4.32.4
Contents
Chairman’s statement to the shareholders
1
FIMBank group performance 2025
2
Directors’ report
6
Statement of compliance with the principles of good corporate governance
17
Remuneration report
28
Financial statements:
Statements of financial position
47
Statements of profit or loss
49
Statements of other comprehensive income
50
Statements of changes in equity
51
Statements of cash flows
55
Notes to the financial statements
57
Statement by the directors pursuant to capital markets rule 5.68
198
Schedules to the annual report
Statements of profit or loss – 5 year summary
199
Statements of financial position – 5 year summary
200
Cash flow statements – 5 year summary
201
Accounting ratios – 5 year summary
202
Directors and executive management
203
FIMBank Group Annual Report & Financial Statements 2025
1
Chairman’s statement to the shareholders
Dear Shareholder,
In presenting this year’s message to our Shareholders, I wish to reflect on the developments that shaped FIMBank Group in 2025, outlining the
progress achieved, the challenges navigated, and the strategic direction guiding the organisation through a pivotal year for the Group. The global
environment remained volatile, marked by renewed inflationary pressures, fluctuating interest rate expectations, rising trade tensions, and
persistent geopolitical instability. Despite these headwinds, the Group continued to demonstrate resilience, strengthening its operational
foundations and maintaining financial stability during a period of change.
For the year ending 31 December 2025, the Group reported a pre-tax profit of USD2.2 million from continuing operations, compared with USD4.5
million in 2024. After accounting for taxation and discontinued operations, the Group recorded a net profit of USD181,378 (2024: USD149,989).
Although the outcome was modest in absolute terms, this result reflects the Group’s ability to remain profitable in a challenging operating landscape.
At the same time, it underscores the need to accelerate efforts to enhance revenue generation, improve capital utilisation, and deliver sustainable
long-term value to our Shareholders.
The Group’s performance was materially influenced by the USD5.8 million downward valuation of the Sustainable Investment Fund held by the
Bank. Although this investment sits outside our core business activities, the valuation movement had a direct impact on the year’s reported results.
This was particularly disappointing given the solid operational progress achieved across the Group, including further strengthening of asset quality,
disciplined cost management, and improved liquidity utilisation. Improvements in liquidity management also contributed to a stronger net interest
margin towards year-end, reflecting the positive impact of the Group’s proactive balance sheet measures. Efforts to diversify the deposit base
continued to strengthen funding stability and reduce reliance on concentrated sources of funding.
A major strategic development during the year was the announcement on 30 October 2025 of Jordan Kuwait Bank’s (“JKB”) intention to acquire the
combined 88.89% shareholding currently held by United Gulf Holding Company B.S.C. and Burgan Bank K.P.S.C. This proposed transaction represents
an important milestone for both institutions. This strategic move is part of JKB’s long-term growth strategy to expand geographically and strengthen
its international presence by consolidating presence in the European market. The acquisition aims to diversify income sources and reinforce the
JKB’s financial position across global markets. For FIMBank, the contemplated acquisition offers the prospect of long-term stability, renewed
strategic direction, and deeper integration within a regionally connected banking group. Completion of the transaction remains subject to regulatory
approval from the authorities in Jordan and Malta, including the Central Bank of Jordan, the Malta Financial Services Authority, and the European
Central Bank. The Bank continues to support this process and will provide further updates in due course.
I would like to express my sincere appreciation to our majority Shareholder, KIPCO Group, for their continued support and confidence throughout
this period of transition. Their commitment has been instrumental as the Group advances its transformation agenda and strengthens its strategic
positioning. Jordan Kuwait Bank is also part of the wider KIPCO Group, and subject to the required regulatory approvals, FIMBank would remain
within the same broader Group structure. This continuity provides a stable foundation for the next phase of the Bank’s development. I also extend
my gratitude to the Board of Directors, Management, and all employees for their dedication, professionalism, and unwavering commitment to the
Bank’s continued success.
Under the leadership of Group Chief Executive Officer, Mr. Simon Jethro Lay, the Group continued to refine its operating model, enhance efficiencies,
and reinforce financial discipline. Mr. Lay’s extensive experience in trade finance and risk management, coupled with his deep institutional
knowledge, has been central to driving the Group’s strategic priorities. His leadership continues to guide the organisation through a period of
strategic change, ensuring that we remain focused on sustainable growth and operational excellence.
Looking ahead, the global outlook for 2026 remains uncertain, with expectations of moderate economic growth tempered by geopolitical risks and
evolving monetary policy conditions. As we enter the new year, our priorities remain clear: strengthening core revenue streams, optimising capital
deployment, enhancing operational efficiency, and advancing our digital transformation initiatives. These efforts will support a more agile and
resilient organisation, better positioned to capture opportunities and deliver long-term value.
While challenges persist, I am confident that the foundations laid in recent years have positioned the Group for continued progress. Our commitment
to transparency, accountability, and disciplined execution remains unwavering. Together with the support of our Shareholders, clients, partners,
and employees, we will continue to build a stronger, more resilient FIMBank Group.
Signed by Dr. John C. Grech (Chairman) on 26 March 2026
FIMBank Group Annual Report & Financial Statements 2025
2
FIMBank group performance 2025
CEO’s message
As we review the financial year ending 31 December 2025, our results reflect both the challenges of the external environment and the progress
achieved across the Group. I recognise that our Shareholders rightly expect stronger financial performance, and this remains a central focus of our
strategy. At the same time, the year demonstrated the resilience of our core business and the momentum building across key operational areas,
positioning the Group for long-term stability and growth.
The Group reported a pre-tax profit of USD2.2 million from continuing operations, compared with USD4.5 million in 2024. After accounting for
taxation and discontinued operations, the Group recorded a net profit of USD181,378 (2024: USD149,989). Although modest, this result reflects our
ability to sustain profitability in a challenging global environment and underscores the effectiveness of our strategic initiatives.
The year’s performance was significantly impacted by the USD5.8 million downward valuation of the Sustainable Investment Fund held by the parent
company. While this investment is not part of our core business, the valuation drop had a material effect on the Group’s reported results. Excluding
this non-core impact, the underlying operational performance across the Group remained stable, supported by disciplined risk management,
improved liquidity utilisation, and continued progress in operational efficiency.
With a long-standing career in the FIMBank Group since 2003 and close involvement in its development over the years, I have gained a deep
understanding of the organisation and its operations. Since assuming the role of Group Chief Executive Officer in August 2024, I have remained fully
aware of the work that lies ahead. The transformation journey we embarked upon is ongoing, and while the reported figures do not yet fully reflect
the improvements underway, the advancements achieved in risk management, operational efficiency, and business stability provide a stronger
foundation for the future. These efforts are expected to support greater resilience and improved financial outcomes in the years ahead.
A defining development during the year was the announcement by Jordan Kuwait Bank (“JKB”) of its intention to acquire the combined 88.89%
shareholding currently held by United Gulf Holding Company B.S.C. and Burgan Bank K.P.S.C. Beyond the transaction itself, this development
represents a transformative opportunity for the Group. It has the potential to usher in a new phase of strategic alignment, enhanced regional
connectivity, and strengthened capital support, enabling FIMBank to accelerate its growth ambitions and reinforce its position within its core
markets.
While completion remains subject to regulatory approvals from the relevant authorities in Jordan and Malta, including the Central Bank of Jordan,
the Malta Financial Services Authority, and the European Central Bank, we view this process not merely as a change in ownership but as a catalyst
for renewal. Management remains fully engaged in supporting the transaction and in preparing the organisation to capture the long-term
opportunities it may present, fostering innovation, deepening client relationships, and building a more resilient and forward-looking institution.
For the fifth consecutive year, the Group recorded no new material non-performing exposures, a milestone that underscores the effectiveness of
our disciplined underwriting standards, prudent risk governance framework, diversified portfolios, and robust recovery processes. Asset quality
remains one of the Group’s most significant achievements and a clear validation of the transformation undertaken in recent years. The continued
strengthening of our credit frameworks, together with sustained recoveries from legacy exposures and decisive action on fully provisioned accounts,
has reinforced the resilience of our balance sheet and enhanced the Group’s overall financial stability.
Building on this progress, the Non-Performing Loan Ratio improved further to 1.90% (December 2024: 2.85%), positioning the Group significantly
below the EU average and reflecting the sustained strengthening of our balance sheet. Recoveries from legacy non-performing clients continued
during the year, further enhancing our asset quality, capital efficiency, and regulatory standing.
Having been part of the Group for many years, I have witnessed first-hand the evolution of our franchise and the depth of trade finance expertise
embedded across our organisation. Trade finance remains at the very core of our identity and competitive strength, built on specialised knowledge,
disciplined risk management, and enduring client relationships across international markets.
In an increasingly complex global environment, our focus remains firmly on reinforcing and enhancing this core franchise, ensuring that our business
model is resilient, scalable, and responsive to the changing needs of global commerce. With the continued support of our Shareholders, we are well
positioned not only to safeguard our legacy in trade finance but to advance it further, strengthening our capabilities and delivering sustainable long-
term value within the global banking landscape.
FIMBank Group Annual Report & Financial Statements 2025
3
Overview of financial results
The Group’s financial performance in 2025 was shaped by stable operating income, disciplined cost management, and continued improvements in
asset quality. Net interest and fee income remained resilient, supported by stronger pricing discipline, improved capital utilisation, and proactive
balance sheet management. Operating expenses were well contained despite adverse exchange rate movements and ongoing investments in
technology and data transformation. Net impairment losses remained low, reflecting the Group’s strengthened credit frameworks and sustained
derisking efforts.
The Group maintained a robust capital and liquidity position, ending the year with a Total Capital Ratio of 19.3%, comfortably above regulatory
requirements. Liquidity remained strong throughout the year, supported by an average Liquidity Coverage Ratio of 223% and an average Net Stable
Funding Ratio of 153%. These indicators reflect the Group’s disciplined balance sheet management and its commitment to maintaining financial
stability and operational resilience in a demanding economic environment.
Fitch Ratings’ upgrade of FIMBank’s Long Term Issuer Default Rating to ‘B+’ with a Stable Outlook provided a meaningful endorsement of our
transformation journey and reflects the progress achieved in strengthening the Group’s financial and operational foundations.
Business unit performance
Trade Finance
Trade Finance remained a core focus for the Group, maintaining a stable client base while selectively expanding in key markets. The Bank continued
to streamline processes and remained focused on improving service delivery and operational efficiency. With a dedicated focus on supporting
clients, operations were optimised to ensure faster processing times, better client engagement, and improved transaction execution. The Malta
Head Office and Dubai DIFC Branch played a pivotal role in servicing trade finance clients, leveraging their strategic locations to provide tailored
solutions, strengthen relationships, and enhance responsiveness in key markets.
FIMBank remains a recognised name in the international trade finance market, with a strong reputation built on expertise and reliability. We aim to
leverage this standing by positioning ourselves as specialists with deep knowledge of complex trade transactions and global trade flows, ensuring
we continue to provide tailored solutions that meet the evolving needs of our clients.
Real Estate Finance
The Real Estate Finance unit continued to support residential and commercial development projects in Malta, maintaining a stable and well
performing portfolio. Adopting a selective approach, the Bank prioritised quality projects and nurtured long-term relationships with clients it has
supported since inception. This strategy reinforced our position as a trusted partner in the real estate sector, ensuring steady growth through repeat
business and carefully managed risk. The team continued to broaden its portfolio within defined risk parameters and further strengthen its specialist
expertise, ensuring that the unit remains well placed to support sound, well-structured real estate initiatives in the local market.
Retail and Corporate Banking
The Bank strengthened its local presence through the creation of a new Retail and Corporate Banking unit, which brings together two previously
separate business areas. This development enhances client coverage and supports a more efficient delivery of services. Throughout 2025, the unit
expanded its client base, onboarding established Maltese corporates across several industries and providing working capital facilities, general
banking services, and revolving credit solutions. This progress reflects the growing relevance of the Bank’s offering in the domestic market and
positions the unit to gradually expand its role while diversifying its portfolio in a disciplined manner.
FIMBank Group Annual Report & Financial Statements 2025
4
London Forfaiting Company Ltd (“LFC”)
LFC operated in a challenging economic environment marked by lower interest rates, abundant liquidity in the trade finance market, rising trade
tariffs, and continued geopolitical uncertainty. Despite these pressures, the company reported a post-tax profit of USD4.6 million, demonstrating
resilience and disciplined portfolio management. Realised and unrealised trading gains totalled USD0.5 million, an improvement over the previous
year. Operating expenses remained well controlled, and funding diversification advanced significantly, supported by new external credit lines and
Eurobond issuances.
LFC expanded its business activity during the year, increasing the trading portfolio from USD274.7 million at year-end 2024 to USD445 million at
year-end 2025. The portfolio remained short-term in nature, providing a strong platform for income generation in 2026 despite the challenging
backdrop. Beyond its financial contribution, LFC continues to play a critical role in the Group’s strategy by broadening its international reach,
strengthening its trade finance capabilities, and supporting the Bank’s overall risk adjusted returns. Its ability to adjust its portfolio swiftly and
effectively in response to market shifts remains an important asset for the Group.
India Factoring and Finance Solutions Private Ltd (“India Factoring”)
India Factoring delivered a strong performance in 2025. Operating income reached USD7.5 million, an increase of 3.7% over the previous year. The
entity reported a post-tax profit of USD1.0 million, supported by stable portfolio performance, improved recoveries, and disciplined cost
management. The balance sheet strengthened further, with funds in use rising by 17% year-on-year, driven primarily by export related business.
Customer concentration improved, credit quality remained robust, and funding diversification advanced meaningfully.
Operationally, the company maintained its strong position in the Indian export factoring market and continued to be recognised among the global
leading players. Its improved credit rating is expected to facilitate access to additional local funding and support future growth. The company’s
achievements during the year were also reflected in the industry recognition it received, underscoring its strong market presence and continued
progress in the Indian factoring landscape. These acknowledgements highlight its commitment to service quality and effective market engagement,
reinforcing its role as a trusted financial partner for businesses in India. With a solid track record in factoring and trade finance, the entity remains
well placed to broaden its market reach and further enhance its offering while maintaining a disciplined approach to credit and portfolio
management.
The Egyptian Company for Factoring S.A.E. (“Egypt Factors”)
Egypt Factors has established itself as a key provider of factoring services in Egypt, recognised for its early role in developing the local market and
for supporting businesses with reliable working capital solutions. The company continued to offer high quality accounts receivable and reverse
factoring services, helping clients optimise cash flow and manage supplier obligations more efficiently.
Egypt Factors delivered a solid operational performance in 2025; however, results were affected by higher Stage 3 provisions. Net fee and
commission income increased by 6.5%, and operating expenses remained well controlled. The factoring portfolio grew by 11.6%, demonstrating the
company’s success in broadening its customer base and enhancing service quality. The entity also secured external funding from several local banks,
further strengthening its financial position.
In line with the Group’s strategic decision to focus on core business and release capital and operational resources, Egypt Factors was classified as
held for sale in 2025. Accordingly, its results are presented as “Profit from discontinued operations”.
Our people
At FIMBank, we know that the foundation of our success rests with our people. The dedication and commitment of our employees drive the Bank’s
ability to deliver high-quality, dynamic, and innovative financial services. Employees gain unique exposure to international trade and banking,
broadening their horizons and developing a global perspective that sets them apart in the industry. We remain committed to fostering a work
environment that supports professional growth, collaboration, and engagement, equipping our employees with the skills and experiences necessary
to thrive in an increasingly interconnected financial landscape.
Environmental, social and governance (ESG) commitment
FIMBank recognises the importance of ESG principles and their growing role in the financial sector. The Group continues to work with external
specialists to implement an ESG framework aligned with the European Union’s ESG objectives. As the ESG landscape evolves, we will continue to
assess and refine our strategy in response to regulatory and market expectations.
FIMBank Group Annual Report & Financial Statements 2025
5
Corporate social responsibility
FIMBank remained actively engaged in cultural, environmental, and philanthropic initiatives throughout 2025. The Bank continued to support local
NGOs, cultural events, and community programmes, reinforcing its role as a responsible corporate citizen committed to fostering positive social
impact.
During 2025, the Bank supported a number of initiatives led by organisations making meaningful contributions to society. As part of our commitment
to health and wellbeing, employee led initiatives supported the Pink October and Movember campaigns, and the Bank complemented these efforts
with a financial donation to Hospice Malta. The Bank also contributed to Puttinu Cares, a charity that provides practical, emotional, and
accommodation support to cancer patients and their families during treatment.
In the cultural and environmental sphere, FIMBank supported Din l Art Ħelwa during its 60th anniversary celebrations, recognising the organisation’s
longstanding work in safeguarding Malta’s cultural, architectural, and natural heritage. These initiatives reflect our ongoing commitment to
supporting the communities in which we operate and contributing to the preservation of Malta’s heritage.
Technology and digital advancements
FIMBank remains committed to enhancing its digital banking infrastructure. In 2025, the Bank successfully launched Incoming Euro Instant
Payments, enabling incoming Euro transactions to be processed in under 10 seconds, 24/7. This development significantly strengthens the Bank’s
offering by improving cash flow efficiency for businesses and providing individuals with immediate access to their funds.
Alongside this, the Bank continued to upgrade and implement new platforms across various business units, leveraging technology to enhance
efficiency and support strategic growth objectives. As part of this broader digital agenda, the Bank is also assessing the use of artificial intelligence
as an enabler to improve internal processes, strengthen risk management, and enhance client service. These initiatives are focused on
complementing existing capabilities rather than replacing them, ensuring that technology supports the Bank’s people and operations in a responsible
and effective manner.
Our focus for 2026
In 2026, the Group’s priorities will centre on strengthening the foundations laid in recent years and accelerating the initiatives that support long-
term performance. Revenue diversification will remain a key focus, supported by disciplined asset growth and a continued emphasis on improving
the quality and resilience of our portfolios. We will also intensify efforts to enhance operational efficiency, ensuring that our processes, systems,
and organisational structures are aligned with the needs of a more agile and scalable business model.
At the same time, we will continue to advance our digital transformation agenda, investing in technology that enhances client experience,
strengthens risk management, and supports data driven decision making across the organisation. Strengthening our risk management frameworks,
deepening collaboration across business units, and optimising capital deployment will remain central to our strategy, enabling the Group to operate
with greater clarity, discipline, and strategic focus. These priorities are designed to reinforce the Group’s long-term resilience, support sustainable
growth, and position FIMBank to capture opportunities that align with our strategic direction and core strengths.
Concluding remarks
The progress achieved in 2025 reflects the hard work, determination, and disciplined execution demonstrated across the Group. We recognise both
our strengths and the challenges that remain. The transformation efforts of recent years are taking hold, reinforcing the foundations on which we
continue to build a stronger institution. We are deeply grateful for the steadfast support of our Shareholders, their confidence strengthens our
resolve to enhance long-term value and remain focused on our strategic priorities.
As we look ahead to 2026, our attention remains on strengthening our operational framework, improving efficiency, and advancing the initiatives
that support sustainable performance. With a clear direction and a committed team, we are prepared to navigate the year with resilience and a
steady focus on creating lasting value for all stakeholders.
Signed by Mr. Simon Jethro Lay (Chief Executive Officer) on 26 March 2026
FIMBank Group Annual Report & Financial Statements 2025
6
Directors’ report
For the year ended 31 December 2025
The Directors present their report together with the Financial Statements of FIMBank p.l.c. (the “Bank”), and FIMBank Group of Companies (the
“Group”) for the year ended 31 December 2025. This report is prepared in accordance with Article 177 of the Companies Act, 1995 (Chapter 386,
Laws of Malta) (“the Companies Act”), including the further provisions as set out in the Sixth Schedule of the Companies Act.
Results for the year
For the year under review, the Group reported a profit after tax of USD181,378 (2024: USD149,989), while the Bank recorded a loss of USD4,334,499
(2024: USD3,203,686).
Further information about the results are provided in the Statements of Profit or Loss and the Statements of Other Comprehensive Income on pages
49 and 50 and in the Review of Performance section within the Directors’ Report.
Group structure and principal activities
The Group comprises the Bank and its wholly owned subsidiaries, London Forfaiting Company Limited (“LFC”), FIM Property Investment Limited
(“FPI”), The Egyptian Company for Factoring S.A.E. (“Egypt Factors”), and FIMFactors B.V. (“FIMFactors”). LFC and FIMFactors are themselves parents
of a number of subsidiaries as set out in Note 27 to the Financial Statements. The Group is supervised on a consolidated basis by the Malta Financial
Services Authority (“MFSA”), while some of its subsidiaries and branches are subject to authorisation and regulation according to the respective
jurisdictions in which they operate.
A brief description of the activities in the Group follows (% shareholding follows after the name):
• The Bank is a public limited company registered under the laws of Malta and listed on the Malta Stock Exchange. It is licensed as a credit
institution under the Banking Act, 1994. The Bank is primarily engaged in international trade finance, real estate financing, factoring, and loan
The Bank has a branch registered with the Dubai International Finance Centre, United Arab Emirates, which is regulated by the Dubai Financial
Services Authority in the United Arab Emirates.
• LFC (100%) is registered in the United Kingdom as a private limited liability company. It was founded in 1984 and provides international trade
finance services, with particular focus on forfaiting business, through an international network of offices. Some of these offices have distinct
corporate status in the various jurisdictions where they are providing the service. LFC’s activities include the trading of bills of exchange,
promissory notes, loans, deferred payment letters of credit and the provision of other financial facilities to banks, corporates and companies.
• FPI (100%), registered in Malta, owns and manages FIMBank’s Head Office and other properties leased from third parties. FPI is responsible for
facility management activities and the leasing of commercial and office space within Mercury Tower to related parties and third-party tenants.
• Egypt Factors (100%), registered in Egypt, is active in providing factoring services to Egyptian companies.
• FIMFactors (100%), registered in the Netherlands, is the corporate vehicle for the Bank’s holdings in factoring subsidiaries and associated
companies. These are:
a. India Factoring and Finance Solutions (Private) Limited (“India Factoring”) (99.56%), incorporated in Mumbai, India, is to carry out the
business of factoring in India. India Factoring is regulated by the Reserve Bank of India.
During the year ended 31 December 2025, the Board of Directors of India Factoring and its members approved the offer, issuance and
allotment of 51,041,897 shares having a nominal value of INR10 each at an issue price of INR10 to existing shareholders. In March 2025, the
Bank, through its subsidiary FIMFactors, subscribed to a first tranche of 26,100,000 newly issued and allotted shares of India Factoring for
INR261,000,000 (USD3,012,817). This increased the Group’s shareholding in India Factoring from 88.16% to 88.80%.
In April 2025, the Bank, through FIMFactors, entered into a share purchase agreement to acquire 19,902,291 shares in India Factoring from
a non-controlling interest for a total consideration of INR116,229,385 (USD1,352,418), effectively raising the Group’s shareholding from
88.80% to 92.87%.
FIMBank Group Annual Report & Financial Statements 2025
7
In June 2025, the total number of shares held by a non-controlling interest, the India Factoring Employee Welfare Trust, amounting to
326,966,290 shares, were extinguished pursuant to an order of the National Company Law Tribunal, Mumbai. Subsequently, the Registrar
of Companies in India issued a certificate of reduction of share capital for India Factoring by virtue of which the shares were officially struck
off the Registry. As a result, the Bank’s effective shareholding in India Factoring increased further to 99.54%.
In July 2025, the Bank made an additional investment of INR171,000,000 (USD1,995,565) in India Factoring. This investment is intended to
support the further growth of the company and its ability to do this within the regulatory capital requirements. As at 31 December 2025,
the Bank held 99.56% shareholding.
b. BrasilFactors S.A. (50%), equity-accounted investee incorporated in São Paulo, Brazil, specialising in factoring services for small and medium-
sized enterprises. The remaining 50% is owned by the Bank of China.
