stood over 0.7 million wherein 0.11 million
Ratio (IDR) at required level throughout the year
new investment clients were inducted during the
and devised a strategy to diversify the investment
year. Operating profit (Profit before provision) of
during the year across all business activities.
the Bank during 2012 stood at Tk.15,608 million
As a result, the Bank maintained comfortable
(US $ 195 million), demonstrating a growth rate liquidity and was also a provider of funds in
of 23% over the year 2011. This operating profit the interbank market under various Shari‘ah-
ranked top in the banking industry of Bangladesh. compliant transaction structures. The Bank’s
It is worth mentioning that all these enduring achievement of general investment against target
sustainability of our Bank have emanated from a was 106% and achievement of income from
responsible business approach that has created investment against target was 111% in 2012. In
long term stakeholder value through Shari‘ah the year 2012, the Management of our Bank has
compliance, continuous process improvement, given emphasis on a new product of investment,
innovation & adoption of technology, stakeholder i.e. Usance Payment at Sight (UPAS) through
engagement and ethical, social, environmental & Offshore Banking Unit (OBU).
good governance practices.
Industrialization
Foreign Remittance & Foreign IBBL feels it obligatory to increase the contribution
Exchange Business Performance of industrial sector to the GDP substantially as
industrialization is the lifeblood of our economy.
Inspite of narrowing down the scope of taking This feeling was translated into the Bank’s
further Bangladeshi workers in some potential unflinching services to the growth of industries
countries, IBBL’s remittance grew at 27% in especially the import substitute and export-
2012. Our Bank’s total remittance has increased oriented ones. We have financed many garments,
by Tk.64,308 million (US $ 805 million) during spinning and textile, steel, edible oil refinery and
2012 over 2011 to reach Tk.300,915 million (US cable industries exclusively. The Bank invested
$ 3,769 million). IBBL’s market share in foreign around 51% of its investment portfolio in industrial
remittance was 27.70% in 2012. This was sector whereas the contribution of industrial sector
possible due to the confidence reposed on us in GDP of the country was around 31% in the
by our beloved expatriates whose satisfaction is year 2011-12. Industrial investment of our Bank
increased by 25% in 2012 over 2011. IBBL ranked
one of our prime responsibilities as we were very
top in the industrial finance in the country.
attentive and prompt to send their hard-earned
money through banking channel to their family
Rural and Agricultural Financing
members in the easiest and caring manner within
the shortest possible time. IBBL handled export As an organization enjoying the position
business of Tk.197,095 million (US $ 2,468 of business leadership, our commitment to
million) during the year 2012, marking a growth sustainable banking remains strong as ever. With
of 11% or Tk.18,851 million (US $ 236 million) this end in view, we want to narrow down the
over the figures of 2011. The export volume of economic gap between urban and rural areas. We
our Bank in the bygone year was 10.52% of have significantly expanded our branch network to
total export of Bangladesh. On the other hand, rural areas. 19% of our branches are located in the
rural areas and we have plans to open more SME/
our Bank handled import business of Tk.284,588
Agriculture Branches to support our agriculture
million (US $ 3,564 million) during the year 2012
and the rural economy. Rural and agricultural
which is 9.89% of total import of the country. Total
investment of IBBL is gradually increasing over
Foreign Exchange Business of our Bank stood at
the recent years and it has become 7% of total
Tk.782,598 million (US $ 9,801 million) in 2012
investment demonstrating growth of Tk.5,359
with growth rate of 9.29% over 2011. million (US $ 67 million) over the last year.

RDS & UPDS Program for the NRBs, NRB help desk at all the branches
& at Head Office, Remittance Card to ease the
In 2012, our focus was essentially to further
withdrawal of money sent by the NRBs, NRB
penetrate the least developed economic sector,
Entrepreneurs Investment Scheme, etc. Total 28
and as such, we followed a concerted strategy
officials were deputed in 5 potential countries to
of network amplification with a view not only to
help the NRBs to remit their hard-earned foreign
engraving our footprint across the country but also
currency in Bangladesh through banking channel.
to bringing the concept of Islamic banking to the
very doorsteps of every rural community and urban
Employment Creation
poor. Our initiatives towards covering individuals
even at the grass root level of the socio-economic Millions of people were employed directly and
group have opened vistas of opportunities to indirectly through IBBL financed industries, SMEs
communities who have for generations lived below and Rural projects over the years. Our Bank has
the poverty line. We have expanded our business employed 12,188 employees along with newly
in micro finance under Rural Development employed 1,152 people during the year 2012.
Scheme (RDS) which is now operating in around We are steadfast with our programs to create
15,507 villages of 61 districts out of 64 districts employment opportunity to alleviate poverty from
of the country and Urban Poor Development the country by extending support to all, especially
Scheme (UPDS) through 260 centers at Dhaka the young generation, by creating jobs and
and Chittagong Metropolis having more than 0.73 opportunities for self-confidence, self-employment
million members under the two schemes. We are and self-reliance. Our Bank exerted its best efforts
empowering the underprivileged and developing to alleviate poverty from the country by making the
them into productive resources for the nation. people self-reliant.
Customer Service Ecology and Green Banking

IBBL has built in-house core banking software IBBL is a bank for all sections of people that deals
to expedite the customer service. We have with ethics, environment cognizance, economic
introduced all the modern services including ATM, justice and green banking. In response to the
SMS Banking and iBanking which are growing UNEP’s charter, IBBL insists on going green
day by day. We have the largest online network in to conserve the environment and to keep 3-Ps
the country. Alhamdulillah, we have successfully namely People, Planet and Profit for sustainable
launched ‘M-cash’, the mobile financial services development. IBBL also puts highest commitment
with the slogan Ônv‡Z nv‡Z mv‡_ mv‡_Õ (Hand to Hand all and emphasis on complying with Bangladesh
the times). People of all walks of life, including the Bank’s Green Banking policy guidelines by means
unbanked people, will get the benefit of banking of investing in eco-friendly projects and observing
services throughout the country round the clock
all the required Green Banking policies including
with ease and security. We will introduce all
4-R Principles namely Reduce, Reuse, Replace
forthcoming technologies to facilitate and ensure
and Recycle on day-to-day housekeeping process
best customer service.
in the office. IBBL has started (i) educating the
employees in Green Banking and encouraging
Special Care for NRBs
them to ingrain the practice in their daily activities
IBBL considers the NRBs as the partner in nation- with the initiatives for creation of a paperless
building and values them accordingly. The Bank office, (ii) taking care to protect environmental
introduced web-based very quick remittance pollution by Bank’s sanctioned projects, and (iii) a
facilities and spot cash system to enable the plantation program of “one man one plant” among
beneficies of NRBs to withdraw cash without its staff and the customers by observing ‘plantation
having any Bank Account with us. NRBs can check week’. IBBL has been recognized as one of the
their bank account from abroad through internet. top 10 green banks by Bangladesh Bank.
We also introduced Mudaraba NRB Savings Bond

Shari‘ah Compliance Goldman Sachs, the leading wealth management
institution of the world, chose IBBL as ‘the best
Strict adherence to Shari‘ah principles is the core
place for investment’. IBBL has also become a
value of our business. IBBL kept the position of
reference Bank to IDB which is a Bank of all Muslim
Shari‘ah Supervisory Authority above all bodies. countries under OIC. Our Bank provides technical
We took different steps in managing our deposit assistance and facilitates for establishing Islamic
& investment portfolio for achieving Maqaside banking at home and abroad. So far we extended
Al-Shari‘ah. IBBL does not extend investment technical support and trained manpower in
facilities which goes against the interest of establishing Jaiz Bank in Nigeria. On being trained
the nation and human. During the year 2012, from IBBL, Ceylon Bank of Sri Lanka has started
percentage of doubtful income decreased to 2.04% Islamic Banking and is operating successfully. We
only reflecting high level of Shariah Compliance. have also trained high-level officials of Uganda on
Shariah compliant banking system contributes the Islamic Micro-Finance Operations.
best for sustainability of the industry. Throughout
the year, IBBL has emphasized to create Corporate Culture & Recognition
awareness for total Shariah compliance among
the entire workforce and the clients that has Since inception, IBBL has been practicing corporate
helped in achieving such notable results. culture at all levels. IBBL has always been trying
to run the Bank professionally and showed its
Regulatory Compliance competence during last 29 years of operation. The
workforce of IBBL starting from CEO down to a
IBBL sincerely abide by 100% rules and regulations Messenger are very much involved and committed
issued by all the regulatory authorities. Our Bank’s professionals and thus could develop the Bank as
governance practices and management systems one of the highly complied one. We work under the
are designed to assist in conducting business guidelines of Bangladesh Bank, other Regulatory
transparently and with adequate delegation & Authorities and policies framed by the Board of
accountability, particularly with regard to Shariah, Directors without any interference from any corner.
Regulatory compliance, economic justice, IBBL is the proud recipient of the ‘SAFA (South
environmental and social aspects. We protect Asian Federation of Accountants) Corporate
the interest of Bangladesh, and compliant with Governance Award for 2010 & 2011’, ‘SAFA
its people, its law and general discipline. IBBL Award for Best Presented Reports-2011’, ICAB’s
has been recognized by and rewarded for its (Institute of Chartered Accountants of Bangladesh)
contribution, transparency and compliance culture ‘SAARC Anniversary Award for Corporate
both locally and internationally. Governance-2011’ & ‘ICAB Best Presented Annual
Report-2011’, and ICMAB’s (Institute of Cost and
International Recognition of IBBL Management Accountants of Bangladesh) ‘ICMAB
Best Corporate Award for 2011 & 2012’, which are
IBBL is working hard for becoming a world class
the obvious recognitions of the Bank’s sustained
bank. Our Bank has been included in the Top 1000
success in every aspects of its operations.
banks of the world in the July-2012 issue of the
century-old reputed UK-based fortnightly financial
CSR Activities
magazine ‘The Banker’ in terms of Tier-1 capital. In
this report, IBBL has been placed in the 17th position Equitable and inclusive development is a challenge
in terms of profit on capital, 70th position in terms that drives our Bank’s social agenda. As a pioneer
of Return on Assets (ROA) and 868th position in of welfare oriented Banking System, IBBL
terms of Assets size. This recognition, first of its acknowledges its indebtedness to the society.
kind given to a Bangladeshi financial institution, Our contribution in discharging Corporate Social
is indicative to the inclusion and acceptance of Responsibilities is the highest among all the banks
Bangladesh’s banking as per world standard. Apart of Bangladesh. IBBL assisted affected people in
from it, the “Business Asia” nominated IBBL as the natural calamities like Ayila and SIDR. We are also
“Most Respected Company Awards-2012” and the giving scholarship to thousands of students for their

study who cannot afford education expenses at Our Success
their own. It is the Bank’s conscious responsibility
towards the communities within and around which Above 20% of total liquidity and business of the
it operates to provide adequate social benefits, banking industry is in the hand of Islamic banking
particularly for those who are marginalized or outlets. Following the phenomenal success history
underprivileged. IBBL has taken several initiatives of IBBL, 6 other full-fledged Islamic banks and 18
at the individual and organizational level for conventional banks including state owned Sonali
improving the lives of less fortunate segments of Bank Ltd. & Agrani Bank Ltd. have started Islamic
the community. CSR expenditure of IBBL stood Banking Branches/operations in Bangladesh. It is
at Tk.309 million (US $ 4 million) in 2012. The also very much encouraging that a good number
Bank’s strategy towards discharging community
of private banks are trying to be converted into
responsibility focuses on (i) education, (ii) health,
Islamic ones. Banking activities of Bangladesh
(iii) humanitarian and disaster relief, (iv) sports,
have already been recognized as ‘at par’ with
arts & culture, and (v) women empowerment. The
large number of social welfare activities of the world standard which is evidenced from the IBBL’s
Bank as stated in the report reflects our sense of inclusion in the Top 1000 banks of the world by
responsibility to the society at large. the reputed financial magazine ‘The Banker’.
Moreover, following the pioneering role of IBBL in
Contribution to National Exchequer CSR activities, other banks & financial institutions
have engaged themselves in CSR activities and
Being a responsible corporate entity, the Bank
Bangladesh Bank is encouraging the same. These
regularly pays corporate tax on time. IBBL is the
all are the success of Islamic banking and IBBL.
highest Corporate Taxpayer among the Local
Banks and is the second highest Taxpayer in the
Banking sector of Bangladesh. During the year Brand Image
2012, it has contributed/paid total Tk.8,106 million IBBL’s comfortable capital adequacy, good assets
(US$ 102 million) as Corporate Tax, deducted tax
quality, good financial performance, comfortable
from different sources (i.e. profit paid on Deposits,
liquidity, strong market position, considerable
salaries of the employees, payment to suppliers,
improvement in non-funded business, experienced
vendors & customers etc.), Excise Duty and VAT.
top management, wide operational network &
Bank’s financed business/industry houses are
also generating huge employment opportunity strong corporate governance have given it an
& paying a substantial amount of taxes to the excellent “Brand Image”.
national exchequer regularly.
Our Strength
Our Role in Islamic Money Market
Our topmost strength is our total trust in Allah’s
IBBL played active role in development of Islamic help. Unity of thoughts and actions, goals of policy
Money Market and participated in development of makers, shareholders and workforce had always
instruments like Bangladesh Government Islamic been one and that is our guiding principle, and
Investment Bond (BGIIB) and Islamic Interbank Alhamdulillah, this is our key to success. Islamic
Fund Market (IIFM). We always extended banking system so far proved its sustainability in
our support to fellow banks to help them in
the recent worldwide recession. We also note with
maintaining their liquidity in case of need and did
highest appreciation the support and guidance
not take advantage of the financial crisis. Rather
of the regulatory authorities including Ministry of
we assisted other Islamic Banks, Islamic Banking
Finance, Securities and Exchange Commission,
Branches and Windows of Conventional Banks
and Financial Institutions to meet their liquidity. and Bangladesh Bank. The confidence of
The amount of IBBL’s placement to these banks depositors and investment clients who are our
& institutions at the end of 2012 was Tk.15,236 partners in progress is another point of satisfaction.
million (US $ 191 million).

Our Limitations Our Gratefulness
We sincerely feel that we could not yet arrange We consider IBBL as an incomparable gift from
easy and satisfactory customer service at all levels. the Almighty Allah for the people of Bangladesh.
Our depositors still need to remain in the queue for We value it and try to maintain this Amanah inspite
long to deposit and withdraw money. We could not of our all weaknesses and limitations having full
satisfy needs of all investment clients. These are confidence in Allah’s Rahmat. We are grateful to
our limitations but we are trying hard to overcome Almighty Allah (SWT) for His continued blessings
these limitations by arranging Alternate Delivery on us.
Channels (ADCs) in widespread manners and We would like to extend our sincere thanks and
introducing more modern and innovative financial appreciation to all the regulatory authorities, our
services compliant with Islamic Shari‘ah. depositors, investment clients, local & foreign
shareholders and all other stakeholders for
Our Slogan their unfettered confidence. We would also like
to convey heartfelt thanks to the NRBs for the
Our slogan is “Islami Bank, My Bank”, and yearly
confidence reposed on IBBL for their contribution
slogan of the Bank in the year 2012 was “Let’s
to nation building.
go to the 165 million people, let’s decorate our
country”. We are striving hard to expand our Our deepest gratitude to the Government, all
branch network and SME Service Centers to bring regulatory bodies, our fellow Board Members,
the services of Islamic Banking at every door step members of the Shari‘ah Supervisory Committee,
of the people of the country. Bangladesh Association of Banks, Association of
Bankers, Bangladesh, the Bank’s officials and all
Our Dream Stakeholders for their continuous and consistent
support, encouragement, wisdom, input, guidance
IBBL is working for becoming a world class bank
and unrelenting mission in making IBBL a premier
and giving a complete message to the world that
and fastest growing Islamic bank of Bangladesh.
Shari‘ah based ethical banking system contributes
We have many more great things to achieve
the best for sustainability of the world economy
together for the future, and we are confident that
which is so far proven in the prevailing adverse
we will have IBBL’s indelible mark on Bangladesh’s
and eroding economic order. The dream and
future prosperity.
emotion of the workforce and stakeholders of
IBBL is to see their Bank at the pioneer position in Finally, we would like to offer our whole hearted
the industry at home & abroad and to be the role commitment that we are accountable to Almighty
model of the world in the field of Shari‘ah-based Allah (SWT) and answerable to our Stakeholders
banking. IBBL has been giving all out efforts to and to the people of our beloved country & great
translate their dream into reality and to honor the nation.
emotion of its stakeholders.
May Allah grant us success in all our endeavors.
Prof. A.N.M.A. Zaher

Chairman

Managing Director’s Round Up
Respected Stakeholders, talent development to build our capability and

marketing and promotional initiatives to rejuvenate
Assalamu Alaikum Wa Rahmatullah. bank’s brand image. All these have been possible
It is my immense pleasure to pen the progress- with entire confidence of our valued clients and
highlights of Islami Bank Bangladesh Limited, our above all with the blessings of Almighty Allah.
beloved institution that emerged to ensure equity
and justice in the field of all economic activities. Global and National economic scenario
We have been striving in last 29 years to fulfill the
2012 was indeed a year of transformation for
dream of millions of people in Bangladesh through
global economy. It is not merely a year of financial
providing need based banking and welfare
transformation but a year of political reform and
oriented services.
change. Major economies like US, China, Japan,
2012 was another landmark year for Islami Bank Greece, France and Spain saw some political
Bangladesh Limited. Notwithstanding a challenging changes which may redesign the landscape of
economic landscape and an increasingly future global political economy. Last year, a number
competitive operating environment, our Bank of turmoils have engulfed the global financial
continued to grow and meet the expectation of our system and international banks were under
stakeholders. The year witnessed, among others, investigation by regulators in several countries.
the inclusion of IBBL in ‘Top 1000 World Banks’
In the backdrop of economic turmoil in Euro zone
as the lone Bank of Bangladesh which, in turn,
and standoff with US fiscal cliff, the immediate past
increased country’s image in the global arena.
year exposed a mixed blessing to the economy
2012 was also the year that marked success in far- of Bangladesh. The apparel industry, agriculture
reaching delivery channels for greater proximity sector and the wage earners’ remittance have
with customers, upgrading to cutting-edge successfully tackled the trade deficit. Besides, cut
technology to support our business expansion, down of inflation to single digit has brought comfort

in the citizen lives and amid the global economic by 22%. This achievement is the testimony of the
turmoil the achievement of GDP was close to strength of Bank’s core business and its prudent
target. The banking sector in the immediate management. Profit before tax of the Bank was at
past year has experienced some reforms, policy Tk.12,096 million with 17% growth and earnings
changes and volatility in most indices. Besides per share was at Tk.4.42 compared to Tk.3.87 in
focusing on price and financial stability, our central the previous year and capital adequacy ratio was
bank put emphasis on financial inclusion, SME 13.53% (consolidated) at the end of the year. The
loan, automation of services and contributing total assets of the Bank amounted to Tk.592,581
more in CSR activities. million as on December 31, 2012 registering an
increase of Tk.89,968 million. The major increase
Islamic Banking in asset was recorded in aggregate investment
portfolio that grew by 22% during 2012.
Over the years, Islamic finance has become one of
the fastest growing segments in the international
financial system. Islamic banks showed stronger Deposit
resilience during the global financial crisis due to Since beginning IBBL pursued the noble mission
their anchoring in the real economy and barring of being a Bank of mass people through opening
from investing in financial derivatives. Global accounts with minimum initial deposit. We work
Islamic Finance got its highest pace in last few
for increasing national savings to contribute
years. The asset of this real finance reached to
towards country’s economic development. In
USD1.6 trillion and is expected to grow at a higher
2012, IBBL’s total deposit stood at Tk.417,844
rate than the industry average in next few years.
million marking a growth of 22% and market share
In Bangladesh, Islamic Banking retained more increased to 7.72% from 7.59% in 2011. Last
than 18% of total deposit and 21% of total loans year, we introduced a new deposit product named
and advances (investment) of the banking system. Mudaraba School Students Saving Account that
Considering the growth and its role in country’s received wide response of the young generation.
financial sector, central bank took various steps to
facilitate Islamic Banking. Last year Bangladesh Financial Inclusion
Bank introduced Islamic Interbank Fund Market
to mitigate the liquidity and to manage the fund Since inception one of the prime focuses of
in a better way under shariah principles. In the IBBL has been to maximize financial inclusion.
year, Islamic Banks strengthened their strategic We are working to bring financial services to
bondage in terms of liquidity, operational the un-banked people. We added around two
uniformity, manpower development and million clients including 5.62 lac farmer’s and 78
shariah solutions. IBBL played a catalyst role in thousand student accounts to our deposit portfolio
empowering fellow Banks towards Islamization of which is almost double than that in 2011 and the
Banking in Bangladesh. Islami banking community highest number so far in a year. We have taken
participated in different international programs many initiatives to reach the unbanked people and
that helped showcase country’s Islamic banking in
poorer segments in most remote areas especially
global forum. World reputed media like Reuters,
through our RDS program.
Gulf News and Islamic Finance published features/
interview on Islamic banking in Bangladesh.
Investment: Further Diversification
Key Achievements & Developments of 2012 In 2012, Bank’s total Investment stood at
Tk.372,921 million registering a growth of 22%
In the backdrop of volatile global and country
and market share increased to 8.40% from
politico economy as well as regulatory changes,
8.16% in 2011. The investment portfolio has been
Islami Bank Bangladesh Limited made excellent
further diversified in 2012 in terms of size, sector,
performances in different areas of business. Some
economic purpose and rural-urban distribution
of the achievements are highlighted below:
aiming at ensuring distributive justice. Over
the years, Banking in Bangladesh witnessed a
Balance Sheet Management
mismatch with urban-rural ratio being 92% & 8%
Operating profit of the Bank for the year 2012 stood respectively. IBBL is trying to bring change in this
at Tk. 15,608.24 million demonstrating an increase distribution through increasing rural financing that

reached to 14% of our investment in 2012. We We put utmost importance on total human
introduced some new investment products such development throughout the year 2012 and
as Urban Poor Development Scheme, Solar Panel brought qualitative change in the training programs.
Investment Scheme in 2012 aiming at further Intensive professional development program were
diversifying our investment portfolio. conducted to motivate less performing officials.
Outside training at home and abroad has been
Asset Quality imparted to the officials while deserving ones
have been motivated and facilitated to pursue
We made qualitative and quantitative change international standard professional degrees.
in the asset management of the Bank. With
the whole-hearted and integrated effort of all Corporate Governance
manpower, we could achieve better results in
our asset management. Due to global economic We continue to make organizational and structural
recession and volatile domestic market scenario changes for ensuring corporate governance and
our classified investment has increased last year streamline operational procedures. Business units
bringing the same to 3.81% of total investment. like Corporate, Retail, SME were restructured to
However, rescheduled investment reduced to ensure effective decision making, quick disposal
1.98% and around 5,000 classified accounts have and better customer services. A separate Wing
been adjusted in 2012. named Development Wing started functioning to
look after the issues of branding, public relations
and CSR activities. ICT Wing of the Bank has been
Foreign Exchange Portfolio
upgraded considering its multidimensional role in
In 2012, total Foreign Exchange stood at Tk.782,598 modern banking. Internal Control and Compliance
million with 9% growth over 2011. Import stood Wing (ICCW) has been strengthened and re-
at Tk.284,588 million last year with market share oriented with professional auditors and modern
at 10%. Export stood at Tk.197,095 million with logistics. Risk Management Wing (RMW) was
market share 11%. Foreign remittance business redesigned to look after the risk exposures and
was Tk.300,915 million with 28% market share. managing strategies. Research and Development
Division (R&D) has also been strengthened to
Shari‘ah Compliance make our bank as a centre of excellence in the
financial sector of Bangladesh.
We put utmost emphasis on total Shari‘ah
compliance which is the core value of Islamic Branding & Public Relations
Banking. We took different steps in managing
our deposit-investment portfolio to ensure equity Though Islamic banking contributes one fifth
and justice for achieving Maqasid-e-Shariah. of the country’s Banking sector, still the mode,
Awareness for shari‘ah compliance among the mechanism and concept of this Shari‘ah based
entire human resources and the clients has been products lack familiarity among the masses.
a priority that helped improve the position for last As the pioneer in this sector, we took different
steps for enhancing brand image and removing
couple of years. During the year 2012, doubtful
misconception in Islamic Banking. Our activities,
income came down remarkably.
events and programs were duly covered in the
media throughout the year. We sponsored different
Human Capital Development national and international events, fairs, exposition
We believe human resources are our greatest & conferences that brought new dimensions and
assets and recognize them as building blocks enhanced industry image of the bank.
of bank’s performance and development. The
strength of IBBL lies in the young and energetic Information Technology
team who share uniform thinking and possess
In order to provide prompt service to the valued
common goal of human welfare. We continue
customers, our best efforts are given on automation,
to pursue best practices for the development of
developing procedure and reducing manual
human resources. The bank remains focused on
operations. We made substantial development in
recruiting the fresh graduates and implementing
tech-based services like internet banking, SMS
programs to retain high quality human resources. banking and KIOSK named Islami Bank Deposit

Machine. In order to widen access of unbanked  National Best Corporate Award & Best
people by taking advantages of countrywide Corporate Performance Award by the Institute
mobile network coverage, we introduced mobile of Cost and Management Accountants of
banking services with brand name mCash in 2012. Bangladesh (ICMAB)
 The Best Islamic Financial Institution of the
Environment-friendly Banking
country by Goldman Sachs
We believe that every small green step taken  The Most respected company Award by
today would go a long way in building a greener Business Asia.
future and that every one of us can strive towards
a better global environment. IBBL is emphasizing Developments Focus in 2013
on social, ethical and environment friendly
 Providing comprehensive range of fully
approaches to business activity. Since inception
shari‘ah compliant banking solutions
we have been pursuing the spirit of Green Banking
and have not, as such, made any investment  Investing in our people and transforming
in environmentally hazardous areas. Green human resources to human capital
Banking Unit of the bank has been strengthened  Continuous improvement of our product to
and we took some steps in line with central bank meet every household needs
directives. We could substantially reduce the use
 Strengthening drive for financial inclusion and
of paper through automation and simplification.
poverty alleviation
Welfare Activities (CSR)  Maintaining strong capital base and minimizing risk
 Contributing more in industrialization, employment
In 2012, we could maintain our image as the
generation and foreign trade business
leading Bank in CSR through participating in
various social and human welfare issues. We  Diversifying investment with emphasize on
spent around Tk.309 million in different sectors retail, SME and agricultural sector
like education, disaster management, health,  Upholding brand image in remittance through
sports, welfare and humanitarian purpose. Our quality service to expatriates
participation as franchisee of Bangladesh Cricket
 Introducing products and services with support
League and sponsoring National School Football
of superior IT platform
Tournament were appreciated by the sports loving
people of the country.  Conducting business process re-engineering
in different functional areas
Accolades
Concluding Words
The Bank was listed in the ‘Top 1000 World Banks’
of the world by the internationally reputed magazine We would conclude with sincere gratitude to
‘the Banker’ in terms of tier-I capital, 868th in terms Bangladesh Bank for their valuable guidance
of assets size, 70th in terms of return on asset and continuous support. We are also grateful to
(ROA) and 17th in terms of profit on capital. the Board of Directors for their visionary role and
continuous encouragement. We thank high spirited
In recognition to our performance and good
Team IBBL for their dedication, commitment and
governance, we received prestigious award from
renewed vigor. We believe that the success of the
different national and international organizations
Bank has demonstrated the viability and credibility
as mentioned below:
of the Islamic Banking industry as a whole. Let
 SAARC Anniversary Award for Corporate us pray to Allah to give us vision, courage and
Governance Disclosures & Best Presented strength to achieve the target with excellence in
Annual Reports by South Asian Federation of the years to come.
Accountants (SAFA)
 SAARC Anniversary Award for Corporate
Governance & Best Presented Annual Reports
by the Institute of Chartered Accountants of
Bangladesh (ICAB)
(Mohammad Abdul Mannan)
Managing Director &CEO

Management Report and Analysis
World Economic Scenario manufacturing component (9.8 per cent) worked

as key driver of the GDP growth in FY2012. Along
T he world economy suffered considerably

in 2012. Many developed economies are
caught in downward spiraling dynamics from
with it, the construction sector surpassed its
growth target for FY2012 (6.6 per cent) to attain
a robust 8.5 per cent growth. On the other hand,
high unemployment, weak aggregate demand agriculture sector, particularly the crop production
compounded by fiscal austerity, high public debt component, failed to maintain its remarkable track
burdens, and financial fragility. record of the past two fiscal years.
The economic woes of the developed countries Services sector maintained its traditional 6 per cent
are spilling over to developing countries and plus growth rate. It appears that the decline in GDP
economies in transition through weaker demand growth was mostly accounted for by the relatively
for their exports and heightened volatility in capital depressed performance in the agriculture sector,
flows and commodity prices. Most low-income more particularly, its crop component. In contrast,
countries have held up relatively well so far, but industry sector, backed up by its manufacturing
are now also facing intensified adverse spillover and construction sub‐sectors, improved their
effects from the slowdown in both developed and contribution to growth. Indeed, out of 6.3 per cent
major middle-income countries. The prospects growth in FY2012, 2.8 per cent originated from
for the next two years continue to be challenging, the industry sector, the highest in recent history.
fraught with major uncertainties and risks slanted Service sector’s growth contribution was limited to
towards the downside. about 2.9 per cent. On the other hand, growing
Growth of world gross product (WGP) reached 2.2 domestic demand sustained by robust remittance
per cent in 2012 which remained well below the flows had positive impact on the performance of
forecasted potential growth of 2.4 per cent in 2013 the economy. In the second half of the year the
and 3.2 per cent in 2014. inflation went down to single digit although non-
food item’s inflation remained in double digit. Hall-
Global unemployment remained very high, mark scam, Government’s excessive borrowing
particularly among developed economies, with the from banks resulted in adverse effect on private
situation in Europe being the most challenging. investment, series of accident and employees’
The unemployment rate continued to climb, dissatisfaction alongwith unstable energy supply
reaching a record high of nearly 12 per cent in the hampered RMG sector as well as country’s
euro area in 2012. Global financial system was economy.
engulfed by a number of turmoil and several banks
were under regulatory investigation as some Bangladesh Banking Sector
international banks alleged to have committed
money laundering offences. Inspite of having The pace of development in the banking industry
this turmoil global economic situation the Islamic has been significant over the past decades.
banking has been growing faster in recent past Financial inclusion, though still low compared
years and can be foreseen to grow much faster in to developing countries, have increased
the years to come. significantly.
In terms of soundness of the Islamic banking

Bangladesh Economic Scenario sector, the banking sector has exhibited significant
The provisional figure for GDP growth for the progress.
year 2012 was to the tune of 6.3 per cent; i.e. 0.7 In 2012, the banking sector in Bangladesh had
percentage points lower than the target. According a lot of challenges passed through. Of them,
to the BBS estimate, a repeat strong performance financial, bad loan, volatility of foreign exchange
by the industry sector (9.5 per cent), particularly its market, pressure of government borrowing and

high interest rate were mentionable. While this The major sectors of investment are corporate,
sector had some success, others included SME, agriculture, housing, transportation, rural
stable call money market, higher growth in SME development as noted below:
and agriculture loan, opening farmers’ account,
• Corporate Investment
mobile and internet banking and green banking
etc. Industrialization was hampered because The Bank provides a variety of products
of higher spread rate. Some banks incurred and services to large and medium corporate
huge losses from the share market business. areas that include investment, trade finance
Because of increasing demand, more rural for domestic and international transactions,
branches were opened. project finance and syndication services,
treasury, and business. The investment
Business and Financial Overview policy of the Bank was to diversify investment
by size, sector, economic purpose and
In spite of having volatile global and national
geographical location which has positively
economic situation and regulatory changes in
shifted IBBL’s investment towards achieving
2012 Islami Bank Bangladesh Limited was able
Maqasid-al-Shariah.
to show consistent performance in most of the
business areas. It was possible because of bank’s • SME Investment
policy to bringing new customer in the bank arena;
Investment to SME sector forms a lion’s share
strengthen customers relationship providing best
of IBBL’s investment portfolio and covered 47
services, compliance of banking regulations and
per cent of the Bank’s investment in 2012
Shariah rule. Sector-wise brief performance of
against 33 per cent in 2011. This constitutes
IBBL in 2012 alongwith its future strategies are
a significant part of Bank investment, and
given below:
exploits large business potentials in this
sector.
Profit before Income Tax
• Agriculture and Agro-based Industrial
In 2012, the Bank earned highest profit in the
Investment
country’s banking sector, which was Tk. 12,096
million before tax. However, comprising the Investment in Agriculture and Agro-based
income of two subsidiaries of IBBL like, Islami Industry stood at TK. 26,713 million showing
Bank Securities Limited (IBSL) and Islami Bank 25 percent growth in 2012, which was Tk.
Capital Management Limited (IBCML), the 14,252 million in 2011. Allocation in this sector
consolidated profit before income tax in 2012 was as on December 31, 2012 is 7% percent of
Tk. 12,237 million. total investment.
• Rural Development Investment

Deposit
Since its establishment, RDS’s performance
In 2012, the Bank touched the Tk. 400,000 million
has been consistently and gradually
deposit milestone and at the end of the year the
increasing. In 2012, RDS investment stood
figure reached Tk. 417,844 million. This was Tk.
at 14 per cent as against 13 per cent of total
75,990 million higher than the year 2011 making
investment in 2011 with 24 per cent growth.
a growth of 22 per cent. This deposit growth is
In 2012, RDS performance focused better
highest in IBBL’s banking history. In 2012, IBBL’s
than ever, operating in around 15,507 villages
deposit share in the market reached 7.72 per cent
among more than 733,520 members basing
which was 7.59 per cent in 2011.
about 24,623 centers of the country.
General Investment On the other hand, 10 branches in 10 Thanas

under Dhaka and Chittagong metropolitan
In 2012, IBBL’s investment reached to Tk. 372,921 cities started implementing the Urban Poor
million increasing Tk. 67,080 million over the Development Scheme (UPDS) in 2012.
investment of 2011. This investment was 22 per
cent higher than the same was in 2011 and the • Housing Investment
market share of investment reached to 8.40 per
In 2012, the housing investment of the Bank
cent in 2012 compared to 8.16 per cent in 2011.

stood at Tk. 23,231 million representing 6 Information Technology
percent of total general investment. This
The Bank has set up a large and widespread
sector recorded a net increase of 1.98 percent
network of ATMs, introducing of Mobile (mCash)
in 2012 over 2011.
and Internet Banking, Cash Deposit Machine-
• Transportation Investment KISOK are notable. The Bank has covered 1,820
ATMs and already issued 4 lacs ATM cards with
In 2012, Transport Investment of the Bank 35,000 transaction entries per day. The Bank has
was Tk. 6,449 million showing 2 percent share developed country’s largest online network having
of total investment. dual connectivity holding largest Data Centre.
It offers a variety of value-added services to the
Foreign Exchange Business & Treasury ATM Card holders.
Management In order to retain a competitive edge, the Bank’s
technological infrastructure is continuously
The foreign exchange business of the Bank had a
upgraded. It has taken various initiatives to
growth of 9.29 per cent in the year 2012 and stood
increase technology use in its day-to-day
at Tk.782,592 million as against Tk.716,058 million
operations. The bank has extended technology
in 2011. Among 46 AD branches of IBBL 41 were to its Cheque Truncation System (CTS) and
brought into centralized foreign trade processing Bangladesh Electronic Fund Transfer Network
system. IBBL’s Offshore Banking Unit (OBU) (BEFTN) for quick and easy transfer of fund.
started full swing operation and UPAS (Usance
Payment at Sight) business increased manifold. Capital Management
IBBL signed MoU with IFC for investment of
The Bank strives continual enhancement of
US$100 million and introduced Mudaraba Foreign
shareholders’ value through efficient use of
Currency Investment for smooth operation of
available capital in a manner that leads to a high
this growing business. IBBL’s exchange earning
return on equity. The Bank has also implemented
and money market income increased by 53 and the Revised Guidelines on Risk Based Capital
37 per cent, respectively in 2012. The foreign Adequacy for Banks (BASEL II). In the year 2012
exchange business contributed by import, export the Bank maintained 13.53 as on 31.12.2012
and remittance are given below: (consolidated) Capital Adequacy Ratio (CAR) as
against required minimum 10.00 percent.
•
Import: In 2012, Import business of the
bank stood at Tk. 284,588 million making a
Operations and Compliance
negative growth of 5.52 per cent against Tk.
301,207 million in 2011. This negative growth In spite of volatile national and global economic
could be the effect of the Government policy situation, the Bank adheres to the highest
of controlling/reducing import of the country. standards of risk management and compliance.
The compliance policies of the Bank are
• Export: Export business handled by the Bank formulated following the standards and policies
was Tk.197,095 million with the growth rate of of national and international regulatory and non-
10.57 percent in the year 2012 as against Tk. regulatory bodies. During the year, the regulatory
178,244 million in 2011; guidelines on “Know Your Customer (KYC)” norms
implementation were strengthened to prevent
• Foreign Remittance: Bank’s total remittance fraud and forgery.
stood at Tk.300,915 million showing a growth
rate of 27.17 percent in the year 2012 as Financial Inclusion
against Tk. 236,607 million in the year 2011.
The year 2012 can be considered the year of
The Bank has an integrated Treasury which covers financial inclusion for IBBL. In that year, the Bank
both domestic and global markets and funds. The put special drive to reach the unbanked people
dealing rooms assist customers in managing through different programs and was able to
their foreign currency exposures, simultaneously open 5.62 lac farmers’ accounts, 78,000 Student
maintaining proprietary positions of the Bank. accounts, 7,100 Mohor accounts and 17,400 Cash
Waqf accounts.

Green Banking Moreover, the Bank is always ready to meet the
challenges it might face in its pursuit of higher
The Bank used to emphasize on social, ethical growth and development, so that the year 2013
and environmentally responsible approaches to would not be an exception. The short-term and
business activities. Keeping in view the spirit of mid-term strategies to achieve the desired success
Green Banking IBBL opened a Green Banking are as follows:
Department under its Risk Management Wing
(RMW) and took some effective steps in line with • New and innovative products on deposit and
Central Bank’s directives. By now, the Bank was investment
able to reduce paper use substantially through
• Bringing the SME under the main stream of
automation and simplification of its activities.
investment to absorb a huge section of people
Besides, the Bank’s Green Banking policy is at the
for employment.
final stage of approval.
• Proper decoration and maintenance of
CSR Activities all floors of the head office, zonal offices,
branches and corporate branches.
IBBL through its various CSR programs is
contributing significantly to develop socio • Further extension of ATM services up to
economic condition of Bangladesh. Bank spent remote areas.
around Tk. 309 million as CSR expenditure in
• Increase of AD branches to widen foreign
various sectors such as disaster management,
exchange business and remittance
education, health, sports, art & culture,
operations.
environment and others. In 2012, CSR program
of IBBL received a momentum. IBBL participated • Opening of more branches at upazilas and
as franchise of Bangladesh Cricket League and commercially important places
sponsored National School Football Tournament
which was appreciated by population at different • Vigorous steps will be adopted for recovery of
strata of society. defaulted investment
• Measures will be taken to open 30 lac new

Outlook for 2013 accounts in 2013 where by total 1 crore
accounts will be may be achieved
In Bangladesh, 2013 is the year of national election
and so some political unrest is not unlikely which • CSR activities will be streamlined by
might hamper the normal economic activities of formulating a pragmatic CSR policy.
the country. Despite this limitation, the financial
sector of Bangladesh is expected to keep growing • Automation activities will be strengthened
and this will have positive impact on economy. under Green Banking to reduce dependence
IBBL will try to focus more on financial inclusion on paper.
providing technology based banking facilities to • In 2013 efforts be geared to increase the
its existing and potential large customer base. number of branches to 300, Insha Allah.

Directors’ Report

Report of The Board of Directors
In the name of Allah Most Gracious, Most Merciful
A ll praises are due to Allah, the Lord of the

Universe, and Peace and Blessings of Allah
be upon the Prophet Muhammad (Sm.) and his
territory. Likewise, China, India, and Japan are
hovering around uncertainty about future direction
of their economies and scrambling to maintain
Descendants and Companions. economic growth.
Esteemed Shareholders Euro Zone

Assalamu Alaikum wa Rahmatullah, The key challenge for the Euro zone pertains to
uncertainty about the growth outlook for Europe
On behalf of the Board of Directors, I take
for 2013 and beyond. The case for strong growth
the opportunity to welcome you all to the 30th
in 2013 is weak. The most likely scenario for the
Annual General Meeting of the Bank and have
Euro zone is a stabilization of production in the
the pleasure to place before you the Annual
first half of 2013, followed by a slow and sluggish
Report 2012 along with the Auditors’ Report and
recovery. For the whole year 2013, the Euro zone
Audited Financial Statements of the Bank for
is likely to achieve a growth rate hardly above zero
the year ended December 31, 2012. I consider
(0.2 percent), and the crisis countries in Euro zone
it appropriate to bring forth before you the
will still have negative growth even if it is expected
contemporary global economic scenario, changes
to be less negative than in 2012.
that took place around the world, how Bangladesh
experienced the same and various functional and
administrative aspects for the year 2012 in the Euro Zone GDP Growth in 2012 and
following chapters. 2013 (in %)
Global Economic Outlook

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United States
Global Economic Scenario The US economic recovery shaken violently to a

halt in the final months of 2012 as the government
2012 was a year of pronounced economic slashed defense spending, businesses cut back,
uncertainty for many countries and for most of and fighting over the fiscal cliff. Its GDP shrank
them this trend is likely to linger into 2013. Fiscal during the fourth quarter, dropping at an annual
crisis in Europe threatened survival of the euro, rate of -0.1%. It was the US’s worst economic
though eventually disintegration could be avoided. performance since October 2009 expecting mild
The US could hardly avoid entering recessionary growth of about 1% in 2012.

US GDP-Quarterly Growth: 2010 to 2012 (%) advanced economies and emerging markets that
are net oil importers.
ϰ͘ϱ
ϰ͘ϭ
ϰ The National Economy
ϯ͘ϱ
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Bangladeshi economy, with its growing global
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Ϯ͘ϰ interconnectedness, can hardly be immune to
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what in happening in the outer world. The Euro
ϭ͘ϯ
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ϭ͘ϱ
zone crisis is far from over. U.S.A struggles with
ϭ recovery. So jobs and income are likely to offset
Ϭ͘ϱ here at home for what happened in the distant US
Ϭ͘ϭ
Ϭ͘ϭ
Ϭ capital and in Euro zone. Yet Bangladesh can be
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ϮϬϭϬ ϮϬϭϭ ϮϬϭϮ
pay hikes of RMG workers both in India and China
as evidenced by the higher demand orders coming
Negative GDP growth in the fourth quarter and the from these two countries.
likely outcomes of the fiscal cliff suggest that the Bangladeshi economy may face challenges in
US economy will find itself in recessionary territory 2013 from within as well. The root of the difficulties
in early 2013. can be traced back to policies pursued in the
past fiscal year with a mismatch in the budgetary
Emerging Market Economies expenditures far outstripping receipts. Any attempt
to plug this deficit by excessive bank borrowing
Among the emerging market economies, China’s would push up inflation. Enhancements in
economy, after slowing substantially in 2012, electricity prices would have spiral effects on cost
is showing signs of reverting to faster growth. of living thriving inflation rate up further defeating
PMI index for manufacturing moved into positive the monetary objective of taming inflation.
territory at the end of the year. Retail sales growth
also multiplied suggesting that the consumer
The Banking Sector
sector was improving. However, FDI into China
declined consecutively in 2012. On the other The Banking sector in Bangladesh suffers from
hand, outflow of FDI from China increased 25.8 high deposit and lending rates syndrome. Both
percent last year. deposit and lending rates are reigning at a higher
level with a flat spread. The situation is created
Growing fiscal deficit, low investments, elevated
out of bubbling and burst of capital market against
inflation, and high interest rates are looming over
a persisting high inflation during the last three
India’s outlook. The country’s GDP grew 5.3
years. The situation led to deposit flights from the
percent in the second quarter of the 2012-2013,
banking sector to capital market leading to pushing
one of its lowest quarterly growth rates in the last
up deposit and lending rates in future threatening
decade. Overall, the Indian economy is showing
hard-earned external competitiveness of our
early signs of a recovery. Industrial production
economy. The intervention by Bangladesh Bank
grew 8.2 percent, supported by an improvement
in the nomenclature of accommodative monetary
in services sector.
policy without having corresponding fiscal regime
Indonesia, Malaysia and Thailand experienced in place, led to reduction of general inflation rate
declining trend of growth in 2012. ASEAN as by few points only, but not the non-food inflation
group is projected to grow at a slower pace of 5.5 at all, making it counterproductive eventually
percent in 2013 against 5.7 percent in 2012. curtailing both export and import growth.
Finally, the entire greater Middle East—from Higher deposit rates have pushed up cost of fund in
the Maghreb to Afghanistan and Pakistan—is 2012 leading to declining in foreign trade, thereby
socially, economically, and politically unstable. scaling down operating profits of banks last year.
Any further escalation of conflicts in Middle East Average cost of fund was hovering between 11
may significantly rise and increase oil prices by 20 per cent and 12 per cent for most of the time in
percent, leading to negative growth effects in the 2012 which was 9.0 per cent to 10 per cent in the
U.S., Europe, Japan, China, India and all other previous year. The weighted average lending rate

stood at 13.94 per cent in November 2012. As a Islamic banks show commendable strengths in
result, credit growth in private sector slowed down their operation. Performance of Islamic banking in
in 2012. Bangladesh is remarkable in terms of its growth
and market share in the economy.
The sluggish trend in the country’s capital market,
cautious monetary policy, lower import payments As of 30.09.2012, annual deposit and investment
and loan scams were responsible for lower level of growth of IBs were 25.9% and 29.5% respectively
profits of the banks in 2012. compared to 19.9% and 21.1% growth of the
banking sector. Market share of IBs in deposit
Islamic Banking around the World and investment is recorded as 17.5%, and 20.7%
respectively.
Islamic finance industry is one of the fastest
growing segments of the global financial industry.
In 2008 the size of the global Islamic banking Market Share of Islamic Banks (IBs)
industry was estimated about $820 billion.
The size of the industry crossed $1.6 trillion by Ϯϱ͘Ϭ
2012. The industry now comprises 430 Islamic
DĂƌŬĞƚ^ŚĂƌĞŝŶй
banks and financial institutions and around 191 ϮϬ͘Ϭ
conventional banks having Islamic banking ϭϱ͘Ϭ
windows operating in more than 75 countries (3rd
ϭϬ͘Ϭ
Global Islamic Finance Report 2012).
ϱ͘Ϭ
Global Islamic finance maintained compound
annual growth rate (CAGR) of 18.82% from Ϭ͘Ϭ
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2006 to 2011. It is set to double in size between
2011 and 2015 with the sector increasingly /ƐDĂƌŬĞƚ^ŚĂƌĞ ϭϵ͘Ϭ Ϯϯ͘ϴ ϯ͘ϯ ϮϬ͘ϵ ϭϯ͘ϯ
viewed as a real alternative to conventional
finance, expressed in a seminar organized by On the other hand, IB’s market share in industry,
Standard & Poor’s in September 25, 2012. The trade, agriculture, real estate and transport
global crisis faced by conventional finance led financing accounts as 19.0%, 23.8%, 3.3%, 20.9%
to Islamic Finance increasingly being viewed as and 13.3% respectively.
a credible alternative. S&P expects the industry
to grow 20% annually over period of 2011-2015.
Institutional Development of Islamic
Islamic finance is gaining groud and has continued Banks
to demonstrate its viability and competitiveness in
the globalised financial environment. Islamic Banks Consultative Forum (IBCF):
IBCF, with Islamic Banks and Conventional Banks
Islamic finance draws its strength from serving having Islamic Banking Branches as members,
the real economy. An important feature of Islamic was established in 1995 for effective interaction,
finance is that it involves financial transactions that cooperation, promotion and furthering of the cause
must be accompanied by an underlying economic of Islamic banking in Bangladesh. Seven full-
transaction. fledged Islamic Banks and six Banks having Islamic
Banking Branches are the members of the IBCF.
Islamic Banking in Bangladesh
Central Shari‘ah Board for Islamic Banks of
At present, there are seven full-fledged Islamic Bangladesh (CSBIBB): CSBIBB was established in
banks (IBs), nine conventional banks with Islamic 2001 to offer views and assistance to member banks
banking branches and eight other conventional in matters related to observance of uniform Islamic
banks operating with Islamic banking windows. banking policies and practices. It also promotes
Most of the State-Owned Banks are said to be knowledge on Islamic Banking by organizing
planning to open Islamic banking branches or seminars and conducting training and research on
windows. By the end of 2012, there were 770 Islamic Shari‘ah. Seven full-fledged Islamic Banks
Islamic banking branches and 30 Islami banking and ten Conventional Banks having Islamic Banking
windows in Bangladesh. Branches are the members of CSBIBB.

Islami Interbank Fund Market (IIFM): In order
to mitigate liquidity crisis of Shari‘ah based banks
and financial institutions and for their better
management, Bangladesh Bank introduced
Islami Interbank Fund Market in 2012. Under
this arrangement an interested Islamic financial
institution can place their surplus fund overnight
at Bangladesh Bank. Islamic banks and banks
having Islamic banking branches and windows
may borrow from this fund overnight. IIFM is
expected to play a critical role in the development
of Islamic Money Market in Bangladesh.
Bangladesh Government Islamic Investment

Bond (BGIIB)
The Ministry of Finance, Government of

Bangladesh introduced the BGIIB in 2004. The
instrument has been playing an important role in
developing Islamic Money Market. The unit price
of the Bond is taka 1 (one) lac. One can purchase • Investment is made through different modes
the Bond for taka 1 (one) lac or multiple thereof as per Islamic Shari‘ah.
having tenure of 6 (six) months, 1 (one) year or 2
(two) years. The Bond is treated as a component • Investment-income is shared with Mudaraba
of Statutory Liquidity Ratio (SLR). depositors according to pre-agreed ratio,
ensuring a reasonably fair rate of return on
IBBL is actively involved in buying and redeeming their deposits.
of the bond. The closing balance of IBBL against
this Bond was Tk.23,434 million in 2012. • Introduction of welfare-oriented banking
to ensure equity and justice in all of its
Islami Bank Bangladesh Limited operations.
Islami Bank Bangladesh Limited was incorporated • Extend socio-economic and financial services
as the first Shari‘ah based interest-free bank to people of all strata with a strong commitment
in South-East Asia on the 13th March 1983 as to rural upliftment.
a public limited company. The first branch of • Plays a vital role in human resources
the Bank i.e. Local Office at Motijheel in Dhaka development and employment-generation
started functioning informally on 30th March 1983. particularly among the unemployed youths.
It was formally inaugurated on 12th August 1983.
The Bank was established with Tk.80.00 million • Portfolio of investment and investment policy
as paid up capital which has been increased to have specially been tailored to achieving
Tk.12,509.64 million as on 31.12.2012. Corporate balanced growth and equitable development
Headquarter of the Bank, housed in an 18-storied through diversified investment operations
own modern building, is located at 40, Dilkusha particularly in the priority sectors and in the
Commercial Area, Dhaka. less developed areas of the national economy.
• Ensures Shari‘ah compliance through regular

Special Features of IBBL and effective guidance provided by our
IBBL achieved stable growth and continuous independent and highly esteemed Shari‘ah
progress to become the leading private commercial Supervisory Committee consisting of 12
bank of the country. The distinguished features of members.
IBBL are: • IBBL has some special Investment schemes
• All activities are conducted on interest-free for different segments of the people to meet
system based on Islamic Shari‘ah. their specific needs.

Prime Minister Sheikh Hasina is handing over cheque of taka 19 lac and 20 thousand for fourth year out of taka one crore and ninety two lac for ten
years committed by the Bank to the four Army Officers families.
• It follows system of strong motivation amongst are known as corporate branch and those are
all the stakeholders to induce themselves to presently looked after by Head Office. Zonal
contribute their best for their own wellbeing as Incharges are responsible for effective control,
well as the wellbeing of the soceity itself. close supervision and proper monitoring of the
total operations of the branches as well as to
• IBBL is very much engaged in CSR activities
assist them in the development of business in their
and contributes every year a handsome
respective jurisdiction.
amount in this area.
Number of Branches
Our Network
To provide smooth services at the doorstep of the ϯϬϬ Ϯϳϲ
Ϯϲϲ
customers, IBBL goes on expanding its branch Ϯϱϭ
ϮϱϬ
network to all suitable places all over the country.
The Bank opened 10 new Branches in 2012 ϮϬϬ
ϭϲϵ
raising the total number of Branches from 266 ϭϱϬ
to 276. The Bank plans to gradually open more ϭϭϲ
ϵϬ
branches covering important commercial places ϭϬϬ
both in urban and rural areas. ϰϵ
ϱϬ
ϭϯ
Out of total 276 Branches (including 30 SME/ Ϭ
Agriculture Branches), 81.16%, i.e., 224 are Urban ϭϵϴϱ ϭϵϵϬ ϭϵϵϱ ϮϬϬϬ ϮϬϬϱ ϮϬϭϬ ϮϬϭϭ ϮϬϭϮ
Branches and 18.84%, i.e. 52 are Rural Branches.
IBBL has the highest number of rural branches
among the first generation Private Banks. Subsidiary Companies
Islami Bank Securities Limited (IBSL)
Branch Cluster Management
Islami Bank Securities Limited (IBSL) is a
Our 272 Branches are managed and supervised
subsidiary company of Islami Bank Bangladesh
by the Zonal Offices. There are 14 (fourteen)
Limited (IBBL) which was incorporated in March
Zonal Heads to run those branches smoothly
22, 2010 as a Public Limited Company under
and efficiently. The remaining 4 (four) branches

Inauguration of Bahaddarhat Branch
Companies Act, 1994 with the objective to carry Islami Bank Capital Management Limited
out Business of Stock Broker & Dealer in the (IBCML)
capital Market. The overall increase of activities
Islami Bank Capital Management Limited was
of Brokerage operation play an important role
established in April 2010 under the Companies
in improvement of capital market of the country
Act, 1994 as a Public Limited Company with
and enhances earning capability of IBBL through Authorized Capital of Tk.1000.00 million & Paid-
Corporate declaration. Up Capital of Tk.300.00 million. The Company was
established as per Bangladesh Bank Letter No.
The Board of IBSL approved its products for
BRPD(R-1)717/2011-47 dated 07 February 2010.
providing investment facilities to the prospective
The registered Office of the company is situated at
customers to invest in secondary market having 63, Dilkusha C/A in Dhaka, Bangladesh.
the option to operate under Investment Facility
and Non Investment Facility accounts. IBSL has The main objectives of the company are to carry out
all sorts of Merchant Banking businesses including
diversified products with different category of
underwriting and/or Management of issues, Public
investment ceiling and other value added services
offer of Shares, Stocks, Debentures, Bonds
for the prospective customers. It also provides etc., sale and purchase of Securities or transfer
different depository services to its BO account thereof, Fund Management of clients, Managing
holders as a full DP (Depository Participant) Portfolio Investment of any person or Company by
of CDBL. They can also avail the services making profitable Investment in various avenues.
through Member’s discretionary and Investors’ The Company is yet to start its operations.
discretionary accounts. The NRBs’ can also
avail the services through NITA Account maintain IBBL Exchange Singapore Pte. Ltd
with AD Branches of IBBL. IBSL organizes IBBL Exchange Singapore Pte. Ltd. was
“Investors Awareness Program” on regular basis. incorporated in Singapore as a subsidiary of IBBL
As per decision of the Board, IBSL has a plan for money-remittance, changing, transmitting and
to open some branches in 2013 in all divisional doing all matters and things incidental thereto
headquarters of the country subject to approval of under the Companies Act, CAP.50 of the Republic
of Singapore.
the concerned Authority.

Off-Shore Banking Units International Affiliations
Bangladesh Bank approved operation of Off- IBBL is a member of the under noted foreign
Shore Banking Units (OBU) of Islami Bank organizations:
Bangladesh Limited located at Head Office
a. Accounting and Auditing Organizations
Complex Branch-Dhaka, Uttara Branch-Dhaka
for Islamic Financial Institutions (AAOIFI),
and Agrabad Branch-Chittagong. Operations of
Off-Shore Banking Units (OBU) commenced on Manama, Bahrain and has become member
January 4, 2011. of its Board of Trustees.
b. Islamic Financial Services Board (IFSB),
National Affiliations Kuala Lumpur, Malaysia.
IBBL became member of the Dhaka Stock c. General Council for Islamic Banks and
Exchange Limited in the year 2006. License for Financial Institutions (CIBAFI), Manama,
Depository Partnership (DP) from the Securities Bahrain
and Exchange Commission (SEC) and Central
d. International Islamic Financial Market (IIFM)
Depository Bangladesh Ltd. (CDBL) was obtained
Manama, Bahrain
earlier. Function of Brokerage House and full
DP service were initiated on 1 January 2008 e. International Islamic Centre for Reconciliation
obtaining the permission of Bangladesh Bank. and Arbitration (IICRA)
The membership was transferred to Islami Bank
f. International Chamber of Commerce-
Securities Ltd., a subsidiary company of IBBL in
Bangladesh (ICC-Bangladesh)
2010 as per requirement of Bangladesh Bank and
Securities & Exchange Commission. g. American Chamber of Commerce in
Bangladesh (AmCham)
Membership in National Bodies
IBBL is a member of the following institutions: IBBL’s Equity Investment
a. Bangladesh Institute of Bank Management IBBL has the equity investment in the follwing
(BIBM) institutions:
b. The Institute of Bankers, Bangladesh (IBB) a. Central Depository Bangladesh Limited

(CDBL)
c. Bangladesh Association of Banks(BAB)
b. Karmasangsthan Bank (Employment Bank)
d. Bangladesh Foreign Exchange Dealers’
Association (BAFEDA) c. Bangladesh Shipping Corporation (BSC)
e. Central Shari‘ah Board for Islamic Banks in d. Bangladesh Aroma Tea Ltd.
Bangladesh (CSBIBB)
e. Financial Institutions and Investors Portfolio
f. Islamic Banks Consultative Forum (IBCF) Management Company Limited
g. Dhaka Chamber of Commerce & Industry
(DCCI)

Corporate Governance
C orporate Governance policies and practices

of IBBL are focused on ensuring proper
delegation, transparency and accountability
The Board is comprised of experienced members
with diverse professional experiences such as
business, administration, banking & finance,
in the organization as a whole. The bank is accounting, general management representing
structured and developed in line with the accepted Government service holder, engineers, fund
Corporate Governance practices and guidelines managers which make the Board very efficient
of Bangladesh Bank and the Bangladesh and balanced in deciding and directing various
Securities and Exchange Commission’s (BSEC) issues of the Bank.
notifications in this regard. While pursuing the
The present Board consists of 19 (nineteen)
interest of Shareholders’ value addition, the bank
non-executive members including 03 (three)
has attached utmost importance in setting up of
Independent Directors and 02 (two) Depositors
a well-defined compliance oriented organization
Directors excluding ex-officio Managing Director.
and business structure.
The number of Board members is within the limit
set by the Bangladesh Bank, the primary regulator
Board of Directors, Chairman for banking industry in Bangladesh.
and CEO
The Executive Committee
Policy on Appointment of Directors
The Executive Committee, consisting of 5 (five)
The members of the Board of Directors of IBBL are members, is entrusted with the responsibilities of
appointed pursuant to the provision of Companies policy making and taking important and strategic
Act 1994, Securities and Exchange Regulations decisions as authorized by the Board within the
and Memorandum & Articles of Association of norms set by Bangladesh Bank.
the Bank. The Guidelines of Bangladesh Bank is
strictly complied with in the formation of the Board. Non-Executive Director
Independent Directors and Depositor Directors
All the Directors of IBBL are non-executive
are appointed by the Board as per regulatory
Directors except the Managing Director.
requirement.
Meeting of the Executive Committee

Independent Director administrative or operational and routine affairs of
the bank.
Board has appointed 03 (three) Independent
Directors in conformity with the latest corporate The Chairman conducts on-site inspection of any
governance notification guidelines of regulatory branch of the bank or financing activities under
authorities. The Independent Directors enjoy the purview of the oversight responsibilities of
full independence in terms of carrying out their the Board. He calls for any information relating to
coveted responsibilities. Independent Directors Bank’s operation or ask for investgation into any
are well conversant in the field of business and such affairs; he also submits such information or
professional areas. The independent directors investigation report to the meeting of the Board or
have more than 12 (twelve) years of corporate the Executive Committee and if deems necessary,
management / professional experiences. with the approval of the Board, he takes necessary
action thereon in accordance with the set rules
Chairman is Independent of Chief through the CEO. The board also has the policy
of appraising Bangladesh Bank regarding any
Executive Officer/Managing Director
complaints against CEO along with his statement.
Being appointed by the Board, the Chairman of
IBBL is independent of CEO. The Chairman of the Duties and Responsibilities of CEO, CFO
Bank is elected by the directors of the Bank. The
& Company Secretary
Board of Directors has clearly defined roles and
responsibilities of the Chairman and the CEO. The duties and responsibilities of Chief Executive
Officer (CEO), Chief Financial Officer (CFO)
Independence of Board Members and Company Secretary (CS), as defined by the
regulators, are approved by the Board of Directors.
The Board members are also independent in
expressing their views and opinions freely. The
directors are also independent from management Appointment of CFO, Head of Audit and
and other relationships of the Bank that could Company Secretary
materially affect the activities of the Bank.
The bank appointed a Chief Financial Officer
(CFO), a Head of Internal Audit (Internal Control
The Role and Responsibilities of the and Compliance) and a Company Secretary (CS).
Board of Directors The Board of Directors has defined clearly the
roles, responsibilities and duties of the CFO, the
The basic responsibility of the Board is to exercise
Head of Internal Audit, and the CS.
business judgment in good faith, in a manner that
they reasonably believe to be in the best interests of
the Bank, while complying with the applicable laws Independence of Non-Executive
and regulations, the Bank’s Articles of Association Directors
and resolutions adopted by the shareholders. The
major responsibilities of the Board, among others, All the non-executive Directors enjoy full freedom
are to set the direction, vision and policies of the Bank and independence. They also adhere to the
and to determine objectives and strategies to ensure corporate governance practices and guidelines.
the effective discharge of the Bank’s functions and
the most efficient use of the Bank’s resources. Annual Appraisal of the Board’s
Performance
Responsibilities of the Chairman of
In every Board meeting, the attendance of
Board of Directors the Directors is considered and their active
The responsibilities of the Chairman as defined participation in the various agenda is ensured.
in the BRPD Circular No.06, dated February 04, The performance of the Board is also appraised in
2011 of Bangladesh Bank is fully complied with. various ways like submission of the Performance
The Chairman of the Board of Directors does not of the Bank in the Board meeting periodically,
personally possess the jurisdiction to apply policy preparation and monitoring of budget, placing
making or executive authority. The chairman implementation status of the Board’s decisions,
also does not participate in or interfere into the transacting business issues which are within

its power and placing implementation status Directors’ Report on Compliance with
of Bangladesh Bank’s observations on various Best Practice on Corporate Governance
issues. Furthermore, the performance report of
the committees framed by the Board is also placed Status of compliance of corporate governance
in the Board through which the performance of checklist is included in the Directors’ Report which
the Board members are regularly evaluated. is dully certified by the external auditors of the
bank.
Annual Evaluation of the CEO by the
Board Accountability, Audit and Financial
Reporting
The Board has a policy of annual evaluation of the
Managing Director. Additionally, the performance The Board undertakes responsibilities for preparing
evaluation of the CEO is conducted by the Board and presenting a balanced and comprehensive
through various reports like performance report of assessment of the Bank’s operations at the end
the bank, taking status of various assignments given of the each financial year through annual Financial
by the Board to the CEO and the Management, Statements and Annual Report and quarterly and
taking implementation status of Budget etc. half yearly announcement of results of the Bank
to the Shareholders. The Audit Committee of the
Policy on Training of Directors Board assists in this respect by scrutinizing the
information to be disclosed, and to ensure accuracy,
The Policy on training of Directors includes adequacy, transparency and completeness.
providing training and information on all the
latest policy guidelines and circulars issued by Vision, Mission and Strategy
the regulatory authorities. Sometimes special
discussion sessions are arranged with the • The Vision and Mission of the Bank are
experts. They also attend the programs organised approved by the Board. These are disclosed
by various professional bodies at home and in the annual report, bank’s website and other
abroad on technical, professional and corporate publications.
governance issues. • Business Objectives are focused and the
areas of busineses are set out to attain vision,
Directors’ Knowledge and Expertise in mission and strategic objectives.
Finance and Accounting • The Strategies to achieve the Business
Three Directors in the Board of the Bank are Objectives are clraly set out and disclosed in
professionally qualified Chartered Accountants. the previous section of this annual report.
They are well conversant in the field of accounting
and finance. Other Directors are also well Audit Committee
conversant in the field of business, administration The Audit Committee is responsible to the Board
and own professional areas. of Directors. The duties of the Audit Committee
are clearly set forth in writing. The Company
Number of Board Meetings Secretary acts as the secretary of the Committee.
At least an independent director is required to fulfil
In 2012, 20 (twenty) Board meetings were held.
the quorum of the audit committee.
A detailed disclosure showing number of Board
Meetings held and status of participation of the
Directors is given in the later part. Appointment and Composition
Audit Committee of the Bank, comprising of 4
Attendance of CFO and Company (four) Members, has been formed in compliance
Secretary with Bangladesh Bank & BSEC guidelines. The
Committee is comprised of 2 (two) Depositor
The CFO and the Company Secretary of the Directors, an Independent Director and a Foreign
bank attend meetings of the Board of Directors, Director of the Board. Company Secretary
excluding those, which involve consideration of an acts as the secretary of the Committee while
agenda item relating to their personal matters.

Meeting of the Audit Committee
other members of the Management attend the Expertise in Finance and Accounting
Committee Meeting on invitation only.
All the members of the Audit Committee have
Chairman of the Audit Committee adequate knowledge in Accounting and Finance.
of them, three are professional accountants having
The Chairman of the Audit Committee is an degrees on Chartered Accountancy, one of whom
independent Non-executive Director and he is also a Fellow Member of Chartered Secretaries
performs his duties independently.
and also serving as a President in the highest
accounting body of the country, the ICAB. One
Terms of Reference of Audit Committee of the members is Vice Chancellor of a private
The Audit Committee of IBBL strictly observes the university having PhD degree.
Terms of Reference of the Committee issued by
Bangladesh Bank through BRPD circular no. 12 Head of Internal Audit’s Access to Audit
dated December 23, 2002. As per the terms of the Committee
said Circular, the Audit Committee plays a key role
in finalization of the Financial Statements of the Head of Internal Control and Compliance Wing
Bank. It also reviews the Internal Control System has direct access to the Audit Committee and he
of the Bank, Internal Audit Reports, External attends the Audit Committee meetings regularly.
Audit Reports, Bangladesh Bank Inspection
Reports, Shari‘ah Inspection Report and provides Review and Evaluation of Quarterly Report
necessary Policy Guidelines.
The Audit Committee reviews and evaluates the
The Committee is empowered to investigate/
quarterly reports and refers the same to the Board.
question any employee of the Bank. It can also take
External Expert Counsel, if it deems necessary.
Meeting of Audit Committee
Non-Executive Director The Audit Committee conducted 22 meetings during
2012. The attendance status of the meeting is given
All the Members of the Audit Committee are Non-
executive Directors. No executive of IBBL are eligible at the end of this Corporate Governance Report.
to become a member of the Audit Committee.

Objectives & Activities of the • Non-Audit Work: During 2012, External
Auditors were not assigned any work except
Audit Committee Statutory Audit and certification of corporate
Governance as required by BSEC.
Review of Internal Control
The Audit Committee regularly reviews the Internal Selection of Appropriate Accounting
Control System of the Bank. It ensures that the Policies
Internal Control Systems are well conceived by all
concerned and properly administrated at all levels. The issues related to selection of appropriate
The Committee also monitors observance of Accounting Policies in line with IFRS, BFRS and
Internal Control Practices with a regular interval. other Regulatory Guidelines were discussed in the
Audit Committee meeting. The Accounting Policies
are annually reviewed at the time of finalization of
Role of Audit Committee in Ensuring
Financial Statements.
Regulatory Compliance
The Committee reviewed and examined the Annual and Interim Financial Releases
Financial Statements of 2012 of the Bank to see
Audit Committee reviews Annual and Interim
whether all the disclosures and information have
Financial Statements release and recommends
been incorporated in the Financial Statements
the same to the Board for approval.
properly and whether the Bank followed
International Financial Reporting Standards (IFRS)
adopted as Bangladesh Financial Reporting Reliability on the Management
Standards (BFRS) by the Institute of Chartered Information
Accountants of Bangladesh, Bank Company Act
The Audit Committee ensures that all the information
1991, the Companies Act 1994, the Securities and
used for computation of financial disclosures are
Exchange Rules 1987, Dhaka and Chittagong Stock
reliable.
Exchange Listing Regulations and other Laws and
Rules applicable in Bangladesh and Standards
issued by the Accounting and Auditing Organization Internal Control & Risk Management
for Islamic Financial Institutions (AAOIFI) etc.
Directors’ Responsibility to Establish
Review of External Audit Functions Internal Control
• Effective Coordination of Externatal Audit The Board of Directors of IBBL is responsible to
Functions: Before finalization of the Financial establish appropriate system of Internal Control. To
Statements, the Committee met with the ensure appropriate level of Internal Control System,
External Auditors and discussed various a good number of Manuals and Guidelines have
issues relating to Financial Statements for the been introduced in line with global best practices
year 2012. The Committee also reviewed the and Regulatory Guidelines. Delegation of powers
progress of Audit from time to time. in various business, administrative and financial
areas have also been approved by the Board.
• Ensure Independence of External
Auditors: The Committee ensures that the
External Auditors perform the audit with due Features of Internal Control, Compliance
independence. and Monitoring System
• Review of External Auditors Findings: Internal Control and Compliance Wing (ICCW) of
The Committee reviews findings of External IBBL is responsible for checking compliance of
Auditors, action taken on each items Internal Control System. Any deviation is reported
and necessary instructions given to the to the top Management, Audit Committee and to
Management on the findings of the Auditors. the Board and necessary steps are taken to rectify
• External Auditors’ appointment and the same.
Reappointment: Every year the Audit As per Bangladesh Bank Guidelines and to
Committee recommends Appointment/Re- strengthen the Control and Compliance Mechanism,
appointment of External Auditors.

the Bank has established Internal Control and Bangladesh Bank guidelines. All the issues are
Compliance Wing consisting of three Divisions: periodically reviewed by the Audit Committee.
a. Audit & Inspection Division: This division
undertakes the audit and inspection of all Review of Adequacy of Internal Control
operating units of the bank including Head System
Office, based on an approved Audit Plan,
The Board of Directors time to time reviews
which is approved by the Audit Committee of
the Internal Control System and necessary
the bank.
modification is done to improve the system and to
As per guidelines of Bangladesh Bank, incorporate latest changes in the technology.
Internal Control & Compliance Wing of IBBL
submitted a summary report on the Audit Inspection by Bangladesh Bank
findings during the year 2012 and placed
the same to the Managing Director and to Bangladesh Bank conducted the Comprehensive
the Audit Committee for their perusal and Inspection of IBBL, Head Office and its 27
guidance. selected Branches in 2013 based on the position
as on 31.12.2012. Moreover, Bangladesh Bank
During the year 2012, Bank’s Audit Team Inspection Team conducted inspection on our
conducted Audit & Inspection of all Branches/ Head Office & 26 Branches during the year
SME Agriculture Branches/Zonal Offices, 2012 on Foreign Trade and Foreign Currency
Wing/Division/Department of Head Office. Transactions. Major Core Risk areas including
Heads of 14 Zonal Offices also inspected others i.e. Consumer Financing, Small Enterprise
Branches. Incumbent/In-charges of Branches Financing functions were also inspected by the
also conducted their Self-Audit. Inspection Team.
b. Compliance Division: The Compliance
Division handles the Regulatory issues of Statutory Audit
Bangladesh Bank and other Regulatory In the 29th, Annual General Meeting held on May
Bodies and submits status of Regulatory 15, 2012, the Shareholders appointed M/S. A.
issues quarterly to the Audit Committee. Qasem & Co. Chartered Accountants and M/S.
The Compliance Division ensures that Bank ACNABIN, Chartered Accountants to audit the
complies with all Regulatory requirements Financial Statements and Nostro Accounts of the
while conducting its day-to-day business. They Bank for the year 2012.
maintain liaison with the Regulatory Bodies Statutory Auditors also covered 56 Branches and
for any Regulatory changes and notify the Head Office as part of the Annual Audit Program.
same to all concerned. The Division works for Auditors covered 80per cent of the Risk-Weighted
establishing compliance culture in the Bank. Assets.
c. Monitoring Division: Monitoring Division No partner or employees of the external audit firms
evaluates / assesses/ monitors the operational possess any share of the Bank they audit at least
performance of various branches based on during the tenure of their audit assignment of IBBL.
the relevant Data/Audit Reports and analyze Statutory Auditors also submitted a Management
those to assess the risk of branches and submit Report. This Report was discussed in the Meeting
report to the Management. They help the Audit of Audit Committee and sent to Bangladesh Bank
and Inspection Division to chalk out Risk Based as per requirement. The Audit Committee also
Audit and Inspection Program for the branches. monitors its compliance through Internal Control
The Monitoring Division also ensures internal and Compliance Wing.
check at the time of performing certain functional
areas through different tool like: DCFCL Risk Management
(Departmental Control Functions Checklist),
QOR (Quarterly Operation Report) and IDCL Identification of the Risks
(Investment Documentation Checklist) following
As per guidelines of Bangladesh Bank, The Risk

Commerce Minister Ghulam Muhammad Quader, MP is handing over ICMAB Award
Management Wing (RMW) has been established everyone in the Bank since the code spells out
in IBBL, which is responsible for identification and the expected standards of behaviour and sets the
management of risks faced by the Bank. The details operating principles to be followed. Every official
of our internal and external risk management ensures that the bank at all times maintains high
mechanism is included in a separate section titled ethical standards and adequate internal control
Risk Management of IBBL and steps have been measures are in place guarding against unethical
taken to manage risks. practices and irregularities.
Strategies adopted to Manage and Statement of Ethics and Values

Mitigate Risk
IBBL has adopted core values, commitments
Number of steps including conducting Stress Testing and code of conduct/ethical principles which are
have been introduced to manage and mitigate risk. A strictly followed. These are included in the earlier
broad detail is included in the separate section titled section of the report.
Risk Management of IBBL.
Communication of Statement of Ethics
Ethics and Compliance
The satement of ethics and business practices
The Bank pays close attention to the moral concerns is approved by the Board of Directors and is
in order to make the right ethical decisions on a circulated to all the directors and employees for
day to day basis over and above observing the law, their acknowledgement.
one of the basic professional requirements for the
Bank. IBBL belives that upholding of critical interest Board’s Statement on Ethics and
to the customers, employees, regulators alike to
Compliance
the Bank itself as secured, reliable and efficient
banking system is one of the pillars of economic The Board of Directors of IBBL is committed to
stability of any country. introduce high level of code of conduct and ethical
principles. It also monitors strict compliance of the
Enforcing a corporate code of ethics requires same.
understanding and active participation by

Effective Anti Corruption and Remuneration of Directors, Chairman,
Anti-Fraud Program Managing Director and Senior
IBBL follows anti fraud and anti corruption program Executives
as per the guidelines of regulatory authorities to Honorarium paid to the Directors and others for
prevent fraud and corruption. All tiers of employees attending meetings are as follows:
are trained on the issues.
For Board Meeting / Shari‘ah Supervisory
Committee Meeting Tk.5,000.00. For Executive
Whistle Blowing Policy Committee / Other Committee Meeting Tk.4,000.00
Our whistle blowing policy aims to promote As per Bangladesh bank BRPD Circular no. 09
tranperancy and serves as a channel of corporate dated 19th September 1996, IBBL has prodived
fraud risk management. The policy enables any only the following facilities to the Directors:
staff member, who has a legitimate concern on • The Chairman of the Board of Directors is
an existing or potential wrong-doing, done by any provided with a car, telephone, office chamber
person within the Bank. Central Complaint cell has and private secretary
been established and a vigilance team has also
• In addition to the above Directors are
been formed to protect fraud and error. Effective
entitled to fees and other benefits for
protection of whistle blowers is ensured. Risk
attending the Board, Executive Committee,
Management Unit (RMU) acts as the whistleblower
Audit Committee and Shari‘ah Supervisory
at IBBL.
Committee meetings
• Managing Director is paid salaries and
Remuneration Committee
allowances as per approval of the Board
Committee Charter and Bangladesh Bank which is separately
disclosed in the Financial Statements.
Since it is not permitted as per Bangladesh
Bank guidelines, separate committee of Board • The senior management is remunerated as
on Remuneration has not been formed in IBBL. per standard pay structure of the bank being
But the Board of Directors time to time evaluates approved by the Board.
the remuneration paid to all level of employees, The Bank has fully complied with Bangladesh
directors and others and decides on the issue. Bank circular and instruction in this regard.
Composition Human Capital

The remuneration is decided by the Board
Islami bank Bangladesh Limited views its
of Directors where all the members are non-
employees as the most valuable capital of the
execuitive diretors. The Managing Director, Deputy
organization with the potential to bring superior
Managing Directors, Head of Human Resources,
results.
CFO and other related officials work on the issue
as per guidance of the Board.
Human Resources Development and
Policies on Remuneration Management
Key policies to decide on remuneration include In order to keep pace with the additional human
market trend, inflation, job requirement, position in resources requirement and to enhance the
other banks in the same area etc. employment opportunity in the country, periodic
recruitment is done as per need of the Bank.
In the year 2012, total 1,152 employees were
Meetings on Remuneration Issues recruited and after this recruitment total number
Several meetings of the executives and related of employees of the Bank increased to 12,188
Board members were held to finalize some including 407 female officials as on 31st December
benefits paid to the employees during the year 2012 against 11,465 including 216 female officials
2012. as on 31st December 2011.

