Contents
Chairman’s statement to the shareholders
1
FIMBank group performance 2023
2
Directors’ report
5
Statement of compliance with the principles of good corporate governance
13
Remuneration report
24
Financial statements:
Statements of financial position
40
Statements of profit or loss
42
Statements of other comprehensive income
43
Statements of changes in equity
44
Statements of cash flows
48
Notes to the financial statements
50
Statement by the directors pursuant to Capital Markets Rule 5.68
194
Schedules to the annual report
Statements of profit or loss – 5 year summary
195
Statements of financial position – 5 year summary
196
Cash flow statements – 5 year summary
197
Accounting ratios – 5 year summary
198
Directors and executive management
199
FIMBank Group Annual Report & Financial Statements 2023
1
Chairman’s statement to the shareholders
Dear Shareholder,
As we close off another fiscal year, I take this opportunity to share my reflections on the Bank’s journey throughout the past twelve months. Although
the year brought about a number of challenges, we have once again demonstrated our resilience and commitment. The Bank’s unwavering focus
towards value creation for its clients and stakeholders enabled it to charter its path to offset the various obstacles faced during the year. The year
2023 unfolded within a global backdrop marked by elevated inflation levels, posing significant challenges for governments, central banks, individuals,
and businesses alike. The persistent conflict in Ukraine and escalating tensions in the Middle East as the year progressed were also main contributors
to global uncertainty.
For the period ending 31 December 2023, the FIMBank Group recorded a significant turnaround, registering a pre-tax profit of USD5.8 million, an
important development in comparison to the pre-tax loss of USD24.7 million in the previous year. Post-tax, the Bank achieved a break-even
performance, resulting in a profit of USD7,674. During 2023, the Group experienced considerable financial shifts, underscored by a 20% increase in
operating income, reaching USD54.8 million, supported by a favourable interest rate environment, alongside a 42% increase in net operating results
to USD11.4 million. In line with our efforts across the past years, the Group maintained a commitment to asset quality with a notable reduction in
net impairment losses and a decrease in the Non-Performing Loan Ratio. The turnaround that has been registered is a result of the ongoing recovery
efforts undertaken over the past years as the team worked relentlessly to improve the quality of our portfolio. The dedication of our Bank's
Management should not be underestimated. The role that they play is of crucial importance as we collectively strive towards the realisation of our
financial objectives.
While Group results mark a considerable improvement and demonstrate that a well-executed plan of action is starting to yield sustainable results,
it is crucial to convey that as Chairman, merely achieving break-even does not represent the slightest of our ambitions. With a strong foundation,
supported by an international network of offices in four continents and an expert team dedicated to excellence, we are uniquely positioned to
capitalise on our transformational efforts and achieve our aspirational goals. Looking ahead, we anticipate a promising 2024 with accelerated
performance improvements.
FIMBank also deems investor relations to be of utmost importance. Our actions in this respect are characterised by transparency and honesty.
Throughout the year, we have steadfastly upheld our commitment to actively engage with all our stakeholders. Central to our philosophy is the
principle of forthrightness, ensuring that both positive developments and challenges are communicated in a realistic manner, in keeping with the
professional standards expected of us.
It is with a sense of profound gratitude that I acknowledge the trust and loyalty our shareholders have shown us. I must extend special appreciation
to our majority shareholder, the KIPCO Group, for their resolute and continued support over the years. Their consistent backing has been
instrumental in helping us to navigate through the complexities of an ever-evolving landscape, providing encouragement as we continue to drive
towards our strategic ambitions.
I wish to take this opportunity to express my gratitude and appreciation to former CEO Mr. Adrian Gostuski for his commitment to strengthening
the foundation of the Bank, his dedication, and hard work during the last four years. His contribution will be remembered for years to come and
serves as a lasting testament to his leadership. I take this occasion to congratulate and welcome Mr. Mohammed Louhab, following his recent
appointment as Group Chief Executive Officer. I am confident that under the guidance of our new GCEO, the Bank will continue to build upon its
solid foundations and progress further in achieving sustainable results and complete its turnaround.
In closing, I wish to express my gratitude and appreciation to the Directors, Management, and employees of the FIMBank Group. We remain grateful
for their invaluable contribution and tireless efforts in executing our strategic objectives. Together, we have navigated another challenging year,
and I am confident in our collective ability to embrace and capitalise on the opportunities that lie ahead.