Review of performance
Though the global economy proved more resilient than expected, 2025 was marked by significant volatility, with growth forecasts revised frequently
as conditions evolved. Rising trade tensions, renewed inflationary pressures in certain sectors, fiscal concerns, uneven liquidity conditions, a gradual
easing in the interest rate environment and rapid developments in artificial intelligence created an uneven operating landscape. Against this
backdrop, the Group, like many international players, was impacted by these shifting dynamics.
Operationally, the Group performed well across all key areas, including core operating income, operating expenses, impairment charges and tax,
despite economic and geopolitical pressures affecting all entities. However, the year’s results were significantly impacted by the downward valuation
of USD5.8 million attributable to the investment in the Sustainable Investment Fund, which is held by the parent, FIMBank. The fund’s holdings are
concentrated in the renewable energy sector, where volatility in interest rates and long-term energy prices influenced valuation outcomes. Although
this investment is not part of the Group’s core business, it had a material effect on the Group’s results for the year, which is particularly disappointing
given the underlying operational progress achieved.
During the year, the Group continued to prioritise strengthening FIMBank as the parent entity, with a clear focus on improving financial performance
and reinforcing core revenue streams. While these have yet to reach the levels management aims to achieve, progress in operational areas has been
evident. The Group also advanced its strategy to exit non-core investments, a process that remains ongoing, with the objective of redeploying
financial and human resources towards the core business and supporting FIMBank’s long-term development.
The capital position continued to be a defining factor for the Group, requiring disciplined management of business volumes, which in turn influenced
revenue growth. Management remained focused on prudent capital allocation, maximising asset deployment within regulatory limits and ensuring
that available capital supported the activities that generate the strongest value for the Group.
Operating expenses remained well controlled despite adverse exchange rate movement. At the same time, the Group continued to invest in talent,
automation and major data transformation initiatives. These investments are essential for strengthening the operating model and enhancing long-
term efficiency, but they place upward pressure on costs at a time when maintaining a strong capital base remains a key priority. Management
continued to balance these competing demands while ensuring discipline in the overall cost base.
The Group maintained low levels of impairment and continued its focused efforts on recovering its legacy portfolio. For the fifth consecutive year,
the Group reported no material non-performing exposures, demonstrating the success of its sustained derisking strategy. Asset quality remained
strong, with the Non‑Performing Loan Ratio at 1.9% (December 2024: 2.85%), significantly improved from 20% in 2020. This ratio also remains below
the EU average NPL ratio for banks, underscoring the Group’s strong credit discipline and effective portfolio management.
Efforts to enhance tax efficiency progressed further at both entity and Group level. Particular attention was given to optimising the significant
recognised and unrecognised deferred tax assets available within FIMBank, ensuring these can be better utilised in the years ahead.
This progress was supported by continued strategic focus and strong leadership. The Group maintained disciplined execution of its transformation
initiatives, prioritising value creation and long-term performance. Organisational synergies and product reviews commenced during the year,
targeting meaningful improvements in efficiency and delivery.
Improvements in liquidity management contributed to a stronger net interest margin towards year end, reflecting the positive effect of the Group’s
proactive balance sheet measures. Capital adequacy and liquidity positions remained robust, demonstrating the Group’s ability to respond
effectively to evolving regulatory and market conditions. The Group ended the year with a Total Capital Ratio of 19.3%, well above the regulatory
minimum of 16.95%. Liquidity also remained strong, with an average Liquidity Coverage Ratio of 223% and an average Net Stable Funding Ratio of
153%. Both metrics exceeded regulatory requirements as well as internal thresholds. Together, these indicators highlight the Group’s financial
resilience, disciplined risk management, and its ongoing commitment to strengthening performance, enhancing shareholder value, and executing
its long‑term strategy in a prudent and sustainable manner.
FIMBank Group Annual Report & Financial Statements 2025
8
The lack of revenue growth and the challenges posed by tight capital positions are expected to ease following the planned restructuring of FIMBank’s
shareholding. In line with the company announcement of 30 October 2025, Jordan Kuwait Bank, part of Kuwait Projects Company (Holding) KSCP,
announced its intention to acquire FIMBank’s shares from the current majority shareholders, United Gulf Holding Company B.S.C. and Burgan Bank
K.P.S.C. Completion of the transaction remains subject to regulatory approval in Jordan and Malta. The Group devoted significant effort during 2025
to support both existing and prospective shareholders in progressing this process. While this required considerable management attention, the
restructuring is expected to provide the stability needed for the Group to continue developing and implementing its strategy and to achieve long-
term objectives for both the Bank as a standalone institution and the Group as a whole.
In line with this strategic direction, Egypt Factors was classified as held for sale in 2025. Its results are therefore presented as ‘Profit from
discontinued operations’ in the Statement of Profit or Loss (see Note 17). The 2024 figures have been restated in accordance with IFRS requirements
to provide clear comparatives between continuing and discontinued operations. All narrative and tabular information in this report reflects these
restated values.
Fitch Ratings has upgraded FIMBank’s Long‑Term Issuer Default Rating (IDR) from ‘B’ to ‘B+’, with a Stable Outlook. This upgrade follows last year’s
positive outlook revision and represents a significant milestone in the Group’s transformation journey.
FIMBank p.l.c.
In 2025, the Bank remained focused on its transformation agenda, driving continued improvements in operating performance with a strong
emphasis on strengthening its core business and enhancing operational efficiency. A positive trend in interest margin expansion persisted, supported
by stronger pricing discipline and improved capital utilisation and enhanced balance sheet management. Net interest and fee income increased by
USD4.7 million (21.9%), reflecting the combined impact of optimised asset origination and disciplined liquidity management. The introduction in the
previous year of a structured management recharge to subsidiaries further strengthened performance accountability and operational efficiency
across the Group, while also contributing positively to the net interest margin.
Commercial assets remained stable, with solid performance across trade finance, real estate and foreign exchange. During the year, the Bank
initiated a series of operational and product reviews aimed at streamlining processes and improving efficiency across key functions. The
establishment of a new Retail and Corporate Banking department further strengthened customer engagement and enhanced cross selling
opportunities across client segments.
Efforts to diversify the deposit base continued successfully, supporting funding stability and reducing reliance on concentrated sources of funding.
The year’s results were however significantly affected by the downward valuation of USD5.8 million attributable to the investment in the Sustainable
Investment Fund. The fund’s holdings are concentrated in the renewable energy sector, where market conditions including volatility in interest rates
and long-term energy prices continue to influence valuation outcomes. Although this investment is not part of the Bank’s core business, it had a
material impact on the Bank’s reported performance.
Dividend income from subsidiaries amounted to USD0.8 million, compared with USD6.0 million in the previous year. Operating expenses remained
well managed at USD25.2 million, representing a 3% increase over last year. Net impairment losses were contained at USD0.7 million, a significant
improvement from USD4.7 million in 2024. Tax paid abroad amounted to USD0.9 million, consistent with the prior year.
While the core business continued to perform well, the lower dividend income and the fair value loss on the Sustainable Investment Fund had a
material adverse impact on the financial result for the year. As a result, the Bank closed 2025 with a loss of USD4.3 million, compared with a loss of
USD3.2 million in December 2024.
FIMBank Group Annual Report & Financial Statements 2025
9
London Forfaiting Company Limited
LFC operated in a challenging economic environment in 2025, marked by lower interest rates, abundant liquidity in the trade finance market, rising
trade tariffs and continued geopolitical uncertainty. These conditions exerted pressure on margins and overall performance. Net interest and fee
income amounted to USD15.4 million, a decrease of USD5.7 million compared with the previous year. Realised and unrealised trading gains totalled
USD0.5 million, an improvement of USD1.0 million over 2024. Operating expenses remained well controlled at USD9.7 million. The tax expense of
USD1.3 million was USD1.4 million lower than the prior year, reflecting the pre-tax profitability combined with diligent tax planning. As a result of
these dynamics, profit for the year decreased by 44%, from USD8.3 million in 2024 to USD4.6 million in 2025. Despite this decline, the Group
considers these results solid and a clear reconfirmation that LFC can withstand market pressures and continue to deliver meaningful profitability.
LFC remains well positioned to adjust its portfolio mix swiftly and effectively in response to shifts in the trading environment.
During the year, LFC welcomed a new strategic partner, leveraging its established capabilities to source Sub Saharan African assets. Funding
diversification continued to advance, with external credit lines increasing by 50% year-on-year. The company also successfully launched the
equivalent of USD100 million in Eurobond issuances on The International Stock Exchange, further strengthening its funding base.
LFC expanded its global trading footprint in 2025, increasing the trading portfolio from USD274.7 million at year-end 2024 to USD445 million at year-
end 2025. The portfolio remained short-term in nature, with a weighted average tenor slightly above one year, providing a strong platform for
income generation in 2026 despite the challenging backdrop. Although market conditions are expected to remain difficult, with trade tariffs affecting
asset availability and surplus liquidity compressing margins, entering 2026 with a larger portfolio provides a solid base for income generation. The
continuing decline in interest rates also presents favourable trading opportunities for the year ahead.
India Factoring and Finance Solutions (Private) Limited
India Factoring delivered a strong performance in 2025. Operating income before credit impairment amounted to USD7.5 million, an decrease of
3.7% over the previous year, while operating expenses rose by 9.9% to USD5.3 million. The entity reported a net impairment charge of USD0.3
million, compared with a net impairment release of USD2.0 million in 2024. The tax charge amounted to USD0.8 million, significantly lower than the
USD4.1 million recorded in the previous year, when the entity wrote-off deferred tax assets due to uncertainty regarding their utilisation before
expiry. Taken together, these positive and negative movements largely offset one another when compared with 2024. As a result, profit for the year
increased to USD1.0 million, representing an improvement of USD0.8 million over the previous year.
Despite subdued market activity following erratic and significant tariff adjustments, the entity maintained strong invoice turnover, volumes and
revenues. Cost discipline also remained firm throughout the year.
The balance sheet continued to strengthen, with funds in use increasing by 17% year-on-year, driven primarily by export related business. Customer
concentration improved as exposure to the top ten clients declined, while credit quality remained robust with no significant non-performing assets.
A substantial portion of the portfolio remained covered through import factors or trade insurers, thereby mitigating portfolio risk.
Funding diversification progressed significantly, supported by the onboarding of new credit lines that enhanced liquidity and financial flexibility.
Operationally, the company maintained its position as the leading export factor in India for the eighth consecutive year and ranked fourth globally.
The company’s credit rating improved to ACUITE A minus for long-term facilities and ACUITE A2 plus for short-term facilities, which is expected to
facilitate access to additional local funding through lower risk weights.
The company continued to maintain its Capital Adequacy Ratio above the regulatory minimum and revenue and assets attributable to factoring and
financing activities remained well above the thresholds set by the local regulator.
The Egyptian Company for Factoring S.A.E.
Egypt Factors delivered a solid operational performance; however, the results were adversely affected by higher Stage 3 provisions. Net interest
and fee income amounted to USD4.5 million, an increase of 1.0%, while operating expenses rose by 3.8% to USD2.9 million. The increase in net
impairment losses, totalling USD1.2 million (December 2024: USD0.1 million), had the most significant impact on profitability. As a result, net profit
declined from USD1.4 million in 2024 to USD0.4 million in 2025.
In 2025, Egypt Factors maintained stable invoice turnover, reflecting its operational resilience in a challenging economic environment. The factoring
portfolio grew by 11.6%, demonstrating the company’s success in broadening its customer base and enhancing service quality. In addition, Egypt
Factors secured external funding from several local banks, including foreign currency facilities, further strengthening its funding position and
supporting future growth.
In line with the Group’s strategic decision to focus on core business and release capital and operational resources, Egypt Factors was classified as
held for sale in 2025. Accordingly, its results are presented as ‘Profit from discontinued operations’.
FIMBank Group Annual Report & Financial Statements 2025
10
Statements of profit or loss
Similar to 2024, the Group closed the year just above break-even after tax and discontinued operations, reporting a total profit of USD181,378 for
2025 (2024: USD149,989).
For the financial period ending 31 December 2025, the Group reported a pre-tax profit from continuing operations of USD2.2 million, compared
with USD4.5 million in the previous financial year. The post-tax loss from continuing operations amounted to USD1.6 million, compared with a loss
of USD3.7 million in 2024.
The Group recorded a profit from discontinued operations of USD1.7 million, compared with USD3.8 million in the prior year.
Group earnings per share were at US cents 0.02 (2024: US cents 0.02). Group earnings per share from continuing operations were at negative US
cents 0.31 (2024: negative US cents 0.71).
The results for the year under review are summarised in the table below, which should be read in conjunction with the explanatory commentary
that follows:
Group
2025
2024
Movement
USD
USD
USD
Net interest income
45,847,603
44,844,841
1,002,762
Net fee and commission income
846,907
902,797
(55,890)
Other operating income
(4,989,507)
117,760
(5,107,267)
Operating results from non-trading portfolio
41,705,003
45,865,398
(4,160,395)
Operating expenses
(39,315,834)
(37,763,751)
(1,552,083)
Income before net impairment and net trading results
2,389,169
8,101,647
(5,712,478)
Net trading results
488,151
(1,200,134)
1,688,285
Net impairment losses
(676,214)
(2,400,194)
1,723,980
Profit before taxation
2,201,106
4,501,319
(2,300,213)
Taxation
(3,766,014)
(8,169,920)
4,403,906
Loss for the year from continuing operations
(1,564,908)
(3,668,601)
2,103,693
Profit from discontinued operations
1,746,286
3,818,590
(2,072,304)
Profit for the year
181,378
149,989
31,389
The Group reported ‘Operating results from the non-trading portfolio’ of USD41.7 million, a decrease of USD4.2 million (9.1%) compared with the
previous year, entirely attributable to the performance of a non-core investment in a sub fund focused on renewable energy.
‘Net interest income’ (see Note 8) increased by USD1.0 million (2.2%) year-on-year to reach USD45.8 million. This reflected movements in both
interest income and interest expense. Interest income decreased by USD14.5 million. This included a reduction of USD8.1 million in interest income
‘on trading assets’ due to lower interest rates and reduced balances during the first half of the year. This was influenced by management’s decision
to maintain a cautious position while the potential impact of changes introduced under CRD VI and CRR III was still being assessed. A further decrease
of USD3.1 million in interest income ‘on balances with the Central Bank of Malta and amounts owed to institutions’, and a decrease of USD2.0 million
in interest income ‘on treasury bills purchased at a discount’, resulted from lower balances as the Group continued to reduce liquidity buffers in line
with its liquidity optimisation strategy. Interest income ‘on loans and advances to customers’ declined by USD1.2 million due to lower balances in
the real estate loan portfolio, which the Group continues to limit because of its high capital consumption.
These reductions in interest income were more than offset by a decrease of USD15.5 million in interest expense. The largest movement was a
reduction of USD10.9 million in interest expense ‘on amounts owed to customers’, reflecting lower interest rates and reduced volumes of customer
term deposit, particularly in the first half of the year, consistent with the contraction in the trading assets and loan portfolios. Interest expense ‘on
amounts owed to Central Bank and institutions’ decreased by USD3.8 million, while interest expense ‘on amounts owed to banks’ declined by
USD1.6 million due to lower balances of borrowings and deposits from financial institutions.
Overall, both interest income and interest expense were also influenced by lower benchmark rates throughout 2025.
FIMBank Group Annual Report & Financial Statements 2025
11
‘Net fees and commission income’ (see Note 9) amounted to USD0.8 million and remained broadly in line with the previous year. Net fee income
has declined significantly in recent years as most fee components form an integral part of the effective interest rate and are therefore recognised
within net interest income in accordance with IFRS 9.
‘Other operating income’ reflected a loss of USD5.0 million compared with a marginal profit of USD0.1 million in the previous year. This loss is
attributable to the ‘financial investments at fair value through profit or loss’, specifically the investment in the Sustainable Investment Fund. The
fund’s holdings are concentrated in the renewable energy sector, where market conditions including volatility in interest rates and long-term energy
prices continue to affect valuation outcomes. Electricity prices remained subdued throughout 2025 due to lower demand and increased supply in
the region where the investment is located, which contributed to a downward adjustment in the valuation. Although this investment is not part of
the Group’s core business, it had a material impact on the Group’s reported performance.
‘Operating expenses’ amounted to USD39.3 million, an increase of USD1.6 million (4.1%) compared with the previous year. The increase reflects
continued investment in systems and technology infrastructure, together with the need to attract and retain talent to support strategic objectives
and was further affected by the weaker EUR/USD exchange rate.
The ‘net trading results’ recorded a gain of USD0.5 million, compared with a loss of USD1.2 million in the previous year. The improvement is
attributable to the trading book at the Group’s subsidiary, LFC, which had been negatively affected in 2024 by the default of an asset and by broader
geopolitical developments and monetary and fiscal policy shifts in major markets. During 2025, the subsidiary managed to navigate these conditions
more effectively, achieving a stronger trading performance.
‘Net impairment losses’ continued to normalise, amounting to USD0.7 million compared with USD2.4 million in the previous year. Asset quality
remained strong, with the Non‑Performing Loan Ratio at 1.9% (December 2024: 2.85%), significantly improved from 20% in 2020. Management’s
efforts over recent years have contributed to this sustained improvement in asset quality, supporting the reduction of the NPL ratio to its current
stable level.
In 2025, tax provisions across all Group entities totalled USD3.8 million, down from USD8.2 million in 2024 and relate entirely to tax accrued for the
year. Each entity carried out an assessment to ensure that recognised deferred tax assets remain recoverable before expiry, where applicable.
During 2025, Egypt Factors was classified as held for sale (see Note 17). The entity’s profit for 2025 and the 2024 comparative are therefore
presented as ‘Profit from discontinued operations’.
Financial position
As at 31 December 2025, the Group’s Consolidated assets amounted to USD1.36 billion, an increase of USD215.1 million (18.8%) compared with the
previous year. This growth was driven by strategic efforts to rebuild the asset base across the year. On an average annual basis, however,
Consolidated assets were 7.7% lower than the prior year’s average, reflecting the Group’s decision to maintain a conservative capital buffer in late
2024 and early 2025 while awaiting full clarity on the regulatory implications of CRD VI and CRR III.
The increase in Consolidated assets resulted from a combination of movements across several asset classes. Trading assets (see Note 21) increased
by USD170.1 million (61.9%) and were the main driver of asset growth, reversing the reductions recorded at the end of the previous year. Loans and
advances to customers (see Note 23) increased by USD10.4 million (2.4%) despite the removal of balances relating to Egypt Factors, which were
reclassified as ‘Assets classified as held for sale’.
Balances with the Central Bank of Malta and treasury bills (see Note 19) decreased by USD49.7 million (37.0%) as the Group continued to adjust and
optimise its liquidity buffers. Loans and advances to banks (see Note 22) decreased by USD8.4 million (8.8%). Financial investments at amortised
cost (see Note 26) increased by USD39.2 million to USD41.3 million. Financial investments at fair value through other comprehensive income (see
Note 25) decreased by USD15.0 million (12.5%) in line with the shift towards a hold to collect model. Financial investments at fair value through
profit or loss (see Note 24) declined by USD4.1 million (29.2%) mainly due to lower fair value of the Sustainable Investment Fund.
Average movements across asset categories broadly mirrored the year-end direction. Balances with the Central Bank of Malta and treasury bills
declined by an average of USD149.6 million (70.3%). Loans and advances to customers decreased by an average of USD7.9 million (1.8%). Financial
investments at FVOCI fell by an average of USD14.8 million (11.3%), while financial investments at FVTPL declined by an average of USD6.0 million
(33.5%). In contrast, average increases were recorded in trading assets (USD12.7 million or 3.5%), loans and advances to banks (USD24.6 million or
26.2%), and financial investments at amortised cost (USD12.5 million or 128.7%).
Throughout the year, Egypt Factors was classified as held for sale (see Note 17). Its assets amounting to USD67.7 million are presented as ‘Assets
classified as held for sale’. In line with IFRS 5, the 2024 comparative figures have not been reclassified.
FIMBank Group Annual Report & Financial Statements 2025
12
The Group’s deferred tax asset decreased from USD15.7 million to USD15.2 million (see Note 32) due to utilisation. A review of deferred tax assets
and subsidiary investments confirmed the adequacy of carrying amounts, taking into account macroeconomic conditions, regulatory developments
and capital management strategies. Management also continued to evaluate strategic options for subsidiaries and to optimise funding sources while
enhancing revenue generation through operational efficiencies.
The Group recorded an increase in property, plant and equipment and in investment property. Property, plant and equipment increased by
USD0.9 million (see Note 28) mainly due to depreciation charges and foreign exchange gains. Investment property increased by USD2.7 million (see
Note 29) driven primarily by foreign exchange movements. As part of its regular review, the Group undertook an internal assessment of investment
property, taking into account market trends, rental levels at comparable premium business centres and broader economic conditions. This supports
alignment with market conditions and the Group’s long-term strategy.
As at 31 December 2025, Consolidated liabilities amounted to USD1.18 billion, an increase of USD214.9 million (22.3%), broadly mirroring asset
growth. This was driven mainly by a USD169.9 million increase in amounts owed to customers (25.0%) (see Note 35), largely reflecting higher term
deposit balances. Amounts owed to institutions and banks (see Note 34) decreased by USD18.6 million (7.7%) due to lower repayable on demand
deposits from financial institutions, partly offset by higher participation in liquidity providing measures with the European Central Bank. Debt
securities in issue (see Note 36) increased by USD1.9 million (12.2%) to USD17.8 million.
In February 2025, the Bank received a subordinated loan of USD20.3 million (December 2024: Nil) from a subsidiary of its ultimate parent (see
Note 39). In the event of liquidation or winding up, this instrument ranks below the Bank’s unsubordinated creditors. The loan qualifies as Tier 2
capital under the Capital Requirements Regulation.
Throughout the year, Egypt Factors was classified as held for sale. Its liabilities amounting to USD41.8 million are presented as ‘Liabilities directly
associated with the assets held for sale’. In accordance with IFRS 5, the 2024 comparative amounts have not been reclassified.
Total equity (see Note 40) stood at USD183.9 million, broadly in line with the previous year (December 2024: USD183.6 million). Movements that
offset one another included a USD1.6 million net fair value gain on financial investments measured at FVOCI, a USD0.8 million reduction in retained
earnings following the transfer of losses from the non-controlling interest due to changes in its percentage shareholding, and a further
USD0.4 million negative movement in non-controlling interest. As at 31 December 2025, the Group’s CET1 and TCR ratios stood at 17.5% and 19.3%
respectively (2024: CET 1 and TCR were both 21.3%).
Total Consolidated commitments (see Note 43) stood at USD171.2 million, up from USD132.2 million in 2024. These mainly comprised confirmed
letters of credit, documentary credits, commitments to purchase forfaiting assets, and undrawn credit facilities. Total Consolidated contingent
liabilities (see Note 42) remained stable at USD29.7 million (2024: USD31.0 million), consisting mainly of outstanding guarantee obligations.
Principal risks and uncertainties
FIMBank is a banking group offering a suite of trade finance products across the different geographies it operates in, mainly emerging markets. The
risks associated with this business model are multiple and varied. Exposure to credit risk, liquidity risk, interest rate risk and foreign exchange risk
arises in the normal course of the Group’s business. As the Group is mainly engaged in cross-border trade finance transactions, the business
performance is also impacted by the overall performance of the world economy, in particular to the level of cross-border trade between countries
at varying stages of their economic development and which may not yet have achieved the level of stability of developed countries. This exposes
the Group to risks of political and economic changes including volatilities to commodity prices, exchange control regulation and difficulties in
preserving own legal rights.
