Directors' Review

The Directors are pleased to present the Financial Statements of the Bank, reviewed by the auditors for the hall year ended December 31, 2003.

The pre-tax profit for the period is Rs, 86.9 million against Rs. 72,4 million for the corresponding period last year. The performance was influenced by continuing decline in the mark-up rates and frequent corrections in the equity market. The Bank was required to sustain its credit portfolio in an increasingly competitive environment II met the challenge by recording a significant increase in the fee-based income which went up to Rs. 32.3 million from Rs. 18.8 million. Further, the borrowing cost has come down compensating   for the decline in   income from   the credit portfolio and investments.

The economic landscape is getting brighter. The growth in the capital market, low interest rates and excess liquidity combined with other favourable economic indicators present larger opportunities which the management is trying to make the most of. The equity brokerage division being established is an evidence of it.

The prevailing political and economic environment augurs well for the growth in the business and profits of the Bank in the times ahead.

Karachi                                                                                                              On behalf of the board

February 23, 2004

                                                                                                                                   NAIM FAROOQUI

                                                                                                                                    Chief Executive