Dr. Akbar Ali Khan, former Advisor to the Caretaker Government, is addressing an Executive Development Program
IBBL’s Human Resources Management always Merit Based Recruitment

believes to look at the man behind the machine
because only an educated, talented and skilled To acieve the long cherished objectives by
employee can ensure the highest yield from the following the principle of merit based recruitment
machine and hence the Bank always strives to with this end in view, IBBL has formulated its
develop skills and competencies at all levels of Policy Mannual for Recruitment and Development
the employees. of Human Resources. This policy is duly approved
by the Board which is being followed meticulously
Succession Planning to ensure right manpower for right position.
The bank is well aware of the necessity to operate
the business efficienctly and to maintain continuity. Performance Appraisal System
IBBL has taken initiatives to develop succession
IBBL follows a well-structured performance
planning for its senior management positions as
it recognizes that with a good succession plan, apprials system for evaluating the performance
it can uphold its traditions, promote image, build of the employees. Standard appraisal system
new values and ensure that the bank is prepared ensures justice to all the employees of the bank.
for future challenges.
Manpower Position and Some Other Related Information

Category 2012 2011 2010 2009 2008
Executive 387 347 316 284 262
Officer 7294 6782 6092 5646 5341
Sub-Staff 1953 1845 1627 1542 1483
Sub total 9634 8974 8035 7472 7086
Rural Development Scheme (RDS) 2191 2024 1837 1732 1928
Others (Temporary) 363 467 477 384 383
Total Manpower 12188 11465 10349 9588 9397
Total Branch 276 266 251 231 206
Per Branch Employee (including RDS & others) 44 43 41 42 46
Per Branch Employee (Excluding RDS & others) 36 34 32 32 34

Orientation Program for Probationary Officers
Promotion, Reward & Motivation Bank’s Contribution towards the Staff

IBBL follows structured human resources manual IBBL is committed to treating all employees with
for providing promotion, reward and motivation dignity and respect. The bank strives to maintain
towards staff. During the year 2012, IBBL offered a comfortable working environment, irrespective
promotion and reward that attained distinction in of individual differences. A high quality and
dispersing challenges jobs.
competent human resource is crucial to continue
growth and success of any business entity, which
Training and Development can be achieved by improving skill, knowledge and
IBBL always strives for excellence in improving the productivity of employees. Customers’ perception
ethical and professional standard of the officials and satisfaction ultimately determines relative or
of the bank and reviewed the issue from time to absolute success or failure of an organization. In
time. IBBL organized continuous training to its turn, we need a competent, well-trained, committed
employes throughout the year in its own training and motivated team of human resources with
institutue. In addition, employees of the bank also positive and sincere attitude towards customers
particitaed different training program organized by that can develop, maintain and strengthen trust
different institutes at home and abroad. and confidence in our customers that is crucial for
our success.
Grievance Management and Counseling
All employees have the right to complain both Human Resource Accounting
internally and externally and the HR department Human Resource Accounting involves accounting
ensures full confidentiality of those complaints.
for the Bank’s management and employees as
For customers, a Complaint Handling Procedure
“human assets” or “human capital” that provide
has been developed and implemented by Service
future benefits. Towards implementing Human
Quality Department in handling complaints. In
addition, a 24 hour hotline number is available Resource Accounting standard IBBL adopts
to lodge any irregularities at any time, which transparent disclosure practices regarding its
are accordingly redirected to the respective human resources.
departments and HR for resolution.

Orientation Program for Assistant Officers
The Bank calculates some items related to human and well-being of the countrymen as well as
resources accounting mentioned below which are of its employees. A lot of programs aiming to
considered with due importance in the decision employee-welfare, Healthcare, Safety Standards
making process. & Working Environment covering the followings
are there in IBBL:
Employee Productivity • Non-refundable financial help from
(In million taka) Employees’ Benevolent Fund
Sl. Particulars 2012 2011 • Non-refundable financial grant from bank’s

No.
fund
1 Total deposit per employee 54.21 47.91
2 Total investment per employee 50.94 45.28 • Awarding of prize against essay competition
3 Total income per employee 6.42 5.26
• Staff House Building investment facilities
4 Total expenses per employee 4.46 3.54
5 Profit before provision per 1.96 1.73 • Staff Household Durables Scheme
employee
6 Profit before taxes per 1.58 1.45 • ‘Quard’ against Provident Fund
employee
7 Salary and allowances per 0.72 0.61
• ‘Quard’ against Benevolent Fund
employee
• Burial expenses
8 Salary and allowances as 37% 35%
percentage of operating profit • Recreation program
before provision
The figures are for mainstream only • Honorarium for passing Banking Diploma
examination
Healthcare, Safety Standards and • Awarding of cash, crest & certificate of merit
Modern Working Environment to the meritorious university students
IBBL is the pioneer of welfare banking which • Awarding of scholarships to help educate the
constantly endeavors to bring about a sort meritorious wards of the employees
of radical change in the level of prosperity

Trainning Course on Islamic banking for Agrani Bank Offcials
• Awarding of cash prize and certificate of merit disclosures in annual report in the broad areas
to the meritorious wards of bank employees of Profile Disclosure, Management Approach,
Performance Indicators and Labor Practices as
• Medical allowance is paid to each employee,
stipulated in the Content Index of Financial Service
which is tax-free.
Sector Supplement. IBBL complies with most of
• In order to provide highly sophisticated the disclosure requirements as stated in the Index.
and encouraging working environment, all
the IBBL offices including head office and
branches are equipped with modern facilities
Communication to Shareholders
with air-conditioning and generator for power & Stakeholders
back up.
Policy on Communication with
• All IBBL offices including head office and Shareholders and Stakeholders
branches are equipped with fire fighting
material and have multiple exit points for IBBL follows specific policy to facilitate effective
emergency exit. communication with the shareholders and
stakeholders. IBBL has a separate Department
Corporate Structure named Share Department to keep communication
with the shareholders, Bondholders and other
Corporate Structure of IBBL is shown at page no. 36 related stakeholders. Shareholders and others
may contact at any time to this Department for
Global Reporting Initiative (GRI) any sort of information and query. IBBL provides
updated information in its website for all the stake
The Global Reporting Initiative (GRI) is a non-
holders of the bank
profit organization that promotes economic,
environmental and social sustainability. GRI
provides all companies and organizations with a Policy on Ensuring Participation of
comprehensive sustainability reporting framework Shareholders at AGM
that is widely used around the world. In line with To make the AGM more participatory, IBBL declares
the above, Islami Bank Bangladesh Limited. has date of AGM well ahead of time, circulate Annual
started to incorporate the components of standard

29th Annual General Meeting
Reports and other documents in time, arrange Investors Friendly Information

AGM in a well-known place and convenient time,
allows shareholders to speak in the AGM freely Investment in IBBL’s share is very reliable due to
and value their proposals and suggestions. comfortable capital adequacy, good asset quality,
excellent financial performance, comfortable
liquidity, strong market position and experienced
Environmental and Social top Management. Besides, return on IBBL’s share
is excellent. IBBL ranked 17th position among the
Obligations top 1000 banks around the globe in trems of profit
on capital.
Policies on Social and Environmental
Responsibility IBBL ranks top to the Foreign Investors. The Bank
has also reputation for Shari‘ah based banking
Freshly, the issue of climatic change is being management. There is very little fluctuation in the
addressed seriously all over the world. It is Islami Bank share price. There is no rumour in
identified that Bangladesh being a southern the Islami Bank share. Therefore, Investors rely
delta is under serious threat of natural disaster. greatly on this share. Goldman Sachs, the leading
A detailed discussion regarding environment wealth management institution of the world, has
and social obligation of IBBL is included in the chosen share of IBBL in their portfolio GSN-11 as
Corporate Social Responsibilities report. the best in Bangladesh. Therefore, the company
has invested a good amount of their investible
Specific Policies undertaken by fund in IBBL shares.
the Bank In addition, the leading wealth management
IBBL, being a responsible bank, has taken some institutions of the world have chosen share of
initiatives in this regard such as IBBL in their portfolio. 28 Foreign Companies have
purchased 6.34 per cent shares of total Paid-up
a. Measures taken within the organization
Capital of the Bank through Standard Chartered
b. Measures taken with the customers Bank. Among them JP Morgan Chase Bank of
c. Measures taken with the community. Luxembourg has already purchased 2.71 per cent
shares of total Paid-up Capital of the Bank solely.

Glimpses of 29th AGM

Management Review & Responsibility becomes due without compromising the earning
potential of the Bank. In every ALCO meeting, the
Managing Director is the Chief Executive committee reviews actions taken in previous ALCO
Officer (CEO) of the Bank. Bank has approved meeting, economic and market status and outlook,
Organizational Structure (Organogram) with liquidity risk related to balance sheet, profit rate
clear functional separation and segregation of structure etc. Special ALCO meeting is arranged
processing/functioning (Front and Back office) as and when any contingent situation arises.
authorities. This ensures Core Risk Management
practice and compliance across the Bank.
Bank’s functions and plans also consider various
The Shari‘ah Supervisory Committee
regulatory limits and restrictions to be risk As per Islamic Banking Guidelines, issued by
compliant. Bangladesh Bank, the Shari‘ah Supervisory
Committee has been formed consisting of 12
Management Committee is the main body of
members including Shari‘ah scholars, renowned
management and decision making in the bank.
lawyers and eminent economists. The Shari‘ah
Besides, there are ALCO and Risk Management
Supervisory Committee of IBBL gives opinions
wing (RMW) for designated functions and
and guidelines to implement and comply with
responsibilities. Each of these forums has specific
the Shari‘ah principles in all activities of the Bank
Terms of Reference approved by the Board.
particularly in the modes of investment. The
Above all, the bank is governed by the rules, Committee is governed by a bye-laws approved
regulations, guidelines, directions and policies by the Board of Directors.
as applicable for the banking business and
The representatives of the Committee attend
operations.
different meetings of the Bank, like Board of
Directors, Executive Committee, Audit Committee,
The Management Committee and Annual Business Development Meetings and
Management Committee of the bank comprises 12 Conferences to give opinions and oversee the
(twelve) top-level executives, having over 25 years activities of the Bank from Shariàh perspective.
experiances and sound knowledge in Islamic The Committee also evaluates performance of the
banking. It is headed by the Managing Director officials in terms of their Shariàh compliance.
CEO of the Bank. The Committee exerts financial,
administrative and business discretionary powers Shari‘ah Supervisory Committee &
delegated by the Board and is also responsible Sub-committee Meeting
for implementation of the policies and guidelines
approved by the Board. The Management In the year 2012, 4 (four) meetings of Shari‘ah
Committee scrutinizes the issues thoroughly Supervisory Committee and 18 (eighteen)
before placing these to the Executive Committee/ meetings of Shari‘ah Sub-Committee were held.
Board. The Management Committee evaluates Members of Shari‘ah Supervisory Committee
the performance of the Bank critically, adopts attended 26 (twenty six) seminars as discussant
strategic action plan to achieve various targets of on the occasion of opening new Branches and
the bank set by the Board of Directors. Agriculture Branches and participated in Business
Development Meetings arranged by several
Zones and Head Office.
Asset-Liability Committee (ALCO)
The Asset-Liability Committee (ALCO) of the Bank Shari‘ah Inspection
is comprised of 10 (ten) members from the top
management which meet at least once in a month As part of major responsibilities of the Committee
to review the liquidity position of the bank, maturity it also conducted Shari‘ah inspections in 266
wise grouping of assets and liabilities, deposits branches including 30 SME/Agriculture Branches
and investment pricing and liquidity contingency through Muraqibs during 2012 to ensure that the
plan in order to manage the Balance Sheet Risk Shari‘ah principles are implemented and complied
in a better way. The ALCO is entrusted with the with, or, on the contrary, to detect if there is any
responsibility of ensuring the Bank’s adequate deviation or lapse that has taken place in the
liquidity at all times to meet its obligations when Branches of the Bank.

Regulatory Compliance IBBL obtained the “AA+” rating in the long term
has been determined on the basis of good
Bank has been following related guidelines fundamentals such as:
including submission of Quarterly, Half-yearly and
• Comfortable capital adequacy
Yearly financial statements and other statutory
reports. • Good asset quality
• Good financial performance
Any significant development in the business is
• Comfortable liquidity
forth-with disclosed in the form of price sensitive
declarations adhering proper rules/guidelines/ • Strong market position
directives. Bank also ensures submission of • Considerable improvement in non-funded
returns to regulatory bodies in full-compliance business
of the requirements and appropriate disclosures • Experienced top management
ensuring transparency and accountability. • Wide operational network
Board of Directors ensures adequate disclosures • Carrier of Islamic Banking Flagship in
for the shareholders and other stakeholders. Bangladesh
• Significant rated corporate exposures
Delegation of Power
Board of Directors’ Responsibility
Management Committee of the Bank has been
in Respect of Audited Financial
empowered with appropriate administrative
finance and business decision-making authorities
Statements
as per the guidelines of Bangladesh Bank whereas The Board of Directors ensure that financial
the Board of Directors and its committees are statements give a true and fair view of the Bank’s
entrusted with formulation of standard policies state of affairs, results, changes in equity and
and procedures. Management Committee of the cash flows of 2012. In preparing the financial
Bank has been delegated with the authority of statements, the bank uses appropriate accounting
approving Investment up to a given limit. Board policies, supported by reasonable as well as
has approved the procurement policies to cover prudent judgments and estimates to ensure that all
the purchase of goods and services and other applicable accounting standards have been followed
procurements of the Bank. at the time of preparing the financial statements.
Besides, various manuals, policies and guidelines

were approved by the Board from time to time Relationship of Board of Directors with
with levels of authority and process of delegation the Auditors
varied across the Bank. The Board has established transparent and
appropriate relationships with its external auditors
Credit Rating of the Bank through the Audit Committee. The external
auditors have an obligation to bring any significant
IBBL continuous to maintain highest rating among
lapses/irregularities in the Bank’s system of
the private sector banks of the country. The
internal control and compliance to the attention of
description of latest credit rating of the bank is
Management, Audit Committee and the Board.
delineated below:
Name of Long-term Short-term

the Rating Particulars AA+ (Double A+) ST-1 Remarks
Company (High Safety) (Highest Grade)
Credit Rating Surveillance Bank rated in this category is adjudged Highest certainty of timely Based on
Information Rating to be of high quality, offer higher safety payment. Short-term liquidity Audited Financial
and Services and have high credit quality. This level including internal fund generation Statements as of
Limited of rating indicates a corporate entity is very strong and access to 31 December 2011
(CRISL) with a sound credit profile and without alternative sources of funds is and is valid up to
significant problems. Risks are modest outstanding. Safety is almost risk June 30, 2012 for
and may vary slightly from time to time free like Government short-term long term
because of economic conditions obligations
Date of Declaration of Rating: June 22, 2012
Outlook: Stable

Relationship of Board of Directors with
the Shareholders and Investors
The Board recognizes the importance of timely and One of the most important means of communication
proper dissemination of information with regard to to the Shareholders is the Annual Report, which
the Bank’s performance and other issues affecting contains comprehensive and sufficient details
the interests of the shareholders, investors and about the financial results, performance and other
the general public. important activities of the Bank.
Directors’ Attendance in the Board Meeting, Executive Committee Meeting and Audit
Committee Meeting
Board Executive Committee Audit Committee

Sl.
Name of Directors Position Eligible to Eligible to Eligible to
No Attended Attended Attended
Attend Attend Attend
1 Jb. A.N.M.A. Zaher Chairman 20 20 - - - -
2 Jb. Yousif Abdullah Al-Rajhi Vice Chairman 20 2 - - - -
Jb. Kazi Harun-ar-Rashed (Alternate on Alternate Director 1 1 - - - -

behalf of Jb. Yousif Abdullah Al-Rajhi)
3 Engr. Mustafa Anwar Vice Chairman 20 19 - - - -
4 Engr. Md. Eskander Ali Khan Director & 20 20 50 50 - -

Chairman of EC
5 Jb. Md. Khurshed Hossain Director 3 3 - - - -
Jb. Md. Abul Hossain Director 17 17 25 25 - -
6 Dr. Abdulhameed Fuad Al-Khateeb Director 20 6 50 1 - -
7 Jb. Mohamad Adnan Midani Director 20 4 - - 22 -
8 Jb. Mohammad Abdullah AlJalahma Director 20 7 - - - -
9 Jb. Hafizul Islam Mian Director 8 7 25 23 - -
10 Jb. Md. Shahidul Islam Director 8 7 - - 14 14
11 Engr. Muhammad Dawood Khan Director 6 6 25 24 - -
12 Jb. Mohammed Nazrul Islam Director 8 8 25 23 - -
13 Jb. Md. Abdus Salam, FCA, FCS Depositor Director 20 14 25 24 22 20
14 Jb. Humayun Bokhteyar, ACPA, FCA Depositor Director 20 17 50 47 8 7
15 Professor NRM Borhan Uddin Ph.D Independent 20 20 - - 22 21

Director &
Chairman of AC
16 Jb. Salahuddin Ahmed Director 15 4 - - - -
17 Jb. Mominul Islam Patwary Director 8 8 25 24 - -
18 Jb. Abdullah Abdul Aziz Al-Rajhi Director 15 - - - - -
Prof. Dr. A.K.M. Sadrul Islam (Alternate on Alternate Director 1 1 - - - -

behalf of Jb. Abdullah Abdul Aziz Al-Rajhi)
19 Prof. Dr. A.K.M. Sadrul Islam Independent - - - - - -
Director
20 Barrister Mohammed Belayet Hossain Independent - - - - - -
Director

Statement of Shares held by Directors & their Spouses and Minor Children as on
31.12.2012
Sl. No. of
Name of Directors Status
No. Shares
1 2 3 4
The Ibn Sina Trust Chairman 28,459,512
Repr. by Prof. Abu Nasser Muhammad Abduz Zaher
01. Prof. Abu Nasser Muhammad Abduz Zaher Self 55,800
Mrs. Hamida Khatun Wife of Prof. Abu Nasser 101,762
Muhammad Abduz Zaher
Abdullah Abdul Aziz Al-Rajhi, K.S.A. Director
02. Yousif Abdullah Al-Rajhi, K.S.A. Vice-Chairman 94,877,137

S/O- Abdullah Abdul Aziz Al-Rajhi holding of 7.58% shares of the total
Paid-up Capital of the Bank.
03. Yousif Abdullah Al-Rajhi, , K.S.A. Self 77,650
The Public Institution for Social Security, Kuwait Vice-Chairman 80,843,000
04. Repr. by Engr. Mustafa Anwar
Engr. Mustafa Anwar Self 2,957,912
Al-Rajhi Co. for Industry & Trade, K.S.A. Director 124,305,850
Repr. by Engr. Md. Eskander Ali Khan
05.
Engr. Md. Eskander Ali Khan Self 1,241,287
Shahanara Begum & Engr. Md. Eskander Ali Khan Joint Account 26,325
Kuwait Awaqaf Public Foundation, Kuwait Director 53,884,100
06.
Repr. by Mohammad Abdullah Al Jalahma
Islamic Development Bank, K.S.A. Director 93,852,825
07.
Repr. by Mohamad Adnan Midani
08. Investment Corporation of Bangladesh Director 33,792,662
Repr. by Md. Abul Hossain
Arabsas Travel & Tourist Agency, K.S.A. Director 125,094,537
Repr. by Dr. Abdulhameed Fouad Al-Khateeb
Dr. Abdulhameed Fouad Al-Khateeb Self 7,143,925
09. Linah Mahmoud H. Naseef Wife of Dr. Abdulhameed 2,225
Fouad Al-Khateeb
Mrs. Mona Barakeh Wife of Dr. Abdulhameed 1,725
Fouad Al-Khateeb
Kuwait Finance House, Kuwait Director 65,706,125
10.
Repr. by Salahuddin Ahmed
Islamic Education Society Director 30,525
11.
Repr. by Hafizul Islam Mian
Md. Shahidul Islam Director 2,097,050
12.
Mrs. Mahfuza Khatun Wife of Md. Shahidul Islam 666,887
Mohammed Nazrul Islam Director 268,512
13. Mrs. Salina Begum Wife of Mohammed Nazrul 229,175
Islam
Mominul Islam Patwary Director 48,700
14. Mrs. Maleka Parveen Wife of Mominul Islam 41,425
Patwary
15. Md. Abdus Salam, FCA, FCS Depositor Director 0
16. Humayun Bokhteyar, ACPA, FCA Depositor Director 0
17. Professor NRM Borhan Uddin, Ph.D Independent Director 0
Prof. Dr. A.K.M. Sadrul Islam Independent Director 5,787
18. Mrs. Nazmun Nahar Islam Wife of Prof. Dr. A.K.M. 67,375
Sadrul Islam
19. Barrister Mohammed Belayet Hossain Independent Director 0
Mohammad Abdul Mannan Managing Director & CEO 240,675
20. Mrs. Maksuda Begum Wife of Mohammad Abdul 50,087
Mannan

Statement of Shares held by CEO, Company Secretary, CFO, Head of Internal Audit and
their Spouses and Minor Children as on 31.12.2012
Sl. No. of
Name Status
No. Shares
Mohammad Abdul Mannan Managing Director & Chief Executive Officer (CEO) 240,675
01.
Mrs. Maksuda Begum W/O. Mohammad Abdul Mannan, 50,087
Managing Director & CEO
Abu Reza Md. Yeahia Senior Vice President & Company Secretary 2,800
02. Mrs. Shahinoor Akther W/O. Abu Reza Md. Yeahia, 1,512
Senior Vice President & Company Secretary
Md. Habibur Rahman Bhuiyan, FCA Deputy Managing Director & Head of Internal Control & 13,987
Compliance Wing (ICCW)
03. Mrs. Tahmina Rahman W/O. Md. Habibur Rahman Bhuiyan, 7,225
Deputy Managing Director & Head of Internal Control &
Compliance Wing (ICCW)
Mohammad Nesar Uddin, FCA, FCMA Executive Vice President & Chief Financial Officer (CFO) 25
04. Mrs. Majeda Akter W/O. Mohammad Nesar Uddin, FCA, FCMA, 1,337
Executive Vice President & CFO
Statement of Shares held by top 5 (five) Salaried Employees other than the Directors,
CEO, Company Secretary, CFO, Head of Internal Audit (ICCW) as on 31.12.2012
Sl. No. of
Name Designation
No. Shares
01. Md. Habibur Rahman Deputy Managing Director, CIW 42,875
02. Md. Nurul Islam Deputy Managing Director, DW 725
03. Mohammad Abul Bashar Deputy Managing Director, ICTW 23,100
04. Syed Abdullah Mohammed Saleh Deputy Managing Director, RIW 87
05. A.K.M. Abdul Malek Chowdhury Deputy Managing Director, RMW 775

28 March, 2013
The Board of Directors

Islami Bank Bangladesh Bank
Islami Bank Tower
40, Dilkusha C/A
Dhaka-1000
Sub: CEO/CFO’s Declaration to the Board
In accordance with the notification of Bangladesh Securities and Exchange Commission

No. SEC/CMRRCD/2006-158/134/Admin/44 dated 07, August, 2012, we declare that for
the financial year ended 31 December, 2012:
i) We have reviewed the financial statements for the year and that to the best of our
knowledge and belief:
a) These statements do not contain any materially untrue statement or do not omit
any material fact or contain statements that might be misleading;
b) These financial statements together present a true and fair view of the company’s
affairs and are in compliance with existing accounting standards and applicable
laws;
ii) There are, to the best our knowledge and belief, no transactions carried out or recorded
into by the Bank during the year are fraudulent, illegal or violating Bank’s code of
conduct.
Mohammad Abdul Mannan Mohammad Nesar Uddin FCA, FCMA

Managing Director Chief Financial Officer

Compliance Status of BSEC Guidelines for Corporate Governance
Status of Compliance by IBBL with the Corporate Governance (CG) Guidelines issued by BSEC through
Notification No. SEC/CMRRCD/2006-158/134/Admin/44 dated 07 August 2012:
Compliance Status
Condition
Title Not Remarks
No. Complied
Complied
1 2 3 4 5
1 Board of Directors
1.1 Board’s size: Board members shall not be less than 5 (five) and more √
than 20 (twenty)
1.2 Independent Director

1.2(i) At least one fifth (1/5) of the total number of directors in the company’s *√
board shall be independent directors.
1.2(ii) For the purpose of this clause “Independent Director” means a Director:
1.2(ii)a) Independent Directors do not hold any share or holds less than one √
percent (1%) shares of the total paid-up capital.
1.2(ii)b) Independent Directors are not connected with the company’s Sponsor √
or Director or shareholder who holds one percent (1%) or more shares.
1.2(ii)c) Independent Directors do not have any other relationship, whether √

pecuniary or otherwise, with the company or its subsidiary/associated
companies;
1.2(ii)d) Independent Directors are not members, directors or officers of any √
stock exchange;
1.2(ii)e) Independent Directors are not Shareholder, Directors or Officers of any √
member of stock exchange or an intermediary of the capital market;
1.2(ii)f) Independent Directors are not the partners or executives during the √
preceding 3 (three) years of the concerned company’s statutory audit
firm;
1.2(ii)g) They are not the Independent Directors in more than 3 (three) listed √
companies;
1.2(ii)h) They have not been convicted by a court of competent jurisdiction as √
a defaulter in payment of any loan to a bank or a Non-Bank Financial
Institution (NBFI);
1.2(ii)h(i) They have not been convicted for a criminal offence involving moral √
turpitude.
1.2(ii)h(iii) The independent director(s) shall be appointed by the board of Directors √
and approved by the shareholders in the Annual General Meeting
(AGM).
1.2(ii)h(iv) The post of independent Director(s) cannot remain vacant for more than √
90 (ninety) days.
1.2(ii)h(v) The Board shall lay down a code of conduct of all Board members and √
annual compliance of the code to be recorded.
1.2(ii)h(vi) The tenure of office of an independent Director shall be for 3 (three) √
years, which may be extended for 1 (one) term only.
1.3 Qualification of Independent Director (ID)
1.3(i) Independent Director shall be knowledgeable individual with integrity √
1.3(ii) The Independent Director must have at least 12 (twelve) years of √
corporate management/professional experiences.
1.3(iii) In special cases the above qualifications may be relaxed subject to N/A
approval of the Commission.
*3 (three) Independent Directors as 1/5th of 14 elected directors (excluding independent and depositors directors) have been appointed. However, 1
(One) more Independent Director will be appointed at the earliest as required considering 1/5th of the total number of directors.

Compliance Status
Condition
Title Not Remarks
No. Complied
Complied
1 2 3 4 5
1.4 Separate Chairman and CEO and their clearly defined roles and √
responsibilities.
1.5 Directors’ Report to Shareholders
1.5(i) Industry outlook and possible future developments in the industry. √

1.5(ii) Segment-wise or product-wise performance. √
1.5(iii) Risks and concerns √
1.5(iv) A discussion on Cost of Goods sold, Gross Profit Margin and Net Profit √
Margin.
1.5(v) Discussion on continuity of any Extra-ordinary gain or loss. √ IBBL does
not have such
gains or loss
1.5(vi) Basis for related party transactions- a statement of all related party √ There were
transactions should be disclosed in the annual report. no such case
in 2012
1.5(vii) Utilization of proceeds from public issues, rights issues and/or through √
any others instruments.
1.5(viii) An explanation if the financial results deteriorate after the company N/A
goes for Initial Public Offering (IPO), Repeat Public Offering (RPO),
Rights Offer, Direct Listing, etc.
1.5(ix) If significant variance occurs between Quarterly Financial performance N/A
and Annual Financial Statements the management shall explain about
the variance on their Annual Report.
1.5(x) Remuneration to directors including independent directors. √
1.5(xi) The financial statements prepared by the management of the issuer √
company present fairly its state of affairs, the result of its operations,
cash flows and changes in equity.
1.5(xii) Proper books of account of the issuer company have been maintained. √
1.5(xiii) Appropriate accounting policies have been consistently applied in √
preparation of the financial statements and that the accounting estimates
are based on reasonable and prudent judgment.
1.5(xiv) International Accounting Standards (IAS)/Bangladesh Accounting √
Standards (BAS)/International Financial Reporting Standards (IFRS)/
Bangladesh Financial Reporting Standards (BFRS), as applicable
in Bangladesh, have been followed in preparation of the financial
statements and any departure there-from has been adequately
disclosed.
1.5(xv) The system of internal control is sound in design and has been effectively √
implemented and monitored.
1.5(xvi) There are no significant doubts upon the issuer company’s ability to √
continue as a going concern. If the issuer company is not considered
to be a going concern, the fact along with reasons thereof should be
disclosed.
1.5(xvii) Significant deviations from the last year’s operating results of the N/A
issuer company shall be highlighted and the reasons thereof should be
explained.
1.5(xviii) Key operating and financial data of at least preceding 5 (five) years shall √
be summarized.
1.5(xix) If the issuer company has not declared dividend (cash or stock) for the N/A
year, the reasons thereof shall be given.

Compliance Status
Condition
Title Not Remarks
No. Complied
Complied
1 2 3 4 5
1.5(xx) The number of Board meetings held during the year and attendance by √
each director shall be disclosed.
1.5(xxi) The pattern of shareholding shall be reported to disclose the aggregate number of shares (along with
name wise details where stated below) held by:-
1.5(xxi)a) Parent/Subsidiary/Associated Companies and other related parties √
(name wise details);
1.5(xxi)b) Directors, Chief Executive Officer, Company Secretary, Chief Financial √
Officer, Head of Internal Audit and their spouses and minor children
(name wise details);
1.5(xxi)c) Executives (top five salaried employees of the company other than √
stated in 1.5 (xxi)b);
1.5(xxi)d) Shareholders holding ten percent (10%) or more votes interest in the √
company (name wise details).
1.5(xxii) In case of the appointment/re-appointment of a Director the company shall disclose the following
information to the shareholders:
1.5(xxii)a A brief resume of the director; √
1.5(xxii)b Nature of his/her expertise in specific functional areas; √
1.5(xxii)c Names of companies in which the person also holds the directorship √
and the membership of committees of the Board.
2.00 Chief Financial Officer (CFO), Head of Internal Audit & Company Secretary
2.1 Appointment of CFO, Head of Internal Audit and Company Secretary √
and their clearly defined roles, responsibilities and duties.
2.2 Attendance of CFO and the Company Secretary at Board of Directors √
meeting.
3. Audit Committee
3. (i) The company shall have an Audit Committee as a sub-committee of the √
Board of Directors.
3. (ii) The Audit Committee shall assist the Board of Directors in ensuring that √
the financial statements reflect true and fair view of the state of affairs
of the company and in ensuring a good monitoring system within the
business.
3. (iii) The Audit Committee shall be responsible to the Board of Directors. The √
duties of the Audit Committee shall be clearly set forth in writing.
3.1 Constitution of the Audit Committee
3.1(i) The Audit Committee shall be composed of at least 3 (three) members. √
3.1(ii) Constitution of Audit Committee with Board Members including one √
independent director.
3.1(iii) All members of the audit committee should be “financially literate” √
and at least 1(one) member shall have accounting or related financial
management experience.
3.1(iv) Filling of Casual Vacancy in Committee N/A
3.1(v) The company secretary shall act as the secretary of the Committee. √
3.1(vi) The quorum of the Audit Committee meeting shall not constitute without √
at least 1 (one) independent director.
3.2 Chairman of the Audit Committee
3.2(i) Chairman of the Audit Committee shall be an independent director. √
3.2(ii) Chairman of the audit committee shall remain present in the Annual √
General Meeting (AGM).

Compliance Status
Condition
Title Not Remarks
No. Complied
Complied
1 2 3 4 5
3.3 Role of Audit Committee
3.3(i) Oversee the financial reporting process. √
3.3(ii) Monitor choice of accounting policies and principles. √
3.3(iii) Monitor Internal Control Risk management process. √
3.3(iv) Oversee hiring and performance of external auditors. √
3.3(v) Review along with the management, the annual financial statements √
before submission to the board for approval.
3.3(vi) Review along with the management, the quarterly and half yearly √
financial statements before submission to the board for approval.
3.3(vii) Review the adequacy of internal audit function. √
3.3(viii) Review statement of significant related party transactions submitted by √
the management.
3.3(ix) Review Management Letters/ Letter of Internal Control weakness issued √
by statutory auditors.
3.3(x) When money is raised through Initial Public Offering (IPO)/Repeat N/A
Public Offering (RPO)/Rights Issue the company shall disclose to the
Audit Committee about the uses/applications of funds by major category
(capital expenditure, sales and marketing expenses, working capital,
etc), on a quarterly basis, as a part of their quarterly declaration of
financial results.
3.4 Reporting of the Audit Committee
3.4.1 Reporting to the Board of Directors
3.4.1(i) The Audit Committee shall report on its activities to the Board of √
Directors.
3.4.1 (ii) The Audit Committee shall immediately report to the Board of Directors √
on the following findings, if any:
3.4.1(ii)a) Report on conflicts of interests; √
3.4.1(ii)b) Suspected or presumed fraud or irregularity or material defect in the √
internal control system;
3.4.1(ii)c) Suspected infringement of laws, including securities related laws, rules √
and regulations;
3.4.1(ii)d) any other matter which shall be disclosed to the Board of Directors √
immediately.
3.4.2 Reporting of anything having material financial impact to the Commission. √
3.5 Reporting to the Shareholders and General Investors √
4. External/Statutory Auditors
4.(i) Appraisal or valuation services or fairness opinions. √
4.(ii) Financial information systems design and implementation. √
4.(iii) Book-keeping or other services related to the accounting records or √

financial statements.
4.(iv) Broker-dealer services. √
4.(v) Actuarial services. √
4.(vi) Internal audit services. √
4.(vii) Any other service that the Audit Committee determines. √

Compliance Status
Condition
Title Not Remarks
No. Complied
Complied
1 2 3 4 5
4.(viii) No partner or employee of the external audit firms shall possess any √
share of the company they audit at least during the tenure of their audit
assignment of that company.
5. Subsidiary Company
5.(i) Provisions relating to the composition of the Board of Directors of the √
holding company shall be made applicable to the composition of the
Board of Directors of the subsidiary company.
5.(ii) At least 1 (one) independent director on the Board of Directors of the √

holding company shall be a director on the Board of Directors of the
subsidiary company.
5.(iii) The minutes of the Board meeting of the subsidiary company shall be √
placed for review at the following Board meeting of the holding company.
5.(iv) The minutes of the respective Board meeting of the holding company √
shall state that they have reviewed the affairs of the subsidiary company
as well.
5.(v) The Audit Committee of the holding company shall also review the √
financial statements, in particular the investments made by the
subsidiary company.
6. Duties of Chief Executive Officer (CEO) and Chief Financial Officer (CFO)
6.(i) They have reviewed financial statements for the year and that to the √
best of their knowledge and belief :-
6.(i)a) These statements do not contain any materially untrue statement √
or do not omit any material fact or contain statements that might be
misleading;
6.(i)b) These statements together present a true and fair view of the company’s √
affairs and are in compliance with existing accounting standards and
applicable laws.
6.(ii) There are, to the best of knowledge and belief, transactions entered into √
by the company during the year are not fraudulent, illegal or don’t of the
company’s code of conduct.
7. Reporting and Compliance of Corporate Governance
7 (i) The company shall obtain a certificate from a practicing Professional √
Accountant/Secretary (Chartered Accountant/Cost and Management
Accountant/Chartered Secretary) regarding compliance of conditions of
Corporate Governance Guidelines of the Commission and shall send
the same to the shareholders along with the Annual Report on a yearly
basis.
7 (ii) The directors of the company shall state, in accordance with the √
Annexure attached, in the directors’ report whether the company has
complied with these conditions.

Compliance Status of Bangladesh Bank’s Guidelines for Corporate
Governance
Sl. Compliance
Particulars
No. Status
1. Responsibilities and authorities of the board of directors:
a. Work-planning and Strategic Management: Complied
i. The Board shall determine the objectives and goals and to this end shall chalk out strategies
and works plan on annual basis. It shall specially engage itself in the affairs of making strategies
consistent with the determined objectives and goals and in the issues relating to structural
change and reorganization for enhancement of institutional efficiency and other relevant policy
matters. It shall analyze/monitor at quarterly basis the development of implementation of the
work-plans.
ii. The Board shall have its analytical review incorporated in the Annual Report on the success/ Complied
failure in achieving the business and other targets as set out in its annual work-plan and shall
apprise the shareholders of its opinions/recommendations on future plans and strategies. It shall
set the Key Performance Indicators (KPIs) for the CEO and other senior executives and have it
evaluated at times.
b. Lending and Risk Management: Complied
i. The policies, strategies, procedures etc. in respect of appraisal of loan / investment proposal,
sanction, disbursement, recovery, reschedulement and write-off thereof shall be made with the
board’s approval under the purview of the existing laws, rules and regulations. The Board shall
specifically distribute the power of sanction of loan/investment and such distribution should
desirably be made among the CEO and his subordinate executives as much as possible. No
director, however, shall interfere, directly or indirectly, in the process of loan approval.
ii. The Board shall frame policies for risk management and get them complied with and shall Complied
monitor at quarterly rests the compliance thereof.
c. Internal control management: Complied
The Board shall be vigilant on the internal control system of the bank to attain and maintain
satisfactory qualitative standard of its loan / investment portfolio. It shall review quarterly the reports
submitted by its audit committee regarding compliance of recommendations made in internal and
external audit reports and the Bangladesh Bank inspection reports.
d. Human Resources Management and Development: Complied
i. Policies relating to recruitment, promotion, transfer, disciplinary and punitive measures, human
resources development etc. and service rules shall be framed and approved by the Board. The
chairman or the directors shall in no way involve themselves or interfere in or influence over
any administrative affairs including recruitment, promotion, transfer and disciplinary measures as
executed under the set service rules. No member of the Board of Directors shall be included in the
selection committees for recruitment and promotion at different levels. Recruitment and promotion
to the immediate two tiers below the CEO shall, however, rest upon the board. Such recruitment
and promotion shall have to be carried out complying with the service rules i.e., policies for
recruitment and promotion.
ii. The Board shall focus its special attention to the development of skills of Bank’s complied Complied
staff in different fields of its business activities including prudent appraisal of loan / investment
proposals, and to the adoption of modern electronic and information technologies and the
introduction of effective Management Information System (MIS). The Board shall get these
programs incorporated in its annual work plan.
e. Financial Management: Complied

i. The annual budget and the statutory financial statements shall finally be prepared with the
approval of the Board. It shall at quarterly rests review /monitor the positions in respect of
Bank’s income, expenditure, liquidity, non-performing asset, capital base and adequacy,
maintenance of loan loss provision and steps taken for recovery of defaulted loans including
legal measures.
ii. The Board shall frame the policies and procedures for Bank’s purchase and procurement Complied
activities and shall accordingly approve the distribution of power for making such expenditures.
The maximum possible delegation of such power shall rest on the CEO and his subordinates.
The decision on matters relating to infrastructure development and purchase of land, building,
vehicles etc. for the purpose of the Bank’s business shall, however, be adopted with the
approval of the board.

Sl. Compliance
Particulars
No. Status
f. Formation of supporting Committees: Complied
For decision on urgent matters, an executive committee, whatever name called, may be formed with
the directors. There shall be no committee or sub-committee of the Board other than the executive
committee and the audit committee. No alternate director shall be included on these committees.
g. Appointment of CEO: Complied
The Board shall appoint a competent CEO for the bank with the approval of the Bangladesh Bank.
h. The Board shall ensure fulfilling any other responsibility (ies) appropriately assigned by the central Complied
bank (Bangladesh Bank)
2 Responsibilities of the Chairman of the Board of Directors: Complied
a. As the chairman of the board of directors (or chairman of any committee formed by the board or any
director) does not personally possess the jurisdiction to apply policymaking or executive authority,
he shall not participate in or interfere into the administrative or operational and routine affairs of the
bank.
b. The Chairman may conduct on-site inspection of any bank-branch or financing activities under Complied
the purview of the oversight responsibilities of the board. He may call for any information relating
to bank’s operation or ask for investigation into any such affairs; he may submit such information
or investigation report to the meeting of the Board or the executive committee and if deemed
necessary, with the approval of the Board, he shall effect necessary action thereon in accordance
with the set rules through the CEO. However, any complaint against the CEO shall have to be
apprised to Bangladesh Bank through the Board along with the statement of the CEO.
c. The Chairman may be offered an office-room, a personal secretary/assistant, a telephone at the Complied
office and a vehicle in the business-interest of the bank subject to the approval of the board.
3 Responsibilities of the Adviser: N/A
The adviser, whatever name called, shall advise the Board of Directors or the CEO on such issues only
for which he is engaged in terms of the conditions of his appointment. He shall neither have access to
the process of decision-making nor shall have the scope of effecting executive authority in any matters
of the bank including financial, administrative or operational affairs.
4 Responsibilities and authorities of the CEO:
The CEO of the bank, whatever name called, shall discharge the responsibilities and effect the authorities
as follows:
a. In terms of the financial, business and administrative authorities vested upon him by the Board, Complied
the CEO shall discharge his own responsibilities. He shall remain accountable for achievement of
financial and other business targets by means of business plan, efficient implementation thereof
and prudent administrative and financial management.
b. The CEO shall ensure compliance of the Bank Companies Act, 1991 and / or other relevant laws Complied
and regulations in discharge of routine functions of the bank.
c. The CEO shall report to Bangladesh Bank of issues violative of the Bank Companies act, 1991 or Complied
of other laws / regulations and, if required, may apprise the Board post facto.
d. The recruitment and promotion of all staff of the Bank except those in the two tiers below him shall Complied
rest on the CEO. He shall act in such cases in accordance with the approved service rules on
the basis of the human resources policy and sanctioned strength of employees as approved by
the board. The board or the chairman of any committee of the board or any director shall not get
involved or interfere in such affairs. The authority relating to transfer of and disciplinary measures
against the staff, except those at one tier below the CEO shall rest on him, which he shall apply in
accordance with the approved service rules. Besides, under the purview of the human resources
policy as approved by the board, he shall nominate officers for training etc.
5 Meetings of the Board of Directors: Complied

One Meeting of the board of Directors per month can be held usually but it can be more than one upon
necessity. No less than one meeting of the Board in three months is to be held.
6 Number of members of Executive Committee (EC) of the Board: Complied
Number of members of the EC cannot exceed 7 members as per BB BRPD Circular Letter No. 2 dated
15 February 2010 and more than one member from one family shall not be included on the EC as per BB
Circular Letter No. 4 dated 14 March 2010
7 Training of the Directors: Complied
The Directors of the Board will acquire appropriate knowledge of the Banking laws and other relevant
laws, rules and regulations to effectively discharge the responsibilities as a director of the bank.

Certificate on Compliance of Conditions of Corporate Governance
to the Shareholders of Islami Bank Bangladesh Limited
We, in respect of Islami Bank Bangladesh Limited (the Bank), have examined the status of
its compliance with conditions of Corporate Governance issued by Bangladesh Securities
& Exchange Commission (BSEC) vide its notification no. SEC/CMRRCD/2006-158/134/
Admin/44 dated 07 August 2012.
The compliance with the said conditions of Corporate Governance and reporting the status
thereof is the responsibility of the management of the Bank. Our responsibility is to provide
a certificate about whether the Bank is in compliance with the said conditions of Corporate
Governance based on our examination. Our examination for the purpose of issuing this
certificate was limited to the procedures including implementation thereof as adopted by
the Bank for ensuring the compliance of the conditions of Corporate Governance and
correct reporting of the status of the compliance on the attached statement on the basis of
evidence gathered and representation received. It is neither an audit nor an expression of
opinion on the financial statements of the Bank.
To the best of our information and according to the explanations given to us we certify that
Islami Bank Bangladesh Limited has, except condition no. 1.2(i) as reported by the bank
on the attached status of compliance statement, complied with the conditions of Corporate
Governance stipulated in the above mentioned BSEC’s notification dated 07 August 2012.
Mohammed Hamidul Islam, FCA Md. Moniruzzaman

Partner Partner
ICAB Enrollment Number: 912 ICAB Enrollment Number: 787
Dhaka, For A. Qasem & Co. For ACNABIN
28 March 2013 Chartered Accountants Chartered Accountants

Green Banking
Phase-wise Functions of Green Bank

O bserving uninterrupted global warming,
increasing trend of carbon emission, other
environmental pollutions and overall global Bangladesh Bank addressed the Green Banking
environment adversities and hence perceiving activities for the Banks in Bangladesh to be
the urgency to protect the globe from probable implemented in 3 (three) phases as under:
environmental calamities and to ensure continuous Islamic Bank Bangladesh Limited began green
supply of scarce natural resources for future banking operations at the end of November 2011
generation, a new approach to Green Banking as per BB circulated policy guidelines for Green
has been prescribed by Bangladesh Bank through Banking, vide BRPD Circular No. 02 dated 27,
“Policy Guidelines for Green Banking” vide BRPD February 2011.
Circular No. 02 dated 27 February, 2011. Getting
the comprehensive policy from the Central Bank,
Green Banking activities of IBBL has received a Achievement of Green Banking
new impetus. Green Banking practices of IBBL activities-2012
are mainly concentrated in its internal operations,
Investment, Corporate Social Responsibilities Green Banking Department
(CSR) activities and automation.
In accordance with the Bangladesh Bank’s policy
By nature and from Shari‘ah point of view, IBBL guidelines on Green Banking, the Green Banking
has tremendous responsibility for establishment Department was formed in an emergency board
of environment friendly banking for the greater meeting held on 24.09.2011 and is functioning under
interest of the hu-mankind and the earth. the supervision of the Bank’s Risk Management
Wing. Moreover, the Executive Committee (EC)
Moreover, being the largest private sector
looks after the Green Banking activities.
commercial bank and having the maximum
stakeholders, IBBL has ample scope for
promoting environment-friendly activities and Policy formulation and Governance
raising awareness among the masses to keep the IBBL has formulated the green banking policy to
globe habitable. accommodate the guidelines of Bangladesh Bank.
Phase-wise Functions of Green Bank

Phase-I (Jan to Dec- 2011) Phase-II (Jan to Dec- 2012) Phase-III (Jan to Dec 2013)
 Policy Formulation &  Sector Specific Environmental Designing and Introducing

Governance Policies Innovative Products.
 Incorporation of Environmental  Green Strategic Planning  To introduce environment friendly
Risk in CRM/ IRM  Setting up Green Branches innovative green products to address
 Initiating In-house Environment the core environmental challenges of
 Improved In-house Environment the country
Management Management
 Introducing Green finance  To avoid negative impacts on
 Formulation of Bank Specific environment through banking activities.
Creation of Climate Risk Fund Environmental Risk Management
Introducing Green Marketing Plan and Guidelines Reporting in Standard Format with
Online Banking External Verification
 Rigorous Programs to Educate
 Supporting Employee Training, Clients to be undertaken.  To publish independent Green Annual
 Consumer Awareness and Report following internationally
 Disclosure and Reporting of accepted format like Global Reporting
Green Events Green Banking Activities. Initiatives (GRI) targeting the
 Reporting Green Banking stakeholders duly verified by an
Practices independent agency or acceptable
third party.

Effluent Treatment Plant (ETP) of a project financed by the Bank
Green Office Guide, Green Instructions are also e. Auto Brick Manufacturing Units that emits less
circulated time to time for the smooth functioning carbon and requires 50% energy compared to
of green activities. Besides, sector-specific Green common brick projects.
Banking Policies are being formulated which will
f. CNG refueling & Conversion unit helps reduce
come into effect soon.
carbon at atmosphere.
Green Leader g. Besides, we have recycle plants for plastic,

iron & steel scrap recycling plants which help
We demonstrated our leadership in the area reduce environmental hazard.
of environmental sustainability by popularising
the concept of “green banking” in the country. Bio-Gas Plants
Bangladesh Bank designated us as one of the top
Green Banks in 2012. IBBL signed an MoU with Grameen Shakti on
installation of bio-gas plants in the rural areas.
Green Finance This initiative will help improve the livelihood of the
rural people and remove the gap between the rich
IBBL Green Energy has been designed to finance and the poor by reducing income inequality.
renewable energy sector i.e. solar energy,
ETP, bio-gas, agro SMEs and farmers. As on Green Products
December, 2012 IBBL made investment of Tk.
27,007.60 million to the concerns needing own IBBL has introduced various new green products
Effluent Treatment Plant. which ultimately reduce carbon emission.
i-banking, M-Cash, Online banking, SMS
Waste Management Investment Banking, Call Center and Phone Banking are
such products. It is allowing the customers to do
A Cloro-Alkali Plant producing Caustic Soda banking transaction without coming to the bank
invested by the Bank gives Chlorine (liquid) & physically. Expansion of ATM network is greatly
Hydrogen as byproducts which are hazardous reducing the carbon emission. A brief report on
for environment. To use this byproduct as raw Green Products is given below:
materials for producing other economic products,
the Bank invested further for additional plants. Digitalization of Document
Other environment friendly projects financed by Most of the documents of the Bank are converted
IBBL are: into softcopy. Books of Accounts are fully automated
a. Rice Bran Oil production. and made electronic. Lion’s share of the internal
and external communication are done through
b. Electricity production from Rice Husk authenticated e-mail. All kinds of Foreign Trade
c. Energy Saving Bulbs Services of the Bank are handled through Centralized
Trade Processing. Besides, all circulars, Memoranda
d. 100% export-oriented Jute yarn & bags
and queries are issued through Intranet.
manufacturing plant

Online Banking Climate Risk Fund
All branches of the Bank are under online network. IBBL has distributed Taka 52.00 million (for
Clients can now easily deposit, withdraw, remit fund flood Tk. 7.00 million and Disaster, Health &
and check account balances from 276 branches. Environment Tk. 45.00 million) in the year 2012
IBBl is contributing in online Banking through
(which was Tk. 48.05 million in 2011) among the
ATM banking. There are internet banking, mobile
climate victims due to devastating flood, chilling
banking and M-cash service. In 2012 a major
change and development brought in automation of cold, severe drought etc. in different parts of the
Banking. country.
Installation of IP Phone Detail position of Fael Khair Agro-

Inputs Program
IBBL has installed IP-Phone services in the Head
Office, Zonal Offices and at all AD Branches. As Sl. Particulars Amount/Person
a result, all high Executives, Divisional In-charges No.
and Branch Incumbents now easily communicate 1 Total Administrative Tk.156.00 million
without physical travel which help to reduce cost
carbon emission. 2 Administrative cost- Tk.40.00 million
2012
3 Number of 228 person
Marketing, Training & Capacity employees (2012) (Bank deputed SO
Building
& above 11 & 217
Foundation)
4 Number of 50,000 persons
Green Marketing beneficiaries (2012)
After introduction of SMS banking, green marketing

is gaining momentum. Employment notices Fael Khair Agro-Inputs Program
are given on website and online applications
Islami Bank Foundation (IBF) has been operating
are invited and entertained. Clients are also
encouraged to modify their products line, set up “Fael Khair Agro-Inputs Program (FKAIP), a profit/
modern machinery from environmental viewpoint. interest free quard program for the Sidr victims in
the southern part of Bangladesh since 2008 under
Green Banking Training an agency agreement with Islamic Development
Bank (IDB) with an amount of US$9.00 million
To promote and adopt the comprehensive idea
equivalent to BDT 616.00 million approximately.
on Green Banking activities, IBTRA arranged
Green Banking training programs in Dhaka and
different Zones in 2012. Besides, officials of the Exclusive Sponsorship of Dhaka City
Bank attended the training programs/workshops/ Beautification
seminars on Green Banking issues arranged by
Bangladesh Bank Training Academy and BIBM IBBL beautifies different parts of the city by
this year (2012). planting trees and orchid. IBBL also utilizes the
scope to spread the beauty of Bangladeshi nature,
Training Performance in the year 2012 culture, history and heritage etc. successfully on
different occasions.
1 Number of Course 23
Conducted Plantation
2 Participants of Employee 1144
training programs Every year IBBL plants a large number of trees
all over the country to rpotect the environment. In
3 Participants of customer Nil
awareness programs 2012 the Bank planted about 5,06,000 number of
various types of plants (forest, fruit and medicinal)
4 Expenditure Tk.4,21,850/-
which cost Tk. 11.43 million all over the country.

Islami Bank Call Centre Solar pannel at Islami Bank Tower
In-house Environmental Management Energy Management

IBBL has taken a number of initiatives in this The Bank encourages customers to adopt energy
regard. A Green office Guide is about to be shortly efficient practices in their businesses by providing
published to practise Green Management in the investments for such purposes.
office for which we can ensure more efficient
use of resources and reduction of waste, save Water Management
energy and money, and help improve our working
Our water consumption is mainly associated with
environment. Some initiatives of In-house
rest room, ablution and lunchroom facilities on
Environmental Management are given below:
bank premises. We are committed to improving
our water use and conservation practices. We
Waste Management encourage reducing use of water in our facilities
Waste minimization through demand and also encourage large borrowers to conserve
management, reuse and recycling are the and recycle water.
preferred methods of reducing solid waste.
However, where solid waste cannot be eliminated, Environmental Risk Assessment in CRM
we are committed to careful management and
IBBL has incorporated the environmental
disposal. In the processing of investment Proposal
scanning to assess investment risk of the clients
(trade/projects), the waste management system
and refrained from financing projects which would
of the industry is given weightage.
have direct adverse impact on water pollution,
health, encroachment of rivers and deforestation.
Other Green Banking Position
Sl. No. Particulars Green Travel
Solar panel installed in Head Office and 21
1
branches.
IBBL always encourages the officials for Green
travel for any business travel which reduce
Introduced measures for saving electricity, water,
2 environmental impact. In this regard, the Bank
Gas, Fuel and Introduced paper consumption.
Introduced use of scrap/one side used papers use hybrid autos, solar panels and uses public
3
for note pad. transport and car pooling system.
Installation/erection/set up of energy efficient
4 equipment/ machine (Generators, Energy bulbs
etc).
Ethical Banking
Introduced auto shutdown of electrical Banks have a direct impact on the community
5
equipment.
around them. That impact is two dimensional: the

Tree Plantation in Dhaka City
way they operate i.e. internal operations and the to determine the project’s environmental, social
types of companies they finance. IBBL takes care of and ethical risks. The Bank adopts processes to
both the dimensions in its operation. assess the environmental and social risks and
opportunities arising from its client’s business
Many ethical issues such as the environmental
activities and manages the Bank’s exposure to
conduct of business customers are now part of
them. The sustainability system ensures that
standard risk assessment and prudent banking.
sustainability considerations play a core role in the
IBBL has been trying to follow the Equator
Principles, a set of guidelines developed for Bank’s decision-making process for investment
managing social and environmental issues assessment.
related to the financing of development projects. From an operational perspective and driven by the
Our investment is based on Islamic values as desire to reduce its own impact on the environment,
defined by the principles of Shari‘ah (Islamic IBBL will shortly introduce performance evaluation
law). The Islamic Shari‘ah attempts to maximize and measurement of sustainability criteria within
social welfare. Consequently, Islamic investment the function of the Bank.
involves the screening out of those companies
whose primary business does not conform to the The Bank’s Green Pledge serves as the
Shari‘ah principles. fundamental base for impact reduction and
catalyses for behavioral change both within and
Management approach to Green Banking outside the organization. The basic principles of
the Green Pledge have been communicated to
The Bank has been actively supportive of employees, customers, suppliers and the wider
sustainable green finance and has continued to social circles within which the Bank operates.
increase its visibility and exposure to the sector.
Prospects for business from alternative and From the above details of performance, it is
sustainable finance in the green sector remain evident that our achievements in the field of
positive, especially given the strong growth Green Banking activities are significant, although
expectations for Bangladesh. In line with these we had shortage of experienced workforce,
expectations the Bank has actively sought to required resources, and necessary tools. We
enlarge its portfolio of green investments. have still a wide area for improving Green
Banking activities as desired by the Central
During the process of investment evaluation
Bank. Our efforts at enriching and expanding
of all potential projects, the Bank engages in a
systematic assessment of environmental risk green banking activities continue unabated.

Performance Review
Inauguration of Araaihazar Branch
T he Bank through its 276 branches (including

30 SME/Agriculture Branches) successfully
mobilized Tk.417,844 million Deposit from
direction of doubling its deposit base in every 5
(five) years.
7,031,297 Depositors and deployed Tk.372,921 Account Opening Status from 2008 to 2012
million as general Investment into 710,741
accounts up to 31st December 2012. In the year ϴ͕ϬϬϬ͕ϬϬϬ
2012, total income of the Bank was Tk.50,346 ϳ͕ϬϬϬ͕ϬϬϬ

ϳ͕Ϭϯϭ͕Ϯϵϳ
ϲ͕ϬϬϬ͕ϬϬϬ
million showing 31% growth in 2012 as against
ϲ͕ϬϬϰ͕ϳϯϭ
ϱ͕ϬϬϬ͕ϬϬϬ
27% growth in 2011 and total Expenditure was Tk.
ϰ͕ϵϯϵ͕ϱϬϮ
ϰ͕ϬϬϬ͕ϬϬϬ
ϰ͕ϱϵϭ͕ϰϲϯ
34,738 million showing 35% increase in 2012 as

ϰ͕ϯϲϭ͕ϴϵϲ
ϯ͕ϬϬϬ͕ϬϬϬ
against 25% increase in 2011 resulting in pre-tax Ϯ͕ϬϬϬ͕ϬϬϬ
profit of Tk.12,096 million showing 17% growth in ϭ͕ϬϬϬ͕ϬϬϬ

Ϭ
2012 as against 22% growth in 2011. The Board ϮϬϬϴ ϮϬϬϵ ϮϬϭϬ ϮϬϭϭ ϮϬϭϮ
of Directors of the Bank recommended 25% (8% EŽ͘ŽĨĞƉŽƐŝƚŽƌƐ ϰ͕ϯϲϭ͕ϴϵϲ ϰ͕ϱϵϭ͕ϰϲϯ ϰ͕ϵϯϵ͕ϱϬϮ ϲ͕ϬϬϰ͕ϳϯϭ ϳ͕Ϭϯϭ͕Ϯϵϳ
ĐĐŽƵŶƚ/ŶĐƌĞĂƐĞĚ ϱϱϵ͕ϭϴϳ ϮϮϵ͕ϱϲϳ ϯϰϴ͕Ϭϯϵ ϭ͕Ϭϲϱ͕ϮϮϵ ϭ͕ϬϮϲ͕ϱϲϲ
cash + 17% stock) Dividend to the shareholders
'ƌŽǁƚŚй ϭϱй ϱй ϴй ϮϮй ϭϳй
for the year 2012.
Deposit Mobilization of Deposits
Without multidimensional and diversified products, The year 2012 was another successful year of
any financial institution especially a Bank can mobilization of deposit. Total Deposit stood at
hardly survive and thrive in competition with other TK. 417,844 million as on 31st December 2012 as
banks effectively. Keeping this in view, IBBL has against Tk. 341,854 million of the preceding year
introduced 18 deposit products so far. Historical registering a growth of Tk. 75,990 million, i.e. 22%
trend of the deposit mobilization shows a clear growth as compared to 17% in 2011.

Deposit: 2008 to 2012 New Deposit Products
/ŶŵŝůůŝŽŶdĂŬĂ In the year 2012 two new deposit products namely
Students Mudaraba Saving Account, Mudaraba
ϰϭϳ͕ϴϰϰ
Farmers Saving Account have been introduced.
ϯϰϭ͕ϴϱϰ
Ϯϵϭ͕ϵϯϱ
Welfare-Oriented Special Deposit Products
Ϯϰϰ͕ϮϵϮ
ϮϬϮ͕ϭϭϱ
Mudaraba Waqf Cash Deposit
Responding to a noble cause, this Account may

create cash waqf at a time or may start with a
ϮϬϬϴ ϮϬϬϵ ϮϬϭϬ ϮϬϭϭ ϮϬϭϮ minimum deposit of Tk.1,000/- and the subsequent
deposit shall be made by installments in thousand
Bank of over 7 Million Depositors Taka or in multiple of thousand Taka. Profit of this
account is utilized for social and human welfare as
Total number of depositors of IBBL increased per instruction of the account holders.
to 7,031,297 as on 31st December 2012 from
6,004,731 of the preceding year. 1.90 million new
deposit accounts were opened in 2012.
Growth of Deposit by Product
Sl. Deposit in Million Taka Growth Deposit Mix

Types of Deposit
No. 2012 2011 % 2012 2011
1 Mudaraba Savings 151,012 132,052 14.36% 36.15% 38.63%
2 Mudaraba Special Savings (pension) 73,546 65,492 12.30% 17.61% 19.16%
3 Mudaraba Term 97,278 65,167 49.28% 23.29% 19.06%
4 Current & Contingency 41,524 34,091 21.35% 9.90% 9.97%
5 Mudaraba Savings Bond 16,519 16,831 -1.85% 3.95% 4.92%
6 Mudaraba Monthly Profit Deposit 16,621 12,373 34.34% 3.98% 3.62%
7 Mudaraba SND 5,995 5,634 6.40% 1.44% 1.65%
8 Bills Payable 4,216 2,863 47.26% 1.01% 0.84%
9 Mudaraba Hajj 1,242 1,043 19.12% 0.30% 0.31%
10 Mudaraba Muhor Savings 323 272 18.67% 0.08% 0.08%
11 Mudaraba Waqf Cash Deposit 367 261 40.70% 0.09% 0.08%
12 Mudaraba NRB Savings Bond 605 346 74.72% 0.14% 0.10%
13 Mudaraba Foreign Currency Deposit 2,284 863 164.66% 0.55% 0.25%
14 Foreign Currency Deposit 160 332 -51.70% 0.04% 0.10%
15 FC Deposit ERQ 708 503 40.77% 0.17% 0.15%
16 FC held against B/B L/C 3,073 2,465 24.65% 0.74% 0.72%
17 FC held against Cash L/C 517 134 285.63% 0.12% 0.04%
18 FDD/FTT Payable 865 370 133.70% 0.21% 0.11%
19 Non-Resident FC of Exchange House/Banks 519 605 -14.27% 0.12% 0.18%
20 FC Security Deposit 80 71 12.46% 0.02% 0.02%
21 FC Deposit against Foreign Bank Guarantee 32 33 -3.36% 0.01% 0.01%
22 Other FC Deposit 53 52 2.34% 0.01% 0.02%
23 Students Mudaraba Savings 92 - - 0.02% -
24 Mudaraba Farmers Savings 213 - - 0.03% -
Total Deposit 417,844 341,853 21.72% 100.00% 100.00%

Deposit Mix as on 31.12.2012 month from the date of opening of the account.
The profit amount is adjusted on completion of
each accounting year after declaration of final rate
of profit.

Mudaraba Muhor Savings

As per Islamic Shari‘ah, it is fard for a husband to

pay Muhorana to his wife. The Bank introduces this
account to facilitate payment of Muhorana. Any

conscious husband may open account in the name
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of his wife on monthly installment basis.
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0XGDUDED6SHFLDO6DYLQJV6FKHPH 0XGDUDED6DYLQJV%RQG Students Mudaraba Savings
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Students aged below 18 years shall be eligible to

open Students Mudaraba Savings Account in a
Mudaraba Hajj Savings single name with his father/mother. Initial deposit
of this account is Tk.100/- and profit is given on
Any Muslim intending to perform Hajj may open
balance of Tk.100/-. No charge is applicable on this
Hajj Savings Account. The Accountholder can
account except excise duty and tax as per govt.
select one among the 25 alternatives based
policy. The account may be continued as Mudaraba
on duration ranging from 1 year to 25 years for
Savings Account in their own name when the student
building up savings by monthly installments.
becomes adult. Attractive prizes are distributed
A total of 703 Hajj pilgrims deposited money among the top 10 depositors every month.
to perform the Holy Hajj during 2012. This year
IBBL’s position in extending services to the Hajj Mudaraba Farmers Savings
pilgrims under government package was second
in position, next to Sonali Bank. Only a genuine farmer can open this account by
initial deposit of Tk.10/-. Farmers, Association or
Co-operative society of farmers, shall be eligible to
Mudaraba Special Savings (Pension) open Mudaraba Farmers Savings Account (MFSA).
Scheme This MFSA may also be opened by the father/
Considering the increase demands from the mother/legal guardian (farmer) in favor of a minor.
people of all walks of the country special and
attractive savings schemes on the basis of the Mudaraba NRB Savings Bond
Islamic Shari‘ah have been introduced to enable
Only the Non-Resident Bangladeshis aged
and encourage them to save money depending
18 years and above shall be eligible to open
on their ability when they normally retire from their
Mudaraba NRB Savings Bond Account in
active economic life. IBBL has specially introduced
single or joint names. Service charge, account
‘Mudaraba Special Savings (Pension) Scheme’.
closing fee and account maintenance fee shall
In this sceme, a person obtains the opportunity
not applicable to this account. Profit shall be
to build up savings by small monthly instalments
distributed in this account on daily product basis.
for getting an attractive amount at the end of a
As per clients demand maximum 90% quard may
specified term or a monthly amount for a specific
be allowed against total outstanding balance.
period on the expiry of the 5 years or 10 years term.
General Investments
Mudaraba Monthly Profit Deposit Scheme
Bank Investment increased to Tk.372,921 million
Any individual may open account under this as on 31.12.2012 from Tk. 305,841 million as on
scheme, depositing a minimum amount of Taka 31.12.2011 showing an increase of Tk.67,080
1,00,000/- and multiples thereof at a time, for 3 million, i.e., 22% growth against 10.03% investment
years or 5 years. Monthly provisional profit is growth of the Banking sector. This higher investment
given to the account just after completion of one

growth of the Bank in 2012 was due to the thrust Sector-Wise Investments
given to promote investment for effective utilization
of depositors’ fund. The percentage growth of Sector-wise distribution of investment as on 31st
IBBL Investment in 2011 was 16.19%. The share December 2012 vis-à-vis the corresponding
of investment of IBBL in banking sector as on period of the last year is given below:
31.12.2012 was 8.40%. Trend of investment shows
a clear direction of doubling in last 5 years. Sector wise Investment Position
Investment: 2008 to 2012

ϭϴϬ͕ϬϬϬ
ϭϲϬ͕ϬϬϬ

Amount in million Taka
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ϭϮϬ͕ϬϬϬ

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$KLHYHPHQW KƵƚƐƚĂŶĚŝŶŐĂƐŽŶϮϬϭϮ ϭϲϴ͕ϯϵϯ ϭϬϴ͕ϵϯϬ ϰϰ͕ϰϴϴ Ϯϯ͕Ϯϯϭ ϮϬ͕ϵϵϮ ϲ͕ϴϴϳ
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*URZWK
Sector-wise Investment
(In million Taka)
2012 2011
Sl.
Sector % to Total % to Total
No. Amount Amount
Investment Investment
1 Industrial (excluding SME) 108,930 29.21 122,270 39.98
2 Commercial 44,488 11.26 38,234 12.50
3 Real Estate 23,231 5.46 16,966 5.55
4 Agriculture 20,992 5.78 20,923 6.84
5 Transport 6,887 1.90 6,457 2.11
6 SME 168,393 46.39 100,991 33.02
Total 372,921 100 305,841 100
Mode-wise Investment
(In million Taka)
2012 2011
Mode % to Total % to Total
Amount Amount
Investment Investment
Bai-murabaha 221,632 59.43 177,136 57.92
HPSM 96,056 25.76 89,070 29.12
Bai Muajjal 18,295 4.91 15,912 5.20
Bill Purchased & Negotiation 9,531 2.56 2,744 0.91
Quard 9,156 2.46 5,614 1.83
Bai- Salam 4,532 1.22 3,528 1.15
Mudaraba - 0.00 2,266 0.74
Musharaka 13,719 3.68 9,571 3.13
Total 372,921 100 305,841 100

IBBL has formulated a Five Year Business Plan against Tk.150,788 million as on 31st December
(2012–2016) which is under implementation. 2011 resulting in 25.47% growth.
Investment plan has been formulated keeping
in view the national economic priorities and Contribution of IBBL to Industrialization
diversification of the Investment portfolios by size,
sector, geographical area, economic purpose and IBBL has contributed significantly to the
securities. development of industrial sector of the country.
It is the only bank that has deployed 50.73% of
its total investment in industrial sector and out
Investment in Industrial Sector
of which export-oriented garment industries
The Bank’s investment in industrial sector is occupied 44.85%. In addition to large scale
substantially higher compared to those of other industries, bank also finance medium and small-
commercial banks. Total Investment for projects scale industries keeping its primary focus on need
finance together with Working Capital stood at based industry. A brief description of industrial
Tk.189,193 million as on 31st December 2012 as financing by IBBL follows:
Industry-wise Investment of the Bank in 2012

(In million Taka)
% of Total
Sl. No. Particulars No. of Projects 2012
Amount
1 2 3 4 5
1 Textile-Spinning, Weaving & Dyeing 421 71,761 37.93
2 Steel, Re-rolling & Engineering 203 21,946 11.60
3 Agro based Industry 950 17,614 9.31
4 Garments & Garments Accessories 575 13,092 6.92
5 Food & Beverage 50 7,636 4.04
6 Cement Industry 9 1,854 0.98
7 Pharmaceuticals 36 2,289 1.21
8 Poultry, Poultry Feed & Hatchery 110 624 0.33
9 Sanitary rares 49 275 0.15
10 Chemicals, Toiletries & Petroleum 161 3,973 2.10
11 Printing & Packaging 157 3,330 1.76
12 Power (Electricity) 8 4,162 2.20
13 Ceramic &Bricks 217 2,460 1.30
14 Health care (hospital & others) 54 2,079 1.10
15 Plastic Industries 65 715 0.38
16 Petrol-Pump & CNG Filling Station 63 940 0.50
17 Information Technology 11 550 0.29
18 Hotel & resturent 177 656 0.35
19 Other Industries 305 33,237 17.55
Total 3,621 189,193 100

IBBL is the leading financer in Garments Industry
Garment Industry Pharmaceuticals & Health Care

Bangladesh earns a significant amount of foreign To boost up the medicine industry, the Bank provided
currency by exporting ready-made garments. investment facilities of Tk. 267.71 million to 71
IBBL contributed greatly to establish the garment Drug and Pharmaceuticals Industry. Moreover 54
industries of the country. From the very inception, Industries among hospital, clinic and pathological
this bank plays a pioneer role in developing the centers have been created by the Bank finance of
garment industries and its backward linkage Tk. 1,090 million from there people are receiving
industries. Most of the leading export-oriented health services.
garment industries of the country initially initiated
their business taking small size investment Housing Industry
from IBBL. Gradually they have developed their The Bank has widened its helping hand to 13,330
industries into a large one. Thus by nourishing clients by disbursing Tk.23,069.60 million housing
garment sector, IBBL has strengthened our investment at individual level and Tk.161.35 million
national economy in three ways i.e. i) Employment to 65 developers companies. Present outstanding
generation ii) Earning foreign currency and iii) in housing investment is Tk.23,231.00 million in
Women empowerment. 2012 that is 6% of total Investment having growth
rate of 28.95%.
Textile Sector
Agro-based Industry
Textile sector needs huge capital Investment.
IBBL, being the largest private commercial bank, There is no alternative to setting up the agro-
has been investing in textile sector since long. based industry for the qualitative improvement of
Huge number of spinning mills, weaving mills, the sector. IBBL provides facilities by which the
dyeing finishing mills of textile sector has been set- logistics including raw materials for the agro-based
up with IBBL Investment. Most of these mills are industry can be procured easily. Few examples of
set up with brand new state of the art technological this success are: Automatic Rice Mill, Flour Mill,
machines. This contributes immensely towards Edible Oil, Jute Mill, Fishery and Poultry & Dairy,
value addition in RMG. Salt, Sugar,Food and Beverage, Cold Storage,
Fertilizer, Oil and Electricity from Rice Bran etc.

IBBL financed Several Power Plants for infrastructural development
Electricity & Power Industry producing and procuring hardware & software.
IBBL is also working to develop innovative
IBBL has financed 8 power plants by investing entrepreneurs to embank upon big investment in
Tk.4,635 million. It also financed Tk.1233.60 this sector.
million for the production of electric instruments.
Moreover, 788 clients were provided with
SME Investment
investment of Tk.1067.60 million for producing
and procuring electronics goods. Apart from power The role of Small and Medium Enterprises (SMEs)
plants and electrical goods, we are also working on is indispensable for overall economic development
solar power and an investment scheme under the of a country particularly for a developing country
name and style “Solar Panel Investment Scheme” like Bangladesh. Bangladesh Bank has given
has already been introduced. emphasis to the development of the SME sector
of the country financing through the commercial
Transport Industry banks. IBBL, since its inception, has been
continuing SME financing for its development.
Islami Bank has been providing investment
facilities to the experienced, innovative and new The Bank management has adopted a new SME
entrepreneurs for purchasing modern vehicles Policy comprising 2(two) special schemes namely
(Road, Water & Air). To develop the transport Women Entrepreneurs’ Investment Scheme and
sector, IBBL has disbursed substantial amount Non-Resident Entrepreneurs’ Investment Scheme
of investment which is the highest among all for boosting up of SME investment.
nationalized and private commercial banks of
IBBL also undertakes various initiatives for
Bangladesh and the proportion of our investment
development of SMEs & Women entrepreneurs
is 1.78%. Besides, IBBL financed 60 Filling/CNG
like arranging training for the entrepreneurs,
stations against present balance of investment of
creating awareness on the importance of SMEs
Tk.523.30 million.
through media, by participating in fairs, road
shows, seminars, workshops etc. It also trains
Information Technology Industry the Greenfield enterprises how to access finance
IBBL has already extended financial support through banking channel and benefit from Islamic
amounting Tk. 549.70 million to 11 clients for modes & products for SME Investment, etc.