Both FIMBank and its main Group entities are exposed to such risks in different degrees based on their size and complexity. FIMBank, as the parent
company, ensures that all Group entities adhere to the Group’s risk, governance and compliance frameworks as updated from time to time.
Further disclosures on the Group’s principal risks and uncertainties are provided in Note 4 of this Annual Report and the 2025 Pillar 3 Disclosures
Report published on the Bank’s website.
FIMBank Group Annual Report & Financial Statements 2025
13
Outlook for 2026
Global growth is expected to moderate in 2026 as the temporary factors that supported resilience in the previous year gradually unwind. Trade
activity is projected to normalise as firms adjust inventory levels and the effects of higher tariffs are absorbed. Advanced economies are expected
to continue performing relatively well, while many emerging and developing markets will continue to face slower income growth, elevated debt
levels and financing constraints. This uneven backdrop, combined with subdued trade flows and heightened geopolitical uncertainty, is expected to
shape business sentiment, funding conditions and cross border activity throughout the year. These factors will continue to influence the Group’s
operating environment over the year.
2026 marks an important year for the Group. In line with FIMBank’s company announcement dated 30 October 2025, Jordan Kuwait Bank, which
forms part of Kuwait Projects Company (Holding) KSCP (KIPCO Group), announced its intention to acquire FIMBank’s shares from the current majority
shareholders, United Gulf Holding Company B.S.C. and Burgan Bank K.P.S.C., both of which are subsidiaries within the KIPCO Group. Completion of
the transaction remains subject to regulatory approvals in both Jordan and Malta. In anticipation of this milestone the Group has devoted significant
effort during 2025 and will continue to do so throughout 2026 to support both existing and prospective shareholders in bringing this transaction to
completion. Once finalised, the new ownership structure is expected to further support and refine FIMBank’s strategic direction, enhancing the
Group ability to deliver on its long‑term objectives, including increasing business volumes, enhancing income generation, improving the
cost‑to‑income profile, strengthening synergies and driving greater operational efficiency.
As part of the Group’s strategic direction, the sale of Egypt Factors, classified as a discontinued operation in 2025, is expected to progress during
2026. This divestment will release both capital and management capacity, enabling the Group to focus more closely on its core business activities
and strategic priorities.
Encouraging progress under the Group’s transformation programme continues to reinforce confidence in the strategic direction being pursued. The
Group remains mindful that sustainable transformation requires time, disciplined execution and strong shareholder support. Throughout 2026 and
beyond, the Group remains firmly committed to a long‑term, sustainable approach to improving performance. Key priorities include maintaining
strong risk management and elevated regulatory compliance, increasing the use of data‑driven decision‑making, and maintaining a dynamic and
diversified business pipeline to support sustainable growth. Ongoing initiatives will continue to streamline and optimise operational efficiency
through simplification, reduced organisational complexity, the removal of bottlenecks and improved alignment of resources with strategic priorities.
Enhanced processes, leaner structures and an improved client experience will continue to contribute to productivity gains.
FIMBank, as the parent entity based in Malta, will remain central to driving overall Group performance. Greater coordination across Group entities
is expected to increase agility and responsiveness. Strategic alliances will continue to strengthen the Group’s value proposition, and subsidiaries
with strong growth potential and return/risks profile will be supported with the appropriate capital and funding support to reinforce the Group’s
broader regional presence.
Investment in infrastructure and human capital will continue remaining a core enabled of the Group strategy supporting business growth and
leveraging Group synergies, thereby contributing to improved the cost‑to‑income ratio. Human capital remains essential to the Group’s success;
attracting, developing and retaining talent will be key to supporting operational excellence and service quality. During 2026, the Group will also
advance its data‑transformation journey, including allocating additional resources and investing in enhanced data governance, warehousing and
analytics capabilities. These efforts will strengthen decision‑making, improve risk management and enhance overall operational insight, along
preparing for future regulatory requirements.
With a solid capital base, focused leadership and a clear long‑term strategy, the Group enters 2026 well positioned to maintain momentum and
deliver further progress.
Dividends and reserves
As none of the reserves are available for distribution, the Board of Directors will not be recommending the payment of a dividend to the Annual
General Meeting of Shareholders (2024: Nil).
Standard licence conditions and regulatory sanctions
During the year under review, no breaches of licence requirements occurred. Moreover, no regulatory sanctions were taken against the Bank.
FIMBank Group Annual Report & Financial Statements 2025
14
Approvals at the annual general meeting of shareholders
The Bank convened its Annual General Meeting on 13 May 2025 and all statutory Ordinary Resolutions were approved.
Shareholder register information pursuant to capital markets rule 5.64
The Directors refer to the following disclosures in terms of the Capital Markets Rule 5.64:
a. details of the structure of the share capital, the class of shares and the rights and obligations attached to it and the percentage of total share
capital that it represents are, unless otherwise stated in this report, disclosed in the Notes to the Financial Statements;
b. except as provided for by Article 41 of the Articles of Association of the Bank, or where the consent of the Supervisory Authority (MFSA) may be
required, there are no restrictions on the transfer of securities, or limitations on the holding of securities, or the need to obtain the approval of
the Bank or other holders of securities of the Bank for any such transfer or holding. Shareholders holding 5% or more of the share capital as at
31 December 2025 are as follows:
No of shares
United Gulf Holding Company B.S.C.
420,019,110
Burgan Bank K.P.S.C.
44,394,499
c. there is no share scheme in place which gives employees the rights to any form of control;
d. the Bank’s Articles of Association do not contain more stringent provisions than the ones contained in the Companies Act governing the changes
or variations in the rights attached to shares;
e. in terms of Article 12 of the Bank’s Articles of Association, the rights attached to any class of shares may be varied either with the consent in
writing of the holders of not less than 80% of the issued shares of that class or with the sanction of an extraordinary resolution passed at a
separate general meeting of the holders of shares of that class. The Banking Act requires the Bank to obtain the consent of the Supervisory
Authority (MFSA) to affect any material change in voting rights;
f. the rules and procedures governing the appointment and replacement of Board Members are provided by the Articles of Association and are
referred to in the Statement of Compliance with the Principles of Good Corporate Governance. Any amendments to the Articles shall be by
means of an extraordinary resolution in accordance with the provisions of Articles 90 and 91;
g. unless otherwise disclosed in this Annual Report, there are no significant agreements to which the Bank is a party and which take effect, alter
or terminate upon a change of control of the Bank following a takeover bid and the effects thereof; and
h. there are no agreements between the Bank and its Board Members or employees providing for compensation if they resign or are made
redundant without valid reason or if their employment ceases because of a takeover bid.
At as 31 December 2025, the Bank had no securities with special control rights in accordance with the Capital Markets Rule 5.64.4.
Events after the financial reporting date
Investments in subsidiaries
In March 2026, the Bank made an additional investment of INR461,500,000 (USD5,013,580) in India Factoring and Finance Solutions Private Limited
(“India Factoring”). This investment is intended to support the further growth of the company and its ability to do this within the regulatory capital
requirements.
The Group has no other subsequent events to report.
FIMBank Group Annual Report & Financial Statements 2025
15
Going concern
As required by the Capital Markets Rule 5.62, upon due consideration of the Bank’s performance, financial position, capital adequacy and solvency,
the Directors confirm that, at the time of approving these Financial Statements, the Bank is capable of continuing to operate as a going concern for
the foreseeable future.
The Directors have also taken into consideration the geopolitical tensions that emerged in the Middle East after the balance sheet date, which have
contributed to regional instability and heightened uncertainty in global markets. Following Management’s assessment of the potential impact of
these developments on the Group’s and the Bank’s financial position, ongoing performance and strategic actions, it was concluded that the effect
on the going concern assessment and on core business activities is not significant. Nonetheless, given the elevated level of uncertainty and the
potential implications arising from the evolution of these events, the Group and the Bank will continue to monitor the situation closely and update
their assessment as necessary.
Directors
The Directors who served during the financial year, including any changes up to the publishing date of the Annual Report were:
John C. Grech (Chairman) CGC, BCC, BRIC
Masaud M.J. Hayat (Vice Chairman) BNRC
Edmond Brincat BAC, BNRC, BRIC, CGC
Hussain Abdul Aziz Lalani BAC, BRC, BRIC, BESG
Rabih Soukarieh BCC
Samer Abbouchi BCC, BRC
Simon Jethro Lay BRIC, BESG Approved by Regulator on 6 March 2025
Sunny Bhatia CGC, BNRC
Teuta Bakalli BAC, BRC, BESG
Denotes membership of:
• Board Audit Committee (“BAC”)
• Board Credit Committee (“BCC”)
• Board Review and Implementation Committee (“BRIC”)
• Board Risk Committee (“BRC”)
• Corporate Governance Committee (“CGC”)
• Board Nomination and Remuneration Committee (“BNRC”)
• Board Environmental, Social and Governance Committee (“BESG”)
FIMBank Group Annual Report & Financial Statements 2025
16
Statement of responsibility
This Statement of responsibility is required in terms of the Capital Markets Rule 5.55.2 and set out in the form required by the Capital Markets Rules
5.67 to 5.69.
The Companies Act, 1995 (Chapter 386, Laws of Malta) requires the Directors of the Bank to prepare financial statements for each financial year
which give a true and fair view of the assets, liabilities and financial position of the Bank and the Group as at the end of the financial year and of the
profit or loss of the Bank and the Group for that period in accordance with the requirements of International Financial Reporting Standards as
adopted by the EU.
The Directors are responsible for keeping proper accounting records which disclose with reasonable accuracy, at any time, the financial position of
the Bank and the Group and to enable them to ensure that the financial statements have been properly prepared in accordance with the provisions
of the Companies Act, 1995 (Chapter 386, Laws of Malta) and the Banking Act, 1994 (Chapter 371, Laws of Malta). The Directors also ensure that
the financial statements of the Group are prepared in accordance with Article 4 of the IAS Regulation.
The Directors are also responsible for safeguarding the assets of the Bank and the Group and hence for taking reasonable steps for the prevention
and detection of fraud and other irregularities.
The Directors, through oversight of Management, are responsible to ensure that the Bank and the Group establish and maintain internal controls
to provide reasonable assurance with regard to reliability of financial reporting, effectiveness and efficiency of operations and compliance with
applicable laws and regulations.
Management is responsible, with oversight from the Directors, to establish a control environment and maintain policies and procedures to assist in
achieving the objective of ensuring, as far as possible, the orderly and efficient conduct of the Bank’s business. This responsibility includes
establishing and maintaining controls pertaining to the Bank’s and the Group’s objective of preparing financial statements as required by the
Companies Act, 1995 (Chapter 386, Laws of Malta) and managing risks that may give rise to material misstatements in those financial statements.
In determining which controls to implement to prevent and detect fraud, Management considers the risks that the financial statements may be
materially misstated as a result of fraud.
Independent auditors
During 2025, PricewaterhouseCoopers (“PwC”) were appointed as statutory auditors of the Group and Bank at the Annual General Meeting which
was held on 13 May 2025. PwC have expressed their willingness to continue in office as auditors of the Bank and a resolution proposing their re-
appointment will be submitted at the forthcoming Annual General Meeting.
Approved by the Board of Directors and signed on its behalf by Dr. John C. Grech (Chairman) and Mr. Masaud M.J. Hayat (Vice Chairman) on 26
March 2026 as per Director’s Declaration on ESEF Annual Financial Report submitted in conjunction with the Annual Report and Financial
Statements 2025.
Registered Address
Mercury Tower
The Exchange Financial and Business Centre
Elia Zammit Street
St. Julian’s STJ 3155
Malta
FIMBank Group Annual Report & Financial Statements 2025
17
Statement of compliance with the principles of good
corporate governance
For the year ended 31 December 2025
Introduction
Pursuant to the requirements of Capital Markets Rules 5.94 et seq of the Malta Financial Services Authority (the “MFSA”), the Board of Directors
(the “Board” or “Directors”) of FIMBank p.l.c. (the “Bank” or “FIMBank”) hereby details the extent to which the Code of Principles of Good Corporate
Governance (the “Principles”), published as Appendix 5.1 to Chapter 5 of the Capital Markets Rules, have been adopted together with the effective
measures taken to ensure compliance with such Principles.
In relation to the requirement to state how the Bank has applied the main principles emanating from the Code of Principles of Good Corporate
Governance, the Bank has done so by complying with and taking cognisance of the associated provisions (that is, the supporting principles and Code
provisions), unless otherwise stated within this Statement of compliance with the principles of good corporate governance.
Part 1: Compliance with the principles
The Board firmly believes that strong corporate governance permits the Bank and the Group to benefit from greater transparency in its activities,
as well as in its relations with the market, thereby enhancing integrity and confidence. Although the Principles are not mandatory, the MFSA has
recommended that listed companies endeavour to adopt such Principles. The Board has considered this to be in the best interest of the shareholders
because they commit the Directors, management and employees of the Bank to internationally recognised standards of corporate governance.
Ultimate responsibility for good corporate governance remains with the Directors who have therefore resolved to adopt the Principles and endorse
them accordingly, except for those instances where particular circumstances exist that warrant non-adherence thereto, or at least postponement
for the time being.
The Board is committed to improve further its corporate governance standards which is an ongoing process.
Principle 1: Roles and responsibilities of the board
The Bank is headed by an effective Board which leads and controls the company. The Board of Directors’ terms of reference are included in the
relevant charter and can be summarised as follows:
The Board is responsible for the overall long-term direction of the Group, for setting its strategy and policies and ensuring that they are pursued
through good management practices. The Board carries out its responsibilities by:
a. exercising prudent and effective controls and ensuring that such controls are appropriately reviewed for effectiveness and monitored for
compliance on a regular basis;
b. determining the strategic aims and the organisational structure;
c. regularly reviewing management performance and ensuring that the Group has the appropriate mix of financial and human resources to run its
business;
d. being conversant with relevant statutory and regulatory requirements;
e. ensuring that all Directors regularly attend meetings of the Board, agree on business objectives, financial plans and general parameters within
which the Board, the Board Committees and management are to function;
f. ensuring that systems and controls are in place to mitigate significant business risks and that exposures are identified and properly managed;
g. setting appropriate business standards, codes of corporate governance and ethical behaviour for all Directors and employees, as well as
monitoring their performance;
h. appointing the Group Chief Executive Officer (“GCEO”) who is entrusted with day-to-day management of the Group and its operations, together
with members of management; and
i. appointing senior management through the Board Nomination and Remuneration Committee.
Over the years, the Board has created a framework through which it effectively performs its functions and discharges its liabilities. The Board has
also established terms of reference and charters for the various Board Committees and the conduct of their meetings.
FIMBank Group Annual Report & Financial Statements 2025
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The Members of the Board of Directors of the Bank bring to their office a mix of backgrounds and capabilities, ranging from business to financial
services. This ensures a good blend of expertise and experience. Moreover, the suitability of any individual to become a Director of the Bank is, in
the first place assessed by the Board Nomination and Remuneration Committee. As part of its work, this Committee is tasked with performing an
annual evaluation of the Board’s overall performance in addition to an evaluation on the performance of each individual Member. This includes an
evaluation of the knowledge and experience of each Member while also assessing their authorities and leadership skills. As a result, this Committee
screens individuals for the position of Director against the Bank’s requirements at the time. Subsequently, the proposal for an individual to become
a Director is assessed by the MFSA which reviews, inter alia, the individual’s competence to serve as Director against established ‘fit and proper’
criteria. In this connection, the individual is required to provide all information, including detailed personal and career information, as the competent
authorities may deem necessary. Upon appointment, new Directors receive general information about the Bank, its business and affairs, and queries
in this regard are in the first instance handled by the Company Secretary and/or the GCEO.
Principle 2: Roles and responsibilities of the chairman and of the group chief executive
officer
The roles of the Chairman and of the GCEO are completely separate from one another to ensure clear division of responsibilities at the head of the
Bank.
The Chairman is a non-executive officer who is selected from amongst the Directors. The Chairman is responsible for leading the Board and setting
its agenda, ensuring that the Directors receive precise, timely and objective information so that they can properly execute their duties, encouraging
their active engagement in meetings and issues brought before the Board and ensuring effective communication with shareholders. The Chairman
also facilitates the effective contribution of Non-Executive Directors in particular and ensures constructive relations between Executive and Non-
executive Directors. As the Non-Executive Directors are not involved in the day-to-day running of the business, they can bring fresh perspectives
and contribute more objectively, in supporting as well as constructively challenging and monitoring the management team.
Whilst recognising that most shareholder contact is with the Chief Executive Officer and the Head of Investor Relations, the Chairman maintains
sufficient contact with shareholders to understand their issues and concerns.
The GCEO is the most Senior Executive of the Group and is appointed by the Board of Directors. He is responsible for leading management in the
execution of the Bank’s strategy and running the day-to-day activities of the Group.
Principle 3: Board composition and appointment of directors
The Bank ensures that the Board is not so large as to be unwieldy. In this respect, the Board is of sufficient size that the balance of skills and
experience is appropriate for the requirements of the business and that changes to the Board’s composition can be managed without undue
disruption. The Board is composed of Executive and Non-Executive Directors, including independent non-executives. The Bank’s Articles of
Association contain detailed provisions (in Clauses 93 to 114) as to the manner of appointment and retirement of the Directors. Directors hold office
from the close of the Annual General Meeting at which they are appointed until the day of the consecutive Annual General Meeting, at which they
become eligible for re-election. The Articles of Association also provide that the Chairman and Vice Chairman are to be appointed by the Directors
from amongst their number and shall hold office for a period of one year, unless otherwise decided by a simple majority of the Board. Any Member
may nominate an individual in the manner prescribed by the Articles of Association, provided that such nomination is seconded by a Member or
Members who in aggregate hold at least twenty thousand (20,000) shares between them.
As at the date of this Statement, the Directors and their respective first date of appointment to the Board, including identification as required by
Code Provision 3.2 for those Directors deemed independent as per the Capital Markets Rules, are as follows:
Director
Year when first
appointed
Notes
John C. Grech
2004
Chairman
Masaud M.J. Hayat
2013
Vice Chairman
Rabih Soukarieh
2013
Edmond Brincat
2017
Independent Director
Hussain Abdul Aziz Lalani
2017
Sunny Bhatia
2023
Teuta Bakalli
2024
Independent Director
Samer Abbouchi
2024
Simon Jethro Lay
2025
Executive Director - Appointed on 1 August 2024. Approved by Regulator on 6 March 2025.
FIMBank Group Annual Report & Financial Statements 2025
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Other than for their involvement in Board Committees as described below, all Directors hold office in a non-executive capacity with the exception
of Mr. Simon Jethro Lay who has been appointed an Executive Director and the GCEO of the Bank for which regulatory approval was obtained on 6
March 2025.
The Board considered and resolved that all Directors meet the requisites for them to be deemed independent in view of the fact that all Directors
signed a written declaration of independence prior to the publication on this Annual Report. This decision was based on the representations given
by the individual Directors, including those with a shareholding in the Bank or associated with entities having a shareholding in the Bank or who
have served on the Board for more than twelve consecutive years, which does not in any way impair these Directors’ ability to consider appropriately
the issues which are brought before the Board. In terms of Principle 3.4, each Director has confirmed in writing to the Board that he/she undertook:
• to maintain in all circumstances his/her independence of analysis, decision and action;
• not to seek or accept any unreasonable advantages that could be considered as compromising his/her independence; and
• to clearly express his/her opposition in the event that he/she finds that a decision of the Board may harm the Bank.
Another written declaration of independence shall be signed by all the Directors in 2026. In addition to the declaration provided, the Board considers
such Directors to bring a sufficiently balanced character and frame of mind to their duties and judgment that they are consequently deemed to be
independent. The Bank monitors that each Director limits the number of any directorships held in other companies. The Bank considers that the
Directors have sufficient time to perform their duties and responsibilities in terms of law. The management body of the Group is deemed to be the
Board of Directors, which is appointed in accordance with the Bank’s Articles of Association.
As at 31 December 2025, the Board of Directors consisted of:
Director
Number of directorships
held (including FIMBank
p.l.c. and its subsidiaries)
Notes
John C. Grech
4
Chairman
Masaud M. J. Hayat
1
Vice Chairman
Edmond Brincat
10
Independent Director
Hussain Abdul Aziz Lalani
1
Rabih Soukarieh
1
Samer Abbouchi
1
Simon Jethro Lay
1
Executive Director - Appointed on 1 August 2024. Approved by Regulator on 6 March 2025.
Sunny Bhatia
1
Teuta Bakalli
5
Independent Director
Directorships having an executive or non-executive role held within the same group have been counted as a single directorship.
Principles 4 and 5: Duties and proceedings of directors
The Board ensures that its level of power is known by all Directors and the senior management of the Bank. The Board also ensures that any
delegation of responsibilities and functions are clear and unequivocal. Independently of any powers and functions that the Directors may from time
to time validly delegate to management, it remains a fundamental responsibility of Directors to monitor effectively the implementation of strategy
and policy by management.
The Board of the Bank carries out its duties through a structure that starts with the strategy and policy formulated at meetings and subsequently
delegated to committees and management for implementation and execution at various levels, both functional and operational.
In the first instance, the proceedings of Directors are regulated by the Bank’s Articles of Association. Meetings of the Board for any calendar year
are normally set at the last meeting of the preceding year, so that advance preparation and daily planning for the meetings can be made. Meetings
are held at least quarterly and are formally notified by the Company Secretary at least seven days before the meeting with the issuance of the
agenda for the forthcoming meeting. Occasionally, meetings are also called at short notice or on an ad hoc basis, in which case the Directors may
decide to waive the period of notice. The agenda is accompanied by such papers and documents as are necessary to inform Directors of issues
relating to their roles and responsibilities, and in particular of the decisions they are expected to take. During the year, all Directors were duly
notified of every meeting and given the notice period. With notices of meetings, the Directors are also served with Alternate Director Appointment
Forms which, in case of non-attendance, they are invited to complete and send to the Company Secretary prior to the meeting. The Board Review
and Implementation Committee was created in order for the Board to follow up with management implementation of the resolutions passed during
Board Meetings.
FIMBank Group Annual Report & Financial Statements 2025
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The Board held four meetings in 2025. All Members of the Board were present for all four meetings except for Masaud M. J. Hayat, who was excused
in April 2025. Meetings include presentations by management, whilst other information and documentation is made available for perusal by the
Directors at their request. Members of senior management attend Board Meetings by invitation depending on the agenda content and relevance.
The Board might also request that the Meetings be attended by other employees or by professional advisors, as and when necessary. In all other
circumstances, the Directors are expected to play a full and constructive role in the Group’s affairs. As soon as possible after a Meeting, draft minutes
are circulated amongst the Members for their information. Minutes are then read and approved at the following Meeting. Directors are provided
with Board documents and can also be provided with all past minutes of Board and Committee Meetings upon request.
Board Meetings also serve as an opportunity to report on the progress and decisions of the Committees, covered under Principle 8. All Board
Committees are either a mix of Directors and management (Board Review and Implementation Committee) or include the participation of
management (Board Audit Committee, Board Nomination and Remuneration Committee, Corporate Governance Committee, Board Credit
Committee, Board Risk Committee and Board Environmental, Social and Governance Committee). Committees report to the Board on their activities
through their respective Chairman at each Board Meeting. Management reporting is also done directly to the Board at each Meeting, either by
means of an update presentation from the GCEO or usually through the Board Review and Implementation Committee. In any case, each Board
Meeting receives an update on the performance of the Bank and the Group, on known risk cases, litigation and potential problems, about key
strategic developments, including the progress of investees such as subsidiaries and joint ventures and key financial indicators that enable
performance to be measured against internal budgets, industry peers and prior financial periods.