Signed by John C. Grech (Chairman) on 24 April 2024
FIMBank Group Annual Report & Financial Statements 2023
2
FIMBank Group performance 2023
CEO’s message
As we review the financial year ending 31 December 2023, it is with a sense of grounded optimism that I share our Group's performance details
with you. The financial year has been one of substantial improvement for FIMBank Group, marking a significant turnaround, posting a pre-tax profit
of USD5.8 million. This reflects a remarkable improvement from the previous year, where we reported a pre-tax loss of USD24.7 million. The financial
results of 2023 are the culmination of the efforts undertaken over the past years and serve as a strong indicator that the transformation that the
Group has undertaken is starting to yield results.
Midway through the year, our interim results indicated an encouraging upward trend in performance, suggesting the potential for an even more
favourable outcome by the end of the year. This was overshadowed by an increase in corporate tax, with the year-end results showing a modest
post-tax profit of USD7,674, effectively break-even. Notwithstanding, this remains a noteworthy recovery from the previous financial years.
I am pleased to report that for the fourth year running there are no new material non-performing loans. Banks with strong risk management,
diversified portfolios, and effective recovery processes are always better positioned to maintain lower non-performing ratios, and our objective is
to continue building on these positive recovery results in the years ahead. We are confident that our focus on robust risk management practices,
diversified portfolios, and efficient recovery processes will continue to enhance these ratios.
Since my appointment as Group Chief Executive Officer of the Bank on 30 November 2023, I have witnessed firsthand the resilience and
determination with which our team continues to overcome our existing challenges. As we look ahead, we see a stable business model that is poised
to capitalise on growth opportunities and business potential within the international and local markets. Our commitment to marching towards
sustainable growth, driven by our collective efforts, is aimed at forging a prosperous future that maximises shareholder value.
Overview of financial results
During this financial period, net interest income increased by 26% year on year, reaching USD55.2 million. This increase is primarily attributed to
the favourable interest rate environment, which allowed the Group to expand its interest margins. Moreover, the net fees and commission expense
saw a marked improvement, reducing to USD0.7 million, a decrease of USD1.2 million from the previous year. Operating results from the non-
trading portfolio increased by USD9.1 million to USD54.8 million, reflecting a growth of 20% over the previous year. The increase in operating results
from the non-trading portfolio reflects the successful execution of our diversified business strategy.
Turning our focus to trading performance, although we recorded a net trading loss of USD3.2 million for the year, this represents a significant
recovery from the previous year's USD6.9 million loss. The Group's trading operations encountered challenges stemming from the pervasive impact
of geopolitical unrest and fluctuations in economic policies within the primary markets we operate in. This situation was further exacerbated by the
default of an asset in our LFC subsidiary's trading book. Even in the face of these challenges, our strategic actions have been geared towards
minimizing impacts and ensuring financial stability. Through diligent planning and proactive measures, we remain steadfast in our commitment to
mitigating adverse effects and strengthening our financial resilience.
As of 31 December 2023, the Group’s total consolidated assets increased by 1.60% to USD1.58 billion, reflecting a prudent yet strategic approach
to steadily managing our asset size and capital positions. The Group’s consolidated liabilities increased slightly to USD1.40 billion, following the shift
of focus towards broadening the Bank’s deposit base through an enhanced emphasis on diversifying funding sources. During the period, customer
deposits increased by 6.7% to USD935 million. This was complemented by a strategic stance that actively promotes franchise deposits, targeting
stable, lower-cost deposits generated through our established reputation and strong customer relationships.
The Group’s Common Equity Tier 1 Ratio and TCR ratios stood at 18.3%, well above the overall capital requirements and supervisory pillar two
guidance.
Achieving a 6.46% reduction in the Non-Performing Loan (“NPL”) Ratio demonstrates our commitment to maintaining a healthy and resilient
portfolio. This result is a testament to our rigorous management of assets and our successful efforts in reducing net impairment losses.
Our financial performance has demonstrated remarkable improvement that encourages us to build on these results. Our strategic initiatives are
setting the stage for sustainability. As we progress further in our journey, our focus remains on optimizing our operational efficiency, solidifying our
risk management framework, and expanding our revenue generation capabilities, delivering superior value to our customers and shareholders. The
diverse business units within the bank are actively demonstrating their strong capabilities in originating new business, with a robust pipeline of
transactions consistently being converted, showcasing a dynamic and healthy business origination environment.
FIMBank Group Annual Report & Financial Statements 2023
3
Business unit performance
Trade Finance
The Bank continues to prioritise Trade Finance as one of its core businesses. During the year, the Trade Finance team successfully maintained a
steady client base while also integrating a select group of new clients. This diligent approach culminated in a notable uptick in trade finance volumes.