Outstanding SME Investment of Islami Bank PCBs has been raised by 3% as on 31.12.2012
zĞĂƌǁŝƐĞ^D/ŶǀĞƐƚŵĞŶƚŽĨ/>
Bangladesh Limited is Tk.182,753.00 million as from 31.12.2011.
ϮϬϬϬϬϬ
on 31.12.2012 against 46,269 clients. ItϭϴϮϳϱϯ
is 47% of
ϭϴϬϬϬϬ
the Bank’s total investment. ^DǆƉŽƐƵƌĞŽĨ/>ǀƐWƐ
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ϭϴϮ͕ϳϱϯ
ϭϴй Welfare-oriented Investment Schemes
In addition to the normal commercial and
industrial investment operations, IBBL has 14
Special Investment Schemes targeting different
EĂƟŽŶĂůĞǆƉŽƐƵƌĞ economic groups. The schemes are implemented
ŽƚŚĞƌƚŚĂŶ/>
ϴϮϱ͕ϯϳϵ and expanded to meet the specific and welfare
ϴϮй oriented needs of different groups of people
particularly the under-privileged downtrodden
and the neglected section of population of the
Contribution of IBBL to the national SME has been country. To uplift the lifestyle of these people,
raised by 5% as on 31.12.2012 from 31.12.2011 some welfare-oriented special investment
and contribution to the total SME exposure of schemes as under have been undertaken:
IBBL’s SME Exposures of Different Banks of the Country

(In million Taka)
Year IBBL PCBs SME % of IBBL to PBs Total National % of IBBL to Total
Exposure Exposure National Exposure
2011 108,670 484,292 22 810,992 13
2012 182,753 719,845 25 1,008,132 18
Scheme-wise Investment of the Bank

(In million Taka)
Sl. No. Name of Scheme 2012 2011 2010 2009 2008
1 2 3 4 5 6 7
i. Rural Development Scheme (RDS) 10,390 7,072.02 5,110.00 3,752.20 3,011.72
ii. House-hold Durables Scheme 955 1,070.01 961.64 686.49 638.40
iii. Investment Scheme for Doctors 32 13.91 15.27 17.06 15.34
iv. Transport Investment Scheme 6,887 6,706.50 4,732.15 3,630.48 3,087.55
v. Car Investment Scheme 113 152.05 138.79 53.81 41.16
vi. Small Business Investment Scheme (SBIS) 2,774 2,347.60 1,703.44 1,159.63 1,104.65
vii. Micro-Industries Investment Scheme 36 38.18 47.44 50.39 31.50
viii. Agricultural Implements Investment Scheme 278 209.60 127.15 76.64 27.21
ix. Housing Investment Scheme 316 366.68 418.92 452.67 429.24
x. Real Estate Investment Program (REIP) 23,231 12,485.24 10,154.95 7,933.20 7,183.26
Sub-total 45,012 30,461.79 23,410.00 17,812.57 15,570.03
(Investment under Schemes)
Total Investment 372,921 305,841 263,225 214,616 180,054
% to total Investment 12.07 9.96 8.89 8.30 8.65

Women entrepreneurship under SME Investment
Household Durable Investment Scheme confidence and human dignity. IBBL has steady
growth in the Real Estate Sector.
Low-income people involved in diverse professions
get benefit out of this scheme. They are provided
Transport Investment Scheme
with household products like refrigerator, TV,
motor-cycle, furniture, ornaments, computer etc. To ease the existing transportation problem and
under this financing scheme. to accelerate the pace of economic growth and
development of the country, particularly through
Housing Investment Scheme expansion of trade, commerce and industry, the
Bank has taken up this sceme.
The Bank has introduced this scheme to ease the
serious housing problem in the urban areas and to
make arrangement for comfortable accommodation Car investment Scheme
of the fixed income group such as: officials of To enable officials, business houses and
the defense services, permanent officials of business executives and professionals to move
government, semi-government and autonomous by transports in discharging their responsibilities
organizations, faculty members of the established punctually, IBBL has introduced Car Investment
universities, university colleges & medical colleges, Scheme for the mid and high ranking officials of the
graduate engineers, doctors and established government and semi-government organizations,
professionals, international financial organizations, corporations, executives and directors of big
donor agencies, foreign embassies etc., officials of business houses and companies and also for
reputed local public limited companies. persons of different professional groups on easy
payment terms and conditions.
Real Estate Investment
Real Estate Finance plays a pivotal role in improving Investment Scheme for Doctors
standard of living, empowering the middle-income The scheme is meant for fresh medical graduates
and lower-income groups and thereby promoting intending to et up medical centres. IBBL comes
equitable growth in the society. It does not only forward for their aid to help them procure medical
provide physical shelter but also upgrade the lives equipment or to set up diagnostic laboratory,
of the dwellers in terms of skills enhancement, pharmacy, clinic etc.
income generation, increased security, health, self-

Dying Industry financed by IBBL IBBL financed Spinning Industry
Small Business Investment Scheme stock farming, hollow bricks, roof tiles and any
other viable micro-industries have been identified
Small business persons and entrepreneurs
for financing under the scheme.
of different cities and villages get investment
facilities from this scheme which is contributing
greatly to generate income and employment and
Rural Housing Investment Scheme
to develop standard of life of different segments of This scheme was launched to extend housing
low income people. This Bank provides different facility to the rural people living within 5 kilometers
types of agricultural instruments, equipment for area of a IBBL branch. Employees of public, semi-
operating small trade and finance, small shop, public or autonomous institutions, non-resident
light transport, photo copy machine, tailoring
Bangladeshis and businesspersons are preferred
machine, machinery for small and cottage industry
for this investment. Easy term investment is given
etc. under this scheme.
for constructing new houses, repair of old houses
and purchasing ready-made flats and houses etc.
Agricultural Implements Investment
Scheme Women Entrepreneurs Scheme
Keeping the view of the people-orientation and IBBL has introduced “Women Entrepreneurs
welfare objectives of the Bank, this scheme has
Investment Scheme” to help women contribute
been introduced to provide power tillers, power
to GDP, generate income & employment and to
pumps, shallow tube-wells, thresher machines
develop their socio-economic condition. Under this
etc. on easy terms to the unemployed rural youths
Scheme Bangladeshi nationals aged between 18-
for self-employment and to farmers to help them
50 years, genuine women entrepreneurs, women
augment production in the agriculture sector.
already engaged in business, self-employment
activities as owners, skilled and semi-skilled
Micro-Industries Investment Scheme
female persons having practical experience in the
To create a wider base for industries and to respective field may apply for investment.
encourage establishment of micro-industries
in different areas of the country by the potential NRB Investment Scheme
entrepreneurs and to diversify the Bank’s
investment portfolio, the Bank has introduced For promoting investment among non-resident
‘Micro Industries investment Scheme’. Different Bangladeshis and for encouraging them to
sectors including food and agriculture based remit money through banking channel, IBBL
industries, plastic & rubber industries, forestry and has launched NRB Entrepreneurs Scheme.
furniture industries, engineering industries, service Expatriates aged between 18 to 60 years or their
industries, electrical accessories industries, family members who run account with IBBL for
computer technology industries, paper products remitting money are eligible for this investment.
industries, handicrafts industries, fishery & live

Some Projects Financed by IBBL
Sugar Factory Spinning Mill
Ship Building Industry Pharmaceutical Industry
Cable Industry Still Re-rolling Mill

Some Projects Financed by IBBL
Poly Fiber Industry Energy Bulb Industry
Financing in agro-equipments Horticulture Project
Tyre and Tube Factory IBBL financed Brick Field

Inauguration of Urban Poor Development Scheme
Micro-Investment Activities under achieve financial inclusion of poor women of rural

& urban areas. These two schemes enable IBBL
RDS & UPDS to achieve financial inclusion of poor women of
Rural Development Scheme (RDS) was rural & urban.
introduced in 1995 to meet investment needs of
agriculture and rural sector and create opportunity RDS: Coverage and Expansion
for employment generation and raise income
The target groups are organised as members
of the rural poor to alleviate poverty. So far, out
in the selected villages/areas in groups under
of 276 branches, 197 carry out RDS activities in different centres. At present, 733,520 members
61 districts of the country. The Bank launched receive financial services under 24,623 centres in
another micro-investment scheme for urban poor 15,371 villages. Ratio of female members under
in 2012 in the name of “Urban Poor Development the schemes is 85%. Expansion of RDS in the last
Scheme (UPDS)” on pilot basis under its 10 urban 5 years is shown in the following table:
branches. These two schemes enables IBBL to
RDS & UPDS Investment

(In million taka)
Sl. Particular RDS UPDS Total
01 Micro Investment Client No. 418,839 2,886 421,707
02 Micro Enterprise Client No. 52,651 408 53,059
03 Quard Client No. 1,543 - 1,543
04 Total client 473,033 3276 476,309
05 Outstanding of MI (in million Taka) 5985.75 49.87 6035.62
06 Outstanding ME (in million Taka) 4321.67 35.87 4357.54
07 Outstanding of Quard (in million Taka) 7.79 - 7.79
08 Total outstanding investment 10,315.21 85.74 10,400.95

Institutional Development
Sl. Particular 2008 2009 Growth 2010 Growth 2011 Growth 2012 Growth
No. (%) (%) (%) (%)
01 No. of village 10,676 10,751 1 11,482 7 12,857 12 15,507 21
02 No. of Centre 21,193 22,261 5 20,833 (6) 22,206 7 24,623 11
03 No. of Member 577,740 492,475 (15) 523,941 6 608,703 16 733,520 21
04 No. of Investment 321,848 312,036 (3) 319,859 3 382,319 20 474,766 24

Client
RDS & UPDS Investment (2008-2012)

(In million taka)
Sl. Particular 2008 2009 2010 2011 2012
01 MI client 311,655 292,967 291,293 343,304 421,707
02 ME client 9,829 19,069 28,566 39,015 53,059
03 Total 321,484 312,036 319,859 382,319 474,766
04 % of MEIS client 3 6 9 10 11
04 MI Investment 2,522.79 2,671.29 3,186.28 4,234.18 6035.62
05 ME investment 488.93 1,080.91 1,923.77 2,837.85 4357.54
06 Total 3,011.72 3,752.20 5,110.05 7,072.03 10,393.16
07 % of MEIS investment 16 29 38 40 42
RDS Investment Program

dƌĞŶĚŽĨDŝĐƌŽͲ/ŶǀĞƐƚŵĞŶƚΘDŝĐƌŽ
Under both RDS & UPDS, three types of investment ŶƚĞƌƉƌŝƐĞ/ŶǀĞƐƚŵĞŶƚƵŶĚĞƌZ^ΘhW^
facilities are provided to the beneficiaries namely
(a) Micro-investment (collateral-free investment ϭϱ͕ϬϬϬ͘ϬϬ
maximum Tk.50,000/- provided to the poor in
different income generating activities); (b) Micro- ϭϬ͕ϬϬϬ͘ϬϬ
enterprise Investment (collateralized investment
maximum Tk.300,000/- provided to the graduated
ϱ͕ϬϬϬ͘ϬϬ
and other micro-clients and (c) Quard Program
(cost-free loan maximum Tk.10,000/- provided to
the distressed & hardcore poor for rehabilitation Ͳ
and water & sanitation). Allocation for Quard

Program is given from RDS Welfare Fund. Since
the inception of the Bank cumulative disbursement Z^'ƌĂĚƵĂƟŽŶůŝĞŶƚƐWŽƐŝƟŽŶ
under the above three types of investment stood
ϭϬϬϬϬ
at Tk. 56,809.93 million. Investment under both ϴϰϴϮ ϴϴϵϬ
the Schemes as on 31 December 2012 may be ϴϬϬϬ
seen below: ϱϳϭϯ
ϲϬϬϬ
ϯϳϰϵ
Graduation Program ϰϬϬϬ
ϭϵϯϮ
The graduated RDS members (who already have ϮϬϬϬ
availed the highest limit under RDS) and the local
Ϭ
small entrepreneurs are provided with investment ϮϬϬϴ ϮϬϬϵ ϮϬϭϬ ϮϬϭϭ ϮϬϭϮ
facilities under ‘Micro Enterprise Investment

Dr. Selina Hayat Ivy, Mayor of Narayanganj City Corporation is addressing an RDS Program
Scheme (MEIS)’ up to a maximum ceiling of Tk.

300,000. At present 53,434 clients are enjoying
ƵŵƵůĂƟǀĞ^ĂǀŝŶŐƐŝŶZ^
investment facilities under MEIS out of whom ;ŝŶŵŝůůŝŽŶdĂŬĂͿ
graduated RDS members are 9,618 which shares
ϰϬϬϬ͘ϬϬ
18% of total MEIS clients. ϯϯϬϬ͘ϴϱ
ϯϬϬϬ͘ϬϬ
ϮϯϰϬ͘ϰϱ
Savings Program ϭϳϳϱ͘ϱϳ
ϭϰϴϴ͘ϳϳ
ϮϬϬϬ͘ϬϬ
The members under the Schemes have to deposit ϭϮϳϬ͘ϱϬ
compulsory weekly savings with the Bank at least ϭϬϬϬ͘ϬϬ

Tk.20/- per week. But they are encouraged to
deposit more in view to develop their own equity Ϭ͘ϬϬ
quickly. The volume of savings of RDS members
reached Tk. 3,300.85 million as on 31st December,
2012. Year-wise cumulative savings under RDS is
shown in the following graph:
RDS Social Safety-net Programs 2012

(In million Taka)
Sl. No. Program Beneficiary Amount Percentage Share
01 Education Program (Alo + An-Noor) 14,572 28.18 39
02 Training Program 68,220 7.82 11
03 Health Program 22,780 25.67 36
04 Relief & Rehabilitation Program 1,622 9.89 14
05 Total expenditure from RDS Welfare Fund 107,194 71.56 100
06 Environment Protection Program (Plantation) - 11.42
(from mainstream fund)
07 Grand Total 107,194 82.98

Social Safety-net (Welfare Activities) Maqtab (An-Noor): In 2012, 114 maqtabs
Program under RDS named “An-Noor” program began in the suitable
mosques. Each of the maqtab is being operated
As poverty alleviation needs a combination of by the concerned Imam for imparting elementary
financial and non-financial programs, different religious teachings to about 30 students as well
welfare services are conducted under RDS in the
as getting them able to recite the Holy Quran
areas of (1) Education, (2) Training, (3) Health,
correctly.
(4) Relief & Rehabilitation and (5) Environment.
In this respect a Welfare Fund has been Activities under Education Program during the
developed by segregating 1% profit against RDS year (from January to December 2012) at a glance
investment. An amount of Tk.82.98 million has are shown in the following table:
so far been spent for social safety-net programs
under RDS during the year 2012 which table is Training Program
shown in previous page.
There are three types of training activities viz. (a)
Details of the Programs and program-wise Leadership Training, (b) Skill Development Training,
performance are mentioned below: and (c) Self-employment Training.
Education Program Health Program
There are 3 (three) activities under Education Under health program 3 types of assistance are
Program which includes: (a) Scholarship, (b) provided: (a) Water & Sanitation, (b) Medical
Academic Award & (c) Establishment of Institutions Assistance and (c) Gift for newborn baby.
(pre-primary school & maqtab).
Relief & Rehabilitation Program
Pre-primary School (ALO): Last year, 114 Pre-
primary Schools for the beginners were established Under the relief & rehabilitation program 3 types of
in different remote villages under the title of “ALO: assistance are provided to the poor and distressed
Pre-primary School”. Each school is operated by members: (a) Waiver of Bank’s dues, (b) Quard for
a single female teacher with a target to prepare rehabilitation and (c) Relief & Donations.
25-30 students every year for getting admission in
Class I in the local primary schools.
Education Program under Rural Development Scheme

Shanti Nath changes her fate by weaving Mats for others
Environment Islami Bank Bangladesh Limited launched another

new microfinance scheme in the name of “Urban
IBBL implements Plantation Program during the
Poor Development Scheme (UPDS)” in the year
rainy season every year. Plantation Program is
conducted by giving free saplings to the RDS 2012 to extend microfinance activities among the
members. Every year, the Bank has been providing urban poor. Activities of the scheme were started
saplings, especially of the fruit plants, one per under 10 urban branches in Dhaka and Chittagong
RDS member since 2003. During the year 2012, a cities on pilot basis.
total of 506,000 saplings were distributed/planted
at the cost of Tk. 11.42 million. Since inception, Agricultural Investment
a total of 2,828,723 saplings were distributed at
a cost of Tk.243.00 million. However, the Bank Islami Bank Bangladesh Limited provides adequate
conducts the Program with its mainstream fund. importance to agricultural/rural investment since its
inception. Accordingly, two investment schemes viz
Urban Poor Development Scheme (UPDS) Agricultural Implement Investment Scheme (AIIS)
About 3.50 million extreme poor live in the urban and Rural Development Scheme (RDS) were
areas as slum dwellers. They live hand to mouth introduced in 1992 & 1995 respectively for effective
and lead a sub human life. Considering the above, development of agriculture and rural economy.
Comparative Position of Agri-Investment in the Country

(In million Taka)
Disbursement % of Growth Over the
Target % of Achievement
Fiscal Year Previous Year
National IBBL National IBBL National IBBL National IBBL
2007-2008 83,090 2,750 85,810 5,140 103 188 62 20
2008-2009 93,790 6,600 92,850 6,240 99 95 8 21
2009-2010 115,000 8,800 111,170 8,410 97 96 20 35
2010-2011 126,174 9,500 121,844 10,210 97 107 10 21
2011-2012 138,000 10,000 131,320 11,703 95 117 15 15

Dr. Atiur Rahman, Governor of Bangladesh Bank is handing over award to Jessore Branch Manager of IBBL for highest agricultural investment
In 2012, the Bank disbursed Tk.12,500.00 Asset Quality

million in agriculture sector against its target of
IBBL continues to maintain strong asset quality.
Tk. 12,000.00 million having a growth of 29%
Investment facilities are allowed in a manner so
over the previous year. At the end of the year, that credit expansion goes on ensuring optimum
agriculture financing (excluding agro-based asset quality. Investment facilities are extended to
industry) accounted 2.40% of total investment of customers who comply with the Bank’s norms and
the Bank. Besides, under the special program princilples.
of Bangladesh Bank (investment in cultivation of
pulse, oil seed, spices & maize at discounted rate
Non-performing Investment
of profit 4%), IBBL disbursed Tk.9.63 million in the Non-performing Loans and Advances of the State
previous fiscal year (2011-2012). owned Commercial Banks, Private Commercial
Banks and Foreign Commercial Banks in 2012
stood respectively at 23.87%, 4.58% and 3.53%
Sector-wise Disbursement of
against industry of 10.03%.
Agricultural Investment
(In million Taka)
IBBL’s position was better than national non-
performing Investment position. Classified
Sector Achievement Investment as on 31.12.2012 was 3.81% of total
investment. Investment overdue but not classified
Crops 3,359
as on 31.12.2012 was 1.08% of total investment.
Fisheries 1,246
Status of NPI in IBBL
Livestock 1,801
(In million Taka)
Agricultural Implement 272 Sl No. Particulars 2012
Poverty Alleviation 3,106 1 NPI (NPL) Ratio at IBBL 3.81%
Storage 1,101 2 Industry Average of NPL 10.03%

3 Required Provision 5,718.66
Others 818
4 Provision Maintained 5,718.66
Total 11,703
5 Provision Maintained Ratio 100%

branches, i.e. branches having licences to handle
^ĞĐƚŽƌĞͲǁŝƐĞŝƐďƵƌƐĞŵĞŶƚŽĨ Import, Export and Remittance business in 2012
ŐƌŝĐƵůƚƵƌĂů/ŶǀĞƐƚŵĞŶƚ;йͿ
2WKHUV Import
6WRUDJH
During 2012 the Bank opened 54,412 import
&URSV Letters of Credit for Tk.284,588 million as against
47,191 Letters of Credit for Tk. 301,207 million in
3RYHUW\ 2011 showing 15.30% growth in number of LCs.
$OOHYLDWLRQ
Major items of import consist of the following:
)LVKHULHV
$JULFXOWXUDO
Import Position of IBBL
/LYHVWRFN
,PSOHPHQW
,QPLOOLRQ7DND

Foreign Exchange Business

IBBL plays a very important role in the Country’s

Foreign Exchange Business of the country. Total

Foreign Exchange Business handled during

the year 2012 was Tk.782,598 million. The

comparative figures are given below:

Total Foreign Exchange business handled by the
9ROXPH
Bank demonstrated a growth of 9.29% in 2012 *URZWK
over 2011. There were 46 Authorized Dealer (AD)
Foreign Exchange Business of the Bank

(In million Taka)
2012 2011 % of growth in 2012

Particulars
Amount % of Total Amount % of total over 2011
Import 284,588 36.36 301,207 42.06 -5.51

Export 197,095 25.18 178,244 24.89 10.57
Remittance 300,915 38.45 236,607 33.04 27.17
Total 782,598 100 716,058 100 9.29
Import Position
(In million Taka)
2012 2011
Sl. No. Items
Amount % of total Amount % of total
1 2 3 4 5 6
1 Raw Cotton, Yarn, Fabrics & Accessories 112,886 39.66 100,773 33.46
2 Capital Machinery 14,621 5.13 12,871 4.27
3 Fertilizer 24,378 8.56 30,285 10.05
4 Wheat 6,118 2.14 8,092 2.69
5 Iron, Steel & Other base Metals 8,082 2.83 8,096 2.69
6 Motor Vehicles 3,411 1.19 4,639 1.54
7 Chemicals 8,668 3.04 7,284 2.42
8 Edible Oil (Crude & Refined) 16,457 5.78 21,240 7.05
9 Rice 301 0.10 952 0.32
10 Scrap Vessel 7,343 2.58 1729 0.57
11 Others 82,323 28.92 105,246 34.94
Total 284,588 100 301,207 100

Rural woman processing paddy in a terrace
Export Exchange House Arrangement

During 2012 the Bank handled 54,188 Export Bank has established remittance arrangement
Bills for Tk.197,095 million as against 45,433 with 114 Exchange Houses in 17 countries of the
Export Bills for Tk.178,244 million in 2011 showing world for facilitating remittance services. IBBL as a
10.57% growth in amount. Major export financed member of Bangladesh Electronic Funds Transfer
items were the following: Network (BEFTN) is routing 90% of its 3rd bank
remittance by using BEFTN.
Export Position of IBBL
SMS & Centralized Account Opening
,QPLOOLRQ7DND

IBBL has introduced SMS (short message service)
for the expatriates and their beneficiaries in this
year. Under this arrangement, expatriates can

update about their account balance at any time
from abroad. Besides IBBL now opens deposit
accounts for the expatriate customers centrally
which inspires them to remit money through

banking channel.

9ROXPH
*URZWK Remittance Card
The Bank also introduced Remittance Card for the
Foreign Remittance
expatriates and their beneficiaries by which they
Total remittance collection stood Tk. 300,915 can send money without having a bank account.
million in 2012 which was Tk. 64,308 million higher The Cardholders can draw money 24 hourss from
than the total remittance of Tk. 236,607.00 million ATM and from bank counter within banking hours.
received in 2011. IBBL attained 27.17% growth and
27.70% market share in the country’s remittance Web Portal System
during 2012. IBBL is considered market leader in IBBL has also introduced web portal system under
Foreign Remittance collection for providing proper which the expatriate account holder can check
marketing and carrying customer services. account balance of his account and also can

Export Position
(In million Taka)
2012 2011 Growth % in 2012
Sl.
Items
No. over 2011
Amount % to total Amount % to total
i. Garments and Textile 158,851 80.59 142,734 80.07 11.29
ii. Frozen Foods & Vegetables 1,980 1.00 1,074 0.60 84.35
iii. Jute & Jute Goods 9,992 5.06 7,898 4.43 26.51
iv. Leather 134 0.06 73 0.04 83.56
v. Tea 89 0.04 2 -
vi. Chemical 361 0.18 - -
vii. Others 25,688 13.03 26,463 14.84 -1
Total 197,095 100 178,244 100 10.57
transfer fund from his account to other account with financial institutions around the globe to
maintained with IBBL. facilitate foreign trade. Financial Institutions
Department (FID) plays vital role in linking
NRB Customer Care with the major financial institutions abroad for
facilitating growing volume of international
IBBL has a Centralized Customer Service Department trade and remittance business. A brief picture of
with efficient officials to solve any problem related to relationship status of IBBL is as follows:
foreign remittance at home and abroad.
IBBL’s Foreign Business Network
IBBL’s Representative in Abroad
Sl.
To encourage Bangladeshi expatriates for Items Number
No.
sending their hard earned foreign currency
1 Number of Nostro accounts 37
through Banking channel. To assist them for
2 Number of currencies Nostro A/Cs 10
opening account from abroad, 28 officials of
are maintained
the Bank are working in Kingdom of Saudi
3 Number of RMA (Arrangement 573
Arabia (KSA), UAE, Bahrain, Qatar, Oman and
for authenticated financial
Singapore. communications)
4 Number of Countries with RMA 78
Comparative Position of Remittance 5 Number of Banks with RMA 233
6 RMA established in 2012 96
,QPLOOLRQ7DND
Correspondent Banks paid Visit to Our Bank

During this year, 48 foreign correspondents
namely Standard Chartered, Citi N.A., Mashreq,

JP Morgan Chase, Commerz AG, ICICI India,

Axis India, UBAE Italy, Sumito Mitsubishi Banking
Corporation Japan, Doha Commercial Bank Qatar,

United Bank UAE, Deutsche Bank Germany,
9ROXPH
*URZWK Unicredito Italiono Bank Italy, Habib AG Zurich
6KDUH Switzerland, Bank of Montreal Canada, Zorcher
Kantonal Switzerland, Bank Soha, Rabo Bank
Netherland, HDFC India, Askari Bank, National
Relationship with Correspondents in Abroad
Bank of Oman, Bank Muscat Oman etc. visited
Islami Bank Bangladesh Limited has established the Bank and shared views and ideas on mutual
and has been maintaining networking relation business interests.

IBBL financed one third of Country’s investment in the food industry-Rice Mill is one of those
Visit by International Agencies establishing Central Processing Center (CPC). Now

the Center is processing Foreign Trade Products of
The undermentioned International Agencies AD Branches from a single processing center.
visited our Bank during the year 2012. International
Finance Corporation (IFC), World Bank Group, IBBL is the pioneer among the local banks in
Islamic Corporation for the Development of the trade centralization maintaining the International
Private Sector (ICD) of IDB Group, International Standard (scan based) in the country which is very
Monetary Fund (IMF) and Asian Development much significant for a Mega Bank like IBBL.
Bank (ADB) visited the Bank on different schedules
and discussed with the Senior Management Offshore Banking Units (OBU)
mutual business potentials.
Islami Bank Bangladesh Limited obtained
permission from Bangladesh Bank to operate
Foreign Trade Processing from a 3(three) Off-Shore Banking Units (OBU) located
at Head Office Complex Corp. Branch, Dhaka,
Central Hub
Agrabad Branch, Chittagong and Uttara Branch,
Islami Bank Bangladesh Ltd. handles substantial Dhaka. The operations include to receive deposit
volume of Foreign Trade business of the country from Non-Residents in Foreign Currency and
which is increasing day by day. To handle the to discount usance import documents of AD
huge volume of Foreign Trade Business of the Branches in Foreign Currency under UPAS
Bank in a better and more efficient way, IBBL (Usance payment at sight) arrangement.
started Centralized Trade Processing in 2010 by
Performance of UPAS ( Usance Payment at Sight) in 2012 through OBU:
Nos. of Amount in Amount in

SL. No. Particulars
Issue million USD million BDT
1 No. of AD Branches availing UPAS facility 10

2 Total L/Cs opened by AD under UPAS in 2012 713 226.31 18070.83
3 Import Bills Settled under UPAS in 2012 549 171.20 13670.30
4 Outstanding UPAS import Bills 396 124.45 9938.78
5 Income earned by OBUs from UPAS import Bills 1.79 142.31

Case Study
Poultry Farm Changes Anjuara’s Anjuara would rear some hens as her hobby.
Days Sometimes she would sell some eggs to buy other
daily essentials. Very often she would sell one or
Anjuara’s paternal family was not so solvent. two hens to meet emergency of the family. Anjuara
Unlike others, their poverty was not that abject. thought if she had more hens she could have
Accepting the little deficit and discontent, Anjuara contributed more to her family. Thinking more and
of Mirkamary village of Ishwardi, was passing
more about this, a plan of setting up poultry farm
happy days in her father’s family.
hit her brain.
But misfortune suddenly engulfed her in such a
Anjuara shared the idea with her husband. Her
way that she was as if thrown in a sea. It happened
husband also liked the idea. From poultry farm
immediately after she got married. The financial
Anjuara could earn money staying at home. Her
condition of her father-in-law’s family was not good.
husband did not like Anjuara to go outside. Anjuara
They were passing days in woes. They were living
also did not like to go outside for earning. But the
in a joint family. In this situation Anjuara’s husband
Babul Islam was separated from his father’s family. problem was to have enough money to set up a
Babul owned a small piece of agricultural land as farm. Anjuara’s husband Babul discussed with his
his share. They could meet a few months demand well-wishers poultry about farm idea. In this way
by the crops of the land. It was not possible for the matter reached the ear of field officer of the
them to run the family round the year by limited local unit of Rural Development Scheme (RDS) of
crops of their agricultural land. In this miserable Islami Bank Bangladesh Limited. Field Officer met
condition of the family, they have been blessed with Babul. He proposed Babul Islam about financing
a child. Instead of becoming happy for having the to set up a poultry farm. He also suggested them
first child, it increased their tension more. Anjuara to be a member of RDS unit to get investment.
lamented thinking of her child’s future.

Anjuara became a member of Rabeya Basri (R) first phase Anjuara took more investment in the
unit of RDS in 2005. A few days later the bank second phase. Their profit kept increasing. Later,
sanctioned 8 thousand taka investment to Anjuara. they took big amount of investment. Their project
By this investment they built a teen-shed house, kept expanding. In the last phase she took an
bought chicken, poultry feed and other essentials investment of 40 thousand taka. One thousand
for the farm. Anjuara’s husband would assist her new chickens were added to the farm. In this way
to run the farm side by side his own work. In the the size of the poultry farm of Anjuara expended
first phase they made handsome profit selling day by day. Poverty turned fugitive and they
hens and eggs. After paying installment of the needed no looking back.
Rubia: An Embodiment of
Enterprising Sprit
Rubia Khatun, a dweller of West Baghail village of
Pakshi, Pabna is a lady of competitive zeal. Her
husband used to work in other’s land as a day
laborer. They have a seven member family. It was
difficult to run the family from one man’s earning.
They were passing days in woes. They used to
live in a small congested house. They could not
send their children to school. They had a tube well
but no sanitary latrine. On the whole they were
leading a miserable life.
Rubia was thinking how she could help her

husband. She came to know about Rural
Development Scheme (RDS) of Islami Bank. She
became a member of 39 Sumaya unit of Area
number 7 of Pakshi branch in 2006. She took
an initial investment of Tk. 7,000/- and bought
a cow. This cow gave birth to two calves in
consecutive two years. She started earning by
selling milk. Later she bought more cows taking
fresh investment. She took 5 bigha lands as lease
for her cows. Later she bought a paddy thresher
machine. She built a house and kitchen. As of now
she took 93 thousand taka as investment from the
Bank.
There is no sign of poverty in Rubia’s family now.

It has been possible for taking RDS investment.
There are four earning members now in her family
completing primary schooling. Her three children
became carpenters. They built sanitary latrine.
Now she wants to build a pucca house by taking
investment.

Chitra becomes Self-reliant by Dairy Farm
Chitra Saha, an inhabitant of Norottom village of planned to build a dairy farm. To fulfill the dream, she
Begumgang upazial of Noakhali district has become took an investment of Tk 5,000/- and bought a cow.
self reliant by dairy farm. Her husband was a day
Her condition started changing gradually. She took
labourer. But by their joint efforts they have changed
more investments from IBBL. Untill reported time
the face of their family. Their two sons are continuing
she owns four cows. Chitra expressed her gratitude
study. The economic condition of Chitra’s family
for proper guidance and financial backing of Islami
was not so good before joining Rural Development
Bank for her success.
Scheme (RDS). Chitra sought to be self reliant. She
Madhobi’s Mat Crafts

mat. Their profit began multiplying by degrees.
Madhobi Rani, a housewife, is an inhabitant of
They took investment of 10 thousand taka in
Arongshile of Bogra district. She is also poor,
second phase. At that time they rented a house
like most of the inhabitants of her village. But her
in Mirzapur Bazar for selling mat. They started to
poverty is not comparable to other villagers. She
keep melamine utensils in the shop besides mat.
is rather ultra-poor and landless. She used to stay
Selling was going on well. Paying bank installment,
making a small house in other’s land.
they took further investment. Their production
Madhobi Rani’s husband Lakkhan Debnath makes capacity increased. Instead of making mat they
mat and sell it in the local market. Madhobi also started collecting readymade mat from the village
used to assist her husband to make mat. But and selling in to other shops. Gradually they turned
regular buying of foods was not possible for his themselves as wholesale traders.
five-member family.
At present they have goods in their shop worth 5
This story goes back to 2006. Madhobi registered lac taka. Two employees work in the shop. They
herself as a member of Rural Development bought 2 decimals of land and built a teen-shed
Scheme of Islami Bank Bangladesh Limited. She structure there. They have now tube-well and
took an investment of 5 thousand taka. With this, sanitary latrine. Madhobi couple is now leading a
they bought more canes than earlier to produce happy life.

Nilufa becomes Self-reliant Nasir would sell those “thonga” in the market. They
started making profit from thonga trade. From the
Making Paper-packet (Thonga)
earning they continued paying regularly the bank
Nilufa’s family was a needy one. They were have- installments. The Bank sanctioned them fresh
nots. They used to stay in a shabby house. But investment after payment of first phase. In second
they coped with this situation by honesty, integrity phase they got investment of Tk 10,000/-. In fifth
and hard work and brought themselves to the phase they took an investment of 25 thousand taka.
solvent class.
They built a new house breaking the shabby one.
Nilufa’s husband Nasir Ahmad is a “thonga” maker. They own a tube well. They have also a sanitary
But he could not expand his business for lack of latrine now. In the meantime, they were blessed
capital. So they were unable to lead a solvent with two more children. They don’t have to face any
life. They had only one child. They could not run problem now although they have several mouths to
even the three member small family smoothly for feed. They can afford to maintain the family easily.
poverty. They were passing days in woes. In the
meantime Allha’s blessings were bestowed
upon them. They met the demand of capital by
Rural Development Scheme (RDS) of Islami
Bank Bangladesh Limited. Blessing wind hit
the sail of their business. Change of life started.
This is the story of 2001. They got introduced to

field officer of RDS of Islami Bank Bangladesh
Limited. Nilufa became a member of Hazrat
Mariam (R) unit of RDS following the suggestion
of the field officer. A few days later she received
an investment of Tk 5,000/- from the Bank. With
this money they started Thonga making business.
Her husband used to collect paper roaming

around village after village. They could make
“thonga” with those papers staying at home.

Solvency through Cottage Industry
Cottage industry has brought fortune
to Shamsunnahar of Maizdicoart.
Shamsunnahar has not only changed
her own fate but also played a role
to bring fortune to many families
including her neighbours. It was
possible for her dream, effort and
sincerity to change her own condition.
Rural Development Scheme (RDS)
of Islami Bank Bangladesh Limited
stood beside Shamsunnahar to
translate her dream into a reality.
There are six members in

Shamsunnahar’s family. Her husband
is a daily basis part-time messenger.
Shamsunnahar’s family was not
running properly with her husband’s
meagre income. They were passing
days in woes. Shamsunnahar used to lament seeing her children’s sad face. She always thought if she could
have done something. She wished if she could have some extra income side by side her husband.
One day her wish came into true. Shamsunnahar registered herself as a member of Ma Halima Unit of Rural
Development Scheme, in 1996. She took investment of Tk 5,000/-. She bought bamboos and canes with this
investment and started producing handicrafts like “Dala”, “Kula”, “Chaluni” (riddle) etc. Dealers come home
and take them buying. As a result, Shamsunnahar got opportunity to earn extra money staying at home.
With this earning, she was able to built a new house with corrugated teen. She is now capable to send her
children to school. Seeing the success of Shamsunnahar, many came forward to set up cottage industry.
Shamsunnahar helped them by giving suggestions and planning. In this way Shamsunnahar helped to change
luck of many including her.
Momina Begum’s Nursery Says ‘No’ to Poverty
Momina Begum, an inhabitant of

Joldhaka Upazila of Nilfamari district,
became a member of Rural Development
Scheme of Islami Bank Bangladesh
Limited in 2006. In first phase she took
an investment of 10 thousand taka
and started nursery business with her
husband. Later she took one lac taka
investment in phasewise. Nursery
business kept expanding for their joint
efforts. At present their nursery is on
32 decimals of land where there were
30 varieties of flowers, fruits and other
wood tree seedlings. Every month
they sell seedlings worth Tk. 30,000/-
. Besides paying installments as per
schedule, she also brought solvency to
her family. Momina Begum is grateful to
Islami Bank for her success.

Meena Defeats Poverty last grocery trade came to her brain. She learned
many tricks of trade while she helped her father to
The girl had great eagerness for education. She run the shop. She has no doubt to earn sufficient
felt too good to go to school. But feeling fine is from grocery trade if she could start with handsome
not enough; one must have the ability to bear the capital. Thus Meena started to dream about setting
expenses of education. Meena Begum’s family up a grocery. She discussed her plan with her
had not have the ability to bear it. So, Meena husband. But her husband showed little interest.
Begum’s school-life ended when she enrolled in How he would show interest? It needs huge money
class five. Meena’s father was a small vendor. It to set up a grocery. From where would they get
was very difficult for him to bring regular breads & so much money? They are too poor and could not
butter for a seven-members family. arrange such amount of money.
After giving up school, Meena’s regular task was However, suddenly an opportunity surfaced. Rural
to assist his father in the shop. Hardworking Development Scheme just began its operation
Meena looked after the shop properly when her in their village. Meena became a member of the
father would go to market to buy goods for shop. scheme. She took an investment of 5 thousand
Meena would not face any problem to sell goods, taka. With this investment she set up a small
weighing and pricing. Within a short time Meena grocery. With one portion of her little profit she
become a complete shopkeeper. pays installment of the Bank as per schedule; and
invested to increase goods in the shop. After this,
Later, this experience to run a shop has played a
if any profit remained, she kept it to herself for
great role to change her life. It enabled her to lead
future use.
a solvent family life.
After paying the installments of the first phase, she
Meena begum, an inhabitant of Patnitala Upazila
got further investment from the Bank. She also
of Naogan district, got married immediate after
paid it as per schedule. Then the Bank sanctioned
she stepped in 18. Her husband was a day
her increased investment every time. In this way
labourer. There is scarcity of work in the area.
she took 25, 28, 32, 36 and 40 thousand taka
So, one cannot get rid of poverty even after hard
investment phasewise. Eventually, Meena’s shop
work. In this situation, a new member came to
began to expand. Solvency came to her family. At
their family after two years of marriage. They were
present there are goods in her shop worth about
blessed with a daughter. Expenditure of the family
taka 2 hundred thousand. Now she owns of some
increased many fold. As a result the situation
land. She got sufficient paddy from her three bigha
deteriorated. Meena started finding out a way to
land. Meena Begum now leading a happy family
get rid of poverty circle. Meena always remained
with her husband and offspring.
in deep thinking about how to increase income. At

Siddika Begum Conquers Poverty
Siddika Begum of Dinajpur
district embodies a good
example of success by
hard work, discipline and
entrepreneurship. Siddika
Begum started a poultry
farm with 50 hens in 2005.
But for lack of capital, her
farm was about to be
closed. In this situation
Islami Bank came forward
to rescue her. Siddika
Begum enlisted herself
as a member of Rural
Development Scheme,
Hazrat Umme Salma
(R) unit of Islami Bank
Bangladesh Limited.
Initially she took an
investment of 8 thousand
taka. Paying the regular installments she took more and more fresh investment from the Bank. Her business
kept expanding. She has 4 hundred hens in her farm now and collects 3 hundred eggs per day. She invested
6 lac taka to expand the farm. At present, her monthly profit is about 2 lac taka. Siddika Begum was assisted
by her husband, sister in law and brother in law to build the dreamt farm. She was all praise to Allah and
expressed gratitude to Islami Bank Bangladesh Limited for her success. Rural Development Scheme of
Islami Bank Bangladesh Limited feel contented seeing the success of Siddka Begum.
Successful RDS-Client Laxmi Rani

There is a saying that industry is a key to
success. Laxmi Rani of Panchasar became a
member of Rural Development Scheme, unit
number-06 of Munshiganj Islami Bank branch.
Initially she took an investment of Tk 5,000/- and
started producing ‘belon’, ‘piri’, ‘fuldani’ (flower
vase), ‘rehal’, dalghutuni and other children toys
from wood. Shops of mela (fair) and hat, Bazaar,
kept Laxmi Rani’s productivity. She needed no
looking back since then. Journey of changing
destiny set in. Gradually the Bank increased
sanction and she took one lac taka investment.
Now she runs a business which is worth several
lac taka. Children are continuing studies. Her one son is an MBBS student in the final year. Addressing in a
get-together ceremony of RDS branch Laxmi Rani said, “Our success would not have been possible if Islami
Bank did not stand beside us.”

Market Disclosure under Pillar-III of Basel-II
he purpose of Market Discipline in Basel II is to establish more transparent and more disciplined financial
T market so that stakeholders can assess the position of a Bank regarding holding of assets and to identify
the risks relating to the assets and capital adequacy to meet probable loss of assets. For the said purpose, this
“Disclosures on Risk Based Capital (Basel II)” is made as per Bangladesh Bank’s Guideline.
Scope of Application
Qualitative Disclosures
a. The name of the top Islami Bank Bangladesh Limited
corporate entity in the The Consolidated Financial Statements of the Bank include the financial statements of (i) Islami
group to which this Bank Bangladesh Limited (including Off-Shore Banking Units (OBUs) (ii) Islami Bank Securities
guidelines applies: Limited (iii) Islami Bank Capital Management Limited.
b. An outline of differences A brief description of the Bank (Main Operation) and its subsidiaries is given below:
on the basis of
consolidation for Islami Bank Bangladesh Limited
accounting and regulatory Islami Bank Bangladesh Limited was incorporated on March 13, 1983 as a Public Limited
purposes, with a brief Company (Banking Company) with limited liability under the Companies Act 1994 as an
description of the entities interest-free Islamic Shari‘ah based commercial bank and initiated its operation on March 30,
within the group (i) that 1983 with the permission of Bangladesh Bank. The authorized and paid up capital of the bank
are fully consolidated; (ii) respectively stood at Tk.200,000 million and Tk.12,509.64 million as on December 31, 2012.
that are given a deduction Presently the Bank operates its business through Head Office having 276 Branches (including
treatment; and (iii) that 30 SME/ Agriculture Branches) and 300 own ATM booths all over Bangladesh. The shares of
are neither consolidated the Bank are listed with both the Stock Exchanges of the country, i.e. Dhaka Stock Exchange
nor deducted (e.g. where Limited and Chittagong Stock Exchange Limited.
the investment is risk -
Subsidiary Companies
weighted).
i) Islami Bank Capital Management Limited (IBCML)
IBCML is a fully owned subsidiary of IBBL. IBCML was established in April 2010 under the
Companies Act 1994 as a Public Limited Company with Authorized Capital of Tk.1000.00
million & Paid-Up Capital of Tk.300.00 million. The Company was established as per
Bangladesh Bank Letter No. BRPD(R-1)717/2010-47 dated 07 February 2010. The
registered office of IBCML is located at 63, Dilkusha C/A, Dhaka, Bangladesh.
ii) Islami Bank Securities Limited (IBSL)
IBSL is also a fully owned subsidiary of IBBL. IBSL was incorporated in March 2010 as
a Public Limited Company under Companies Act, 1994 to carry out business of Stock
Broker & Dealer in the capital market. The overall increase of activities in Brokerage
operation plays an important role in the improvement of capital market of the country and
enhances earning capability of IBBL through corporate declaration.
Off-shore Banking Unit (OBU)
Off-shore Banking Unit is a separate business unit governed by the applicable rules &
regulations and guidelines of Bangladesh Bank. IBBL obtained permission to operate Off Shore
Banking unit in its 3 Branches under International Banking Wing.
c. Any restrictions, or other
major impediment, on - Not Applicable.
transfer of funds or
regulatory capital within
the group
Quantitative Disclosures
d. The aggregate amount of - Not Applicable.
capital deficiencies in all
subsidiaries not included
in the consolidation that
are deducted and name(s)
of such subsidiaries.

Capital Structure
a. Summary information on As per the guidelines of Bangladesh Bank, Tier-1 Capital of IBBL consists of (i) Fully Paid-
the terms and conditions up Capital, (ii) Statutory Reserve, (iii) General Reserve (iv) Non-Repayable Share Premium
of the main features of Account (v) Retained Earnings (vi) Dividend Equalization Account and (vii) Minority Interest in
all capital instruments, Subsidiaries (viii) Non-Cumulative irredeemable Preference Shares.
especially in the case Tier-2 Capital consists of applicable amount of (i) General Provision (against Un-classified
of capital instruments Investments, Off-Balance Sheet exposure & Off-Shore Banking Units) (ii) Assets Revaluation
eligible for inclusion in Reserves up to 50%, (iii) Revaluation Reserve for Securities up to 50% and (iv) Subordinated
Tier 1 or Tier 2. Debt (Mudaraba Perpetual Bond) (up to max. 30% of eligible Tier-I capital). (v) Revaluation
Reserve for equity instruments up to 10% (vi) All Other Preference Shares.
b. The Amount of Tier 1 Capital, with Break-up

As on December 31, 2012 (In
million Taka)
Particulars
Solo Consolidated
Tier-I (Core Capital)
i Fully paid-up Capital 12,509.64 12,509.64
ii Statutory Reserve 12,423.66 12,423.66
iii Non-repayable Share Premium account 1.99 1.99
iv General Reserve 130.44 130.44
v Retained Earnings 3,127.41 3,033.20
vi Minority interest in Subsidiaries 0.06
vii Non-cumulative irredeemable preference shares - -
viii Dividend equalization account 32.00 32.00
ix Other (if any item approved by Bangladesh Bank) - -
Sub-Total (Core Capital) A (i to ix) 28,225.14 28,130.99
a. Tier 2 and Tier 3 Capital

i Tier 2 capital 13,803.19 13,803.19
ii Tier-3 (Eligible for market risk only) - -
Sub Total (Suplementary Capital) B (i+ii) 13,803.19 13,803.19
b) Other deductions from capital - -

c) Total Eligible Capital (A+B) 42,028.33 41,934.18
Capital Adequacy
a. A summary discussion The Bank has adopted Standardized Approach (SA) for computation of capital charge for
of the Bank’s approach investment risk and market risk, and Basic Indicator Approach (BIA) for operational risk.
to assess the adequacy Assessment of capital adequacy is carried out in conjunction with the capital adequacy
of its capital to support reporting to Bangladesh Bank. The Bank has maintained capital adequacy ratio at 13.53%
current and future & 13.49% on the basis of “Consolidated” and “Solo” respectively as against the minimum
activities. regulatory requirement of 10%. Tier-I capital adequacy ratio under “Consolidated” basis is
9.08% and “Solo” basis is 9.06% as against the minimum regulatory requirement of 5%. The
Bank’s policy is to manage and maintain strong Capital Adequacy Ratio through investing
high rating grade investment clients. The Bank maintains adequate capital that is sufficient to
absorb all material risks associated with the Bank. The Bank also ensures that the levels of
capital comply with regulatory requirements and satisfy the external rating agencies and other
all stakeholders including depositors.

As on December 31, 2012

Particulars (In million Taka)
Solo Consolidated
b) Capital requirements for Investment (Credit) Risk: 28,220.80 28,049.59
c) Capital requirements for Market Risk 468.50 468.50
d) Capital requirements for Operational Risk 2,461.86 2,470.78
e) Total Capital Requirement 31,151.16 30,988.87
Capital Adequacy Ratio: 13.49% 13.53%

Total CAR
Tier- I CAR 9.06% 9.08%
Tier-II CAR 4.43% 4.45%
Investment (Credit) Risk

a) The General Qualitative disclosure requirement with respect to credit risk, including:
i) Definitions of past - As per the Bangladesh Bank guidelines, any Investment if not repaid within the fixed
due and impaired (for expiry date will be treated as Past Due/ Overdue.
accounting purposes): Bangladesh Bank issued Circulars from time to time for strengthening Investment (Credit)
discipline and brings provisioning. All Investments/ loans &advances will be grouped into four
(4) categories for the purpose of classification, namely (a) Continuous Investment/Loan (b)
Demand Investment/Loan (c) Fixed Term Investment/Loan & (d) Short-term Agricultural &
Micro Investment.
The above Investment (Credit) are classified as follows:
Continuous and Demand Investments/ loans are classified as:
l ‘Sub-standard’ if it is past due/over due for 03(three) months or beyond but less than
06 months;
l `Doubtful’ if it is past due/over due for 06 (six) months or beyond but less than 09
(nine) months;
l `Bad/Loss’ if it is past due/over due for 09 months or beyond from the date of expiry
or claim by the bank or from the date of creation of forced loan.
Fixed term Investment (Loans), which is repayable by installments(s) are classified as:-
a. In case of any installment(s) or part of installment(s) of a Fixed Term Loan amounting upto
Tk. 10.00 Lacs is not repaid within the due date, the amount of unpaid installment(s) will be
termed as `pass due or over due installment’. In case of such types of Fixed Term Loans:
l `Sub-standard’ if the amount of `past due installment is equal to or more than the
amount of installment(s) due within 06 (six) months, the entire Investment (jloan) will
be classified as “Sub-standard”.
l `Doubtful’ if the amount of past due installment is equal to or more than the amount
of installment(s) due within 09 (nine) months, the entire Investment (loan) will be
classified as “Doubtful”.
l ‘Bad/Loss’ if the amount of’ defaulted installment’ is equal to or more than the
amount of installment(s) due within 12 (twelve) months, the entire Investment/loan
will be classified as “Bad/Loss”.
b. In case of any installment(s) or part of installment(s) of a Fixed Term Loan amounting more
than Tk. 10.00 Lacs is not repaid within the due date, the amount of unpaid installment(s)
will be termed as ‘past due or over due installment’. In case of such types of Fixed Term
Loans:
l ‘Sub-standard’ if the amount of’ past due Installment is equal to or more than the
amount of installment(s) due within 03 (three) months, the entire Investment (loan)
will be classified as “Sub-standard”.
l ‘Doubtful’ if the amount of past due installment is equal to or more than the amount
of installment(s) due within 06 (six) months, the entire Investment (loan) will be
classified as “Doubtful”.

l ‘Bad/Loss’ if the amount of’ defaulted installment’ is equal to or more than the
amount of installment(s) due within 09 (nine) months, the entire Investment/loan will
be classified as “Bad/Loss”.
Short-term Agricultural and Micro-Investment are classified as:

If not repaid within the due date as stipulated in the Investment (loan) agreement. If the said
irregular status continues, the Investment (credit) will be classified as ‘Substandard ‘ after a
period of 12 months, as ‘Doubtful’ after a period of 36 months and as ‘Bad/Loss’ after a period
of 60 months from the stipulated due date as per Investment (loan) agreement.
A continuous Investment, Demand or a Term Investment which will remain overdue for a period
of 02 (two) months or more will be put into the Special Mention Account (SMA).
The Bank follows the specific and general provision for investment/ loan on the basis of
Bangladesh bank Guidelines issued from time to time.
ii) Description of The rates of provision are given below:

approaches followed a. General Provision: The Bank maintains General Provision in the following way :
for specific and general
allowances and 1. @ 0.25% against all unclassified loans of Small and Medium Enterprise (SME) as
statistical method; defined by the SME & Special Programmes Department of Bangladesh Bank from
time to time and @ 1% against all unclassified Investments (other than Investments/
loans under Consumer Financing, Loans to Brokerage House, Merchant Banks,
Stock dealers etc., Special Mention Account as well as SME Financing.)
2. @ 5% on the unclassified amount for Consumer Financing whereas it has to be
maintained @ 2% on the unclassified amount for (i) Housing Finance and (ii)
Investments/Loans for Professionals to set up business under Consumer Financing
Scheme.
3. @ 2% on the unclassified amount for Investments/Loans to Brokerage House,
Merchant Banks, Stock dealers, etc.
4. @ 5% on the outstanding amount of Investments/loans kept in the ‘Special Mention
Account’.
5. @1% on the off-balance sheet exposures. (Provision will be on the total exposure
and amount of cash margin or value of eligible collateral will not be deducted while
computing Off-balance sheet exposure.)
b. Specific Provision: Banks will maintain provision at the following rates in respect of
classified Continuous, Demand and Fixed Term Investments/Loans:
1. Sub-standard : 20%
2. Doubtful : 50%
3. Bad/Loss : 100%
c. Provision for Short-term Agricultural and Micro- Investments:
1. All Investment (credit) except ‘Bad/Loss’ (i.e. ‘Doubtful’, ‘Sub-standard’, irregular
and regular Investment accounts) : 5%
2. ‘Bad/Loss’ : 100%
iii) Decision of the Bank’s The Bank has put in place a well-structured Investment/Credit Risk Management Policy known
Investment (Credit) as Investment Risk Manual approved by the Board. The Policy document defines organization
Risk Management structure, role and responsibilities and, the processes whereby the Investment (Credit) Risks
Policy; carried by the Bank can be identified, quantified and managed within the framework that the
Bank considers consistent with its mandate and risk tolerance.
Authorities are properly delegated ensuring check and balance in investment operation
at every stage i.e. screening, assessing risk, identification, management and mitigation of
investment risk as well as monitoring, supervision and recovery of investments with provision
for Early Warning System and Grading of Investment clients as Blue, Green, Grey, Yellow,
Red and Brick Red.
Bank has framed Investment Policy, Investment (Credit) Assessment & Risk Grading, Approval
Authority, Internal Audit Approval Process, Investment (Credit) Administration, Investment
(Credit) Monitoring, Investment (Credit) Recovery etc. which forms integral part in monitoring
of Investment (Credit) Risk in the Bank. Status of investments is regularly reported to the Board
/Executive Committee of the Bank.

b) Total gross Investment/ Total gross Investment/ Credit risk exposures broken down by major types of
Credit risk exposures Investment exposure of the Bank are as under:
broken down by major
Particulars As on December
types of Investment
31, 2012
exposure.
(In million Taka)
Mode wise Investment
Bai – Murabaha 213,741.40
Bai - Muajjal 17,806.98
Hire Purchase under Shirkatul Melk 93,495.82
Purchase & Negotiation 7,454.20
Bai- as- Sarf (FDB)/FCD 1,823.29
Musharaka Documentary Bill (MDB) 13,224.69
Musharaka 129.06
Mudaraba 9,938.78
Bai – Salam 4,411.15
Murabaha Foreign Currency Investment 1, 983.17
Quard 8,912.18
Total 372,920.72
c) Geographical Geographical Distribution of exposures, broken down in significant areas by major

Distribution of types of Investment/ credit exposure of the Bank is shown below:
exposures, broken down
in significant areas by Particulars As on December
major types of credit 31, 2012
exposure.
(In million Taka)
In Rural Areas 50,190.82
In Urban Areas 322,729.90
Total 372,920.72
Division wise distribution of Investment/ credit exposure of the Bank are as

under:
Name of Division As on December

31, 2012
(In million Taka)
Dhaka Division 213,608.99
Chittagong Division 81,072.97
Khulna Division 31,511.80
Rajshahi Division 28,304.68
Barisal Division 3,729.20
Sylhet Division 7,160.08
Rangpur Division 7,533.00
Total 372,920.72

d) Industry or Industry or counterparty type distribution of exposures, broken down by major types
counterparty type of investment/credit exposure of the Bank is shown below:
distribution of
exposures, broken Particulars As on December
31, 2012
down by major types
of investment/ credit (In million Taka)
exposure.
Economic purpose wise Investment
Trade & Commerce 105,786.72
Real Estate 21,754.90
Transport 6,449.04
Agriculture (including fertilizer & agriculture implements) 26,713.44
Industrial investment 189,193.42
Others 23,023.20
Total 372,920.72
31, 2012
(In million Taka)
Industrial Investment
Textile- Spinning, Weaving & Dyeing 71,761.06
Steel, Re-Rolling & Engineering 21,946.44
Agro-based Industry 17,613.90
Garments & Garments Accessories 13,092.18
Food & Beverage 7,635.53
Cements Industry 1,854.10
Pharmaceuticals 2,289.24
Poultry, Poultry Feed & Hatchery 624.34
Sanitary Wares 274.56
Chemicals, Toiletries & Petroleum 3,973.06
Printing & Packaging 3,329.78
Power (Electricity) 4,162.26
Ceramic & Bricks 2,459.51
Health care ( Hospital & Others) 2,079.08
Plastic Industries 715.13
Petrol Pump & CNG Filling Station 940.45
Information Technology 549.75
Hotels & Restaurants 656.33
Other Industries 33,236.71
Total 189,193.42

e) Residual contractual Residual contractual maturity breakdown of the whole portfolio, broken down by
maturity breakdown major types of investment/credit exposure of the Bank.
of the whole portfolio,
broken down by major 31, 2012
types of investment/
(In million Taka)
credit exposure.
Repayable on Demand -
Upto 1 month
Over 1 month but not more than 3 month 105,104.74
Over 3 months but not more than 1 year 108,070.74
Over 1 year but not more than 5 years 82,343.34
More than 5 years 77,401.90
Total 372,920.72
f) By major industry or i) Amount of impaired Investment/ loans and if available, past due investment/ loans
counterparty type provided separately
The amount of classified/ past due investment of the Bank is shown below:
31, 2012
(In million Taka)
Past Due -
Special Mention Account (SMA) 16,571.77
Sub Standard 2,094.31
Doubtful 1,295.18
Bad & loss 10,823.31
Total 30,784.57
ii) Specific and General Provision

Specific and General Provisions were made on the amount of classified and unclassified
investments/ loans, Off- balance Sheet exposure of the Bank according to Bangladesh
Bank guidelines.
31, 2012
(In million Taka)
Unclassified Investment 3,935.90
Classified Investment 6,054.35
Off Balance Sheet Exposure 1,100.45
Total 11,090.70
iii) Charges for specific allowances and charge - offs during the period
During the period the specific and general provision, were made on the amount of
classified investment, Un classified Investment and Off Balance sheet exposures.
31, 2012
(In million Taka)
Provision on Unclassified Investment (60.10)
Provision on Classified Investment 3,582.28
Provision on Off Balance Sheet Exposure (19.55)
Total 3,502.63

g) Gross Non Performing Non Performing Assets (NPAs) to outstanding Investments of Islami Bank Bangladesh
Assets (NPAs) Bank stood at 3.16% as on December 31, 2012.
i) Movement of Non Performing Assets (NPAs)
31, 2012
(In million Taka)
Opening Balance 8,292.32
Additions 5,920.48
Reductions -
Closing Balance 14,212.80
ii) Movement of specific provisions for NPAs
31, 2012
(In million Taka)
Opening Balance 3,054.00
Provisions made during the period 3,724.02
Write-off/Write-back of excess provisions 581.93
Recovery from write-off 141.74
Closing Balance 6,054.35
Equities: Disclosures for Banking Book Positions
Qualitative disclosures
a) The general qualitative disclosures requirement with respect to equity risk, including:
• Differentiation between holdings Investment in equity securities are broadly categorized into two parts:
on which capital gains are i) Quoted Securities (common or preference share & mutual fund) traded in the
expected and those taken secondary market (Trading Book Assets).
under other objectives including
for relationship and strategic ii) Unquoted securities are categorized as banking book equity exposures which
reasons; and are further sub-divided into two groups: unquoted securities which are invested
without any expectation that these will be quoted in near future i.e. held to maturity
(HTM). And securities those are acquired under private placement or IPO and are
going to be traded in the secondary market after completing required formalities.
Unquoted securities are valued at cost.
• Discussion of important policies The primary objective is to investment in equity securities for the purpose of capital
covering the valuation and gain by selling them in future or held for dividend income. Dividends received from
accounting of equity holdings in these equity securities are accounted for as and when received and right to receive
the banking book. This includes when established. Both Quoted and Un-Quoted equity securities are valued at cost
the accounting techniques and and necessary provisions are maintained if the prices fall below the cost price.
valuation methodologies used, As per Bangladesh Bank guidelines, the HFT equity securities are revaluated once a
including key assumptions and week using marking to market concept and HTM equity securities are amortized once
practices affecting valuation as a year according to Bangladesh Bank guideline.
well as significant changes in
these practices. The HTM equity securities are also revaluated if any, are reclassified to HFT category
on the approval of Board of Directors.

(In million Taka)
Particulars Solo Consolidated
a) Value disclosed in the balance sheet of investments, as well as the fair value of those 54.70 54.70
investments, for quoted securities a comparison to publicly quoted share values where
the share price is materially different from fair value.
b) The cumulative realized gains (losses) arising from sales and liquidations in the - -
reporting period.
c) Total unrealized gains (losses). 34.70 34.70
d) Total latent revaluation gains (losses) - -
Any amounts of the above included in Tier – 2 capital. - -
e) Capital requirements broken down by appropriate equity groupings, consistent with the bank’s methodology, as well as
the aggregate amounts and the type of equity investments subject to any supervisory provisions regarding regulatory
capital requirements.
• Specific Market Risk 5.47 5.47
• General Market Risk 5.47 5.47
Profit Rate Risk in the Banking Book

a) The general qualitative disclosure Profit rate risk is the risk where changes in market profit rates might adversely affect the
requirement including the Bank’s financial condition. Changes in profit rates affect both the current earnings (earnings
nature of Profit Rate Risk in perspective) as well as the net worth of the bank (economic value perspective). Re-pricing
the Banking Book (PRRBB) risk is often the most apparent source of profit rate risk for a bank and is often gauged by
and key assumptions, including comparing the volume of a bank’s assets that mature or re-price within a given time period
assumptions regarding investment with the volume of liabilities that do so.
prepayments and behavior of non-
maturity deposits, and frequency of The short term impact of changes in profit rates is on the bank’s Net Investment Income (NII).
PRRBB measurement. In a longer term, changes in profit rates impact the cash flows on the assets, liabilities and off-
balance sheet items, giving rise to a risk to the net worth of the bank arising out of all re-pricing
mismatches and other profit rate sensitive position.
(In million Taka)
b) The increase Particulars 1-90 days Over 3 Over 6 Over 9
(decline) in earnings Months to Months to Months to
or economic value (or 6 Months 9 Months 12 Months
relevant measure used Rate Sensitive Assets 95,736.80 47,056.06 58,056.06 69,056.06
by management) for
Rate Sensitive Liabilities 93,890.80 42,740.70 56,425.10 67,320.40
upward and downward
rate shocks according GAP 1,846.00 4,315.36 1,630.96 1,735.66
to management’s Cumulative Gap 1,846.00 6,161.36 7,792.32 9,527.98
method for measuring
Adjusted profit rate changes (PRC) 1.00% 1.00% 1.00% 1.00%
PRRBB, broken
down by currency (as Quarterly earnings impact (Cum. Gap*PRC) 461.50 1,540.34 1,948.08 2,382.00
relevant)
Accumulate earning impact to date 461.50 2,001.84 3,949.92 6,331.92
Earning impact/Avg. Quarterly Net Profit 0.11% 0.51% 1.01% 1.62%

Market Risk
a) i) Views of BOD on trading / The Board approves all policies related to market risk, sets limits and reviews
investment activities compliance on a regular basis. The objective is to provide cost effective funding to
finance asset growth and trade-related transactions.
ii) Methods used to measure Standardized rule based approach was been used to measure the Market risk. The
Market risk total capital requirement in respect of market risk is the aggregate capital requirement
calculated for each of the risk sub-categories. For each risk category minimum capital
requirement is measured in terms of two separately calculated capital charges for
“specific risk” and “general market risk”.
iii) Market Risk Management The Treasury Division manages market risk covering liquidity, profit rate and foreign
system exchange risks with oversight from Asset-Liability Management Committee (ALCO)
comprising senior executives of the Bank. ALCO is chaired by the Managing Director.
ALCO meets at least once a month.
iv) Policies and processes for There are approved limits for credit deposit ratio, liquid assets to total assets ratio,
mitigating market risk maturity mismatch, commitments for both on-balance sheet and off-balance sheet
items and borrowing from money market and foreign exchange position. The limits
are monitored and enforced regularly to protect the market risks. The exchange rate
of the Bank is monitored regularly and the prevailing market condition, exchange rate,
foreign exchange position and transactions are reviewed to mitigate foreign exchange
risks.
As on December 31, 2012 (In million Taka)

Solo Consolidated
b) The Capital Requirements for
Profit (Interest) rate risk -
Equity position risk 10.94 10.94
Foreign exchange risk 457.56 457.56
Commodity risk. -
Total Capital Requirement 468.50 468.50
Operational Risk
a) i) Views of BOD on system to Operational risk implies the risk of loss or harm resulting from inadequate or failure of
reduce Operational Risk internal processes, people and systems or from external events. Capability to carry
out a large number of transactions effectively and accurately while complying with
applicable laws and rules constitutes operational risk management activities of the
bank.
The policy for operational risks including internal control & compliance risk is approved
by the Board taking into account relevant guidelines of Bangladesh Bank. Audit
Committee of the Board directly oversees the activities of Internal Control & Compliance
to protect against all operational risks.
ii) Performance gap of executives IBBL has a policy to provide competitive package and best working environment to
and staffs attract and retain the most talented people available in the industry. IBBL’s strong
brand image plays an important role in employee motivation. As a result, there is no
significant performance gap.
iii) Potential external events - No potential external events are expected to expose the Bank to significant
operational risk.

iv) Policies and processes for - The policy for operational risks including internal control & compliance risk is
mitigating operational risk approved by the Board taking into account relevant guidelines of Bangladesh
Bank. Policy guidelines on Risk Based Internal Audit (RBIA) system is in
operation. As per RBIA branches are rated according to their risk grading/
scoring audit procedure and required frequent audit to the Branches are operated
by the Audit Division. In addition, there is a Vigilance Cell established in the
Bank to reinforce operational risk management of the Bank and to minimize the
same. Bank’s anti-money laundering activities are headed by (Chief Anti Money
Laundering Compliance Officer) CAMLCO and their activities are devoted to
protect against all money laundering and terrorist finance related activities.
Apart from that, there is adequate check & balance at every stage of operation,
authorities are properly segregated and there is at least dual control on every
transaction to protect against operational risk.
v) Approach to calculating capital - Basic Indicator Approach is used for calculating capital charge for operational risk
charge for operational risk as of the reporting date.
As per the risk based Capital Adequacy Framework, the capital charge for operational risk is equal to 15% of average positive
annual Gross Income of the previous three years:
In line with the above, the Bank has adopted the Basic Indicator Approach for computing capital to operation risk.

Capital Requirement Solo Consolidated
Operational Risk 2461.87 2,470.78
Stress Testing
Bangladesh Bank through its DOS Circular No. 01 dated 21.04.2010 and subsequent DOS Circular No. 01 dated 23.02.2011
introduced “Guidelines on Stress Testing” wherein Stress Testing has been stated as one of the sophisticated technique used to
determine the reactions of different financial institutions under a set of exceptional, but plausible assumptions through a series of
battery of tests. At institutional level, stress testing techniques provide a way to quantify the impact of changes in a number of risk
factors on the assets and liabilities portfolio of the institution.
Bangladesh Bank also mentions in the said circular that at the system level, stress tests are primarily designed to quantify the
impact of possible changes in economic environment on the financial system. These tests help the regulators identify structural
vulnerabilities and the overall risk exposure that could cause disruption of financial markets.
Bangladesh Bank Circular No. 01 dated 23.02.2011 introduced “Guidelines on Stress Testing” wherein advised that “Banks
shall carry out stress testing in line with the revised guideline on quarterly basis i.e. on March 31, June 30 September
30 and December 31 and submitted the same to Bangladesh Bank within 30 days of each quarter end”.
IBBL has already prepared a stress testing report in line with the Bangladesh Bank’s guidelines which initially focus on “Simple
Sensitivity and Scenario Analysis” of the following five risk factors.
• Profit/ Interest rate; • Forced sale value of collateral; • Non- performing Investments (NPIs);
• Equity/Share prices ; and • Foreign Exchange rate.
The result of stress testing based on the financial performance of the Bank as on December 31, 2012 has also been completed
which shows that the bank has adequate capital to absorb minor and moderate individual shocks. However, some additional
capital may be required under major level combined shocks.

Risk Management
The Chairman addressing half yearly Managers’ Conference
of risk management of such a leading entity in

Risk Concept and Risk Management the industry, the Board of Directors has given
highest emphasis on risk governance and risk
R isk implies a situation that threatens or limits
an organization’s ability to achieve its goal.
Risk in a banking organization is the possibility
management and upgraded the unit into an
independent and separate Risk Management
that the outcome of an action or event could Wing in its 193rd meeting held on 14.05.2012.
bring up adverse impacts. Banking operations are
mainly exposed to Investment Risk, Market Risk, Formation of Core Risk Management
Operational Risk, and Residual Risk, Investment Committees along with their ToRs
Concentration Risk, Liquidity Risk, Strategic Risk,
Environmental Risk, Interest Rate Risk etc. Risk IBBL exclusively manages 6 (six) core risks
Management means a process for identifying, and has designed its own Risk Management
measuring and mitigating all sorts of foreseeable Guidelines in accordance with the guidelines
risks for sustainable growth of an organization and prescribed by the Central Bank and formed 6
its Shareholders’ value. core risk management committees which conduct
meeting periodically. The major concerns of the
committees are as under:
Formation of Risk Management Wing
To ensure effective risk management, Risk a. Investment Risk Management Committee
Management Unit was introduced in November, supervises and monitors investment
2009. The unit was functioning like a committee concentration, investment risk grading,
comprising of members from different Divisions. corporate clients rating, non-performing
In April 2011, a separate Risk Management investment, residual risk against investment,
Unit headed by a senior executive has been provision against classified investment,
formed. Later on, understanding the importance investment mix, asset quality etc.

b. Foreign Exchange Risk Management taken into account or partially taken into account
Committee oversees foreign exchange risk, while calculating Minimum Capital Requirements,
treasury, net open position, import & export quantifying the risks under pillar 2 of Basel-II, stress
business, dealing room operations and testing, Internal Capital Adequacy Assessment
anti-money laundering aspects in foreign process (ICAAP), setting capital targets that are
exchange transactions etc. commensurate with the Bank’s risk profile and
control environment etc. For adequate supervision
c. Information & Communication Technology
of capital functions and risks, Bank has formed a
Risk Management Committee monitors and
Supervisory Review Process Team (SRPT) as
supervises the risks related to data security,
stipulated in Bangladesh Bank’s guidelines.
physical security, network security, disaster
recovery, fraud, forgery, system failure and
business continuity etc. Formation of Risk Management
Co-ordination Committee (RMCC)
d. Anti Money Laundering Risk Management
Committee looks after the money laundering IBBL has also formed a strong Risk Management
activities, STR, CTR, KYC and TP related Co-ordination Committee (RMCC) in January,
compliances. The Committee also supervises 2012 comprising heads of all the risk managing
and monitors the entire transactional activities organs of the Bank which are overseen by Risk
of the Bank including money laundering Management Wing. The committee sits at least
aspects involved with foreign exchange once in a month or more when necessary. In the
transactions. meeting of RMCC, all the existing/identified and
foreseeable/potential risks issues are discussed
e. Internal Control and Compliance Risk
and make recommendations to the concerned risk
Management Committee assesses and
taking organs to address, measure and take steps
mitigates the risk related to compliance with
to mitigate the risk factors.
regulatory requirements, set rules of the
Bank, internal checking system, lapses, fraud,
forgeries, violations of the set rules etc. Existing Functional Structure of RMW
f. Asset Liability Committee (ALCO) looks

after the asset-liability risk, liquidity risk,
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Investment Deposit Ratio (IDR), deposit mix, 2IIVLWH &PW 6WUHVV
6XSHUYLVLRQ 7HVWLQJ
investment mix, gap analysis etc. under direct 7HDP &PW
guidance of the Managing Director. 6WUHVV ,QY
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IBBL has constituted Stress Testing Committee 0JW&PW
and Assessment of Capital under Basel- ,&& ,&7

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II Accord Committee to look after the Stress &PW )([5LVN &PW
0JW&PW
Testing & Basel-II related risk issues. Addressing
the Investment Risk, Market Risk, Operational
Risk and other risks associated with the banking
operations, IBBL has been linking its risk profile Risk Management Areas
with the capital which is the major risk absorbing
tool. Currently the capital adequacy of IBBL is IBBL has already introduced all the guidelines
13.49% (solo basis) wherein the industry average for managing the risk areas in accordance with
is only 10.46%. the guidelines/instructions given/prescribed by
Bangladesh Bank which are under:
IBBL is committed to continuous improvement
of Bank’s internal procedure for assessing the
Asset Liability Risk Management
specific risk situation, ongoing adjustment and
further development of new methods of risk To deal with Balance Sheet Risk, IBBL has
management and internal control, covering constituted a dedicated committee, called the
external factors and risk areas which are not Asset Liability Committee (ALCO) comprising

of the senior officials Bank to make important arise in the form of single name concentration
decisions related to the Balance Sheet, Liquidity or industry concentration.
& Profit Rate risks of the Bank.
• Country Risk - The risk of loss arising when
The Asset Liability Committee monitors Balance a sovereign state freezes foreign currency
Sheet Risk and Liquidity Risk of the Bank. The payments (transfer/conversion risk) or when
ALCO generally meets at least once month and it defaults on its obligations (sovereign risk).
reviews liquidity requirement, the maturity of Assets Political unrest, degradation of internal law
and Liabilities, Deposit and Investment pricing and order are also included in country risk.
strategy/transfer pricing, Sensitivity of Assets and In such situation, both entrepreneurs and
Liabilities, Key Management Indicators and the the banks are discouraged in investment
Liquidity Contingency Plan of the Bank. In every activities.
ALCO meeting, the key points of the discussion
• Environment Risk-The risk of environmental
are recorded and the action points are highlighted
calamities which arise while banks deploy its
to ensure implementation. As a part of regulatory
fund to industry, trade and service sector.
requirement, the management reviews the ALM
Manual and its components regularly. Quarterly In this context, Investment Risk Management
position of Investment-Deposit Ratio (IDR) of the Committee (IRMC) of the Bank is entrusted with the
Bank is given below: duties of maintaining asset quality, assessing risk
in investment to a particular customer, appraising,
4XDUWHUO\,'53RVLWLRQ sanctioning investment, formulating policy/strategy
for investment operations, sectoral assessment,

salvaging sick units, nursing the running

units, diversification of its investment portfolio,
consideration of environment impacts while
financing etc. The Investment Risk Management

Committee is also entrusted to comply with the

CRM Guidelines, monitoring & updating the
bank’s investment policy. Moreover, the committee
analyzes the investment portfolio on the basis of

,'5 Basel Guideline and attempts to restructure the
investment portfolio. The rating status of corporate
investment clients of IBBL is as under:
Investment Risk Management
Amount of No. of Rated Risk
Investment Risk is one of the major risks faced Corporate Clients Amount Weighted
by the bank. This can be described as potential Investment Rated Asset (RWA)
losses arising from the failure of counterparty to
273,344.57 931 234,711 123,246
perform according to agreement with the Bank.
The failure may result from unwillingness of
the counterparty or decline in his/her economic

condition, market situation etc. With each and
every coin of investment, there is an involvement
$PRXQWLQPLOOLRQ
of risk. In broad sense, credit risk includes:

• Investment Default Risk - The risk of loss
when the bank considers that the obligor is
unlikely to pay its investment obligations in full
or the obligor is more than 90 days past due

on any material investment obligation;
2XWVWDQGLQJ
• Concentration Risk - The risk associated with
any single exposure or a set of exposures with 5:$
the potential to produce large enough losses

to threaten a bank’s core operations. It may

In million taka volume of foreign trade and remittance business
of the country which is growing very rapidly in a
Risk Weight Investment Amount RWA
better & efficient way with international standards.
20% 33,700 6,740 In 2012, IBBL faced hindrances in achieving
50% 169,122 84,561 import and export business target due to adverse
fluctuation in foreign exchange rate.
100% 31,779 31,779
Foreign Exchange risks are measured and
150% 110 165
monitored by Treasury Division. Treasury Division
Total 234,711 123,246 consists of separate Front Office, Back Office and
Mid Office. The Treasury Front Office (Dealing
Amount in % to General Room) independently performs the deals and the
NPI
million tk. Investment Treasury Back Office is responsible for verification
of the deals and passing of their entries in the
Overdue 9,611 2.58%
books of accounts.
Classified 14,213 3.81%
The Foreign Exchange Risk is minimized through
Written Off 3,018 0.81% proper Market analysis, Real time pricing of
Foreign Exchange and Money Market product,
Fixation of different market related limits (Daylight,
4XDUW\HUO\6WDWXVRI13, Overnight, Stop Loss and Management Action
Trigger) and Counter parties Credit limits set by the

$PRXQWLQPLOOLRQ7N

management and ensure adherence of the limits
by the Treasury Front Office. All Foreign Exchange
transactions are revalued at weighted average

exchange rate as provided by Bangladesh Bank

at the end of each month. All Nostro Accounts are

reconciled regularly and outstanding entries are
2YHUGXH
&ODVVLILHG reviewed by the management for its settlement/
:ULWWHQ2II recompilation. The open position maintained by
the bank at the end of day is within the stipulated
2YHUGXH &ODVVLILHV :ULWWHQ2II
limit prescribed by the Bangladesh Bank.
Moreover, Investment Administration Division Internal Control and Compliance Risk

(IAD) and Offsite Supervision Teams in the Bank’s
Management
Investment Wing/Divisions are in place to monitor
continuously the development of business/projects Operational loss may arise from errors and frauds
from beginning and ongoing situations to mitigate due to lack of internal control and compliance.
the Investment Risk of the Bank. Thus, the Bank’s Failure of Internal Control system may invite
Investment Risk Management activities have been various risks for banks and jeopardize bank’s
designed to address all these issues. interest. Internal Control is a management process
designed to achieve effectiveness and efficiency
Non-performing assets of the Bank increased a bit
of operations, reliable financial reporting, and
in 2012 owing to imposition of BRPD Circular No.
compliance with laws and regulations. With a
14 and 15 dated 23.09.2012.
view to overcome such lapses and verification of
asset quality, quality of customer services, overall
Foreign Exchange Risk Management security arrangement, operational efficiency and
Foreign Exchange Risk is defined as the adverse regulatory issues as guided through different
exchange rate movement in the market. The Bank circulars, manuals from Head Office and other
is exposed in profit rate risk and settlement risk on regulatory bodies, IBBL organizes its management
account of its foreign exchange business. Foreign through Internal Control & Compliance Wing
Exchange businesses are involved in import, consisting of three Divisions namely (i) Audit
export and remittances including other auxiliary & Inspection Division (ii) Compliance Division,
services. IBBL is dealing with a substantial and (iii) Monitoring Division to develop sound,
sustainable and secured growth of the Bank.