All Directors have access to the advice and services of the Company Secretary, who is responsible to the Board for ensuring that board procedures
are complied with.
Principle 6: Information and professional development
Upon first appointment, all Directors are offered an introduction to the Bank and Group which includes a tailored induction and familiarisation by
the GCEO and the Company Secretary. This usually covers legal and statutory responsibilities as well as a good overview of the Group’s business and
activities. Access to the services of the Company Secretary and resources of the Bank, including where necessary, independent professional advice
at the Bank’s expense, are also available.
Regular updates have been given in 2025 in order for Directors to have the necessary knowledge on their duties and responsibilities and to be
informed on emerging risks, regulatory changes, and industry developments including but not limited to Environmental, Social, and Governance
(ESG), Digital Operational Resilience Act (DORA) and Compliance matters.
Moreover, the Board ensures that the GCEO maintains systems and procedures for the development and training of management and employees
generally, in order to retain the best quality employees, optimise on management and employee morale and to continue developing the succession
plan for senior management. The GCEO is responsible for the recruitment and appointment of senior management following the approval of the
Board Nomination and Remuneration Committee.
Principle 7: Evaluation of the board’s performance
Members of the Board of Directors are subject to comprehensive ‘fit and proper’ tests by the MFSA before they are formally cleared for appointment
to the Board. Annually, the Board also undertakes its own self-evaluation exercise.
Board Members complete a self-evaluation, to rate on a 5-point scale the performance of the Board in key areas covering Strategy, Business
Principles, Stakeholder Management, Risk Management and Internal Control, Performance and Measurement, Composition and Boardroom
Practice, Performance of Committees and Performance of individual Directors. Additionally, Directors quantify the hours dedicated to the Board as
a whole and to the individual Committees they are appointed to. Every Director also completes an evaluation form specifically intended to evaluate
the performance of the Committee, and the risk management aspect exercised by the respective Director when it comes to decision making.
The self-evaluation forms are then evaluated by the Board Nomination and Remuneration Committee (“BNRC”) as the Committee entrusted to
perform this function. The BNRC discusses with the Committee Chairman, who collectively are required to act on the results of the performance
evaluation process. The outcome would be to ascertain the strengths and to address the weaknesses of the Board and its Committees and to report
this to the Board itself and, where appropriate, to report it at the Annual General Meeting. This exercise began in 2013 and has been repeated
annually ever since.
FIMBank Group Annual Report & Financial Statements 2025
21
In addition to the self-evaluation of the Board and its Committees, the Bank also conducts a suitability assessment using the Skills Matrix Template
to Assess the Collective Suitability of the Members of the management Body. The latest assessment as completed in May 2025 did not indicate that
any changes were required. Details regarding the changes to Committee composition have been disclosed under Principle 8: Changes to committee
memberships during 2025.
Principle 8: Board committees
The Bank’s Articles of Association establish that the Directors may delegate certain powers, authorities and discretions to any person and/or
Committee appointed by them. The composition of such Committees, as well as the participation of Directors in them, is decided upon by the Board.
Accordingly, the Board has established the following Committees:
• Board Review and Implementation Committee
• Board Audit Committee
• Board Risk Committee
• Assets Liabilities Committee
• Board Credit Committee
• Board Nomination and Remuneration Committee (further information can be found in the Remuneration Report on page 28)
• Corporate Governance Committee
• Board Environmental, Social and Governance Committee
Board review and implementation committee
The Board Review and Implementation Committee (“BRIC”) acts as the delegated authority by the Board in overseeing the activities and
management of the Group. The Board Review and Implementation Committee terms of reference are included in the Board Review and
Implementation Committee Charter.
The Members of the Board Review and Implementation Committee as at 31 December 2025 are the following:
John C. Grech (Chairman)
Hussain Abdul Aziz Lalani (Vice Chairman)
Edmond Brincat (Member)
Simon Jethro Lay (Non-Voting Member)
The Board Review and Implementation Committee met on six occasions during 2025.
Board audit committee
The Board Audit Committee (“BAC”) assists the Board of Directors in fulfilling its supervisory and monitoring responsibilities, according to detailed
terms of reference included in the Board Audit Committee Charter and which reflect the requirements of the Capital Markets Rules, as well as
current best practices and recommendations of good corporate governance. The terms of reference of the Board Audit Committee, as detailed in
the Board Audit Committee Charter include:
• the monitoring of the financial reporting process, including the audit of the annual and consolidated accounts;
• the monitoring of the effectiveness of the Group’s internal control, internal audit, compliance and risk management systems;
• the maintenance of communication on such matters between the Board, management, External Auditors, and the Internal Audit and Compliance
functions;
• the monitoring and reviewing of the External Auditor’s independence, and in particular, the provision of additional services to the Bank;
• the monitoring and reviewing of proposed transactions by the Group with related parties; and
• the performance of the Group’s Internal Audit and Compliance functions.
It is the responsibility of the Board Audit Committee to recommend the appointment of the Statutory Auditor in line with the Capital Markets Rules
5.127.6 and in accordance with Article 16 of the Statutory Audit Regulation. The Board Audit Committee also considers the nature of related party
transactions, vets and approves them. Both the Board Audit Committee’s and the Head of Internal Audit’s terms of reference clearly stipulate their
independence from other Board Committees and management, and such independence is also acknowledged by external regulatory verification.
The Head of Internal Audit has direct access to the Board Audit Committee Chairman at all times and attends all meetings. The Group Chief
Compliance Officer also has direct access to the Board Audit Committee Chairman and attends most meetings. In addition, the composition of the
Members of the Board Audit Committee includes two individuals who are also Members of the Board Risk Committee.
FIMBank Group Annual Report & Financial Statements 2025
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The Members of the Board Audit Committee as at 31 December 2025 are the following:
Edmond Brincat (Chairman & Independent Director)
Hussain Abdul Aziz Lalani (Vice Chairman)
Teuta Bakalli (Member & Independent Director)
In line with Capital Markets Rules, the Chairman of the Board Audit Committee is appointed by the Board of Directors. With reference to Capital
Markets Rule 5.117.3, which states that “at least one member of the audit committee shall be competent in accounting and/or auditing”, the Bank
notes that all Members of the Board Audit Committee are designated as competent in auditing and/or accounting as per the qualifications listed
hereunder.
Mr. Edmond Brincat joined the GO Group in 1999, part of the team entrusted to set up and launch Go Mobile, Malta’s second mobile operator and
in 2006 he was appointed as the Group’s Chief Financial Officer, a position he held until 31 January 2018. Between 2018 and 2023, Mr. Brincat
served as the CEO of SmartCity (Malta), a subsidiary of Dubai Holding LLC. Mr. Edmond Brincat obtained a Bachelor of Arts degree in accounts from
the University of Malta in 1991 and is a Certified Public Accountant and a Fellow of the Malta Institute of Accountants.
Mr. Hussain Abdul Aziz Lalani is the Chief Executive Officer of United Gulf Bank (“UGB”), Bahrain and has worked extensively with the Board of
Directors on advisory transactions in his previous capacity as UGB’s Chief Financial Officer. Mr. Hussain Abdul Aziz Lalani is a Chartered Accountant
and a Certified Information Systems Auditor and holds a Bachelor of Commerce degree from the University of Karachi, Pakistan.
Ms. Teuta Bakalli has over 20 years of experience in regulated financial markets including fintech, cleantech, asset management, insurance and
investment banking. Ms. Bakalli was the Chief Financial Officer of the eCommerce division of WorldPay Inc., and the European Chief Financial Officer
of Pepper Europe. She also held roles at Schroders, Credit Suisse First Boston and Barclays Capital before she joined Willis and Vanguard Europe as
a Financial Director. Ms. Bakalli has resided in the digital economy hotspot of Malta since 2016 where she founded Cleantech360, a company which
offers ESG strategy and business consulting to the cleantech industry. As part of her involvement in this sector, she has worked on numerous
renewables and sustainability projects, including those which leverage blockchain technology. Ms. Bakalli sits on several boards and is an ongoing
contributor to the ACCA (Global Accounting Body) as well as a member of the Global Forum for Sustainability. She was admitted as a Fellow Chartered
Certified Accountant in 2005.
The Bank considers that the Committee Members as a whole have the relevant competence as required by the Capital Markets Rule 5.118, having
evaluated the balance of knowledge, skills, diversity and experience of the members of the Committee, thereby ensuring that they have the requisite
experience, personal abilities and integrity and that they adhere to sound professional practices.
All Members of the Board Audit Committee have signed a written declaration of independence. In effect, the Board of Directors of the Bank consider
these Members to be independent. Furthermore, the Committee Members as a whole, have the competence relevant to the sector in which the
Bank is operating.
The Board Audit Committee normally requests members of management to attend its Meetings for selective items of the respective agenda.
The Board Audit Committee held ten meetings during 2025 and all Members were present for all ten meetings. The Group Head of Internal Audit
was also invited to attend and attended all ten meetings. The External Auditors were invited to seven Board Audit Committee Meetings and were
only present for the agenda items which considered and discussed the 2025 Statutory External Audit (one meeting in January 2025), 2024 Annual
Report and Management Letter (two meetings in April 2025), Interim Report for the period ended 30 June 2024 (two meetings in August 2025),
Statutory Audit for Financial Year ending 31 December 2025 (November 2025) and presentation of Audit Plan 2025 (December 2025).
Board risk committee
The Board Risk Committee (“BRC”) is responsible for overseeing the Group’s risk management strategy, systems and policies, and for recommending
appropriate risk appetite parameters for approval by the Board of Directors. The Board Risk Committee is also responsible for the oversight of
operational, market, reputational and legal risk matters, as set out in further detail in Note 4.
Hussain Abdul Aziz Lalani (Chairman)
Teuta Bakalli (Member)
Samer Abbouchi (Member)
During 2025, the Board Risk Committee met on nine occasions.
FIMBank Group Annual Report & Financial Statements 2025
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Assets liabilities committee
The Assets Liabilities Committee is composed of representatives of senior management, vested with the power to make decisions. As at 31st
December 2025, the voting members of the Assets Liabilities Committee were the following:
Simon Jethro Lay (Chairman)
Zbigniew Makula (Vice-Chairman)
Ronald Haverkorn (Member)
Juraj Beno (Member)
Modesto Luengo (Member)
Mr. Jason Zammit (Head of Real Estate & Marketing), Mr. Chris Trapani (Head of Retail and Corporate Banking), Ms. Tiziri Hamidouche (Deputy Head
of Treasury), Ms. Corinne Lanfranco (Head of Financial Institutions & Deposits), Mr. Simon Vickery (Head of Non-Credit Risk Management) and Mr.
Clinton Bonnici (ALCO Secretary) are permanent invitees of the ALCO.
During 2025, the Assets Liabilities Committee met on five occasions.
Board credit committee
The Board Credit Committee (“BCC”) is a Committee appointed by the Board of Directors of FIMBank. The Board Credit Committee is directly
responsible and accountable to the Board. The Board may delegate any of its authorities and powers in relation to the BCC to the Board Risk
Committee. The Board Credit Committee’ main powers and duties are to:
• review credit applications and approve credit limits and specific transactions, up to the legal lending limit of the Bank and within the guidelines
specified in the Group’s Credit Policy and Procedures; and
• review and consider for approval country limit applications, within the guidelines specified in the Group’s Credit Policy and Procedures.
The Board Credit Committee Members as at 31 December 2025 are the following:
John C. Grech (Chairman)
Rabih Soukarieh (Vice Chairman)
Samer Abbouchi (Member)
Mr. Simon Jethro Lay (GCEO) and Mr. Modesto Luengo (GCRO) are permanent invitees of the Board Credit Committee.
During 2025, the Board Credit Committee met on four occasions. This notwithstanding the Board Credit Committee approved via circulation
transactions which did not require a physical meeting for the purpose of assessment of the relevant credit lines.
Nomination and remuneration committee
The Board Nomination and Remuneration Committee (“BNRC”) is currently composed of three members, one of whom is an independent Director.
The Board Nomination and Remuneration Committee is governed by the BNRC’s Charter as may be amended by the Board in line with the relevant
laws and regulations. The Charter establishes the authority and responsibilities conferred by the Board to the Board Nomination and Remuneration
Committee in line with Appendix 5.1 (8) (A) & (B) of the Code of Principles of Good Corporate Governance. The responsibilities of the Board
Nomination and Remuneration Committee include having oversight, informing, updating and deciding and/or making recommendations to the
Board on all matters regarding nomination and remuneration. These include:
• presenting recommendations to the Board regarding nomination to the Board’s membership in accordance with approved policies, standards,
and nomination regulations for the Board’s membership;
• performing an annual review of the needs required with regard to suitable skills for Board membership and performing an annual review of the
Board of Directors’ structure and presenting recommendations on the changes which can be performed in accordance with the Bank’s strategy;
• performing an annual evaluation of the Board’s overall performance and the performance of each Member and the Board Committees;
• conducting as and when required, including on an annual basis, suitability assessments of prospective/appointed Directors, officers holding a
senior management position and key function holders;
• preparing/reviewing the Group Remuneration Policy and the Directors Remuneration Policy in line with applicable regulations and legislation
and the principles of good corporate governance;
• overseeing the implementation and compliance with the Group Remuneration Policy and the Directors Remuneration Policy;
FIMBank Group Annual Report & Financial Statements 2025
24
• assessing the mechanisms adopted to ensure that the remuneration process properly takes into account all types of risks, liquidity and capital
levels and that it promotes sound and effective risk management and is in line with the business strategy, objectives, corporate culture and
values, risk culture and long-term interest of the institution;
• monitoring the level and structure of Directors’ Remuneration by reviewing and updating when necessary, the individual remuneration to be
attributed to Directors, ensuring that they are consistent with the Directors Remuneration Policy as approved by the Annual General Meeting;
• devising appropriate and annually reviewing remuneration packages which are: fair; equitable, gender neutral and in line with industry
benchmarks and the long-term interests of the Bank as needed to attract, retain and motivate Directors, the GCEO and Executives that hold the
knowledge, skills and abilities to lead the FIMBank Group;
• approving on an annual basis, the Group’s individual distribution of salary increases, promotions and bonuses, as may be recommended by the
GCEO;
• preparing a Remuneration Report for inclusion in the Annual Report; and,
• reviewing and assessing at least annually the adequacy of the BNRC Charter and confirming that all the responsibilities set out in the Charter
have been duly executed.
Details regarding the Remuneration Policy and remuneration related matters have been disclosed under the Remuneration Policy and Remuneration
Report on page 28.
The Board Nomination and Remuneration Committee Members as at 31 December 2025 are the following:
Masaud M.J. Hayat (Chairman)
Edmond Brincat (Vice Chairman)
Sunny Bhatia (Member)
Dr. John C. Grech (FIMBank Chairman) and Mr. Simon Jethro Lay (GCEO) are permanent invitees of the Board Nomination and Remuneration
Committee.
During 2025, the Board Nomination and Remuneration Committee met on four occasions with all Members attended the meetings.
Corporate governance committee
The purpose of the Corporate Governance Committee (“CGC”) is to review the Bank’s internal delegations, policies and procedures to ensure
compliance with legislative and regulatory requirements and alignment to the industry’s best practice.
The Corporate Governance Committee Members as at 31 December 2025 are the following:
John C. Grech (Chairman)
Sunny Bhatia (Vice Chairman)
Edmond Brincat (Member)
During 2025, the Corporate Governance Committee met on three occasions.
Board environmental, social and governance committee
The Board Environment, Social and Governance Committee ("BESG") is responsible for assisting the Board in setting the Bank’s Environmental Social
and Governance (“ESG”) policies and strategy, and to follow-up on the Bank’s execution of these, via periodic reviews, as well as to enhance the
effectiveness of the Board’s supervision over any matters relating to ESG. The Board Environmental, Social and Governance Committee terms of
reference are included in the Board Environmental, Social and Governance Committee Charter.
The Members of the Board Environmental, Social and Governance Committee as at 31 December 2025 are the following:
Teuta Bakalli (Chairperson)
Hussain Abdul Aziz Lalani (Member)
Simon Jethro Lay (Member)
The Board Environment, Social and Governance Committee met on three occasions during 2025.
Changes to committee membership during 2025
There were no changes to committee memberships during 2025.
FIMBank Group Annual Report & Financial Statements 2025
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Principles 9 and 10: Commitment to institutional shareholders, an informed market and
transparency in dealings by directors, management and staff
The Chairman arranges for all Directors including the Chairmen of all the Committees to be available to answer questions at the Annual General
Meeting. All eligible shareholders are served with a notice to attend the Annual General Meeting, which is held normally during the first half of the
year. The notice contains all the resolutions proposed for approval by the Annual General Meeting and, as necessary, notes accompanying such
resolutions. Pursuant to the Companies Act, notices are delivered to shareholders at least fourteen clear days before the date of the Annual General
Meeting. Advance notification of the resolutions proposed for approval is also given by way of a Company Announcement as soon as these are
decided and approved, normally at the same Board Meeting that approves the Annual Report and Financial Statements. The Board also considers
the Annual Report to be an effective document which, in addition to the statutory disclosures, contains detailed information about the Group’s
performance. Moreover, the Board ensures that the Annual General Meeting serves as a medium at which information is communicated to
shareholders in a transparent and accountable manner. Additionally, the Bank holds meetings from time to time with financial intermediaries and
financial market practitioners to disseminate information about the Group’s progress, activities and financial performance. These meetings are
usually organised to follow the publication of the half yearly and annual financial results as well as in connection with other Group developments
and events. Procedures are in place to resolve conflicts between minority shareholders and controlling shareholders.
The Board complies with the provisions of the Bank’s Memorandum and Articles of Association, as well as all legislation, rules and regulations that
require it to maintain a fair and informed market in the Bank’s equity securities. It discharges its obligations by having in place, formal procedures
for dealing with potentially price-sensitive information and ensuring the proper conduct of its officers and employees in that regard. Regular contact
with shareholders and the general market is maintained through Company Announcements, which are issued in conformity with the obligations
arising from the Capital Markets Rules. During 2025 the Bank issued ten announcements.
The Board also complies with the provisions of the Bank’s Articles of Association insofar as minority rights are concerned. In accordance with Article
65 of the Bank’s Articles of Association, minority shareholders may convene an Extraordinary General Meeting, in the same manner, as nearly as
possible, as that in which meetings may be convened by the Directors.
The Bank also maintains a presence on the web through www.fimbank.com which, includes an informative and comprehensive Investor Relations
section that contains, amongst other things, all Company Announcements, Annual General Meeting information and regulated information.
The FIMBank Financial Instruments Internal Code of Dealing which has been drawn up in accordance with the requirements of the Capital Markets
Rules contains dealings restriction guidelines and reporting procedures to be observed by Directors, management and employees when dealing, or
prospecting to deal, in the Bank’s equity securities. Directors, management and employees are also notified by the Company Secretary of their
obligations to observe the restricted ‘time-windows’ accompanying the publication of half yearly and annual financial results during which no
dealings in the Bank’s equity securities are allowed.
Control by any shareholder, whether direct or indirect, and any potential abuse thereof, is regulated by the Banking Act and Rules issued thereunder.
The Act and such Rules provide mechanisms for, and obligations on, persons intending to acquire control, as well as on all Directors and
management, to notify and report to the Supervisory Authorities in such eventuality. There are additional obligations on Directors in terms of the
Capital Markets Rules and there is good communication in place between the management, the Company Secretariat and the Board to ensure that
any issues are flagged and acted upon appropriately.
Principle 11: Conflicts of interest
Directors' primary responsibility is to act in the interest of the Bank and its shareholders as a whole irrespective of who appointed them to the
Board. While the overall tone for instilling a strong culture about the proper management of conflicts of interest is set at the top, situations of
potential conflicts of interest with Board Members are in the first instance specifically regulated by Clauses 119 and 120 of the Bank’s Articles of
Association. In terms of the aforementioned Articles of Association, in the event of a conflict-of-interest situation, real or potential, arising in
connection with any matter, the interest has to be declared. In particular, the Director concerned refrains from taking part in proceedings relating
to the matter and his vote is excluded from the count of the decision. The minutes of Board Meetings, as well as those of Board Committees,
invariably shall include a suitable record of such declaration and of the action taken by the individual Director concerned. In the event that such
steps do not eliminate the grounds for conflict then the Director should consider resigning. Similar arrangements apply to management in the course
of the conduct of their duties at Board Committees. Besides, where Directors and management have related party involvements, these are reported
and it is an integral part of the Board Audit Committee’s terms of reference to provide oversight on related party transactions.
FIMBank Group Annual Report & Financial Statements 2025
26
The number of shares held in the Bank by Directors directly in their name as at 31 December 2025 is as follows:
John C. Grech (Chairman) * 1,760,000
Edmond Brincat Nil
Hussain Abdul Aziz Lalani * Nil
Masaud M.J. Hayat (Vice Chairman) * Nil
Rabih Soukarieh * Nil
Samer Abbouchi * Nil
Simon Jethro Lay Nil
Sunny Bhatia * Nil
Teuta Bakalli Nil
‘ * ‘ Aside from these direct interests in the shareholding of the Bank, these Directors are considered to be associated with companies that hold a
beneficial interest in the Bank’s shareholding. No shareholder is entitled to any automatic right to nominate or appoint a Director on the Board.
Details of outstanding loans, guarantees or similar facilities made available to related parties or beneficial interests thereof, including Directors, are
disclosed in Note 45 of the Notes to the Financial Statements.
Principle 12: Corporate social responsibility
The Board of Directors and senior management of the Bank recognise that social, environmental, and ethical conduct are critical to both the Bank’s
reputation and the well-being of the communities in which it operates. Corporate Social Responsibility (“CSR”) forms a cornerstone of the Bank’s
culture, reflecting its commitment to people, the environment, and ethical governance. The Bank’s CSR strategy is firmly rooted in its core values
and reflects its dedication to clients, employees, shareholders, and the communities in which it operates. The Bank actively contributes to social
and environmental development while championing sustainable practices and cultural preservation. These efforts underscore its broader mission
to integrate responsibility into every aspect of its operations.
The Bank places significant emphasis on operating ethically and fostering a workplace that supports equal opportunities, professional growth, and
a healthy work-life balance for its employees. It invests in learning and development programs, ensuring that employees not only excel in their roles
but also embody the highest ethical standards. Open communication and inclusivity are at the heart of the Bank’s culture, promoting a sense of
shared purpose and trust throughout the organisation. In its interactions with the community, the Bank is committed to initiatives that enhance
social progress and environmental stewardship. By regularly reviewing its operations, infrastructure, and procurement policies, the Bank seeks to
minimise its carbon footprint and reduce its environmental impact. Through these commitments, the Bank strives to create long-term value for its
stakeholders while contributing meaningfully to a sustainable and inclusive future. Further details about the CSR initiatives undertaken by the Group
in 2025 are provided in the GCEO’s Message to shareholders.
Part 2: Non-compliance with the principles
Principle 2.3: Chairman and chief executive
The existing Chairman of the Board of Directors is not an independent member in terms of the Capital Markets Rules. This notwithstanding, the
Bank considers the non-compliance with this Principle not to be of concern in view of the fact that Dr. John C. Grech has signed a written declaration
whereby he has declared that he undertakes to maintain in all circumstances his independence of analysis, decision and action, not to seek or accept
any unreasonable advantages that could be considered as compromising his independence and to clearly express his opposition in the event that
he finds that a decision of the Board may harm the Bank.
Principle 4: Succession policy for directors
Capital Markets Rule 4.2.7 calls on the Directors to develop a succession policy for the future composition of the Board, and ‘particularly the
executive component thereof, for which the Chairman should hold key responsibility’. The BNRC, discussed Directors’ succession planning during its
August meeting. This discussion revolved around an updated market assessment as presented by the BNRC Secretary, after reviewing the global
employment market via internet-based searches.