Organizing Anti Money Laundering program as lead Bank
The Audit Committee of the Board subsequently for the event of the aforesaid programs on Anti-
reviews the lapses identified by the Audit & Money Laundering and Anti Terrorism Financing.
Inspection Division, Bangladesh Bank and other They also ensure that the Bank complies with
regulators. The key points of the reports presented the Anti Money Laundering and Anti Terrorism
by the concerned division are discussed in the Financing Legislations. Anti Money Laundering
meeting of the Audit Committee. Subsequently Compliance Units are also functioning under the
appropriate actions are taken as per decisions leadership of the Branch Anti-Money Laundering
of the said Committee for protecting the Bank’s Compliance Officer (BAMLCO) and Zonal Anti-
interest. Thus Internal Control & Compliance Money Laundering Compliance Officer at Branches
(ICC) system of IBBL always plays active role in and Zonal Offices respectively, who independently
mitigating operational risk and contributes in the review the transactions of the accounts to verify
process of being a fully compliant bank. Suspicious Transaction Report (STR).
A Manual and Policy Guideline for prevention of

Money Laundering Risk Management money laundering was developed and approved
Money Laundering Risk is defined as the loss of by the Board of Directors of the bank. IBBL has
reputation and expenses incurred as penalty for introduced uniform Account Opening Forms, KYC
being negligent in prevention of money laundering (Know Your Customer) profile, and TP (Transaction
and terror financing. In order to ensure the best Profile) and CTR (Cash Transactions Report) in
corporate governance practices and aiming the bank as per instruction of Bangladesh Bank.
at protecting the Bank and its Employees, IBBL has already issued circulars from time to
Shareholders, Management and Customers, time for providing necessary instructions for
IBBL is committed to comply with all the applicable prevention of money laundering activities and also
Rules of the Anti Money Laundering. for combating financial terrorism. Moreover, IBBL
has conducted a number of Training Sessions/
For mitigating risks, the bank has formed Central Workshops to create awareness and to develop
Compliance Unit (CCU) under the leadership of the skills of the officials for identification of
the Chief Anti-Money Laundering Compliance suspicious transactions.
Officer (CAMLCO) at Anti-Money Laundering
Department, Branches Control Division in Head IBBL has exclusively completed the KYC
Office. An independent CCU of the Bank is procedure of legacy accounts (accounts
performing supervisory and monitoring activities opened before April 30, 2002) by December,

Central Server of the Bank
2009 before one month of deadline fixed by In line with the Central Bank Directives, the
the Bangladesh Bank. To establish fruitful Bank has re-drawn its own ICT Policies for its
Anti-Money Laundering drive at Branch level, operations and services. Under these policy
IBBL introduced ALM rating systems through guidelines, a security policy has also been
self-assessment report & independent testing worked out. To adhere to what is laid down in
procedure as per instruction of Bangladesh the policy, the implementation has been made
Bank. through Active Directory Service (ADS), Password
Policy, Kerberos Policy, Audit Policy, Group
Information & Communication Policy, User Rights, Permission Policy etc. To
secure network resources from public network,
Technology Risk Management
the Bank has introduced Virtual Private Network
The Bank has adequately addressed an (VPN), Access Control List (ACL), IP Filtering
Information & Communication Technology (ICT) and TCP/UDP service blocking through router
Risk Management which ensures ICT security and firewall devices. It has already centralized
functions and operations in a more effective the administrative control to access the Network,
manner. It is an in-depth exercise and continual Mailing system and Internet. IBBL has introduced
process. The ICT Risk Management exercise Disaster Recovery Site (DRS), Data Center as
consequence of Business Continuity Plan (BCP)
mainly include minimizing financial and image
of IBBL and Trained the officials to cope with any
loss to the institution in such events as natural
contigencies. The Bank always tries to employ
disasters, technological failure, human errors etc.
sufficient and qualified technical staff to create a
The Bank uses own developed Core Banking
congenial atmosphere for safe banking business
Software to perform all types of transactions
through automation.
including Local/Online/Internet in a secured
way. To take care of its core banking system, a
separate security module has been incorporated Other Major Risks Associated with the
in the software which manages different roles for Business Activities of IBBL
different users. All financial transactions can be Bangladesh Bank vide their BRPD Circular no.
tracked for future audit perposes. The Bank uses 13 dated 21.04.2010 forwarded a guideline on
Central Data Centre travelling through network Supervisory Review Evaluation Process (SREP).
uses encryption and descryption mechanism. According to principle 1 of the Guideline on

Supervisory Review Process, Banks should internal control, compliance requirements or
have a process for assessing their overall capital corporate governance practices that results in
adequacy in relation to their risk profile and a human error, fraud, failure, damage of reputation,
strategy for maintaining their capital levels. In delay to perform or compromise of the Bank’s
accordance with the same, IBBL has an adept interest by employees.
Supervisory Review Process Team (SRPT) and
Appropriate Internal Control measures are in place
this SRPT follows a comprehensive Internal
at IBBL to address operational risk. Internal Control
Capital Adequacy Assessment Process (ICAAP)
& Compliance Wing (ICCW) assesses operational
which considers the following risk areas in addition
risk across the Bank as a whole and ensures that
to aforesaid core risk areas to enable the Bank
an appropriate framework exists to identify, assess,
Management to assess, on an ongoing basis, the
and manage operational risk. IBBL also develop
risks that are inherent in its activities and material
policies, processes and procedures for managing
to the institution:
operational risk and continuous vigilance against
a) Market Risk leakage by identifying, assessing, measuring,
b) Operational Risk managing and transfer of operational risk resulting
from inadequate or failed internal process, people
c) Liquidity Risk and system or from external events.
d) Investment Concentration Risk
e) Residual Risk Residual Risk
f) Business Risk IBBL follows the following policies to reduce or

minimize the residual risk:
g) Profit Rate Risk in Banking Book
a) Documentaion are done properly and legally
h) Risk under Islamic Banking
to minimize the documentation risk;
i) Any other Risks identified.
b) Valuation of collaterals are done accurately
and the liquidation value of collaterals are
Market Risk considered to minimize the legal risk or
liquidity risk;
The following policies are followed by the Bank to
reduce or minimize the market risk: c) Residual value of collaterals are considered;
a) Investment in shares & securities are made d) In case of guarantee, refusal or delay by
considering the risk weight thereagainst. guarantor to pay are considered.
However, to maintain minimum capital charge,
equity position are observed on reporting To avoid complexity and hindrances for recovery of
date; investment by disposal of collaterals, utmost care
is taken in accepting collaterals before sanctioning
b) Foreign exchange position is monitored to investment. The Bank’s Investment Administration
maintain at minimum lelvel; Division (IAD) looks after these issues.
c) The Asset Liability Management Committee
(ALCO) of the Bank regularly meets to Liquidity Risk
assess the changes in profit rate risk, market
Liquidity risk management of IBBL is well
condition and asset liability maturity gap
managed by the Treasury Department considering
analysis, pricing of products and thereby
the availability of fund to meet its investment
takes effective measures to monitor and
requirement. In addition the Asset Liability
control profit rate risk. To manage the market
Management Committee (ALCO) of the Bank
risk IBBL arranges the funding facilities with
meets frequently to oversee and administer the
competitive profit rate to match with maturity.
mismatches in liquidity, if any, and recommends
for mitigating and encountering the risk.
Operational Risk
Month-wise position of surplus liquidity of the Bank
Operational Risk is the potential loss arising from in 2012 is as under:
breakdown in bank’s systems and procedures,

(In million Taka) Profit Rate Risk in the Banking Book
To reduce profit rate risk in the Banking book, the
$YDLODEOH6XUSOXV/LTXLGLW\ following measures are usually taken by IBBL:
a) Profit rate is fixed up considering the

expectation of the depositors;

b) Profit are associated with the instruments and

portfolios, maturities and the rate index used

for re-pricing;

c) Gap analysis has been introduced in finalizing

the profit rate;

6XUSOXV/LTXLGLW\ d) Accommodation through sharing profit with
the Mudaraba Depositors (by giving more
than 65% of the investment income, when
Investment/Credit Concentration Risk necessary).
IBBL adopts the following policies to reduce or

minimize the Investment Concentration Risk:
Risks under Islamic Banking
a) Fiduciary Risk: Where Mudarabah Depositors’
a) Risk of default is important in concentration
funds are commingled with the Bank’s own
risk. To minimize the investment concentration funds, the bank shall ensure that the bases for
risk to diversify the investment by size to asset, revenue, expense and profit allocations
reduce the classified investment. In 2011, are established, applied and reported in a
the rural investment of IBBL was 12.93% of manner consistent with the Bank’s fiduciary
the total investment of the Bank. In 2012, the responsibilities;
rural investment became 13.83% of the total b) Rate of Return Risk: Banks are exposed to
investment of the Bank. In 2011, the urban rate of return risk in the context of their overall
investment of the Bank was 87.07% of the total balance sheet exposures. An increase in
investment which has increased to 86.17% benchmark rates may result in the Mudaraba
of the total investment. Risk Management depositors having expectations of a higher
Wing has been delivering continuous efforts rate of return. Rate of return risk differs from
risk in that banks are concerned with the
to ensure diversification of the investment
result of their investment activities at the end
portfolio;
of investment holding period. Such results
b) Special attention is drawn to investment cannot be pre-determined exactly;
in SME sector and investment secured by c) Displaced Commercial Risk: Banks may be
residential property and commercial real under market pressure to pay a return that
estate; exceeds the rate that has been earned on
assets financed by the Mudaraba depositors
c) Whether the Bank’s investment is when the return on assets is under performing
concentrated in areas of higher or lower than as compared with the competitors’ rates.
average risk based on their volume, type, In such case, banks may decide to waive
amount and industry; their rights to part or its entire mudarib
share of profits in order to satisfy and retain
d) Reviews the result of stress tests to identify its fund providers and dissuade them from
and respond to potential changes in market withdrawing their funds.
conditions that can adversely impact the
Asset Liability Management Committee
bank’s performance.
(ALCO) of IBBL regularly meets to assess
The Bank’s Investment Administration Division the fiduciary risk, rate of return risk and
(IAD) is exclusively working on the above issues. displaced commercial risk if any in IBBL, and

recommends mitigating and encountering the economic & market scenario closely, assesses,
above risks; analyzes, evaluates, quantifies & searches out the
ways to mitigate those risks. RMW also arranges
d) Sharia’h Compliance Risk: IBBL is always
meeting with the conveners of the operational
aware about compliance Sharia’h rules in all
risk management committees on monthly basis
of its operations. Since IBBL is performing in
regarding steps taken to minimize the risks and
the dual banking system, some transactions
policy taken to keep the Bank sound & sustainable.
seem doubtful. The independent Sharia’h
The Wing submits report quarterly to the
Board keeps keen observations on the day to
Department of Off-site Supervision, Bangladesh
day transactions of the Bank and they declare
Bank enclosing previous three minutes of the
all the doubtful income as suspended which
meetings along with related papers. The Wing
cannot be brought into the total income of the
also submits report to the CEO/MD and the Audit
Bank.
Committee of the Bank as per Terms of Reference
Concluding Remarks of the RMU provided by Bangladesh Bank
regarding areas to be improved in accordance
The Risk Management Wing (RMW) of the Bank
with the prescribed policy and adopted strategies.
continuously monitors the risk components arises
from day to day banking activities, changes in

ICT and Automation
Inauguration of an ATM Booth
IT-enabled Bank to an IT driven One The Bank has also taken initiatives to offer
customers new and innovative ways of banking.
S ince its inception, IBBL has focused on

the use of Information Technology to ease
Banking hassles and to offer smooth services to
It has Remittance Card for beneficiaries of foreign
remittance earners, long existing ATM (debit) Card
for on the spot cash withdrawal, and Electronic
customers. Whenever a new technology arrived Fund Transfer (EFT), SMS Banking, & Internet
in the banking arena, the Bank immediately took Banking as alternative channels of delivery and
sleps to adopt it for making banking transactions payment. Most importantly, to provide financial
simpler & easier than before. access to the poor and unbanked population
of the country, the Bank has launched Mobile
In wake of that, the Bank now boasts of possessing
Financial Services which will fulfill all requirements
self-developed Core Banking System, Alternative
of financial inclusion as envisioned by the
Delivery Channel Systems and some enterprise
Government of Bangladesh.
resource planning (ERP) systems. It has the
largest online banking network in the country. Its
ATM network is extended across the whole country Mobile Financial Services-Islami Bank
with access to other renowned ATM Networks mCash
making the reach even bigger. The Bank is fully
Islami Bank mCash, a newly started Mobile
geared up with state of the art IT infrastructure
Financial initiative of IBBL, is already on track with
and setups like Data Center, Disaster Recovery
plans to offer an enabling environment for all to
Site, and Contact Center to meet up regulatory become banked and perform small scale banking
requirements as well as to be line with the world transactions. It has been specially designed so
trends towards technology. that any mobile phone and any carrier can be used

Inauguration of Islami Bank mCash Service
ensuring maximum reach. Also apart from the customers and other enquirers’ latest information
Bank branches, the service footprints of mCash against their queries either directly by a human
have been extended by including individual agent or by the system through Interactive Voice
agents and other network based agents all over Response (IVR). As part of the Contact center
the country to make it available even in the most setup, all the Branches, offices and ATM booths
remote area. have been equipped with IP Phones through
which communications are being made at lower
The underlying System of mCash has been
costs and higher availability.
developed by IBBL itself to cut huge setup cost
and to incorporate present and future business The IVR system of the Contact Center is also
requirements easily and cost effectively. With used in phone banking and mobile banking where
mCash IBBL is planning to include vast segment customers can perform banking transactions on
of the population, especially the unbanked their own without intervention of any support and
population into the fold of basic banking services service staff.
with comfort and trust.
Currently, a range of exciting services like Cash-in, Card Based Services-IBBL ATM Network
Cash-out, person to person Fund transfer, Mobile
IBBL started providing outsourced ATM based
airtime recharge, fund transfer between CBS and
service to its customers in 2001. In 2009, the
mCash accounts and installment payment (MSS,
Bank established its own ATM system and started
MMS, Hajj, etc.) are being provided to the mCash
building its ATM Network. Now it has 300 own
customers.
ATMs situated all across the country. The number
of the Bank’s existing ATM card holders now
Communications made Easy- stands at more than 5 lacs. They have options to
IBBL Contact Center use all those IBBL ATMs & 1520 ATMs of other
ATM Networks.
To provide smart, appropriate, state of the art
support services to clients, Branches and Head On 2012, the ATM switch has been replaced with
Office of IBBL concurrently IBBL has recently a state of the art one to offer more features and
established its own Contact Center. It is equipped facilities to customers. The Bank is on the verge
with most modern call center facilities to offer of rolling out VISA (World’s largest retail electronic

payment network) enabled debit cards and Wings/Divisions/Departments of Head Office.
Khidmah Cards (Shariah compliant Credit Card of Recently, the Data Center (DC) has been extended
IBBL) which can be used at any global e-outlets to incorporate new systems, hardware and other
(ATMs and/or POS). components.
Recently, IBBL has also set a number of Islami The Bank also has a Disaster Recovery Site (DRS)
Bank Deposit Machines (IDM) at different places at a separate place in line with the guidelines
offering cash deposit facility to customers where of Bangladesh Bank (Central Bank). The DRS
they deposit cash inside an envelope and enter acts as a replication establishment of the Bank’s
the envelope in the IDM. Designated officials then existing Data Center.
collect, count and credit the cash to respective
client accounts during assigned hours. Internet Banking (iBanking) and SMS
Banking
Heart of IBBL-eIBS (Core Banking
To take banking services to the doorsteps of
System)
customers, IBBL put emphasis on alternate delivery
Based on open source technologies and most channels like iBanking and SMS Banking. The
secure Database Management System, ORACLE, Bank offers a range of Internet Banking (iBanking)
eIBS is the in-house developed fully fledged Core & SMS Banking Services to its customers. New
Banking System of IBBL-the first and only Bank services have been added to the services. To
in Bangladesh to build up and possess such name a few, ‘iTransfer’ & ‘iRecharge’ using IBBL’s
system of its own. It has all banking modules iBanking have become very popular. The former
fully integrated within it running seamlessly at all is used to transfer fund from any of a customer’s
branches. IBBL account to any other IBBL whereas the latter
is used to recharge talk-time to any postpaid or
As part of next level integration, different other
prepaid mobile numbers of all Telecom Operators
systems like Mobile Banking, Internet Banking,
of Bangladesh.
SMS Banking and Phone Banking have been
integrated with eIBS. Now customers enjoy doing Through SMS push service, foreign remitters
banking transactions from one system to another and beneficiaries can automatically receive
effortlessly and with great comfort. informative SMS in their mobile phones once a
remittance amount is credited in their accounts
On-line Banking or drawn by the beneficiary. Through SMS push-
pull service, any client can perform informative
Having the largest online banking network in the SMS Banking (i.e. latest balance information, last
country, IBBL has also equipped all 276 branches three transactions, etc.) using his/her mobile from
with dual connectivity using Fiber Optics and Radio anywhere which also reduces customer’s hassles
Links to provide flawless ‘Any Branch Banking’ to of visiting branches premises.
clients. As a result, both the revenue and number
of online transactions have showed positive In addition, the Bank has by now implemented
growth every year. On an average, nearly 35,000 SMS notification during cash withdrawal of certain
transactions per day are now performed by the amount from ATM and very soon SMS notification
branches with volume of about Tk. 6,700 millions for cheque encashment will be implemented.
using on-line remote deposits and withdrawals.
Management Information System (MIS)
Business Continuity Planning of
To allow instant access to necessary information
IBBL-Data Center (DC) & Disaster
to all stakeholders of the Bank Management, IBBL
Recovery Site (DRS)
has developed a strong Central Management
The largest in the banking sector of Bangladesh, Information System (MIS) for the Bank. It contains
IBBL Data Center automatically uploads and Branch Accounts related, General Ledger related,
stores data from all the branches round the clock. Zone level, Central level and other important
This data are used as backup for emergency information for supervising, monitoring and
situations and report preparation for different decision taking issues of the Management & also

Agreement with Airtel for mCash Service
for regulatory compliance. Already Branch MIS, of IBBL where BACH is in operation. Using the
Zonal MIS and consolidation of Central MIS with own BEFTN system, all branches of IBBL are
more than 300 formats have been developed. capable of sending and receiving electronic
Other developments include: Rationalized Input funds through BEFTN. Now, huge amount of third
Templates (RIT) for Central Bank Enterprise Data bank remittance and dividend/refund warrant are
Warehouse (EDW), Centralized Payroll System, paid everyday using this BEFTN system which
Shariah Auditing and Monitoring System & Annual is also capable of providing person to person
Closing reports related to Deposit/Investment/ (P2P), business to business (B2B), and person to
Foreign Exchange. Steps have been taken for business (P2B) payments.
development of Branch MIS in Centralization
approach as well to be in line with the future Enabling the Bank Human Resources
Centralized Banking System.
with IT skills, Training and
Technologies
Implementation of Bangladesh
Automated Clearing House (BACH) IBBL has always taken initiatives to equip its beage
workforce with modern IT skills and equipment.
of Bangladesh Bank
Already, under ‘one man one PC’ strategy set by
In compliance with the Bangladesh Bank’s the Management, all officers and executives have
instructions to automate clearing of interbank been provided with PCs. This has paved way
instruments (including cheques and wire transfers), for productivity and promptness in the working
namely Bangladesh Automated Clearing House environment. Additionally, laptops were provided
(BACH), IBBL developed two separate systems- to selected Zonal Heads and Divisional Heads to
Bangladesh Automated Cheque Processing enhance communication and correspondence.
System (BACPS) and Bangladesh Electronic And all MC and EC members have been equipped
Fund Transfer Network (BEFTN). Through with tablet PCs (iPad) so that they can perform
implementation of the BACPS system, same quick, informed perusal and decisive actions
day clearing of instruments is now possible. The during the Meetings in paperless manner.
System has been deployed to 243 branches

IBBL is keen on preparing its workforce with IT Plan 2013
adequate and latest IT training. For that,
trainings are organized at different levels and by
Centralization Initiatives-CBS, CIPPS
different authorities. The Islami Bank Training
and Research Academy (IBTRA) prepares their
and RDS
courses incorporating sufficient & related IT The Bank’s ultimate goal has been centralization
classes. Apart from that, the ICT Wing of the Bank of the CBS (eIBS) and other systems to achieve
arranges Zone wise training programs on regular single point operability for all services and
banking services or special training programs supports. For that separate centralization projects
whenever a new service/technology is introduced i.e. Implementation & migration of CBS from
by the Bank. distributed to central approach, Centralization
of RDS Software, & development of Centralized
Green Banking through Automation Investment Proposal Processing System (CIPPS)
and Reduction of Paper Usage being run. The CIPPS will be of special interest as
it will make the system of appraising Investment
Respecting the Bank’s commitment to Green proposal efficient in terms of speed.
Banking, steps have been taken to reduce the
usage of papers in all working paradigms of the
Restructuring of WAN Architecture &
Bank. Already the proceedings of the MC and EC
have been automated by implementing IPad using
Establishment of Hot DRS
wi-fi connectivity. A strong Infrastructure is the backbone and
key to building and maintaining a sound IT
Integration with the National Payment based business system. To cope with the ever
Switch (NPS) increasing needs of upcoming services, IBBL
is restructuring its existing WAN architecture
IBBL is one of the 17 banks which were selected by with provision for alternative connectivity, larger
Bangladesh Bank for the first phase implementation processing capacity, storage and more options
of National Payment Switch Bangladesh (NPSB). for backup and restoration. The restructuring
Required connectivity and hand shaking between of the Wide Area Network of the Bank will be
IBBL Switch and the NPS of Bangladesh Bank completed by the first quarter of 2013. In addition,
are being done. Once complete, IBBL customers establishment of a Hot DRS (Disaster Recovery
will enjoy Inter-Bank electronic transactions as Site) is also in progress which will contain both
well as facility to use ATMs and POS & other data and system replica of all major services and
electronic Banking terminals which will empower will have capability to automatically start operating
the customers to have Any Card-Any ATM/POS- if the main systems crash.
Any Bank facilities.
Paperless Management of Events and
Capacity Building for Shari‘ah Business Systems
Supervision
Continuing the automation initiatives, plans have
Being a Shari‘ah based bank, IBBL must ensure been taken to automate other Meetings. Also
proper compliance in every operations and development of required system for automation
proceedings of the Bank. In line with that, all of Wings/Divisions like Internal Control &
Shari‘ah Supervisors (Muraqibs) have been Compliance Wing/Law Department, etc. is going
equipped with automated system. This has shown on. Eventually, all business and official processes
remarkable improvement in monitoring Shari‘ah and procedures will be automated to minimize
compliance through off site supervision and has paper usage and optimize green banking.
also helped to create awareness about reduced
cases of Shari‘ah lapses.

Development of Enterprise Resource system will be introduced in mCash so that
Planning (ERP) uneducated, unbanked population of the country
can be included in formal financial services easily.
In the past, IBBL has developed various ERP
systems including HRM, Payroll, IT audit, etc.
Taking the Card Services Forward
to fast track business processes. The trend
will continue in 2013 as well with development Emphasis will be given to another most important
of Control and Compliance Tracking System, service portfolio, Cards Services. In 2013, IBBL
building of Data Warehouse and Data Archival have plans to Implement Islami Shari‘ah Based
System, and development of Document Archival Credit Card, “Khidmah”. Other types of cards i.e.
System (Content Management), etc. VISA enabled Debit Card, Travelers’ Card & Pre-
paid card will be rolled out soon. Also installation
Extension of Mobile Financial Services of more Islami Bank Deposit Machines (IDM) will
be completed this year increasing the reach and
(mCash)
option of depositing cash and payment instruments
In the coming year, full efforts will be geared to for customers. In addition, implementation of
further extend bank’s innovative Mobile Financial Point of Sales (POS) will be done throughout the
Services, mCash. As part of the extension plan, country for services in the Branches and by RDS
applications of mCash and other systems will be officials adding value to our existing services to a
integrated with ATM to offer more expressive points great extent.
of cash withdrawal. Also POS based biometric

Corporate Communication and Business Promotion
Meet the Press
Public Relations performance. In comparison to the previous days

and with development of the Bank’s business, the
P ublic Relations is an immense need for

reputation of any organization. Branding
creates an image and a perception that capture the
Department is performing in a vibrant manner with
visible multidimensional publicity measures.
mind of the customers and hereby it is essential IBBL has divided PR activities in internal and
for all products. IBBL has moved forward with external ways. IBBL internal publicity measures
the visionary image of conveying the message of includes publications of different magazines,
excellent service in the heart of the people. Public journal and different types of books and distributing
Relations Department in IBBL was created mainly them among our workforce for updating them
to fulfill this purpose. Since its inception, the about the Bank’s position. External publicity
Department has been involved in many successful includes coverage in different print, electronic
ventures that helped to create a new image and & social media and making close and intimate
positive perception among our valued clients. relations with the outside people.
Imbued with the sky touching view and The year 2012 was a year of landmark for Public
leadership of the top management, Public Relations of the Bank. It added a new dimension to
Relations Department has been operating to th Bank’s efforts to expand exposure and publicity
meet the needs of the time. It worked with high activities. CSR activities of the Bank were given
enthusiasm to develop the standard and image priority in all the publicity activities round the year.
of the Bank from the very beginning of its journey. Preaching of moral and ethical values also received
With their ceaseless efforts in communicating due priority in the publicity process for different
with the media and common people over the promotional items. New ideas are being developed in
time Public Relations Department has gained a creating television commercials and documentaries.
momentum in gradual development in size and Throughout the year Public Relations Department

accomplished various activities regarding publicity, Advertisement
publication, public relations and event management.
The department achieved appreciation from the Advertisements of various types and length were
people in and beyond the Bank. published in print & electronic media round the
year. Around 113 official advertisements including
financial statement, balance sheet, AGM notice,
Media Coverage
tender and recruitment notice; and 162 promotional
Media coverage for the Bank has visibly increased advertisements like branch opening and ATM,
in the year. IBBL was in the leading position months long campaign programs, product
regarding coverage of news in print and electronic advertisement and on occasions of newspapers &
media along with web based news sites. Each TV channels’ founding anniversary were publicized.
month, the Bank got an average of 3325 column About 486 issues of different magazine, periodicals,
inches coverage on various events in the national souvenirs published our advertisements on
dailies and weeklies. News of all the important different products and themes. Design of different
programs of the Bank are being published in almost advertisement of the Bank was improved.
all the recognized newspapers. Besides, articles
The Bank opened a new dimension in its publicity
and features on Islamic Banking prospects and
by branding business and international news
IBBL products along with our top managements’
segment in different television channels by floating
interviews were published in reputed Dailies.
TV Commercials round the year. The Bank also
Globally renowned Gulf News and Reuters
sponsored TV magazine programs.
interviewed the Bank’s Managing Director. Almost
every leading news paper of the country published
the Gulf News interview. Sponsorship & Participation
Coverage in the electronic media also increased The Bank earned huge publicity in the year 2012
to a new height. The Bank got around 125 minutes sponsoring the National School Football Islami
of news coverage each month which also show Bank Tournament, an event unprecedented in
an increasing trend. Almost all the TV channels the country’s grass root sport history. About 5,000
telecast news of the Bank on different programs school teams comprising one lakh students from
round the year. all over the country participated in the tournament
held in 480 upazilas. Positive image of the Bank
was created among the schoolmen, parents and
Reception program in honour of AHM Mustafa Kamal, MP, the newly elected Vice President of International Cricket Council

Seminar and Iftar Mahfil
sport enthusiasts. During the year, the Bank 2012 captured large visitors and was awarded the
sponsored East Zone Team in the first time best pavilion prize.
franchisee-based longer version national cricket
tournament namely Bangladesh Cricket League. Other Publicity
The Bank sponsored a number of organizations The Bank continued road side publicity with
and forums on the occasion of their conference, billboards at Banglamotor, Ruposhi Bangla point,
convention, seminars and other celebrations. Gulishthan, Bangabhavan gate, Matijheel Shapla
IBBL participated and sponsored trade fair, Chattar and Bijoy Sarani. Digital board displays
tourism fairs, SME and other fairs round the were arranged on the occasion of different
year. The Bank’s attractive pavilion of aesthetic national programs and fairs. The Bank sponsored
standard in the Dhaka International Trade Fair- Kamalapur to Rajarbag road-median beautification
Farewell Reception to Sami Al-Hindi, Counselor and Deputy Head of Mission of Royal Embassi of Saudi Arabia

Inauguration of ‘Setubandhoner 100 Din’ (Bridging of 100 Days) Program
program by color showy and herbal plants. A Press was arranged to clarify the Bank’s position
number of quality documentaries were made on the concerning various emerging issues. In recent
Bank’s performance and its CSR activities. These days the Bank has been able to engender a very
were displayed on various Bank programs across much positive image among the media houses of
the country. the country. It also reflects more interviews of our
policy makers & top executives and their attending
Public & Media Relations in TV talk shows.
During the year the Bank devised a slogan ‘Sholo

Publications
Koti Manusher Kache Jai, Amader Desh Amra Sajai’
and observed two multi purpose campaign programs Publications of the Bank increased remarkably in
namely ‘Setu-bandhoner 100 Din’ & ‘Antorik Sebar 2012 in addition to witnessing qualitative change.
3 mas’. A number of public programs including All the publications were updated in standard form.
discussion seminar, clients meeting, NRB get Publications of periodicals were regularized. Five
together, peoples representative & elite assembly, books, booklets and manuals were published in
Shariàh conscious meeting, professionals’ assembly, the year including ‘Islamic Banking in Bangladesh:
entrepreneur development program etc. were An Alternative Paradigm for Sustainable Socio-
organized across all the branches on the occasion. economic Development’ and updated Ìslami
Through these programs, the Bank was able to fulfill Bank: 30 Years of Progress’. Four issues each for
its aim of proving itself as a transparent, accountable Islami Bank house-magazine Porikroma and RDS
and benevolent financial entity in this country. magazine Palli Unnayon Barta were published.
Twelve folders were published in modified version
The Bank also arranged reception program for
and these were also reprinted.
Bangladesh Cricket Board President Mr. AHM
Mostafa Kamal MP for assuming his responsibilities Public Relation Division (PRD) has planned and
as ICC Vice President. With a view to consolide designed publications of Diary and Calendar.
good relations with the media, a good number of Banner, festoon and dangler were printed on branch
bilateral and person-to-person meetings between opening, month long programs and other occasions.
the top management of the Bank with Editors, Greeting cards were distributed on the eve of Eids,
Senior Journalists and Reporters from prominent New Years and other occasions. Desk calendars
print and electronic media were arranged. Meet the and Sehri-ifter schedules were published.

Inauguration of ‘Antorik Sebar 3 Mas’ (3 Months for Cordial Sercvice) Special Program
Event Management
In the events of branch opening and month economic scenario. Amid the alarming period of
long programs, PRD helped in the availability global recession, the Bank has been able to keep
of seminar paper, printing of invitation cards, its head high by the grace of Almighty Allah and
banners, folders, danglers and media coverage. ceaseless efforts of its workforce. In order to raise
Iftar Mahfil was arranged during the Ramadan in the Bank to a new height competing with others
which people of all segments participated. in home and abroad. IBBL is trying to develop
quality publicity & public relations for the Bank.
IBBL has kept its momentum of business success Public Relations is ready to gear up its activities to
despite confronting adverse global and macro achieve all targets set by the Bank in coming days.

Events
IBBL Pavilion at Dhaka International Trade Fair G.M. Quader, MP, Minister for Commerce handing over Crest
for Best Pavilion in Dhaka International Trade Fair
Muhammad Faruq Khan, MP, Minister for Civil Aviation & Engr. Khandaker Mosharraf Hossain, MP, Minister for
Tourism visits IBBL Stall at Asian Tourism Fair Expatriates Welfare & Overseas Employment visits
IBBL Stall at International Immigrants Day Fair
Dilip Barua, Minister for Industry visits IBBL Stall at SME Fair IBBL’s Rally observing the International Immigrants Day

Sports
Champion Team of National School Football Islami Bank A Match of the National School Football Tournament
Tournament 2011
Spectators in a National School Football Islami Bank Agreement with BCB for owning Team in first class
Tournament Match Bangladesh Cricket League
Islami Bank East Zone Cricket Team A Match of Islami Bank East Zone Team

Financial Review
Income Profit Paid on Deposits (PPD)

The Bank earned Total Income of Tk.50,346 The Bank disbursed Tk.25,870 million among the
million during the year 2012 as against Taka Mudaraba Depositors and Mudaraba Perpetual
38,401 million of preceding year registering 31% Bond holders as Profit in 2012, being 70.04% of the
growth over the last year. investment income earned through deployment of
Mudaraba Fund as against minimum 65.00%,
7RWDO,QFRPH which was Tk.18,401 million in 2011 being 68.60 %
,QPLOOLRQ7DND of the same. Investment Income for the year 2012
and 2011 were Tk.43,672 million and Tk.32,020

million respectively.

3URILW3DLGRQ'HSRVLWV33'

$PRXQWLQ0LOOLRQ7DND

Investment Income

The Bank earned total Investment Income of 33'
Tk.43,672 million during the year 2012 as against
Taka 32,020 million of preceding year registering
36% growth over the last year. Investment income
Profit paid to the depositors for the year 2012
for the year 2012 was 87% of the total income
compared to 83% in the year 2011. was paid as per the weightage and rates. In
some deposit products additional amount of
Non-investment Income profit was paid over the rate and rates as per
The Bank earned total Non-Investment Income
weightage. The weightage are presented in the
of Tk.6,674 million during the year 2012 as next page:
against Tk.6,382 million of preceding year. Non-
Investment Income for the year 2012 was 13% of Administrative & Other Expenses
the total income compared 17% in the year 2011.
Total Administrative & other expenses for the year
Expenses 2012 was Tk. 8,867 million as against Tk. 7,268

million in 2011 showing 22% growth over last
Total Expenditure of the Bank was Tk.38,250 year and which was 24% of the total expenditure
(including previsions for investments and other in 2012 compared to 26% in the year 2011.
assets) million during the year 2012 as against
Tk.28,054 million of preceding year registering
36% growth compared to the last year.

Weightage and Final Profit Rates of Deposit
Sl. Final Rate of Final Rate

Particulars of Deposits Weightage
No. 2012 (%) of 2011 (%)
1 2 3 4 5
1 Mudaraba Hajj Savings Account

a) Above 10 years Term 1.35 11.97 10.06
b) Up to 10 years Term 1.30 11.53 9.69
2 Mudaraba Waqf Cash Deposit Account 1.35 11.97 10.06
3 Mudaraba Special Savings (Pension) Account (MSS)
a) 10 years Term 1.30 11.53 9.69
b) 5 years Term 1.10 9.75 8.20
4 Mudaraba Muhor Savings Account (MMS)
a) 10 years Term 1.30 11.53 9.69
b) 5 years Term 1.10 9.75 8.20
5 Mudaraba NRB Savings Bond Account
10 years Term 1.35 11.97 10.06
5 years Term 1.25 11.08 9.32
6 Mudaraba Perpetual Bond (MPB) 1.25 13.58 13.20
7 Mudaraba Savings Bond (MSB)
a) 8 years Term 1.25 11.08 10.00
b) 5 years Term 1.10 10.00 9.10
8 Mudaraba Monthly Profit Deposit Scheme (MMPDS) Account
a) 5 years Term 1.20 11.50 10.00
b) 3 years Term 1.00 11.20 9.00
9 Mudaraba Term Deposits Account
a) 36 Months 1.00 11.20 9.00
b) 24 Months 0.98 11.00 8.50
c) 12 Months 0.96 10.50 8.00
d) 06 Months 0.92 10.50 8.00
e) 03 Months 0.88 10.50 8.00
10 Mudaraba Savings (including RDS) Account 0.75 6.65 5.59
11 Students Mudaraba Savings Account 0.75 6.65 -
12 Mudaraba Farmers Savings Account 0.90 7.98 -
13 Mudaraba Special Notice Deposit Account 0.55 5.00 5.00
14 Mudaraba Foreign Currency Deposit Account 0.75 1.66 1.53
Comparative operating result of IBBL for the year 2012 vis-à-vis 2011
(In million Taka)
Total Income 50,345.77 38,401.29
Less: Profit Paid to Depositors 25,870.43 18,401.22
Total Operating Income 24,475.34 20,000.07
Less: Administrative & Other Expenses 8,867.10 7,268.45
Profit before Tax & Provision 15,608.24 12,731.63
Less: Provision for Investment including Off Balance Sheet items & Other Assets 3,512.07 2,384.31
Total Profit before Taxes 12,096.18 10,347.32

Appropriations Reserve Fund
(In million Taka)
The Reserve fund of the Bank increased to
Particulars 2012 2011 Tk.27,245.87 million as on 31st December, 2012
from Tk.17,792.50 million of the preceding year.
Total Profit/(Loss) before 12,096.18 10,347.31
Taxes
Provision for Tax: 5HVHUYH)XQG

,QPLOOLRQ7DND

Current Tax 6,525.84 5,476.47
Deferred Tax 45.90 29.40

Net Profit/ (Loss) after Tax 5,524.44 4,841.45

Appropriation
Statutory Reserve 2,419.24 2,069.46
General Reserve (22.21) (430.48)
Retained Earnings (Proposed 3,127.41 3,202.47

Dividend)

Total 5,524.44 4,841.45
Contribution to National Exchequer

Mudaraba Perpetual Bond
IBBL regularly pays corporate tax on time. The
In the year 2007 Islami Bank Bangladesh Limited Bank also deposit excise duty, withheld tax and
issued Mudaraba Perpetual Bond (MPB) of Tk. VAT to Govt. exchequer on time deducting from
3,000 million under the Mudaraba Principles of employees salary as well as customers and
Islamic Shari‘ah with the approval of Bangladesh vendors.
Bank (Central Bank) as well as Securities and
Exchange Commission (SEC). The MPB is listed IBBL is the highest Corporate Taxpayer among the
with Dhaka Stock Exchange Limited (DSE) and Local Banks and is the second highest Taxpayer
Chittagong Stock Exchange Limited (CSE) and in the Banking sector of Bangladesh.
trading of the same started on 25th November
2007. Subject to approval of financial statements Contribution to National Exchequer
in the Annual General Meeting the MPB holders
will receive profit at 13.58% per annum for the (In million Taka)
year 2012 which has been determined as follows:

Sl. Total up
Particulars 2012
No. to 2012
Final Rate of 8 Years Mudaraba 11.08% P.A
1 Corporate Tax 3,631.01 26,097.81
Savings Bond
2 Tax Deduction at 2,117.29 10,809.86
Add: 10% of the rate of 2.50% P.A Source on PPD
Proposed Dividend (25%) 3 Tax Deducted at 1,023.87 2,777.41
Total 13.58.% P.A Sources-others
4 Value Added Tax (VAT) 357.84 1,460.07
Dividend 5 Excise Duty 924.25 4,657.89

6 Deduction from salaries 50.23 233.60
The Board of Directors recommended 17% stock of the Employees
and 8% cash Dividend for 2012 on the Paid-up 7 Total 8,106.11 46,036.64
Capital of Tk.12,509.64 million for approval by the
shareholders in the 30th Annual General Meeting.

CSR: Sustainability Report
IBBL Chairman is handing over Winter Cloths to Prime Minister Sheikh Hasina for Prime Minister’s Relief Fund
C orporate Social Responsibility (CSR) is a form

of corporate self-regulation integrated into a
business model. CSR policy functions as a built-
Thereafter, the same has been done through
Islami Bank Foundation (IBF) converting the
Sadaqah Tahbil into a full-fledged foundation
in, self-regulating mechanism whereby a business on May 20, 1991. To comply with the instruction
monitors and ensures its active compliance of the Central Bank, IBBL has started doing the
with the spirit of the law, ethical standards, and said CSR through creation of Corporate Social
international norms. CSR is a process that aims to Responsibility Division (CSRD) at Head Office
embrace responsibility for the company’s actions since 16th July 2009.
and create a positive impact through its activities
on the environment, consumers, employees, Responsibility to the Shareholders
communities, stakeholders and all other members
of the public. • IBBL has been discharging its responsibilities
to safeguard the interest of the shareholders
For entiancing social face of Islamic Banking–
by complying with Shari‘ah, law of the land,
Islami Bank Bangladesh Limited has been
building a strong and efficient management
involved in charitable activities since its
and enhancing shareholders value and
inception through creation of “Sadaqah Tahbil”.
financial performance;
Table: CSR Position of IBBL in Banking Sector of Bangladesh

(In million Taka)
Growth Growth
Particulars 2009 2010 2011
Rate (%) Rate (%)
CSR Expenditure of total Banking Sector 553.80 2329.80 321 2188.33 -6
CSR Expenditure of IBBL 116.27 232.63 100 410.70 76.55
Share of IBBL in CSR Expenditure (%) 21 10 -52 19 137

• Detailed performance including results • The Bank has developed a comprehensive
and important activities of the bank are pay-scale for the employees, the ratio of the
communicated to the shareholders through highest and lowest level in the pay-scale
Annual Report; has been maintained at a lower ratio of 12:1
(DMD:MCG);
• Shareholders are also encouraged to evaluate
Bank’s performance and to give their valuable •
‘Contributory Provident Fund’,
suggestions in the AGMs. ‘Superannuation Fund’ and ‘Gratuity Fund’
have been introduced by the bank for
Responsibility to the Employees employees benefit;
The Bank is always aware of continuous • To meet-up housing need and ensure
development of knowledge, competencies and comfortable life, employees are provided with
attitude of the employees, comfortable and investment at a discounted rate under SHBIS
modern working environment as well as justified and SHDS;
and competitive compensation packages for them.
• The executives of the Bank are provided with
• The recruitment process of the Bank strictly car either from bank management or under
follows “IBBL Recruitment Policy”; “Car Scheme for the Employees of the Bank”;
• Develop professional knowledge, skill and • Human rights are upheld at every aspect of
attitude of the employees, the Bank has the Bank’s operations. The Bank does not
established its own training academy named employ workers under the legal minimum age,
‘Islami Bank Training & Research Academy prohibits the use of all forms of forced labour,
(IBTRA)’; respects employees’ rights to join, form or not
join a labour union, respects the principles of
• The Bank adheres strictly to the ILO labour
collective bargaining, provides health & safety
practices and standards as well as local
at work. The policy is non-discriminatory to
labour laws and regulations;
age, race or sex, prohibits sexual harassment,
• Employees are allowed to operate trade union limits work to standard accepted hours and
activities in the Bank; condemns the use of corporal punishment.
Scholarship Program of the Bank

Col. (Rtd.) Shawkat Ali, Deputy Speaker in a cheque hand over ceremony
Responsibility to the Customers of rural families by channelling foreign

remittance;
• One can open a savings account with Tk. 500,
a current account with Tk. 1,000 and a special • Every branch of the Bank keeps a ‘Complaint
savings scheme (pension scheme) with Box’ to facilitate the customers, lodging
minimum monthly instalment of Tk. 100 only; complaints against services of the bank or
particular employee(s);
• The rural poor are allowed to maintain savings
account by depositing weekly instalment of • Regular meetings are held with the selected
Tk. 10/- only under Bank’s Rural Development customers in different levels of management
Scheme (RDS); to discuss on their business issues and
suggest them for further improvement;
• Our benevolent investment schemes are:
Rural Development Scheme (RDS), Small • The customers of the bank have by now been
Business Investment Scheme (SBIS), Housing extended to online ATM services. The Bank
Investment Scheme (HIS), Real Estate has already started Web Portal, SMS Banking
Investment Program (REIP), Household and Spot Cash services;
Durable Scheme (HDS), Investment Scheme
• IBBL considers the customers as its partners
for the Doctors (ISD), Women Entrepreneur’s
and develops relationship through its
Investment Scheme (WEIS), Micro Industrial
employees as well as by organising various
Investment Scheme (MIIS) and Agriculture
programs in different occasions.
Implements Investment Scheme (AIIS);
• The most important contribution of the bank in Responsibility to the Suppliers

this regard is the creation of huge employment
Suppliers play a fundamental role in the Bank’s
opportunities in its financed projects as well
micro environment. The bank develops its
as at IBBL. At present more than 12,000
relationships with suppliers’ organizations on the
employees are working in IBBL and millions in
basis of value and trust;
its financed projects;
o The Bank has a purchase committee which
• Through its wide-ranged network of 276
is responsible for procurements across the
branches and utilising mobile phone
number of people instead of one or a few
technology, IBBL serves a huge number

Chief Whip Md. Abdus Shahid, MP, distributing blanket to the cold stricken people at Sreemangal
ensuring that the concerned employees and environmental and social effects associated
the bank are trusted and respected; with the products and services they provide;
o All procurements follow a transparent tender o To ensure an equitable share of wealth to a

procedure. Price negotiations are conducted large number of suppliers, the Bank invites
by designated teams and committees. fresh enlistment after every two years.
Suppliers’ information is treated as confidential Existing suppliers are also re-enlisted to
for fair dealing of the process; evaluate their strengths and weaknesses as
well as to categorise suppliers based on their
o In accordance with bank’s ‘Corporate
historical performance;
Procurement Strategy’, it strives to incorporate
environmental and social considerations into o The bank follows a concerted policy of non-
the procurement process; discrimination against small scale suppliers,
whilst 76% of the suppliers’ portfolio can be
o The bank recognises its responsibility to
categorised as micro level entrepreneurs.
encourage suppliers to minimize negative
Sector-wise CSR Expenditure of IBBL from 1983-2012

(In milion Taka)
1983-2009 2010 2011 2012 Total

Sector
Amount Beneficiary Amount Beneficiary Amount Beneficiary Amount Beneficiary Amount Beneficiary
Disaster
217.61 452,291 64.06 158,760 21.79 32,928 87.93 597,866 391.39 1,241,845
Management
Education 285.34 265,197 67.8 98,787 56.17 128,925 83.8 3,014 493.11 495,923
Health 873.62 6,055,481 64.11 721,160 25.78 128,556 39.75 19,230 1,003.26 6,924,427
Sports 60.83 413,622 12.00 2 248.75 636 1.61 144 323.19 414,404
Art & Culture 68.75 187,107 11.22 41,964 7.15 643 8.24 11 95.36 229,725
Environment 0 0 7.36 15,240 0.48 3 12.48 493,822 20.32 509,065
Others 61.31 56,674 11.87 655 50.55 118,115 75.38 34,438 199.11 209,882
Total 1567.46 7,430,372 238.42 10,36,568 410.67 409,806 309.19 11,48,525 2,525.74 100,25,271

Ambulance handover Ceremony
Responsibility to the Community Sector-wise CSR Expenditure for the

The Bank is very much conscious about its year 2012
responsibility towards the communities within

which it operates. The Bank takes several
initiatives in individual and organizational level
for development of the community. IBBL takes
several programs to improve the lives of the people
especially to the less fortunate segments of the
community. An amount of Tk. 2525.74 million was

spent for 100,25,271 beneficiaries by IBBL during
1983-2012 for this purpose. IBBL contributed Tk. 'LVDVWHU0DQDJHPHQW $UW &XOWXUH
309.19 million for 11,48,525 beneficiaries this year. (GXFDWLRQ (QYLURQPHQW
Bank’s strategy towards discharging community +HDOWK 2WKHUV
responsibility focuses on: (1) Education, (2) 6SRUWV
Health, (3) Disaster Management (4) Sports, arts
& culture, & (5) Women empowerment.
Education Program
Sector-wise CSR Expenditure of IBBL Human being can not develop properly without
from 1983-2012 education. IBBL is engaged in the promotion
of education sector of the country from the
very beginning. IBBL spent an amount of Tk.

493.11 million amongst 495,923 beneficiaries
during 1983-2012 for this purpose. Last year

this contribution was Tk. 83.80 million for 3,014
beneficiaries including regular scholarships to 800

students.
The Bank has been providing scholarship to

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+HDOWK
the poor students securing GPA 5 in SSC &
6SRUWV
$UW &XOWXUH (QYLURQPHQW
HSC examinations since 2010 under its direct
2WKHUV scholarship program. During the last two years,

the Bank provided scholarship to 800 (HSC 400 • Every year the Bank awards to the meritorious
[male 200 & female 200] + 400 under graduate wards of the employees for outstanding
students [male 200 & female 200]) students results. An amount of Tk. 14.48 million has
under this program @ Tk. 1,000/- & Tk. 1,500/- so far been spent for 1350 beneficiaries since
per month for the period of 02 years & 03 to 05 1993;
years for HSC & Graduation level respectively.
Recently, the management of the Bank has • IBBL awards scholarship to MBA students
decided to increase the scholarship from 200 to (Banking & Finance) for their outstanding
400 [male 200 & female 200] students both HSC results. An amount of Tk. 1.12 million has
& Graduation level from the year of 2012. been given to 103 students since 1991;
In addition to the aforesaid students, IBBL has • Different research organizations and
been providing scholarship to 400 meritorious educational institutes were provided with
but poor students under its Special Scholarship financial assistance for research and
Program since 2011. educational purposes;
• It may be mentioned here that, IBBL has • IBBL has so far established one Medical
taken a 10 years plan for scholarship, where College, one Health Technology Institute,
10,800 students will be benefited from the one Nursing Training Institute, six Technical
scholarship. For this purpose Tk. 356.22 Institutes, one English medium school,
million will be spent; one Bangla medium school and one girl’s
• The bank also provides scholarship for PhD madrasha under its Foundation management
students since 2007. An amount of Tk. 6.20 to contribute development in the education
million was spent for this purpose so far; sector of the country.
• Lump-sum financial assistance has also been

given by the Bank for education purpose on
case to case basis;
Scholarship Program of the Bank

Detail Particulars of Scholarship
(In millionTaka)
Sl. No. of Already Organizing Total
Name of the Program Budget Remarks
No. students given Expenses expense
1 HSC Level -2010 200 6.48 4.78 1.51 6.29 Period July 2010 -
June 2012
2 Graduation Level -2010 200 14.40 8.88 8.88 Period July 2010 -
June 2014
3 HSC Level -2011 200 5.90 3.56 0.97 4.53 Period July 2011 -
June 2013
4 Graduation Level -2011 200 15.32 5.35 0.96 6.31 Period July 2011 -
June 2015
5 Special Scholarship 2011 400 5.17 4.26 0.52 4.78 For year 2011
6 Special Scholarship 2012 400 7.78 6.77 0.80 7.57 For year 2012
Total 1600 55.05 33.60 4.76 38.36
7 HSC Level -2012 (under 400 11.90 Period July 2012 -
process) June 2014
8 Graduation Level -2012 400 31.10 Period July 2012 -
(under process) June 2016
Total 2000 98.05
Year-wise Expenditure to Education 1. IBBL established six fully owned hospitals

and seven community hospitals with a total
7KLV\HDU &XPXODWLYH of 1021 beds creating employment of 561
,QPLOOLRQWDND doctors and 411 other employees;

2. A good number of charitable dispensaries

are operated by local initiatives mainly in the
rural areas with the help of IBBL. Every year
about two lac patients are provided treatment
facilities from these dispensaries.
Expenditure in Health Sector
8SWR 7KLV\HDU &XPXODWLYH
,QPLOOLRQWDND
Health-care Program

People faces a perilous situation due to hazardous
medicare system of the country. IBBL takes
several initiatives in individual and organizational
level for developing health sector of Bangladesh.
IBBL spent Tk. 1003.26 million for health sector
during 1983-2012 among 69,24,427 beneficiaries.
8SWR
During the year 2012 Tk. 39.75 million was
provided to 19,230 beneficiaries for this purpose.
Disaster Management
Apart from these, IBBL has taken some sustainable
Bangladesh is a developing country fighting with
initiatives for developing medicare system of the
poverty and natural disasters. Being a corporate
country which are as follows: citizen of the country, IBBL always stands beside

Cheque handover ceremony at the office of DU Vice Chancellor Prof. Dr. A.A.M.S Arefin Siddique
the distressed humanity. An amount of Tk. 391.39 Besides, Tk. 1.92 million was paid to the families
million was spent by IBBL from 1983-2012 for this of 4 martyred army officials, killed in BDR mutiny,
purpose. This year IBBL contributed Tk. 87.93 as their annual family expenditure;
million to 597,866 beneficiaries in this sector.
The Bank also spent Tk. 7.74 million for distribution
To encourage the people involving in humanitarian of relief among flood affected people of the country.
activities, IBBL devised a deposit product namely
“Cash Waqf Deposit Scheme”; Sports, Arts & Culture
IBBL always comes forward to assist the victims of
7KLV\HDU &XPXODWLYH
natural or social disasters. During this year IBBL
distributed winter cloths to the poor for an amount ,QPLOOLRQWDND
of Tk. 71.02 million;

The Bank provides financial assistance to needy
and heavily indebted individuals to meet up their
various emergency family needs;
Disaster Management
7KLV\HDU &XPXODWLYH
,QPLOOLRQWDND 8SWR

Sports, Arts and Cultural Program

Sports, arts and cultural programs make a nation
physically and mentally sound and healthy.
Engaging with this type of works young people
could be able to avoid many socially undesirable
activities, like: taking drugs, involving forbidden
underworld parties, hijacking money from innocent
8SWR
people etc. This is why IBBL sponsors various

IBBL Vice Chairman is handing over Cheque to Women Entrepreneur Association of Bangladesh for establishing ‘WEAB Training Centre Cum Outlet
sports and cultural events every year. During 2. IBBL distributes ‘Kurbani Meat’ received from
2012 the bank contributed Tk. 9.85 million for Kingdom of Saudi Arabia (KSA) and Islamic
this purpose. To uphold and promote the culture Development Bank (IDB) as a gift to the
of the nation, IBBL has established ‘Bangladesh destitute people of Bangladesh every year.
Sangskritic Kendra’. This year an amount of Tk. 3.53 million was
spent for distributing the meat.
Others Activities In 2012, IBBL spent an amount of Tk. 75.38 million
Apart from the aforesaid CSR activities, IBBL for other CSR activities.
takes many other initiatives as CSR activities such
as: Women Empowerment Program
1. Every year IBBL distributes food items to Alim IBBL is very much conscious about the prevailing
and poor families as a Tohfa-e-Ramadan. conditions of the women in our society. Keeping
This year an amount of Tk. 53.39 million was this in view, it takes various programs for
spent for this purpose. empowering the women like awareness building,
training, financing etc. The programs include:
Others CSR Activities
* Encourage husbands in making easy payment
7KLV\HDU &XPXODWLYH of the Mohor, the Bank introduced a deposit
scheme namely “Mudaraba Mohor Deposit
,QPLOOLRQWDND
Scheme”;
* Rural poor women are organised under Rural

Development Scheme and encouraged to

make savings at least Tk. 10/- per week with

the Bank;
* The Bank has deviced an investment scheme

exclusively for the women namely “Investment
Scheme for the Women Entrepreneurs”;
8SWR

* Number of female members under bank’s 2. Reduction of industrial carbon emission;
Rural Development Scheme (RDS) is 517,398
3. The Bank is directly in involvement in
which is 85% of total RDS members;
plantation activities at rural and urban areas
* The Bank has established a rehabilitation along with distribution of the saplings in
centre for the distressed women namely country areas to protect environment
“Islami Bank Distressed Women Rehabilitation
4. Scrutiny of negative impacts of the
Centre”. Distressed and destitute women
corporations on environment and taking
are given shelter, education, training and
necessary mitigating measures there against.
employment opportunities there.
For this purpose IBBL contributed an amount of
Responsibility to the Environment Tk. 20.32 million for 5,09,065 beneficiaries from
1983 to 2012.
The main theme of environmental responsibility is
to create ‘No Harm’ to the environment in view of
Expenditure for Environment
keeping it healthy for future generation. Now adays
climatic change is addressed seriously all over
the world. It is identified that Bangladesh, being a (QYLURQPHQW
southern delta, is under serious threat of natural
disaster. In view of the above, the corporations 7KLV\HDU &XPXODWLYH
are recommended to pay due attention to the ,QPLOOLRQWDND
followings:
1. Reducing the use of non-renewable energy

& materials (electricity, gas, fuel, paper,

stationeries etc.) and to increase use of

renewable or recyclable energy & materials
(solar power, bio-gas, electronic media of
communication etc.);
Sector wise Market Share of IBBL in CRS Activities

(In million Taka)
2010 2011
Sector
Banking Sector IBBL % of IBBL Banking Sector IBBL % of IBBL
Disaster Management 460.41 64.06 14 188.03 21.79 12

Education 400.79 67.8 17 612.48 56.17 9
Health 689.07 64.11 9 520.42 25.78 5
Sports 265.23 12.00 5 359.07 248.75 69

Art & Culture 328.91 11.22 3 171.52 7.15 4
Environment 59.78 7.36 12 138.07 0.48 1

Others 125.58 11.87 9 198.73 50.55 25
Total 2,329.80 238.42 10 2,188.33 410.67 19

Islami Bank Foundation
B y the grace of Almighty Allah, Islami Bank Foundation, since its inception, has been working for the service
of the distressed humanity and playing a significant role in social service and development.
The activities of the Foundation has increased manifold with the passage of time. Since inception the
Foundation, to achieve its cherished objectives, has been implementing its regular programs and undertaken
some unique projects. A brief description of the programs and projects implemented by the Foundation in 2012
is given below:
Item-wise Expenditure of Islami Bank Foundation in 2012
Sl. Items
No.
1 Income Generation
Sewing Machine, Self-employment Project & Self employment Program.
2 Education
Model Forkania Maktabs, Scholarship for poor & meritorious students, Financial support for educational
institutions, Lump-sum grant for poor and meritorious students, Mobile library, Slum development etc.
3 Health & Medicare
Supporting charitable dispensaries, Lump-sum help for treatment, Arsenic Mitigation Programme,
Sanitary latrine construction, Circumcision camp, Mobile eye camp & Midwifery training Program.
4 Humanitarian Help
Lump-sum grant for distressed, Assistance to orphanages, Assistance for marriage of poor girls,
Assistance for construction of dwelling houses, Islami Bank Women Rehabilitation Centre etc.
5 Relief & Rehabilitation
Distribution of relief materials among the people affected by Tornado, flood, Sidor Tidal surge & distribution
of sacrificial meat and Operating cost of Fael Khair Program etc.
6 Literature, Cultural & Publication Programmes
Distribution of Islamic books and periodicals, Helping Youth clubs and Voluntary organizations, Assistance
for child & youth development & Bangladesh cultural centre and Construction of Mosque etc.
7 Special Projects
Islami Bank Hospitals, Islami Bank Community Hospitals, Islami Bank Medical College, Rajshahi,
Islami Bank Medical College Nursing Institute, Rajshahi, Islami Bank Institute of Technology, Rajshahi,
Monoram-Islami Bank Crafts & Fashion, Islami Bank Model School and College ( Bangla Medium), Islami
Bank International School & College, Dhaka, Islami Bank Institute of Technologies, Islami Bank Mohila
Madrasha, and IBF Projects cox’s bazar etc.
8 Capital Expenditure
IBH Complex, Kakrail, IBF Office Purchase, Furniture & Fixture of IBF office, Investment for HDS &
SHBIS etc.
9 Operating Expenses
Administrative expenses, Salary & allowances Postage, conveyance etc.

ICU at Islami Bank Hospital
A brief description regarding the special projects Health Education

are given below:
Islami Bank Medical College
Hospitals The activities of Islami Bank Medical College,

Rajshahi are runing satisfactorily. The classes
Six Islami Bank Hospitals (two located in Dhaka,
of the students of 10 different batches are being
two in Rajshahi, one in Khulna and one in Barisal),
conducted full in swing. The construction work
extend services in the field of Medicine, Surgery,
of the south block of the hospital building at
Gynae, Pediatric, E.N.T, Urology, Neurosurgery,
Naodapara, the own site of the College, is already
Skin, Eye, Orthopedic, Cardiology etc. at a cost
completed and construction of the academy
within the reach of common people. In the year
building is going on. There were 374 students in
2012, a total number of 65,372 patients received
the college in 2012 and 68 students were awarded
free treatment facilities from Islami Bank Hospitals.
MBBS degree.
Community Hospitals
Islami Bank Medical College Hospital
The activities of seven Islami Bank Community Nursing Institute
Hospitals at Satkhira, Manikgonj, Rangpur,
There is a great dearth of qualified nurses in our
Jhenaidah, Dinajpur, Faridpur and Naogaon are
country and, therefore, quality treatment services
going on in full swing. Four more community
are being hampered to a great extent. Keeping in
hospitals are going to be commissioned soon in
view the above situation, Islami Bank Foundation
Madaripur, Noakhali, Mymensingh and Feni. In
(IBF) established a Nursing Training Institute in
the year 2012, a total number of 8,655 patients
Rajshahi to create employment opportunity for the
received free treatment facilities from Islami Bank
youths and meet the increasing needs of qualified
Community Hospitals.
nurses. A total of 197 students were studying in the
institute in 2012.

Islami Bank Institute of Health Health Care Services
Technology
Circumcision Program
Proper diagnosis of diseases is vital in rendering
IBF executes a good number of Circumcision
proper treatment facilities to patients. In our country
Program in rural areas in Bangladesh through
there is a good number of hospitals/ clinics and
hospitals established by it. Qualified and expert
diagnostic centers. But most of them do not have
doctors give treatment facilities to the poor
necessary technical manpower to do pathological
children. The children are also given relevent
and radiological tests. Therefore, the patients have
medicine, ‘Lungi’ and ‘Guernsey’ are offered in the
to suffer frequently because of wrong diagnosis of
institute at free of cost.
diseases. IBF has, therefore, established a Health
Technology Institute in Rajshahi in the name
of “Islami Bank Institute of Health Technology”. Mobile Eye Camp
Courses on Pharmacy, Dentistry, Radiology & In the year 2012, a total number of 590 patients
Imaging, Pathology are offered the institute. A total received eye treatment through Mobile Eye Camp
number of 369 students were in studying in 2012. arranged in IBBL hospitals.
Midwifery Training Program Charitable Dispensaries

Usually the traditional birth attendants conduct the IBF has been conducting a good number of
normal delivery in rural ares. They do not have Charitable Dispensaries in rural areas in different
any formal training in this regard and, therefore, parts of the country. Some of the charitable
a good number of mothers and babies die at the dispensaries are rendering allopathic treatment
time of delivery stage. Many of them, though do while the others are providing homoeopathic
not die, suffer even whole life for wrong handling treatment. Usually a qualified doctor gives
of the traditional birth attendants. Considering prescription to the patients once or twice in a
the above situation Islami Bank Foundation has week without any fee. The patients are also given
necessary medicine at free of cost. In the year
introduced Midwifery Training Program with the
2012, so far 101,869 patients received treatment
help of Islami Bank Hospitals and Islami Bank
facilities through the charitable dispensaries.
Community Hospitals.
Dental Treatment in Islami Bank Hospital

Technical Education Islami Bank Model School and College
Islami Bank Institute of Technology Islami Bank Model School and College is one of
the important projects of IBF. To impart modern
Six units of Islami Bank Institute of Technology, education with moral values, the school was
two in Dhaka, one in Bogra, one in Sylhet, one started at Mirpur, Dhaka where a qualified Head
in Chittagong and another in Khulna, have been Master was appointed. In the year 2012, a total
working satisfactorily to provide skill development number of 633 students were studying in the
training to the unemployed youths to make them institution.
self -reliant and to transform the country into a
technologically sound nation. In the meantime,
IBIT Dhaka (2 Units), Chittagong, Sylhet and Bogra
Islami Bank Mohila Madrasha
have got the affiliation of Bangladesh Technical Islami Bank Mohila Madrasha is one of the
Education Board. In the year 2012, a total number important projects of IBF. To render modern
of 2,066 students were studying in the IBITs. education with moral values the Madrasha was
established in Mirpur, Dhaka where a qualified
General Education Head Mistress was appointed. In the year 2012
a total number of 143 students were studying in
Islami Bank International School and the school.
College
As Dhaka, the capital of Bangladesh, is turning to Scholarship Program
be a mega city, a good number of English Medium Scholarship program is one of the important
Schools are creeping up which follows curriculum
activities of IBF. Under this program, scholarships
without conforming fully to the need of the country.
are given to the students of Colleges, Madrasha
As an attempt to combine modern education
and Universities at home and abroad. Moreover,
with moral values for a total development of the
scholarship is offered to the researchers to obtain
children, IBF has established English medium
international school and college at 147 Green MPhil and PhD degrees. In the year 2012, a total
Road, Dhaka. In the year 2012, a total number of of eight PhD holders received scholarship from
266 students were studying in the school. the Foundation.
Class Room of Islami Bank Institute of Technology

Monorom, Islami Bank Crafts and Fashions House
Model Forquania Maktab rehabilitation of the hapless, helpless, distressed,

shelterless widows and divorced women under
Model Forkania Maktab project is one of the the name and style of “Islami Bank Women
important projects of IBF. Maktabs run by IBF Rehabilitation Centre” at Mirpur, Dhaka.
provides rural children with the facilities of
learning The Holy Quran as well as English and
Bangla alphabets and elementary knowledge
Monoram - Islami Bank Crafts and
of Mathematics helping them a lot to read in the Fashions
School and Madrasha. In the year 2012, so far Two units of Monoram-Islami Bank Crafts and
22,255 students were studying in the Forkania Fashions are in operation at Basundhara City
Maktabs. and the Grand plaza of Moghbazar in the heart of
Dhaka city and have been playing a significant role
Bangladesh Sangskritic Kendra in uplifting the condition of the poor and distressed
women through channeling sales opportunity of
To save our youth force from derailment, it is
their products.
essential to uphold and promote the culture which
is of our own. Keeping in view the above, IBF has A total of 3,746 employees are serving in the IBF
established Bangladesh Sangskritic Kendra in Head Office and in different projects offices.
Dhaka and Rajshahi and establishing of another
Thus, the Foundation, through its multifarious
32 centers are under process.
welfare programs, is ceaselessly working to
serve the distressed humanity and change the
Islami Bank Women Rehabilitation socio-economic status of the un-privileged and
Centre neglected section of the society.
As part of service to the distressed humanity IBF
has established a centre for shelter, training and

Appreciation
T he Board of Directors expresses sincere

gratitude to the Almighty Allah for enabling
the bank to achieve steady progress in all
To conclude, notwithstanding the fact that Islamic
banks have been able to shield themselves
from the spillover impact of the global economic
aspects of operation during the year 2012. The recession, no one can predict the extent to which
Board extends thanks to the Ministry of Finance, the Islamic finance principles will serve to protect
Bangladesh Bank, Bangladesh Securities and them from the looming financial crisis. Whilst
Exchange Commission, Dhaka Stock Exchange some have pointed out that it is already knotted
Limited, Chittagong Stock Exchange Limited, with the mainstream finance whereby its future is
National Board of Revenue, Registrar of Joint as risky as any other part of the global financial
Stock Companies, Statutory Auditors and the industry, experts in Islamic finance believe that
Government Agencies for providing necessary their way of carrying out financing operations
assistance, guidance, support and co-operation at has shielded them from the global credit crunch
various stages of operations of the Bank. With deep and hence, the model stands on its own merit.
sense of gratitude, the Board also keeps on record London, Singapore, Paris and Hongkong, the
the excellent co-operation, exchange of views and financial hubs of the world, are competing with
constant support of Islamic Development Bank each other be benefitted out of Islamic finance.
(IDB), other national and overseas Islamic Banks Reputed banks like, Standard Chartered , HSBC
and Financial Institutions. and Citi Bank have already set up Islamic banking
subsidiaries that are flourishing.
The Board appreciates the support and co-
operation received from overseas correspondents May Allah, the most Merciful bestow on us
of the bank all over the world. The Board courage, dedication, patience and fortitude to
particularly records its appreciation for the serve the cause of Islam and of Bangladesh and
Shari‘ah Supervisory Committee whose guidance run the bank as per the vision and mission put
has enabled the Bank to conduct its business forth and tenets of Islamic Shari‘ah. Ameen.
complying Islamic principles. The Board of
Directors also extends the best compliments to all
of its valued shareholders, depositors, investment
On behalf of the Board of Directors
clients, print and electronic media and other
stakeholders and well-wishers and expresses
thanks and gratitude to them for their valuable
support and confidence reposed on the Bank.
Dated, Dhaka Prof. A.N.M.A. Zaher
The Board would like to express its great May 22, 2013 Chairman
appreciation and thanks to all the officials and staff
of the Bank for their untiring efforts, leadership and
dedication for bringing about a better performance
of the Bank during the year under report.