FIMBank Group Annual Report & Financial Statements 2025
27
The market research was guided by the following criteria:
• international experience and experience in multi-cultural environments;
• having held diverse senior management roles in the financial services;
• having held leadership roles;
• Information Technology and/or Environmental, Social and Governance experience; and
• Commitment to diversity.
The BNRC also discussed the findings from this market assessment and concluded that there are a number of valid profiles both locally and overseas,
that suit the aforementioned criteria.
Principle 8: Nomination and remuneration committee
The manner in which the Directors are nominated for appointment follows the procedure set out in the Articles of Association, i.e. any nomination
must be seconded by a Member or Members who in the aggregate holds at least twenty-thousand (20,000) shares. This process is also rendered
public with an announcement in the Maltese press, usually in the first quarter of the financial year and in good time before the Annual General
Meeting, which allows at least ten business days for any nomination to be made to the Company Secretary.
The current Chairman of the BNRC is not an independent member in terms of the Capital Markets Rules, as set out in terms of Principle 8.A.1 of the
Code of Principles of Good Corporate Governance. This notwithstanding, the Bank considers the non-compliance with this Principle not to be of
concern in view of the fact that the Chairman of the BNRC has signed a written declaration whereby he has declared that he undertakes to maintain
in all circumstances his independence of analysis, decision and action. Furthermore, the Vice Chairman of the BNRC is deemed to be an Independent
Director in terms of the Capital Market Rules.
Internal control
The Board is ultimately responsible for the identification and evaluation of key risks applicable to the different areas of the business of the Group,
and for ensuring that proper systems of internal control are in place. The Board has delegated management with the task of creating an effective
control environment to the highest possible standards. The Internal Audit function performs periodic audits to specifically test compliance with
policies, standards and procedures and the effectiveness of the internal control environment within the Group. To ensure the effectiveness of the
internal systems of control the Head of Internal Audit reviews and tests such systems independently from management, adopting a risk-based
approach. The Internal Auditor reports to the Board Audit Committee, however, the Chairman of the Board of Directors is copied with all Internal
Audit Reports issued.
The Board has identified key features within the Group’s environment of internal controls to ensure compliance with the Principles. The
management is responsible for the identification and evaluation of key risks applicable to the respective areas of business. The Board receives
regular reports from management giving detailed and comprehensive analysis of financial and operational performance, including variance analysis
between budgeted and actual figures, activities and prospects.
Capital markets rule 5.97.5 and rule 5.97.8
Capital Markets Rule 5.97.5 and Rule 5.97.8 are not applicable. Whilst Capital Markets Rule 5.97.5 is not applicable, this information is found in the
Directors’ Report.
It is also hereby declared that the contents of the Directors’ Report and of this Statement of Compliance with the Principles of Good Corporate
Governance cover the requirements of the provisions of Capital Markets Rule 5.97.
Approved by the Board of Directors and signed on its behalf by Dr. John C. Grech (Chairman) and Mr. Masaud M.J. Hayat (Vice Chairman) on 26
March 2026 as per Director’s Declaration on ESEF Annual Financial Report submitted in conjunction with the Annual Report and Financial
Statements 2025.
FIMBank Group Annual Report & Financial Statements 2025
28
Remuneration report
For the year ended 31 December 2025
This section incorporates the Statement of the Board Nomination and Remuneration Committee and the Directors’ Remuneration Report as required
by Chapters 5 and 12 of the Capital Markets Rules, respectively.
Statement of the board nomination and remuneration committee (as per
section 8 of the code of principles of good corporate governance, appendix 5.1 of the capital
market rules)
Terms of reference and membership
The Board Nomination and Remuneration Committee (“BNRC”) is responsible for ensuring that the Directors and Executive Management of FIMBank
have the appropriate mix of skills, qualifications and experience necessary to fulfil their supervisory and management responsibilities. The BNRC
also reviews the remuneration of the Board of Directors and that of Executive Management on an annual basis and ensures that it is in line with the
EBA Guidelines on Sound Remuneration Policies EBA/GL/2022/04, Banking Rule 21 on Remuneration Policies and Practices and principles of good
governance.
From 1 January 2025 up to the Annual General Meeting (“AGM”) held on 13 May 2025, the BNRC was composed of three members: Mr. Masaud
M.J. Hayat (Chairperson); Mr. Edmond Brincat (Vice-Chairperson and Independent Director); and Mr. Sunny Bhatia (Member). As at 31 December
2025, the BNRC composition remained unchanged. The BNRC has one permanent invitee, namely Dr. John C Grech, the Chairperson of the Board.
Mr. Simon Jethro Lay, the Group Chief Executive Officer (“GCEO”) is also invited to attend the meetings. Dr. John C. Grech, in his capacity as
Chairperson of the Board, attended all but one of the BNRC meetings held in 2025, for which he was duly excused. Mr. Simon Jethro Lay, in his
capacity as Executive Director and GCEO attended all the BNRC meetings held in 2025. The Group Chief Human Resources Officer (“GCHRO”) acted
as Board Committee Secretary.
Meetings
Members Attended
Masaud M.J. Hayat (Chairperson) 4
Edmond Brincat (Vice Chairperson & Independent Director) 4
Sunny Bhatia (Member) 4
The Committee met four times during the period under review with all Members attending all the meetings.
The following matters were discussed and, or determined:
a. group appointed Directors;
b. chairperson’s role and performance;
c. Directors’ remuneration;
d. Board of Directors evaluation, Director’s self-assessment, Board Committees self-assessment and Time Commitment assessment;
e. composition of Board Committees;
f. BNRC Charter: annual review and checklist;
g. Group Remuneration Policy and Directors’ Remuneration Policy;
h. GCEO, Executive Management, Key Function Holders and subsidiary CEO’s performance;
i. Group salary review, promotions, bonus allocation and out of cycle increases/payments;
j. enhancement of the performance appraisal ratings framework, transitioning from a 4-point to a 5-point scale;
k. organisational structure changes, headcount and recruitment;
l. succession planning for all entities;
m. annual market assessment related to Board succession planning;
n. control functions: independence, recruitment, succession and performance;
o. Remuneration Policy Statement, Statement of the BNRC, Directors’ Remuneration Report as per Capital Market Rules 12.26k, and Pillar 3
Disclosures inclusive of the Identified Staff List;
p. appointment of Group Chief Commercial Officer;
q. suitability assessment of the Board, the GCEO and the Key Function Holders;
r. Human Resources Policies.
FIMBank Group Annual Report & Financial Statements 2025
29
Remuneration statement
The BNRC has the role of making recommendations to the Board of Directors on remuneration. Decisions taken by the BNRC are presented by the
BNRC Chairperson to the Board. The guiding principle, as outlined in the Group Remuneration Policy and the Directors’ Remuneration Policy, is that
the remuneration structure is such that it attracts, incentivises and retains a high-performing workforce while remaining aligned to FIMBank’s long-
term strategy, risk appetite, sustainable performance, good corporate governance, regulatory compliance and long-term value creation for
shareholders.
Across FIMBank, remuneration is based on the below principles:
• sound and effective risk management to discourage risk-taking that exceeds the Bank’s risk appetite;
• non-discriminatory practices, consistent with the acknowledged principles of diversity as listed in FIMBank’s Diversity Policy. This includes the
principle that remuneration is gender neutral and thus all employees, independently of their gender are equally remunerated for work of equal
value. True merit determines all remuneration related decisions;
• internal equity, with the application of fair distinction based on individual employee performance;
• external parity through an annual alignment exercise with local compensation data to ensure that the Bank’s remuneration packages are
competitive and in line with industry standards; and
• affordability and sustainability, ensuring that the remuneration policy is in line with the Bank’s business strategy, business objectives, values and
long-term interests and incorporates measures to avoid conflicts of interest.
Remuneration policy
The Group Remuneration Policy is aligned with the principles emanating from the EU’s Capital Requirements Directive (“CRD”), particularly in
relation to the monitoring of Identified Staff. As a basis for the compilation of the list of Identified Staff, the Bank refers to:
• the Commission Delegated Regulation (EU) 2021/923 (“MRT Regulation”);
• the EBA Guidelines on Sound Remuneration Policies (EBA/GL/2021/04) (“EBA Remuneration Guidelines”) as transposed into Banking Rule 21 on
Remuneration Policies and Practices (BR/21/2022) (“Banking Rule 21”); and
• Article 92(3) of Directive 2013/36/EU (“CRD IV"), as amended from time to time, including by Directive (EU) 2019/878 (“CRD V”) and as
transposed into Banking Rule 21.
Identified Staff are employees who in their role and as part of their responsibilities are material risk takers (meaning that their professional activities
have a material impact on the Bank’s risk profile). The MRT Regulation establishes the qualitative and quantitative criteria to identify staff who are
material risk takers.
The Bank’s Identified Staff includes the Management Body in its Management or supervisory function and/or Senior Managers. The Management
Body in its management function includes the GCEO, the Deputy CEO and Officers of the Bank who hold the grade of Executive Vice President or
higher at FIMBank p.l.c. (the “Executive Management”). The Management Body in its supervisory function comprises the Directors of the Bank’s
Board of Directors. In relation to majority owned subsidiaries of the Bank, Identified staff include the respective Chief Executive Officers (“CEOs”),
as they represent the sole function reporting directly to the GCEO, as well as other officials who are material risk takers.
Currently, the Executive Director holds the position of GCEO. Members of the Executive Management of the Bank are engaged on either a definite
or an indefinite contract with varying notice periods, all of which are in line with locally applicable legislation. Directors in their Supervisory function
are approved for appointment by the AGM and pursuant to appointment letters issued by the Company Secretary following regulatory approval,
where applicable. Their appointment is for a period of one year or otherwise, as it may be renewed at the subsequent AGM of the Bank. Directors
appointed in the interim between one AGM and another, are always subject to regulatory approval and their appointment expires at the first
upcoming AGM, unless it is renewed by the same AGM.
The contracts of Directors and Executive Management do not include provisions for termination payments and other payments linked to early
termination, except for those required by law.
During 2025, the Group Remuneration Policy was subject to a number of minor amendments and refinements aimed at a more concise policy.
FIMBank Group Annual Report & Financial Statements 2025
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Remuneration structure for non-executive directors
The total package payable to Non-Executive Directors consists of a fixed fee which is supplemented by additional fees payable inter alia with respect
to any memberships and/or chairpersonships of the different Board Committees. The fees also vary between Independent and Non-Independent
Directors. Board directorship fees to remunerate the Independent Directors are higher than those of Non-Independent Directors. This is mainly for
two reasons: the additional responsibility that Independent Directors have due to their required independence and because they do not receive any
other remuneration for employment positions within the KIPCO Group. The fees are reviewed annually in line with market conditions and the
maximum allocated budget requires the approval of the AGM of the Bank.
Remuneration structure for executive directors and executive management
The remuneration structure of Executive Directors and Executive Management (together referred to as the “Executives”) comprises both fixed and
variable remuneration and is intended to attract, incentivise and retain a high-performing workforce while remaining aligned to FIMBank’s long-
term strategy, risk appetite, sustainable performance, good corporate governance, regulatory compliance and long-term value creation for
shareholders. All compensation structures including those of the branches and the subsidiaries of FIMBank located in third countries are aligned
with the requirements emanating from the CRD unless local legislation in the respective jurisdiction mandates otherwise.
The BNRC ensures that while its remuneration practices are compliant with existing EU/Maltese Directives and Regulations, including CRD and the
Capital Requirements Regulation (“CRR”), the remuneration packages reflect industry benchmarks. This makes it possible for the Bank to attract and
retain Executives with the right qualities and skills for the proper management of the Bank as well as the proper execution of the strategy as laid
down by the Board of Directors. Unless the current economic scenario changes materially, no new significant changes to the Group Remuneration
Policy are envisaged for the financial year ending 31 December 2026.
The remuneration components for Executives are:
• fixed remuneration (including fringe benefits); and
• variable remuneration.
These components are combined to ensure an appropriate and balanced remuneration package that reflects the employee’s grade and professional
activity. Executives are not entitled to discretionary supplementary pension or early retirement schemes. The following tables describe the element
and purpose of Executives’ compensation and how each element operates, as well as the maximum opportunity of each element and any applicable
performance measures.
FIMBank Group Annual Report & Financial Statements 2025
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Fixed remuneration
Element and purpose of
remuneration
Operation
Maximum opportunity
Performance measures
Base salary
To provide the basis of
market-competitive overall
remuneration package. It
provides a fixed
remuneration which is
sufficient to recruit and
retain individuals of the
necessary calibre.
This is determined by:
a. the role and grade of the individual director;
b. the base salary structure for other employees across
FIMBank; and
c. external factors such as economic conditions and market.
The base salary of Executives engaged on indefinite contracts is
reviewed annually or when required to include any statutory
payments.
The fixed remuneration component of Executives engaged on
definite or fixed-term contracts is as stipulated in the contract
of employment and compensation therein is reviewed if and
when the definite contract is renewed for a further term/s. The
Executive is entitled to any newly introduced statutory
payments or adjustments to existing ones.
When and where applicable the base salary of the Deputy CEO may also include
annual increases. These are recommended by the GCEO and require approval
by the BNRC, including the effective date.
No salary increases will be awarded when the Deputy CEO joins after
September of the preceding year or when the Deputy CEO is rated ‘1’ in the
appraisal.
Exceptional increases for the Deputy CEO during the year, require the
recommendation of the GCHRO and GCEO to BNRC and thereafter a priori
approval of the BNRC. Employment contracts may contain anniversary
payments whereby, at fixed annual intervals, amounts are paid to the individual
Executives, as applicable. Such payments also require the a priori approval of
the BNRC.
The salary of the GCEO is reviewed by the BNRC if and when the definite
contract is renewed for a further term/s.
Exceptional one-time payments may be paid to Executives for working on
specific projects during/outside office hours which go beyond the employee’s
role.
The base salary does not vary
according to performance of
the individual, the entity and
FIMBank or results achieved.
This is according to the
FIMBank pay structure which
is approved annually by the
BNRC.
Deviations from the pay
structure are subject to a
priori approval by BNRC.
Fixed allowances and
benefits
To ensure business
continuity and assist
Executives in carrying out
their duties efficiently.
The benefits may include different cash allowances and/or non-
cash benefits as detailed in the respective contract of
employment and/or as may be applicable depending on the role
of the individual and the employing entity.
When and where applicable, the base salary is supplemented by fixed benefits.
These may commence either on employment and/or after probation, as
determined in the respective contract of employment and/or as may be
applicable depending on the role of the individual and the employing entity.
N/A
FIMBank Group Annual Report & Financial Statements 2025
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Variable remuneration
Element and purpose of
remuneration
Operation
Maximum opportunity
Performance measures
Performance bonus
To motivate Executives in
maximising individual,
departmental and FIMBank’s
performance.
Executives may be entitled to a performance bonus. Employee
performance is measured in the interim and annual
performance appraisal which is detailed in the Bank’s
Performance Management Policy and Procedure. If the variable
remuneration to be awarded amounts to more than €50,000 in
one calendar year or this represents more than one third of
his/her annual remuneration, at least 50% of the variable
remuneration should be paid in shares. Note that this
restriction on total annual variable remuneration would not
apply in the case that a derogation is applicable (see ‘Other
Requirements: Derogation’ on page 37).
Executives who join after September of the preceding year or who are rated ‘1’
will not be considered for any variable compensation.
Deferred performance bonus may be awarded at the discretion of the BNRC.
Such bonus would be linked to a 3-year vesting period.
Any Performance Bonus is dependent on the performance rating of the
Executive, the team’s performance, the entity and FIMBank’s performance. The
individual rating is based on the Executive’s overall performance which is
centred on core behaviours and performance targets. In term of core
behaviours, all employees including Identified Staff, as defined in the Group
Remuneration Policy, are assessed for leadership, people management,
personal effectiveness, creativity, innovation, holistic approach, teamwork,
communication and company values.
A performance bonus relates
to the Executive’s
performance as defined in
the multiyear assessment
where applicable and the
cash component is awarded
once yearly, generally by
April.
Exceptional bonus
To motivate Executives in
maximising individual,
departmental and FIMBank’s
performance.
Executives may be entitled to an exceptional bonus to reward
remarkable performance in the individual’s role which goes
beyond the individual’s call of duty.
Exceptional bonuses up to 15% of fixed remuneration for the Deputy CEO are
approved by the GCEO and GCHRO and are ratified a posteriori by the BNRC.
Exceptional bonuses in excess of 15% of fixed remuneration for the Deputy CEO
and exceptional bonuses for the GCEO require the a priori approval of the
BNRC.
N/A
FIMBank Group Annual Report & Financial Statements 2025
33
Variable remuneration (continued)
Element and purpose of
remuneration
Operation
Maximum opportunity
Performance measures
Retention bonus
To ensure business continuity
and assist Executives in
carrying out their duties
efficiently.
Executives may, in addition to the performance bonus, be
entitled to a retention bonus on condition that the employee
remains in employment for a period of 12 months or more
from the date of award as defined in the retention addendum
to the contract of employment.
Retention bonuses up to 15% of fixed remuneration for the Deputy CEO are
approved by the GCEO and GCHRO and are ratified a posteriori by the BNRC.
Retention bonuses in excess of 15% of fixed remuneration for the Deputy CEO
and any retention bonuses for the GCEO require the a priori approval of the
BNRC.
Retention bonuses may be paid only in exceptional circumstances such as, for
example and without limitation, in the case of a restructuring, wind-down, after
a change in control or to ensure the completion of major projects. Retention
bonuses will not be awarded merely to compensate for performance-related
remuneration not paid as a result of insufficient performance or FIMBank’s
financial situation. Moreover, Retention Bonuses shall only be awarded if no
reasons exist that lead to a situation where the Retention Bonus shall not be
awarded, e.g. material compliance breaches, misconduct or other failures of
that staff member. Retention bonuses to Executives must be justified based on,
amongst other things, the following factors:
a. concerns relating to the risk that certain Executives may choose to leave
FIMBank;
b. the reasons why the retention of that Executive is crucial for FIMBank;
c. the consequences if the relevant Executive leaves FIMBank; and
d. whether the amount of the awarded Retention Bonus is necessary and
proportionate to retain the targeted Executive.
The retention bonus is considered in the calculation of the ratio between the
variable and fixed components of remuneration following one of the methods
specified in Banking Rule 21 and shall be established in line with applicable
legislation.
N/A
FIMBank Group Annual Report & Financial Statements 2025
34
Variable remuneration (continued)
Element and purpose of
remuneration
Operation
Maximum opportunity
Performance measures
Severance payments
To close the employment
relationship in case of
redundancy, termination by
the employer and/or of a
potential legal dispute.
Severance payments may include redundancy payments. In the
below situations, additional payments made because of the
early termination of a contract shall be considered as severance
payments:
•
a. FIMBank terminates the employment contract of the
Executive because of failure of the institution;
b. FIMBank needs to terminate the employment contract
following a material reduction of FIMBank’s activities in
which the Executive was active in or where business areas
are acquired by FIMBank without the option for current
employees to stay employed in the acquired entity; and
c. FIMBank and an Executive agree on a settlement in case of
a potential or actual employment dispute, to avoid a
decision on a settlement by the courts.
Any severance payments for the Deputy CEO, other than notice related
payments or gardening leave have to be reviewed and approved by the GCHRO,
Group Chief Risk Officer (“CRO”), Group Chief Compliance Officer (“GCCO”) and
the GCEO. This with a view to ensuring that the Bank is acting in compliance
with prevailing rules and regulations and does not reward failure. Failure is
defined as situations where an Executive is no longer considered as meeting
appropriate standards of fitness and propriety and/or is responsible for actions
which result in significant losses for FIMBank and/or acts contrary to internal
rules, values or procedures based on intent or gross negligence. Any severance
payment to the GCEO requires the a priori approval of the BNRC.
Unless stipulated by local regulation, the maximum severance payment
awarded may be of a maximum of three months’ base salary. Severance
packages in excess of the equivalent of three months’ base salary would require
the a priori approval of the BNRC.
In the event that this is extended, such extended amount would be considered
as part of the variable remuneration component for the year it was awarded.
However, it would not be taken into account for the purpose of the calculation
of the ratio of fixed to variable remuneration if it meets the definition set out
in paragraph 181 of Banking Rule 21.
N/A
FIMBank Group Annual Report & Financial Statements 2025
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Variable remuneration (continued)
Element and purpose of
remuneration
Operation
Maximum opportunity
Performance measures
Guaranteed/Sign-on bonus
To motivate Executives in
maximising individual,
departmental and FIMBank’s
performance.
FIMBank may pay out a guaranteed bonus in the first year of
employment, if applicable. Such sign-on bonus for the first year
of employment will require the approval of the BNRC.
A guaranteed bonus is exceptional and can only occur where the institution has
a sound capital base.
FIMBank does not pay out or promise to pay out any guaranteed variable
remuneration. In exceptional cases, FIMBank may at employment stage agree
to disburse a sign-on bonus. Such sign-on bonus requires the a priori approval
of the BNRC and is disbursed on a one-time conditional basis during the first
year of employment. In the event that this is awarded, such amount would be
considered as part of the variable remuneration component for the financial
year during which it was awarded. However, it is not to be taken into account
for the purpose of the calculation of the ratio between the fixed and variable
components of the total remuneration for the first performance period if the
probationary period initiates prior to the first performance period.
The sign-on bonus is exceptional and can only occur where FIMBank has a
sound capital base. It will only be awarded once to the same single employee
and cannot be awarded again if the same employee receives a new contract
from the same Group entity or another entity with the scope of consolidation
of the Group.
The sign-on bonus may be awarded either in cash or in instruments.
N/A
FIMBank Group Annual Report & Financial Statements 2025
36
Variable remuneration (continued)
Element and purpose of
remuneration
Operation
Maximum opportunity
Performance measures
Buy-out compensation of
previous employment
contract
FIMBank may pay a buy-out compensation of a previous
employment contract in the first year of employment, if
applicable. Such buy-out compensation will require the
approval of the BNRC.
FIMBank may, in exceptional circumstances (where the deferred variable
remuneration of a new Executive was reduced or revoked by the previous
employer because of the termination of the contract), pay a buy-out
compensation to on-board a new Executive. Such bonus would require the
a priori approval of the BNRC and is disbursed on a one-time conditional
basis during the first year of employment.
The buy-out compensation is exceptional and can only occur where
FIMBank has a sound capital base.
N/A
BNRC decisions are determined by the guidelines set by the Board of Directors when reviewing the Group budget. In line with Article 135-139 of Banking Rule 21 (BR21/2022) issued by the Malta Financial
Services Authority, the Bank ensures that any variable remuneration awarded is not detrimental to its sound and strong capital base. In the unlikely event that the soundness of the capital base may be at risk,
this will be escalated and presented to the BNRC.
The variable remuneration awarded to Executives is also subject to the below provisions emanating from the Directors’ Remuneration Policy:
Clawback and malus
Any variable remuneration extended by FIMBank to any of its Executives is subject to clawback and malus. These are defined in Banking Rule 21 as follows:
• malus means an arrangement that permits the institution to reduce the value of all or part of deferred variable remuneration based on ex post risk adjustments
before it has vested; and
• clawback means an arrangement under which the staff member has to return ownership of an amount of variable remuneration paid in the past years or which has
already vested to the institution under certain conditions.