Audit Committee Report
In compliance with the BRPD Circular No. 12,

dated 23 December 2002, the formal Audit
Committee of IBBL started functioning duly
functions: ensured effective co-ordination of
external audit function, ensured independence of
external auditors, reviewed the external auditors
appointed by the Bank’s Board of Directors with a findings in order to be satisfied that appropriate
view to ensuring the achievement of objectives of action has been taken.
the Bank, efficiency of operations, and compliance
with the applicable laws, regulations and internal Meeting of the Audit Committee
policies to make the Bank a unique, strong and
dependable organization for all stakeholders During the year 2012, the Audit Committee of the
specifically shareholders, depositors and the bank held 22 meetings. Proceedings of the Audit
society as a whole. In this context, the present Audit Committee meetings were reported timely and
Committee comprising of 4(four) members has regularly to the Board of Directors.
been appointed by the Bank’s Board of Directors
During the period, the Committee performed,
for 03(three) years. Pursuant to the instructions of
amongst others, the following key functions:
Bangladesh Securities and Exchange Commission
and the Bangladesh Bank, an Independent Director 1. Carefully evaluated the level of compliance
and two Directors on behalf of the Depositors have of the Corporate Governance Guidelines of
been included in the Committee. the Bangladesh Securities and Exchange
Commission, dated 07.08.2012.
Composition of the Audit 2. Evaluated the compliance culture across the

Committee Bank.
As per regulatory guidelines, the Company 3. Reviewed the existing risk management
Secretary of the bank is the Secretary of the Audit procedures for ensuring an effective internal
Committee. check and control system of the Bank.
The composition of the present Audit Committee of the Bank

Status in the Board of Status in the Audit
Sl. No. Name
Directors Committee
1. Professor NRM Borhan Uddin, Ph.D. Independent Director Chairman
2. Janab Mohamad Adnan Midani Foreign Director Member
(Representative, Islamic Development Bank, KSA.)
3. Janab Md. Abdus Salam, FCA, FCS Depositor Director Member
4. Janab Humayun Bokhteyar, ACPA, FCA Depositor Director Member
4. Pursued the Audit Calendar for the period

Statement of the Audit Committee
under review and advised to follow the audit
The Audit Committee during its review stated that program meticulously.
the internal controls of the bank are well conceived,
5. Reviewed the risk grading of the branches
properly administered and satisfactorily monitored.
prepared on the basis of audit and inspection
The committee also stated that during its reports.
involvement in the review of the external audit

6. Discussed the internal and external audit Statements to the Board and ensured that
reports and advised the management to authentic and reliable Financial Information have
rectify all lapses revealed in the reports. been incorporated in preparing those Financial
Statements and in other interim reports.
Additionally from time to time the concerned
Head of Wings/Divisions/Branches and other
Offices of the Bank were invited to attend Review of Financial Statements
the meeting of the Audit Committee in order The Audit Committee reviewed and examined the
to augment the process of regularization of Financial Statements 2012 of the bank to confirm
lapses and irregularities. whether all the disclosures and information have
7. Discussed the Bangladesh Bank inspection been incorporated in the Financial Statements
reports on the Branches and Head office and and whether the Bank followed International
advised the management to rectify all lapses. Accounting Standards(IAS) and International
Financial Reporting Standards (IFRS) adopted
8. Advised the management to complete all the as Bangladesh Accounting Standards(BAS)
documentation formalities carefully and retain and Bangladesh Financial Reporting Standards
each and every document accurately. (BFRS) by the Institute of Chartered Accountants
of Bangladesh, Bank Company Act 1991,
9. Reviewed the reports on overdue, classified,
Bangladesh Bank Guidelines, the Companies Act
rescheduled, written off investment and
1994, the Bangladesh Securities and Exchange
other non-performing assets and directed to
Commission Rules and other laws and rules
exert all-out efforts to reduce non-performing
applicable in Bangladesh and also Standards
assets.
issued by the Accounting and Auditing Organization
10. Suggested to take up the matters with for Islamic Financial Institutions (AAOIFI), Bahrain,
concerned lawyers for early disposal of the etc. The Committee recommended the Financial
suits for recovery of the Bank’s dues. Statements for consideration of the Board.
11. Advised the management to ensure full

compliance of regulatory issues meticulously. Meeting with the Statutory Auditors
12. Advised the management to ensure full The Committee met with the Statutory Auditors
Shari‘ah compliance in all areas of business. for finalization of financial statements. It
properly addresses the issues mentioned in the
13. Suggested some measures for capacity Management Letter for taking appropriate action
building of the internal auditors and to further by the management.
strengthen the internal audit function.
Acknowledgement
Statutory Auditors Appointment
The Committee expressed its profound thanks
The Audit Committee duly recommends to the and gratitude to the Members of the Board,
Board for appointing Statutory Auditors in the Management, Auditors and all the Regulatory
Annual General Meeting. Authorities, in particular, Bangladesh Bank
and the Bangladesh Securities and Exchange
Selection of Accounting Policy Commission for their excellent support while
performing its coveted duties and responsibilities.
The Audit Committee reviewed the accounting
policies adopted by the bank and ensured that the
policies were properly applied in preparation of the
Financial Statements of the Bank.
Interim Financial Reports Professor NRM Borhan Uddin, PhD

Chairman
The Audit Committee reviewed and recommended
the quarterly and the half yearly Financial Audit Committee

Report of the Shariàh Supervisory Committee
D uring the year 2012, the Shariàh Supervisory

Committee met and reviewed different
operational activities, including those referred to it by
and Management authority and due to creating
Shariàh awareness at branch level and sincere
efforts of the manpower of the Bank.
the Board of Directors as well as the Management of 2. The investments and transactions performed
the Bank and gave opinions and decisions related to by Islami Bank Bangladesh Limited during the
Shariàh. The Honourable members of the Shariàh year, have been made in accordance with the
Supervisory Committee attended 09 seminars principles of Islamic Shariàh.
organized by the Management of the Bank on the
3. Profit distributed to deposit accounts has been
eve of inauguration of new branches and 17 Shariàh
made in accordance with Islamic Shariàh.
awareness programs arranged by the Head Office
and different Zones. Apart from this, the Shariàh 4. The income detected as doubtful as per
Secretariat conducted Shariàh inspection at 266 principles and rules of Islamic Shariàh has not
branches (including 30 SME/Krishi Branches) during been included in the distributable income of the
the period excluding new 10 branches of the Bank bank.
established in 2012 and submitted detailed report 5. The calculation of Zakat on the Zakatable asset
thereon. of the bank has been made in compliance with
The duty of the Shariàh Supervisory Committee is to the rules and the principles of Islamic Shariàh.
give independent opinions and necessary guidelines It is pertinent to state that Islami Bank does
upon observing and reviewing the activities of the not deduct the Zakat from depositors and
bank and the responsibility of the bank is to ensure shareholders accounts. It is the responsibility of
that the Bank conducts its business in accordance the Depositors and Shareholders to pay Zakat
with the rules and principles of Islamic Shariàh. on their deposits and shares respectively.
The Shariàh Supervisory Committee, after reviewing 6. More precautionary measures are required to
the Shariàh inspection reports, Audited Reports i.e. be adopted in appointing Buying Agents in the
Balance Sheet, Profit & Loss Accounts and other branches and to ascertain the duties of the
Financial Statements of the Bank for the year 2012, agents and the branches properly.
gives the following opinions: 7. The Rural Development Scheme (RDS) is a
1. Shariàh compliance has significantly been praiseworthy effort of Islami Bank for poverty
improved during the year 2012 compared to eradication of the country. It is essential to
last few years due to different steps taken take more effective precautionary measures for
by the bank such as motivational programs, Shariàh compliance in this respect.
administrative measures, intensive supervision May Allah (SWT) bestow us with the best of Tawfique
and cooperation rendered by the Board of in gaining His satisfaction through implementing
Directors, Shariàh Supervisory Committee Shariàh in every sphere of our life. Ameen.
Sheikh Moulana Mohammad Qutubuddin Professor Dr. Abu Bakr Rafique

Chairman Member Secretary

Auditors’ Report
&
Audited Financial Statements
of
and its Subsidiaries

Auditors’ Report
to the Shareholders of Islami Bank Bangladesh Limited

We have audited the accompanying consolidated financial statements of Islami Bank Bangladesh Limited and
its subsidiaries, (“the Group”) as well as the separate financial statements of Islami Bank Bangladesh Limited
(“the Bank”) which comprise the consolidated and the separate Balance Sheets as at 31 December 2012 and
the consolidated and the separate Profit & Loss Accounts, Statements of Changes in Equity and Cash Flow
Statements for the year then ended, and a summary of significant accounting policies and other explanatory
information.
Management’s Responsibility for the Consolidated and the Separate Financial Statements
Management is responsible for the preparation and fair presentation of these consolidated financial statements
of the Group and the separate financial statements of the Bank in accordance with Bangladesh Financial
Reporting Standards (BFRSs), the Bank Company Act 1991, the policies, guidelines, rules and regulations
issued by Bangladesh Bank, the Companies Act 1994, the Securities and Exchange Rules, 1987, principles
of Islamic Shari‘ah and other applicable laws and regulations and for such internal control as management
determines is necessary to enable the preparation of financial statements that are free from material
misstatement, whether due to fraud or error; selecting and applying appropriate accounting policies; and
making accounting estimates that are reasonable in the circumstances.
Auditors’ Responsibility
Our responsibility is to express an opinion on these consolidated financial statements of the Group and the
separate financial statements of the Bank based on our audit. We conducted our audit in accordance with
Bangladesh Standards on Auditing (BSA). Those standards require that we comply with ethical requirements
and plan and perform the audit to obtain reasonable assurance about whether the consolidated financial
statements of the Group and the separate financial statements of the Bank are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in
the consolidated financial statements of the Group and the separate financial statements of the Bank. The
procedures selected depend on the auditors’ judgment, including the assessment of the risks of material
misstatement of the consolidated financial statements of the Group and the separate financial statements
of the Bank, whether due to fraud or error. In making those risk assessments, we consider internal controls
relevant to the entity’s preparation and fair presentation of the consolidated financial statements of the Group
and the separate financial statements of the Bank in order to design audit procedures that are appropriate
in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s
internal control. An audit also includes evaluating the appropriateness of accounting policies used and the
reasonableness of accounting estimates made by management, as well as evaluating the overall
presentation of the consolidated financial statements of the Group and the separate financial statements of
the Bank.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our
audit opinion.
Opinion
In our opinion, the financial statements referred to above which have been prepared in the format prescribed
by Bangladesh Bank vide Circular No. 15 dated 09 November 2009 give a true and fair view of the financial
positions of the Group and the Bank as at 31 December 2012 and their financial performances and cash
flows for the year then ended in accordance with Bangladesh Financial Reporting Standards and comply with

the Bank Company Act 1991, the policies, guidelines, rules and regulations issued by Bangladesh Bank,
the Companies Act 1994, the Securities and Exchange Rules 1987, principles of Islamic Shari‘ah and other
applicable laws and regulations.
We also report that,

i) we have obtained all the information and explanations which to the best of our knowledge and belief
were necessary for the purposes of our audit and made due verification thereof;
ii) in our opinion, proper books of account as required by law have been kept by the Group and the
Bank so far as it appeared from our examination of those books and proper returns adequate for the
purposes of our audit have been received from branches not visited by us;
iii) the consolidated balance sheet and the profit and loss account of the Group and the separate
balance sheet and the profit and loss account of the Bank together with the annexed notes 1 to 44
dealt with by the report are in agreement with the books of account and returns;
iv) the expenditure incurred was for the purpose of the Group’s and the Bank’s business;
v) the financial positions of the Group and the Bank as at 31 December 2012 and their profits for
the year ended 31 December 2012 have been properly reflected in the consolidated financial
statements of the Group and the separate financial statements of the Bank and the consolidated
financial statements of the Group and the separate financial statements of the Bank have been
prepared in accordance with the generally accepted accounting principles;
vi) the consolidated financial statements of the Group and the separate financial statements of the
Bank have been drawn up in conformity with the Bank Company Act 1991 and in accordance with
the accounting rules and regulations issued by the Bangladesh Bank and the financial statements
conform to the prescribed standards set in the accounting regulations issued by Bangladesh Bank
after consultation with the professional accounting bodies of Bangladesh;
vii) adequate provisions have been made for investments and other assets which are, in our opinion,
doubtful of recovery;
viii) the records and statements submitted by the branches have been properly maintained and
consolidated in the financial statements;
ix) the information and explanations required by us have been received and found satisfactory;
x) we have covered over 80% of the risk weighted assets of the Bank through our audit and we have
spent more than 7,600 person-hours for the audit of books and accounts of the Bank;
xi) it appeared from our test checks that the internal control system was satisfactory and adequate to
prevent probable frauds and forgeries;
xii) Cash Reserve Requirement (CRR) and Statutory Liquidity Reserve (SLR) with Bangladesh Bank
have been maintained as per rule;
xiii) As far as it was revealed from our test checks, the existing rules, regulations and procedures for
sanctioning and disbursement of investment have been followed properly; and
xiv) the capital adequacy ratio (CAR), as required by law, has been maintained adequately during the
year.
Dhaka, A. Qasem & Co. ACNABIN


Islami Bank Bangladesh Limited and its Subsidiaries
Consolidated Balance Sheet
As at 31 December 2012
31.12.2012 31.12.2011
Property and Assets Notes
Taka Taka
Cash in hand 7(a) 41,774,012,643 40,631,914,271

Cash in hand (including foreign currency) 6,308,274,680 4,655,996,987
Balance with Bangladesh Bank & its agent bank(s) (including foreign 35,465,737,963 35,975,917,284
currency)
Balance with other banks & financial institutions 8(a) 24,524,933,077 16,853,296,480
In Bangladesh 17,432,561,802 13,140,359,824
Outside Bangladesh 7,092,371,275 3,712,936,656
Placement with banks & other financial institutions - -
Investments in shares & securities 9(a) 25,560,064,458 15,853,181,923
Government 23,504,977,770 13,927,177,770
Others 2,055,086,688 1,926,004,153
Investments 372,920,722,887 305,790,180,873
General investments etc. 10(a) 340,479,756,413 287,861,385,224
Bills purchased & discounted 11(a) 32,440,966,474 17,928,795,649
Fixed assets including premises 12(a) 14,816,765,447 7,110,249,574
Other assets 13(a) 3,052,992,955 3,136,781,099
Non - banking assets - -
Total property and assets 482,649,491,467 389,375,604,220
Liabilities and Capital

Liabilities
Placement from banks & other financial institutions - -
Deposits & other accounts 14(a) 417,845,688,579 341,855,262,815
Mudaraba savings deposits 151,012,262,458 132,051,082,776
Mudaraba term deposits 97,278,542,378 65,167,293,216
Other mudaraba deposits 117,807,137,348 103,114,794,140
Al- wadeeah current and other deposit accounts 47,531,708,061 38,658,697,588
Bills payable 4,216,038,334 2,863,395,095
Mudaraba perpetual bond 3,000,000,000 3,000,000,000

Other liabilities 19(a) 21,903,809,274 16,713,922,449
Deferred tax liabilities 20(a) 238,628,851 192,664,063
Total liabilities 442,988,126,704 361,761,849,327
Capital/shareholders’ equity 39,661,364,763 27,613,754,893

Paid - up capital 12,509,640,000 10,007,712,000
Statutory reserve 12,423,662,342 10,004,426,808
Other reserves 11,694,797,161 4,585,606,725
Retained earnings 37(a) 3,033,205,973 3,015,952,005
Non-controlling interest 37(b) 59,287 57,355
Total liabilities & shareholders’ equity 482,649,491,467 389,375,604,220

Consolidated Balance Sheet
31.12.2012 31.12.2011
Off-balance Sheet Items Notes
Taka Taka
Contingent liabilities
Acceptances & endorsements - -

Letters of guarantee 7,297,485,550 7,302,242,465
Irrevocable letters of credit (including back to back bills) 87,161,261,558 86,901,920,097
Bills for collection 15,571,833,223 17,727,239,489
Other contingent liabilities 13,600,712 1,489,529,264
Total 110,044,181,043 113,420,931,315
Other commitments
Documentary credits, short term and trade related transactions - -
Forward assets purchased and forward deposits placed - -
Undrawn note issuance, revolving and underwriting facilities - -
Undrawn formal standby facilities, credit lines and other commitments - -
Total - -
Total off-balance sheet items including contingent liabilities 110,044,181,043 113,420,931,315
The annexed notes form an integral part of these financial statements.
Prof. NRM Borhan Uddin Ph.D Md. Abdus Salam FCA, FCS
Director Director
Humayun Bokhteyar, ACPA, FCA Mohammad Abdul Mannan

Director Managing Director
This is the consolidated balance sheet referred to in our separate report of even date.
Dhaka A. Qasem & Co. ACNABIN


Consolidated Profit & Loss Account
For the year ended 31 December 2012
2012 2011
Operating income Notes
Taka Taka
Investment income 43,672,225,981 32,019,532,444

Profit paid on mudaraba deposits (25,870,425,237) (18,401,218,085)
Net investment income 17,801,800,744 13,618,314,359
Income from investments in shares & securities 27(a) 484,361,836 331,004,637
Commission, exchange & brokerage income 28(a) 5,260,647,661 5,297,455,786
Other operating income 29(a) 1,122,169,884 876,633,643
Total operating income 24,668,980,125 20,123,408,425
Operating expenses
Salary & allowances 5,961,421,881 4,655,983,050
Rent, taxes, insurances, electricity etc. 30(a) 655,576,460 507,063,897
Legal expenses 13,479,293 15,257,288
Postage, stamps and telecommunication etc. 31(a) 111,528,843 94,267,115
Stationery, printing and advertisement etc. 32(a) 267,730,060 198,418,476
Chief executive’s salary & fees 5,280,000 5,280,000
Directors’ fees & expenses 33(a) 10,066,840 9,530,986
Shari‘ah supervisory committee’s fees & expenses 2,584,829 2,749,283
Auditors’ fees 2,168,000 1,593,400
Charges on investment losses - -
Depreciation and repair to bank’s assets 35(a) 504,441,086 409,590,979
Zakat expenses 324,772,772 262,929,404
Other expenses 36(a) 1,029,710,622 1,128,991,237
Total operating expenses 8,888,760,686 7,291,655,115
Profit/ (loss) before provision 15,780,219,439 12,831,753,310
Provision for investments & off- balance sheet items 3,502,625,602 2,384,314,796
Provision for diminution in value of investments in shares 30,969,670 289,077,029
Other provisions 9,441,066 -
Total provision 3,543,036,338 2,673,391,825
Total profit/(loss) before taxes 12,237,183,101 10,158,361,485
Provision for taxation for the period
Current tax 19.6(a) 6,574,464,832 5,504,252,091
Deferred tax 20(b) 45,964,788 29,515,743
Net profit/ (loss) after tax 5,616,753,481 4,624,593,651
Net profit after tax attributable to: 5,616,753,481 4,624,593,651
Equity holders of IBBL 37(a) 5,616,751,549 4,624,597,748
Non-controlling interest 1,932 (4,097)
Retained earnings from previous year 3,015,952,005 2,624,924,708
Add: Net profit after tax (attributable to equity holders of IBBL) 5,616,751,549 4,624,597,748
Profit available for appropriation 8,632,703,554 7,249,522,456
Appropriation: 8,632,703,554 7,249,522,456
General reserve (22,205,793) (430,484,615)
Dividend 3,202,467,840 2,594,592,000
Retained earnings 3,033,205,973 3,015,952,005
Consolidated earnings per share 39(a) 4.49 3.70
Director Director

This is the consolidated profit & loss account referred to in our separate report of even date.


Consolidated Cash Flow Statement
2012 2011
Cash flows from operating activities Note
Taka Taka

Income/ dividend receipt from investments in shares & securities 484,361,836 331,004,637
Fees & commission receipt in cash 5,260,647,661 5,297,455,786
Recovery from written off investments 107,882,331 77,081,305
Payments to employees (5,966,701,881) (4,661,263,050)
Cash payments to suppliers (317,323,649) (237,072,771)
Income tax paid (4,888,001,666) (4,055,740,794)
Receipts from other operating activities 1,014,287,553 799,552,338
Payments for other operating activities (2,189,000,103) (2,020,929,003)
(i) Operating profit before changes in operating assets 11,307,952,826 10,594,792,392
Changes in operating assets and liabilities
Increase/decrease of statutory deposits - -
Increase/decrease of net trading securities - -
Increase/decrease of placement to other banks - -
Increase/decrease of investments to customers (67,080,159,717) (44,065,049,847)
Increase/decrease of other assets 109,479,065 (467,914,988)
Increase/decrease of deposits from other banks (437,641,214) 501,270,743
Increase/decrease of deposits received from customers 76,377,684,681 47,970,108,822
Increase/decrease of other liabilities account of customers - -
Increase/decrease of trading liabilities - -
Increase/decrease of other liabilities 284,254,073 417,328,401
(ii) Cash flows from operating assets and liabilities 9,253,616,888 4,355,743,131
Net cash flows from operating activities (A)=(i+ii) 20,561,569,714 14,950,535,523
Cash flows from investing activities
Proceeds from sale of securities 1,173,962,731 -
Payment for purchase of securities/BGIIB (11,257,091,966) (2,903,755,860)
Payment for purchase of securities/membership - -
Purchase/sale of property, plants & equipments (960,861,899) (729,734,467)
Purchase/sale of subsidiaries - -
Net cash flows from investing activities (B) (11,043,991,134) (3,633,490,327)
Cash flows from financing activities
Receipts from issue of debt instruments - -
Payment for redemption of debt instruments - -
Receipts from issuing ordinary share/ rights share - 48,000
Dividend paid in Cash (700,539,840) -
Net cash flows from financing activities (C) (700,539,840) 48,000
Net increase/(decrease) in cash (A+B+C) 8,817,038,740 11,317,093,196
Add/(less): effects of exchange rate changes on cash & cash equivalent (3,303,771) -
Add: cash & cash equivalents at beginning of the year 57,485,210,751 46,168,117,555
Cash & cash equivalents at the end of the year 42(a) 66,298,945,720 57,485,210,751
Director Director

This is the consolidated cash flow statement referred to in our separate report of even date.


Consolidated Statement of Changes in Equity
(Amount in Taka)
Assets Revaluation
Share Statutory General/ other Retained Non-controlling
Particulars Paid-up capital revaluation reserve of Total
premium reserve reserves * earnings interest
reserve securities
1 2 3 4 5 6 7 8 9 10(2+3+4+5+6+7+8+9)
Balance as at 01 January 2012 10,007,712,000 1,989,633 10,004,426,808 184,645,772 4,308,071,320 90,900,000 3,015,952,005 57,355 27,613,754,893
Changes in accounting policy restated balance - - - - - - - - -
Surplus/ (deficit) on account of revaluation of
- - - - 7,190,900,000 - - - 7,190,900,000
properties
- - - - - (56,200,000) - - (56,200,000)
investments (shares & securities)
Currency translation differences - - - (3,303,771) - - - - (3,303,771)
Net gain and losses not recognized in the income
- - - - - - - - -
statement
Net profit for the period - - - - - - 5,616,751,549 1,932 5,616,753,481
Transfer to reserve - - 2,419,235,534 (22,205,793) - - (2,397,029,741) - -
Dividend: -
Bonus shares 2,501,928,000 - - - - - (2,501,928,000) - -
Cash dividend - - - - - - (700,539,840) - (700,539,840)
Issue of share capital - - - - - - - - -
Total shareholders’ equity as on 31 December
12,509,640,000 1,989,633 12,423,662,342 159,136,208 11,498,971,320 34,700,000 3,033,205,973 59,287 39,661,364,763
2012
Add: Mudaraba perpetual bond - - - - - - - - 3,000,000,000
Add: General provision for unclassified investments
- - - 5,036,350,000 - - - - 5,036,350,000
and off- balance sheet items
Adjustment for currency translation differences - - - 3,303,771 - - - - 3,303,771
Less: 50.00% of assets revaluation reserve - - - - (5,749,485,660) - - - (5,749,485,660)
Less: 50.00% of revaluation reserve of securities - - - - - (17,350,000) - - (17,350,000)
Total equity as on 31 December 2012 12,509,640,000 1,989,633 12,423,662,342 5,195,486,208 5,749,485,660 17,350,000 3,033,205,973 59,287 41,934,182,874
*Note : General / other reserves 2012 2011

General reserve 152,645,772 583,130,387
Dividend equalization account 32,000,000 32,000,000
Annual Report 2012

Total 184,645,772 615,130,387
203
Consolidated Statement of Changes in Equity
For the year ended 31 December 2011 (Amount in Taka)
Assets Revaluation
Share Statutory General/ other Retained Non-controlling
premium reserve reserves * earnings interest
reserve securities

1 2 3 4 5 6 7 8 9 10(2+3+4+5+6+7+8+9)
Balance as at 01 January 2011 7,413,120,000 1,989,633 7,934,963,742 615,130,387 4,313,460,000 621,000,000 2,624,924,708 13,452 23,524,601,922
Changes in accounting policy restated balance - - - - - - - - -
Surplus/ (deficit) on account of revaluation of properties - - - - - - - -
- - - - (5,388,680) (530,100,000) - - (535,488,680)
investments (shares & securities)
Currency translation differences - - - - - - - - -
Net gain and losses not recognized in the income
- - - - - - - - -
statement
Net profit for the period - - - - - - 4,624,597,748 (4,097) 4,624,593,651
Transfer to reserve - - 2,069,463,066 (430,484,615) - (1,638,978,451) - -
Dividend:
Bonus shares 2,594,592,000 - - - - - (2,594,592,000) - -
Cash dividend - - - - - - - - -
Issue of share capital - - - - - - - 48,000 48,000
Total shareholders’ equity as on 31 December 2011 10,007,712,000 1,989,633 10,004,426,808 184,645,772 4,308,071,320 90,900,000 3,015,952,005 57,355 27,613,754,893
Add: Mudaraba perpetual bond - - - - - - - - 3,000,000,000
Add: General provision for unclassified investments
- - - 5,116,000,000 - - - - 5,116,000,000
and off- balance sheet items
Less: 50.00% of assets revaluation reserve - - - - (2,154,035,660) - - - (2,154,035,660)
Less: 50.00% of revaluation reserve of securities - - - - - (45,450,000) (45,450,000)
Total equity as on 31 December 2011 10,007,712,000 1,989,633 10,004,426,808 5,300,645,772 2,154,035,660 45,450,000 3,015,952,005 57,355 33,530,269,233
Prof. NRM Borhan Uddin Ph.D Humayun Bokhteyar, ACPA, FCA Md. Abdus Salam FCA, FCS Mohammad Abdul Mannan
Director Director Director Managing Director
This is the consolidated statement of changes in equity referred to in our separate report of even date.

Balance Sheet
31.12.2012 31.12.2011
Property and Assets Notes
Taka Taka
Cash in hand 7.0 41,774,009,647 40,631,897,477

Cash in hand (including foreign currency) 6,308,271,684 4,655,980,193
currency)
Balance with other banks & financial institutions 8.0 23,048,348,207 15,577,309,475
In Bangladesh 15,955,976,932 11,864,372,819
Outside Bangladesh 7,092,371,275 3,712,936,656
Placement with banks & other financial institutions - -
Investments in shares & securities 9.0 27,010,073,770 16,932,273,770
Government 23,504,977,770 13,927,177,770
Others 3,505,096,000 3,005,096,000
Investments 10.0 372,920,722,887 305,840,563,170
General investments etc. 340,479,756,413 287,911,767,521
Bills purchased & discounted 11.0 32,440,966,474 17,928,795,649
Fixed assets including premises 12.0 14,808,228,329 7,100,192,269
Other assets 13.0 2,974,933,877 3,109,886,617
Non - banking assets - -
Total property and assets 482,536,316,717 389,192,122,778

Liabilities
Placement from banks & other financial institutions - -
Deposits & other accounts 14.0 417,844,142,245 341,853,672,959
Mudaraba savings deposits 151,012,262,458 132,051,082,776
Mudaraba term deposits 97,278,542,378 65,167,293,216
Other mudaraba deposits 15.0 117,807,137,348 103,114,794,140
Al- wadeeah current and other deposit accounts 16.0 47,530,161,727 38,657,107,732
Bills payable 17.0 4,216,038,334 2,863,395,095
Mudaraba perpetual bond 18.0 3,000,000,000 3,000,000,000
Other liabilities 19.0 21,698,433,977 16,345,905,454
Deferred tax liabilities 20.0 238,230,992 192,330,992
Total liabilities 442,780,807,214 361,391,909,405
Capital/ shareholders’ equity 39,755,509,503 27,800,213,373

Paid - up capital 21.2 12,509,640,000 10,007,712,000
Statutory reserve 22.0 12,423,662,342 10,004,426,808
Other reserves 23.0 11,694,797,161 4,585,606,725
Retained Earnings 3,127,410,000 3,202,467,840
Total liabilities & shareholders’ equity 482,536,316,717 389,192,122,778

Balance Sheet
31.12.2012 31.12.2011
Off-balance Sheet Items Notes
Taka Taka
Acceptances & endorsements - -
Letters of guarantee 24.0 7,297,485,550 7,302,242,465
Irrevocable letters of credit (including back to back bills) 87,161,261,558 86,901,920,097
Bills for collection 15,571,833,223 17,727,239,489
Other contingent liabilities 13,600,712 1,489,529,264
Total 110,044,181,043 113,420,931,315
Other commitments
Documentary credits, short term and trade related transactions - -
Forward assets purchased and forward deposits placed - -
Undrawn note issuance, revolving and underwriting facilities - -
Undrawn formal standby facilities, credit lines and other
- -
commitments
Total - -
Total off-balance sheet items including contingent liabilities 110,044,181,043 113,420,931,315
Director Director

This is the balance sheet referred to in our separate report of even date.



Profit & Loss Account
2012 2011
Operating income Notes
Taka Taka
Investment income 25.0 43,672,225,981 32,019,532,444

Profit paid on mudaraba deposits 26.0 (25,870,425,237) (18,401,218,085)
Net investment income 17,801,800,744 13,618,314,359
Income from investments in shares & securities 27.0 431,970,748 289,370,090

Commission, exchange & brokerage income 28.0 5,249,699,981 5,284,102,499
Other operating income 29.0 991,873,131 808,291,910
Total operating income 24,475,344,604 20,000,078,858
Operating expenses
Salary & allowances 5,951,305,071 4,646,993,224
Rent, taxes, insurances, electricity etc. 30.0 652,494,766 503,637,923
Legal expenses 13,479,293 15,257,288
Postage, stamps and telecommunication etc. 31.0 111,417,653 94,161,200
Stationery, printing and advertisement etc. 32.0 267,547,822 198,119,152
Chief executive’s salary & fees 5,280,000 5,280,000
Directors’ fees & expenses 33.0 10,066,840 9,254,986
Shari‘ah supervisory committee’s fees & expenses 34.0 2,584,829 2,749,283
Auditors’ fees 2,070,000 1,567,500
Charges on investment losses - -
Depreciation and repair to bank’s assets 35.0 500,228,968 407,057,924
Zakat expenses 324,772,772 262,929,404
Other expenses 36.0 1,025,852,252 1,121,440,847
Total operating expenses 8,867,100,266 7,268,448,731
Profit/ (loss) before provision 15,608,244,338 12,731,630,127
Provision for investments & off- balance
3,502,625,602 2,384,314,796
sheet items (Note 19.2, 19.3 & 19.4)
Provision for diminution in value of investments in shares - -
Other provisions 19.5 9,441,066 -
Total provision 3,512,066,668 2,384,314,796
Total profit/(loss) before taxes 12,096,177,670 10,347,315,331
Current tax 19.6 6,525,837,929 5,476,469,040
Deferred tax 20.0 45,900,000 29,400,000
Net profit/ (loss) after tax 5,524,439,741 4,841,446,291
Retained earnings from previous year 3,202,467,840 2,594,592,000
Add: Net profit after tax 5,524,439,741 4,841,446,291
Profit available for appropriation 8,726,907,581 7,436,038,291
Appropriation: 8,726,907,581 7,436,038,291
General reserve (22,205,793) (430,484,615)
Dividend 3,202,467,840 2,594,592,000
Retained earnings 37.0 3,127,410,000 3,202,467,840
Earnings per share (EPS) 39.0 4.42 3.87
Director Director

This is the profit & loss account referred to in our separate report of even date.

Cash Flow Statement
2012 2011
Cash flows from operating activities Note
Taka Taka

Income/ dividend receipt from investments in shares & securities 431,970,748 289,370,090
Fees & commission receipt in cash 5,249,699,981 5,284,102,499
Recovery from written off investments 107,882,331 77,081,305
Payments to employees (5,926,585,071) (4,652,273,224)
Cash payments to suppliers (317,141,411) (236,773,447)
Income tax paid (4,869,763,379) (4,045,822,646)
Receipts from other operating activities 883,990,800 731,210,605
Payments for other operating activities (2,180,853,649) (2,010,895,339)
(i) Operating profit before changes in operating assets 11,181,001,094 10,500,703,787
Increase/decrease of statutory deposits - -
Increase/decrease of net trading securities - -
Increase/decrease of placement to other banks - -
Increase/decrease of investments to customers (67,080,159,717) (42,615,432,144)
Increase/decrease of other assets 134,952,740 (499,447,139)
Increase/decrease of deposits from other banks (437,641,214) 501,270,743
Increase/decrease of deposits received from customers 76,428,110,500 47,971,410,361
Increase/decrease of other liabilities account of customers - -
Increase/decrease of trading liabilities - -
Increase/decrease of other liabilities 184,387,305 536,615,012
(ii) Cash flows from operating assets and liabilities 9,229,649,614 5,894,416,833
Net cash flows from operating activities (A)=(i+ii) 20,410,650,708 16,395,120,620
Proceeds from sale of securities - -
Payment for purchase of securities/BGIIB (10,134,000,000) (5,193,563,150)
Payment for purchase of securities/membership - -
Purchase/sale of property, plants & equipments (959,656,195) (725,646,669)
Purchase/sale of subsidiaries - -
Net cash flows from investing activities (B) (11,093,656,195) (5,919,209,819)
Receipts from issue of debt instruments - -
Payment for redemption of debt instruments - -
Receipts from issuing ordinary share/ rights share - -
Dividend paid in Cash (700,539,840) -
Net cash flows from financing activities (C) (700,539,840) -
Net increase/(decrease) in cash (A+B+C) 8,616,454,673 10,475,910,801
Add/(Less): effects of exchange rate changes on cash & cash equivalent (3,303,771) -
Add: cash & cash equivalents at beginning of the year 56,209,206,952 45,733,296,151
Cash & cash equivalents at the end of the year 42.0 64,822,357,854 56,209,206,952
Director Director

This is the cash flow statement referred to in our separate report of even date.


Statement of Changes in Equity
(Amount in Taka)
Assets Revaluation
Share Statutory General/ other Retained
premium reserve reserves * earnings
reserve securities
1 2 3 4 5 6 7 8 9 (2+3+ 4+5+6+7+ 8)
Balance as at 01 January 2012 10,007,712,000 1,989,633 10,004,426,808 184,645,772 4,308,071,320 90,900,000 3,202,467,840 27,800,213,373
Changes in accounting policy restated
- - - - - - - -
balance
Surplus/ (deficit) on account of
- - - - 7,190,900,000 - 7,190,900,000
revaluation of properties
revaluation of investments (shares & - - - - - (56,200,000) - (56,200,000)
securities)
Currency translation differences - - - (3,303,771) - - - (3,303,771)
Net gain and losses not recognized in
- - - - - - - -
the income statement
Net profit for the period - - - - - - 5,524,439,741 5,524,439,741
Transfer to reserve - - 2,419,235,534 (22,205,793) - - (2,397,029,741) -
Dividend:
Bonus shares 2,501,928,000 - - - - - (2,501,928,000) -
Cash dividend - - - - - - (700,539,840) (700,539,840)
Issue of share capital - - - - - - - -
Total shareholders’ equity as on 31
12,509,640,000 1,989,633 12,423,662,342 159,136,208 11,498,971,320 34,700,000 3,127,410,000 39,755,509,503
December 2012
Add: Mudaraba perpetual bond - - - - - - - 3,000,000,000
Add: General provision for unclassified
- - - 5,036,350,000 - - - 5,036,350,000
investments and off- balance sheet items
Adjustment for currency translation
- - - 3,303,771 - - - 3,303,771
differences
Less: 50.00% of assets revaluation
- - - - (5,749,485,660) - - (5,749,485,660)
reserve
Less: 50.00% of revaluation reserve of
- - - - - (17,350,000) - (17,350,000)
securities
Total equity as on 31 December 2012 12,509,640,000 1,989,633 12,423,662,342 5,198,789,979 5,749,485,660 17,350,000 3,127,410,000 42,028,327,614
*Note : General / other reserves 2012 2011

General reserve 152,645,772 583,130,387
Dividend equalization account 32,000,000 32,000,000
Total 184,645,772 615,130,387
Annual Report 2012

209
(Amount in Taka)
Assets Revaluation
Share Statutory General/ other Retained

premium reserve reserves earnings
reserve securities
1 2 3 4 5 6 7 8 9 (2+3+ 4+5+6+7+ 8)
Balance as at 01 January 2011 7,413,120,000 1,989,633 7,934,963,742 615,130,387 4,313,460,000 621,000,000 2,594,592,000 23,494,255,762
Changes in accounting policy restated
- - - - - - - -
balance
- - - - - - - -
revaluation of properties
revaluation of investments (shares & - - - - (5,388,680) (530,100,000) - (535,488,680)
securities)
Currency translation differences - - - - - - - -
Net gain and losses not recognized in
- - - - - - - -
the income statement
Net profit for the period - - - - - - 4,841,446,291 4,841,446,291
Transfer to reserve - - 2,069,463,066 (430,484,615) - - (1,638,978,451) -
Dividend:
Bonus shares 2,594,592,000 - - - - - (2,594,592,000) -
Cash dividend - - - - - - - -
Issue of share capital - - - - - - - -
Total shareholders’ equity as on 31
10,007,712,000 1,989,633 10,004,426,808 184,645,772 4,308,071,320 90,900,000 3,202,467,840 27,800,213,373
December 2011
Add: Mudaraba perpetual bond - - - - - - - 3,000,000,000
Add: General provision for unclassified
- - - 5,116,000,000 - - - 5,116,000,000
investments and off- balance sheet items
Less: 50.00% of assets revaluation reserve - - - - (2,154,035,660) - - (2,154,035,660)
Less: 50.00% of revaluation reserve of
- - - - - (45,450,000) - (45,450,000)
securities
Total equity as on 31 December 2011 10,007,712,000 1,989,633 10,004,426,808 5,300,645,772 2,154,035,660 45,450,000 3,202,467,840 33,716,727,713
This is the statement of changes in equity referred to in our separate report of even date.

Liquidity Statement
Assets & liabilities analysis
More than 5
Particulars Up to 1 Month 1 - 3 Months 3 - 12 Months 1 - 5 years Total 31.12.2012 Total 31.12.2011
years
7=(2 + 3 + 4 +
1 2 3 4 5 6 8
5 + 6)
ASSETS
Cash in hand 6, 308,271,684 - - - - 6,308,271,684 4,655,980,193
Balance with other banks & financial institutions 34,524,086,170 14,800,000,000 9,190,000,000 - - 58,514,086,170 51,553,226,759
Placement with Banks & other Financial Institutions - - - - - - -
Investments (in shares & securities) 54,700,000 4,000,000,000 15,434,000,000 4,000,000,000 3,521,373,770 27,010,073,770 16,932,273,770
General investments etc. 31,791,392,460 73,313,354,365 108,070,736,432 82,343,342,943 77,401,896,687 372,920,722,887 305,840,563,170
Fixed assets including premises (land & building), furniture and fixtures - - 305,043,651 406,658,946 14,096,525,732 14,808,228,329 7,100,192,269
Other assets 209,265,864 1,589,625,634 615,435,843 374,868,902 185,737,634 2,974,933,877 3,109,886,617
Non - banking assets - - - - - - -
Total assets 72,887,716,178 93,702,979,999 133,615,215,927 87,124,870,791 95,205,533,823 482,536,316,717 389,192,122,778
LIABILITIES
Placement from banks & other financial institutions - - - - - - -
Deposits 50,491,777,908 86,118,226,950 117,306,521,119 86,900,534,735 77,027,081,533 417,844,142,245 341,853,672,959
Other accounts - - - - - - -
Provision & other liabilities 1,742,432,651 518,436,527 1,816,543,853 5,967,635,497 11,653,385,449 21,698,433,977 16,345,905,454
Deferred tax liability/ (assets) - - - - 238,230,992 238,230,992 192,330,992
Mudaraba perpetual bond - - - - 3,000,000,000 3,000,000,000 3,000,000,000
Total liabilities 52,234,210,559 86,636,663,477 119,123,064,972 92,868,170,232 91,918,697,974 442,780,807,214 361,391,909,405
Net liquidity gap 20,653,505,619 7,066,316,523 14,492,150,955 (5,743,299,441) 3,286,835,849 39,755,509,503 27,800,213,373
This is the liquidity statement referred to in our separate report of even date.

Annual Report 2012

211
Notes to the consolidated financial statements
1.0 The Bank and its activities

1.1 Islami Bank Bangladesh Limited (“the Bank”/”IBBL”) was established as a Public Limited Banking
Company in Bangladesh in 1983 as the first interest free Shari‘ah based Scheduled Commercial
Bank in the South East Asia. Naturally, its modus operandi is substantially different from those of other
conventional Commercial Banks. The Bank conducts its business on the Shari‘ah principles of Mudaraba,
Musharaka, Bai-Murabaha, Bai-Muajjal, Hire Purchase under Shirkatul Melk, Bai-Salam and Bai-as-
Sarf etc. There is a Shari‘ah Supervisory Committee in the Bank who ensures that the activities of the
Bank are being conducted on the precepts of Islam. The Shari‘ah Supervisory Committee consists
of prominent Shari‘ah scholars, reputed Bankers, renowned Lawyers and eminent Economists.
There are two Stock Exchanges in Bangladesh viz. Dhaka Stock Exchange Limited and Chittagong Stock
Exchange Limited and the shares of the Bank are listed with both the Stock Exchanges. The Bank carries
out its business activities through its Head Office in Dhaka, 14 Zonal Offices and 276 branches including 30
SME/Agriculture branches in Bangladesh. The Principal place of business is the Registered Office at Islami
Bank Tower, 40, Dilkusha Commercial Area, Dhaka-1000, Bangladesh.
These financial statements as at and for the year ended 31 December 2012 include the consolidated financial
statements and the separate financial statements of the Bank. The consolidated financial statements comprise
the financial statements of the Bank and its subsidiaries (mentioned in Note - 1.4, together referred to as “the
Companies”).
1.2 Nature of business/principal activities of the Bank
1.2.1 Commercial banking services
All kinds of commercial banking services are provided by the Bank to the customers following the principles of
Islamic Shari‘ah, the provisions of the Bank Company Act, 1991, Bangladesh Bank’s directives and directives
of other regulatory authorities.
1.2.2 Islamic micro-finance
Islamic micro-finance represents micro-finance and the Islamic finance industry. Under Islamic micro-finance,
major focus is given on improvement of living standard of poor people. The projects are closely monitored so
that the members are really benefitted. IBBL provides this services under the umbrella of Rural Development
Scheme (RDS) and Urban Poor Development Scheme (UPDS).
1.2.3 Mobile financial services -”mCash”
IBBL has launched mobile financial services from 27 December 2012 under the name “Islami Bank mCash”
as per Bangladesh Bank approval (reference no. DCMPS/PSD/37/(W)/2012-321 dated 14 June 2012). Islami
Bank mCash offers different services through Mobile phone that include free and quick opening of customer
account, deposit and withdrawal of cash money, fund transfer from one account to another, receiving
remittance from abroad, knowing account balance and mini-statement, giving and receiving salary, mobile
recharge and payment of utility bill, merchant bill payment etc.
1.3 Off-shore banking unit (OBU)
Bangladesh Bank has approved the operation of Off-Shore Banking Unit (OBU) of Islami Bank Bangladesh
Limited located at Head Office Complex Branch- Dhaka, Uttara Branch- Dhaka and Agrabad Branch-
Chittagong through letter no. BRPD (P-3)744(111)/2010-1032 dated 28 March, 2010. The Bank commenced
the operation of its Off-shore Banking Unit from 08.02.2011 at Head Office Complex Branch, Dhaka, and
from 27.09.2011 at Agrabad Branch, Chittagong. Operations of OBU located at Uttara Branch, Dhaka has
not been started yet. Due to having different functional currency (Note 2.3), the operation of OBU has been
considered as “foreign operation” for reporting purposes and relevant financial reporting standards have been
applied accordingly (Note 3.2.2).

1.4 Subsidiaries of the Bank
1.4.1
As per Securities and Exchange Commission’s (SEC) Letter No. SEC/Reg/CSE/MB/ 2009/444 dated
20.12.2009 and approval of Bangladesh Bank through Letter No. BRPD (R-1)717/2010-47 dated 07.02.2010;
IBBL established a subsidiary Company named “Islami Bank Securities Limited” to operate stock broker and
stock dealer activities.
The share capital of Islami Bank Securities Ltd. is Tk. 2,700,000,000/- divided into 2,700,000 shares of
Tk.1,000/ each out of which share capital of IBBL is Tk. 2,699,946,000/- divided into 2,699,946 shares of
Tk.1,000/- each which represent 99.998% of total share of the subsidiary Company.
IBSL was incorporated on 22.03.2010 and date of commencement of business was 23.05.2010. Required
capital was transferred to IBSL on 25.05.2010 which is operating business under the license issued by the
Securities & Exchange Commission (SEC).
As a stock broker, IBSL acts as an agent in the purchase and sale of Shari‘ah approved listed securities
and realizes commission on transactions in accordance with approved commission schedule. Financial
Statements of the Company are shown at Annexure - E.
1.4.2 Islami Bank Capital Management Limited (IBCML)
As per Bangladesh Bank BRPD Circular No. 12 dated 14.10.2009 and approval of Bangladesh Bank through
Letter No. BRPD (R-1)717/2010-47 dated 07.02.2010, IBBL established another subsidiary Company named
“Islami Bank Capital Management Limited” to operate portfolio management, underwriting, issue management
etc. IBCML was incorporated on 01.04.2010 and required capital was transferred on 06.07.2010.
The share capital of Islami Bank Capital Management Ltd. is Tk.300,000,000/- divided into 300,000 shares
of Tk.1,000/ each out of which share capital of IBBL is Tk.299,993,000/- divided into 299,993 shares of
Tk.1,000/- each which represent 99.998% of total share of the subsidiary Company.
Permission of Bangladesh Securities and Exchange Commission (BSEC) is yet to be received for operation
of IBCML. Financial Statements of the Company are shown at Annexure - F.
1.4.3 IBBL Exchange Singapore Pte. Ltd.
Another subsidiary of Islami Bank Bangladesh Limited named ‘IBBL Exchange Singapore Pte. Ltd.’ is under
process to incorporate in Singapore for money-remittance, changing, transmitting and doing all matters and
things incidental thereto under the Companies Act, CAP. 50 of the Republic of Singapore.
2.0 Basis of preparation

2.1 Statement of compliance
The operations of the Bank and its subsidiaries are in strict compliance with the rules of Islamic Shari‘ah.
The consolidated financial statements and the separate financial statement of the Bank have been prepared
basically as per provisions of the “Guidelines for Islamic Banking” issued by Bangladesh Bank through
BRPD Circular No. 15 dated 09.11.2009 with reference to the provisions of the Bank Company Act, 1991
as amended by Bangladesh Bank BRPD Circular No.14 dated 25.06.2003 & Bangladesh Bank’s other
circulars/instructions and in accordance with International Financial Reporting Standards (IFRSs) adopted as
Bangladesh Financial Reporting Standards (BFRSs) by the Institute of Chartered Accountants of Bangladesh
(ICAB); the Companies Act, 1994; the Securities and Exchange Rules, 1987; Dhaka and Chittagong Stock
Exchanges’ Listing Regulations and other laws and rules applicable in Bangladesh, Standards issued by
the Accounting and Auditing Organization for Islamic Financial Institutions (AAOIFI), as a member of that
organization.
In case the requirement of guidelines and circulars issued by Bangladesh Bank differ with those of other
regulatory authorities and financial reporting standards, the guidelines and circulars issued by Bangladesh
Bank prevails. As such the Bank has departed from those contradictory requirements of BFRSs in order to
comply with the rules and regulations of Bangladesh Bank which are disclosed below:


i) Provision on investments and off-balance sheet exposures
As per BAS 39 “Financial Instruments: Recognition and Measurement”, an entity should start the
impairment assessment by considering whether objective evidence of impairment exists for financial
assets that are individually significant. For financial assets are not individually significant, the
assessment can be performed on an individual or collective (portfolio) basis and investments should
be presented net of provisions. Instead of complying with the above, the Bank has made provision on
investments and off-balance sheet exposures as per Bangladesh Bank circulars (Note -3.16.1) and
provision on investments has been presented separately as a liability in the financial statements.
ii) Other comprehensive income
As per BAS 1 “Presentation of Financial Statements”, Other Comprehensive Income is a component
of financial statements or the elements of Other Comprehensive Income (OCI) are to be included in
a Single Statement of Comprehensive Income. Instead the Bank prepare it financial statements as
per prescribed guidelines of Bangladesh Bank where there is no scope to include the OCI nor the
elements of OCI in a single Profit & Loss Account. However elements of OCI, if any, are shown in the
statements of changes in equity.
iii) Financial instruments - presentation and disclosure
In several cases Bangladesh Bank guidelines categorize, recognize, measure and present financial
instruments differently from those prescribed in BAS 39 “Financial Instruments: Recognition and
Measurement”, BFRS 7 “Financial Instruments: Disclosures” and BAS 32 “Financial Instruments:
Presentation”. In those cases Bangladesh Bank guidelines have been followed.
iv) Financial guarantees
As per BAS 39 “Financial Instruments: Recognition and Measurement” financial guarantees are
contracts that require an entity to make specified payments to reimburse the holder for a loss it incurs
because a specified debtor fails to make payment when due in accordance with the terms of a debt
instrument. Financial guarantee liabilities are recognized initially at their fair value, and the initial fair
value is amortized over the life of the financial guarantee. Whereas as per Bangladesh Bank, financial
guarantees such as Letter of Credit (L/C), Letter of Guarantee (L/G) should be treated as off-balance
sheet items. No liability is recognized for the guarantee except the cash margin.
v) Cash flow statement
As per BAS 7 “Statement of Cash Flows”, Cash flow statement can be prepared either in direct
method or in indirect method. The presentation is selected to present these cash flows in a manner
that is most appropriate for the business or industry. Bangladesh Bank guidelines have been followed
instead of BAS 7.
vi) Balance with Bangladesh Bank
Balance with Bangladesh Bank Principal Account as Cash Reserve Requirment (CRR) should be
treated as other assets as it is not available for use in the day to day operations as per BAS 7
“Statement of Cash Flows”. But as per Bangladesh Bank guideline it has been treated as cash and
cash equivalents.
Vii) Revenue
As per BAS 18 “Revenue”, revenue should be recognized on accrual basis but due to the unique
nature of Islamic Banks, income from investment under Mudaraba, Musharaka, Bai-Salam and Bai-
as-Sarf modes is accounted for on realization basis as per AAOIFI and Bangladesh Bank guidelines.
[Note 4 includes Compliance with Financial Reporting Standards as applicable in Bangladesh]
2.1.1 Authorization of the financial statements for issue
The consolidated financial statements and the separate financial statements of the Bank have been authorized
for issue by the Board of Directors on 28 March 2013.

2.1.2 New standards adopted but not yet effective
A number of new International Financial Reporting Standards (IFRSs) have been adopted by The Institute of
Chartered Accountants of Bangladesh (ICAB) as Bangladesh Financial Reporting Standards (BFRSs) which
are effective on or after 01 January 2013 and hence not been applied in preparing these financial statements.
The new BFRSs are as follows:
BFRS 10 Consolidated Financial Statements
BFRS 11 Joint Arrangements
BFRS 12 Disclosure of Interests in Other Entities and
BFRS 13 Fair Value Measurement
BFRS 10 introduces a single control model to determine whether an investee should be consolidated. BFRS
11 is not expected to have any impact on the Bank, because it does not have interest in joint ventures.
BFRS 12 brings together into a single standard all the disclosure requirements about an entity’s interests in
subsidiaries, joint arrangements, associates and unconsolidated structured entities. It requires the disclosure
of information about the nature, risks and financial effects of these interests. BFRS 13 provides a single
source of guidance on how fair value is measured, and replaces the fair value measurement guidance that is
currently dispersed throughout BFRSs.
2.2 Basis of measurement
The financial statements have been prepared on the historical cost basis except for the following material
items:
- Land is recognized at cost at the time of acquisition and subsequently measured at fair value following
revaluation model as per BAS 16 “Property Plant & Equipment”.
- Investments in quoted shares are revalued at the year end at market price as per Bangladesh Bank
circular.
2.3 Functional and presentation currency
The consolidated financial statements and the separate financial statements of the Bank are presented in
Bangladeshi Taka (Taka/Tk./BDT) which is the functional currency of the Bank and its subsidiaries except
Off-shore Banking Unit (OBU) where functional currency is US Dollar (USD).
All financial information presented in Taka has been rounded to the nearest integer, except when otherwise
indicated.
2.4 Use of estimates and judgments
The preparation of the consolidated financial statements and the separate financial statements of the Bank in
conformity with BFRSs require management to make judgments, estimates and assumptions that affect the
application of accounting policies and the reported amount 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 period affected.
Information about significant areas of estimation uncertainty and critical judgments in applying accounting
policies that have the most significant effect on the amounts recognized and presented in the consolidated
financial statements and the separate financial statements of the Bank are included in following notes/
statements:
a) Note 19.6 Current tax liabilities
b) Note 20.0 Deferred tax liabilities
c) Note 35.0 Depreciation
d) Note 19.2-19.5 Provisions for investments and other assets
e) Note 23.1 Asset revaluation reserve
f) Liquidity statement Assets & liabilities analysis

2.5 Cash flow statement
Cash Flow Statement is prepared in accordance with BAS 7 “Statement of Cash Flows”, and as per “Guidelines
for Islamic Banking” issued by Bangladesh Bank through BRPD Circular No. 15 dated 09.11.2009 and
BRPD Circular No.14 dated 25.06.2003. The Statement shows the structure of changes in cash and cash
equivalents during the financial year.
2.6 Statement of changes in equity
Statement of Changes in Equity has been prepared in accordance with BAS 1 “Presentation of Financial
Statements”, and as per “Guidelines for Islamic Banking” issued by Bangladesh Bank through BRPD Circular
No. 15 dated 09.11.2009 and BRPD Circular No.14 dated 25.06.2003.
2.7 Liquidity statement
Liquidity Statement has been prepared in accordance with the residual/remaining maturity of Assets and
Liabilities as on 31 December 2012 and as per “Guidelines for Islamic Banking” issued by Bangladesh Bank
through BRPD Circular No. 15 dated 09.11.2009 and BRPD Circular No.14 dated 25.06.2003 as per the
following basis:
i) Balance with other banks and financial institutions, etc are on the basis of their respective maturity term;
ii) Investments in shares & securities are on the basis of their respective maturity;
iii) General investments are on the basis of their recovery/repayment schedule;
iv) Fixed assets are on the basis of their useful lives;
v) Other assets are on the basis of their realization/amortization;
vi) Deposits and other accounts are on the basis of their maturity and payments;
vii) Provisions and other liabilities are on the basis of their adjustment/settlement;
viii) Due to perpetual in nature/maturity, Mudaraba perpetual bond (MPB) is reported under maturity more
than 5 (five) years.
2.8 Reporting period
These financial statements of the Bank and its subsidiaries cover one calendar year from 1 January 2012 to
31 December 2012.
3.0 Significant accounting policies

The accounting policies set out below have been applied consistently to all periods presented in the
consolidated financial statements and the separate financial statements of the Bank (together referred to as
‘financial statements’) except provision for investment which have been changed due to new circular issued
by Bangladesh Bank (Note 3.16.1).
Certain comparative amounts in the financial statements have reclassified and rearranged to conform to the
current year’s presentation.
3.1 Basis of consolidation
3.1.1 Subsidiaries
Subsidiaries are entities controlled by the Parent. Control exists when the Parent has the power to govern the
financial and operating policies of an entity, so as to obtain economic benefits from its activities. The financial
statements of subsidiaries are included in the consolidated financial statements from the date that control
commences until the date that control ceases.
3.1.2 Transactions eliminated on consolidation
Inter-company balances and transactions, and any unrealized income and expenses (except for foreign
currency transaction gains and losses) arising from inter-company transactions are eliminated in preparing
consolidated financial statements. Unrealized losses are eliminated in the same way as unrealized gains,
but only to the extent that there is no evidence of impairment. The investments in shares of subsidiaries held
by the Bank in the separate financial statements are eliminated against the corresponding share capital of
subsidiaries in the consolidated financial statements.

3.2 Foreign currency
3.2.1 Foreign currency transactions
Transactions in foreign currencies are translated into the respective functional currencies (Bangladeshi Taka
in case of IBBL Main Operations and US Dollar in case of OBU) at the spot exchange rates ruling at the
date of transactions as per BAS 21 “The Effects of Changes in Foreign Exchange Rates”. Monetary assets
and liabilities held in US Dollar at the reporting date are retranslated into the functional currency in BDT at
the weighted average revaluation rate of inter-bank market as determined by Bangladesh Bank. Monetary
assets and liabilities denominated in other foreign currencies at the reporting date are first translated into US
Dollar at buying rates of New York closing of the previous day and then retranslated from US Dollar into the
functional currencies in the same specified above.
Non-monetary assets and liabilities denominated in foreign currencies that are measured at fair value are
retranslated to the functional currency at the exchange rate at the date that the fair value was determined.
Non-monetary items in a foreign currency that are measured based on historical cost are translated using the
exchange rate at the date of the transaction.
Foreign exchange differences (rates at which transactions were initially recorded and the rate prevailing on
the reporting date/date of settlements) of the monetary items are recognized in the profit and loss.
3.2.2 Foreign operations
The assets and liabilities of foreign operations (Note - 1.3) are translated to Bangladeshi Taka at spot exchange
rates prevailing at the reporting date. The income and expenses of foreign operations are translated at
spot exchange rates at the date of transactions as long as practicable otherwise average rate of exchange
has been used. Foreign currency differences arising on translation are recognized in other comprehensive
income and presented in the foreign currency translation reserve (translation reserve) in equity.
3.3 Revenue
3.3.1 Investment income
Income from general investments is accounted for on accrual basis except investments under Musharaka,
Mudaraba, Bai-Salam and Bai-as-Sarf modes of Investment. Income from investment under Mudaraba,
Musharaka, Bai-Salam and Bai-as-Sarf modes is accounted for on realization basis. Besides, fees and
commission income are recognized when earned. The Bank does not charge any rent during the gestation/
interim period of investment against Hire Purchase under Shirkatul Melk (HPSM) mode of investment but it
fixes the sale price of the assets at a higher level in such a way to cover its expected rate of return. Such
income is recognized on realization basis.
Profit/Rent/Compensation accrued on Special Mention Account and Classified Investments are suspended
and accounted for as per circulars issued by the Bangladesh Bank in this regard from time to time.
Profit on deposits with other banks & financial institutions is accounted for on accrual basis.
3.3.1.1 Sharing of investment income
In case of investment, Mudaraba fund gets preference over cost free fund. The investment income earned
through deployment of Mudaraba Fund is shared by the Bank and the Mudaraba depositors at the pre-agreed
ratio.
3.3.2 Income from investment in Bangladesh Government Islamic Investment Bond (BGIIB) & Islamic Inter-
bank Fund Market (IIFM)
Profit from investment in Bangladesh Government Islamic Investment Bond (BGIIB) & Islamic Inter-bank
Fund Market (IIFM) is accounted for on accrual basis.
3.3.3 Fees, commission and exchange income
Fees, Commission and Exchange Income on services provided by the Bank are recognized as and when the
related services are performed. Commission charged to customers on letter of credit and letter of guarantee
are credited to Income at the time of effecting the transactions.

3.3.4 Dividend income
Dividend income from investments is accounted for when the right to receive income is established.
3.4 Income tax expenses
Income tax expenses comprise current and deferred taxes. Income taxes are recognized in profit or loss
except to the extent that it relates to items recognized directly in equity, in which case it is recognized in
equity.
3.4.1 Current tax
Current tax is the expected tax payable on the taxable income for the year, using tax rates enacted or
substantially enacted at the reporting date and any adjustment to the tax payable in respect of previous years.
Provision for current income tax has been made on taxable income of the Bank as per following rates:
Type of income 2012 2011

Business income 42.50% 42.50%
Dividend income 20.00% 20.00%
3.4.2 Deferred tax

Deferred tax is recognized in compliance with BAS 12 “Income Taxes” and BRPD Circular no. 11 dated 12
December 2011, providing for temporary differences between the carrying amounts of assets and liabilities
for financial reporting purposes and amounts used for taxation purposes. Deferred tax is measured at the tax
rates that are expected to be applied to the temporary differences when they reverse, based on the laws that
have been enacted or substantively enacted by the date of balance sheet. Deferred tax assets and liabilities
are offset as there is a legally enforceable right to offset current tax liabilities and assets, and they relate to
income taxes levied by the same tax authority on the same taxable entity.
A deferred tax asset is recognized to the extent that it is probable that future taxable profits will be available
against which the deductible temporary difference can be utilized. Deferred tax assets are reviewed at each
date of balance sheet and are reduced to the extent that it is no longer probable that the related tax benefit
will be realized.
3.5 Zakat
Zakat is paid by the Bank at the rate of 2.58% (instead of 2.50% as the Bank maintains its financial statements
following Gregorian Year) and calculated on the closing balances of Share Premium, Statutory Reserve,
General Reserve and Dividend Equalization Accounts as per guidelines of AAOIFI, Shari‘ah Supervisory
Committee and Banglades Bank guidelines.
Zakat is charged in the Profit & Loss Account of the Bank as per “Guidelines for Islamic Banking” issued by
Bangladesh Bank through BRPD Circular No. 15 dated 09.11.2009 and guidelines of AAOIFI.
Zakat on Paid up Capital and Deposits is not paid by the Bank, since it is the responsibility of the Shareholders
and Depositors respectively.
3.5.1 Management and other expenses
Expenses incurred by the Bank are recognized on accrual basis.
3.6 Cash and cash equivalents
Cash and cash equivalents include notes and coins in hand, balances held with Bangladesh Bank and its agent
bank and highly liquid financial assets that are subject to an insignificant risk of changes in their fair value.
3.7 Investments
Investments are stated in the Balance Sheet net off profit receivable and unearned income.
Profit Receivable – the amount of unexpired portion of profit charged on murabaha investment at the time of
sale of good/ services to customer/ client.
Unearned Income- the amount of unrealized portion of profit/ value addition of fixed assets under Hire
Purchase Under Shirkatul Melk (HPSM) investment for gestation period.
However, provision for investments are not net-off with investments.

3.8 Investment in shares and securities
Investments in share and securities (other than government treasury securities) are initially measured at fair
value (which is actually the cost) and subsequently accounted for depending on their classification as either
held to maturity, fair value through profit or loss, or available for sale.
Investment in Bangladesh Government Islamic Investment Bond (BGIIB) is measured both initially and
subsequently at cost, which is also the fair value.
IBBL can not invest in interest-based government securities like T-bond, T-bill etc. So the instructions and
circulars related to accounting for those instruments are not applicable for the Bank.
3.8.1 Held to Maturity (HTM)
Held-to-maturity investments are non-derivative assets with fixed or determinable payments and fixed
maturity that the entity has the positive intent and ability to hold to maturity, and which are not designated as
at fair value through profit or loss or as available for sale. These are measured at amortized cost at each year
end by taking into account any discount or premium on acquisition. Any increase or decrease in value of such
investments is recognized in equity.
3.8.2 Held for Trading (HFT)/Fair value through profit or loss (FVTPL)
Some investment in shares and securities are designated at fair value, with fair value changes recognized
immediately in profit or loss.
3.8.3 Available-for-sale (AFS)
Available-for-sale investments are non-derivative investments that are designated as available-for-sale or
are not classified as another category of financial assets. Available-for-sale investments comprise generally
equity securities. Unquoted equity securities whose fair value cannot reliably be measured are carried at
cost. All other available-for-sale investments are carried at fair value and changes recognized in equity
(Note 3.18.5).
Dividend income is recognized in profit or loss when the right to receive income is established. Other fair
value changes, other than impairment losses are presented as reserve in equity.
3.9 Investment in subsidiaries
Investments in subsidiaries are accounted for under cost method of accounting in the Bank’s Financial
Statements in accordance with BAS 27 “Consolidated and Separate Financial Statements”.
3.10 Fixed assets
3.10.1 Recognition and measurement
Items of fixed assets excluding land and building are measured at cost less accumulated depreciation and
accumulated impairment losses. Land and building is recognized at cost at the time of acquisition and
subsequently measured at revalued amounts which is the fair value at the time of revaluation done by
independent valuer and any surplus on revaluation is shown as equity component until the disposal of asset,
as per BAS 16 “Property, Plant & Equipment” and Bangladesh Bank BCD Circular Letter No. 12 & 18 dated
20 April 1993 & 15 June 1993 respectively and BRPD Circular No.10 dated 25 November 2002 & BRPD
Circular No.09 dated 31 December 2008. Deficit arising on subsequent revaluation is adjusted against the
balance in the Revaluation reserve account. Revaluation is carried out with sufficient regularity to ensure that
the carrying amount of assets does not differ materially from their fair value.
Cost includes expenditures that are directly attributable to the acquisition of assets. The cost of self-
constructed assets includes the following:
- the cost of materials and direct labour;
- any other cost directly attributable to bringing the asset to a working condition for the intended use;
- when the Companies have an obligation to remove the asset or restore the site, an estimate of the
costs of dismantling and removing the items 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 that
equipment.
Any gain or loss on disposal of an item of fixed assets (calculated as the difference between the net proceeds
from disposal and the carrying amount of the item) is recognized in profit or loss.
3.10.2 Subsequent costs
Subsequent costs is capitalized only when it is probable that the future economic benefits associated with the
costs will flow to the entity. Ongoing repairs and maintenance is expensed as incurred.
3.10.3 Depreciation
Items of fixed assets are depreciated from the date that they are installed and are ready for use, or in respect
of internally constructed assets, from the date that the asset is completed and ready for use.
Depreciation is calculated to write-off the cost/revalued amount of items of fixed assets less their estimated
residual values using either of straight-line (SLM) or reducing balance method (RBM) over their estimated
useful lives and recognized in profit and loss. Land is not depreciated.
The estimated rate of depreciation for the current and comparative years of fixed assets are as follows:
Items Method Rates

Building Reducing balance 2.50%
Furniture and fixtures -Do- 10.00%
Mechanical appliances -Do- 20.00%
Books -Do- 30.00%
Motor vehicles Straight-line 20.00%
Computers -Do- 25.00%
Depreciation methods, useful lives and residual values are reviewed at each reporting date and adjusted if
appropriate.
3.10.4 Capital work in progress
Fixed assets that is being under construction/acquisition is accounted for as capital work in progress until
construction/acquisition is completed and measured at cost. The work in progress is transferred to cost of that
fixed assets when the construction is completed and it becomes available to use.
3.10.5 Derecognition
An item of fixed assets is derecognized upon disposal or when no economic benefits are expected from its
use or disposal. Any gain or loss arising on derecognition of the asset is recognized in profit or loss.
3.11 Lease payments
Payments made under operating leases are recognized in profit or loss on a straight-line basis over the term
of the lease.
3.12 Other assets
Other assets include all other financial assets, other income receivable, advance against expenses etc.
3.13 Non-banking assets
Non-banking assets are acquired on account of the failure of a client to repay the investment in time after
receiving the decree from the court regarding the right and title of the mortgaged property.
3.14 Impairment of non-financial assets
The carrying amounts of the non-financial assets, other than investment property and deferred tax 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 cash-generating unit (CGU) exceeds its recoverable amount.

3.15 Deposits and other accounts
Deposit and other accounts include Al Wadeeah current deposit as well as savings, term and other Mudaraba
deposits. Deposits by customers and banks are recognized when the Bank enters into contractual agreements
with the counterparties. These items are brought to Financial Statements at the gross value of the outstanding
balance.
3.15.1 Profit paid on deposits
As per Mudaraba principle, agreement between the Mudaraba depositors and the Bank, the Mudaraba
depositors are entitled to get minimum 65% of the investment income earned through deployment of
Mudaraba Fund as per weightage assigned to each type of Mudaraba deposit. In the year 2012, IBBL paid
70.04% of Investment Income earned through deployment of Mudaraba Fund. Moreover, in some Mudaraba
Deposits, additional rate was allowed over the rate as per weightage. Mudaraba Depositors do not share any
income derived from various banking services where the use of fund is not involved and any income derived
from Investing Bank’s Equity and other Cost Free Fund. Al-Wadeeah Depositors do not share any income of
the Bank.
Profit is paid/provided to Mudaraba Deposit accounts at provisional rate on half-yearly/yearly basis considering
overall growth, performance and profitability of the Bank during the year. Final Rates of profit of any accounting
year are declared after finalization of Shari‘ah Inspection report and certifying the Investment Income of the Bank
by the statutory auditors.
3.16 Provisions
Provision is recognized if, as a result of a past event, the Companies has a present legal or constructive
obligation that can be estimated reliably, and it is probable that an outflow of economic benefits would
be required to settle the obligation, in accordance with the BAS 37 “Provisions, Contingent Liabilities and
Contingent Assets”.
3.16.1 Provision for investments and off-balance sheet exposures
Provision for Investment for the year 2012 is made as per latest instruction of Bangladesh Bank through BRPD
Circular No.14 dated 23 September 2012 and BRPD Circular No.19 dated 27 December 2012. However,
provision for investment for previous year was made as per instruction of Bangladesh Bank through BCD
Circular No.34 dated 16.11.1989, BCD Circular No.20 dated 27.12.1994, BCD Circular No.12 dated 04.09.1995,
BRPD Circular No.16 dated 06.12.1998, BRPD Circular No. 09 dated 18.06.2002, BRPD Circular No. 05 dated
05.06.2006 and BRPD circular No. 32, dated 27.10.2010. Investments have not been classified against which
order staying classification has been issued by the Hon’ble High Court.
Provision for off-balance sheet exposures for the year 2012 is also made as per latest instruction of Bangladesh
Bank through BRPD Circular No.14 dated 23 September 2012 and BRPD Circular No.19 dated 27 December
2012. However, the same for previous year was made as per BRPD circular No.08 dated 07.08.2007 and BRPD
Circular No.10 dated 18.09.2007.
The rates of provision for the year 2012 and 2011 are given below:
2012 2011
Particulars Classification
UC SMA SS DF BL UC SMA SS DF BL
Small and Medium Enterprise (SME) 0.25% 5% 20% 50% 100% 1% 5% 20% 50% 100%
Financing
Consumer Investment for House Building 2% 5% 20% 50% 100% 2% 5% 20% 50% 100%
& Professional
Other than House Building & 5% 5% 20% 50% 100% 5% 5% 20% 50% 100%
Professional
All Other (Except Short-term Agricultural and 1% 5% 20% 50% 100% 1% 5% 20% 50% 100%
Micro-Credits)
Short-term Agricultural and Micro-Credits 5% 100% 5% 100%
Investment to Stock Dealers & Stock Broker 2% 2%
Off Balance Sheet Items 1% 1%

3.16.2 Provision for other assets
Provision for other assets is made as per instruction of Bangladesh Bank through BRPD circular No.14 dated
25.06.2001.
3.16.3 Provision for nostro accounts
Provision for nostro accounts is to be made on the unreconciled debit balance of nostro account over
more than 3 months as on the reporting date in accordance with the guideline of Foreign Exchange Policy
Department of Bangladesh Bank, FEPD Circular no. FEPD (FEMO) / 01/2005-677 dated 13 September
2005. There was no unreconciled entries outstanding for more than 3 months and no provision has been
made in this regard.
3.17 Employee benefits
The Bank provides various long-term and short-term benefits to the employees under different schemes.
3.17.1 Defined contribution plan
A defined contribution plan is a post-employment benefit plan under which an entity pays fixed contributions
into a separate entity and has no legal or constructive obligation to pay further amounts. Obligations for
contributions to defined contribution plan are recognized as personnel expense in profit or loss in the
periods during which related services are rendered by employees. The Bank maintains one funded defined
contribution plan for its employees - Provident fund.
3.17.1.1 Provident fund
The Provident Fund is for the regular and confirmed employees who works for a minimum period of 5(five)
years at IBBL and it came into force with effect from 1st day of March 1986. The fund receives contributions
@ 10% of the basic pay both from employees and employer. Tk. 3,075.85 million was available in the IBBL
Employees Provident Fund as at 31 December 2012.
3.17.2 Defined benefit plans
A defined benefit plan is a post-employment benefit plan other than a defined contribution plan. The Bank’s
net obligation in respect of defined benefit plans is calculated separately for each plan by estimating the
amount of future benefit that employees have earned in return for their service in the current and prior
periods. The Bank has two funded defined benefit plans - Gratuity fund and Superannuation fund.
3.17.2.1 Gratuity fund
The Gratuity Fund for the regular and confirmed employees of IBBL was established on 1st day of March
1986. The employees who serve at least 7 (seven) years at IBBL are normally entitled to get gratuity
equivalent to 1(one) month’s basic pay. Employees served for minimum 12 years get 1.5 (one and a half)
months’ basic pay and employees served for 20 years get 2 (two) months’ basic pay. The Fund balance stood
at Tk.2,328.28 million as at 31 December 2012. Actuarial valuation of the gratuity fund was done up to the
year 2010 by ACFIN (Actuarial & Financial Consultants).
3.17.2.2 Superannuation fund
The Fund came into force with effect from the 19th June, 2008. It was established for financial help to
the members of the IBBL Employees’ Superannuation Fund and their families in case of retirement, death,
physical disability of employee while in service or of any incidence of like nature acceptable to the Board of
Trustees and retirement from the service. Tk. 20 million has been provided by the Bank during the year 2012
to the Fund. The Fund balance was Tk. 367.28 million as at 31 December 2012. Actuarial valuation of the
superannuation fund was done up to the year 2011 by ACFIN (Actuarial & Financial Consultants).
3.17.3 Short-term employee benefits
Short-term employee benefit obligations are measured on an undiscounted basis and are expensed as the
related service is provided. A liability is recognized for the amount expected to be paid if the Companies
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.

3.17.4 Other employee benefits
Other employee benefits include which are not included in short-term employee benefits, post-employment
benefits and other termination benefits.
3.17.4.1 Benevolent fund
The Benevolent Fund for the regular and confirmed employees of Islami Bank Bangladesh Limited was
established in the year 1986. This Fund is mainly used for payment of scholarship to the meritorious students
among the children of IBBL’s officers and sub-staff, to allow short term quard/grant to meet some unexpected
and certain needs of the staff of IBBL like accident, clinical treatment, marriage ceremony of the employees
and their dependents etc. Tk. 10.00 million has been provided by the Bank during the year 2012 to the Fund.
The Fund balance was Tk. 124.93 million as at 31 December 2012.
3.18 Share capital and reserves
3.18.1 Capital
3.18.1.1 Authorized Capital
Authorized Capital is the maximum amount of share capital that the Bank is authorized to raise as per its
Memorandum and Articles of Association.
3.18.1.2 Paid-up Capital
Paid-up Capital represents total amount of shareholders’ capital that has been paid in full by the shareholders.
Shareholders are entitled to receive dividend as approved from time to time in the Annual General Meeting.
3.18.2 Share Premium
Share premium arose from sale of some un-subscribed Right Share for the year 1996 at Market price and can
be utilized as per section 57 of the Companies Act, 1994.
3.18.3 Statutory reserve
As per section 24 of the Bank Company Act, 1991, at least 20% or more of the net profit before tax is
transferred to statutory reserve every year.
3.18.4 Assets revaluation reserve
This represents the difference between the book value and the re-valued amount of premises (Land and
Building) of the Bank as assessed by professional valuers in the year 2000, 2002, 2003, 2004, 2005, 2006,
2009 and 2012 as per guideline issued by Bangladesh Bank, which was reviewed by the statutory auditors.
This reserve is not distributable. However, to calculate Capital Adequacy Ratio (CAR), 50% of the same is
considered as a component of supplementary capital as per Bangladesh Bank BCD Circular Letter No. 12 &
18 dated 20 April 1993 & 15 June 1993 respectively, BRPD Circular No.10 dated 25 November 2002, BRPD
Circular No. 09 dated 31 December 2008 and BRPD Circular No. 24 dated 03 August 2010.
3.18.5 Revaluation reserve of securities
Investment in shares of Bangladesh Shipping Corporation is held for fulfilment of Statutory Liquidity Reserve
(SLR) as per Bangladesh Bank Letter No. BCD (P)744(23)(II)/1030 dated 08.11.1983, BRPD Circular No.15
dated 31.10.2005, DOS Circular Letter No.10 dated 11.09.2006, BRPD Circular No.03 dated 12.03.2008
and DOS Circular Letter No.05 dated 26.05.2008. The shares have been revalued as on 30.12.2012 on the
basis of closing market price of Dhaka Stock Exchange Limited (DSE). The surplus is credited to Revaluation
Reserve on securities account (Note - 3.8.3) and 50% of the same has been taken as a component of
Supplementary Capital as per Bangladesh Bank BRPD Circular No.03 dated 12.03.2008 and BRPD Circular
No.09 dated 31.12.2008 and shown in the Statement of Changes in Equity as on 31 December 2012 as per
Bangladesh Bank guidelines. However, deficit arising on such revaluation is debited to Revaluation reserve
on securities account.
3.18.6 Non-controlling interest
Non-controlling interest is the portion of the profit or loss and net assets of the subsidiaries of IBBL (Islami
Bank Securities Limited & Islami Bank Capital Management Limited) that is not owned by the Parent
(IBBL). The magnitude of the non-controlling interest in the subsidiary Company is generally less than 50%
of outstanding shares. It is, however, possible (e.g. through special voting rights) that a controlling interest

requiring consolidation be achieved without exceeding 50% ownership as per the BAS 27 “Consolidated and
Separate Financial Statements”. Non-controlling interest belongs to other investors and is reported on the
consolidated balance sheet of the parent Company (IBBL) to reflect the claim on assets belonging to other,
non-controlling shareholders. Also, non-controlling interest is reported on the consolidated profit and loss
account as a share of profit belonging to non-controlling shareholders.
3.19 Subordinated debt-Mudaraba Perpetual Bond (MPB)
Mudaraba Perpetual Bond (MPB) was issued by the Bank as per approval of Bangladesh Bank Letter
No. BRPD (P-1)661/14(a)/2006-1437 dated 07.05.2006 and Securities and Exchange Commission Letter
No. SEC/CI/CPLC-118/2006/385 & SEC/CI/RPO-01/2007/386 both dated 10.06.2007. It is treated as a
component of Supplementary Capital as Subordinated Debt. The instrument having face value of Tk.1,000
each is subordinated to the claims of other creditors and depositors. In the case of liquidation the subordinated
debt holders would be paid just before paying to the shareholders assuming there are assets to distribute
after all other liabilities and debts have been paid. The Mudaraba Perpetual Bond (MPB) is perpetual in
nature i.e. never ending maturity.
3.20 Other liabilities
Other liabilities comprise items such as provision for investment, provision for taxes, profit/rent suspense,
accrued expenses, etc. Other liabilities are recognized in the balance sheet as per guidelines of Bangladesh
Bank, Bangladesh Financial Reporting Standards (BFRS) etc.
3.21 Contingent liabilities
Any possible obligation that arises from past events and the existence of which will be confirmed only by
the occurrence or non-occurrence of one or more uncertain future events not wholly within the control of the
Bank; or
Any present obligation that arises from past events but is not recognized because, it is not probable that an
outflow of resources embodying economic benefits will be required to settle the obligation, is considered as
contingent liability.
Contingent liabilities are not recognized but disclosed in the financial statements unless possibility of an
outflow of resources embodying economic benefits is reliably estimated.
Contingent assets are not recognized in the financial statements as this may result in the recognition of
income which may never be realized.
3.22 Off-balance sheet items
Off-balance sheet items are disclosed under Contingent liabilities & other commitments and required provision
on Off-balance sheet exposures have been made in accordance with Bangladesh Bank guidelines (Note
3.16.1).
3.23 Earnings per share (EPS)
The Bank presents basic and diluted (when dilution is applicable) earnings per share (EPS) for its ordinary
shares. Basic EPS is calculated by dividing the profit or loss attributable to ordinary shareholders of the Bank
with the weighted average number of ordinary shares outstanding during the period, adjusted for the effect
of change in number of shares for bonus issue, share split and reverse split. Diluted EPS is determined by
adjusting the profit or loss attributable to ordinary shareholders and the weighted average number of ordinary
shares outstanding, for the effects of all dilutive potential ordinary shares. However, dilution of EPS is not
applicable for these financial statements as there was no dilutive potential ordinary shares during the relevant
periods. Hence no Diluted EPS has been calculated. Consolidated basic EPS has also been calculated and
presented in the same manner.
3.24 Segment reporting
An operating segment is a component of the Bank 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
Bank’s other components. All operating segments’ operating results are reviewed regularly by the Bank’s
Management (as being the chief operating decision maker) to make decisions about resources to be allocated
to the segment and to assess its performance, and for which discrete financial information is available.

Segment results that are reported to the Managment include items directly attributable to a segment as well
as the items that can be allocated on a reasonable basis.
Details about segment reporting has been given at Annexure - D
3.25 Off-setting
The value of any asset or liability as shown in the balance sheet is not off-set by way of deduction from
another liability or assets unless there exist legal right thereof. Financial assets and financial liabilities are
offset and the net amount is presented in the balance sheet when there is a legally enforceable right to offset
the recognized amounts and there is an intention to settle on a net basis, or realize the asset and settle the
liability simultaneously.
3.26 Materiality and aggregation
Each material class of similar items is presented separately in the financial statements. Items of dissimilar
nature or function are presented separately unless they are immaterial as permitted by BAS 1 “Presentation
of Financial Statements”.
3.27 Inter-branch transactions
Transactions with regard to inter branches are reconciled regularly and there is no difference in this account
as on 31 December 2012.
3.28 Revenue, gains, expenses & losses prohibited by Shari‘ah
Income which is irregular (doubtful) as per Shari‘ah is not included in the distributable income of the Bank. Bank
charges compensation on overdue Bai-Murabaha and Bai-Muazzal investments. Such compensation is also
not included in the distributable income of the Bank. The total amount of doubtful income and compensation
are included in investment income and temporarily used to create provision for bad and doubtful investments
as per decision of Shari‘ah Supervisory Committee. Since doubtful income and compensation are included in
investment income, applicable income tax on these items is duly paid to the Govt. account. However, realized
amount of doubtful income and compensation are transferred/utilized for charitable purposes.
Interest received from the balances held with foreign banks and from foreign currency clearing account
with Bangladesh Bank are not credited to income, since it is not permissible as per Shari‘ah. These are
transferred/utilized for charitable purposes after payment of income tax thereon.
3.29 Dividend payments
Final dividend is recognized when it is approved by the shareholders in Annual General Meeting (AGM). The
proposed dividend for the year 2012, therefore, has not been recognized as a liability however disclosed in
the balance sheet in accordance with BAS 10 “Events after the Reporting Period”. Dividend payable to the
Bank’s shareholders is recognized as a liability and deducted from the shareholders’ equity in the period in
which the shareholders’ right to receive the payment is established.
3.30 Events after the reporting period
All material events after the reporting period that provide additional information about the Companies’/Bank’s
position at the balance sheet date are reflected in the financial statements as per BAS 10 “Events after the
Reporting Period”. Events after the reporting period that are not adjusting events are disclosed in the notes
when material.
3.31 Risk management
The risk of a bank is defined as the possibility of losses, financial or otherwise. The Risk Management of the
Bank covers 6 (six) Core Risk Areas of Banking industry i.e. Investment (Credit) Risk Management, Foreign
Exchange Risk Management, Asset-Liability Management, Prevention of Money Laundering, Internal Control
& Compliance Risk Management and Information & Communication Technology Risk Management. The
risk management procedures in the core risk areas has been devised in line with the core risk management
guideline of Bangladesh Bank.
As per instruction of Bangladesh Bank, IBBL formed a Risk Management Wing (RMW) to formulate risk
assessment and management policies, methodologies, guidelines and procedures for risk identification, risk
measurement, risk monitoring, deciding acceptable level of risk and risk controlling.

The prime objective of the Risk Management Wing is that the Bank takes well calculative Business Risk
Policy for safeguarding the Bank’s capital, its financial resources and profitability from various risks. In this
context, the Bank implemented all the guidelines of Bangladesh Bank as under:
3.31.1 Investment (Credit) Risk Management
Investment (Credit) risk is one of the major risks faced by the Bank. This can be described as potential loss
arising from the failure of counter party to perform as per contractual agreement with the Bank. The failure
may result from unwillingness or inability of the counter party in discharging his / her financial obligation.
Therefore, Bank’s Investment (Credit) risk management activities have been designed to address all these
issues.
3.31.2 Foreign Exchange Risk Management
Foreign Exchange Risk is the current or prospective risk to earnings and capital arising from adverse
movements in currency exchange rates. The Bank is exposed to profit rate risk and settlement risk on account
of its foreign exchange business. Foreign Exchange business includes trading of foreign currency, purchase
and sell of foreign currencies relating to import, export, remittances and other ancillary services. IBBL is
dealing with a substantial volume of foreign trade and remittance business of the country which exposes the
Bank to foreign exchange risk. IBBL has adopted foreign exchange risk manual through which the foreign
exchange operation are dealt with.
Foreign Exchange risks are measured and monitored by the Treasury Division. Treasury Division consists of
separate Front Office, Back Office and Mid Office. The Treasury Front Office (Dealing Room) independently
performs the deals and the Treasury Back Office is responsible for verification of the deals and passing of
their entries in the books of account.
The Foreign Exchange Risk is minimized through proper market analysis, real time pricing of Foreign
Exchange, fixation of different market related limits (daylight, overnight, stop loss and management action
trigger) and counter parties credit limits set by the management and ensure adherence to the limits by the
Treasury Front Office. All Foreign Exchange transactions are revalued at weighted average exchange rate
as provided by Bangladesh Bank at the end of each month. All Nostro Accounts are reconciled regularly and
outstanding entries are reviewed by the management for its settlement/recompilation. The open position
maintained by the bank at the end of the day is within the stipulated limit prescribed by the Bangladesh Bank.
Treasury Front Office (Dealing Room) independently performs the deals and the Treasury Back Office is
responsible for verification of the deals and passing of their entries in the books of accounts. All foreign
exchange transactions are revalued at weighted average exchange rate as provided by Bangladesh Bank
at the end of each month. All Nostro accounts are reconciled on a monthly basis and outstanding beyond 30
days is reviewed by the Management for its settlements/ reconciliation.
3.31.3 Asset Liability Management
The Asset Liability Committee (ALCO) of the Bank monitors balance sheet risk, liquidity risks, investment
deposit ratio (IDR), deposit mix, investment mix, gap analysis etc under the leadership of MD/CEO of the
Bank. The Balance Sheet risk is defined as potential change in earnings due to change in rate of profit, foreign
exchange rates which are not trading nature. Asset Liability Committee (ALCO) reviews liquidity requirement
of the Bank, the maturity of assets and liabilities, deposit and investment pricing strategy, sensitivity of assets
and liabilities, management indicators/ratios and the liquidity contingency plan. The primary objective of
the ALCO is to monitor and avert significant volatility in Net Investment Income (NII), investment value and
exchange earnings.
3.31.4 Prevention of Money Laundering
Anti Money Laundering risk is defined as the loss of reputation and expenses incurred as penalty for being
negligent in prevention of money laundering. For mitigating the risks, the Bank has formed 05(five) members
Central Compliance Unit (CCU) under the leadership of the Chief Anti Money Laundering Compliance Officer
(CAMLCO) at Head Office. Anti Money Laundering Compliance Units are also functioning at Zonal Offices
and Branches, where the transactions of the accounts are independently reviewed to verify Suspicious
Transaction Reports (STRs). A Manual for prevention of money laundering was developed and approved
by the Board of Directors. IBBL has introduced (a) Uniform Account Opening Form (AOF), (b) Know Your
Customer (KYC) Profile and (c) Transaction Profile (TP) in the Bank as per instructions of Bangladesh Bank.

IBBL had already issued 61 (Sixty One) circulars providing necessary instructions for Prevention of Money
Laundering activities and also for combating of Financial Terrorism.
Moreover, IBBL had conducted a good number of training sessions/workshops to create awareness and
development of the skill of the officials for identifying suspicious transactions. IBBL introduced a Policy
Guideline to combat terrorist financing in the light of Anti Terrorism Act (Amendment) Act, 2012 coupled with
the Money Laundering Prevention Act- 2012 approved by the Board of Directors of the Bank.
IBBL has exclusively completed the KYC procedures of Legacy Accounts (accounts opened before 30 April
2002). To establish fruitful Anti Money Laundering drive at branch level, IBBL introduced AML Rating systems
such as excellent/good/satisfactory/marginal through self Assessment Report & Independent Testing
Procedure as per instruction of Bangladesh Bank.
3.31.5 Internal Control and Compliance
Operational loss may arise from errors and frauds due to lack of internal control and compliance. With
a view to overcome such lapses and verification of Asset quality, quality of customer’s service, overall
security arrangement operational efficiency and regulatory issues as guided through different circulars,
manuals from Head Office and other regulatory bodies, Bank organize its management through Internal
Control & Compliance Wing (ICCW). ICCW consists of three Divisions namely (1) Audit & Inspection
Division, (2) Compliance Division and (3) Monitoring Division to develop sound, sustainable and secured
growth of the Bank.
(1) Audit & Inspection Division
Internal Audit and Inspection Division undertakes periodical and special audit of the Branches,
Divisions and Departments of Head Office to review operational effectiveness and internal & external
compliance requirements. Bank has introduced Risk Based Internal Audit and grading of the branches.
The Audit Committee of the Board subsequently review the lapses identified by Audit and Inspection
Division. The Audit Committee also review Bangladesh Bank Inspection Reports and other issues
indicated in the Bangladesh Bank guidelines. Necessary steps/measures are taken on the basis of
observation & suggestion of the Committee.
The Audit & Inspection Division conducts investigations against complaints received from customers,
anonymous person, management & others and submits the reports to the competent authority.
Periodical Inspection reports of Zonal Heads, Shari‘ah Inspections & Branch Manager’s self Audit
reports are reviewed by the Division regularly and necessary guidance and suggestion are given with
continuous follow-up there against.
(2) Compliance Division
The Compliance Division handles the ‘regulatory issues of Bangladesh Bank as well as other regulatory
bodies’ and submits ‘status report on regulatory compliance’ quarterly to the Audit Committee as per
BRPD Circular No.12 dated 23.12.2002.
The Compliance Division ensures the Bank complies with all regulatory requirements while conducting
its day to day business. The Compliance Division maintains liaison with the regulatory bodies for any
regulatory changes and notify the same to all concerned.
(3) Monitoring Division
This division performs the following:
i) Assesses the risk of the functional areas of the Branches described in the Departmental
Control Function Checklist (DCFCL) and determines the frequency of Audit/Inspection of the
branches based on the gravity of risks involved.
ii) Monitors the Internal Control Functions through the Quarterly Operations Report (QOR) and
other mechanisms.
iii) Checks the Completion of Investment Documentation.

3.31.6 Information and Communication Technology Risk Management
The Bank has adequately addressed Information and Communication Technology (ICT) Risk Management.
It is an in-depth exercise and continual process. The (ICT) Risk Management exercise mainly includes
minimizing financial and image loss to the institution in all events such as natural disasters, technological
failures, human errors etc. The Bank uses own developed Core Banking Software to perform all types of
transactions including local/ online/ internet in a secured way. To take care of its core banking system, a
separate security module has been incorporated in the software which manages different roles for different
users. All financial transactions can be tracked for future audit purposes.
The Bank uses Central Data Centre to replicate transactions in branches in case of data failure or
inconsistencies. Data travelling through network uses encryption and decryption mechanism.
In line with the Bangladesh Bank directives, the bank has approved its own ICT, policies for its operations and
services. Under these policy guidelines, a security policy has also been worked out. To abide by and adhere to
what is laid down in the policy; the implementation has been made through Active Directory Services (ADS),
Password Policy, Kerberos Policy, Audit Policy, Group Policy, User Rights, Permission Policy etc. In order
to secure network resources from public network, the Bank has introduced Virtual Private Network (VPN),
Access Control List (ACL), IP filtering and TCP/UDP service blocking through router and firewall devices. It
has already centralized the administrative control to access the network, mailing system and internet. IBBL
has introduced Business Continuity Plan (BCP) for its entire network and trained the officials to cope up with
any contingencies.
3.32 Credit rating report
Credit Rating Information and Services Ltd. CRISL (a joint venture rating agency of Rating Agency Malaysia
Berhad (RAM), JCR-VIS Credit Rating Company Ltd., Pakistan, Prime Commercial Bank Ltd., Pakistan and
Local Corporate/ Sponsors, Bangladesh) was engaged by the Bank for the purpose of rating the Bank since
2002 as per Bangladesh Bank BRPD Circular No.06 dated 5 July 2006. CRISL assigned AA+ rating in the
long term (indicates high safety and high credit quality) and ST-1 in the short term (highest certainty of timely
repayment) to IBBL based on the financials up to 31 December 2011.
3.33 Regulatory and legal compliance
Among others, the Bank complied with the requirements of the following circular, rules and regulations:
a) The Bank Company Act, 1991
b) The Companies Act, 1994
c) BRPD Circular No. 14 dated 25.06.2003 and “Guidelines for Islamic Banking” issued by Bangladesh Bank
through BRPD Circular No. 15 dated 09.11.2009
d) Other circulars, rules and regulations issued by Bangladesh Bank from time to time
e) The Securities and Exchange Rules, 1987
f) The Securities and Exchange Ordinance, 1969
g) The Securities and Exchange Commission Act, 1993
h) Income Tax Ordinance, 1984
i) VAT Act, 1991
j) Standards issued by AAOIFI
k) The Stamp Act-1899
l) The Customs Act-1969
m) The Money Laundering Prevention Act, 2012
n) The Anti Terrorism (Amendment) Act, 2012 etc.

4.0 Compliance with Financial Reporting Standards as applicable in Bangladesh
The Companies/Bank complied, as per Para 12 of Securities & Exchange Rule 1987, with the following
Bangladesh Accounting Standards (BASs) and Bangladesh Financial Reporting Standards (BFRSs) as
adopted by Institute of Chartered Accountants of Bangladesh (ICAB) in preparing the financial statements of
IBBL, subject to departure described in note - 2.1, where we have followed Bangladesh Bank guidelines:
Sl. BFRS
BFRS Title Compliance Status
No. No.
1 1 First-time adoption of International Financial Reporting Standards Not Applicable
2 2 Share-based Payment Not Applicable
3 3 Business Combinations Not Applicable
4 4 Insurance Contracts Not Applicable
5 5 Non-current Assets Held for Sale and Discontinued Operations Not Applicable
6 6 Exploration for and Evaluation of Mineral Resources Not Applicable
7 7 Financial Instruments: Disclosures Complied
8 8 Operating Segments Complied
9 10 Consolidated Financial Statements Not yet effective, effective

from 1 January 2013
10 11 Joint Arrangements Do
11 12 Disclosure of Interests in other Entities Do
12 13 Fair Value Measurement Do

Sl. BAS BAS Title Compliance

No. No. Status
1 1 Presentation of Financial Statements Complied
2 2 Inventories Not Applicable
3 7 Statement of Cash Flows Complied
4 8 Accounting Policies, Changes in Accounting Estimates and Errors Complied
5 10 Events after the Reporting Period Complied
6 11 Construction Contracts Not Applicable
7 12 Income Taxes Complied
8 16 Property, Plant & Equipment Complied
9 17 Leases Complied
10 18 Revenue Complied
11 19 Employee Benefits Complied
12 20 Accounting for Government Grants and Disclosure of Government Assistance Not Applicable
13 21 The Effects of Changes in Foreign Exchange Rates Complied
14 23 Borrowing Costs Not Applicable
15 24 Related Party Disclosures Complied
16 26 Accounting and Reporting by Retirement Benefit Plans Not Applicable
17 27 Consolidated and Separate Financial Statements Complied

Sl. BAS Compliance
BAS Title
No. No. Status
18 28 Investments in Associates Not Applicable
19 31 Interest in Joint Ventures Not Applicable
20 32 Financial Instruments: Presentation Complied
21 33 Earnings per Share Complied
22 34 Interim Financial Reporting Complied
23 36 Impairment of Assets Complied
24 37 Provisions, Contingent Liabilities and Contingent Assets Complied
25 38 Intangible Assets Complied
26 39 Financial Instruments: Recognition and Measurement Complied
27 40 Investment Property Not Applicable
28 41 Agriculture Not Applicable
5.0 Audit committee

As per Bangladesh Bank BRPD circular No.12 dated 23 December 2002, the Audit Committee was formed by
the Board of Directors of the Bank consisting of the Board Members. As at 31 December 2012 the following
directors were the members of the Audit Committee:
Sl. Status with the Status with

Name of the Member Educational Qualification
No. Bank the Committee
1 Prof. NRM Borhan Uddin, Independent Chairman B.Com (Hon’s), M.Com
Ph.D. Director (Management) C.U. MBA, M.S, Ph.D
(USA)
2 Janab Md. Abdus Salam, Depositor Director Member B.Com (Hon’s), M.Com (Accounting)
FCA, FCS D.U, FCA, FCS
3 Janab Mohamad Adnan Midani Foreign Director Member Bachelor in Commerce, Graduate
Diploma in Accounting, Chartered
Accountant (Canada)
4 Janab Humayun Bokhteyar, Depositor Director Member B.Com (Hon’s), M.Com (Accounting),
ACPA, FCA ACPA, FCA

Audit Committee of the Board met in 22 occasions in the year 2012. They met in 04 occasions regarding
finalization of financial statements for the year 2012 with the Senior Management of the Bank in which among
others, the following issues were discussed:
(i) The Committee examined the financial statements of 2012 of the Bank to see whether all the
disclosures and information have been incorporated in the financial statements & whether the Bank
followed Bangladesh Financial Reporting Standards (BFRSs) and other procedures in preparing
financial statements.
(ii) In finalizing the financial statements for the year 2012, several alternatives and various pertinent
issues, such as impact of doubtful income, dividend, compensation, profit paid on deposits (PPD),
Capital Adequacy Ratio (CAR) & Risk Weighted Assets (RWA) etc. were considered by the Audit
Committee.
(iii) The Committee discussed the management letter issued by the external auditors and details
Inspection Report submitted by Bangladesh Bank, compliance status of those reports, internal check
& control systems and provided appropriate guidelines to the Management for overall improvement of
the Management and Accounting system and minimization of various types of risks.

(iv) Like previous years, the Committee also exchanged views with the statutory auditors and management
of the Bank before finalization of the financial statements of the Bank.
6.0 Related party disclosures

As per BAS 24 “Related Party Disclosures”, a related party is a person or entity that is related to the entity (i.e.
IBBL) that is preparing its financial statements. Related party transaction is a transfer of resources, services,
or obligations between a reporting entity and a related party, regardless of whether a price is charged as per
BAS 24.
Related Parties include the Bank’s Directors, key management personnel, associates, companies under
common directorship etc. as per BAS 24 “Related Party Disclosures”. All transactions involving related
parties arising in the normal course of business are conducted at arm’s length at normal commercial rates on
the same terms and conditions as third party transactions using valuation modes, as admissible.
6.1 Name of the Directors along with all related Firms/ Companies/ Institutions/Parties as at 31
December 2012:
Sl. Status with the Name of the related Firms/
Name of the Directors Remarks
No Bank Companies/Institutions/Parties etc.
1 Prof. Abu Nasser Muhammad Abduz Chairman Representative of IBN Sina
Zaher Pharmaceutical Ind. Ltd, The Ibn Sina
Trust, Manarat Trust and Fouad Abdul
Hameed Al-Khateeb Foundation.
2 Jb. Yousif Abdullah Al – Rajhi Vice – Chairman Not applicable Foreign Director
3 Engr. Mustafa Anwar Vice – Chairman Birds Garments Ltd. and
Representative of the Public Institution
for Social Security, Kuwait .
4 Jb. Mohammad Abdullah Al Jalahma Director Representative of Kuwait Awqaf Foreign Director
Public Foundation
5 Jb. Mohamad Adnan Midani Director Representative of Islamic Development Foreign Director
Bank, K S A.
6 Jb. Md. Abul Hossain Director Representative of Investment
Corporation of Bangladesh.
7 Engr. Md. Eskander Ali Khan Director KEARI Limited & Diganta Media
Corporation Limited
8 Dr. Abdulhameed Fouad Al-Khateeb Director Representative of Arabsas Travel & Foreign Director
Tourist Agency, KSA.
9 Jb. Abdullah Abdul Aziz- Al -Rajhi Director Not applicable Foreign Director
10 Jb. Salauddin Ahmed Director Representative of Kuwait Finance Foreign Director
House, Kuwait.
11 Jb. Hafizul Islam Mian Director Representative of Islamic Education
Society
12 Jb. Md. Shahidul Islam Director Not applicable
13 Jb. Mohammed Nazrul Islam Director Not applicable
14 Jb. Mominul Islam Patwary Director Not applicable
15 Prof. NRM Borhan Uddin Ph.D Independent Not applicable
Director
16 Jb. Humayun Bokhteyar, ACPA, FCA Depositor Not applicable
Director
17 Jb. Md. Abdus Salam, FCA, FCS Depositor Not applicable
Director
18 Prof. Dr. A.K.M Sadrul Islam Independent Not applicable
Director
19 Barrister Mohammed Belayet Hossain Independent Not applicable
Director
20 Jb. Mohammad Abdul Mannan Managing Not applicable Ex-Officio
Director Director

6.2 Related party transactions
a) The Bank invested to the following Firms/ Trusts/ Individuals where the Directors of the Bank are related:
Relationship Outstanding
Name of the Account/ (Million Taka)
SL. Name of the Direc- of the Director Classified
Firm/ Purpose
No. tor with the Firm/ Position
Trust etc. 2012 2011
Trust etc.
1 Fouad Al-Khateeb Prof. Abu Nasser Director HPSM (Project) Un Classified 19.89 21.1
Hospital Muhammad Abduz
Zaher (Chairman)
2 Ibn Sina Trust Prof. Abu Nasser Guarantor Purchase of - do- 461.81 516.1
Muhammad Abduz House, BMRE
Zaher (Chairman) & Import of
Machinery
3 Mrs. Shahanara Engr. Md. Eskander Husband Housing - do- 1.84 2.03
Begum Ali Khan (Director)
4 Mohammad Abdul Jb. Mohammad Abdul Himself Housing - do- 3.26 3.41
Mannan Mannan Managing
Director & Ex - Officio
Director
(b) Other related parties
SL. Nature of Closing balance

Name of the related party Nature of transaction
No. relationship 2012 2011
1 Islami Bank Capital Management Limited Subsidiary Bank balance 558,782 8,251,271
2 Islami Bank Securities Limited Subsidiary Bank balance 107,079,309 24,315,605
3 Islami Bank Securities Limited Subsidiary Mudaraba investment Nil 50,382,297
(c) As per requirement of the Bank and with the approval of Board and Bangladesh Bank, 4800 sft floor space @
Tk.80.00 per sft per month (2nd & 3rd floor) and 96 sft at ground floor @ 120.00 per sft per month for ATM Booth
have been hired with advance rent of Tk.1, 43, 42,400.00 only from wife of Janab Md. Shahidul Islam, one of the
directors of the Bank situated at 36-37, Probal Housing Ltd. Adabar, Dhaka for premises of Mohammadpur Krishi
Market Branch, Dhaka.
(d) Investment to related parties is effected as per requirement of section 27 of Bank Company Act, 1991.
(e) Share issued to Directors and Executives without consideration or exercisable at discount is Nil.
(f) Other disclosures are not applicable as required by BRPD Circular No. 14 dated 25 June, 2003 and BRPD Circular
No. 15 dated 09 November, 2009.


31.12.2012 31.12.2011
7.0 Cash in hand Taka Taka
Cash in hand (including foreign currency) (Note. 7.1) 6,308,271,684 4,655,980,193
currency) (Note. 7.2)
41,774,009,647 40,631,897,477
7.1 Cash in hand (including foreign currency)
i) In local currency 6,258,670,140 4,636,830,566
ii) In foreign currency 49,601,544 19,149,627
6,308,271,684 4,655,980,193
7.2 Balance with Bangladesh Bank & its agent bank(s) (including foreign
currency)
Balance with Bangladesh Bank (a)
In local currency 28,274,172,480 31,775,538,300
In foreign currency 5,519,323,733 2,224,285,040
33,793,496,213 33,999,823,340
Balance with Sonali Bank Ltd. (as agent of Bangladesh Bank) (b)
In local currency 1,672,241,750 1,976,093,944
In foreign currency - -
1,672,241,750 1,976,093,944
(a)+(b) 35,465,737,963 35,975,917,284
7.3 Cash Reserve Requirement (CRR) and Statutory Liquidity Ratio (SLR) have been calculated and maintained in
accordance with the Section 25 & 33 of the Bank Company Act, 1991 and subsequent BRPD Circular No. 11 & 12,
both dated August 25, 2005 & Bangladesh Bank MPD Circular No. 4 & 5 both dated 01 December 2010 and as per
Bangladesh Bank’s Letter No. BCD (P) 744 (23)/ 5 dated 03 January 1987.
CRR of the Bank was 5.00% up to 14.05.2010 as per Bangladesh Bank Letter No. BCD(P)744(23)/ 5 dated 03 January
1987, 5.50% from 15.05.2010 to 14.12.2010 as per Bangladesh Bank Letter No. MPD/116/2010-604 dated 13.05.2010
and 6.00% from 15.12.2010 as per Bangladesh Bank MPD Circular No.4 dated 01 December 2010 on total Time &
Demand Liabilities daily on bi-weekly average basis whereas CRR position should not be less than 5.50% in any day.
As per guidelines given by Bangladesh Bank, IBBL maintained CRR above requirement throughout the year.
31.12.2012 31.12.2011
7.3.1 Cash Reserve Requirement (CRR) Taka Taka
Required Reserve (6.00% of average time and demand liabilities) 23,916,835,320 19,886,266,260
Actual reserve held with Bangladesh Bank (in local currency) 28,246,172,480 31,775,538,300
Surplus / (deficit) 4,329,337,160 11,889,272,040
Maintained (%) 7.09% 9.59%
7.4 Statutory Liquidity Ratio SLR of the Bank was 10.00% up to 14.05.2010 as per Bangladesh Bank Letter No.
BCD(P)744(23)/ 5 dated 03 January 1987, 10.50% from 15.05.2010 to 14.12.2010 as per Bangladesh Bank Letter
No. MPD/116/2010-604 dated 13.05.2010 and 11.50% from 15.12.2010 as per Bangladesh Bank MPD Circular No.05
dated 01 December 2010. The Bank maintained SLR above requirement throughout the year.

31.12.2012 31.12.2011
7.4.1 Statutory Liquidity Ratio (SLR) Taka Taka
Required Reserve (11.50% of average time and demand liabilities) 45,840,601,000 38,115,344,000
Actual reserve maintained 59,715,385,914 52,290,512,437
Surplus / (deficit) 13,874,784,914 14,175,168,437
Maintained (%) 14.98% 15.78%
7.4.2 Components of Statutory Liquidity Ratio (SLR)

Cash in hand including foreign currency 6,308,271,684 4,655,980,193
Balance with Bangladesh Bank & its agent bank 29,918,414,230 33,723,632,244
Unencumbered approved securities:
Investment in shares of Bangladesh Shipping Corporation 54,700,000 110,900,000
Bangladesh Government Islamic Investment Bond 23,434,000,000 13,800,000,000
Total 59,715,385,914 52,290,512,437
7(a) Consolidated cash in hand

i) Cash in hand (including foreign currency) 6,308,274,680 4,655,996,987
Islami Bank Bangladesh Limited 6,308,271,684 4,655,980,193
Islami Bank Securities Limited 2,996 16,372
Islami Bank Capital Management Limited - 422
ii) Balance with Bangladesh Bank & its agent bank(s) (including foreign 35,465,737,963 35,975,917,284
currency)
Balance with Bangladesh Bank 33,793,496,213 33,999,823,340
Balance with Sonali Bank Ltd. (as agent of Bangladesh Bank) 1,672,241,750 1,976,093,944
Total (i+ii) 41,774,012,643 40,631,914,271
8.0 Balance with other banks & financial institutions In Bangladesh

i) In current account 616,996,187 528,689,926
ii) In Mudaraba savings & MTDR account with other islamic banks / financial 15,338,980,745 11,335,682,893
institutions
Sub total (a) 15,955,976,932 11,864,372,819
Outside Bangladesh (Note 8.1)
i) In current account 6,957,762,676 3,712,863,185
ii) In Mudaraba savings & MTDR account with other islamic banks / financial - -
institutions
iii) Balance with Offshore Banking Units (OBU) 134,608,599 73,471
Sub total (b) 7,092,371,275 3,712,936,656
Grand total (a+b) 23,048,348,207 15,577,309,475

8.1 Currency-wise amount and exchange rate of Balance with other banks & financial institutions
outside Bangladesh
Foreign currency Amount in F.C Exchange rate 2012 2011

US Dollar 69,181,628.61 79.8499 5,524,146,126 3,409,460,700
Great Britain Pound 783,979.70 129.1013 101,212,798 27,001,605
Saudi Riyal 440,340.83 21.2922 9,375,825 1,012,508
EURO 6,232,590.10 105.5695 657,971,421 191,234,926
YEN 33,297,184.00 0.9278 30,893,127 308,472
Canadian Dollar 94,156.23 80.1062 7,542,498 -
Swiss Franc 40,339.53 87.4300 3,526,885 2,399,498
Singapore Dollar 2,273,005.58 65.2368 148,283,610 36,281,130
Australian Dollar 104,005.88 82.7804 8,609,648 17,265,264
ACU Dollar 7,524,234.06 79.8499 600,809,337 27,972,553
Total 7,092,371,275 3,712,936,656
31.12.2012 31.12.2011
8.2 Maturity - wise classification Taka Taka
i) Repayable on demand 8,058,348,207 5,307,309,475

With a residual maturity of
ii) Not more than 3 months 14,800,000,000 10,080,000,000
iii) Over 3 months but not more than 1 year 190,000,000 190,000,000
iv) Over 1 year but not more than 5 years - -
v) More than 5 years - -
Total 23,048,348,207 15,577,309,475
8(a) Consolidated Balance with other banks & financial institutions

Islami Bank Securities Limited 1,117,605,602 940,640,396
Islami Bank Capital Management Limited 358n,979,268 335,346,609
24,524,933,077 16,853,296,480
9.0 Investments in shares & securities
A. Year-2012
Face value as at Value as at
No. of
Particulars 31 Dec. 2012 31 Dec. 2012 Remarks
share
(Taka) (Taka)
a) Government
i) Bangladesh Shipping Corporation 200,000 20,000,000 54,700,000 Quoted
ii) Karmasangsthan Bank 100,000 10,000,000 10,000,000 Un-Quoted
iii) Central Depository Bangladesh Ltd. 1,827,777 6,277,770 6,277,770 Un-Quoted
iv) Bangladesh Government Islamic 14 23,434,000,000 23,434,000,000 Un-Quoted
Investment Bond (Islamic Bond)
Total government (a) 2,127,791 23,470,277,770 23,504,977,770

No. of
share
(Taka) (Taka)
b) Subsidiary companies
i) Islami Bank Securities Limited 2,699,946 2,699,946,000 2,699,946,000 Un-Quoted
ii) Islami Bank Capital Management 299,993 299,993,000 299,993,000 Un-Quoted
Limited
Sub total (b) 2,999,939 2,999,939,000 2,999,939,000
c) Others
i) Bangladesh Aroma Tea Ltd.* 1,570 157,000 157,000 De-listed
ii) Investment in Financial Institutions
& Investors Portfolio Management 500,000 5,000,000 5,000,000 Un-Quoted
Co. Ltd.
iii) Mudaraba Subordinated Debt of First 1,000 500,000,000 500,000,000 Un-Quoted
Security Islami Bank Ltd.
Sub total (c ) 502,570 505,157,000 505,157,000
Sub total others (b+c) 3,502,509 3,505,096,000 3,505,096,000
Current year grand total (a+b+c) 5,630,300 26,975,373,770 27,010,073,770
*100% provision was made against probable losses in shares of Bangladesh Aroma Tea Ltd.
B. Year-2011
No. of
share
(Taka) (Taka)
a) Government
i) Bangladesh Shipping Corporation 200,000 20,000,000 110,900,000 Quoted
ii) Karmasangsthan Bank 100,000 10,000,000 10,000,000 Un-Quoted
iii) Central Depository Bangladesh Ltd. 1,827,777 6,277,770 6,277,770 Un-Quoted
iv) Bangladesh Government Islamic 9 13,800,000,000 13,800,000,000 Un-Quoted
Investment Bond (Islamic Bond)
Total government (a) 2,127,786 13,836,277,770 13,927,177,770
b) Subsidiary companies
i) Islami Bank Securities Limited 2,699,946 2,699,946,000 2,699,946,000 Un-Quoted
ii) Islami Bank Capital Management 299,993 299,993,000 299,993,000 Un-Quoted
Limited
Sub total (b) 2,999,939 2,999,939,000 2,999,939,000
c) Others
i) Bangladesh Aroma Tea Ltd.* 1,570 157,000 157,000 De-listed
ii) Investment in Financial Institutions
& Investors Portfolio Management
500,000 5,000,000 5,000,000 Un-Quoted
Co. Ltd.
Sub total (c ) 501,570 5,157,000 5,157,000
Sub total other than Govt. (b+c) 3,501,509 3,005,096,000 3,005,096,000
Current year grand total (a+b+c) 5,629,295 16,841,373,770 16,932,273,770
*100% provision was made against probable losses in shares of Bangladesh Aroma Tea Ltd.

9.1 Revaluation of shares & securities
All Shares and Securities are shown at cost price other than the Shares of Bangladesh Shipping Corporation which
have been recognized at closing market price as on 30.12.2012 of Dhaka Stock Exchange Ltd. (DSE) as per BRPD
Circular No.14 dated 25.06.2003.
31.12.2012 31.12.2011
9.2 Maturity grouping of investments in shares & securities Taka Taka
i) Repayable on demand - -
ii) Not more than 3 months 4,054,700,000 -
iii) Over 3 months but not more than 1 year 15,434,000,000 -
iv) Over 1 year but not more than 5 years 4,000,000,000 13,800,000,000
v) More than 5 years 3,521,373,770 3,132,273,770
Total 27,010,073,770 16,932,273,770
9(a) Consolidated investments in shares & securities

Islami Bank Securities Limited 1,549,929,688 1,920,847,153
Islami Bank Capital Management Limited - -
25,560,064,458 15,853,181,923
10.0 Investments 372,920,722,887 305,840,563,170
10.1 Maturity-wise classification
i) Repayable on demand - -
ii) Not more than 3 months 105,104,746,825 21,106,240,983
iii) Over 3 months but not more than 1 year 108,070,736,432 175,593,775,942
iv) Over 1 year but not more than 5 years 82,343,342,943 39,231,017,419
v) More than 5 years 77,401,896,687 69,909,528,826
Total 372,920,722,887 305,840,563,170
10.2.1 Mode - wise investment

a) In Bangladesh
i) Bai - Murabaha 213,741,402,717 175,511,513,441
ii) Bai - Muajjal 17,806,978,467 13,185,804,874
iii) Hire Purchase under Shirkatul Melk 93,495,818,382 89,070,456,408
iv) Purchase & Negotiation 7,454,201,426 7,453,764,668
v) Bai- as- Sarf (FDB)/FCD 1,823,290,744 941,880,898
vi) Musharaka Documentary Bill (MDB) 13,224,692,617 9,533,150,083
vii) Musharaka 129,062,696 37,695,176
viii) Mudaraba/ Mudaraba Documentary Bills 9,938,781,687 58,727,487
ix) Bai - Salam 4,411,145,681 3,528,065,906
x) Murabaha Foreign Currency Investment 1,983,165,751 905,120,199
xi) Quard 8,912,182,719 5,614,384,030
Sub total (a) 372,920,722,887 305,840,563,170

31.12.2012 31.12.2011
Taka Taka
b) Out side bangladesh
i) Bai - Murabaha - -
ii) Bai - Muajjal - -
iii) Hire Purchase under Shirkatul Melk - -
iv) Purchase & Negotiation - -
v) Bai- as- Sarf (FDB)/FCD - -
vi) Musharaka Documentary Bill (MDB) - -
vii) Musharaka - -
viii) Overseas Investment - -
ix) Bai - Salam - -
x) Quard - -
xi) Others - -
Sub total (b) - -
Grand total (a+b) 372,920,722,887 305,840,563,170
10.2.2 Geographical location wise classification of investments
i) Within Bangladesh
a. In rural areas 50,190,827,825 39,545,184,817
b. In urban areas 322,729,895,062 266,295,378,353
Sub total (a+b) 372,920,722,887 305,840,563,170
ii) Outside Bangladesh - -
Total (i + ii) 372,920,722,887 305,840,563,170
10.2.3 Division wise classification of investments
Name of the division
i) Dhaka division 213,608,990,006 183,456,543,045
ii) Chittagong division 81,072,965,129 61,255,402,347
iii) Khulna division 31,511,801,191 26,656,473,297
iv) Rajshahi division 28,304,682,858 12,989,780,538
v) Barisal division 3,729,207,227 2,774,654,622
vi) Sylhet division 7,160,077,877 5,867,105,666
vii) Rangpur division 7,532,998,599 12,840,603,655
Total 372,920,722,887 305,840,563,170

10.3 Investment on the basis of significant concentration including bills 31.12.2012 31.12.2011
purchased and discounted Taka Taka
a) Investment to directors 470,734,005 539,223,000

b) Investment to chief executive & other senior executives 583,464,569 520,138,000
c) Sector wise other investments:
i) Trade & commerce 105,786,724,685 97,814,685,436
ii) Real estate 21,754,895,256 16,962,546,320
iii) Transport 6,449,044,943 6,464,232,625
iv) Agriculture (including fertilizer & agriculture implements) 26,713,440,000 21,353,825,365
v) Industrial investment 189,193,421,687 150,788,448,965
vi) Others 21,968,997,742 11,397,463,459
Total 372,920,722,887 305,840,563,170
10.3.1 Classification of industrial investments (v)
i) Textile- spinning, weaving & dyeing 71,761,064,846 70,316,682,862

ii) Steel, re-rolling & engineering 21,946,436,916 7,103,203,502
iii) Agro-based industry 17,613,907,559 16,137,017,826
iv) Garments & garments accessories 13,092,184,781 10,533,257,130
v) Food & beverage 7,635,525,984 6,258,627,856
vi) Cements industry 1,854,095,533 1,965,206,224
vii) Pharmaceuticals 2,289,240,403 1,903,791,698
viii) Poultry, poultry feed & hatchery 624,338,292 934,685,749
ix) Sanitary wares 274,562,345 158,142,533
x) Chemicals, toiletries & petroleum 3,973,061,855 3,838,099,970
xi) Printing & packaging 3,329,783,018 2,729,330,343
xii) Power (electricity) 4,162,255,277 4,012,440,549
xiii) Ceramic & bricks 2,459,514,482 1,884,935,950
xiv) Health care ( hospital & others) 2,079,082,752 1,704,166,189
xv) Plastic industries 715,132,452 445,009,497
xvi) Petrol pump & CNG filling station 940,450,228 783,708,523
xvii) Information technology 549,745,695 -
xviii) Hotel & restaurant 656,329,948 537,975,366
xix) Other industries 33,236,709,321 19,542,167,198
189,193,421,687 150,788,448,965
10.3.2 Details of investment to customers group (10.00% of equity and above)

Number of clients with amount of sanctioned limit of investments exceeding 10.00% of total capital of the Bank &
classified amount thereon are given below:
Number of clients 14 13
Amount of investments 68,933,400,000 62,288,500,000
Classified amount thereon Nil Nil
Measures taken for recovery Not Applicable Not Applicable
Total capital of the Bank was Tk. 42,028.33 million as at 31 December 2012 (Tk. 33,716.73 million as on 31 December
2011).
(Taka in million)

Sl. Sanctioned Outstanding as on 31.12.2012
Name of clients 2011
No. limit Funded Non-funded Total
1 S. Alam Super Edible Oil Ltd. 13,531.00 5,968.80 485.40 6,454.20 12,247.10
2 S. Alam Refined Sugar Industry Ltd. 10,825.00 6,377.10 8.50 6,385.60 10,447.60
3 Nassa Group 9,667.20 3,410.00 2,455.70 5,865.70 2,796.40
4 Zaber & Zubair Fabrics Ltd. 7,807.20 3,988.20 3,771.50 7,759.70 5,957.50
5 Abul Khair Steels Ltd. 7,653.90 3,848.60 50.10 3,898.70 5,847.60
6 Farzana Oil Refineries and its sister concern 7,500.00 3,789.00 2,814.40 6,603.40 1,731.70
7 Mosharaf and Brothers 6,901.10 3,529.90 - 3,529.90 -
8 Sheikh Brothers 5,900.00 4,395.80 1,144.30 5,540.10 -
9 Ananda Shipyard & Slipways Ltd. 5,885.00 4,391.40 - 4,391.40 5,188.40
10 Noapara Trading 4,949.10 2,563.20 1,582.80 4,146.00 -
11 Yunus Plastic Ind. Ltd. & its Sister concern 4,777.90 2,033.00 141.10 2,174.10 3,412.10
12 Abdul Monem Sugar Refinery Ltd. 4,472.00 3,361.00 2,440.30 5,801.30 4,390.10
13 The Delta Spinning Mills Ltd. 4,350.00 2,671.90 132.70 2,804.60 -
14 Mosharaf Composite Textile Mills Ltd. 4,230.00 3,529.90 48.80 3,578.70 3,801.30
15 S. Alam Vegetable Oil Ltd. and its sister concern 8,581.40 - - - 1,956.30
16 S. Alam Cold Rolled Steel Mills Ltd and its sister 4,585.30 - - - 2,191.40
concern
17 Energyprima Ltd. 3,822.80 - - - 2,321.00
Total 53,857.80 15,075.60 68,933.40 62,288.50
Sanctioned limit of Investment clients from serial no. 15 to 17 have not been shown under the large investments this
year due to increase of Capital/ Equity of the Bank from Tk.33,716.73 million as on 31.12.2011 to Tk. 42,028.33 million
as on 31.12.2012.
31.12.2012 31.12.2011
Taka Taka
10.4 Classification status - wise investments
Unclassified :
i) Unclassified including staff investment 342,136,151,887 294,101,606,170
ii) Special mention account (SMA) 16,571,771,000 3,446,633,000
Total unclassified (i+ii) 358,707,922,887 297,548,239,170
Classified :
iii) Substandard 2,094,313,000 3,152,326,000
iv) Doubtful 1,295,180,000 802,794,000
v) Bad and Loss 10,823,307,000 4,337,204,000
Total classified (iii+iv+v) 14,212,800,000 8,292,324,000
Grand total ( i to v) 372,920,722,887 305,840,563,170
10.5 Pledged collaterals against investments

Land & building 406,212,673,667 342,497,619,606
MTDR, securities etc. 8,700,929,149 8,204,641,842
Share certificates 133,933,000 153,602,000
Total 415,047,535,816 350,855,863,448

31.12.2012 31.12.2011
Taka Taka
10.6 Particulars of investments
i) Investments considered good in respect of which the bank is fully secured 359,644,364,887 296,002,215,813
ii) Investments considered good in respect of which the Bank holds debtors’ - -
personal security
iii) Investments considered good and secured by personal security of one or 13,276,358,000 9,838,347,357
more persons in addition to personal security of debtors
iv) Investments considered bad or doubtful not provided for - -

Total 372,920,722,887 305,840,563,170
v) Investments due by directors or employees of the bank or any of them either 6,807,607,013 4,623,123,923
severally or jointly with any other persons
vi) Investments due by directors or employees of the bank are interested as 486,794,000 537,197,000
directors, partners, managing agents or in the case of private companies as
members
vii) Total amount of investments, including temporary investments, made any 6,807,607,013 4,623,123,923
time during the year to directors or employees of the bank or any of them
either severally or jointly with any other persons
viii) Total amount of investments, including temporary investments granted 486,794,000 537,197,000
during the year to the Companies or firms in which the directors of the bank
are interested as directors, partners, managing agents or, in the case of
private companies as members
ix) Investments due from other banks - -
x) Classified investments:
a) Classified investments on which compensation has not been charged 10,488,058,099 2,521,553,000
b) Provision for classified investments 6,054,350,000 3,054,000,000
c) Provision kept against investments classified as bad debts 5,480,005,979 2,419,253,000
d) Amount credited to profit/ rent /compensation suspense account 1,614,963,041 1,124,832,602
xi) Particulars of written off investments

a) Cumulative amount of investment written off since inception to 31st 4,673,131,725 4,304,438,917
December last year
b) Amount of investment written off during this year 475,804,996 368,692,808
c) Total amount written Off (a + b) 5,148,936,721 4,673,131,725
d) Amount recovered against written off investment up to this year (*) 1,239,122,544 1,131,240,213
e) Amount waived against written off investment up to this year (*) 892,321,422 816,541,212
f) Amount of investment written off against which suit has been filed to recover 5,148,936,721 4,673,131,725
the same
* During the year of 2012, Tk.76,100,209/- was waived and Tk.107,882,331/- was recovered from the clients in cash
from written off investments.
10(a) Consolidated general investments

Islami Bank Securities Limited - -
340,479,756,413 287,861,385,224

11.0 Bills purchased & discounted 31.12.2012 31.12.2011
Taka Taka
i) Payable in Bangladesh 20,678,894,043 14,777,933,406

ii) a) Payable outside Bangladesh excluding OBUs 1,823,290,744 941,880,898
b) Payable outside Bangladesh -OBUs 9,938,781,687 2,208,981,345
Total (i+ii) 32,440,966,474 17,928,795,649
11(a) Consolidated bills purchased & discounted

32,440,966,474 17,928,795,649
11.1 Maturity-wise classification of bills purchased & discounted

Payable within 1 month 6,963,105,648 1,544,448,972
Over 1 month but less than 3 months 10,360,752,341 8,558,880,734
Over 3 months but less than 6 months 9,444,682,753 3,668,091,744
6 months or more 5,672,425,732 4,157,374,199
Total 32,440,966,474 17,928,795,649
12.0 Fixed assets including premises, furniture and fixtures (Annexure-A)

Cost / revaluation
i) Land 7,516,684,798 2,448,166,198
ii) Building 6,051,400,444 3,825,850,374
iii) Construction/ capital work-in-process 75,726,010 89,553,599
iv) Furniture and fixtures 654,861,489 522,200,017
v) Mechanical appliances 2,336,557,939 1,677,728,983
vi) Motor vehicles 499,193,740 448,904,045
vii) Books 4,030,146 3,352,357
viii) Others - -
Total cost / revaluation 17,138,454,568 9,015,755,573
Less: Accumulated depreciation 2,330,226,239 1,915,563,304
Net book value at the end of the year 14,808,228,329 7,100,192,269
12.1 Revaluation of land & building
As per Bangladesh Bank BCD Circular Letter No. 12 & 18 dated April 20, 1993; June 15, 1993; BRPD Circular No.10
dated November 25, 2002; circular No. 09 dated 31 December 2008 and circular No. 24 dated 03 August 2010, the
Bank revalued its land and building by the professional valuers for the year 2000, 2002, 2003, 2004, 2005, 2006, 2009
& 2012 respectively which was reviewed by the statutory auditors.
12(a) Consolidated fixed assets including premises, furniture and fixtures

(Annexure-B)
Islami Bank Securities Limited 8,537,118 10,057,305
14,816,765,447 7,110,249,574

13.0 Other assets 31.12.2012 31.12.2011
Taka Taka
i) Stock of stationery in hand 90,992,981 81,933,430

ii) Stamps in hand 7,008,385 5,757,533
iii) Advance rent paid 468,694,508 318,468,622
iv) Security deposits paid account 14,316,664 11,889,592
v) Suspense account and advance against expenses 1,544,727,886 1,057,538,718
vi) Clearing adjustment - 3,740,390
vii) Accrued income 652,542,776 370,050,000
viii) Deferred revenue expenses 36,652 120,896
ix) IB General account (Note - 13.2) - 1,174,141,085
x) F.C. clearing adjustment 166,313,216 86,246,351
xi) Receivables from Seylon Bank PLC 30,300,809 -
Total 2,974,933,877 3,109,886,617
13.1 Classification status of other assets

i) Unclassified 2,906,316,657 3,059,435,808
ii) Doubtful 5,052,168 4,310,521
iii) Bad/ Loss 63,565,052 46,140,288
Total 2,974,933,877 3,109,886,617
13.2 IB General account

Un-reconciled entries of Inter branch transactions in Bangladesh
Age Number Amount in Taka Amount in Taka
i) Upto 3 months (*) - - 1,174,141,085
ii) Over 3 months but not more than 6 months - - -
Total (i+ii) - - 1,174,141,085
13.3 Un-reconciled entries of inter branchtransactions outside Bangladesh

Age Number Amount in Taka Amount in Taka
iii) Upto 3 months - - -
iv) Over 3 months but not more than 6 months - - -
Total (iii+iv) - - -
13(a) Consolidated other assets

Islami Bank Capital Management Limited 23,097,317 5,671,223
3,052,992,955 3,136,781,099
14.0 Deposits & other accounts 417,844,142,245 341,853,672,959
14.1 Maturity wise classification of deposits are as under
i) Re-payable on demand 6,510,898,064 5,323,422,542

ii) Re- payable within 1 month 43,464,043,635 32,276,166,386
iii) Over 1 month but within 6 months 145,012,895,226 144,240,891,174
iv) Over 6 months but not more than 1 year 58,411,852,843 50,027,025,270
v) Over 1 year but not more than 5 years 86,900,534,735 40,101,545,906
vi) Over 5 years but within 10 years 76,991,548,158 68,887,358,476
vii) Unclaimed Deposits for 10 years or more 35,533,375 42,785,782
Sub-total 417,327,306,036 340,899,195,536

31.12.2012 31.12.2011
Taka Taka
14.2 Maturity grouping of Inter- bank deposits are as under
i) Re-payable on demand - -
ii) Re- payable within 1 month 516,836,209 954,477,423
iii) Over 1 month but within 6 months - -
iv) Over 6 months but not more than 1 year - -
v) Over 1 year but not more than 5 years - -
vi) Over 5 years but within 10 years - -
Sub-total 516,836,209 954,477,423
Total (14.1+14.2) 417,844,142,245 341,853,672,959
14.3 Sector wise break up of deposits and other accounts
Government 281,845,000 286,791,000

Other banks’ deposit 516,836,209 954,477,423
Other public 632,958,000 467,209,000
Foreign currency 8,424,114,868 5,428,528,193
Private 407,988,388,168 334,716,667,343
Total 417,844,142,245 341,853,672,959
14(a) Consolidated deposits & other accounts

417,845,688,579 341,855,262,815
15.0 Other mudaraba deposits
i) Mudaraba Special Notice Deposits 5,567,121,259 5,634,330,224

ii) Mudaraba Hajj Deposits 1,242,464,874 1,043,030,009
iii) Mudaraba Savings Bond 16,519,073,679 16,830,988,729
iv) Mudaraba NRB Savings Bond 604,535,851 346,075,652
v) Mudaraba Special Savings (Pension) Deposits 73,973,554,643 65,491,911,409
vi) Mudaraba Monthly Profit Deposit Scheme 16,621,377,317 12,372,579,383
vii) Mudaraba Muhor Savings 322,778,703 271,758,892
viii) Mudaraba Waqf Cash Deposit 367,221,198 260,787,843
ix) Mudaraba School Student Savings 92,120,561 221,727
x) Mudaraba Farmers Savings A/C 212,915,387 -
xi) Mudaraba Foreign Currency Deposits 2,283,973,876 863,110,272
Total 117,807,137,348 103,114,794,140
15.1 Other banks’ deposits with IBBL
i) Al Wadeeah Current Deposits 320,114,462 218,208,634

ii) Mudaraba Special Notice Deposits 172,362,850 690,942,091
iii) Mudaraba Savings Account 24,358,897 45,326,698
Total 516,836,209 954,477,423

31.12.2012 31.12.2011
Taka Taka
16.0 Al Wadeeah current & other deposits accounts
i) Al Wadeeah Current Deposits 21,887,260,661 18,138,997,045

ii) Convertible Taka Account 151,708 151,708
iii) Non Resident Investors Taka Account 60,477,340 1,777,227
iv) Non Resident FC of Exchange House / Banks 652,743,899 604,701,479
v) Non Resident Taka Account 1,616,426,355 2,316,171,519
vi) Foreign Currency Deposit 160,345,351 332,445,892
vii) Foreign Currency Deposit ERQ 708,068,919 502,775,915
viii) Other FC Deposit 53,214,981 52,134,239
ix) Foreign Currency: Security Deposit 79,845,269 71,207,276
x) Foreign Currency Held against Back to Back L/C 3,072,592,970 2,465,309,495
xi) Foreign Currency held against Cash L/C 516,742,944 134,321,673
xii) Foreign Demand Draft /TT Payable 864,696,605 369,831,950
xiii) Foreign Currency Deposit against Foreign Bank Guarantee 31,890,054 32,690,002
xiv) Security Deposit - Investment 7,061,190 13,827,933
xv) Security Deposit - L/C (Wes) 3,568,000 6,995,889
xvi) Security Deposit - Foreign L/C General 4,368,709,141 3,615,013,346
xvii) Security Deposit - Back to Back L/C (Inland) - -
xviii) Security Deposit - Bank Guarantee 502,275,091 453,746,749
xix) Security Deposits - Foreign Bill Negotiation( FBN)/ MDB 210,422 209,422
xx) Security Deposit - IBP/ FDB/ Bai-As-Sarf 12,752,877 4,867,457
xxi) Security Deposit - Inland L/C 76,966,167 77,927,351
xxii) Profit Payable 11,111,509,935 7,432,035,127
xxiii) Remittance Card Account 3,242,947 1,571,066
xxiv) Sundry Deposits (Note-16.1) 1,739,407,111 2,028,397,972
xxv) Mobile Wallet A/C 1,790 -
Total 47,530,161,727 38,657,107,732
16.1 Break-up of sundry deposits
i) Sundry creditors 206,701,610 413,875,601

ii) Supervision charge 50,174,772 45,844,625
iii) Security deposit L/G 417,184 4,858,594
iv) Security money payable 116,329,781 87,797,259
v) Security money locker 8,521,793 5,662,560
vii) Marginal deposit 665,191,363 582,516,538
vi) Bank guarantee 1,843,035 4,437,444
viii) Excise duty 14,177,900 10,676,780
ix) Closed account profit 136,296,851 121,204,547
x) Sundry deposit others 196,354,720 455,633,207
xi) Govt.tax & VAT 64,795,126 13,888,432
xii) RDS welfare fund & RDS RIP 263,940,795 268,458,586
xiii) Karmasangsthan Bank 10,000,000 10,000,000
xiv) Other earnings (Note-16.2) 4,662,181 3,543,799
Total 1,739,407,111 2,028,397,972

31.12.2012 31.12.2011
Taka Taka
16.2 Break-up of other earnings
i) Opening balance 3,543,799 1,927,874

ii) Received from B. Bank FC clearing A/c 3,880,301 5,627,035
iii) Received from foreign correspondents/banks 1,403,840 522,398
iv) Total receipt during the year (ii+iii) 5,284,141 6,149,433
v) Less : 4,165,759 4,533,508
Income tax provision @ 42.50% 2,245,759 2,613,508
Transferred/ paid for charitable activities 1,920,000 1,920,000
vi) Closing balance (i+iv-v) 4,662,181 3,543,799
17.0 Bills payable
i) P.O. payable 2,675,110,054 1,841,425,532

ii) T.T. payable 54,728,558 41,770,783
iii) D.D. payable 803,555,182 715,105,982
iv) FC bills payable 5,181,274 5,181,274
v) BEFTN payable 219,567,306 67,736,255
vi) Spot cash payable 457,895,960 192,175,269
Total 4,216,038,334 2,863,395,095
18.0 Mudaraba Perpetual Bond 3,000,000,000 3,000,000,000
Islami Bank Bangladesh Limited issued Mudaraba Perpetual Bond (MPB) under the mudaraba principles of Islamic
Shari‘ah as per approval of Bangladesh Bank (Central Bank) as well as Securities and Exchange Commission (SEC).
The unit price of MPB is Tk.1,000/-. Credit Rating Information & Services Ltd.(CRISL) assigned A+ rating to MPB. The
Investment Corporation of Bangladesh (ICB) is the Trustee of the MPB.The MPB is listed with Dhaka Stock Exchange
Ltd. & Chittagong Stock Exchange Ltd. and trading of the same started from 25 November 2007.
19.0 Other liabilities 31.12.2012 31.12.2011

Taka Taka
i) Provision for classified & unclassified investments and off- balance sheet 11,090,700,000 8,170,000,000
iItems (Note- 19.2, 19.3 & 19.4)
ii) Provision for other assets (Note-19.5) 96,550,000 87,108,934
iii) Current tax (Note-19.6) 6,501,756,770 4,766,417,040
iv) Zakat payable 794,105,590 600,754,117
v) Dividend payable 10,617,022 10,658,477
vi) Foreign correspondents charges 2,584,977 4,338,095
vii) Incentive bonus payable 1,186,768,125 1,106,260,523
viii) Payable against expenditure 96,893,767 257,626,081
ix) Clearing adjustment 415,621 -
x) Transfer delivery adjustment 762,104 1,055,693
xi) Profit/ rent /compensation suspense account (Note - 19.7) 1,614,963,041 1,124,832,603
xii) Substitute cash assistance - -
xiii) Un-earned exchange 24,836,877 210,364,129
xiv) BEFTN adjustment 15,369,847 6,237,987
xv) Provident/SAF/Benevolent fund collection 30,215,984 251,775
xvi) IB General account (Note - 19.8) 231,894,252 -
Total 21,698,433,977 16,345,905,454

31.12.2012 31.12.2011
Taka Taka
19.1 Provision for investments including bad & doubtful investments
current year provision for investments
Unclassified investments including OBU & off-balance sheet items 4,307,754,000 4,948,313,000
Special mention account 728,596,000 167,687,000
Substandard 234,152,000 341,322,000
Doubtful 340,180,000 293,425,000
Bad and loss 5,480,018,000 2,419,253,000
11,090,700,000 8,170,000,000
19.2 Provision for classified investments
i) Provision held at the beginning of the year 3,054,000,000 1,840,000,000

ii) Fully provided investment written off/ transferred (581,925,602) (427,314,796)
iii) Recoveries of amounts previously written off 107,882,331 -
iv) Provision made during the year 3,724,020,271 1,890,656,796
v) Recoveries and provision no longer required (249,627,000) (249,342,000)
vi) Net charge to profit & loss account/(no longer required) 3,582,275,602 1,641,314,796
Total provision held at the end of the year 6,054,350,000 3,054,000,000
19.3 General provision on unclassified investment
i) Provision held at the beginning of the year 3,996,000,000 3,443,000,000

ii) Addition during the year (60,100,000) 553,000,000
iii) Balance at the end of the year 3,935,900,000 3,996,000,000
Total provision for investments including bad & doubtful investments 9,990,250,000 7,050,000,000
(Note-19.2+19.3)
19.4 General provision on off-balance sheet items

Provision held at the beginning of the year 1,120,000,000 930,000,000
Add. Provision made/ (no longer required) during the year (19,550,000) 190,000,000
Provision held as on 31st December 1,100,450,000 1,120,000,000
Total provision ( Note- 19.2+19.3+19.4) 11,090,700,000 8,170,000,000
19.5 Other provisions

Provision for other assets
Opening balance 87,108,934 87,108,934
Add: Provision made during the year 9,441,066 -
Closing balance 96,550,000 87,108,934
19.6 Current tax liability

Balance of provision on 01 January 6,519,438,311 4,528,458,836
Add: Provision made during the year (19.6.1) 6,525,837,929 5,476,469,040
Add: Other provision made during the year 79,265,181 2,613,508
Less: Settlement for previous year 4,237,371,275 3,488,103,073
Total (a) 8,887,170,146 6,519,438,311
Advance tax
Balance of advance tax on 01 January 1,753,021,271 1,195,301,698
Add: Payment made during the year 4,869,763,379 4,045,822,646
Less: Settlement for previous year 4,237,371,275 3,488,103,073
Total ( b) 2,385,413,375 1,753,021,271
Net balance as at 31 December (a-b) 6,501,756,771 4,766,417,040

31.12.2012 31.12.2011
Taka Taka
19.6.1 Provision for current tax made during the year
Income tax @ 42.50% for 2012 & 2011 on taxable profit (A) 6,604,737,555 5,515,003,546
Add: Income tax @ 20% on dividend income 365,555 560,000
Add: Excess profit tax - -
Less: Provision already kept 79,265,181 -
Estimated provision required as at 31 December (i) 6,525,837,929 5,515,563,546
Provision held
Balance at 1st January 6,519,438,311 4,528,458,836
Less: Tax for previous year 4,237,371,275 3,488,103,073
Actual provision for tax held (ii) 2,282,067,036 1,040,355,763
Estimated provision needs to be made (i-ii) 4,243,770,893 4,475,207,783
Provision actually made during the year 6,525,837,929 5,515,563,546
A. Computation of taxable profit

Profit before tax 12,096,177,670 10,347,315,330
Less: Dividend income 1,827,777 2,800,000
Profit before tax (excluding dividend income) 12,094,349,893 10,344,515,330
Add : Inadmissible expenditure 4,539,191,483 3,187,832,881
Less : Further allowable expenditure 1,092,982,423 555,869,280
Estimated taxable profit for the year (A) 15,540,558,953 12,976,478,931
Provision for tax for the year ended on 31.12.2012 has been made as per Income Tax Ordinance, 1984 applying prevailing
rates applicable on the net profit. Income tax assessment have been completed by the Deputy Commissioner of Taxes (DCT)
up to the accounting year 2010 and income tax return has been submitted for the year 2011. The Bank filed appeals/writ
petitions against tax assessment orders of different levels of tax authorities to the appropriate tax authorities and High Court
on different disputed issues. Adequate provisions for those assessment years have been made in the books of accounts.
31.12.2012 31.12.2011
Taka Taka
19.6(a) Consolidated current tax liability
6,574,464,832 5,504,252,091
19.7 Profit/ rent/ compensation suspense account

i) Balance at the beginning of the year 1,124,832,603 921,401,227
ii) Amount transferred to suspense account during the year 3,299,199,279 1,234,700,647
iii) Amount recovered from suspense account during the year (2,690,666,841) (949,793,238)
iv) Amount written-off / waived during the year (118,402,000) (81,476,033)
Balance at the end of the year 1,614,963,041 1,124,832,603
19.8 IB General account

Un-reconciled entries of inter branch transactions in bangladesh
Maturity Number Amount in Taka Amount in Taka

i) Upto 3 months (*) 3,320 231,894,252 -
ii) Over 3 months but not more than 6 months - - -
iii) More than 6 months - - -
Total (i+ii+iii) 3,320 231,894,252 -
(*) All the outstanding entries in the above mentioned IB General Account have been fully adjusted within 14.03.2013.

31.12.2012 31.12.2011
Taka Taka
19(a) Consolidated other liabilities

21,903,809,274 16,713,922,449
20.0 Deferred tax liabilities
At the beginning of the year 192,330,992 162,930,992

Add: Addition during the year 45,900,000 29,400,000
Exchange difference - -
At the end of the year 238,230,992 192,330,992
Provision for deferred tax has been made on all temporary differences between the tax base and the carrying amounts
for financial reporting purpose as per Bangladesh Accounting Standard (BAS) -12 “Income Taxes”. Tax base represents
the written down value of assets with adjustment used for tax purpose. Tax rate prevailing at the balance sheet date is
used to determine Deferred Tax.
31.12.2012 31.12.2011
Taka Taka
20(a) Consolidated deferred tax liabilities
Islami Bank Bangladesh Limited 238,230,992 192,330,992
238,628,851 192,664,063
20(b) Consolidated deferred tax income/expenses

45,964,788 29,515,743
21.0 Share capital
21.1 Authorized capital

The authorized capital of the Bank is Tk.20,000,000,000 divided into 2,000,000,000 ordinary shares of Tk.10 each.
21.2 Paid up capital

The shareholders of the bank in their 29th Annual General Meeting held on May 15, 2012 approved 25% Stock
Dividend (Bonus Share) for the year 2011, thus Paid-up Capital of the Bank was increased from Tk.10,007.71 million
to Tk.12,509.64 million during the year 2012; as detailed below:
31.12.2012
Taka
100,07,71,200 ordinary shares of Tk.10 each 10,007,712,000

25,01,92,800 Ordinary Shares of Tk.10 each issued as Bonus Share 2,501,928,000
Total 12,509,640,000

The denomination of share has been changed from Tk.100/- each to Tk.10/- each with market lot of 100 shares w.e.f.
04.12.2011 by the shareholders in its Extra Ordinary General Meeting (EGM) held on 28.10.2011 as per requirement of
Securities & Exchange Commission (SEC). As such all applicable comparatives have been re-stated considering face
value of shares at Tk.10/- each.
a) The Paid-up Capital of the Bank is Tk.1250,96,40,000 divided into 125,09,64,000 ordinary shares of Tk.10 each
fully subscribed by:
No. of Shares 31.12.2012 31.12.2011
Particulars as on % of Total Amount in Amount in
31 Dec, 2012 Taka Taka
(i) Sponsors/ promoters 744,013,342 59.48% 7,440,133,420 4,204,157,700

(ii) General public 506,934,871 40.52% 5,069,348,710 5,803,428,000
(iii) Government of the People’s 15,787 0.001% 157,870 126,300
Republic of Bangladesh**
Sub Total (a) 1,250,964,000 100.00% 12,509,640,000 10,007,712,000
** The shares have already been sold by the Government of Bangladesh but no transfer has been made in share register
of the Bank as yet.
b) Break up of share holding and percentage thereof

Holdings No. of Total Holdings/ Percentage
Shareholders No. of Shares (%)
Less than 500 Shares 34,886 5,442,691 0.43%

500 to 5,000 Shares 19,224 32,251,709 2.58%
5,001 to 10,000 Shares 2,622 18,380,355 1.47%
10,001 to 20,000 Shares 1,628 23,099,067 1.85%
20,001 to 30,000 Shares 555 13,516,483 1.08%
30,001 to 40,000 Shares 311 10,832,224 0.87%
40,001 to 50,000 Shares 173 7,811,683 0.62%
50,001 to 100,000 Shares 373 25,830,434 2.06%
100,001 to 1,000,000 Shares 445 124,941,551 9.99%
Over 1,000,000 Shares 85 988,857,803 79.05%
Total 60,302 1,250,964,000 100.00%
21.3 Capital adequacy as per Basel - II as on 31 December 2012 (Consolidated)
Bangladesh Bank through BRPD Circular No. 09 dated 31.12.2008 has instructed to all Scheduled Banks to follow
Capital Requirement rules on the basis of Risk Weighted Assets and revised Risk Based Capital Adequacy Framework
in line with Basel II simultaneously for one year i.e. parallel run for the year 2009 and full operation of Basel II was started
from January 2010 which has been duly complied by IBBL.
Subsequently, Bangladesh Bank through BRPD Circular No. 24 dated 03.08.2010 & BRPD Circular No. 35 dated
29.12.2010 issued revised Guidelines on Risk Based Capital Adequacy for Banks (Revised Regulatory Capital
Framework in line with Basel II). In accordance with Risk Based Capital Adequacy guidelines of Bangladesh Bank,
Risk Weighted Assets of the Bank has been increased due to introduction of 2 (two) new risk areas i.e. Market Risk and
Operational Risk. Details of calculation as on 31 December 2012 as per Basel II are given below:

(Amount in Crore Taka)
31.12.2012 31.12.2012 31.12.2011

(Consolidated) (Solo) (Consolidated)
A. Regulatory capital
1. Tier-1 (Core capital) (Note 21.3.1) 2,813.10 2,822.51 2,321.46
2. Tier-2 (Supplementary capital) (Note 21.3.2) 1,380.32 1,380.32 1,031.55
3. Tier-3 (Additional supplementary capital) (Note 21.3.3) - - -
4. Total regulatory capital (1+2+3) 4,193.42 4,202.83 3,353.01
B. Total Risk Weighted Assets (RWA) (Note 21.3.4) 30,988.86 31,151.16 25,543.13
C. Capital Adequacy Ratio (CAR) (as against required above 10.00% 13.53% 13.49% 13.13%
)
D. Core capital to RWA (as against required minimum 5.00%) 9.08% 9.06% 9.09%
E. Supplementary capital to RWA 4.45% 4.43% 4.04%
F. Minimum Capital Requirement (MCR) 3,098.89 3,115.12 2,554.31
G. Surplus capital (A-F) 1,094.53 1,087.71 798.70
21.3.1 Tier-1 (Core capital)
1.1 Fully paid-up capital/capital deposited with BB 1,250.96 1,250.96 1,000.77

1.2 Statutory reserve 1,242.37 1,242.37 1,000.44
1.3 Non-repayable share premium account 0.20 0.20 0.20
1.4 General reserve 13.04 13.04 15.26
1.5 Retained earnings 303.32 312.74 301.59
1.6 Non-controlling interest in subsidiaries 0.01 - -
1.7 Non-cumulative irredeemable preferences shares - - -
1.8 Dividend equalization account 3.20 3.20 3.20
1.9 Sub-total: (1.1 to 1.8) 2,813.10 2,822.51 2,321.46
Deductions from Tier-1 (Core capital)
1.10 Book value of goodwill - - -

1.11 Shortfall in provisions required against classified assets - - -
1.12 Shortfall in provisions required against investment in shares - - -
1.13 Remaining deficit on account of revaluation of investment in - - -
securities after netting off from any other surplus on the securities.
1.14 Reciprocal crossholdings of bank capital /subordinated debt - - -
1.15 Any investment exceeding the approved limit - - -
1.16 Investment in subsidiaries which are not consolidated - - -
1.17 Others, if any - - -
1.18 Sub total (1.10 to 1.17) - - -
1.19. Total eligible tier-1 capital (1.9-1.18) 2,813.10 2,822.51 2,321.46

31.12.2012 31.12.2012 31.12.2011

(Consolidated) (Solo) (Consolidated)
21.3.2 Tier-2 (Supplementary capital)
2.1 General provision (unclassified investment and off balance 503.64 503.63 511.60
sheet exposure)
2.2 Assets revaluation reserves up to 50% 574.95 574.95 215.40
2.3 Revaluation reserves of securities up to 50% 1.74 1.74 4.55
2.4 Revaluation reserves for equity instruments up to 10% - - -
2.5 All other preference shares - - -
2.6 Perpetual subordinated debt (Mudaraba Perpetual Bond) 300.00 300.00 300.00
2.7 Others (if any item approved by Bangladesh Bank) - - -
2.8 Sub-total (2.1 to 2.7) 1,380.32 1,380.32 1,031.55
2.9 Deductions, if any - - -
2.10 Total Eligible Tier-2 Capital (2.8 - 2.9) 1,380.32 1,380.32 1,031.55
21.3.3 Tier-3 (Additional supplementary capital)

3.1 Short-term subordinated debt - - -
4. Total supplementary capital (2.10+3.1) 1,380.32 1,380.32 1,031.55
5. Total regulatory capital (1.19+4) 4,193.42 4,202.83 3,353.01
21.3.4 Risk Weighted Assets (RWA) for

Amount in Crore
1. Investment (credit) risk 28,049.59 28,220.79 23,297.25
(i) On-balance sheet 24,847.12 25,018.33 20,601.11
(ii) Off-balance sheet 3,202.47 3,202.47 2,696.14
2. Market Risk 468.50 468.50 192.20
3.Operational risk 2,470.78 2,461.87 2,053.68
Total Risk Weighted Assets (1+2+3) 30,988.87 31,151.16 25,543.13

A. Investment (credit) risk on balance sheet exposures as on 31.12.2012 & 31.12.2011 ( consolidated)
RWA as on RWA as on
SL. BB’s rating Risk
Exposure type Exposure 31.12.2012 31.12.2011
No. grade * weight
(Consolidated) (Consolidated)
1 2 3 4 5 6= (4X5) 7
a) Cash and cash equivalents 0% 3,737.28 - -
Claims on Bangladesh Government and 0% 2,544.78 - -
b)
Bangladesh Bank
Claims on other sovereigns & central 0% - - -
c)
Banks
Claims on Bank for International 0% - - -
d) Settlements, International Monetary
Fund and European Central Bank
Claims on Multilateral Development - - -
Banks (MDBs)
i) IBRD , IFC, ADB, AFDB, EBRD, 0% - - -
IADB, EIB, EIF, NIB, CDB, IDB, CEDB
1 20% - - -
e)
2,3 50% - - -
ii) Other MDBs 4,5 100% - - -
6 150% - - -
Unrated 50% - - -
1 20% - -
2,3 50% - -
Claims on Public Sector Entities (other
f) 4,5 100% - - -
than government) in Bangladesh
6 150% - - -
Unrated 50% - - -
Claims on banks - -
1 20% - - -
2,3 50% 72.52 36.26 27.49
g) i) Maturity over 3 months 4,5 100% 4.77 4.77 8.04
6 150% - -
Unrated 100% 4.00 4.00 -
ii) Maturity less than 3 months 20% 2,296.72 459.34 313.86
1 20% 2,712.72 542.54 496.01
2 50% 15,144.22 7,572.11 5,985.10
h) Claims on corporates 3, 4 100% 2,765.78 2,765.78 3,574.09
5, 6 150% 19.97 29.96 23.58
Unrated 125% 2,975.45 3,719.31 4,750.28
PSE N/A - - -
Corporate N/A 7.41 9.26 19.48
Retail & N/A 19.47 14.60 30.50
NBFIs
i) Claims under Credit Risk mitigation Consumer N/A - - -
Residential N/A - - -
Property
Commercial N/A - - -
Real Estate
Sub total 32,305.10 15,157.95 15,228.42

Investment (credit) risk on balance sheet exposures as on 31.12.2012 & 31.12.2011 (Consolidated) contd…
RWA as on RWA as on
Risk
Fixed risk groups: Exposure 31.12.2012 31.12.2011
weight
j) Claims categorized as retail portfolio & small enterprise 75% 4,778.51 3,583.88 2,696.97
(excluding consumer investment)
k) Consumer finance 100% 71.06 71.06 88.96
l) Claims fully secured by residential property 50% 1,279.56 639.78 587.66
m) Claims fully secured by commercial real estate property 100% 268.15 268.15 167.50
Past due claims ( risk weights are to be assigned net of - - -
specific provision):
1.The claim (other than claims secured by eligible residential - - -
property) that is past due for more than 90 days and/or
impaired will attract risk weight as follows:
- Where specific provisions are less than 20 per cent of the 150% 1,297.86 1,946.79 285.24
outstanding amount of the past due claim ;
- Where specific provisions are not less than 20 per cent of 100% 241.79 241.79 72.38
the outstanding amount of the past due claim ;
n)
- Where specific provisions are more than 50 per cent of the 50% 334.68 167.34 122.76
outstanding amount of the past due claim.
2. Claims fully secured against residential property that are 100% 220.85 220.85 11.32
past due for more than 90 days and/or impaired specific
provision held there-against is less than 20% of outstanding
amount.
3. Loans and claims fully secured against residential property 75% 70.84 53.13 150.98
that are past due by 90 days and /or impaired and specific
provision held there-against is more than 20% of outstanding
amount
o Capital market exposures 125% 124.55 155.69 202.05
p Investments in venture capital 150% - - -
Unlisted equity Investments and regulatory capital 125% 50.01 62.52 -
q) instruments issued by other banks (other than those
deducted from capital) held in banking book
Investments in premises, plant and equipment and all other 100% 913.01 913.01 495.60
r)
fixed assets
s) Claims on all fixed assets under operating lease 100% - - -
All other assets -
i) Claims on GoB & BB (eg. Advanced income tax, 0% - - -
reimbursement of patirakkha/ shadharon shanchay patra,
etc.)
ii) Staff loan/ investment 20% 569.27 113.85 88.60
t) iii) Cash items in process of collection 20% - -
iv) Claims on Off-shore Banking Units (OBU) 100% 993.88 993.88
v) Other assets 100% 257.45 257.45 402.67
Sub total 11,471.47 9,689.18 5,372.69
Grand total 43,776.57 24,847.12 20,601.11

B. Investment (credit) risk off- balance sheet exposures as on 31.12.2012 & 31.12.2011 (Consolidated)
RWA as on RWA as on
SL. BB’s rating Risk
Exposure type Exposure 31.12.2012 31.12.2011
No. grade weight
a) Claims on Bangladesh Government and 0% - - -
Bangladesh Bank
b) Claims on other sovereigns & central banks 0% - - -
c) Claims on Bank for International Settlements, 0% - - -
International Monetary Fund and European
Central Bank
Claims on Multilateral Development Banks 0% - - -
(MDBs)
i) IBRD , IFC, ADB, AFDB, EBRD, IADB, EIB, 0% - - -
EIF, NIB, CDB, IDB, CEDB
d) ii) Other MDBs 1 20% - - -

2,3 50% - - -
4,5 100% - - -
6 150% - - -
Unrated 50% - - -
Claims on Public Sector Entities (other than 1 20% - - -
government) in Bangladesh 2,3 50% - - -
e) 4,5 100% - - -
6 150% - - -
Unrated 50% - - -
Claims on banks
i) Maturity over 3 months 1 20% 27.19 5.44 8.29
2,3 50% 98.21 49.11 58.42
f)
4,5 100% 12.34 12.34 8.07
6 150% 0.03 0.05 0.11
Unrated 100% 202.19 202.19 174.56
ii) Maturity less than 3 months 20% - - -
Claims on corporates 1 20% 50.23 10.05 45.41
2,3 50% 633.84 316.92 530.39
g) 4,5 100% 84.06 84.06 206.12
6 150% - - 0.06
Unrated 125% 1,221.86 1,527.33 1,157.71
h) Claims as retail portfolio & small enterprise 75% 1,326.66 995.00 507.01
i) (excluding consumer Investment) 100% - - -
Consumer investment
j) Claims fully secured by residential property 50% - - -
k) Claims fully secured by commercial real estate 100% - - -
l) Investment in venture capital 150% - - -
m) All other assets 100% - - -
Total 3,656.62 3,202.47 2,696.14

C. Capital requirements for: Market risk as on 31.12.2012 & 31.12.2011
Capital charge for

RWA as on RWA as on
SL. Specific General
Particulars Total 31.12.2012 31.12.2011
No. risk market risk (Consolidated) (Consolidated)
a) Profit rate risk - - - -

b) Equity position risk 0.55 0.55 1.09 10.94 22.20
c) Foreign exchange risk - 45.76 45.76 457.56 170.00
d) Commodity risk - - - - -
e) Total 0.55 46.30 46.85 468.50 192.20
D. Capital requirements for: Operational risk as on 31.12.2012 and 31.12.2011
15% of Risk Weighted

Sl. Gross Average RWA
Year Average Assets
No. Income (GI) GI 31.12.2011
GI 31.12.2012
1 2 3 4 5 6 = (5X10) 7
1 1 January 2011 to 31 December 2011 2,063.74
2 1 January 2010 to 31 December 2010 1,602.10 1,647.19 247.08 2,470.78 2,053.68
3 1 January 2009 to 31 December 2009 1,275.72
Total gross income 4,941.56
Disclosure under pillar III (market discipline) as on 31.12.2012 & 31.12.2011 as per Bangladesh Bank BRPD Circular
No. 24 dated 03.08.2010
a) Market discipline (disclosures):

A. Banking book assets
1. Cash in hand & balance with BB (excluding FC) 6,189.84 5,307.87
2. Money at call
3. Investment (HTM) 2,695.54 1,682.14
a. Government 2,343.40 1,380.00
b. Qualifying (banks, etc) - -
c. Others 352.14 302.14
4. Investment (loans & advances) (a+b) 37,124.19 30,470.17
a. Classified (SMA. SS, DF & BL to be shown separately) 3,078.46 1,173.95
Special Mention Account (SMA) 1,657.18 344.66
Sub standards 209.43 314.79
Doubtful 129.52 80.71
Bad/loss 1,082.33 433.79
b. Unclassified 34,045.73 29,296.22
5. Risk weighted assets (investment and off-balance sheet) 27,871.84 23,297.24
a. Below 100% RW 15,438.63 11,649.43
b. 100% RW 5,045.22 5,209.31
c. Above 100% RW 7,387.98 6,438.50
6. Rated status (investment and off-balance sheet)
a. Rated assets 21,624.01 19,763.46
b. Unrated assets 4,410.60 4,916.53
7. Other assets (including fixed assets) 2,164.34 898.27
A. Total banking book assets (1+2+3+4+7) 48,173.91 38,358.45

31.12.2012 31.12.2011
B. Trading book assets (Consolidated) (Consolidated)
1. FC held in hand 4.96 1.91

2. FC held in BB & Nostro account 1,247.71 593.72
3. Investment (trading) 5.47 11.09
a. Govt.(part of govt. HTM if held above the required SLR amount) 5.47 11.09
b. HFT - -
c. AFS (if any) - -
B. Total trading book assets (1+2+3) 1,258.14 606.72
Total assets (A+B) 49,432.05 38,965.17
b) Investment (credit) risk on banking book

Quantative disclosures
Particulars
A) Total exposures of credit risk
1. Funded 43,774.37 36,180.26
a) Domestic 43,390.66 35,649.44
b) Overseas 383.71 530.82
2. Non-funded 9,487.30 10,748.12
a) Domestic 6,493.75 6,549.14
b) Overseas 2,993.55 4,198.98
3. Distribution of risk exposure by claims - -
A. Claims on sovereigns and central banks 2,544.78 1,472.21
B. Claims on other official entities - -
C. Claims on banks and securities firms 2,300.72 1,569.27
D. Claims on corporate 25,233.14 21,840.27
E. Claims included in the retail portfolio & SME enterprises 4,778.51 3,595.96
F. Claims secured by residential property 1,279.56 1,175.32
G. Claims secured by commercial real estate 268.15 167.50
H. Claims against consumer investment 71.06 88.96
I. Other categories:
– Past due investment/NPI 3,078.46 1,173.95
– Off-balance sheet items 9,487.30 10,748.12
4. Credit Risk Mitigation
Claims secured by financial collateral 32.27 82.91
Net exposure after the application of haircuts. 26.88 56.26
Claims secured by eligible Guarantee - -
c) Market risk on trading Book

Particulars
Capital requirements for:
i) Profit (interest) rate risk; - -
ii) Equity position risk; 1.09 2.22
iii) Foreign exchange risk; and 45.76 17.00
iv) Commodity risk - -

31.12.2012 31.12.2011
d) Operational risk
Particulars
Capital requirements for operational risk 247.08 205.37
e) Maintenance of specific provision

Particulars
A) Gross Non Performing Assets (NPAs) 3,078.46 1,173.95
Non Performing Assets ( NPAs) to outstanding investment 8.29% 3.85%
B) Movement of Non Performing Assets ( NPAs)
1. Opening balance 621.30 705.30
2. Additions 2,457.16 468.65
3. Reductions - -
4. Closing balance 3,078.46 1,173.95
Movement of specific provisions for NPAs
1. Opening balance 184.00 184.00
2. Provisions made during the period 163.99 189.06
3. Write-off 42.73 42.73
4. Write-back of excess provisions - 24.93
5. Closing balance 305.26 305.40
f) Maintenance of regulatory capital

Particulars
A) Amount of Tier-1 Capital
i) Fully paid-up capital 1,250.96 1,000.77
ii) Statutory reserve 1,242.37 1,000.44
iii) Non-repayable share premium account 0.20 0.20
iv) General reserve 13.04 15.26
v) Retained earnings 303.32 301.59
vi) Dividend equalization account 3.20 3.20
Total Tier-I Capital 2,813.09 2,321.46
B) Amount deducted from Tier-1 Capital
i) Goodwill - -
ii) Shortfall - -
iii) Others - -
C) Total amount of Tier 2 capital (net of deductions from Tier 2

capital).
i) General provision (unclassified investment +SMA+ 503.64 511.60
Off balance sheet exposure)
ii) Assets revaluation reserves up to 50% 574.95 215.40
iii) Revaluation reserves of securities up to 50% 1.74 4.55
iv) Subordinated debt (Mudaraba Perpetual Bond) 300.00 300.00
Total Tier-II Capital 1,380.32 1,031.55
D) Total eligible capital. 4,193.42 3,353.01

31.12.2012 31.12.2011
g) Capital adequacy
Particulars
A) Amount of regulatory capital to meet unforeseen loss:
i) Amount to meet (investment) credit risk 2,804.82 2,329.73
ii) Amount to meet market risk 46.85 19.22
iii) Amount to meet operational risk. 247.08 205.37
B) Some additional capital over MCR maintained 1,094.67 798.69
2012 2011
22.0 Statutory reserve Taka Taka
Opening balance 10,004,426,808 7,934,963,742

Add: Addition made this year 2,419,235,534 2,069,463,066
Closing balance 12,423,662,342 10,004,426,808
At least 20% of net profit is transferred to statutory reserve account each year until the cumulative balance equal to
the amount of paid up capital account as per Section 24 of the Bank Company Act 1991.
23.0 Others reserves 31.12.2012 31.12.2011

a) General reserve
Opening balance 152,645,772 583,130,387
Add: Addition/(adjustment) made this year (22,205,793) (430,484,615)
Sub total (i) 130,439,979 152,645,772
b) Share premium 1,989,633 1,989,633

c) Assets revaluation reserve (Note 23.1) 11,498,971,320 4,308,071,320
d) Dividend equalization account 32,000,000 32,000,000
e) Revaluation reserve of securities (Note 23.2) 34,700,000 90,900,000
Sub total (ii) 11,567,660,953 4,432,960,953
f) Translation reserve
Opening balance - -
Add: Addition/ (adjustment) made this year (3,303,771) -
Sub total (iii) (3,303,771) -
Grand total (i + ii+iii) 11,694,797,161 4,585,606,725
23.1 Assets revaluation reserve
Opening balance 4,308,071,320 4,313,460,000

Addition during the year 7,190,900,000 -
Adjustment during the year - (5,388,680)
Closing balance 11,498,971,320 4,308,071,320

31.12.2012 31.12.2011
23.2 Revaluation reserve of securities
Opening balance 90,900,000 621,000,000

Adjustment during the year (56,200,000) (530,100,000)
Revaluation made during the year - -
Closing balance 34,700,000 90,900,000
24.0 Letter of guarantee 2012 2011

Taka Taka
(a) Claim against the bank which is not acknowledged as debt - -
(b) Money for which the bank is contingently liable in respect
of guarantees issued favouring :
i) Directors - -
ii) Government 765,910,552 568,167,638
iii) Bank and other financial institutions 453,724 38,536,812
iv) Others 6,531,121,274 6,695,538,015
Total 7,297,485,550 7,302,242,465
24.1 Security pledged against Mudaraba Perpetual Bond (MPB) liabilities of 4,489,100,000 4,489,100,000
Tk. 3,000 Million:
25.0 Investment income

Income from general investment
Bai Murabaha 25,625,826,162 18,634,820,811
Musharaka /Musharaka Documentary Bills 1,650,848,673 1,608,584,495
Bai Muajjal 2,342,455,272 1,638,051,953
Hire Purchase under Shirkatul Melk 11,000,357,892 8,562,558,621
Bai Salam 360,052,627 222,309,941
Mudaraba - (284,569,341)
Mudaraba : Profit on Islamic Inter-Bank Fund Market (IIFM) 18,564,179 -
Bai -As- Sarf (FDB /FCD), IBP, MFCI and UPAS 161,405,959 181,133,837
Investment income: Off-shore Banking Unit (OBU) 144,514,613 29,328,468
Others (Compensation Realisable/ Realised) 422,217,534 642,928,187
Sub Total (i) 41,726,242,911 31,235,146,972
Profit on deposits with other banks & financial institutions

a) In Bangladesh 1,945,983,070 784,385,472
b) Outside Bangladesh - -
Sub total (ii) 1,945,983,070 784,385,472
Grand total (i + ii) 43,672,225,981 32,019,532,444

31.12.2012 31.12.2011
25.1 Investment income derived from the fund deployed by
i) Mudaraba deposits 37,216,308,026 27,241,499,763

ii) Other deposits/fund 6,033,700,421 4,464,150,000
Total 43,250,008,447 31,705,649,763
26.0 Profit Paid on Mudaraba Deposits
i) Profit paid on Mudaraba Savings Deposit 7,120,587,950 5,524,806,727

ii) Profit paid on Mudaraba Term Deposit Account 7,805,821,402 4,593,371,538
iii) Profit paid on other Mudaraba Deposits 10,536,615,885 7,887,039,820
iv) Profit paid on Placement - -
v) Profit paid on Mudaraba Perpetual Bond (MPB) 407,400,000 396,000,000
Total 25,870,425,237 18,401,218,085
The mudaraba depositors are entitled to get minimum 65% of investment income earned through deployment
of mudaraba fund as per weightages. In 2012, 70.04% (2011: 68.60%) of profit earned through deployment of
mudaraba fund has been distributed/provided to the mudaraba depositors & MPB holders. It may be mentioned here
that in some mudaraba deposits, additional rate was allowed over the rate arrived as per weightage. An additional
amount equivalent to 10.00% of the rate of dividend has been provided for MPB holders of the Bank for the year
2012 (2011: 10.00%).
27.0 Income from investments in shares & securities 31.12.2012 31.12.2011
i. Inside Bangladesh
Bangladesh Government Islamic Investment Bond (BGIIB) 430,142,971 286,570,090

Bangladesh Shipping Corporation (BSC) - 2,000,000
Central Depository Bangladesh Ltd. (CDBL) 1,827,777 800,000
Sub total (i) 431,970,748 289,370,090
ii. Outside Bangladesh - -

Sub total (ii) - -
Grand total (i+ii) 431,970,748 289,370,090
27(a) Consolidated income from investments in shares & securities

484,361,836 331,004,637

28.0 Commission, exchange & brokerage income 2012 2011
Taka Taka
i) Commission income 2,881,472,975 2,720,250,757

ii) Exchange income (Note 28.1) 2,368,227,006 2,563,851,742
iii) Brokerage income - -
Total 5,249,699,981 5,284,102,499
28.1 Exchange income
Gross exchange gain 2,368,227,006 2,563,851,742

Less: exchange loss - -
Net exchange gain 2,368,227,006 2,563,851,742
28(a) Consolidated commission, exchange & brokerage income

5,260,647,661 5,297,455,786
29.0 Other operating income
i) Rent on locker 8,487,036 7,297,482

ii) Telephone/ trunk call charge recovered 6,196,861 13,503,912
iii) P&T charge recovered 56,287,453 56,166,715
iv) Legal expenses recovered 8,560,772 3,695,063
v) E & TA fees recovered 918,097 762,713
vi) Income from ATM & SWIFT 196,520,743 129,976,766
vii) Account maintenance charges realised 497,006,788 433,909,216
viii) Service charges recovered 27,595,345 21,476,427
ix) Service charges recovered: OBU 1,733,870 147,319
x) Rent on premises realised 2,932,580 2,705,587
xi) Sale proceeds of tender schedule 1,152,000 658,500
xii) Profit on sale of bank’s car 8,468,394 1,686,695
xiii) Written-off investment recovery 107,882,331 77,081,305
xiv) Recruitment fees recovered 22,544,564 38,805
xv) MICR cheque charge realised 4,114,960 2,703,433
xvi) Others 41,471,337 56,481,972
Total 991,873,131 808,291,910
29(a) Consolidated other operating income

1,122,169,884 876,633,643

2012 2011
Taka Taka
30.0 Rent, taxes, insurances, electricity etc.
i) Rent, rates and taxes 221,603,303 181,463,859

ii) Insurance 227,345,201 196,414,855
iii) Electricity and lighting 203,546,262 125,759,209
Total 652,494,766 503,637,923
30(a) Consolidated rent, taxes, insurances, electricity etc.