Malus will be capable of being applied in respect of deferred elements of variable remuneration at any time during the applicable deferral period. Clawback will apply
during the period of four years from the date of award or until the end of the applicable retention period, as applicable. FIMBank reserves the right to apply clawback
and malus on 100% of bonus paid and/or deferred, in the case of gross misconduct as defined in the Disciplinary Policy and in the event that conditions stipulated in the
performance targets in the subsequent two years are not met.
FIMBank Group Annual Report & Financial Statements 2025
37
Variable remuneration (continued)
Total maximum variable
remuneration
The total annual variable remuneration for Executives is capped at 100% of total fixed annual remuneration for each individual. This cap may be increased up to a
maximum of 200% to total fixed annual remuneration provided the following conditions are fulfilled:
• the shareholders shall approve a higher ratio based on a detailed recommendation giving reasons for and the scope of the approval sought, including the number of
staff affected, their functions and the expected impact of such variable remuneration on the requirement that the relevant FIMBank entities maintain a sound capital
base;
• the shareholders approve such variable remuneration award or awards by a majority of at least 66%, with at least 50% of the shares or equivalent ownership rights
being represented or, failing that, acting by a majority of 75% of the ownership rights represented;
• the relevant FIMBank entity shall notify all shareholders that the approval shall be sought and shall provide a reasonable notice period in advance;
• the FIMBank entity shall promptly inform its regulator of any recommendation to its shareholders to operate within the proposed 200% ratio and the reasons for
this, and shall in such submission demonstrate that the higher ratio of variable remuneration does not conflict with FIMBank’s obligations under the applicable
legislation, particularly in respect of own funds obligations;
• the FIMBank entity shall promptly inform its regulator of the decisions taken by the shareholders to approve the proposed higher maximum ratio; and
• staff members directly concerned with the proposed higher maximum ratio shall not be permitted to exercise, directly or indirectly, any voting rights they may have
in respect of the approval of any proposal relating to this ratio.
Payment of deferred bonus in case of
loss
In case FIMBank incurs a loss in a financial year, in the interest of strengthening the capital base and getting FIMBank back in good standing, payment or otherwise of any
deferred bonus will be decided by the BNRC. Such bonuses may be further deferred in the interest of sustainability.
Reassessment of performance
Every year, before paying out the deferred part of cash or the vesting of deferred instruments, a reassessment of the performance and, if necessary, an ex-post risk
adjustment shall be applied to align variable remuneration to additional risks that have been identified or materialised after the award. This also applies where multi-year
accrual periods are used.
Other requirements: Derogation
By virtue of Paragraph 20 of Banking Rule 21, given that a) the Bank does not meet the definition of a large institution as defined in Article 4(1) of the CRR; and b) the
value of the Bank’s assets over the four-year period immediately preceding the current financial year is less than €5 billion, the following requirements emanating from
Article 94 of CRD V are not deemed to be applicable to the Bank, namely:
a. the principle that a minimum of 50% of any variable remuneration shall consist of shares; and
b. the principle that at least 40% of variable remuneration is deferred over a period of not less than 4 to 5 years.
FIMBank Group Annual Report & Financial Statements 2025
38
Information on remuneration in terms of code provision 8.A.5 of the MFSA capital
markets rules
The Annual General Meeting of Shareholders approves the maximum annual aggregate remuneration which the Directors may receive for the
holding of their office. At the Annual General Meeting held on 13 May 2025, the Shareholders approved the maximum aggregate emoluments of
the Non-Executive Directors for the financial year ended 31 December 2025 amounting to USD450,000 (2024: USD450,000). Executive Directors are
only remunerated as employees and do not receive any Directors’ fees. Directors, in their capacity as Directors of the Bank, are not entitled to profit
sharing, share options or pension benefits. The total fees paid specifically for Board of Directors Meetings for the financial year ended 31 December
2025 amounted to USD, which is included as part of the total payments received by Non-Executive Directors disclosed below.
For 2025, the total remuneration awarded to Non-Executive Directors by the Bank was:
• fixed remuneration USD371,250
• variable remuneration Nil
• executive share options Nil
• fringe benefits USD400
The fixed annual remuneration is inclusive of remuneration with respect to Committee/s memberships. In this respect, the Directors’ emoluments
are within the limit approved by the Annual General Meeting of 13 May 2025.
For 2025, the total remuneration awarded to the GCEO, Deputy CEO and Executive Management by the Bank was:
• fixed remuneration USD2,125,880
• variable remuneration * USD531,940
• executive share options granted Nil
• fringe benefits USD435,007
' * ’ Variable remuneration represents the amounts attributable to the GCEO, Deputy CEO and Executive Management in respect of performance
year 2025.
Additional disclosures on the governance process related to the variable portion of remuneration have been made under the Directors’
Remuneration Report and under the Section discussing the Remuneration Policy of the 2025 Pillar 3 Disclosures Report published on the Bank’s
website.
None of the Directors received any fees for holding the office of Director by the Bank's parent entities or any other related undertakings in respect
of services rendered to the FIMBank Group. The Directors believe that the requirements emanating from paragraph (c) of Appendix 12.1 of the
Capital Markets Rules, which requires the disclosure of “any remuneration from any undertaking belonging to the same group where the term group
means parent undertaking and all its subsidiary undertakings” applies at the level of FIMBank p.l.c., the Bank's parent entity, and its subsidiary
undertakings respectively, taking cognisance of their role as Directors of the Bank. Accordingly, no disclosure in respect of their remuneration for
any services which they might be providing at parent entity level is being made within this report.
FIMBank Group Annual Report & Financial Statements 2025
39
Directors’ remuneration report (as per capital market rules 12.26K)
This Report is being included with the purpose of providing the level of transparency as required with effect from reporting year 2020, following the
enactment of Directive EU2017/828 (often referred to as “SRDII”) and the consequential changes to the Capital Markets Rules, more specifically
Chapter 12 which deals with shareholders’ rights. The amounts disclosed reflect the Directors’ Remuneration Policy (“Policy”) as approved by the
Annual General Meeting held on 12 June 2024 and published on the Bank’s website (refer to the policy in full on
https://www.fimbank.com/en/remuneration-policy). The said Policy and its implementation are reviewed annually by the BNRC. In terms of Capital
Markets Rule 12.26l, any material amendments to the Policy shall be submitted to a vote by the General Meeting before their adoption and in any
case at least every four years. During 2025, material changes to the Directors’ Remuneration Policy were proposed and shall be presented for
approval at the 2026 Annual General Meeting. The proposed changes comprise a streamlined re-write of the policy, clearly setting out the core
principles and governance framework underpinning the remuneration arrangements for the Directors, the Group Chief Executive Officer, and the
Deputy Group Chief Executive Officer, as applicable. While preserving all relevant and material content, the policy has been restructured to enhance
clarity and ensure full alignment with all applicable regulatory requirements.
In terms of the requirements within Appendix 12.1 of the Capital Markets Rules, the following sub-sections of the Directors’ Remuneration Report
present the total remuneration paid to each Director in respect of the financial year ended 31 December 2025 (analysed further between fixed and
variable remuneration), as well as the annual change of remuneration of the Executive Directors, of the Bank’s performance and of average
remuneration on a full-time equivalent basis of the Bank’s employees (other than Directors) over the four most recent financial years.
Non-executive directors
The Bank’s approach to remuneration is that of ensuring that the Bank is able to attract and retain talented and high performing Directors by
recognising, valuing and fairly rewarding their contributions while remaining aligned to the Bank’s long-term strategy, risk appetite, sustainable
performance and corporate values.
The total remuneration of each individual Director is detailed in the following tables. Non-Executive Directors only receive fixed fees for directorship
services. Consequently, the percentage split between fixed and variable should be taken as 100% vs 0%.
For information about the general performance and events of material importance of the Bank refer to the Statements of Profit or Loss and the
Statements of Other Comprehensive Income on pages 49 and 50 and in the Review of Performance section within the Director’s Report. These did
not impact the total remuneration of Non-Executive Directors.
The Non-Executive Directors did not receive any base salary, variable remuneration or compensation in respect of extraordinary items and pension
contributions during the financial year ended 31 December 2025. In addition, Non-Executive Directors are not entitled to profit-sharing
arrangements, share options, shares or pension benefits.
FIMBank Group Annual Report & Financial Statements 2025
40
Non-executive directors’ remuneration
Difference
Difference
Difference
Difference
Difference
Name of director
2025
2024
2023
2022
2021
2025 vs
2024
2024 vs
2023
2023 vs
2022
2022 vs
2021
2021 vs
2020
Notes
USD
USD
USD
USD
USD
%
%
%
%
%
John C. Grech
* 101,150
* 101,150
100,891
100,400
101,032
-
0.3
0.5
(0.6)
2.8
No change in fee structure in 2025.
Masaud M.J. Hayat
19,750
19,750
19,750
19,750
17,000
-
-
-
16.2
(17.1)
No change in fee structure in 2025.
Edmond Brincat
63,000
62,500
51,356
46,000
47,333
0.8
21.7
11.6
(2.8)
1.6
No change in fee structure in 2025. The marginal increase
is due to Mr. Brincat receiving the full annual fee at the
same fee structure in 2025, whereas in 2024, there was
a change in fee structure following the adjustment in
committees' composition. In July 2024 Mr. Brincat was
appointed as Member to the BCGC and the BRIC while
relinquishing his role as Member and Chairperson of the
BESG.
‘ * ’ The remuneration of Non-Executive Directors comprises fees only, except for the case of the Chairperson of the Board of Directors whose total emoluments for 2025 comprise USD100,750 in fees and USD400
in fringe benefits.
FIMBank Group Annual Report & Financial Statements 2025
41
Non-executive directors’ remuneration (continued)
Difference
Difference
Difference
Difference
Difference
Name of director
2025
2024
2023
2022
2021
2025 vs
2024
2024 vs
2023
2023 vs
2022
2022 vs
2021
2021 vs
2020
Notes
USD
USD
USD
USD
USD
%
%
%
%
%
Hussain Abdul Aziz Lalani
44,750
44,750
39,417
36,750
36,750
-
13.5
7.3
-
5.4
No change in fee structure in 2025.
Rabih Soukarieh
27,000
27,000
27,000
24,750
23,000
-
-
9.1
7.6
(11.9)
No change in fee structure in 2025.
Samer Abbouchi
35,000
15,083
NA
NA
NA
-
NA
NA
NA
NA
No change in fee structure in 2025. The increase is due
to Mr. Abbouchi receiving the full annual fee for the
reporting year, whereas in 2024, he received a partial
fee following his appointment as a Member to the BoD
and BRC in June 2024. He was also appointed to the
BCC in October 2024. The annualisation of fees paid to
Mr. Abbouchi in 2024 would result in fees which are in
line with those paid in respect of 2025.
Sunny Bhatia
27,000
27,000
11,250
NA
NA
-
-
NA
NA
NA
No change in fee structure in 2025.
Teuta Bakalli
54,000
30,834
NA
NA
NA
-
NA
NA
NA
NA
No change in fee structure in 2025. The increase is due
to Ms. Bakalli receiving the full annual fee for the
reporting year, whereas in 2024, she received a partial
fee following her appointment as a Member to the BoD,
BRC, BAC and BCGC in May 2024. In July 2024, Ms.
Bakalli was also appointed as a Member and
Chairperson of the BESG, while relinquishing her role as
Member of the BCGC. The annualisation of fee paid to
Ms. Bakalli in 2024 would result in fees which are in line
with those paid in respect of 2025.
In addition to the presented fees, Directors Dr. John C. Grech, Mr. Hussain Abdul Aziz Lalani, Mr. Samer Abbouchi and Ms. Teuta Bakalli were also awarded remuneration for their services as Directors on the LFC
Board of Directors. The fees awarded are: Dr. John C. Grech (Chairperson) USD15,000, Mr. Hussain Abdul Aziz Lalani USD10,000, Mr. Samer Abbouchi USD10,000 and Ms. Teuta Bakalli USD10,000.
FIMBank Group Annual Report & Financial Statements 2025
42
Non-executive directors’ remuneration (continued)
The positions held by the Bank’s Non-Executive Directors during the financial year ended 31 December 2025 are presented hereunder:
Name of director
Position
John C. Grech
Non-Executive Director, Chairperson FIMBank BoD, Chairperson LFC BoD, Chairperson BRIC, Chairperson BCC, Chairperson BCGC, Permanent Invitee BNRC
Masaud M.J. Hayat
Non-Executive Director, Vice Chairperson FIMBank BoD, Chairperson BNRC
Edmond Brincat
Independent Non-Executive Director, Member FIMBank BoD, Chairperson BAC, Vice Chairperson BNRC, Member BCGC, Member BRIC
Hussain Abdul Aziz Lalani
Non-Executive Director, Member FIMBank BoD, Vice Chairperson LFC BoD, Chairperson BRC, Vice Chairperson BAC, Vice Chairperson BRIC, Vice Chairperson BESGC
Rabih Soukarieh
Non-Executive Director, Member FIMBank BoD, Vice Chairperson BCC
Samer Abbouchi
Non-Executive Director, Member FIMBank BoD, Member LFC BoD, Vice Chairperson BRC, Member BCC
Sunny Bhatia
Non-Executive Director, Member FIMBank BoD, Vice Chairperson BCGC, Member BNRC
Teuta Bakalli
Independent Non-Executive Director, Member FIMBank BoD, Member LFC BoD, Chairperson BESGC, Member BAC, Member BRC
FIMBank Group Annual Report & Financial Statements 2025
43
Executive directors
In accordance with Capital Markets Rules 12.2A, the disclosure of information in terms of Capital Markets Rules 12.26K and Appendix 12.1 to Chapter 12 of the Capital Markets Rules is applicable in respect of
remuneration payable to the GCEO and the Deputy CEO.
Effective 1 August 2024, Mr. Simon Jethro Lay, who served as Deputy CEO until 31 July 2024, was appointed GCEO and Executive Director (as per company announcement dated 2 August 2024 and subsequent
regulatory approval announcement dated 12 March 2025). In addition, Mr. Lay also held the position of CEP of London Forfaiting Company (“LFC”) throughout the financial year ended 31 December 2024.
The following tables present information in respect of remuneration received by the GCEO and Executive Director, Mr. Simon Jethro Lay. Mr. Simon Jethro Lay received remuneration from LFC, where he holds
the position of CEO of this subsidiary of the Bank.
Fixed remuneration
Variable remuneration
Name of executive
Base salary
Fees
* Fringe benefits
One-year variable
Multi-year variable
Total remuneration
Proportion of fixed and variable
remuneration
relative to total remuneration
USD
USD
USD
USD
USD
USD
USD
Simon Jethro Lay
818,472
-
153,195
349,830
-
1,321,497
73.5%: 26.5%
‘ * ‘ The amount in respect of Mr. Simon Jethro Lay includes: pension plan allowance and health and life insurance cover.
The variable remuneration awarded to Mr. Simon Jethro Lay in respect of performance year 2025 reflects his overall performance as CEO of LFC, and GCEO and Executive Director of FIMBank. In determining the
variable remuneration, his performance was assessed by the BNRC against specific goals related to financials as well as other criteria, namely service/client delivery; risk and control; leadership and people
management; market position; and project and initiatives. On the basis of this assessment, the BNRC approved the aforementioned performance bonus awarded to Mr. Simon Jethro Lay. This is in view of Mr.
Lay’s material contribution in ensuring that LFC continues to be a profit-making entity for the FIMBank Group in 2025 and for his continued leadership in the strategic transformation of the Bank.
In accordance with the Group’s Remuneration Policy, no deferral requirements are applicable to the variable remuneration awarded for the financial year ended 31 December 2025. In addition, the variable
remuneration is payable in cash and, accordingly, no share-based remuneration was awarded to Mr. Simon Jethro Lay. There were no circumstances warranting severance payments during the reporting year.
Finally, none of the variable remuneration awarded in respect of the financial year ended 31 December 2025 or the preceding financial years were reclaimed or adjusted, neither in the form of malus nor in the
form of clawback.
FIMBank Group Annual Report & Financial Statements 2025
44
Executive directors (continued)
An analysis of the annual change of remuneration paid to Executive Director over the last four financial years is presented hereunder:
* Difference
* Difference
* Difference
* Difference
* Difference
Name of executive
2025
2024
2023
2022
2021
2025 vs
2024
2024 vs
2023
2023 vs
2022
2022 vs
2021
2021 vs
2020
Notes
USD
USD
USD
USD
USD
%
%
%
%
%
Simon Jethro Lay
1,321,497
1,048,723
906,433
713,281
873,468
26.0
15.7
27.1
(18.3)
20.1
The increase in the remuneration of Mr.
Simon Jethro Lay of USD272,774 is
attributable to remuneration received for
his duties as GCEO and Executive Director
for the full year, whereas the prior year
reflected only the period from his
appointment on 1 August 2024. The
increase also reflects the impact of
fluctuations in the GBP and EUR to USD
exchange rates.
‘ * ‘ Differences also include fluctuation in rate of exchange from GBP and EUR to USD.
FIMBank Group Annual Report & Financial Statements 2025
45
Executive directors (continued)
The positions held by the Bank’s Executive Director during the financial year ended 31 December 2025 are presented hereunder:
Name of executive
Position
Simon Jethro Lay
GCEO and Executive Director, Member of the FIMBank BoD, Member LFC BoD, Member BESGC, Non-Voting Member BRIC, Permanent Invitee BCC, Chairperson ALCO, Chairperson
NCIC, Chairperson MCC, Member ITSC, Member ORMC, Member ERPC.
During 2025 he continued to serve as LFC CEO
Company performance and average remuneration of the bank’s employees
In terms of the requirements within Appendix 12.1 of the Capital Markets Rules, the following tables present the annual change of the Bank’s performance and of average remuneration on a full-time equivalent
basis of the Bank’s employees (other than directors) over the four most recent financial years.
Performance indicators
2025
2024
2023
2022
2021
Difference
2025 vs
2024
Difference
2024 vs
2023
Difference
2023 vs
2022
Difference
2022 vs
2021
Difference
2021 vs
2020
USD
USD
USD
USD
USD
%
%
%
%
%
Profit before net impairment and tax
(2.741,128)
2,391,977
6,290,495
4,206,308
3,237,112
(214.6)
(62.0)
49.5
29.9
155.6
Net (loss)/profit for the period
(4,334,449)
(3,203,686)
2,490,148
(22,010,084)
(663,219)
35.3
(228.7)
(111.3)
(3,218.7)
98.8
Gross non-performing assets
9,586,970
12,886,098
20,605,923
93,835,376
119,068,469
(25.6)
* 37.5
* 78.0
* 21.2
* 31.7
‘ * ‘ Percentages in respect of FIMBank’s performance are being shown as positive given that the figures denote improvements in these metrics.
Average remuneration on full-time equivalent basis of
employee
2025
2024
2023
2022
2021
Difference
2025 vs
2024
Difference
2024 vs
2023
Difference
2023 vs
2022
Difference
2022 vs
2021
Difference
2021 vs
2020
USD
USD
USD
USD
USD
%
%
%
%
%
Employees of the Bank
86,732
78,876
74,684
77,158
79,792
10
5.6
(3.2)
(3.3)
5.2
FIMBank Group Annual Report & Financial Statements 2025
46
Denotes membership of:
• FIMBank Board of Directors (“BoD”)
• Board Audit Committee (“BAC”)
• Board Corporate Governance Committee (“BCGC”)
• Board Credit Committee (“BCC”)
• Board Environment, Social and Governance Committee (“BESGC”)
• Board Nomination and Remuneration Committee (“BNRC”)
• Board Review and Implementation Committee (“BRIC”)
• Board Risk Committee (“BRC”)
• Asset Liabilities Committee (“ALCO”)
• Management Credit Committee (“MCC”)
• Management Environmental, Social and Governance Committee (“MESGC”)
• Management Governance Committee (“MGC”)
• Management Product Committee ("MPC”)
• Emerging Risk and Provisioning Committee (“ERPC”)
• IT Steering Committee (“ITSC”)
• Non-Credit Insurance Committee (“NCIC”)
• Operational Risk Management Committee (“ORMC”)
The Directors’ Remuneration Report for 2024 was approved at the Annual General Meeting held on 13 May 2025 with the Resolution being passed
by 427,809,225 votes in favour, 52,719,431 “as he prefers” votes, 611 votes against and 5,066,372 abstentions. There were no issues raised on the
Report during the said Annual General Meeting.
This Directors’ Remuneration Report in terms of Chapter 12 of the Capital Markets Rules is being put forward to an advisory vote of the 2026 Annual
General Meeting in accordance with the requirements of the Capital Markets Rule 12.26 L.
In accordance with Capital Markets Rule 12.26N, the contents of the Directors’ Remuneration Report within this Remuneration Report have been
reviewed by the external auditor to ensure compliance with the requirements emanating from Appendix 12.1 of the Capital Markets Rules.
FIMBank Group Annual Report & Financial Statements 2025
47
Statements of financial position
For the year ended 31 December
Group | Bank | ||||
2025 | 2024 | 2025 | 2024 | ||
Note | USD | USD | USD | USD | |
Assets | |||||
Balances with the Central Bank of Malta, treasury bills and cash | 19 | 84,470,832 | 134,179,290 | ||
Derivative assets held for risk management | 20 | 4,163,342 | 1,464,641 | ||
Trading assets | 21 | - | - | ||
Loans and advances to banks | 22 | 81,847,983 | 90,098,124 | ||
Loans and advances to customers | 23 | 638,590,462 | 517,783,911 | ||
Financial investments at fair value through profit or loss | 24 | 9,882,219 | 13,958,450 | ||
Financial investments at fair value through other comprehensive income | 25 | 105,254,684 | 120,265,095 | ||
Financial investments at amortised cost | 26 | 137,467,852 | 2,073,906 | ||
Investments in subsidiaries | 27 | 114,200,942 | 116,182,573 | ||
Assets classified as held for sale | 17 | 8,523,449 | - | ||
Property and equipment | 28 | 10,006,880 | 1,916,689 | ||
Investment property | 29 | - | - | ||
Intangible assets | 31 | 3,026,193 | 2,906,773 | ||
Current tax assets | - | - | |||
Deferred tax assets | 32 | 15,004,834 | 15,004,834 | ||
Other assets | 33 | 7,857,797 | 9,312,395 | ||
Total assets | 1,220,297,469 | 1,025,146,681 | |||
Liabilities and equity | |||||
Liabilities | |||||
Derivative liabilities held for risk management | 20 | 2,844,896 | 1,165,387 | ||
Amounts owed to institutions and banks | 34 | 160,871,504 | 168,729,126 | ||
Amounts owed to customers | 35 | 852,545,809 | 679,691,057 | ||
Debt securities in issue | 36 | - | - | ||
Liabilities directly associated with the assets held for sale | 17 | - | - | ||
Current tax liabilities | - | - | |||
Deferred tax liabilities | 32 | - | - | ||
Provision for liabilities and charges | 37 | 835,553 | 211,125 | ||
Other liabilities | 38 | 18,912,678 | 8,584,443 | ||
Subordinated liabilities | 39 | 20,281,111 | - | ||
Total liabilities | 1,056,291,551 | 858,381,138 | |||
Equity | |||||
Called-up share capital | 40 | 261,221,882 | 261,221,882 | ||
Share premium | 40 | 858,885 | 858,885 | ||
Currency translation reserve | 40 | ( | ( | - | - |
Fair value reserve | 40 | (10,620,330) | (12,195,204) | ||
Other reserve | 40 | 2,681,041 | 2,681,041 | ||
Accumulated losses | 40 | ( | ( | (90,135,560) | (85,801,061) |
Total equity attributable to equity holders of the Group | 164,005,918 | 166,765,543 | |||
Non-controlling interests | 41 | - | - | ||
Total equity | 164,005,918 | 166,765,543 | |||
Total liabilities and equity | 1,220,297,469 | 1,025,146,681 |
FIMBank Group Annual Report & Financial Statements 2025
48
Statements of financial position
For the year ended 31 December
Group | Bank | ||||
2025 | 2024 | 2025 | 2024 | ||
Note | USD | USD | USD | USD | |
Memorandum items | |||||
Contingent liabilities | 42 | 29,662,129 | 30,960,840 | ||
Commitments | 43 | 167,291,184 | 111,629,563 |
The official middle rate of exchange issued by the European Central Bank between US Dollar and Euro as at 31 December 2025 was 1.1750 (2024:
1.0389).