Islami Bank Capital Management Limited 599,718 613,473
655,576,460 507,063,897
31.0 Postage, stamps, telecommunications etc.
i) Postage 45,713,904 38,947,737

ii) SWIFT charges 24,470,465 18,228,691
iii) Telephone 32,160,956 28,553,702
iv) Fax & internet 9,072,328 8,431,070
v) Stamps charges - -
Total 111,417,653 94,161,200
31(a) Consolidated postage, stamps, telecommunications etc.

111,528,843 94,267,115
32.0 Stationery, printing and advertisement etc.
i) Paper & table stationery 23,462,435 20,190,385

ii) Printing and stationery (registers and forms) 126,863,357 100,246,876
iii) Advertisement & publicity 117,222,030 77,681,891
Total 267,547,822 198,119,152
32(a) Consolidated stationery, printing and advertisement etc.

267,730,060 198,418,476

2012 2011
Taka Taka
33.0 Directors’ fees and expenses
i) Directors’ fees for attending board/ executive committee/ other committees 4,054,653 3,823,202
meeting
ii) TA/DA/hotel fare for local & foreign directors 5,437,108 4,297,934
iii) Others 575,079 1,133,850
Total 10,066,840 9,254,986
33.1 Rate of fees for attending board/ executive committee/ other

committees meeting
i) For board meeting 5,000 5,000

ii) For executive committee/ other committees meeting 4,000 4,000
33(a) Consolidated directors’ fees and expenses

Islami Bank Securities Limited - 276,000
10,066,840 9,530,986
34.0 Shari‘ah supervisory committee’s fees & expenses
i) Shari‘ah supervisory members’ fees for attending meeting 613,000 873,000

ii) TA/DA./hotel fare 1,736,894 1,676,142
iii) Others 234,935 200,141
Total 2,584,829 2,749,283
34.1 Rate of fees for attending shariah supervisory meeting
i) For shariah supervisory meeting 5,000 5,000

ii) For sub-committee meeting 4,000 4,000
35.0 Depreciation and repair to bank’s assets
i) Depreciation: Premises (building) 83,575,987 82,775,792

ii) Depreciation: Furniture & fixtures and other fixed assets 358,744,320 285,730,929
Sub total (i+ii) 442,320,307 368,506,721
iii) Repair of bank’s properties/assets 57,908,661 38,551,203
Grand total (i+ii+iii) 500,228,968 407,057,924
35(a) Consolidated depreciation and repair to bank’s assets

504,441,086 409,590,979

2012 2011
Taka Taka
36.0 Other expenses
i) TA/ DA 120,908,726 91,441,801

ii) Repairs to rented premises 7,723,198 2,673,408
iii) Motor car running & maintenance 59,160,857 57,089,362
iv) Periodicals & newspapers 7,159,809 5,305,031
v) Entertainment 121,131,737 100,480,640
vi) Overtime 37,719,553 26,934,811
vii) Training expenses 42,857,896 35,992,212
viii) Meeting expenses 21,014,598 18,200,706
ix) Bank charges 32,319,098 22,822,548
x) Uniforms 9,590,920 8,783,230
xi) Conveyance 9,797,586 8,297,826
xii) Honorarium & cash award 24,099,641 12,620,042
xiii) Membership fees 5,356,400 8,265,327
xiv) Staff welfare 12,963,907 10,987,589
xv) Evening banking allowance 2,493,817 2,320,335
xvi) Computer expenses 29,113,672 23,290,845
xvii) Wages 39,201,952 37,257,969
xviii) Discomfort allowance 11,128,028 9,600,059
xix) Air condition maintenance 1,630,558 998,910
xx) WASA / gas expenses 8,821,234 7,317,312
xxi) Washing charges 9,082,553 7,062,985
xxii) Transportation charges 2,930,126 1,445,384
xxiii) ATM charges 58,009,434 14,511,135
xxiv) Reuters charges 6,644,453 6,132,552
xxv) Business development expenses 148,542,267 464,907,850
xxvi) Photocopy expenses 15,187,129 11,590,079
xxvii) Upkeep of office premises 14,637,605 10,452,001
xxviii) Clearing house expenses 418,752 522,358
xxix) Bonus share issue expenses 6,013,176 5,712,366
xxx) Rating expenses 460,000 397,000
xxxi) Band width charges 76,884,762 51,089,823
xxxii) Other regulatory fees and expenses 8,006,697 5,038,735
xxxiii) MPB expenses 1,971,366 980,715
xxxiv) Recruitment expenses 5,699,488 8,855,855
xxxv) Others 17,499,081 17,885,154
xxxvi) Loss on sale of bank’s fixed asset 199,828 281,429
xxxvii) Khidmah card expenses 3,175,755 230,909
xxxviii) Other RDS expenses 46,296,593 23,664,554
Total 1,025,852,252 1,121,440,847
36.1 Motor car running and maintenance

As on 31.12.2012 the Bank had 253 (Two hundred fifty three) Motor Vehicles (Cars -205, Jeeps -11, Pickup-35 and
Microbuses -2) . The Motor Vehicles are used for carrying cash, development works and for other important works
of the bank. Some vehicles are attached with the senior executives of the bank as per transport policy of the bank.
A sum of Tk.60,858,475/- was incurred during the year ended on 31.12.2012 as against Tk.58,837,857/- incurred
during the year 2011 for repairs, maintenance, purchase of fuel & lubricants and insurance etc. for the motor
vehicles of the bank.

36.2 VAT related to expenditures
All the expenditures reported in this Financial Statements are inclusive of VAT except for specific items which are
exempted from VAT by appropriate authority
2012 2011
Taka Taka
36(a) Consolidated other expenses
Islami Bank Capital Management Limited 8,595 20,575
1,029,710,622 1,128,991,237
37.0 Retained earnings: movement of surplus in profit & loss account

Retained earnings as on 1 January 3,202,467,840 2,594,592,000
Addition during the year 3,127,410,000 3,202,467,840
Total 6,329,877,840 5,797,059,840
Less: Amount transferred to Paid-up Capital (bonus share) & cash dividend (3,202,467,840) (2,594,592,000)
Balance of retained earnings as at 31 December 3,127,410,000 3,202,467,840
37(a) Consolidated retained earnings

Retained earnings as on 1 January 3,015,952,005 2,624,924,708
Add: Net profit attributable to equity holders of IBBL 5,616,751,549 4,624,597,748
Sub-total 8,632,703,554 7,249,522,456
Less:
Transfer to/(from) statutory reserve 2,419,235,534 2,069,463,066
Transfer to/(from) general reserve (22,205,793) (430,484,615)
Dividend paid (Bonus share & cash dividend) 3,202,467,840 2,594,592,000
Sub-total 5,599,497,581 4,233,570,451
Balance of retained earnings as at 31 December 3,033,205,973 3,015,952,005
37(b) Non-controlling interest As on Share of profit or

01.01.2012 loss for the year
Islami Bank Securities Limited 49,758 1,332 51,090 49,758

Islami Bank Capital 7,597 600 8,197 7,597
Management Limited
57,355 1,932 59,287 57,355
The share capital of Islami Bank Securities Ltd. is Tk.2700,000,000/- divided into 2,700,000 shares of Tk.1,000/
each out of which share capital of minority is Tk.54,000/- divided into 54 shares of Tk.1,000/- each which represent
0.0020% of total share of the subsidiary Company.
The share capital of Islami Bank Capital Management Ltd. is Tk.300,000,000/- divided into 300,000 shares of
Tk.1,000/ each out of which share capital of minority is Tk.7,000/- divided into 7 shares of Tk.1,000/- each which
represent 0.0023% of total share of the subsidiary Company.
38.0 Events after reporting period

The Board of Directors of the Bank in its 201st meeting held on March 28, 2013 recommended 17% Stock Dividend
and 8% Cash Dividend for the year 2012 subject to approval of the shareholders in the ensuing 30th Annual General
Meeting to be held on May 22, 2013.
39.0 Earnings per share (EPS)

a) Attributable profit for the year 5,524,439,741 4,841,446,291
b) Weighted average number of ordinary share during the year 1,250,964,000 1,250,964,000
Basic earnings per share (EPS) (a ÷ b) 4.42 3.87

Previous year’s figures have been adjusted due to issuance of 250,192,800 bonus shares during the year 2012 against
25% Stock Dividend of 2011 as per guidelines of BAS 33, “Earnings per share”. Diluted earnings per share is not applicable
since there is no possibility of dilution of shares during the year.

2012 2011
Taka Taka
39(a) Consolidated earnings per share

Consolidated profit after tax 5,616,753,481 4,624,593,651
Less: Profit attributable to non-controlling interest 1,932 (3,650)
Attributable profit for distribution to shareholders of IBBL 5,616,751,549 4,624,597,301
Weighted average number of ordinary share during the year 1,250,964,000 1,250,964,000
Consolidated basic earnings per share 4.49 3.70
40.0 Net asset value per share (NAV)

a) Capital/shareholders’ equity for the year 39,755,509,503 27,800,213,373
Net asset value per share (NAV) (a ÷ b) 31.78 22.22
Net asset value per share (NAV) has been disclosed as per the Securities and Exchange Commission’s Notification
No.SEC/CMRRCD/2009-193/Admin/03-31 dvvated June 1, 2009. Previous year’s number of ordinary shares has
been adjusted to conform current year’s presentation due to issuance of 250,192,800 bonus shares during the year
2012 against stock dividend of 2011.
41.0 Net operating cash flow per share (NOCFPS)

a) Net cash flows from operating activities 20,410,650,708 16,395,120,620
Net operating cash flow per share (NOCFPS) (a ÷ b) 16.32 13.11

Net operating cash flow per share (NOCFPS) has been disclosed as per the Securities and Exchange Commission’s
Notification No.SEC/CMRRCD/2009-193/Admin/03-31 dated June 1, 2009. Previous year’s number of ordinary shares
has been adjusted to conform current year’s presentation due to issuance of 250,192,800 bonus shares during the
year 2012 against stock dividend of 2011.
42.0 Reconciliation of cash and cash equivalent at the end of the year
i) Cash in hand 6,308,271,684 4,655,980,193

ii) Balance with Bangladesh Bank and its agent banks (Sonali Bank Ltd.) 35,465,737,963 35,975,917,284
iii) Balance with other banks and financial institutions 23,048,348,207 15,577,309,475
Total 64,822,357,854 56,209,206,952
42(a) Consolidated cash and cash equivalents

Islami Bank Securities Limited 1,117,608,598 940,656,768
66,298,945,720 57,485,210,751
43 Operating lease payments disclosure

Non-cancellable operating lease rentals for the Bank are payable as follows: 2012 2011
Taka (in million) Taka (in million)
Less than 1 year 300 220

Between 1 and 5 years 2,175 2,095
More than 5 years 7,530 7,450
10,005 9,765
44.0 Currency wise exposures
Currency wise exposures are shown at Annexure-C.
Director Director

Dated: Dhaka
28 march 2013
Fixed Assets Schedule
As on 31 December 2012
Annexure - A
(Amount in Taka)

Cost Depreciation Written down value
Sale /
Particulars Addition Charged Adjustment
Balance as at adjustment Total as at Charged upto Total as at as at as at
during the during the during the
01.01.2012 during the 31.12.2012 01.01.2012 31.12.2012 31.12.2012 31.12.2011
year year year
year
1 2 3 4 5 (2 + 3 - 4) 6 7 8 9 (6+ 7 - 8) 10 (5 - 9) 11
A. Premises
Land 2,558,584,798 - - 2,558,584,798 - - - - 2,558,584,798 2,558,584,798
Building 3,715,431,774 103,168,670 - 3,818,600,444 451,207,960 83,575,987 - 534,783,947 3,283,816,497 3,264,223,814
Construction/capital 89,553,599 36,235,412 50,063,001 75,726,010 - - - - 75,726,010 89,553,599
work in process
Sub total (A) 6,363,570,171 139,404,082 50,063,001 6,452,911,252 451,207,960 83,575,987 - 534,783,947 5,918,127,307 5,912,362,211
B. Revaluation
Land - 4,958,100,000 - 4,958,100,000 - - - - 4,958,100,000 -
Building - 2,232,800,000 - 2,232,800,000 - - - - 2,232,800,000 -
Sub total (B) - 7,190,900,000 - 7,190,900,000 - - - - 7,190,900,000 -
Sub total (A+B) 6,363,570,171 7,330,304,082 50,063,001 13,643,811,252 451,207,960 83,575,987 - 534,783,947 13,109,027,307 5,912,362,211
C. Other fixed assets
Furniture and fixtures 522,200,017 133,493,417 831,945 654,861,489 207,975,593 39,734,015 11,400 247,698,208 407,163,281 314,224,424
Mechanical appliances 1,677,728,983 669,077,267 10,248,311 2,336,557,939 968,936,458 257,022,469 6,720,814 1,219,238,113 1,117,319,826 708,792,525
Motor vehicles 448,904,045 75,162,516 24,872,821 499,193,740 284,992,704 61,610,673 20,967,189 325,636,188 173,557,552 163,957,019
Books 3,352,357 677,789 - 4,030,146 2,496,268 377,163 3,648 2,869,783 1,160,363 856,090
Sub Total (C) 2,652,185,402 878,410,989 35,953,077 3,494,643,314 1,464,401,023 358,744,320 27,703,051 1,795,442,292 1,699,201,022 1,187,830,058
Total (A+B+ C) 9,015,755,573 8,208,715,071 86,016,078 17,138,454,566 1,915,608,983 442,320,307 27,703,051 2,330,226,239 14,808,228,329 7,100,192,269
Dated: Dhaka
28 march 2013
Consolidated Fixed Assets Schedule
As on 31 December 2012
Annexure - B
(Amount in Taka)
Cost Depreciation Written down value

Sale /
Particulars Addition Charged Adjustment
Balance as at adjustment Total as at Charged upto Total as at as at as at
during the during the during the
01.01.2012 during the 31.12.2012 01.01.2012 31.12.2012 31.12.2012 31.12.2011
year year year
year
1 2 3 4 5 (2 + 3 - 4) 6 7 8 9 (6+ 7 - 8) 10 (5 - 9) 11
A. Premises
Land 2,558,584,798 - - 2,558,584,798 - - - - 2,558,584,798 2,558,584,798
Building 3,715,431,774 103,168,670 - 3,818,600,444 451,207,960 83,575,987 - 534,783,947 3,283,816,497 3,264,223,814
Construction/capital 89,553,599 36,235,412 50,063,001 75,726,010 - - - - 75,726,010 89,553,599
work in process
Sub total (A) 6,363,570,171 139,404,082 50,063,001 6,452,911,252 451,207,960 83,575,987 - 534,783,947 5,918,127,307 5,912,362,211
B. Revaluation
Land - 4,958,100,000 - 4,958,100,000 - - - - 4,958,100,000 -
Building - 2,232,800,000 - 2,232,800,000 - - - - 2,232,800,000 -
Sub total (B) - 7,190,900,000 - 7,190,900,000 - - - - 7,190,900,000 -
Sub total (A+B) 6,363,570,171 7,330,304,082 50,063,001 13,643,811,252 451,207,960 83,575,987 - 534,783,947 13,109,027,307 5,912,362,211
C. Other fixed assets
Furniture and fixtures 524,302,247 133,548,417 831,945 657,018,719 208,286,287 39,988,885 11,400 248,263,772 408,754,947 316,015,960
Mechanical appliances 1,682,834,298 670,087,971 10,248,311 2,342,673,958 969,974,271 258,395,989 6,720,814 1,221,649,446 1,121,024,512 712,860,027
Motor vehicles 454,380,045 75,302,516 24,872,821 504,809,740 286,270,437 62,708,174 20,967,189 328,011,422 176,798,318 168,155,286
Books 3,352,357 677,789 - 4,030,146 2,496,268 377,163 3,648 2,869,783 1,160,363 856,090
Sub Total (C) 2,664,868,947 879,616,693 35,953,077 3,508,532,563 1,467,027,263 361,470,211 27,703,051 1,800,794,423 1,707,738,140 1,197,887,363
Total (A+B+ C) 9,028,439,118 8,209,920,775 86,016,078 17,152,343,815 1,918,235,223 445,046,198 27,703,051 2,335,578,370 14,816,765,447 7,110,249,574
Annual Report 2012

Dated: Dhaka
28 march 2013
269
Currency wise Exposures
Annexure - C
(Amount in Taka)

Equivalent Taka of Other
Taka Equivalent Taka of US Dollar Equivalent Taka of GBP Equivalent Taka of EURO Total Taka
ASSETS Currency
2012 2011 2012 2011 2012 2011 2012 2011 2012 2011 2012 2011
1 2 3 4 5 6 7 8 9 10 11 12 13
Cash in hand 6,258,670,140 4,636,830,566 48,820,755 17,470,523 433,780 431,863 120,271 872,694 226,738 374,547 6,308,271,684 4,655,980,193
Balance with Bangladesh Bank & its 29,946,414,230 33,751,632,244 5,460,770,198 2,181,429,684 27,365,677 25,083,350 30,908,698 17,456,067 279,160 315,939 35,465,737,963 35,975,917,284
agent bank
Balance with banks & other financial 15,955,976,932 11,864,372,819 5,524,146,126 3,409,460,700 101,212,798 27,001,605 657,971,421 191,234,926 809,040,930 85,239,425 23,048,348,207 15,577,309,475
institutions
Placement with other banks & financial - - - - - - - - - - - -
institutions
Investments (in shares & securities) 27,010,073,770 16,932,273,770 - - - - - - - - 27,010,073,770 16,932,273,770
Investments 372,920,722,887 305,840,563,170 - - - - - - - - 372,920,722,887 305,840,563,170
Fixed assets including premises 14,808,228,329 7,100,192,269 - - - - - - - - 14,808,228,329 7,100,192,269
Other assets 2,808,620,661 3,109,886,617 165,538,395 - 5,570 - 769,251 - - - 2,974,933,877 3,109,886,617

Non banking assets - - - - - - - - - - - -
Total assets 469,708,706,949 383,235,751,455 11,199,275,474 5,608,360,907 129,017,825 52,516,818 689,769,641 209,563,687 809,546,828 85,929,911 482,536,316,717 389,192,122,778
Equivalent Taka of Other

Taka Equivalent Taka of US Dollar Equivalent Taka of GBP Equivalent Taka of EURO Total Taka
LIABILITIES Currency
2012 2011 2012 2011 2012 2011 2012 2011 2012 2011 2012 2011
Placement from Bangladesh Bank, other - - - - - - - - - - - -
banks, financial institutions and agents
Deposits 405,940,238,836 333,532,419,074 7,199,194,036 5,047,106,191 16,100,832 23,659,114 472,275,043 386,781,740 295,164 311,745 413,628,103,911 338,990,277,864
Bills payable 4,216,038,334 2,863,395,095 - - - - - - - - 4,216,038,334 2,863,395,095
Other liabilities 21,936,664,969 16,538,236,446 - - - - - - - - 21,936,664,969 16,538,236,446
Mudaraba Perpetual Bond 3,000,000,000 3,000,000,000 - - - - - - - - 3,000,000,000 3,000,000,000
Total liabilities 435,092,942,139 355,934,050,615 7,199,194,036 5,047,106,191 16,100,832 23,659,114 472,275,043 386,781,740 295,164 311,745 442,780,807,214 361,391,909,405
Net position 34,615,764,810 27,301,700,840 4,000,081,438 561,254,716 112,916,993 28,857,704 217,494,598 (177,218,053) 809,251,664 85,618,166 39,755,509,503 27,800,213,373
Dated: Dhaka
28 march 2013
Consolidated segment reporting
Annexure - D
(Amount in Taka)
Head Office
Dhaka Central Dhaka South Dhaka North Chittagong Chittagong
Particulars Controlled Khulna Zone Bogra Zone Rajshahi Zone Common Consolidated
Zone Zone Zone South Zone North Zone
Branchs
Investment income 9,283,932,357 7,856,012,563 2,879,971,452 3,140,521,245 2,597,979,254 1,338,832,654 3,072,583,652 4,609,058,124 1,994,881,235 7,382,815,281 44,156,587,817
Profit paid on mudaraba deposits (1,893,268,025) (2,389,111,412) (1,856,490,732) (2,725,304,509) (1,652,908,339) (925,194,197) (1,230,214,388) (2,310,206,370) (1,624,822,431) (9,262,904,834) (25,870,425,237)
Profit received/(paid) on IB (4,649,734,652) (2,755,481,245) 515,792,654 1,761,812,365 223,901,254 204,807,521 (664,583,652) (311,062,563) 652,861,452 5,021,686,866 -
Genearl Account
Net investment income 2,740,929,680 2,711,419,906 1,539,273,374 2,177,029,101 1,168,972,169 618,445,978 1,177,785,612 1,987,789,191 1,022,920,256 3,141,597,313 18,286,162,580
Commission, exchange & other 1,174,234,652 642,062,541 285,353,652 338,744,236 290,143,698 102,264,532 203,724,563 321,313,698 299,833,652 2,725,142,321 6,382,817,545
income
Total operating income 3,915,164,332 3,353,482,447 1,824,627,026 2,515,773,337 1,459,115,867 720,710,510 1,381,510,175 2,309,102,889 1,322,753,908 5,866,739,634 24,668,980,125
Total operating expenses (479,508,944) (563,226,805) (573,209,139) (587,812,430) (591,067,511) (370,342,374) (431,139,115) (400,847,701) (368,721,722) (4,522,884,945) (8,888,760,686)
Operating Profit 3,435,655,388 2,790,255,642 1,251,417,887 1,927,960,907 868,048,356 350,368,136 950,371,060 1,908,255,188 954,032,186 1,343,854,689 15,780,219,439
There are 16 operating segments including subsidiaries as on 31 December 2012. Out of which only 9 are reportable as per BFRS 8 “Operating segments”. Hence other non-reportable
segments have been shown as under ‘Common’.
Head Office
Dhaka Central Dhaka South Dhaka North Chittagong Chittagong
Particulars Controlled Khulna Zone Bogra Zone Rajshahi Zone Common Consolidated
Zone Zone Zone South Zone North Zone
Branchs
Investment income - 12,103,914,562 2,672,941,236 2,989,793,652 1,571,532,587 1,319,294,685 2,163,094,563 2,865,284,521 1,958,993,652 4,705,687,623 32,350,537,081
Profit paid on mudaraba deposits - (1,913,433,652) (1,840,553,652) (2,106,874,587) (1,114,463,652) (978,351,452) (982,516,532) (1,685,853,651) (1,052,851,258) (6,726,319,649) (18,401,218,085)
Profit received/(paid) on IB - (6,572,551,254) 799,553,654 1,302,883,654 301,561,257 399,973,657 (209,113,654) 278,193,654 112,483,697 3,587,015,335 -
Genearl Account
Net investment income - 3,617,929,656 1,631,941,238 2,185,802,719 758,630,192 740,916,890 971,464,377 1,457,624,524 1,018,626,091 1,566,383,309 13,949,318,996
Commission, exchange & other - 1,451,884,563 440,439,785 366,123,681 265,992,461 132,792,584 189,114,561 363,374,587 185,392,546 2,778,974,661 6,174,089,429
income
Total operating income - 5,069,814,219 2,072,381,023 2,551,926,400 1,024,622,653 873,709,474 1,160,578,938 1,820,999,111 1,204,018,637 4,345,357,970 20,123,408,425
Total operating expenses - (511,765,104) (472,862,508) (439,605,778) (377,631,932) (389,588,337) (325,904,906) (267,305,104) (244,765,106) (4,262,226,340) (7,291,655,115)
Operating Profit - 4,558,049,115 1,599,518,515 2,112,320,622 646,990,721 484,121,137 834,674,032 1,553,694,007 959,253,531 83,131,630 12,831,753,310
B. Segmental assets and liabilities
The necessary information regarding assets and liabilities of operating segments (except subsidiaries) are not separable and individually identifiable for this purpose. For this reason the assets
and liabilities of the respective segments have not been presented here.

Annual Report 2012

271
Islami Bank Bangladesh Limited (Off-Shore Banking Unit)
Balance Sheet
31.12.2012 31.12.2011
Property and assets Notes
USD Taka USD Taka
Cash in hand - - - -
Cash in hand (including foreign currency) - - - -
Balance with Bangladesh Bank & its agent - - - -
bank(s) (including foreign currency)
Balance with other banks & financial 1,685,770.41 134,608,599 355,723.54 29,117,003
institutions
In Bangladesh 2.0 1,685,770.41 134,608,599 355,723.54 29,117,003
Outside Bangladesh - - - -
Placement with banks & other financial - - - -
institutions
Investments in shares & securities - - - -

Government - - - -
Others - - - -
Investments 124,468,304.74 9,938,781,687 26,987,209.31 2,208,981,345
General investments etc. - - - -
Bills purchased & discounted 3.0 124,468,304.74 9,938,781,687 26,987,209.31 2,208,981,345
Fixed assets - - - -
Other assets - - - -
Non - banking assets - - - -
Total property and assets 126,154,075.15 10,073,390,286 27,342,932.85 2,238,098,348
Liabilities
Placement from banks & other financial 5.0 124,468,304.74 9,938,781,687 26,988,106.91 2,209,054,816
institutions
Deposits & other accounts - - - -

Mudaraba Savings Deposits - - - -
Mudaraba Term Deposits - - - -
Other Mudaraba Deposits - - - -
Al- Wadeeah Current and other deposit - - - -
accounts
Bills payable - - - -
Other liabilities 1,244,683.05 99,387,817 - -

Deferred tax liabilities /(assets) - - - -
Total liabilities 125,712,987.79 10,038,169,504 26,988,106.91 2,209,054,816
Capital/ share-holders’ equity 441,087.36 35,220,782 354,825.94 29,043,532

Paid - up capital - - - -
Statutory reserve - - - -
Other /translation reserves 6.0 - (3,303,771) - -
Retained earnings 7.0 441,087.36 38,524,553 354,825.94 29,043,532
Total liabilities & shareholders’ equity 126,154,075.15 10,073,390,286 27,342,932.85 2,238,098,348

31.12.2012 31.12.2011
Notes
USD Taka USD Taka
Off-balance sheet items
Acceptances & endorsements - - - -

Letters of guarantee - - - -
Irrevocable letters of credit (including back - - - -
to back bills)
Bills for collection - - - -
Other contingent liabilities - - - -
Total - - - -
Other commitments
Documentary credits, short term and trade - - - -

related transactions
Forward assets purchased and forward - - - -
deposits placed
Undrawn note issuance, revolving and - - - -
underwriting facilities
Undrawn formal standby facilities, credit - - - -
lines and other commitments
Total - - - -
Total off-balance sheet items including - - - -
contingent liabilities


Profit & Loss Account
31.12.2012 31.12.2011
Notes
USD Taka USD Taka
Operating income
Investment income 8.0 1,766,978.25 144,514,613 358,345.98 29,328,468

Profit paid on mudaraba deposits (6,641.23) (538,410) - -
Net investment income 1,760,337.02 143,976,203 358,345.98 29,328,468
Income from investments in shares & securi- - - - -

ties
Commission, exchange & brokerage 9.0 - - - -
income
Other operating income 10.0 21,200.00 1,733,870 1,800.02 147,319
Total operating income 1,781,537.02 145,710,073 360,146.00 29,475,787
Operating expenses
Salary & allowances 11.0 11,792.05 967,751 5,320.06 432,255

Rent, taxes, insurances, electricity etc. - - - -
Legal expenses - - - -
Postage, stamps and telecommunication - - - -
etc.
Stationery, printing and advertisement etc. - - - -
Chief executive’s salary & fees - - - -
Directors’ fees & expenses - - - -
Shari‘ah supervisory committee’s fees & - - - -
expenses
Auditors’ fees - - - -
Charges on investment losses - - - -
Depreciation and repair to bank’s assets - - - -
Zakat expenses - - - -
Other expenses 83,974.56 6,829,952 - -
Total operating expenses 95,766.61 7,797,703 5,320.06 432,255
Profit/ (loss) before provision 1,685,770.41 137,912,370 354,825.94 29,043,532
Provision for investments & off- balance 1,244,683.05 99,387,817 - -

sheet items
Provision for diminution in value of invest- - - - -
ments in shares
Other provisions - - - -
Total provision 1,244,683.05 99,387,817 - -
Total profit/(loss) before taxes 441,087.36 38,524,553 354,825.94 29,043,532

Current tax 12.0 - - - -
Deferred tax 12.0 - - - -
Net profit/ (loss) after tax 441,087.36 38,524,553 354,825.94 29,043,532
Retained earnings from previous year - - - -
Less: Interim dividend paid - - - -
Add: Net profit after tax 441,087.36 38,524,553 354,825.94 29,043,532
Profit available for appropriation 441,087.36 38,524,553 354,825.94 29,043,532
Less: Appropriation
Statutory reserve - - - -
General reserve - - - -
Retained earnings 441,087.36 38,524,553 354,825.94 29,043,532

Cash Flow Statement
31.12.2012 31.12.2011
USD Taka USD Taka
Cash flows from operating activities

Investment income 1,766,978.25 144,514,613 358,345.98 29,328,468
Profit paid on mudaraba deposits (6,641.23) (538,410) - -
Income/ dividend receipt from investments in shares - -
& securities
Fees & commission receipt in cash - - - -
Recovery from written off investments - - - -
Payments to employees (11,792.05) (967,751) (5,320.06) (432,255)
Cash payments to suppliers - - - -
Income tax paid - - - -
Receipts from other operating activities 21,200.00 1,733,870 1,800.02 147,319
Payments for other operating activities (83,974.56) (6,829,952) - -
i) Operating profit before changes in operating 29,043,532
1,685,770.41 137,914,370 354,825.94
assets & liabilities
Increase/decrease of statutory deposits - - - -

Increase/decrease of net trading securities - - - -
Increase/decrease of placement to other banks - - - -
Increase/decrease of investments to customers (97,481,095.43) (7,729,800,342) (26,987,209.31) (2,208,981,345)
Increase/decrease of other assets - - - -
Increase/decrease of deposits from other banks 98,724,880.88 7,829,114,688 26,988,106.91 2,209,054,816
Increase/decrease of deposits received from custom- - - - -
ers
Increase/decrease of other liabilities account of - - - -
customers
Increase/decrease of trading liabilities - - - -
Increase/decrease of other liabilities (1,599,508.99) (131,735,120) - -
(ii) Cash flows from operating assets and liabilities (355,723.54) (32,420,774) 897.60 73,471
Net cash flows from operating activities (A)=(i+ii) 1,330,046.87 105,491,596 355,723.54 29,117,003
Proceeds from sale of securities - - - -

Payment for purchase of securities/membership - - - -
Purchase/sale of property, plants & equipments - - - -
Purchase/sale of subsidiaries - - - -
Net cash flows from investing activities (B) - - - -
Receipts from issue of debt instruments - - - -

Payment for redemption of debt instruments - - - -
Receipts from issuing ordinary share/ rights share - - - -
Dividend paid in cash - - - -
Net cash flows from financing activities (C) - - - -
Net increase/(decrease) in cash (A+B+C) 1,330,046.87 105,491,596 355,723.54 29,117,003
Add/(less) effects of exchange rate changes on cash - - - -

& cash equivalent
Add:cash & cash equivalents at beginning of the year 355,723.54 29,117,003 - -
Cash & cash equivalents at the end of the year 1,685,770.41 134,608,599 355,723.54 29,117,003

Notes to the financial statements
1.0 Status of the Company
Off-shore Banking Units (OBU) of Islami Bank Bangladesh Ltd. governed under the rules and guidelines of Bangla-
desh Bank. The Bank obtained permission from Bangladesh Bank for operating of Off-shore Banking Units located
at Head Office Complex Branch, Dhaka, Agrabad Branch, Chittagong and Uttara Branch, Dhaka vide Bangladesh
Bank letter no. BRPD (P-3)744 (111)/2010-1032 dated 28 March 2010. The Bank has Commenced the operation of
its Off-shore Banking Units from 08.02.2011 at Head Office Complex Branch, Dhaka and from 27.09.2011 at Agrabad
Branch, Chittagong. Operations of OBU located at Uttara Branch, Dhaka will be started within shortly.
1.1 Principal activities
The principal activities of the OBU are to provide mudaraba investment against payment of import bills under UPAS
(Usance Payment at Sight) to its customers of Off-shore Banking Units in Bangladesh.
1.2 Significant accounting policies and basis of preperation of financial statements
1.2.1 Basis of accounting
The Off-shore Banking Units maintain its accounting records in USD from which accounts are prepared according to
the Bank Company Act, 1991, Bangladesh Financial Reporting Standards (BFRSs) and other applicable directives
issued by Bangladesh Bank.
1.2.2 Use of estimates and judgments
The preparation of financial statements requires management to make judgments, estimates and assumptions that
affect the application of accounting policies and the report amounts of assets, liabilities, income and experiences.
Actual results may differ from these estimates. The figures (Taka) appearing in these Financial Statements have
been rounded off to the nearest integer.
1.2.3 Foreign currency transactions
a. Foreign currencies transaction
Foreign currency transactions are converted in to equivalent Taka using the ruling exchange rates on the dates of
respective transactions as per BAS-21 “The Effects of changes in Foreign Exchange Rates”. Foreign currency bal-
ances held in US Dollars are converted into Taka at weighted average rate of inter-bank market as determined by
Bangladesh Bank on the closing date of every month.
b. Transaction gains and losses
The resulting exchange transaction gains and losses are included in the profit and loss account.
1.2.4 Cash flow statement
Cash flow statement has been prepared in accordance with the BAS-7 “Cash flow statement” under direct method
as recommended in the BRPD Circular No. 14, dated June 25, 2003 issued by the Banking Regulation and Policy
Department of Bangladesh Bank.
1.2.5 Reporting period
The financial statements cover from January 01 to December 31, 2012.
1.3 Assets and basis of their valuation
1.3.1 Cash and cash equivalents
Cash and cash equivalents include notes and coins on hand, unrestricted balances held with Bangladesh Bank and
highly liquid financial assets which are subject to insignificant risk of changes in their fair value, and are used by the
unit’s management for its short-term commitments.
1.3.2 Investments
Investment of OBU are stated in the balance sheet on gross/net basis. Profit is calculated on daily product basis but
charged and account for on realisation/cash basis.
1.4 Allocation of common expenses
Establishment expenses in the nature of rent, rates, taxes, management expenses, printing and stationery, electric-
ity, postage, stamps, telecommunication and audit fees etc. have not been separately accounted for in the financial
statements, but staff costs ( salaries and allowances) are separately accounted for OBU.

31.12.2012 31.12.2011
USD Taka USD Taka
2.0 Balance with other banks & financial institutions

In Bangladesh (balance with treasury) 1,685,770.41 134,608,599 355,723.54 29,117,003
Outside Bangladesh - - - -
Total 1,685,770.41 134,608,599 355,723.54 29,117,003
3.0 Investments 124,468,304.74 9,938,781,687 26,987,209.31 2,208,981,345
3.1 Bills purchased & discounted

Payable in Bangladesh - - - -
Payable outside Bangladesh 124,468,304.74 9,938,781,687 26,987,209.31 2,208,981,345
Total 124,468,304.74 9,938,781,687 26,987,209.31 2,208,981,345
4.0 Deposits & other accounts

Bank’s deposits - - - -
Customers deposits - - - -
Total - - - -
5.0 Borrowing from other banks, financial

institutions and agents
Bangladesh Bank - - - -
Islami Bank Bangladesh Ltd. 124,468,304.74 9,938,781,687 26,988,106.91 2,209,054,816
Total 124,468,304.74 9,938,781,687 26,988,106.91 2,209,054,816
6.0 Translation reserve

Balance as on 1 January - - - -
Addition/(adjustment) during the year (3,303,771) - -
Balance of retained earnings as at 31 December - (3,303,771) - -
7.0 Retained earnings: movement of surplus in

profit & loss account
Retained earnings as on 1 January - - - -
Addition during the year 441,087.36 38,524,553 354,825.94 29,043,532
Less: Foreign exchange gain - - - -
Balance of retained earnings as at 31 December 441,087.36 38,524,553 354,825.94 29,043,532
8.0 Investment income

Mudaraba documentary bills 1,766,978.25 144,514,613 358,345.98 29,328,468
9.0 Commission, exchange & brokerage income

Exchange income - - - -
10.0 Other Income - Service charge realized 21,200.00 1,733,870 1800.02 147,319
11.0 Salary & allowances :

i) Basic pay 7,060.03 579,554 3,092.31 251,250
ii) House rent allowance 2,917.75 239,648 1,546.16 125,626
iii) Medical allowance 791.48 64,820 430.15 34,950
iv) Entertainment allowance - - - -
v) Conveyance allowance 437.47 35,800 203.07 16,499
vi) Bank contribution to P.F. 585.32 47,929 48.37 3,930
Total 11,792.05 967,751 5,320.06 432,255
12.0 Provision for tax

Provision for current and deferred tax have not been separately accounted for in the financial statements of OBU. These
are accounted for directly in the main financial statements of the Bank.

Annexure-E
of

Report of the Directors

The directors present their report and financial statements for the year ended 31 December 2012.
Principal activities
The principal activities of the company are to open BO account under full DP of Central Depository Bangladesh
Limited (CDBL), provide Demate & Remate under full DP of CDBL, provide trading facility under brokerage
license, provide investment facility under Musharaka Mode and maintain own portfolio under dealer account.
Directors
The following Directors have held the office of the Company as on the reporting date:
1. Engr. Md. Eskander Ali Khan, Chairman (Appointed 29 March, 2010)
2. Md. Shahidul Islam, Vice Chairman (Appointed 29 March, 2010)
3. Md. Nazrul Islam (Appointed 29 March, 2010)
4. Professor N R M Borhan Uddin, Ph.D. (Appointed 07 February, 2013)
5. Mohd. Shamsul Haque (Appointed 29 March, 2010)
6. Md. Habibur Rahman (Appointed 29 March, 2010)
7. Md. Nurul Islam (Appointed 29 March, 2010)
8. Engr. Muhammad Abul Bashar (Appointed 06 September, 2011)
Auditor
ACNABIN Chartered Accountants was appointed as auditor of the Company.
Statement of directors’ responsibilities

The directors are responsible for preparing the Directors’ Report and the financial statements in accordance
with applicable laws and regulations.
Statement of disclosure to auditor

So far as the directors are aware, there is no relevant audit information of which the company’s auditor is
unaware. Additionally, the directors have taken all the necessary steps that they ought to have taken as
directors in order to make themselves aware of all relevant audit information and to establish that the company’s
auditor is aware of that information.
Status of the Company

ISLAMI BANK SECURITIES LIMITED was incorporated on the 22 March 2010 under the Companies Act,
1994 as a public limited company. It is a subsidiary company of Islami Bank Bangladesh Limited (IBBL) that
holds all the shares of the company except 54 (fifty four) shares being held by six individual shareholders. The
registered office of the company is situated at 20, Dilkusha, C/A in Dhaka, Bangladesh.
On behalf of the Board
Eng. Md. Eskander Ali Khan

Chairman

Independent Auditor’s Report
to the Shareholders of
ISLAMI BANK SECURITIES LIMITED
We have audited the accompanying financial statements of ISLAMI BANK SECURITIES LIMITED which
comprise the Statement of Financial Position as at 31 December 2012 and the Statement of Comprehensive
Income, Statement of Changes in Equity and Statement of Cash Flows for the year then ended and a summary
of significant accounting policies and other explanatory information.
Management’s Responsibility for the Financial Statements

Management is responsible for the preparation and fair presentation of these financial statements in
accordance with Bangladesh Financial Reporting Standards (BFRS) and for such internal control as
management determines is necessary to enable the preparation of financial statements that are free from
material misstatement, whether due to fraud or error.
Auditor’s Responsibility
Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our
audit in accordance with Bangladesh Standards on Auditing (BSA). Those standards require that we comply
with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the
financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the
financial statements. The procedures selected depend on the auditor’s judgment, including the risk assessment
of material misstatement of the financial statements, whether due to fraud or error. In making those risk
assessments, the auditor considers internal control relevant to the entity’s preparation and fair presentation
of the financial statements in order to design audit procedures that are appropriate in the circumstances, but
not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. An audit also
includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting
estimates made by management, as well as evaluating the overall presentation of the financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our
audit opinion.
Opinion
In our opinion, the financial statements give a true and fair view of the financial position of ISLAMI BANK
SECURITIES LIMITED as at 31 December 2012 and its financial performance and its cash flows for the year
then ended in accordance with Bangladesh Financial Reporting Standards (BFRS), Companies Act, 1994 and
other applicable laws and regulations.
Date: Dhaka ACNABIN

10 March 2013 Chartered Accounts

Statement of Financial Position
as at 31 December 2012
31.12.2012 31.12.2011
Notes
Taka Taka
Assets:
Non-Current Assets 314,779,703 316,896,286
Property, Plant & Equipment 3 8,537,118 10,057,305
Membership at Cost 4 304,453,399 304,453,399
Preliminary Expenses 5 324,075 432,100
Deferred Revenue Expenses 6 1,465,111 1,953,482
Current Assets 2,416,257,463 2,286,811,170
Cash & Bank Balances 7 296,279,119 86,648,966
Investment in Securities 8 1,245,476,289 1,327,316,725
Accounts Receivables 9 33,973,309 9,674,234
Advances, Deposits & Prepayments 10 1,328,296 2,779,710
Advance Income Tax 11 17,870,970 6,383,735
Investment in MTDR 12 821,329,479 854,007,801
Total Assets 2,731,037,166 2,603,707,456
Liabilities & Equity:

Equities 2,554,510,819 2,487,896,719
Share Capital 13 2,700,000,000 2,700,000,000
Retained Earnings (145,489,181) (212 ,103,281)
Non-Current Liabilities
Deferred Tax Liability 14 397,859 333,071
Current Liabilities 176,128,488 115,477,666
Accounts Payables 15 137,325,257 47,539,013
Provision for Income Tax 16 36,827,715 15,300,321
Provision for Expenses 17 429,182 666,179
Other Current Liabilities 18 1,546,334 1,589,856
Investment from IBBL (HOCB) 19 - 50,382,297
Total Equity & Liabilities 2,731,037,166 2,603,707,456
The annexed notes form an integral part of these Financial Statements.
Managing Director Director Chairman
This is the Statement of Financial Position referred to in our separate report of even date.
Dated: Dhaka ACNABIN

10 March 2013 Chartered Accountants

Statement of Comprehensive Income
for the year ended 31 December 2012
2012 2011
Notes
Taka Taka
Operating Income
Investment Income 20 139,022,005 70,813,001
Brokerage Commission 21 10,947,680 13,353,288
Other Operating Income 22 1,915,097 3,490,485
Total Operating Income 151,884,782 87,656,774
Operating Expenses
Salary & Allowances 23 10,116,810 9,187,108
Rent, Tax, Insurance & Electricity 24 2,481,976 2,812,501
BO Accounts Maintenance Expenses 1,240,400 1,357,600
Brokerage Expenses 25 575,408 734,009
Postage, Stamps and Telecommunications 26 111,190 105,915
Stationery, Printing and Advertisements 27 182,238 299,370
Repair & Maintenances 28 889,832 566,890
CDS Charges 913,767 1,781,942
Depreciation 2,725,891 2,426,110
Amortization 29 596,395 596,395
License Renewal Expenses 30 103,400 72,500
Other Expenses 31 1,016,799 1,420,746
Auditor’s Fees 75,000 5,000
Business Development Expenses - 909,350
Director’s Fees & Expenses - 276,000
Total Operating Expenses 21,029,106 22,551,437
Operating Profit 130,855,676 65,105,338
Unrealized gain (Loss) arising from investment in securities 32 (30,969,670) (289,077,029)
Profit (Loss) before Tax 99,886,006 (223,971,691)
Less: Tax Expenses
Current Tax 33,207,118 14,651,359
Deferred Tax 64,788 115,743
33,271,906 14,767,102
Net Profit (Loss) after Tax 66,614,100 (238,738,793)
Other Comprehensive Income - -
Total Comprehensive Income for the Year 66,614,100 (238,738,793)
This is the Statement of Comprehensive Income referred to in our separate report of even date.


Statement of Cash Flows
2012 2011
Notes
Taka Taka
A. Cash Flows from Operating Activities:
Net Profit after Tax 66,614,100 (238,738,793)
Adjustment for non-cash items: 34,291,956 292,356,226
Depreciation 2,725,891 2,426,110
Amortization 596,395 596,395
Unrealized gain (loss) in market value of securities 30,969,670 289,077,029
Loss on sale of fixed assets - 256,692
Cash Flows before Working Capital Changes (a) 100,906,056 53,617,433
Changes in Working Capital (b) 76,763,011 (78,233,741)
Increase (Decrease) in accounts payable 89,786,244 (109,842,421)
Increase (Decrease) in provision for income tax 21,527,394 6,782,197
Increase (Decrease) in provision for expenses (236,997) (3,852,659)
Increase (Decrease) in other current liabilities (43,522) (2,561,280)
Increase (Decrease) in deferred tax liabilities 64,788 115,743
Decrease (Increase) in advance, deposit & prepayments 1,451,414 2,843,921
Decrease (Increase) in accounts receivable (24,299,075) 34,664,493
Decrease (Increase) in advance income tax (11,487,235) (6,383,735)
Net Cash Flows from Operating Activities (a+b) 177,669,067 (24,616,308)
B. Cash Flows from Investing Activities:
Acquisition of fixed assets (1,205,704) (4,489,898)
Investments in Securites (1,123,091,966) (698,704,196)
Sale of investment in securities (Cost of sale) 1,173,962,731 580,234,296
Investments in MTDR (72,863,329) (854,007,801)
Encashment of Investments in MTDR 105,541,651 -
Received from sale of fixed assets - 402,100
Deferred revenue expenses - (2,441,852)
Net Cash used in Investment Activities 82,343,383 (979,007,351)
C. Cash Flows from Financing Activities:
Repayment of investment availed from IBBL(HOCB) (50,382,297) (2,441,292,512)
Receipt from issue of share capital - 2,400,000,000
Investment availed from IBBL(HOCB) - 1,000,000,000
Net Cash Flows from Financing Activities (50,382,297) 958,707,488
Net Increase (Decrease) in Cash & Bank balances (A+B+C) 209,630,153 (44,916,171)
Add: Cash & Bank balances at the beginning of the year 86,648,966 131,565,137
Cash & Bank balances at the end of the year 296,279,119 86,648,966
This is the Statement of Cash Flows referred to in our separate report of even date.


Amount in Taka
Particulars Paid-up Capital Retained Total Equity

Earnings
Opening balance as at 01 January 2011 (Note: 2.22) 300,000,000 26,635,512 326,635,512
Issue of share capital 2,400,000,000 - 2,400,000,000
Total comprehensive income for the year - (238,738,793) (238,738,793)
Balance as at 31 December 2011 2,700,000,000 (212,103,281) 2,487,896,719
Opening balance as at 01 January 2012 2,700,000,000 (212,103,281) 2,487,896,719
Total comprehensive income for the year - 66,614,100 66,614,100
Balance as at 31 December 2012 2,700,000,000 (145,489,181) 2,554,510,819
This is the Statement of Changes in Equity referred to in our separate report of even date.


Notes to the Financial Statements
as at and for the year ended 31 December 2012
1.0 Status of the Company
ISLAMI BANK SECURITIES LIMITED was incorporated on the 22 March 2010 under the Companies
Act, 1994 as a public limited company. It is a subsidiary company of Islami Bank Bangladesh Limited
(IBBL) that holds all the shares of the company except 54 (fifty four) shares being held by six individual
shareholders. The registered office of the company is situated at 20, Dilkusha, C/A in Dhaka,
Bangladesh.
1.1 Nature of Business
The main objective of the company is to carry on the business of a stock broker and stock dealer house
that is to buy, sell and deal in shares, stocks, debenture, bonds and other securities, and to carry on
any business as permissible for a broker and dealer house duly licensed by the Bangladesh Securities
and Exchange Commission (BSEC).
2.0 Significant Accounting Policies & Basis of Preparation of Financial Statements
2.1 Statement of Compliance
The financial statements have been prepared in accordance with--
a) Bangladesh Financial Reporting Standards (BFRS) except recognition of SND and MTDR profit
that are recognized on cash basis and measurement of investment in securities under own portfolio
as per BAS- 39 “ Financial Instrument: Recognition and Measurement”,
b) Companies act 1994,
c) and other relevant laws and regulations applicable in Bangladesh.
2.2 Basis of Preparation
The financial statements of the company have been prepared as a going concern basis based on the
historical cost convention.
2.3 Basis of Reporting
The financial statements are prepared and presented for external users by the company in accordance
with identified financial reporting framework. Presentation has been made in compliance with the
requirement of BAS-1- “Presentation of Financial Statements”.
2.4 Components of Financial Statements
The financial statements referred to here comprise:
a.
b.
c.
d. Statement of Changes in Equity and
e. Notes to the Financial Statements

2.5 Statement of Cash Flows
Statement of cash flows is prepared in accordance with the Bangladesh Accounting Standard-7
“Statement of Cash Flows” applying indirect method.
2.6 Reporting Period
These financial statements cover one calendar year from 1 January to 31 December 2012.
2.7 Property, Plant and Equipment (PP&E)
All Property ,Plant and Equipment are stated at cost less accumulated depreciation as per BAS-16 “
Property, Plant and Equipment”. The cost of acquisition of an asset comprises its purchase price and
any directly attributable cost of bringing the assets to its working condition for its intended use inclusive
of inward freight, duties and non-refundable taxes.
The company recognizes the cost of purchasing new assets or cost of replacing new assets in the carrying
amount of an item of property, plant and equipment when that cost is incurred if it is probable that the
future economic benefits embodied with the item will flow to the company and the cost of the item can be
measured reliably. Expenditure incurred after the assets have been put into operation, such as repair and
maintenances is normally charged off as revenue expenditure in the period in which it is incurred.
2.7.1 Depreciation Policy
Depreciation is charged at the following rates on a straight line method on motor vehicles and computers
& software and other assets are depreciated on reducing balance method according to their respective
percentage given below. Yearly depreciation has then been charged proportionately to 365 days.
Items Rate
Mechanical appliances 20-25%
Computers 25%
Furniture & fixtures 10-20%
Motor vehicles 20%
2.8 Investment in Membership
Investment in membership are stated at cost. The cost of acquisition of a membership comprises its
purchase price and any directly attributable cost of completing compliance requirements relevant to it
inclusive of stamp duty and non-refundable taxes, etc.
2.9 Advance Income Tax
The amount of advance income tax are mainly deduction of tax at sources by bank on profits arisen
from bank deposits (SND), MTDR profit and dividend income received against securities owned by the
company under portfolio investment.
2.10 Preliminary and Deferred Revenue Expenses
These are recognized as an asset if it is probable that future economic benefits that are attributable to
the asset will flow to the entity and cost of the asset can be measured reliably. All the preliminary and
deferred revenue expenses have been recognized as assets and as per Board’s decision all these
assets will be amortized over the period of 5 (five) years or at a rate of 20% commencing from the year
2011. All these assets are stated in financial position at cost less accumulated amortization.
2.11 Provision for Taxation
Provision for current income tax has been made in compliance with relevant provisions of income tax law.

2.12 Deferred Taxation
Deferred tax liabilities are the amount of income taxes payable in future periods in respect of taxable
temporary differences. Deferred tax assets are the amount of income taxes recoverable in future periods
in respect of deductible temporary differences. Deferred tax assets and liabilities are recognized for the
future tax consequences of timing differences arising between the carrying values of assets, liabilities,
income and expenditure and their respective tax bases. Deferred tax assets and liabilities are measured
using tax rates and tax laws that have been enacted or substantially enacted at the balance sheet
date. The impact on the account of changes in the deferred tax assets and liabilities has also been
recognized in the statement of comprehensive income as per BAS-12 “Income Taxes”.
2.13 Investment in Securities
Investment in securities means purchase of shares of quoted/listed companies in DSE & CSE through
stock dealer account. Investment is made in shariah complied securities for trading purpose and
investment purpose for short term, mid term and long term duration. Investment is valued at the lower of
cost or market value on the last date of reporting period and relevant unrealized gain (loss) is recognized
in income statement duly.
2.14 Dividend Income
All dividends received or receivable against the investment in securities hold under dealer account have
been considered as dividend income in comprehensive income statement. Dividend is recognized on
accrual basis and date of AGM of the company declaring dividend is considered as recognition base of
accrual dividend.
2.15 Capital Gain
The difference between cost price and net sales price of the securities is considered as capital gain. The
gain reported as income is only realized gain by selling different securities during the accounting year.
2.16 Musharaka Investment & Income
Musharaka investment means the margins (Investment facilities) provided to eligible clients under
brokerage operation in Musharaka principle/ mode of finance. As per Musharaka principle, profits arisen
through capital gain and dividend from this investment are shared between company and client as
per agreed ratio and loss is shared as per equity participation ratio. This investment is valued at the
lower of cost or market value on the last date of reporting period and relevant unrealized gain (loss) is
recognized in income statements duly.
2.17 Provisions
All provision is recognized on the financial statement date if, as a result of past events, the company
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.
2.18 Cash and Cash Equivalents
Cash and cash equivalents comprise cash in hand and cash at bank, which are held and available for
use by the company without any restriction and are readily convertible to a known amount of cash and
that are subject to an insignificant risk of change in value.
2.19 Advance, Deposits and Prepayments
Advances are initially measured at cost. After initial recognition, advances are carried at cost less
deductions, adjustments or charges to other account heads. Deposits are measured at payment value.
Prepayments are initially measured at cost. After initial recognition, prepayments are carried at cost less
charges to income statement.

2.20 Event after the Reporting Period
As per BAS - 10 “Events after the balance sheet date”, events after the reporting period are those
events, favorable and unfavorable, that occur between the end of the reporting period and the date
when the financial statements are authorized for issue. Two types of events can be identified:
i) those that provide evidence of conditions that existed at the end of the reporting period (Adjusting
events after the reporting period); and
ii) those that are indicative of conditions that arose after the reporting period (Non- adjusting events
after the reporting period).
There was no material events which have occurred after the reporting period which could affect the
values stated in the financial statements.
2.21 Related Party Disclosure

A party is related to the company if:
a. Directly or indirectly, through one or more intermediaries, that party controls, is controlled by, or is
under common control with the entity; has an interest in the entity that gives it significant influence;
or has joint control over the entity.
b. The party is an associate
c. The party is a joint venture in which the entity is a venturer
d. The party is a member of the key management personnel of the entity or of its parent.
e. The party is a close family member of any individual referred to in (a) or (d).
f. The party is an entity that is controlled, jointly controlled, or significantly influenced by or for which
significant voting power in such entity resides with, directly or indirectly any individual referred to in
(d) or (e).
g. The party is a postemployment benefit plan for the benefit of employees of the entity or of any entity
that is a related party of the entity.
i. Nature & type of related party transaction of the company
Name of related party Relationship Nature of transaction Amount

Islami Bank Bangladesh Limited (IBBL) Parent- subsidiary Bank balance 107,079,309
Islami Bank Bangladesh Limited (IBBL) Parent- subsidiary Investment in MTDR 821,329,479
Islami Bank Bangladesh Limited (IBBL) Parent- subsidiary Accounts payable 100,001,000
Islami Bank Bangladesh Limited (IBBL) Parent- subsidiary Investment from IBBL 50,382,297
Islami Bank Bangladesh Limited (IBBL) Parent- subsidiary Profit from Bank on MTDR 80,461,443
Managing Director Key management Short-term employee benefits 2,234,270
personnel (Salary & allowance)

2.22
General
a. The financial statements are presented in Bangladeshi Taka (BDT) currency, which is the company’s
functional currency.
b. The figures appearing in these financial statements are expressed in Taka currency and rounded off
to the nearest Taka.
c. Previous year’s figures have been rearranged, where necessary, to conform to current year’s
presentation. In 2010, a repayment of investment from IBBL wrongly shown as an expense. It was
an error at that time so subsequently it was rectified retrospectively restating the opening balance of
retained earnings of 2011 in the statement of changes in equity. Since the overall effect of this error is
not material to the financial statements as a whole of subsequent years hence no complete restated
opening balance of all balance sheet items has been presented in these financial statements.

31.12.2012 31.12.2011
Taka Taka
3 Property, Plant & Equipment
Cost
Opening balance at cost 12,683,545 8,937,500
Add: Assets purchased during the year 1,205,704 4,489,898
Less: Sale/Adjustment during the year - 743,853
Closing value at cost (a) 13,889,249 12,683,545
Depreciation
Opening balance 2,626,240 285,191
Add: Depreciation charged during the year 2,725,891 2,426,110
Less: Adjustment during the year - 85,061
Closing balance of depreciation (b) 5,352,131 2,626,240
Written Down Value (a - b) 8,537,118 10,057,305
Details are given in Appendix-I
4 Membership at Cost
DSE 24,453,399 24,453,399
CSE 280,000,000 280,000,000
304,453,399 304,453,399
5 Preliminary Expenses
Total value at cost as at 31.12.2012 540,125 540,125
Less: Accumulated amortization as at 31.12.2012 (216,050) (108,025)
324,075 432,100
6 Deferred Revenue Expenses
Total value at cost as at 31.12.2012 2,441,852 2,441,852
Less: Accumulated amortization as at 31.12.2012 (976,741) (488,370)
1,465,111 1,953,482
7 Cash & Bank Balances
Cash in hand 2,996 16,372
Cash at Bank 296,276,123 86,632,594
296,279,119 86,648,966
8 Investment in Securities
Own portfolio (Note 8.1) 1,215,619,167 1,302,642,757
Musharaka portfolio (Note 8.2) 29,857,122 24,673,968
1,245,476,289 1,327,316,725
8.1 Own Portfolio
Opening balance at cost 1,591,719,786 1,497,923,853
Add: Shares purchased during the year 1,116,095,487 999,387,067
Less: Cost of shares sold during the year (1,173,962,732) (580,234,296)
Adjustment against loss realization - (325,356,838)
Closing balance of investment at cost 1,533,852,541 1,591,719,786
Less: Unrealized gain/(loss) on own portfolio (318,233,374) (289,077,029)
Closing balance of investment 1,215,619,167 1,302,642,757

31.12.2012 31.12.2011
Taka Taka
8.2 Musharaka Portfolio
Musharaka investment at cost 31,670,447 24,673,968
Less: Unrealized gain (Loss) on portfolio (1,813,325) -
Closing balance of investment 29,857,122 24,673,968
9 Accounts Receivable
Receivable from DSE 989,809 1,296,065
Receivable from clients 700,845 474,569
Dividend receivable 2,242,200 7,903,600
Receivable from DSE (Dealer) 30,040,455 -
33,973,309 9,674,234
10 Advances, Deposits & Prepayments

Advance office rent for head office 1,242,500 2,733,500
Prepaid insurance premium 43,796 46,210
Prepaid Motor Car Maintenance 42,000 -
1,328,296 2,779,710
11 Advance Income Tax

Opening balance 6,383,735 -
Add: Advance tax paid during the year (Note 11.1) 17,870,970 6,383,735
Less: Adjustment against tax assessment (6,383,735) -
17,870,970 6,383,735
11.1 Advance Tax paid During the Year

TDS on Bank deposit profit 8,406,626 2,510,492
TDS against dividend income 3,353,203 1,949,560
TDS on brokerage commission by CSE 907 1,923,683
TDS on brokerage commission by DSE 1,110,234 -
Advance income tax 5,000,000 -
17,870,970 6,383,735
12 Investment in MTDR
Opening balance 854,007,801 -
Add: New/Reinvestment during the year 72,863,329 854,007,801
Less: Encashment during the year (105,541,651) -
821,329,479 854,007,801
13 Share Capital
Authorized Capital
5,000,000 ordinary shares of Taka 1,000 each. 5,000,000,000 5,000,000,000

Paid- up Capital 31.12.2012 31.12.2011
Taka Taka
27,00,000 ordinary shares of Taka 1,000 only each:

No. of
Name of shareholder Percentage
shares
1) IBBL (Represented by four directors) 2,699,946 99.9982 2,699,946,000 2,699,946,000
2) Janab Mohd. Shamsul Haque 9 0.0003 9,000 9,000
3) Janab Md. Habibur Rahman 9 0.0003 9,000 9,000
4) Janab Md. Nurul Islam 9 0.0003 9,000 9,000
5) Janab Muhammad Abul Bashar 9 0.0003 9,000 9,000
6) Janab Abu Taher Mohammad Saleh 9 0.0003 9,000 9,000
7) Janab Syed Abdullah Mohammad Saleh 9 0.0003 9,000 9,000
2,700,000 100.00 2,700,000,000 2,700,000,000
31.12.2012 31.12.2011
Amount in Taka Amount in Taka
14 Deferred Tax Liability
Accounting base of fixed assets 7,563,057 5,859,038
Tax base of fixed assets 6,502,099 4,970,848
Taxable temporary difference (TTD) 1,060,958 888,190
Deferred tax liabilities ( 37.5% of TTD) 397,859 333,071
15 Accounts Payable
Payable to clients 128,525,872 41,891,007
Payable to DSE 3,083 4,134,012
Payable to DSE (Dealer) 10,397 1,281,719
Payable to CSE (Dealer) 8,770,905 189,137
Software annual maintenance fees 15,000 30,000
Payable to CSE - 13,138
137,325,257 47,539,013
16 Provision for Income Tax
Opening balance 15,300,321 8,518,124
Add: Provision of income tax for the year 33,207,118 14,651,359
Less: Adjustment against assessment (11,679,724) (7,869,162)
Adjustment against advance tax (6,383,735) -
Payment of tax for settlement (5,295,989) (7,869,162)
36,827,715 15,300,321
17 Provision for Expenses
Auditor’s fees 75,000 55,000
CDS charges 129,246 29,760
Electricity bills 3,612 4,842
Network expenses 18,050 18,050
Newspaper bills 1,226 1,234
Office rents 101,534 406,134
Professional & consultancy fees 35,000 35,000
Service charges 15,750 13,250
Telephone bills 16,167 17,852
Wages 25,500 51,066
Water bills 3,400 3,668
Office maintenance 4,697 -
Motor car maintenances - 30,323
429,182 666,179

31.12.2012 31.12.2011
Taka Taka
18 Other Current Liabilities
Security deposit from clients 1,120,779 1,129,779
Security deposits payable on fixed assets (Note 18.1) 409,348 460,077
Sundry creditors 16,207 -
1,546,334 1,589,856
18.1 Security Deposits Payable on Fixed Assets

Talukder enterprise 103,500 103,500
Computer source 145,500 145,500
Digilog system 5,550 5,550
Partex furniture 16,530 16,530
Gazi communication 33,180 33,180
Net com. 39,088 39,088
Leads corporation 66,000 -
Islam brothers - 116,729
409,348 460,077
19 Investment from IBBL (HOCB)

Opening balance 50,382,297 1,500,000,000
Add: Investment received during the year - 1,000,000,000
Less: Repayment/Adjustment of investment (50,382,297) (2,449,617,703)
- 50,382,297
20 Investment Income
Dividend from investment in securities 11,283,464 17,985,227
Profit from Bank on SND 6,300,071 2,874,624
Profit from Bank on MTDR 80,461,443 26,303,830
Capital gains (Note 21.1) 40,977,027 23,649,320
139,022,005 70,813,001
20.1 Capital Gains

Capital gains from sale of securities 40,099,005 71,323,796
Capital gains from Musharaka investment 878,022 689,352
Less: Adjustment against capital loss - (48,363,828)
40,977,027 23,649,320
21 Brokerage Commissions
Commission on CSE turnover 8,882 66
Commission on DSE turnover 10,938,798 13,353,222
10,947,680 13,353,288
22 Other Operating Income
Account opening fees 216,000 309,600
BO accounts maintenance fees 1,549,000 1,697,500
Dividend from Musharaka investment (Margin 130,597 20,108
account)
Documentation fee (Margin account) 5,000 15,500
Miscellaneous income 14,500 28,979
Cash back rebate from CDBL - 930,199
Demeat fees - 6,109
Recruitment fees - 444,100
Share transfer fees - 38,390
1,915,097 3,490,485

31.12.2012 31.12.2011
Taka Taka
23 Salary & Allowances
Salary 9,042,796 8,264,585
Eid bonus 918,465 725,241
Wages 155,549 134,989
Daily allowances - 58,968
Overtime allowance - 3,325
10,116,810 9,187,108
24 Rents, Taxes, Insurance & Electricity
Office rents 2,293,041 2,615,604
Renewal of tax token for motor vehicles 11,604 11,604
Insurance premiums 54,969 75,041
Electricity bills 122,362 110,252
2,481,976 2,812,501
25 Brokerage Expenses
DSE Howla charges 128,840 161,438
DSE Laga charges 444,093 570,601
Investors’ protection fund charges 1,955 1,970
CSE Howla charges 202 -
CSE Laga charges 318 -
575,408 734,009
26 Postage, Stamps and Telecommunications

Telephone bills 110,875 88,214
Postage 315 481
Stamps - 17,220
111,190 105,915
27 Stationery, Printing & Advertisements
Stationeries expenses 158,238 273,974
Advertisements 24,000 25,350
Photocopy expenses - 46
182,238 299,370
28 Repair & Maintenance
Motor car running & maintenance 508,577 341,012
Office maintenances 59,312 16,015
Other repair & maintenance 40,343 10,930
Software annual maintenance fees 65,000 80,000
Network support 216,600 118,933
889,832 566,890
29 Amortization
Amortization of preliminary expense 108,025 108,025
Amortization of deferred revenue expenses 488,370 488,370
596,395 596,395
30 License Renewal Expenses
Renewal fees for Depository Participant (DP) 4,000 4,000
Renewal fees for DSE membership 20,000 20,000
Other renewal fees 4,400 48,500
Renewal fees for CSE membership 20,000 -
Renewal of trade license fees 55,000 -
103,400 72,500

31.12.2012 31.12.2011
Amount in Taka Amount in Taka
31 Other Expenses
Annual subscription fees 9,700 20,000
Bank charges 85,565 78,109
Conveyances 13,399 25,119
Computer accessories 128,910 270,655
Electronic expenses 56,303 7,600
Entertainments 150,212 271,561
Internet bills 72,450 67,874
Miscellaneous expenses 23,541 11,397
Newspaper, magazine & periodicals 15,646 20,199
Professional & consultancy fees 70,000 49,030
Service charges 177,717 178,940
Tour & travels 5,000 102,267
Water bills 47,682 55,053
BO accounts maintenance subsidy 145,274 -
Software expenses 15,400 -
Loss on sale of fixed assets - 256,692
Photograph expenses - 1,250
Training programme expenses - 5,000
1,016,799 1,420,746
32 Unrealized Gain (Loss) Arising from Investment in Securities
Against own portfolio during the year (Note 32.1) (29,156,345) (289,077,029)
Against musharaka portfolio during the year (Note 32.2) (1,813,325) -
(30,969,670) (289,077,029)
31.12.2012 31.12.2011
Taka Taka
32.1 Against Own Portfolio During the Year
Investment in securities at market as at 31.12.2012 1,098,993,789 1,302,642,757
Investment in securities at cost price as at 31.12.2012 1,533,852,541 1,591,719,786
Total unrealized gain (loss) as at 31.12.2012 (434,858,752) (289,077,029)
Less: Opening balance of unrealized gain (loss) (289,077,029) -
Total unrealized loss for the year 2012 (145,781,723) (289,077,029)
Less: 80% provision which are kept for adjustment in next four Quarters 116,625,378 -
(29,156,345) -
As per Directive # SEC/CMRRCD/2009-193/144 dated 27 February 2013 of Bangladesh Securities and Exchange
Commission, 20% provision has been made for unrealized loss arising out of year-end (31.12.2012) revaluation of
shares purchased through Own Portfolio. The Directive prohibits payment of cash dividend if the company makes less
than 100% provision on such unrealized loss.
32.2 Against Musharaka Portfolio During the Year
Investment in securities at market as at 31.12.2012 22,603,822 -
Investment in securities at cost as on 31.12.2012 31,670,447 -
Total unrealized gain (loss) as at 31.12.2012 (9,066,625) -
Less: Opening balance of unrealized gain(loss) - -
Total unrealized loss for the year 2012 (9,066,625) -
Less: 80% provision which are kept for adjustment in next four Quarters 7,253,300 -
(1,813,325) -
As per Directive # SEC/CMRRCD/2009-193/144 dated 27 February 2013 of Bangladesh Securities and Exchange
Commission, 20% provision has been made for unrealized loss arising out of year-end (31.12.2012) revaluation of
shares purchased through Musharaka Portfolio. The Directive prohibits payment of cash dividend if the company makes
less than 100% provision on such unrealized loss.