The Notes on pages 57 to 197 are an integral part of these Financial Statements.
The Financial Statements on pages 47 to 197 were approved and authorised for issue by the Board of Directors on 26 March 2026.
Approved by the Board of Directors and signed on its behalf by Dr. John C. Grech (Chairman) and Mr. Masaud M.J. Hayat (Vice Chairman) on 26
March 2026 as per Director’s Declaration on ESEF Annual Financial Report submitted in conjunction with the Annual Report and Financial
Statements 2025.
FIMBank Group Annual Report & Financial Statements 2025
49
Statements of profit or loss
For the year ended 31 December
Group | Bank | ||||
2025 | 2024 | 2025 | 2024 | ||
Note | USD | USD | USD | USD | |
Interest income | 8 | 44,371,362 | 54,480,196 | ||
Interest expense | 8 | ( | ( | (21,751,623) | (35,797,670) |
Net interest income | 8 | 22,619,739 | 18,682,526 | ||
Fee and commission income | 9 | 4,277,272 | 3,785,269 | ||
Fee and commission expense | 9 | ( | ( | (929,489) | (1,163,931) |
Net fee and commission income | 9 | 3,347,783 | 2,621,338 | ||
Net trading results | 10 | ( | 422,760 | (534,483) | |
Net loss from equity investments measured at fair value through profit or loss | 11 | ( | ( | (5,797,998) | (718,609) |
Dividend income | 12 | 840,796 | 6,000,000 | ||
Impairment charge in respect of investments in subsidiaries | 27 | - | (1,500,000) | ||
Other operating income | 13 | 1,217,397 | 194,273 | ||
Other operating expenses | 14 | ( | ( | (214,841) | - |
Operating income before credit losses | 22,435,636 | 24,745,045 | |||
Net movement in expected credit losses and other credit impairment charges | 4 | ( | ( | (743,146) | (3,180,417) |
Operating income | 21,692,490 | 21,564,628 | |||
Administrative expenses | 15 | ( | ( | (22,059,995) | (21,010,359) |
Depreciation and amortisation | 28/31 | ( | ( | (3,116,769) | (2,842,709) |
Total operating expenses | ( | ( | (25,176,764) | (23,853,068) | |
Profit/(Loss) before tax | (3,484,274) | (2,288,440) | |||
Taxation | 16 | ( | ( | (850,225) | (915,246) |
Loss for the year from continuing operations | ( | ( | (4,334,499) | (3,203,686) | |
Profit from discontinued operations | 17 | - | - | ||
Profit/(Loss) for the year | (4,334,499) | (3,203,686) | |||
Profit/(Loss) for the year attributable to: | |||||
Equity holders of the Group | (4,334,499) | (3,203,686) | |||
Non-controlling interests | 41 | - | - | ||
(4,334,499) | (3,203,686) | ||||
Profit/(Loss) for the year attributable to the equity holders of the Group: | |||||
Continuing operations | ( | ( | (4,334,499) | (3,203,686) | |
Discontinued operations | 17 | - | - | ||
(4,334,499) | (3,203,686) | ||||
Earnings per share | |||||
Basic earnings per share (US cents) | 18 | ||||
Basic earnings per share on continuing operations (US cents) | 18 | ( | ( |
The Notes on pages 57 to 197 are an integral part of these Financial Statements.
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Statements of other comprehensive income
For the year ended 31 December
Group | Bank | |||
2025 | 2024 | 2025 | 2024 | |
USD | USD | USD | USD | |
Profit/(Loss) for the year | (4,334,499) | (3,203,686) | ||
Other comprehensive income: | ||||
Items that are or may be reclassified subsequently to profit or loss: | ||||
Foreign operations - foreign currency translation differences | ( | ( | - | - |
Debt instruments at fair value through other comprehensive income: | ||||
- Fair value gains | 1,574,874 | 5,187,246 | ||
1,574,874 | 5,187,246 | |||
Other comprehensive income, net of tax | 1,574,874 | 5,187,246 | ||
Total comprehensive income | (2,759,625) | 1,983,560 | ||
Total comprehensive income attributable to: | ||||
Equity holders of the Group | (2,759,625) | 1,983,560 | ||
Non-controlling interests | - | - | ||
(2,759,625) | 1,983,560 | |||
Total comprehensive income attributable to the equity holders of the Group: | ||||
Continuing operations | ( | (2,759,625) | 1,983,560 | |
Discontinued operation | - | - | ||
(2,759,625) | 1,983,560 |
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Statements of changes in equity
For the year ended 31 December 2025
Group
Attributable to equity holders of the Group
Called-up | Currency | Non- | |||||||
share | Share | translation | Fair value | Other | Accumulated | controlling | Total | ||
capital | premium | reserve | reserve | reserve | losses | Total | interests | equity | |
USD | USD | USD | USD | USD | USD | USD | USD | USD | |
Balance at 1 January 2025 | ( | ( | |||||||
Total comprehensive income | |||||||||
Profit for the year | |||||||||
Other comprehensive income: | |||||||||
- Debt instruments at fair value through other comprehensive income – fair value gains, net of tax | |||||||||
- Foreign operations – foreign currency translation differences | ( | ( | ( | ||||||
Total other comprehensive income | ( | ||||||||
Total comprehensive income | ( | ||||||||
Transactions with owners: | |||||||||
Changes in ownership in subsidiary that do not result in loss of control: | |||||||||
- Impact of change in non-controlling interest in subsidiary | ( | ( | |||||||
- Consideration paid to non-controlling interest | ( | ( | ( | ||||||
Total transaction with owners | ( | ( | ( | ( | ( | ||||
Balance at 31 December 2025 | ( | ( |
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Statements of changes in equity
For the year ended 31 December 2024
Group
Called-up | Currency | Attributable to equity holders of the Group | Non- | ||||||
share | Share | translation | Fair value | Other | Accumulated | controlling | Total | ||
capital | premium | reserve | reserve | reserve | losses | Total | interests | equity | |
USD | USD | USD | USD | USD | USD | USD | USD | USD | |
Balance at 1 January 2024 | ( | ( | ( | ||||||
Total comprehensive income | |||||||||
Profit for the year | |||||||||
Other comprehensive income: | |||||||||
- Debt instruments at fair value through other comprehensive income – fair value gains, net of tax | |||||||||
- Foreign operations – foreign currency translation differences | ( | ( | ( | ( | |||||
Total other comprehensive income | ( | ( | |||||||
Total comprehensive income | ( | ||||||||
Balance at 31 December 2024 | ( | ( |
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Statements of changes in equity
For the year ended 31 December 2025
Bank
Called-up
share capital
Share
premium
Fair value
reserve
Other
reserve
Accumulated
losses
Total
equity
USD
USD
USD
USD
USD
USD
Balance at 1 January 2025
261,221,882
858,885
(12,195,204)
2,681,041
(85,801,061)
166,765,543
Total comprehensive income
Loss for the year
-
-
-
-
(4,334,499)
(4,334,499)
Other comprehensive income:
- Debt investments at fair value through other comprehensive income – fair value gains, net of tax
-
-
1,574,874
-
-
1,574,874
Total other comprehensive income
-
-
1,574,874
-
-
1,574,874
Total comprehensive income
-
-
1,574,874
-
(4,334,499)
(2,759,625)
Balance at 31 December 2025
261,221,882
858,885
(10,620,330)
2,681,041
(90,135,560)
164,005,918
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Statements of changes in equity
For the year ended 31 December 2024
Bank
Called-up
share capital
Share
premium
Fair value
reserve
Other
reserve
Accumulated
losses
Total
equity
USD
USD
USD
USD
USD
USD
Balance at 1 January 2024
261,221,882
858,885
(17,382,450)
2,681,041
(82,597,375)
164,781,983
Total comprehensive income
Loss for the year
-
-
-
-
(3,203,686)
(3,203,686)
Other comprehensive income:
- Debt investments at fair value through other comprehensive income – fair value gains, net of tax
-
-
5,187,246
-
-
5,187,246
Total other comprehensive income
-
-
5,187,246
-
-
5,187,246
Total comprehensive income
-
-
5,187,246
-
(3,203,686)
1,983,560
Balance at 31 December 2024
261,221,882
858,885
(12,195,204)
2,681,041
(85,801,061)
166,765,543
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Statements of cash flows
For the year ended 31 December
Group | Bank | |||
2025 | 2024 | 2025 | 2024 | |
USD | USD | USD | USD | |
Cash flows from operating activities | ||||
Interest and commission receipts | 48,632,464 | 57,122,686 | ||
Interest and commission payments | ( | ( | (26,332,210) | (38,459,787) |
Payments to employees and suppliers | ( | ( | (21,863,304) | (21,709,008) |
Operating profit/(loss) before changes in operating | ||||
assets/liabilities | 436,950 | (3,046,109) | ||
(Increase)/Decrease in operating assets: | ||||
- Loans and advances to banks and customers | ( | (95,822,492) | 110,243,934 | |
- Other assets | ( | 2,327,985 | (2,063,793) | |
Increase/(Decrease) in operating liabilities: | ||||
- Amounts owed to institutions, banks and customers | ( | 206,249,454 | (426,610,162) | |
- Other liabilities | ( | 1,522,105 | 517,580 | |
- Net inflows from balances with subsidiary companies | - | - | (68,637,490) | 36,012,891 |
Cash flows (used in)/from trading assets: | ||||
- Payments to acquire trading assets | ( | ( | - | (9,900,000) |
- Proceeds on settlement of trading assets | - | 10,046,076 | ||
Net cash (used in)/from operating activities | ||||
before income tax | ( | ( | 46,076,512 | (284,799,583) |
Income tax paid | ( | ( | (850,225) | (915,246) |
Net cash flows (used in)/from operating activities | ( | ( | 45,226,287 | (285,714,829) |
Cash flows (used in)/from investing activities | ||||
Payments to acquire financial investments at amortised cost | ( | (135,065,404) | - | |
Payments to acquire treasury bills at amortised cost | ( | - | (31,587,228) | |
Payments to acquire shares and additional contributions in subsidiary companies | - | - | (6,360,800) | - |
Payments to acquire property and equipment | ( | ( | (832,719) | (284,181) |
Payments to acquire intangible assets | ( | ( | (1,010,484) | (1,149,354) |
Proceeds on redemption of financial investments at fair value through profit or loss | - | 3,607,970 | ||
Proceeds on maturity of financial investments at fair value through other comprehensive income | 29,755,930 | 17,882,889 | ||
Proceeds on maturity of financial investments at amortised cost | 2,000,000 | 26,429,022 | ||
Proceeds on maturity and disposals of treasury bills | ||||
at amortised cost | 5,174,912 | 156,492,976 | ||
Proceeds on cancellation of shares of a subsidiary company | - | - | - | 40,000,000 |
Proceeds on merger by acquisition of a subsidiary company | - | - | - | 3,487 |
Proceeds on disposal of property and equipment | - | - | ||
Receipt of dividends | 840,796 | 6,000,000 | ||
Net cash flows (used in)/from investing activities | ( | (105,497,769) | 217,395,581 | |
Decrease in cash and cash equivalents c/f | ( | ( | (60,271,482) | (68,319,248) |
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Statements of cash flows
For the year ended 31 December
Group | Bank | |||
2025 | 2024 | 2025 | 2024 | |
USD | USD | USD | USD | |
Decrease in cash and cash equivalents b/f | ( | ( | (60,271,482) | (68,319,248) |
Cash flows from/(used in) financing activities | ||||
Proceeds on issue of debt securities | - | - | ||
Payments to settle debt securities | ( | ( | - | - |
Acquisition of non-controlling interest | ( | - | - | |
Payments of lease liabilities | ( | ( | (1,785,516) | (1,732,785) |
Proceeds on issue of subordinated loans | 20,000,000 | - | ||
Net cash flows from/(used in) financing activities | ( | 18,214,484 | (1,732,785) | |
Effect of net exchange (losses)/gains attributable to assets and liabilities | ( | (16,117,357) | 9,801,806 | |
Decrease in cash and cash equivalents | ( | ( | (58,174,355) | (60,250,227) |
Analysed as follows: | ||||
- Effect of exchange rate changes on cash and cash equivalents | ( | 16,973,192 | (11,971,656) | |
- Net decrease in cash and cash equivalents | ( | ( | (75,147,547) | (48,278,571) |
Decrease in cash and cash equivalents | ( | ( | (58,174,355) | (60,250,227) |
Cash and cash equivalents at beginning of year | 67,479,505 | 127,729,732 | ||
Cash and cash equivalents at end of year | ( | 9,305,150 | 67,479,505 |
The Group’s statement of cash flows includes the cash flows relating to the discontinued operations. Further details on the cash flows attributable
to discontinued operations are provided in Note 17.
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Notes to the financial statements
For the year ended 31 December 2025
1
Reporting entity
25
Financial investments at fair value through other
2
Basis of preparation
comprehensive income
3
Material accounting policies
26
Financial investments at amortised cost
4
Financial risk review
27
Investments in subsidiaries
5
Fair values of financial instruments
28
Property and equipment
6
Classification of financial assets and liabilities
29
Investment property
7
Operating segments
30
Leases
8
Net interest income
31
Intangible assets
9
Net fee and commission income
32
Deferred taxation
10
Net trading results
33
Other assets
11
Net loss from equity investments measured
34
Amounts owed to institutions and banks
at fair value through profit or loss
35
Amounts owed to customers
12
Dividend income
36
Debt securities in issue
13
Other operating income
37
Provision for liabilities and charges
14
Other operating expenses
38
Other liabilities
15
Administrative expenses
39
Subordinated liabilities
16
Taxation
40
Equity
17
Discontinued operations and disposal group
41
Non-controlling interests
classified as held for sale
42
Contingent liabilities
18
Earnings per share
43
Commitments
19
Balances with the Central Bank of Malta, treasury bills and cash
44
Cash and cash equivalents
20
Derivatives held for risk management
45
Related parties
21
Trading assets
46
Capital commitments
22
Loans and advances to banks
47
Other commitments
23
Loans and advances to customers
48
Subsequent events
24
Financial investments at fair value through profit or loss
49
Ultimate parent company
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Notes to the financial statements
For the year ended 31 December 2025
2.1 Statement of compliance
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2.2 Basis of measurement
The Financial Statements have been prepared on the historical cost basis except for the following which are measured at fair value:
• ‘Derivatives held for risk management’;
• ‘Trading assets’;
• ‘Financial investments measured at fair value through profit or loss’;
• ‘Financial investments measured at fair value through other comprehensive income’;
• Freehold land and Improvement to premises within ‘Property and equipment’ at Group level; and
• ‘Investment property’ at Group level.
2.3 Presentation of information attributable to discontinued operations
In view of the Group’s decision to dispose of Egypt Factors (refer to Note 17), income and expenses recognised in the
Statement of profit or loss during the current and preceding financial years attributable to this subsidiary have been
presented within ‘Profit from discontinued operations’ in these financial statements.
2.4 Standards, interpretations and amendments to published standards
2.5 Standards, interpretations and amendments to published standards issued but
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2.6 Functional and presentation currency
2.7 Use of judgements and estimates
2.7.1 Judgements
2.7.2 Assumptions and estimation uncertainties
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3.1 Basis of consolidation
3.1.1 Business combinations
3.1.2 Subsidiaries
3.1.3 Interests in equity-accounted investees
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3.1.4 Non-controlling interests
3.1.5 Non-current assets (or disposal groups) held for sale and discontinued operations
3.1.6 Transactions eliminated on consolidation
3.1.7 Loss of control
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3.2 Foreign currency
3.2.1 Foreign currency transactions
3.2.2 Foreign operations
3.3 Interest income and expense
3.3.1 Effective interest rate
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3.3.2 Calculation of interest income and expense
3.3.3 Presentation
3.4 Fee and commission income and expense
3.5 Net trading results
3.6 Net gain or loss from other financial instruments at fair value through profit or loss
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3.7 Dividends
3.8 Income tax
3.8.1 Current tax
3.8.2 Deferred tax
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3.9 Financial assets and liabilities
3.9.1 Recognition and initial measurement
3.9.2 Classification
3.9.2.1 Financial assets
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3.9.2.2 Financial liabilities
3.9.3 Derecognition
3.9.3.1 Financial assets
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3.9.3.2 Financial liabilities
3.9.4 Modifications of financial assets and financial liabilities
3.9.4.1 Financial assets
3.9.4.2 Financial liabilities
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3.9.5 Identification and measurement of impairment
3.9.5.1 Measurement of ECL
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3.9.5.2 Purchased or originated credit-impaired financial assets
3.9.5.3 Restructured financial assets
3.9.5.4 Credit-impaired financial assets
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3.9.5.5 Financial guarantee contracts held
3.9.5.6 Presentation of allowance for ECL in the statement of financial position
3.9.5.7 Write-off
3.9.6 Offsetting
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3.9.7 Fair value measurement
3.10 Cash and cash equivalents
3.11 Investments in subsidiaries, associates and jointly controlled entities
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3.12 Property and equipment
3.12.1 Recognition and measurement
3.12.2 Subsequent costs
3.12.3 Depreciation
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3.12.4 Reclassification to investment property
3.12.5 Derecognition
3.13 Leases
3.13.1 Group acting as a lessee
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3.13.1.1 Short-term leases and leases of low-value assets
3.13.2 Group acting as a lessor
3.14 Investment property
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3.15 Intangible assets and goodwill
3.15.1 Recognition and measurement
3.15.1.1 Goodwill
3.15.1.2 Software
3.15.1.3 Other intangible assets
3.15.2 Subsequent expenditure
3.15.3 Amortisation
3.16 Impairment of non-financial assets
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3.17 Provisions
3.18 Financial guarantees and loan commitments
3.19 Employee benefits
3.19.1 Defined contribution plans
3.19.2 Share-based payment transactions
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3.20 Share capital
3.20.1 Ordinary shares
3.20.2 Repurchase of share capital
3.21 Earnings per share
3.22 Segment reporting
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4.1 Introduction and overview
4.1.1 Risk management framework
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4.2 Credit risk
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4.2.1 Default risk
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4.2.1.1 Maximum exposure to credit risk
Group | Bank | |||
2025 | 2024 | 2025 | 2024 | |
USD | USD | USD | USD | |
Balances with the Central Bank of Malta, treasury bills and cash | 84,495,977 | 134,192,217 | 84,470,832 | 134,179,290 |
Loans and advances to banks | 88,016,744 | 96,457,392 | 81,847,983 | 90,098,124 |
Loans and advances to customers | 438,403,451 | 427,976,723 | 638,590,462 | 517,783,911 |
Financial investments at fair value through other comprehensive income | 105,254,684 | 120,265,095 | 105,254,684 | 120,265,095 |
Financial investments at amortised cost | 41,294,459 | 2,073,906 | 137,467,852 | 2,073,906 |
Assets classified as held for sale: | ||||
- Loans and advances to banks | 3,985,393 | - | - | - |
- Loans and advances to customers | 63,470,336 | - | - | - |
Other assets | 4,766,698 | 6,804,541 | 5,310,343 | 6,603,179 |
Off-balance sheet: | ||||
- Guarantees | 26,676,661 | 27,628,498 | 26,676,661 | 27,632,552 |
- Commitments | 171,243,716 | 132,205,442 | 167,291,184 | 111,629,563 |
1,027,608,119 | 947,603,814 | 1,246,910,001 | 1,010,265,620 |
Group | Bank | |||
2025 | 2024 | 2025 | 2024 | |
USD | USD | USD | USD | |
Derivative assets held for risk management | 4,162,262 | 1,464,641 | 4,163,342 | 1,464,641 |
Trading assets | 444,796,402 | 274,733,298 | - | - |
Financial investments at fair value through profit or loss | 9,882,219 | 13,958,450 | 9,882,219 | 13,958,450 |
458,840,883 | 290,156,389 | 14,045,561 | 15,423,091 |
4.2.1.2 Credit risk measurement
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Grading | 12-month weighted-average PD | External rating |
Grades 1 to 4- low risk | 0.16% | Aaa-Baa3 |
Grades 5+ to 5- fair risk | 1.68% | Ba1-Ba3 |
Grades 6+ to 7 high risk | 4.23% | B1-Caa2 |
Grades 7- to 8- substandard | 29.16% | Caa3-Ca |
Grades 9 to 10 doubtful/loss | 100% | C |