Appendix-I

Schedule of Property, Plant & Equipment
as at 31 December 2012
a) Year : 2012
Cost Depreciation W.D.V.

Particulars Balance as at Balance as at Balance as at Charged during Balance as at as at
Addition Adjustment Adjustment 31.12.2012
01.01.2012 31.12.2012 01.01.2012 the year 31.12.2012
Mechanical Appliances 1,402,180 210,796 - 1,612,976 269,708 264,981 - 534,689 1,078,287
Computer & Software 3,703,135 799,908 - 4,503,043 768,105 1,108,539 - 1,876,644 2,626,399
Furniture & fixture 2,102,230 55,000 - 2,157,230 310,694 254,870 - 565,564 1,591,666
Motor vehicles 5,476,000 140,000 - 5,616,000 1,277,733 1,097,501 - 2,375,234 3,240,766
Total as at 31.12.2012 12,683,545 1,205,704 - 13,889,249 2,626,240 2,725,891 - 5,352,131 8,537,118
b) Year : 2011
Cost Depreciation W.D.V.

Particulars Balance as at Balance as at Balance as at Charged during Balance as at as at
Addition Adjustment Adjustment 31.12.2011
01.01.2011 31.12.2011 01.01.2011 the year 31.12.2011
Mechanical Appliances 1,225,000 367,180 190,000 1,402,180 34,145 279,210 43,647 269,708 1,132,472
Computer & Software 723,000 3,041,635 61,500 3,703,135 36,747 739,446 8,088 768,105 2,935,030
Furniture & fixture 1,513,500 1,081,083 492,353 2,102,230 31,766 312,254 33,326 310,694 1,791,536
Motor vehicles 5,476,000 - - 5,476,000 182,533 1,095,200 - 1,277,733 4,198,267
Total as at 31.12.2011 8,937,500 4,489,898 743,853 12,683,545 285,191 2,426,110 85,061 2,626,240 10,057,305
Annual Report 2012

295
Annexure-F
of
Islami Bank Capital Management Limited (IBCML)

Auditor’s Report
to the Shareholders of Islami Bank Capital Management Limited
We have audited the accompanying financial statements of Islami Bank Capital Management Limited which comprise
the Statement of Financial Position as of 31 December 2012 and the related Statement of Comprehensive Income,
Statement of Changes in Equity and Statement of Cash Flows and a summary of significant accounting policies and
other explanatory information.
Management Responsibilities for the Financial Statements

Management is responsible for the preparation and fair presentation of these financial statements in accordance with
Bangladesh Financial Reporting Standards and for such internal control as management determines is necessary to
enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.
Auditor’s Responsibility
Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our
audit in accordance with Bangladesh Standards on Auditing. Those standards require that we comply with ethical
requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements
are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial
statements. The procedures selected depend on the auditor’s judgment including the assessment of the risks of
material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the
auditor considers internal control relevant to the entity’s preparation and fair presentation of the financial statements
in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing
an opinion on the effectiveness of the entity’s internal control. An audit also includes evaluating the appropriateness
of accounting policies used and the reasonableness of accounting estimates made by management, as well as
evaluating the overall presentation of the financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.
Opinion
In our opinion, the financial statements give a true and fair view of the financial position of Islami Bank Capital
Management Limited as of 31 December 2012, and of its financial performance and its cash flows for the year then
ended in accordance with Bangladesh Financial Reporting Standards and comply with the Companies Act 1994, the
Securities and Exchange Act 1993, the Securities and Exchange Rules 1987, conditions for Registration issued by
the Securities and Exchange Commission and other applicable laws and regulations.
We also report that:
a) we have obtained all the information and explanations which to the best of our knowledge and belief were
necessary for the purposes of our audit and made due verification thereof;
b) in our opinion, proper books of account as required by law have been kept by the company so far as it appeared
from our examination of those books;
c) these financial statements dealt with by this report are in agreement with the books of account and returns; and
d) the expenditure incurred was for the purpose of business of the Islami Bank Capital Management Limited.
Dhaka, ACNABIN

Islami Bank Capital Management Limited
31.12.2012 31.12.2011
Notes
Taka Taka
ASSETS
Non-current assets
Preliminary expenses 3 537,485 537,485
Total non-current assets 537,485 537,485
Current assets
Cash & bank balances 4 358,979,268 335,347,031
Prepaid rent 5 458,500 1,008,700
Advance income tax 6 22,101,332 4,125,038
Total current assets 381,539,100 340,480,769
Total assets 382,076,585 341,018,254
EQUITIES AND LIABILITIES

Equities
Share capital 7 300,000,000 300,000,000
Retained earnings 51,283,442 25,583,801
Total equity 351,283,442 325,583,801
Liabilities
Non-current liabilities - -
Current Liabilities
Accrued expenses 8 23,000 20,900
Provision for income tax 9 30,770,065 15,350,280
Other payables 10 78 63,273
Total current liabilities 30,793,143 15,434,453
Total equities and liabilities 382,076,585 341,018,254
The annexed notes form an integral part of the Statement of Financial Position.
Director Director Director Chairman

This is the Statement of Financial Position referred to in our report of even date.
Dhaka, ACNABIN

2012 2011
Notes
Taka Taka
Other income 11 41,750,739 35,672,794

Total income 41,750,739 35,672,794
Less: Operating expenses
Bank charge 12 6,650 20,575

Office rent 13 599,718 613,473
Entertainment expenses 1,945 -
Audit fees 23,000 20,900
Total operating expenses 631,313 654,948
Profit before tax 41,119,426 35,017,846
Provision for income tax 15,419,785 13,131,692
Profit after tax 25,699,641 21,886,154
The annexed notes forms an integral part of the Statement of Comprehensive Income.
Director Director Director Chairman

This is the Statement of Comprehensive Income referred to in our report of even date.

Dhaka, ACNABIN

(Amount in Taka)
Paid-up Capital Retained Earnings Total
Particulars
Balance as at 01 January 2011 - 3,697,647 3,697,647
Issue of share capital 300,000,000 - 300,000,000
Net profit for the year - 21,886,154 21,886,154
Balance as at 31 December 2011 300,000,000 25,583,801 325,583,801
Balance as at 01 January 2012 300,000,000 25,583,801 325,583,801
Issue of share capital - - -
Net profit for the year - 25,699,641 25,699,641
Balance as at 31 December 2012 300,000,000 51,283,442 351,283,442

2012 2011
Taka Taka
Cash flows from operating activities
Profit before tax 41,119,426 35,017,846
Adjustment - -
Adjusted operating profit before changes in working capital 41,119,426 35,017,846
Changes in working capital:

Decrease in prepaid rent 550,200 550,200
(Increase) in advance income tax (17,976,294) (3,534,413)
(Decrease)/increase in other payables (63,195) 59,231
Increase/(decrease) in accrued expenses 2,100 (2,100)
Net cash (used in)/generated from operating activities (A) 23,632,237 32,090,764
Cash flow from investing activities (B) - -
Cash flows from financing activities (C) - -
Net increase/(decrease) in cash & cash equivalent for the period (A+B+C) 23,632,237 32,090,764
Add: Cash & bank balance at beginning of the year 335,347,031 303,256,267
Cash & bank balances at end of the year 358,979,268 335,347,031

Notes to the Financial Statements
1. Status of the Company
Islami Bank Capital Management Ltd. was incorporated on 01 April 2010 under the Companies Act,
1994 as a Public Limited Company. It is a subsidiary company of Islami Bank Bangladesh Limited.
Islami Bank Bangladesh Limited holds all the shares of the company except 7 shares which are held
by 7 individuals. The company has been established as per Bangladesh Bank letter # BRPD (R-
1)717/2010-47 dated 7 February 2010. The registered office of the company is situated at 63 Dilkusha,
Dhaka.The main objectives of the company are to carry on business of Merchant Banking in all its
aspects including Underwriting and/or management of issue, public offer of shares, stocks, debentures,
bonds, etc.; sale or purchase of securities or transfer thereof; fund management for clients, underwriting
of shares, stocks, debentures, bonds, etc.; managing portfolio investments of any person or company,
by investment in various avenues, etc.
2. Significant accounting policies
2.1 Basis of presentation of financial statements
The financial statements of the company have been prepared applying accrual basis of accounting
under historical cost convention in accordance with Bangladesh Financial Reporting Standards (BFRS)
and other applicable laws and regulations.
2.2 Revenue recognition
Revenue is recognised only when it is probable that the economic benefits associated with the
transaction will flow to the entity. Revenue during the period is recognised by way of profit on Mudaraba
Deposits.
2.3 Statement of cash flows
Statement of Cash Flow has been presented under indirect method.
2.3 General
The figures appearing in these Financial Statements have been rounded off to the nearest integer.

31.12.2012 31.12.2011
3. Preliminary expenses Taka Taka
Incorporation fees 474,625 474,625

Trade license fees 13,100 13,100
TIN certificate fees 2,500 2,500
Professional fees 41,800 41,800
Bank charges for issuing MICR cheque 150 150
CIB service charge 500 500
SEC application Fees 1,000 1,000
Stamps 600 600
Register & seal 310 310
Miscellaneous 2,900 2,900
537,485 537,485

31.12.2012 31.12.2011
Taka Taka
4. Cash & bank balances
Cash in hand - 422

Cash at bank & other financial institution (Note 4.1) 358,979,268 335,346,609
358,979,268 335,347,031
4.1 Cash at bank & other financial institution

Name of bank & institution
Islami Bank Bangladesh Limited 558,782 8,251,270
Shahjalal Islami Bank Limited 252,795,518 226,744,438
EXIM Bank Limited 63,140,750 56,633,731
First Security Bank Limited 42,483,218 43,717,170
Islami Bank Securities Limited 1,000 -
358,979,268 335,346,609
5. Prepaid rent
Advance payment for office rent 1,008,700 1,558,900
Less: Adjusted during the year 550,200 550,200
458,500 1,008,700
6. Advance income tax
Opening balance 4,125,038 590,625
Deducted at source during the year: 4,156,362 3,534,413
Shahjalal Islami Bank Ltd. 723,002 623,679
Exim Bank Bangladesh Ltd. 2,894,564 2,496,604
First Security Islami Bank Ltd. 538,796 414,130
Paid by IBCML during the year 13,819,933 -
22,101,332 4,125,038
7. Share capital
Authorised capital
1,000,000 ordinary shares of Tk.1,000 each. 1,000,000,000 1,000,000,000
Issued, subscribed and paid up capital
300,000 ordinary shares of Tk.1,000 each fully paid 300,000,000 300,000,000
Details of shareholding are as under:
Name of the shareholders No. of
Share
Islami Bank Bangladesh Limited 299,993 299,993,000 299,993,000
Janab M. Fariuddin Ahmad 1 1,000 1,000
Janab Mohammad Abdul Mannan 1 1,000 1,000
Janab Md. Setaur Rahman 1 1,000 1,000
Janab Gulam Moula Choudhury 1 1,000 1,000
Janab A.K.M Malek Chowdhury 1 1,000 1,000
Janab Nurul Islam Khalifa 1 1,000 1,000
Janab Abdus Sadeque Bhuiyan 1 1,000 1,000
300,000 300,000,000 300,000,000

31.12.2012 31.12.2011
Taka Taka
8. Accrued expenses
Audit fees 20,000 20,000
Add: VAT 3,000 900
23,000 20,900
9. Provision for income tax

Opening balance 15,350,280 2,218,588
Add: Provision made during the year 15,419,785 13,131,692
Less: Settlement during the year - -
30,770,065 15,350,280
10. Other payables

Other payable 78 -
VAT payable on rent - 63,273
78 63,273
11. Other income 2012 2011

Taka Taka
Profit from MTD & MSND accounts:
Name of bank
Shahjalal Islami Bank Limited 7,230,022 6,236,785
EXIM Bank Limited 28,945,643 24,966,042
First Security Bank Limited 5,387,961 4,141,300
Islami Bank Bangladesh Limited 187,113 328,667
41,750,739 35,672,794
41,750,739 35,672,794
12. Bank charge

Account maintenance charge of IBSL 500 -
Account maintenance charge of banks 1,150 575
Excise duty 5,000 20,000
6,650 20,575
13. Office rent
Rent 550,200 550,200
VAT 49,518 63,273
599,718 613,473

Particulars of Head Office, Zonal Offices,
Branches and SME/Krishi Shakha
Head Office Zonal Offices

Sl. Phone Number & Sl. Name of the Office Phone Number &
Name of the Office & Address
No. E-mail Address No. & Address E-mail Address
1 Head Office PABX: 02- 9563040, 1 Dhaka Central Zone 8362278, 8332094
Islami Bank Tower, 9560099 01730-326106, 30 Anjuman Mofidul Islam Road, E-mail: dhakacentral@
40, Dilkusha C/A, Dhaka-1000 01713-438566, web-site: Kakrail, Dhaka islamibankbd.com
www.islamibankbd. com 2 Dhaka South Zone 8319300, 8312941
30 Anjuman Mofidul Islam Road, E-mail:dhakasouth@
Head Office PABX-9568312, 9568346,
Kakrail, Dhaka islamibankbd.com
(Vigilance Squad, AMD, Law, 9567856; RDD
Recovery) (Mob. 01755-538502) 3 Dhaka North Zone 8322068, 9355702
28, Dilkusha C/A, Dhaka-1000. 30 Anjuman Mofidul Islam Road, E-mail: dhakanorth@
Kakrail, Dhaka. islamibankbd.com
Head Office (IAD,Retail, PABX: 02- 9563040, 4 Chittagong North Zone (031) 716294, 2523273
Consumer & Real Estate 9560099 03, CDA, Sheikh Mujib Road., E-mail: ctgnorth@
Investment Division) Agrabad C/A, Chittagong islamibankbd. com
39, Dilkusha C/A, Dhaka-1000.
5 Chittagong South Zone (031) 715650, 726598,
Head Office (BCD) PABX: (02) 7113750, 03, CDA, Sheikh Mujib Road., 01755-532603 E-mail:
20, Dilkusha (9th Floor) C/A, 7113542 01755-524571 Agrabad C/A, Chittagong ctgsouth@islamibankbd. com
Dhaka-1000, (BACH Manager) 6 Khulna Zone 041-722988, 723941,
Head Office (Marketing Division) PABX: (02) 7113750, 4, Old Jessore Road, Khulna 812533, 01730-727390,
20, Dilkusha (9th Floor) C/A, 7113542 E-mail:ibblzokl@bttb.net.bd
Dhaka-1000 7 Bogra Zone 051-69310,69410
801,Thana Road, Bogra E-mail:bograzone@
Head Office (CSD) PABX # 7113750, 7113542
islamibankbd .com
20, Dilkusha (6th Floor) C/A,
8 Sylhet Zone 0821-710093, 723627,
Dhaka-1000
2/1, Main Road, J-Block, Shahjalal E-mail:sylhetzone@
Head Office (Engineering PABX # 7113750, 7113542, Upashahar, Sylhet islamibankbd .com
Division) 9571475, 9571506, 95715 9 Comilla Zone 081-63375, 77072,
20, Dilkusha ( 8th Floor) C/A, 74, 9571602, 7115575, Paduar Bazar, Biswa Road, E-mail: comillazone @
Dhaka-1000 71 15521,Fax -88-02- Comilla-3500. islamibankbd.com
9571574
10 Barisal Zone 0431-72016, 0431-72018,
Head Office (CSRD) PABX: (02) 7120015, Kuwait Plaza , Sagardi Bazar, E-mail:barisalzone@
20, Dilkusha (6th Floor) C/A, 9571602; Ext: 756 to 758. Barisal islamibankbd.com
Dhaka-1000 11 Rajshahi Zone 0721-812737, 771543,
Head Office {RDD,CIB,Share, 9564595 (Share), 9554635 356, Station Road, Rajshahi Email:Zone_rajshahi@
FAD ( Recon, PF, Salary, Bills, (FAD-Recon) islamibankbd.com
Budget & 10% Income Tax ) Fax: 88-02- 9564595 12 Mymensingh Zone 091-65745, 01730-729739
63, Dilkusha C/A, Dhaka-1000 Islami Bank Plaza, 76/A, Choto E-mail: mymensinghzone@
Bazar, Mymensingh. islamibankbd.com
Head Office (ICTW),IBW 01730-730162 To
Otobi Building, 14 Dilkusha (7th & 01730-730167 13 Noakhali Zone (0321) 63102, (0321)
9th Floor), Dhaka. Sufia Shopping Centre, Main Road, noakhalizone@
Moijdee Court, Noakhali. islamibankbd.com
Foreign Remittance Services 01730-730162 To
14 Rangpur Zone 0521-55463 rangpurzone@
Division. 01730-730167
Almi Bari, 30, Jail Road, islamibankbd.com
IBW, Otobi Building, 14 Dilkusha
Dhap, Rangpur.
(7th & 9th Floor), Dhaka.
BACH & DBA Section; FTPD, 01730-736076,
ICTD Support Team, Otobi 01755-532492; Dhaka Division
Building, 14 Dilkusha, Dhaka. 01755-524570
Sl. Name of the Branch Phone Number &
Head Office (ICCW) Dhaka, 9355371, 9355372, No. & Address E-mail Address
Islami Bank Hospital Complex, 9346181, 1 Araihazar Branch 01755 – 629462
30, Anjuman Mofidul Islam Road, Fax-88-02- 9355371 Bazar Masjid Road, Araihazar
Kakrail, Bazar, Narayanganj- 1450.
Card Division 01755-521990 2 Badda Branch 01730-328873
ICTD, Head Office, 62, Shaid Kha/194, Pragati Sarani E-mail: badda@
Tajuddin Ahmed Sharoni, Maddhya Badda, Dhaka-1212 islamibankbd.com
Mohakhali, Dhaka-1212
3 Bangshal Branch* (02) 9556826, 7175792
IBTRA 02-9133411, 8127625, 222, Bangshal Road, Dhaka . E-mail: bangshal@
13-A/2-A, Block-B, Babar Road, 9139951, E-mail: dib. islamibankbd.com
Mohammadpur, Dhaka-1207 ibtra@islamibankbd.com

Dhaka Division No. & Address E-mail Address
Sl. Name of the Branch Phone Number & 24 Gopalganj Branch 02-6685005, 01711-
No. & Address E-mail Address 727, Madrasha Road, Gopalganj. 693941, E-mail:gopalgonj@
4 Baridhara Branch 01755-551138 islamibankbd.com
Abed Ali Tower, Ka/59, Progati E-mail: baridhara@ 25 Gulshan Branch* (02) 8825424, 01711-
Sharani, Gulshan, Dhaka- 1212 islamibankbd.com PBL Tower , 39 (old), 17 (new) 693915, E-mail: gulshan@
North Gulshan C/A, Dhaka-1212. islamibankbd.com
5 Bhairab Branch (0294) 70289, 01711-
26 Gulshan Circle-1 Br. 02-8850352
82 & 84 Misti Patty, Bhairab, 431278, E-mail:bhairab@
6, SW(H), Gulshan Avenue, E-mail:gulshan1@
Kishoreganj islamibankbd .com
Gulshan-1, Dhaka. islamibankbd.com
6 Bhulta Branch (03895) 787027, 27 Haji Camp Branch 02-8919293, 01711-
Haji Shopping Complex 01713-425963 E-mail: Ashkona, Uttara, Dhaka 693944, E-mail:hajicamp @
Bhulta, Rupganj, Narayanganj, bulta@islamibankbd.com islamibankbd.com
28 Head Office Complex Branch* 02-9570911, 01755-521991,
7 Board Bazar Branch 02-9292942 Islami Bank Tower, 40, Dilkusha E-mail: hocc@islamibankbd.
Chairman Plaza, Dhaka-Mymensing 01730-703852, E-mail : C/A, Dhaka-1000. com
Main Road, Gazipur-1704. boardbazar@islamibankbd. 29 IDB Bhaban Branch 02-9183161-2, E-mail:
com E/8 - A, Begum Rokeya Sharani, idbbhaban@islamibankbd.
8 Bakshiganj Branch 01730-727391, 01755- Agargaon, Dhaka-1207 com
Haji Sonaullah Mansion, 636217 30 Islampur Branch* (2) 7393918, 01711-
Bakshiganj, Jamalpur 41-42, Islampur Road, Dhaka 693909, E-mail: islampur @
9 Cantonment Branch (02) 9872397 islamibankbd.com
24, Mamata Shopping Complex, 01711-693934 31 Jamalpur Branch 0981-63356, 01711-
Uttar Kafrul, Dhaka Cantonment, mail:cantonment@ 3604/3181, Jam-e-Masjid Road, 693922, E-mail:jamalpur@
Dhaka-1206. islamibankbd.com Jamalpur. islamibankbd.com
10 Chawk Mugaltuly Branch* (02) 7318013, 7313508, 32 Jatrabari Branch (02) 7546200,
93, Chawk Mugaltully, Dhaka E-mail: cmb@islamibankbd. 69, Shahid Faruque Sarak, South E-mail: jatrabari@
Com Jatrabari, Dhaka-1204, islamibankbd.com
11 Damodya Branch 06023-56332 33 Kanchpur Branch 02-7691556,
Sheikh Ali Ashraf Complex, 01713-425964 Chittagong Road, Siddhirganj, E-mail: recon.kanchpur@
Damodya, Shariatpur. E-mail : recon.damodya@ Narayanganj islamibankbd.com
islamibankbd.com 34 Kawran Bazar Branch* (02) 9125759 , 01711-
12 Dohar Branch (038946) 80405, 13, Kazi Nazrul Islam Avenue, 439094, E-mail: kawran@
Papel Shopping Centre, Joypara, 01730-034852 Dhaka, islamibankbd.com
Dohar, Dhaka E-mail:dohar@ 35 Khilgaon Branch 02-7216464, 01714-
islamibankbd.com 1419/2, Block-A, Khilgaon, Taltala, 015532, E-mail: khilgaon @
13 Mirpur-1 Branch (02) 8058252, Dhaka-1219 islamibank bd.com
Rabiul Plaza, Mirpur-1, Dhaka-1216, 01711-693938 36 Kishoreganj Branch 0941-62441, 0941-61675,
darussalam@islamibankbd. 1404, Mohammadi Mansion, Bara 01711-693920, E-mail:
com Bazar, Kishoreganj. kishoreganj@bttb.net.bd
14 Dhanmondi Branch (02) 9129333, 37 Konabari Branch 01755-580984
Rangs Nilu Square, 1,3,5, Sat 01730-729738, Ranu Super Market, Konabari, E-mail: konabari@
Masjhid Road, Dhanmondi dhanmondi@islamibankbd. Gazipur- 1346. islamibankbd.com
R/A,Dhaka-1209 com 38 Kotiadi Branch 01755-554479,
15 Elephant Road Branch* (02) 8626214, 01711- 2473, Kotiadi Hospital Road, E-mail: kotiadi@
Chowrangi Bhaban, 124/A, 693940 elephantroad@ Kotiadi, Kishoreganj- 2330 islamibankbd.com
Elephant Road, Dhaka-1205 islamibankbd.com 39 Lalbag Branch (02) 9615341, 01730-
16 Faridpur Branch 0631-63081,65592, 01711- Road, Apex Building, Labagh, 703856, E-mail: lalbagh@
83/1, Mujib Sarak, Faridpur 693921 Dhaka-1211. islamibankbd.com
faridpur@islamibankbd.com 40 Local Office * (02) 9552897-98, E-mail:
17 Farmgate Branch* (02) 9121114, 01711- 75, Motijheel C/A, Dhaka-1000 logb @islamibankbd.com;
Malek Tower, 31 Tejkuni Para, 693912, fex1.lo@islamibankbd.com;
Farmgate, Dhaka-1215 E-mail:farmgate@ 41 Madaripur Branch 0661-62074, 01714-040473,
islamibankbd.com Melborn Plaza, Puran Bazar, E-mail : recon.mad aripur@
18 Foreign Exchange Branch * (02) 9569413, 9565756 Madaripur-7900 islamibankbd.com
41, Dilkusha C/A.Dhaka, E-mail: fex@islamibankbd. 42 Madhabdi Branch 02-9446497, 01711-
com Madhabdi Bazar, Narsingdi 693933, E-mail: mad
19 Fulbaria Branch (09023) 73204, 01730- habdi@islamibankbd.com
Haji Ibrahim Super Market, 333624, E-mail: fulbaria@ 43 Manikganj Branch 0651-61618,01711-693926,
Fulbaria, Mymensingh. islamibankbd.com Syed Market , 60, Shaheed Rafiq E-mail: manikgonj @
20 Ganakbari Branch 01713-425966, Sarak, Manikganj. islamibankbd.com
Balivadra Bazar, Ganakbari, Dhaka, E-mail: ganakbari@ 44 Mawna Chowrasta Branch 06825-52763 , 01730-
islamibankbd.com Shahidullah Complex, Sreepur 034874, E-mail: mawna@
21 Gandaria Branch 01755-580980 Road, Gazipur. islamibankbd.com
95/5/D, Distrilary Road, (Dayaganj E-mail: gandaria@ 45 Mirpur Branch * (02) 9005650, 01711-
Chowrasta), Dhaka - 1204 islamibankbd.com House No-35/ka, Road No-1, 693911, E-mail:mirpur@
22 Gazipur Chowrasta Branch (02) 9252204, E-mail: Mirpur (Gool Chakkar), Dhaka. islamibankbd.com
Anupam Super Market, Chandana, gazipurchowrasta@ 46 Madhupur Branch 038975-88189 E-mail:
Gazipur. islamibankbd.com Pilot Super Market, Modhupur, madhupur@islamibankbd.
23 Gazipur Sadar Branch 01755 – 629468, Tangail. com
Shibbari Moor, B.I.D.C.Road E-mail: gazipursadar@
Gazipur – 1700. islamibankbd.com

Sl. Name of the Branch Phone Number & Sl. Name of the Branch Phone Number &
No. & Address E-mail Address No. & Address E-mail Address
47 Mohakhali Branch (02) 8829400, E-mail: 70 Savar Branch (02) 7745777, 01711-
Bhaban , 89, Mohakhali C/A, mohakhali@islamibankbd. B-37/1, Jaleshar, Bazar Bus Stand, 693928, E-mail: savar@
Dhaka-1212 com Savar, Dhaka islamibankbd. Com
48 Mohammadpur Krishi Market (02) 8142833, 01714- 71 Shariatpur Branch (0601) 61418, 01714-
Branch, Probal Housing, 36-37, 036080, E-mail: krishi Dubai Plaza, 241/242, Sadar Road, 041437, E-mail: shariatpur@
Ring Road, Dhaka-1207. market@islamibankbd.com Shariatpur. islamibankbd.com
49 Motijheel Branch (02) 9514980, 01713- 72 Sherpur Branch 0931-61618, 01711-
9/1, Motijheel C/A, Dhaka-1000. 164489, E-mail: motijheel @ Muslim Market, Shaheed Bulbul 693927, E-mail: sherpur@
islamibankbd.com Sarak, Sherpur islamibankbd.com
50 Mouchak Branch * (02) 9345946, 01711- 73 Shyamoli Branch* (02) 9123527, 01755-
Hosaf Twin Tower, Malibag, 693913, E-mail: mouchak @ 15/4, Mirpur Road, Shyamali, 521677, E-mail: shyamoli @
Dhaka–1217 islamibankbd.com Dhaka-1207. islamibankbd.com
51 MoghbazarBranch (02) 8317910, 01730- 74 Shyampur Branch 02- 7446699, 01714-
WAQFBhaban, 4, NewEskaton 727389, E-mail: mosbazar 227/3, Karimullarbag, Postagola, 037942, E-mail: shyampur
Road, Moghbazar,haka-1000. @islamibankbd.com Shyampur, Dhaka. @islamibankbd.com
52 Munshiganj Branch 0691-63405, 01711-693925, 75 Sreenagar Branch 06925-65350
480, Main Road E-mail: mushigonj @ Sheikh Market, Jhumur Cinema Hall E-mail: srenagar@
Munshiganj-1500 islamibankbd.com Road, Sreenagar, Munshiganj-1550 islamibankbd.com
53 Mymensingh Branch 091- 67255, 01711-693923, 76 Takerhat Branch 06623-56277, 01714-
76/A, Chotto Bazar, Mymensingh E-mail: mymensingh @ Takerhat, Rajoir, Madaripur 098019, E-mail: takerhat @
islamibankbd.com islamibankbd.com
54 Narayanganj Branch* (02) 7630400, 01711- 77 Tangail Branch 0921-54361, 55603, 01711-
79, Bangabandhu Road, 693943, E-mail: narayanganj 301-307 Par Dighulia, Tangail 693924, E-mail: tangail @
Narayanganj @islamibankbd.com islamibankbd.com
55 Narsingdi Branch* 02-9462313, 01711-693919, 78 Tarakandi Branch 01711-693947, 01730-
139, Sutapatty, Narsingdi -1600 E-mail: narsingdi @ Jamuna Shar Karkhana, 709284, E-mail: tarakandi
islamibankbd.com Tarakandi, Jamalpur. @islamibankbd.com
56 Naria Branch (0601) 59158 01755- 79 Tongi Branch 02-9813853, 01711-
Maa Complex, Girls School Road, 629469, E-mail: naria@ 19, Main Road, Tongi, Gazipur 693946, E-mail: tongi@
Naria, Shariatpur- 6025 islamibankbd.com islamibankbd.com
57 Nitaiganj Branch 01755-551142, 80 Trishal Branch 01755-554480
1, R. K. Dash Road ,Nitaiganj E-mail :nitaiganj@ Zame Masjid Road, Trishal, E-mail: trishal@
Narayanganj- 1400 islamibankbd.com Mymensingh. islamibankbd.com
58 Nawabganj Branch 06225 - 56235 01730- 81 Uttara Branch* 8920500, 01711-693936,
Nawabganj, Dhaka. 333625 E-mail: nawabgonj Kushal Centre, Dhaka-Mymensingh E-mail: uttara@
@islamibankbd.com Road, Uttara, Dhaka-1230. islamibankbd. Com
59 Nawabpur Road Branch* (02)9557258, 7126250, 82 VIP Road Branch* 9359442,01730-730169,
210-211 Nawabpur Road, Dhaka E-mail: nawabpur@ 30, V.I.P. Road, Kakrail, Dhaka E-mail: viproad@
60 Netrakona Branch (0951) 62557, 01714- 83 Wiseghat Branch 01755 – 629464
Hashem Plaza, 166, Chhotta Bazar, 038570, E-mail: netrokona@ 8/2B, Wiseghat Road, E-mail: wiseghat@
Netrakona islamibankbd.com Dhaka- 1100. islamibankbd.com
61 New Market Branch* 9667320, 01711-693910, 84 Zinzira Branch 7762452,01711-693931,
Doza Mansion , E-mail: newmarket@ Zinzira Thana Road, E-mail: zinzira@
23,Mirpur Road, Dhaka islamibankbd.com Keraniganj, Dhaka islamibankbd.com
62 Palash Branch ( 06254) 88062, 01711- 85 Amin Bazar Branch 02-9020360,
Shar Karkhana Gate, Khanepur, 693930, Email- palash@ 755, Begun Bari, Amin Bazar, E-mail: ibblamin@bttb.
Palash, Narsingdi. islamibankbd.com Dhaka. net.bd.
63 Pallabi Branch 02-8034754, 9004796,
Ahmed Food Plaza, Block-A, E-mail: pallabi@
Section-11, Pallabi, Mirpur, Dhaka. islamibankbd.com SME/Krishi Shakha
64 Paltan Branch* 7176162, 07111-622474 Sl. Name of the SME/ Phone Number &
Darus Salam Arked E-mail: paltan@ No. Krishi Shakha E-mail Address
14, Purana Paltan, Dhaka -1000 islamibankbd.com
1 Alanga SME/Krishi Shakha 01730-097280 E-mail:
65 Panthapath Branch 02-8141962, 01730-034850, Madina Shapping Complex, Alanga alanga@islamibankbd.com
Tridhara Tower, 67, Lake Circus, E-mail: panthapath @ Bus Stand, Kalihati, Tangail – 1974.
West Panthapath, Dhaka. islamibankbd.com
2 Bandura SME/Krishi Shakha 01730-097281
66 Rajbari Branch 0641-66242, 66311, 01714-
Bandura Bazar, Nawabganj, Dhaka. E-mail: sme.bandura@
77/1, Nahar Plaza, Station Road, 016407, E-mail: ibblraj@
islamibankbd.com
Rajbari-7700 bttb.net.bd
67 Ramna Branch* 9563417, 01711-693914, 3 Zirani Bazar SME/Krishi Shakha .01730-097289
Dawn Plaza, 9, Banga Bandhu Email: ramna@ R. S.Plaza, BKSP, Ashulia Dhaka. E-mail: ziranibazar@
Avenue, Dhaka islamibankbd. Com islamibankbd.com
68 Rampura Branch* 8359475,01711-431277, 4 Muktagacha SME/Krishi Shakha 09028-75160, 01713-
394, DIT Road, West Rampura, E-mail: rampura@ 81, Barha Masjid Super Market, 425923, E-mail: muktaga
Dhaka islamibank bd.com Muktagacha, Mymensingh cha@islamibankbd.com
69 Sadarghat Branch 7113194, 01711-693918 5 Kalampur SME/Krishi Shakha 01730-326102
34/A, P.K. Ray Road, E-mail: sadarghat@ Kalampur Bazar Masjid Market, E-mail: kalampur@
Bangla Bazar, Dhaka. islamibank bd.com Dhamrai, Dhaka. islamibankbd.com

Sl. Name of the SME/ Phone Number & Sl. Name of the Branch Phone Number &
No. Krishi Shakha E-mail Address No. & Address E-mail Address
6 Sonargaon SME/Krishi Shakha (06723) 56295, 01730- 17 Chauddagram Branch 01714-004855
Bhuiyan Plaza, Mugrapara, 326860, E-mail: sonargaon 216, Abdul Jalil Shopping Mall, E-mail: chauddagram@
Sonargaon, Narayanganj-1441. @islamibankbd.com Chauddagram Bazar, Comilla. islamibankbd. com
7 Bhanga SME/Krishi Shakha (06323) 56331, 01730-
18 Chawk Bazaar Branch 031-611244
Munshi Bhaban, Bhanga Bazar 706796, E-mail: bhanga@
Fayaz Mansion , 191/192 (new) 01711-889908,
Faridpur islamibankbd.com
Lalchand Road, Chawk Bazar, E-mail: chawkbazar@
8 Chormuguria SME/Krishi Shakha 01730-097285
Chittagong islamibankbd.com
Yusuf Plaza, Chormuguria Bazar E-mail: chormuguria@
19 Chiringa Branch 03422-56472, 56083,
Road, Madaripur. islamibankbd.com
Chokoria Shopping Complex, 01713-164492, E-mail:chi
Chiringa, Cox’s Bazar. ringa @islamibankbd.com
Chittagong Division 20 Chhagalnaiya Branch 03322-78478, 01713-
New Market, Chhagalnaiya, Feni 425932 E-mail: chhagal
Sl. Name of the Branch Phone Number & naiya@islamibankbd.com
No. & Address E-mail Address
21 Chowmuhani Branch * 0321-52027, 51537,01755-
1 Agrabad Branch* 031-2511382, 01711-
856, Feni Road Chowmuhani, 521311, Email : chowmuh
03, CDA, Sheikh Mujib Road., 889901, Email: agrabad @
Noakhali. ani @islamibankbd. Com
Agrabad C/A, Chittagong islamibankbd. Com
22 College Road Branch 01755-551140
2 Anderkilla Branch* 031-2852006, 01711- Gafur Plaza, 597, College Road Email : collegeroad@
G.A. Bhaban , 36-37, Nazir Ahmed 889904, E-mail: anderkilla Feni- 3900 islamibankbd.com
Chowdhury Road, Anderkilla, Chittagong @islamibankbd.com 23 Comilla Branch 081-65935, 66633, 01711
3 Ashuganj Branch 0383-4080017, 01755- B.M Thikana Tower, 77/71-78/72 -889937, E-mail: comilla@
Hajee Zahirul Haque Munshi Shopping 545514, E-mail: ashuganj @ Kandirpar, Comilla -3500. islamibankbd.com
Complex , Station Road, B. Baria islamibankbd.com 24 Companiganj Branch 08026- 59099, 01714-
Companiganj Bazar, Muradnagar, 048906, E-mail: compani
4 Bancharampur Branch 08523-56027, 01714-098018 Comilla gonj @islamibankbd.com
Bancharampur, Brahmanbaria. E-mail: Bancharampur@ 25 Kosba Branch 01755-554481
islamibankbd.com Shimanta Complex, Kosba, E-mail: kosba@
5 Bahaddarhat Branch 01755-629460 Brahmanbaria - 3460 islamibankbd.com
Manila Plaza, (3rd Floor) E-mail: bahaddarhat@ 26 Cox’s Bazar Branch 0341-63302, 01711-
3537/A, Bahaddarhat Moor, islamibankbd.com 209, Main Road, Cox’s Bazaar. 889968, E-mail: cox’s
Chandgaon, Chittagong- 4212 bazar@islamibankbd. Com
6 Bank Road Branch 0321-53251, 53509, 01714 27 Dagunbhuiyan Branch 03323-79479, 01730-
Rubi Plaza, South Bazar, -089574, E-mail: bank Ishaque Shopping Complex , 034871, E-mail: dagunbh
Chaumuhani, Noakhali. road@islamibankbd.com Dagunbhuiyan, Feni. uiyan@islamibankbd.com
7 Baraiyarhat Branch 01714-041436
28 Dewanhat Branch 031-2514082, 031-
Three Star Shopping Complex, E-mail: baraiyarhat@
Sheikh Kamal Complex, 257/A, 2514083,01713-425932
Shantirhat Road, Baraiyarhat, islamibankbd.com
D.T. Road, Dewanhat,Chittagong E-mail: dewanhat@
Mirsharai, Chittagong. islamibankbd.com
8 Bashurhat Branch 03223-56383, 01711-889951 29 Eidgah Branch 03432-58541, 01711-
Jahanara Super Market , Uttar Bazar, E-mail: bashurhat @ Hajee Shafiq Shopping Centre, 431276, E-mail: eidgaon @
Main Road, Bashurhat, Noakhali. islamibankbd. com Eidgah, Cox’s Bazaar. islamibankbd. Com
9 Bandarban Branch 01730-034872 30 Faridganj Branch 08422-64236,01714-

Kalabagan Bazaar, Faridganj, 037940, E-mail: faridgonj @
49, A,B, Central Mosque Road, E-mail: bandarban@
Chandpur. islamibankbd.com
Bandarban. islamibankbd.com
10 Bangodda Bazar Branch 01755-554482, 31 Fatikchari Branch 03022-56176, 01711-
Bangodda Bazaar, Nangalkot, E-mail: bangodda@ Amanat Market, Bibirhat, Fatikchari, 404452, E-mail: fatikchari @
Comilla- 3550. islamibankbd.com Chittagong islamibankbd.com
11 Brahmanbaria Branch 0851-59456, 01711-
32 Feni Branch 0331- 74548,E-mail: feni@
Court Road, Brahmanbaria-3400 889942, E-mail: ibblbbaria 248/249, S.S.K. Road, Feni. islamibankbd.com
@hotmail.com
12 CDA Avenue Branch (031) 651733, 2551599,
Chittagong Shopping Complex, 01711-889909, E-mail: cda 33 Gouripur Branch 08023-55491, 01714-
C.D.A.Avenue, Chittagong avenue@islami bankbd.com Shamiha Plaza, Gouripur Bazar 089573, E-mail: gouripur @
Daudkandi, Comilla. islamibankbd.com
13 Chaktai Branch 031-634453, 842433,
Mia Khan Bhaban (1st floor), 2867474, E-mail: chaktai@ 34 Hajiganj Branch 08424-75281,01711-
New Chaktai, Chow Rasta Moor, islamibankbd. com 213, Makimabad Bara Masjid 889963, E-mail: hajiganj@
Chittagong-4000. Complex, Hajiganj, Chandpur. islamibankbd.com
14 Chandpur Branch 0841-63655, 01711-889965,
35 Halishahar Branch 01755-580981 E-mail:
Mir Shopping Complex, J.M. Sen E-mail: chandpur @
Halishahar Housing Estate, Halishahar@islamibankbd.
Gupta Road,Chandpur-3600. islamibankbd. com
Chittagong- 4100 com
15 Chandraganj Branch 01755-551139
36 Hathazari Branch 031-2601437, 01755-
Chandraganj Newmarket, E-mail: chandraganj@ Md. Solaiman Building , Hathazari 545518, E-mail: ibblhat@
Laxmipur- 3708. islamibankbd.com Bazar, Chittagong. colbd.com
16 Chatkhil Branch 03222-75178, 01713- 37 Jubilee Road Branch* 031-612617, E-mail: jubileer
4829, Chatkhil Kamil Madrasha Super 335785, E-mail: chatkhil@ 200/B, Jubilee Road, Chittagong oad@islamibankbd.com
Market, Chatkhil, Noakhali- 3870. islamibankbd.com

Sl. Name of the Branch Phone Number & Sl. Name of the Branch Phone Number &
No. & Address E-mail Address No. & Address E-mail Address
38 Keranihat Branch 03036-56002, 01730- 61 Khagrachari Branch 01730-333621
Keranihat, Satkania, Chittagong. 034901, E-mail: keranihat @ Mini super Market, Bazarshahi E-mail: khagrachari@
islamibankbd.com Zame Masjid Road, Khagrachari. islamibankbd.com
39 Khatunganj Branch* 031-620744, 01711-889903, 62 O.R. Nizam Road Branch 031-2555309
82, Azim Market, Khatunganj, E-mail: khatunganj @ M.M. Tower, 1105, Asian Highway, E-mail-ornizamroad@
Chittagong. islamibankbd. Com Panchlaish, Chittagong-4000 islamibankbd.com
40 Laksham Branch 08032-51332, 51137, 63 Matlab Branch 08426-56052, 01713-
Daulatganj Bazar, Laksham, 01711-889945, E-mail: Agrani Super Market, 258792, E-mail: matlab@
Comilla. ibbllaksam@yahoo.com Matlab, Chandpur-3640 islamibankbd.com
41 Luxmipur Branch (0381) 55680, 01711- 64 Raozan Branch 01730-338558
Haji Abad Bhaban, Godown Road, 889943, E-mail: Laxmipur @ 201, Chowdhury Market, Fakirhat, E-mail: raozan@
Laxmipur. islamibankbd. Com Raozan, Chittagong- 4340. islamibankbd.com
42 Lohagara Branch 03034-56159, 01199- 65 Chandina Branch 08022-56371, 01730-
M. Rahman Market, Lohagara, 790078, E-mail: lohagara @ Haji Ali Mansion, Chandina Bazar, 338560, E-mail: chandina
Chittagong. islamibankbd.com Comilla- 3510. @islamibankbd.com
43 Maijdee Court Branch 0321-61885, 01711-431275, 66 Banshkhali Branch (03037)-56250, 01730-
Shopping Sufia Centre, Main Road, E-mail: maijdee court@ Sheikh Tower, Jaldi, Banshkhali 736026, E-mail: banshkha
Maijdee Court, Noakhali. islamibankbd. com Chittagong- 4390. li@islamibankbd.com
44 Pahartali Branch 031-752599, 750901,
Bandar Bitan Market, Customs 01711-889910, E-mail: pa
Academy-4219, Chittagong hartali@islamibankbd. com SME/Krishi Shakha
45 Bandartila Branch 031-741747, 01730- Sl. Name of the SME/ Phone Number &
2152/2348, Sharif Plaza, Airport 328874, E-mail: banda No. Krishi Shakha E-mail Address
Road, Bandar, Chittagong-4218, rtila@islamibankbd.com 1 Coatbazar SME/ Krishi Shakha (03427) 56292, 01730-
46 Nabinagar Branch 01713-141981 E-mail: na Fazlul Haque Plaza, 097284, E-mail: coatbazar@
Nabinagar, Brahmanbaria. binagar@islamibankbd.com Coatbazar,Ukhiya, Cox’s Bazar islamibankbd.com
47 Nazumeah Hat Branch (031)2571533 2 Barodarogahat SME/Krishi Shakha 01730-326103
Ali Shopping Centre, Nazumeah Hat, E-mail: nazumeahat@ Irani Vola Market, Sitakunda, E-mail: arodarogerhat@
Captai Road, Hathazari, Chittagong. islamibankbd.com Chittagong- 4310. islamibankbd.com
48 Patiya Branch 03035-56560, 01711- 3 Moheshkhali SME/ Krishi Shakha (03424) 74426 (03424)
Alam Plaza, Shaheed Abdus Sabur 889967, E-mail: patiya@ Dighi Road, Gorak Ghata Bazar E-mail:moheskhali@
Road, Patiya, Chittagong islamibankbd.com Moheshkhali, Cox's Bazar-4710 islamibankbd. com
49 Raipur Branch 03822-56477, 01714- 4 Mirerswarai SME/ Krishi Shakha 03024 – 56273, 01755-
Miajee Super Market, 842, Upazila 004857, E-mail: raipur@ Maa Tower, Mirerswarai , Chittagong 636212, E-mail: mirer
Parishad Road, Raipur, Laxmipur. islamibankbd.com -: 4320. swarai@islamibankbd.com
50 Ramganj Branch 03824-75488,01714- 5 Burichong SME/Krishi Shakha 01730-700063
Chand Super Market 037943, E-mail: ramganj @ Bhaban, M.A. Gani Road, Burichong E-mail: burichong@
Kala Bagan, Ramganj, Laxmipur islamibankbd.com Bazaar, Comilla- 3520 islamibankbd.com
51 Rangamati Branch 0351-63312, 01199- 6 Parshuram SME/Krishi Shakha 01730-341042,
Rangamati Sadar, Rangamati 792137, E-mail: rangamati Haji Kalim Uddin Plaza, 385,Thana E-mail: arshuram@
@islamibankbd.com Road, Parshuram, Feni- 3940 islamibankbd.com
52 Ramu branch (03425) 56202
7 Daudkandi SME/Krishi Shakha 01730-326100,
Bye Pass Fatekhanrkul, Ramu, E-mail: ramu@
Ahmadia Plaza, Daudkandi Bazar, E-mail: daudkandi@
Cox’s Bazar- 4730. islamibankbd.com
Comilla islamibankbd.com
53 Sandwip Branch 01714-098451, 01730-
8 Chaprashirhat SME/Krishi Shakha 01730-097283,
New Upazila Complex, Sandwip 048037, E-mail: sandwip @
Chaprashirhat New Market, E-mail: chaprashirhat@
Chittagong. islamibankbd.com
Kabirhat, Noakhali islamibankbd.com
54 Senbag Branch 03225-56014
9 Akhura SME/Krishi Shakha 08522 – 56190, 01730-
134,Bhuiyan Super Market, College 01730-034851,
Noorjahan Manjeel, Akhura-Chandura 326104, E-mail:akhura@
Road, Senbag, Noakhali
Road, Akhura, B. Baria-3450 islamibankbd.com
55 Sitakunda Branch 03028-56419, 01711-
Madrasha Market, D.T .Road, 439096, E-mail: sitakunda
Sitakunda, Chittagong-4310, @islamibankbd.com
Khulna Division
56 Sonagazi Branch 03325-76086,01714-
Main Road, Sonagazi, Feni 036536, E-mail: sonagazi @ Sl. Name of the Branch Phone Number
islamibankbd.com No. & Address E-mail Address
57 Station Road Branch* 031-615353, 01730- 1 Bagerhat Branch 0468-63127, 01711-889920,
526, Station Road, Ghosal 730168, E-mail-station Hajee Shamsuddin Plaza E-mail: bagerhat@
Quarter, Chittagong road@islamibankbd.com Kazi Nazrul Islam Road, Bagerhat. islamibankbd.com
58 Subarnachar Branch 03228-52175 2 Benapole Branch 04228-75704,01711-
Char Aman Ullah, Char Jabbar, E-mail: subarnachar@ S S Super Market, Benapole Port, 889923, E mail: benapole @
Nonkhali- 3812. islamibankbd.com Jessore. islamibankbd.com
59 Teknaf Branch 03426-75126,01819- 3 Chowgacha Branch 042244-56021,01713-
Bazar Road, Teknaf, 836573, E-mail: teknaf@ Nur Ali Mridha Market, Chowgacha, 335786, E mail: chowga
Cox’s Bazaar islamibankbd.com Jessore. cha@islamibankbd.com
60 Terry Patty Branch 01755-551141 4 Chuadanga Branch 0761-64200, 64300, 01711-
Phari Road, Chawk Bazar, E-mail: terrypotti@ Thana Road, Chuadang. 432089, Remit.chuadanga@
Comilla- 3500. islamibankbd.com islamibankbd.com

Khulna Division SME/Krishi Shakha
Sl. Name of the Branch Phone Number Phone Number &
Sl. Name of the SME/
No. & Address E-mail Address E-mail Address
No. Krishi Shakha
5 Daulatpur Branch 041-760414
271, Khan A. Sabur Road, E-mail: daulatpur@ 1 Dak Banglabazar SME/Krishi (04532) 51010
Daulatpur, Khulna islamibankbd.com Shaka E-mail: dakbangla@
Dak Bangla Bazar, Jhenaidah islamibankbd.com
6 Jessore Branch* 0421-62521
7-8, Rail Road, Jessore. E-mail: jessore@ 2 Fultala Bazar SME/Krishi Shaka . 01713-438545,
islamibankbd. com Joytun Tower, Fultala Bazar, E-mail: fultala@
Fultala, Khulna- 9210. islamibankbd.com
7 Jhenaidah Branch 0451-62757,01711-889918,
Hossain Shahid Sohrawardi Road, E-mail: ibbljhenai dah@ 3 Jibon Nagar SME/Krishi Shakha 01730-703854,
Jhenaidah. yahoo.com Jibon Nagar, E-mail: jibonnagar @
Chuadanga- 7230 islamibankbd.com
8 Jhikorgacha Branch 04225-71353, 01711-
68, Hanif Super Market 889958, E-mail: ibbljhena
Jhikorgacha, Jessore. idah@yahoo.com
9 Kalaroa Branch 04724-75357
Rajshahi Division
Haji Market, Shahid Muktijodda E-mail: kalaroa@ Sl. Name of the Branch Phone Number &
Sarak, Kalaroa Bazar, Satkhira. islamibankbd.com No. & Address E-mail Address
04725-56221, 56112, 1 Belkuchi Branch 07522-56330, 01713-
Kaliganj Branch Altaf Plaza, Mukundaganj Bazar, 141982, E-mail: belkuchi
10 E-mail: kaliganj@
Kaliganj,Satkhira, Belkuchi, Sirajganj. @islamibankbd.com
islamibankbd.com
11 Kaliganj Branch, Jhenaidah 04523-56035 2 Bogra Branch* 051-65494
Kaliganj, Jhenaidah. E-mail: kaligonj@ 801, Thana Road, Bogra. E-mail: bogra@
12 Khulna Branch* 041-730531,01711- 3 Chanchkoir Branch 07724-74038,01713-
4, Old Jessore Road, Khulna 889911,01711-807622 C.M Market, Chanchkoir Bazar, 425935, E-mail: chanch
E-mail: ibkln@bttb.net.bd Gurudashpur, Natore koir@islamibankbd.com
13 Coat Chandpur Branch 01730-333622, 01755- 4 Chapai Nawabganj Branch* 0781-61138,01711-
Kotchandpur Bazar, Jhenaidah 542876, E-mail: kotchan Munsur Mansion, 68, Bara Indara 889965, Email: ibblcng@
dpur@islamibankbd.com More, Chapai Nawabganj. bttb.net.bd
14 Kumarkhali Branch 07025-76681, 01714- 5 Dupchanchia Branch 05024-51046, 01714-
Fayez Khan Tower, Kumarkhali, 004856, E-mail: ibblkumr @ Dupchanchia New Market, 025932, E-mail: dupchan
Kushtia -7010. bttb.net.bd Dupchanchia, Bogra. chia@islamibankbd.com
15 Kushtia Branch* 071-62244, 61313 6 Highway Branch 05029-88018
Lovely Tower, 55/1, Nawab Email: kus htia@ islami Sheikh Super Market, Sherpur, E-mail: highway@
Sirajuddula Road, Kushtia. bankbd. com Bogra. islamibankbd.com
16 Magura Branch 0488-63305, 01714-025 7 Ishwardi Branch 07326-63511, 01711-
Sayed Atar Ali Road, Magura 934, 01755-636214, Station Road, Ishwardi, Pabna. 438348, E-mail: ishwardi
E-mail: ibblmgr@bttb.net.bd @islamibankbd.com
17 Meherpur Branch 0791-63112, 01714- 8 Joypurhat Branch 0571- 2962, 62862
Ripon Tower, Main Road, 082126, E-mail: ibblmehe Fouzia Market, Sadar Road, E-mail: Joypurhat@
Meherpur-7100. @bttb.net.bd Joypurhat. islamibankbd.com
18 Mongla Branch 04658-73340, 01711- 9 Kashinathpur Branch 07332-54104

1/3, Main Road, Mongla, Bagerhat 889922, E-mail: mongla@ Kashinathpur Bazar, Santhia, E-mail: Kashinathpur@
islamibankbd.com Pabna. islamibankbd.co
10 Naogaon Branch 0741-62393
19 Morrelganj Branch 04656-56107, 01714-
690, Sadar Road E-mail: naogaon @
Morrelganj, Bagerhat 016406, E-mail: morrel
Naogaon-6500 islamibankbd.com
ganj@islamibankbd.com
11 Natore Branch 0771-62630, 01711-
20 Narail Branch (0481) 62111, 01755- Al-Falah Super Market 240/241, 889932, 01713-249356
Jame-e-Masjid Market, Narail. 521677, E-mail: narail@ Rajshahi Dhaka Road, Natore E-mail: ibblnat@yahoo.com
islamibankbd.com
12 Nazipur Branch 07428-63040
21 Noapara Branch 04222-71770 Nazipur Bus Stand, Nazipur, E-mail: nazipur@
Noapara, Jessore E-mail: noapara@ Patnitola, .Naogaon. islamibankbd.com
islamibankbd.com 13 New Market Branch, Rajshahi 0721-812663
22 Paikgacha Branch 04027-56057, 01711- 219, Sultanabad, Station Road, E-mail: newmarketraj@
Kabir Plaza, Paikgacha, Khulna 432104, -mail: paikgacha Boalia, Rajshahi- 6100 islamibankbd.com
@islamibankbd.com 14 Pabna Branch* 0731-65621,66324, 01711-
23 Paradah Branch 01714-098450, 071- 50/246, Abdul Hamid Road, Trafic 889927, E-mail: pabna@
Poradah, Kushtia 65010, E-mail: poradah@ Moor, Pabna-6600 islamibankbd.com
islamibankbd.com 15 Rajshahi Branch* 0721-774767 Email :
24 Satkhira Branch 0471-63287 269, Alupotty, Ghoramara rajshahi@islamibankbd.
Bara Bazar Road, Satkhira E-mail: satkhira@ Boalia, Rajshahi-6100 com
islamibankbd. com 16 Rohanpur Branch (07823) 74246, 01713
25 Shyamnagar Branch 01755-580982, Mohazan Super Market, 438511, E-mail: rohanpur
M. M. Plaza, Nokipur E-mail: shyamnagar@ Rohanpur, Chapai Nawabganj. @islamibankbd.com
Shyamnagar, Satkhira- 9450 islamibankbd.com 17 Santhia Branch 07327-56211, 01714-
26 KDA Avenue Branch ,041-733633, 01713- Tania Super Market, Santhia 035554, E-mail: santhia@
181,Khan A. Sabur Road, Shibbari 185038, E-mail: kdaaven Bazar, Pabna. islamibankbd.com
Mour, Khulna-9310 ue@islamibankbd. com,

No. & Address E-mail Address Barisal Division
18 Sapahar Branch 01755-629461, Sl. Name of the Branch Phone Number &
Sapahar New Market, Sapahar, E-mail: shapahar@ No. & Address E-mail Address
Sapahar, Naogaon- 6560 islamibankbd.com
4 Jhalokathi Branch 0498-62716,
19 Setabganj Branch 01755-554478
14, Batasha Patty Road, Email: islamibankjkt@
Setabganj Chowrasta E-mail: setabganj@
Bochaganj, Dinajpur- 5325. islamibankbd.com Jhalokathi. yahoo.com,
5 Miarhat Branch 01713-425965,
20 Shahjadpur Branch 0751-63769 Kourikhara, Nesarabad E-mail: miarhat@
Late Abdul Hafiz Khan Market, E-mail: shahjadpur@ Pirojpur. islamibankbd.com
Shahjadpur, Sirajganj. islamibankbd.com 6 Patuakhali Branch 0441-62283
21 Shibganj Branch 07825- 75107, 01711- 29, Sadar Road, Adalat Para, E-mail: patuakhali@
Main Road, Shibganj, 438346, E-mail: shibganj Patuakhali. islamibankbd.com
Chapainawabganj- 6340. @islamibankbd.com 7 Pirojpur Branch 0461-62571,
22 Sirajganj Branch 0751-62435 Zilla Parishad Super Market, E-mail: pirojpur@
A.B.Super Market, 791,S.S.Road, E-mail: sirajganj@ Pirojpur-8500 islamibankbd.com
Sirajganj. islamibankbd.com
8 Torki Branch 01714-097886
23 Mohadevpur Branch 01730-328870, E-mail:
Kishmat Plaza, Upozila Road mohadevepur@ Masjid Market, Torki Bandar, E-mail: torki@
Mohadevpur, Naogaon- 6530 islamibankbd.com Gournadi, Barisal. islamibankbd.com
24 Baragola Branch 051-66450,01730-338559, 9 Bhandaria Branch 04623-56360,
Jamil Building, Rangpur Road E-mail: baragola @ Hawlader Market, Bhandaria, E-mail: bhandaria@
Baragola, Bogra -5800. islamibankbd.com Pirojpur- 8550. islamibankbd.com
25 Ullahpara Branch (07529) 56134 10 Charfashion Branch 01755 – 629465
Gulisthan Mour, Ullapara, E-mail: ullapara @ Taz Plaza, 250, Sadar Road E-mail: charfashion@
Sirajganj-6760 islamibankbd.com Charfashion, Bhola- 8340 islamibankbd.com
26 Baneswar Branch 01730-700064,
Baneswar Bazaar, Puthia, E-mail: baneswar@ 11 Hatkhola (0431) 2177234,
Rajshahi-6260. islamibankbd.com Chawkbazar Branch E-mail: hatkhola@
Hatkhola Road, Barisal- 8200. islamibankbd.com
SME/SME/Krishi Shakha
Sl. Name of the SME/ Phone Number & SME/Krishi Shakha
No. Krishi Shakha E-mail Address Sl. Phone Number &
Name of the SME/Krishi Shakha
1 Keshorehat SME/Krishi Shakha 01730-097287 No. E-mail Address
Eakram Plaza, Keshorehat, E-mail: keshorehat@ 1. Borhanuddin SME/Krishi 01730-326105
Rajshahi. islamibankbd.com Shakha E-mail: borhanuddin@
2 Shantahar SME/Krishi Shakha 01713-438502, 26, Raniganj Road, Borhanuddin, islamibankbd.com
Bhola- 8320
203/2M. M. Plaza, Bogra Road, E-mail: shantahar@
Shantahar, Bogra -5891. islamibankbd.com
3 Kahalu SME/Krishi Shakha 05026-56049 Sylhet Division
Alhaj Super Market, Railget E-mail: kahalu@
Charmatha, Kahalu, Bogra. islamibankbd.com Sl. Name of the Branch Phone Number &
4 Nandigram SME/Krishi Shakha (05027) 76085 No. & Address E-mail Address
Bogra- Nator Road E-mail: nandigram@ 1 Amberkhana Branch 0821-712102, 01711-
Nandigram, Bogra- 5860. islamibankbd.com Century Shopping 889938, E-mail: amberk
5 Sujanagar SME/Krishi Shakha 01713-015450 Centre, Amberkhana, Sylhet hana@ islamibankbd.com
41/B, College Road E-mail: sujanagar@
2 Barolekha Branch 08622-56492, 01713-
Sujanagar, Pabna-6660. islamibankbd.com
Haji Abdul Ali Trade Centre, 425931, E-mail: barolekha
6 Mohastangarh SME/Krishi 01730-097286, Barolekha, Moulvi Bazar. @islamibankbd.com
Shakha E-mail:mohastangor @
Mohastangarh, Shibgonj, Bogra. islamibankbd.com 3 Beani Bazar Branch 03799-288658
Haji Nuruddin Mansion, Main Road, E-mail: beanibazar @
South Beani Bazar, Sylhet. islamibankbd.com
Biswanath Branch
Barisal Division 4
Puran Bazar, Biswanath , Sylhet.
038911-82105,
E-mail: biswanath@
Sl. Name of the Branch Phone Number & islamibankbd.com
No. & Address E-mail Address 5 Chatak Branch 01711-432105,
1 Barguna Branch 0448-62088, Bagbari, Chhatak, E-mail: chhatak@
9, Nazrul Islam Sarak 01714-009230 Sunamganj. islamibankbd.com
Barguna Email: ibblbrg@bttb.net.bd. 6 Goala Bazar Branch 08242-56720,
2 Barisal Branch 0431-64524 Goalabazar, Balaganj, Sleet E-mail: Goalabazar@
132/121, Sajrini Super Market, E-mail: barisal@ islamibankbd.com
East Bogra Road, Barisal-8200. islamibankbd.com
7 Habiganj Branch 0831-52611, 01711-
3 Bhola Branch 0491-62774, 01711-
Kalibari Road, Habiganj 889949, E-mail: habiganj
Kornophuly Complex, 889919, E-mail: bhola@
@islamibankbd.com
3373, Sadar Road, Bhola, islamibankbd.com
8 Jagannathpur Branch 08727-56010,01713-
4 Jhalokathi Branch 0498-62716, Al-Jannath Plaza, Jagannathpur, 335778, E-mail: jagannat
14, Batasha Patty Road, Email: islamibankjkt@ Sunamganj. hpur@islamibankbd.com
Jhalokathi. yahoo.com,

Sylhet Division No. & Address E-mail Address
Sl. Name of the Branch Phone Number & 4 Dhap Branch 01755-580983
No. & Address E-mail Address Almi Bari, 30 Jail Road E-mail: dhap@
Rangpur- 5400 islamibankbd.com
9 Kanaighat Branch 08233-56062, 01714-
5 Gaibandha Branch 0541-61722
Kanaighat Bazar, Kanaighat, 048905, E-mail: kanaighat
Parkview Super Market, E-mail: gaibandha @
Sylhet. @islamibankbd.com
Gaibandha-5700 islamibankbd.com
10 Kulaura Branch (08624) 56634, 56289, 6 Gobindaganj Branch 01711-889957, 01713
S.A. Shopping Centre, Dakshin E-mail: kulaura@ Zahir Complex, Biswa Road, 41507, E-mail: gobinda
Bazar, Kulaura, Moulvi Bazar. islamibankbd.com Gobindaganj, Gaibandha ganj@islamibankbd.com
11 Laldighirpar Branch 0821-714436 7 Jaldhaka Branch 05524-64046, 01714
Al- Karim Plaza, Laldighirpar, E-mail:laldighirpar@ Dalia Road, Jaldhaka 037946, E-mail: jhaldhaka
Sylhet. islamibankbd.com Nilphamari @islamibankbd.com
12 Moulvi Bazar Branch 0861-62830, 52680, 8 Kurigram Branch 0581-61722, 01711
67,Central Road, E-mail: moulvibazar@ 16,Bazar Road, 435012, E-mail: ibblkuri@
Moulvi Bazaar. islamibankbd.com Kurigram. yahoo.com
9 Lalmonirhat Branch 0591-61006, 01714-040449,
13 Sreemangal Branch 08626- 88224, 08626-
Mogolhat Gate, Puran Bazar, E-mail: lalmonirhat @
Sreemangal, Sreemangal, 71120, E-mail: sreemangal
Lalmonirhat islamibankbd.com
Moulvi Bazar-3210. @islamibankbd.com 10 Nilphamari Branch 0551-61619, 01711-
14 Sylhet Branch* 716282, 01711-889939 Upon the Butterfly Show Room, 438345, 01713-164487,
288, Taltola, Sleet. E-mail: sylhet@ Hazi Mohsin Road E-mail: nilphamari@
islamibankbd. Com Nilphamari islamibankbd.com
15 Sunamganj Branch 01730-034873 11 Panchagarh Branch 0568-61890, 01714-016298,
Ahsan Mansion, Station Road, E-mail: sunamganj@ Panchagarh Central Mosque E-mail: panchagarh @
Sunamganj. islamibankbd.com Market, Tetulia Road, anchagarh. islamibankbd.com
16 Zindabazar Branch 01730-328872, 12 Rangpur Branch 0521-63576, 66003,
Jallarpar Road, Zindabazar, E-mail: zindabazar@ Motahar Commercial Complex, 01711-438343, E-mail:
Sylhet-3100 islamibankbd.com G. L. Ray Road, Rangpur. rangpur@islamibankbd.com
13 Saidpur Branch* 05526-73122, 01711-
17 Dakshin Surma Branch 01730-703853, (0821)
Dinajpur Road, Saidpur, 438340, E-mail: saidpur@
779, Humayun Rashid Chattar, 841909, E-mail:
Nilphamari . islamibankbd.com
Kotwali, Sylhet-3100. southsurma@islamibankbd.
14 Sundarganj Branch 05427-64216, 01730
com
Janata Market, 116, College Road, 333623, E-mail: sundarganj
Sundargonj, Gaibandha. @islamibankbd.com
SME/Krishi Shakha 15 Thakurgaon Branch 0561-53467, 01711-
Masjid Market, Chowrasta, 814535, E-mail: thakurgaon
Sl. Phone Number & E-mail
Name of the SME/Krishi Shakha Thakurgaon. @islamibankbd.com
No. Address
1 Shayestagonj SME/Krishi 08332-56800, 01730-
Shakha 097288, E-mail: shayesta SME/Krishi Shakha
Shayestagonj, Hobigonj. gonj@islamibankbd.com
Sl. Phone Number &
2 Nabiganj SME/Krishi Shakha 01730-736025, (08328) Name of the SME/Krishi Shakha
No. E-mail Address
Sherpur Road, Nabigonj, 56121, E-mail: nabiganj @ 1 Patrgram SME/Krishi Shakha 01730-703851
Hoboganj. islami bankbd.com Asir plazam, Main Road, Patgram, E-mail: patgram@
lalmonirhat 5540, islamibankbd.com
Rangpur Division * Authorized dealer in Foreign Exchange.

No. & Address E-mail Address
1 Birampur Branch 05322-56540, 01714-
Main Road, Birampur 013395; E-mail: ibblbirm @
Dinajpur bttb.net.bd
2 Bhurungamari Branch 01755 – 629467;
Kashem Market, Bazar Road, E-mail: bhurungamari@
Bhurungamari, Kurigram- 5670 islamibankbd.com
3 Dinajpur Branch* 01714-093951, 01755
Hasna plaza, Station Road 545515, E-mail: dinajpur @
Dinajpur-5200 islamibankbd.com

Notice of 30th Annual General Meeting
Notice is hereby given that the 30th Annual General Meeting of Islami Bank Bangladesh Limited will be held on
Wednesday, the 22nd May, 2013 at 10.00 AM at Bangabandhu International Conference Centre (BICC), Agargaon,
Sher-e-Bangla Nagar, Dhaka for transacting the following business:
Agenda
01. To approve the minutes of the 29 Annual General Meeting held on 15th May 2012.
th
02. To receive, consider and adopt the Audited Financial Statements for the year that ended on 31st December
2012 and Reports of the Directors and Auditors thereon.
03. To approve Dividend for the year that ended on 31st December 2012.
04. To appoint Auditor(s) and to fix up their remunerations for the year 2013.
05. To elect Directors.
06. To approve appointment of Independent Directors.
All the honourable Shareholders of the Bank are requested to kindly make it convenient to attend the Meeting in time.
By order of the Board of Directors
Dated: Dhaka (Abu Reza Md. Yeahia)

20th April, 2013 Company Secretary
--------------------------------------------------------------------------------------------------------------------------------------------------------
Notes:
a) Record date is 11/04/2013 i.e. the shareholders whose names will appear in the CDS (Central Depository System)
/ Company’s Register on 11/04/2013 will be entitled to get dividend for the Year 2012 against their shareholdings.
b) A member eligible for attending and voting at the Annual General Meeting may appoint a proxy on his / her behalf.
c) Power of Attorney / Proxy forms must be submitted to the Registered Office or Share Department (63 Dilkusha C/A,
5th Floor, Dhaka) of the Company at least 48 (Forty Eight) hours before the Meeting i.e. 10.00 AM on Monday, the
20th May, 2013. Revenue Stamp of Tk.20/- (Taka Twenty) only shall have to be affixed on the proxy form.
d) The last date for submitting nomination papers at the registered office for election of Directors is 15th May, 2013,
Wednesday up to 10.00 AM and Last date of withdrawal of nomination paper is 18th May, 2013, Saturday up to
12.00 noon. Scrutiny of nomination papers will be completed on the same day by 5.00 PM.
e) List of the valid candidates for election of Directors will be hung in the Notice Board at the Registered Office on
18th May, 2013 in the afternoon.
f) Election procedures and rules thereto will be available at the Registered Office of the Company / Meeting place.
g) Annual Report, Attendance Slip and Proxy Form along with the notice will be sent to the honourable shareholders
by post / courier. The honourable shareholders may also collect Proxy Forms etc. from the Share Department of
the Company.
h) Directors’ Report and Audited Financial Statements of the Bank for the year ended 31st December 2012
together with the Auditors’ Report thereon shall be available on Bank’s website (www.islamibankbd.com) from
01/05/2013 onward.
i) Entry is reserved only for the honourable Shareholders and Proxies / Attorneys. Attendance slip (duly signed) must be
submitted to the Registration Counter at the time of entrance. Registration Counter shall remain open till 11.00 AM.
---------

Design and Concept
Design and Concept: Ar. Md. Tareq Haider, IDEA

Cover Design: Ar. Moushumi Ahmed, IDEA
Design Assistance: Md. Nahid uz Zaman, IDEA
Email: idea@enstudio.org
Printed by:

PROXY FORM
I/We ------------------------------------------------------------------------------------------------------------------ being a member(s) of
lslami Bank Bangladesh Limited do hereby appoint Jaban------------------------------------------------ of ------------------------
------------------------------------------------------------------- as my/our Proxy to attended and vote on behalf of me/us at the 30th
Annual General Meeting of the Company to be held on Wednesday, the 22nd May 2013 at 10.00 AM at Bangabandhu
International Conference Centre (BICC), Agargaon, Sher-e-Bangla Nagar, Dhaka and any adjourment thereof.
As witness my/our hand this --------------------------------- day of ------------------------- 2013.
Folio No.: ------------------------- BO A/C No.:
Tk. 20.00
(twenty) only
-------------------------------------------- ---------------------------------- -------------------------- --------------------------------------------------
Signature of the Proxy with date No. of Share(s) Revenue Stamp Signature of the Shareholder with date
N.B.: This Form of Proxy, duly signed (as recorded with the bank), stamped and completed must be submitted to the Registered Office
or Share Department (63 Dilkusha C/A, 5th Floor, Dhaka) of the Company at least 48 (Forty Eight) hours before the Meeting.
------------------------------------------------------------------------------------------------------------------------------
The 30th Annual General Meeting dated on Wednesday the 22nd May, 2013
ATTENDANCE SLIP
I do hereby submit the Attendance slip in connection with the 30th Annual General Meeting of Islami Bank Bangladesh
Limited held today Wednesday, the 22nd May, 2013 at Dhaka .
Name of the Shareholder : ----------------------------------------- Signature of the Shareholder: ----------------------
Folio No.: ----------------------- BO A/C No.:
No. of Share(s)
Name of the Attorney/ Proxy: ------------------------------------------ Signature of the Attorney/Proxy:-------------------
N.B.: The honourable Shareholders are requested to handover the Attendance Slip at the entrance of the Meeting Hall.


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2 Annual Report 2012

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4 Annual Report 2012

Standard Disclosure Index 6 Directors Report

Products and Services 37 Financial Statements

Annual Report 2012 5

Disclosure Checklist to the Key Sections of the Annual Report 2012

Items Ref. Page No.

Corporate Objectives, Values & Structure

Clarity and Presentation:

• Vision and Mission 13-14

• Overall strategic objectives 15

• Core values and code of conduct/ethical principles 16-17, 85

• Profile of the company 18-19, 75-78

Management Report / Commentary and Analysis including Director’s Report / Chairman’s

• A general review of the performance of the company 112-133, 57-70,

• Description of the performance of the various activities/products/segments of the company

• A general review of the future prospects/outlook 12, 70, 165-166

• Social responsibility initiatives (CSR) 60, 66, 70, 177-191

• Environment related initiatives 59, 66, 91, 107-111,

Appropriateness of Disclosure of Accounting Policies and General Disclosure

• Any specific accounting policies 213-217

• Impairment of Assets 220

• Changes in accounting policies/changes in accounting estimates 215

6 Annual Report 2012

• Segment revenue 48, 271

• Segment results 48, 271

Annual Report 2012 7

• Return on Shareholders Fund 50

Horizontal/Vertical Analysis including following

Operating Performance (Income Statement)

• Profit before Tax

• Profit after Tax

Statement of Financial Position (Balance Sheet)

• Property, Plant & Equipment

• Net Current Assets

• Long Term Liabilities/Current liabilities

Profitability/Dividends/Performance and Liquidity Ratios

• Gross Profit Ratio

• Earning before Profit, Depreciation and Tax

• Price earning ratio

• Return of Capital Employed

• Debt Equity Ratio

Statement of Value Added and Its Distribution

• Market share information of Company’s product/services

• Economic value added

• Sustainability Development Reporting 177-191

• Human Resource Accounting 88-90

Specific Areas for Banking Sector

8 Annual Report 2012

Disclosure for non-performing assets

• Details of accounts restructured as per regulatory guidelines

Maturity pattern of key Assets and Liabilities (ALM) 211, 235-249

Classification and valuation of investments as per regulatory guidelines/Accounting Standards 235-242

• Statutory Liquidity Reserve (Ratio) 234

• Net interest income as a percentage of working funds/operating cost – Efficiency ratio 55

• Return on Average Asset 55

• Net Asset Value per Share 53, 55

• Profit per employee 89

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