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4.2.1.3 Measurement of expected credit losses
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4.2.1.4 Credit quality analysis
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2025 | |||||
12-month PD | Stage 1 | Stage 2 | Stage 3 | Total | |
ranges | USD | USD | USD | USD | |
Balances with the Central Bank of Malta, treasury bills and cash | |||||
Grades 1 to 4- low risk | 0.1% | 84,522,623 | - | - | 84,522,623 |
84,522,623 | - | - | 84,522,623 | ||
Loss allowance | (26,646) | - | - | (26,646) | |
Carrying amount | 84,495,977 | - | - | 84,495,977 | |
Loans and advances to banks | |||||
Grades 1 to 4- low risk | 0.13% - 0.59% | 30,967,705 | 371,261 | - | 31,338,966 |
Grades 5+ to 5- fair risk | 0.77% - 1.04% | 12,385,026 | - | - | 12,385,026 |
Grades 6+ to 7 high risk | 0.98% - 5.81% | 33,469,357 | 11,118,109 | - | 44,587,466 |
76,822,088 | 11,489,370 | - | 88,311,458 | ||
Loss allowance | (271,369) | (23,345) | - | (294,714) | |
Carrying amount | 76,550,719 | 11,466,025 | - | 88,016,744 | |
Loans and advances to customers | |||||
Grades 1 to 4- low risk | 0.04% - 0.82% | 30,419,469 | 47,359 | - | 30,466,828 |
Grades 5+ to 5- fair risk | 0.48% - 3.04% | 150,288,068 | 2,255,235 | - | 152,543,303 |
Grades 6+ to 7 high risk | 1.43% - 22.2% | 237,744,994 | 15,513,215 | - | 253,258,209 |
Grade 7- to 8- substandard | 29.16% | - | 7,009,447 | - | 7,009,447 |
Grade 9 to 10 doubtful/loss | 100% | - | - | 9,962,729 | 9,962,729 |
418,452,531 | 24,825,256 | 9,962,729 | 453,240,516 | ||
Loss allowance | (2,331,025) | (4,354,498) | (8,151,542) | (14,837,065) | |
Carrying amount | 416,121,506 | 20,470,758 | 1,811,187 | 438,403,451 | |
Financial investments at fair value through other comprehensive income | |||||
Grades 1 to 4- low risk | 0.06% - 0.27% | 105,254,684 | - | - | 105,254,684 |
Carrying amount at fair value | 105,254,684 | - | - | 105,254,684 | |
Loss allowance | (59,407) | - | - | (59,407) | |
Financial investments at amortised cost | |||||
Grades 1 to 4- low risk | 0.02% - 0.46% | 41,300,504 | - | - | 41,300,504 |
41,300,504 | - | - | 41,300,504 | ||
Loss allowance | (6,045) | - | - | (6,045) | |
Carrying amount | 41,294,459 | - | - | 41,294,459 | |
Guarantees | |||||
Grades 1 to 4- low risk | 0.18% - 0.46% | 722,551 | - | - | 722,551 |
Grades 5+ to 5- fair risk | 0.74% - 2.98% | 13,322,440 | 16,254 | - | 13,338,694 |
Grades 6+ to 7 high risk | 1.89% - 16.68% | 12,207,416 | 408,000 | - | 12,615,416 |
Carrying amount | 26,252,407 | 424,254 | - | 26,676,661 | |
Loss allowance | (83,669) | (772) | - | (84,441) | |
Commitments | |||||
Grades 1 to 4- low risk | 0.2% - 0.5% | 7,431,520 | - | - | 7,431,520 |
Grades 5+ to 5- fair risk | 0.73% - 3.04% | 57,298,798 | - | - | 57,298,798 |
Grades 6+ to 7 high risk | 0.96% - 17.41% | 96,185,167 | 10,328,231 | - | 106,513,398 |
Carrying amount | 160,915,485 | 10,328,231 | - | 171,243,716 | |
Loss allowance | (751,071) | (28) | - | (751,099) |
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2024 | |||||
12-month PD | Stage 1 | Stage 2 | Stage 3 | Total | |
ranges | USD | USD | USD | USD | |
Balances with the Central Bank of Malta, treasury bills and cash | |||||
Grades 1 to 4- low risk | 0.07% - 0.08% | 134,243,880 | - | - | 134,243,880 |
134,243,880 | - | - | 134,243,880 | ||
Loss allowance | (51,663) | - | - | (51,663) | |
Carrying amount | 134,192,217 | - | - | 134,192,217 | |
Loans and advances to banks | |||||
Grades 1 to 4- low risk | 0.08% - 0.69% | 72,295,044 | - | - | 72,295,044 |
Grades 5+ to 5- fair risk | 0.47% - 0.93% | 2,354,093 | - | - | 2,354,093 |
Grades 6+ to 7 high risk | 0.93% - 5.04% | 17,565,219 | 4,422,889 | - | 21,988,108 |
92,214,356 | 4,422,889 | - | 96,637,245 | ||
Loss allowance | (164,312) | (15,541) | - | (179,853) | |
Carrying amount | 92,050,044 | 4,407,348 | - | 96,457,392 | |
Loans and advances to customers | |||||
Grades 1 to 4- low risk | 0.05% - 0.94% | 27,475,262 | 196,197 | - | 27,671,459 |
Grades 5+ to 5- fair risk | 0.44% - 3.21% | 108,933,392 | 10,854,764 | - | 119,788,156 |
Grades 6+ to 7 high risk | 1.81% - 21.37% | 202,202,614 | 17,186,096 | - | 219,388,710 |
Grade 7- to 8- substandard | 11.81% - 17.1% | 40,527,255 | 24,054,932 | - | 64,582,187 |
Grade 9 to 10 doubtful/loss | 100% | - | - | 13,685,866 | 13,685,866 |
379,138,523 | 52,291,989 | 13,685,866 | 445,116,378 | ||
Loss allowance | (2,432,221) | (4,560,632) | (10,146,802) | (17,139,655) | |
Carrying amount | 376,706,302 | 47,731,357 | 3,539,064 | 427,976,723 | |
Financial investments at fair value through other comprehensive income | |||||
Grades 1 to 4- low risk | 0.02% - 0.46% | 120,265,095 | - | - | 120,265,095 |
Carrying amount at fair value | 120,265,095 | - | - | 120,265,095 | |
Loss allowance | (77,794) | - | - | (77,794) | |
Financial investments at amortised cost | |||||
Grades 1 to 4- low risk | 0.05% | 2,073,927 | - | - | 2,073,927 |
2,073,927 | - | - | 2,073,927 | ||
Loss allowance | (21) | - | - | (21) | |
Carrying amount | 2,073,906 | - | - | 2,073,906 | |
Guarantees | |||||
Grades 1 to 4- low risk | 0.41% - 0.78% | 225,193 | - | - | 225,193 |
Grades 5+ to 5- fair risk | 0.42% - 3.08% | 22,211,817 | 4,436 | - | 22,216,253 |
Grades 6+ to 7 high risk | 1.44% - 18.38% | 4,341,934 | 14,036 | - | 4,355,970 |
Grades 7- to 8- substandard | 19.78% | - | 831,082 | - | 831,082 |
Carrying amount | 26,778,944 | 849,554 | - | 27,628,498 | |
Loss allowance | (12,602) | - | - | (12,602) | |
Commitments | |||||
Grades 1 to 4- low risk | 0.08% - 0.94% | 23,279,472 | - | - | 23,279,472 |
Grades 5+ to 5- fair risk | 0.5% - 3.04% | 58,783,397 | 4,158,425 | - | 62,941,822 |
Grades 6+ to 7 high risk | 1.4% - 19.57% | 33,710,268 | 11,235,027 | - | 44,945,295 |
Grade 7- to 8- substandard | 19.55% | 1,038,853 | - | - | 1,038,853 |
Carrying amount | 116,811,990 | 15,393,452 | - | 132,205,442 | |
Loss allowance | (457,971) | (4,650) | - | (462,621) |
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2025 | |||||
12-month PD | Stage 1 | Stage 2 | Stage 3 | Total | |
ranges | USD | USD | USD | USD | |
Balances with the Central Bank of Malta, treasury bills and cash | |||||
Grades 1 to 4- low risk | 0.1% | 84,497,478 | - | - | 84,497,478 |
84,497,478 | - | - | 84,497,478 | ||
Loss allowance | (26,646) | - | - | (26,646) | |
Carrying amount | 84,470,832 | - | - | 84,470,832 | |
Loans and advances to banks | |||||
Grades 1 to 4- low risk | 0.13% - 0.59% | 26,956,387 | 343,458 | - | 27,299,845 |
Grades 5+ to 5- fair risk | 0.77% - 1.04% | 10,678,746 | - | - | 10,678,746 |
Grades 6+ to 7 high risk | 0.98% - 5.81% | 33,032,068 | 11,118,109 | - | 44,150,177 |
70,667,201 | 11,461,567 | - | 82,128,768 | ||
Loss allowance | (258,184) | (22,601) | - | (280,785) | |
Carrying amount | 70,409,017 | 11,438,966 | - | 81,847,983 | |
Loans and advances to customers | |||||
Grades 1 to 4- low risk | 0.18% - 0.69% | 379,331,438 | - | - | 379,331,438 |
Grades 5+ to 5- fair risk | 0.77% - 3.04% | 83,122,339 | 1,619,711 | - | 84,742,050 |
Grades 6+ to 7 high risk | 1.83% - 22.2% | 159,403,251 | 13,040,434 | - | 172,443,685 |
Grade 7- to 8- substandard | 29.16% | - | 7,009,447 | - | 7,009,447 |
Grade 9 to 10 doubtful/loss | 100% | - | - | 9,586,970 | 9,586,970 |
621,857,028 | 21,669,592 | 9,586,970 | 653,113,590 | ||
Loss allowance | (2,395,957) | (4,351,383) | (7,775,788) | (14,523,128) | |
Carrying amount | 619,461,071 | 17,318,209 | 1,811,182 | 638,590,462 | |
Financial investments at fair value through other comprehensive income | |||||
Grades 1 to 4- low risk | 0.06% - 0.27% | 105,254,684 | - | - | 105,254,684 |
Carrying amount at fair value | 105,254,684 | - | - | 105,254,684 | |
Loss allowance | (59,407) | - | - | (59,407) | |
Financial investments at amortised cost | |||||
Grades 1 to 4- low risk | 0.02% - 0.46% | 137,611,462 | - | - | 137,611,462 |
137,611,462 | - | - | 137,611,462 | ||
Loss allowance | (143,610) | - | - | (143,610) | |
Carrying amount | 137,467,852 | - | - | 137,467,852 | |
Guarantees | |||||
Grades 1 to 4- low risk | 0.18% - 0.46% | 722,551 | - | - | 722,551 |
Grades 5+ to 5- fair risk | 0.74% - 2.98% | 13,322,440 | 16,254 | - | 13,338,694 |
Grades 6+ to 7 high risk | 1.89% - 16.68% | 12,207,416 | 408,000 | - | 12,615,416 |
Carrying amount | 26,252,407 | 424,254 | - | 26,676,661 | |
Loss allowance | (83,669) | (772) | - | (84,441) | |
Commitments | |||||
Grades 1 to 4- low risk | 0.26% - 0.5% | 7,709,441 | - | - | 7,709,441 |
Grades 5+ to 5- fair risk | 0.73% - 3.04% | 57,298,798 | - | - | 57,298,798 |
Grades 6+ to 7 high risk | 0.96% - 17.41% | 91,954,714 | 10,328,231 | - | 102,282,945 |
Carrying amount | 156,962,953 | 10,328,231 | - | 167,291,184 | |
Loss allowance | (751,084) | (28) | - | (751,112) |
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2024 | |||||
12-month PD | Stage 1 | Stage 2 | Stage 3 | Total | |
ranges | USD | USD | USD | USD | |
Balances with the Central Bank of Malta, treasury bills and cash | |||||
Grades 1 to 4- low risk | 0.07% - 0.08% | 134,230,953 | - | - | 134,230,953 |
134,230,953 | - | - | 134,230,953 | ||
Loss allowance | (51,663) | - | - | (51,663) | |
Carrying amount | 134,179,290 | - | - | 134,179,290 | |
Loans and advances to banks | |||||
Grades 1 to 4- low risk | 0.08% - 0.69% | 69,444,715 | - | - | 69,444,715 |
Grades 5+ to 5- fair risk | 0.47% | 514,486 | - | - | 514,486 |
Grades 6+ to 7 high risk | 0.93% - 1.95% | 15,894,835 | 4,422,889 | - | 20,317,724 |
85,854,036 | 4,422,889 | - | 90,276,925 | ||
Loss allowance | (163,260) | (15,541) | - | (178,801) | |
Carrying amount | 85,690,776 | 4,407,348 | - | 90,098,124 | |
Loans and advances to customers | |||||
Grades 1 to 4- low risk | 0.08% - 0.94% | 295,464,276 | - | - | 295,464,276 |
Grades 5+ to 5- fair risk | 0.5% - 3.04% | 65,347,585 | 9,513,551 | - | 74,861,136 |
Grades 6+ to 7 high risk | 1.81% - 21.37% | 126,138,895 | 16,885,557 | - | 143,024,452 |
Grade 7- to 8- substandard | 11.81% - 17.1% | 23,873 | 7,016,575 | - | 7,040,448 |
Grade 9 to 10 doubtful/loss | 100% | - | - | 12,886,098 | 12,886,098 |
486,974,629 | 33,415,683 | 12,886,098 | 533,276,410 | ||
Loss allowance | (1,935,067) | (4,116,527) | (9,440,905) | (15,492,499) | |
Carrying amount | 485,039,562 | 29,299,156 | 3,445,193 | 517,783,911 | |
Financial investments at fair value through other comprehensive income | |||||
Grades 1 to 4- low risk | 0.02% - 0.46% | 120,265,095 | - | - | 120,265,095 |
Carrying amount at fair value | 120,265,095 | - | - | 120,265,095 | |
Loss allowance | (77,794) | - | - | (77,794) | |
Financial investments at amortised cost | |||||
Grades 1 to 4- low risk | 0.05% | 2,073,927 | - | - | 2,073,927 |
2,073,927 | - | - | 2,073,927 | ||
Loss allowance | (21) | - | - | (21) | |
Carrying amount | 2,073,906 | - | - | 2,073,906 | |
Guarantees | |||||
Grades 1 to 4- low risk | 0.41% - 0.78% | 229,247 | - | - | 229,247 |
Grades 5+ to 5- fair risk | 0.42% - 3.08% | 22,211,817 | 4,436 | - | 22,216,253 |
Grades 6+ to 7 high risk | 1.44% - 18.38% | 4,341,934 | 14,036 | - | 4,355,970 |
Grade 7- to 8- substandard | 19.78% | - | 831,082 | - | 831,082 |
Carrying amount | 26,782,998 | 849,554 | - | 27,632,552 | |
Loss allowance | (12,606) | - | - | (12,606) | |
Commitments | |||||
Grades 1 to 4- low risk | 0.08% - 0.94% | 5,283,377 | - | - | 5,283,377 |
Grades 5+ to 5- fair risk | 0.5% - 3.04% | 58,783,396 | 4,158,425 | - | 62,941,821 |
Grades 6+ to 7 high risk | 1.4% - 19.57% | 31,130,485 | 11,235,027 | - | 42,365,512 |
Grade 7- to 8- substandard | 19.55% | 1,038,853 | - | - | 1,038,853 |
Carrying amount | 96,236,111 | 15,393,452 | - | 111,629,563 | |
Loss allowance | (193,869) | (4,650) | - | (198,519) |
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2025 | |||||
12-month PD | |||||
ranges | Stage 1 | Stage 2 | Stage 3 | Total | |
USD | USD | USD | USD | ||
Assets classified as held for sale | |||||
Loans and advances to banks | |||||
Grades 1 to 4- low risk | 0.2% | 5,499 | - | - | 5,499 |
Grades 5+ to 5- fair risk | 0.54% - 0.66% | 55,282 | - | - | 55,282 |
Grades 6+ to 7 high risk | 1.18% - 1.48% | 3,917,500 | - | - | 3,917,500 |
Grade 7- to 8- substandard | 13.52% | 7,132 | - | - | 7,132 |
3,985,413 | - | - | 3,985,413 | ||
Loss allowance | (20) | - | - | (20) | |
Carrying amount | 3,985,393 | - | - | 3,985,393 | |
Loans and advances to customers | |||||
Grade 7- to 8- substandard | 10.28% - 15.32% | 45,974,620 | 18,367,559 | - | 64,342,179 |
Grade 9 to 10 doubtful/loss | 100% | - | - | 2,516,329 | 2,516,329 |
45,974,620 | 18,367,559 | 2,516,329 | 66,858,508 | ||
Loss allowance | (1,387,725) | (538,888) | (1,461,559) | (3,388,172) | |
Carrying amount | 44,586,895 | 17,828,671 | 1,054,770 | 63,470,336 |
2025 | ||||
Stage 1 | Stage 2 | Stage 3 | Total | |
USD | USD | USD | USD | |
Loans and advances to banks | ||||
Current | 76,822,088 | 11,127,448 | - | 87,949,536 |
Overdue < 30 days | - | 361,922 | - | 361,922 |
Total gross carrying amount | 76,822,088 | 11,489,370 | - | 88,311,458 |
Loans and advances to customers | ||||
Current | 372,708,961 | 17,641,017 | - | 390,349,978 |
Overdue < 30 days | 45,743,570 | 4,901,947 | - | 50,645,517 |
Overdue between 30 and 90 days | - | 2,282,292 | - | 2,282,292 |
Overdue > 90 days | - | - | 9,962,729 | 9,962,729 |
Total gross carrying amount | 418,452,531 | 24,825,256 | 9,962,729 | 453,240,516 |
Assets classified as held for sale | ||||
Current | 49,383,102 | 18,367,559 | - | 67,750,661 |
Overdue < 30 days | 576,931 | - | - | 576,931 |
Overdue > 90 days | - | - | 2,516,329 | 2,516,329 |
Total gross carrying amount | 49,960,033 | 18,367,559 | 2,516,329 | 70,843,921 |
FIMBank Group Annual Report & Financial Statements 2025
97
2024 | ||||
Stage 1 | Stage 2 | Stage 3 | Total | |
USD | USD | USD | USD | |
Loans and advances to banks | ||||
Current | 92,214,356 | 2,509,549 | - | 94,723,905 |
Overdue < 30 days | - | 1,913,340 | - | 1,913,340 |
Total gross carrying amount | 92,214,356 | 4,422,889 | - | 96,637,245 |
Loans and advances to customers | ||||
Current | 318,777,405 | 30,192,218 | - | 348,969,623 |
Overdue < 30 days | 60,361,118 | 21,667,765 | - | 82,028,883 |
Overdue between 30 and 90 days | - | 432,006 | - | 432,006 |
Overdue > 90 days | - | - | 13,685,866 | 13,685,866 |
Total gross carrying amount | 379,138,523 | 52,291,989 | 13,685,866 | 445,116,378 |
2025 | ||||
Stage 1 | Stage 2 | Stage 3 | Total | |
USD | USD | USD | USD | |
Loans and advances to banks | ||||
Current | 70,667,201 | 11,099,645 | - | 81,766,846 |
Overdue < 30 days | - | 361,922 | - | 361,922 |
Total gross carrying amount | 70,667,201 | 11,461,567 | - | 82,128,768 |
Loans and advances to customers | ||||
Current | 593,627,471 | 15,116,450 | - | 608,743,921 |
Overdue < 30 days | 28,229,557 | 4,391,636 | - | 32,621,193 |
Overdue between 30 and 90 days | - | 2,161,506 | - | 2,161,506 |
Overdue > 90 days | - | - | 9,586,970 | 9,586,970 |
Total gross carrying amount | 621,857,028 | 21,669,592 | 9,586,970 | 653,113,590 |
2024 | ||||
Stage 1 | Stage 2 | Stage 3 | Total | |
USD | USD | USD | USD | |
Loans and advances to banks | ||||
Current | 85,854,036 | 2,509,549 | - | 88,363,585 |
Overdue < 30 days | - | 1,913,340 | - | 1,913,340 |
Total gross carrying amount | 85,854,036 | 4,422,889 | - | 90,276,925 |
Loans and advances to customers | ||||
Current | 449,881,376 | 12,434,905 | - | 462,316,281 |
Overdue < 30 days | 37,093,253 | 20,980,778 | - | 58,074,031 |
Overdue > 90 days | - | - | 12,886,098 | 12,886,098 |
Total gross carrying amount | 486,974,629 | 33,415,683 | 12,886,098 | 533,276,410 |
FIMBank Group Annual Report & Financial Statements 2025
98
Group | ||
2025 | 2024 | |
USD | USD | |
Trading assets | ||
Rated A- to A+ | 25,493,140 | 2,006,599 |
Rated BBB+ or below | 231,301,147 | 124,681,473 |
Unrated | 188,002,115 | 148,045,226 |
Carrying amount | 444,796,402 | 274,733,298 |
4.2.1.5 Reconciliation of gross carrying amounts and allowances for expected credit losses
FIMBank Group Annual Report & Financial Statements 2025
99
Non-credit impaired | Credit impaired | |||||||
Stage 1 | Stage 2 | Stage 3 | Total | |||||
Gross carrying | Allowance | Gross carrying | Allowance | Gross carrying | Allowance | Gross carrying | Allowance | |
amount | for ECL | amount | for ECL | amount | for ECL | amount | for ECL | |
USD | USD | USD | USD | USD | USD | USD | USD | |
Loans and advances to customers | ||||||||
Balance at 1 January | 379,138,523 | (2,432,221) | 52,291,989 | (4,560,632) | 13,685,866 | (10,146,802) | 445,116,378 | (17,139,655) |
Transfer to Stage 1 | 5,544,098 | (6,739) | (5,544,098) | 6,739 | - | - | - | - |
Transfer to Stage 2 | (7,371,226) | 113,995 | 7,371,226 | (113,995) | - | - | - | - |
Net remeasurement of loss allowance arising from stage transfers | - | 6,739 | - | (162,028) | - | - | - | (155,289) |
Changes in risk parameters | - | 103,948 | - | 29,304 | - | 112,025 | - | 245,277 |
New financial assets originated or purchased and further lending | 334,203,077 | (1,842,409) | 5,632,588 | (8,259) | - | - | 339,835,665 | (1,850,668) |
Financial assets that have been repaid or partially repaid | (256,904,226) | 801,053 | (19,414,108) | 16,208 | (1,309,898) | 718,719 | (277,628,232) | 1,535,980 |
Financial assets reclassified to discontinued operations | (42,634,996) | 901,095 | (17,038,357) | 438,900 | (401,324) | 307,457 | (60,074,677) | 1,647,452 |
Write-offs | - | - | - | - | (2,667,657) | 1,303,120 | (2,667,657) | 1,303,120 |
Foreign exchange and other movements | 6,477,281 | 23,514 | 1,526,016 | (735) | 655,742 | (446,061) | 8,659,039 | (423,282) |
Balance at 31 December | 418,452,531 | (2,331,025) | 24,825,256 | (4,354,498) | 9,962,729 | (8,151,542) | 453,240,516 | (14,837,065) |
ECL change for the period | 2,302,590 | |||||||
Assets written off | (2,667,657) | |||||||
Change in expected credit losses excluding effect of write-offs | (365,067) | |||||||
Recoveries | 1,350,821 | |||||||
Foreign exchange and other movements | 423,282 | |||||||
ECL attributable to discontinued operations at 1 January 2025 | (1,647,452) | |||||||
Change in expected credit losses and other credit impairment charges | (238,416) |
As at 31 December 2025 | Twelve months ended 31 December 2025 | ||
Gross carrying/ | Allowance | Net movement in expected credit losses and | |
Nominal amount | for ECL | other credit impairment charges | |
USD | USD | USD | |
Balances with Central Bank of Malta, treasury bills and cash | 84,522,623 | (26,646) | 25,017 |
Loans and advances to banks | 88,311,458 | (294,714) | (114,861) |
Loans and advances to customers | 453,240,516 | (14,837,065) | (238,416) |
Financial investments at amortised cost | 41,300,504 | (6,045) | (6,024) |
Off-balance sheet | |||
- Guarantees | 26,676,661 | (84,441) | (71,839) |
- Commitments | 171,243,716 | (751,099) | (288,478) |
Summary of financial instruments to which the impairment requirements in IFRS 9 are applied in income statement | 865,295,478 | (16,000,010) | (694,601) |
Financial investments at fair value through other comprehensive income | 105,254,684 | (59,407) | 18,387 |
Total allowance for ECL/Total income statement ECL charge | (16,059,417) | (676,214) |
FIMBank Group Annual Report & Financial Statements 2025
100
Non-credit impaired | Credit impaired | |||||||
Stage 1 | Stage 2 | Stage 3 | Total | |||||
Gross carrying | Allowance | Gross carrying | Allowance | Gross carrying | Allowance | Gross carrying | Allowance | |
amount | for ECL | amount | for ECL | amount | for ECL | amount | for ECL | |
Loans and advances to customers | USD | USD | USD | USD | USD | USD | USD | USD |
Balance at 1 January | 348,322,143 | (1,992,933) | 74,817,853 | (3,235,201) | 27,115,371 | (13,685,159) | 450,255,367 | (18,913,293) |
Transfer to Stage 1 | 8,117,042 | (163,525) | (8,117,042) | 163,525 | - | - | - | - |
Transfer to Stage 2 | (12,550,486) | 44,257 | 12,550,486 | (44,257) | - | - | - | - |
Transfer to Stage 3 | - | - | (826,664) | 14,774 | 826,664 | (14,774) | - | - |
Net remeasurement of loss allowance arising from stage transfers | - | (19,442) | - | 12,541 | - | (305,675) | - | (312,576) |
Changes in risk parameters | - | 83,145 | - | (1,502,211) | - | (3,574,526) | - | (4,993,592) |
New financial assets originated or purchased and further lending | 432,469,819 | (1,470,719) | 18,556,170 | (144,706) | 40,221 | (40,221) | 451,066,210 | (1,655,646) |
Financial assets that have been repaid or partially repaid | (382,567,759) | 1,079,287 | (39,828,212) | 174,762 | (8,149,871) | 3,699,466 | (430,545,842) | 4,953,515 |
Write-offs | - | - | - | - | (4,672,416) | 3,279,949 | (4,672,416) | 3,279,949 |
Foreign exchange and other movements | (14,652,236) | 7,709 | (4,860,602) | 141 | (1,474,103) | 494,138 | (20,986,941) | 501,988 |
Balance at 31 December |