A significant effort was devoted to enhancing operational efficiency throughout 2023, including updated risk frameworks, streamlined processes,
upgrading of technology, and revised policies. These strategic improvements were aimed at optimizing service delivery. FIMBank is renowned for
its expertise in maritime finance, offering tailored banking and finance services for the shipping industry from a base in Dubai. In response to
emerging market dynamics, the Bank renewed its focus on re-entering trade finance operations within a select number of African countries.
Following the strategic decision taken the previous year, the Greek portfolio was transferred to Malta, and during 2023 continued to be managed
by a dedicated team of factoring specialists. The portfolio size remains stable, and this realignment has led to notable performance improvements.
Corporate Finance
Beyond trade finance, the local lending activity began with the establishment of the Real Estate Finance unit in 2016, offering project financing for
residential and commercial projects in Malta. Over the past eight years, the Real Estate portfolio has consistently delivered positive results,
maintaining portfolio stability at the desired levels. After achieving success in this sector and securing a substantial market share, the Bank took a
significant step forward in 2023 with the launch of its Corporate Finance proposition. This initiative spearheaded the development of a
comprehensive suite of financial solutions tailored specifically for corporate clients. The corporate offering includes business loans, overdrafts,
general banking facilities, and revolving loans, aimed at meeting the diverse needs of businesses operating in Malta. This initiative has resulted in
stable growth and heightened visibility in the home market, positioning the Bank to capitalise on potential opportunities for increased business and
diversification. Corporate Finance is well-positioned to grow in a sustainable manner while reinforcing the Bank’s presence and visibility in its home
country.
London Forfaiting Company Ltd (“LFC”)
The year 2023 was a very successful one for LFC, which returned a net profit after tax of USD8.64 million (2022: USD0.73 million) to its shareholder.
LFC also embarked on a strategy of diversifying its portfolio last year. LFC takes a proactive approach to managing its non-performing assets, and
whilst there was one new non-payment in 2023, this was fully provided for during the year. LFC experienced a general increase in underlying interest
rates following the tightening of monetary policy in many of the developed and developing economies. This trend was particularly relevant in
countries where LFC operates, significantly contributing to an enhancement in the company's profitability in 2023. Significantly, LFC celebrates its
40th anniversary in 2024, and its ability to adapt to constant economic and operational changes in the environment where it operates stands as a
testament to its longevity, robustness, and resilient business model.
India Factoring and Finance Solutions Private Ltd (“India Factoring”)
During the year in review, India Factoring registered a profit of USD0.30 million, compared to a loss of USD0.70 million registered in 2022. India
Factoring retained its leadership position in the provision of factoring services in India for the sixth consecutive year. The company continues to
support small and medium enterprises with tailor-made working capital solutions. Clients benefit from access to immediate liquidity, to smooth out
cash requirements, improve financial planning, and more importantly, optimise their financials. In 2023, India Factoring maintained its portfolio at
a similar level to that of the previous year in spite of various challenges such as geopolitical tensions, inflationary trends, rising interest rates, etc.
Despite strong outperformance in terms of operational profit, the subsidiary experienced an increase in provisions and deferred tax asset charge,
which impacted the overall performance. The increase in provisions was on account of one legacy domestic relationship. The company’s
performance of its export book has been strong, and its current portfolio status remains excellent.
The Egyptian Company for Factoring S.A.E. (“Egypt Factors”)
Egypt Factors registered a profit of USD1.9 million and an increase in its factoring portfolio during 2023. The subsidiary was the first licensed Egyptian
company specializing in factoring services, it is considered a pioneer in the financial services sector in Egypt and maintained its leading market
position measured by market share. It has consistently maintained its premier market position, as evidenced by its substantial market share. Egypt
Factors has built a strong reputation for its responsiveness to client needs, primarily through providing high-quality accounts receivable
management. This approach supports suppliers in fulfilling buyer expectations.
FIMBank Group Annual Report & Financial Statements 2023
4
Investment in technology
Digital and technology serve as indispensable catalysts for modern banking, and FIMBank has wholeheartedly embraced this ethos through
continuous investment over the years. In 2023, we achieved several significant milestones in our digital transformation voyage. Among our top
priorities was the enhancement of our digital banking platform, FIMBank Direct, for which most of the work was concluded in 2023. Our primary
focus remains on enriching our customers' digital experiences and broadening the platform's functional capabilities, thereby empowering them to
seamlessly manage their banking needs with heightened security. Throughout 2023, we have made substantial progress in replacing the legacy
Group factoring operating system with a successful migration to a new platform for our India business. The Bank also embarked on a new payments
project hub which is set to be launched in 2024. This initiative falls in line with the Bank’s commitment to modernise its payments framework and
support industry changes. These enhancements further solidify our dedication to innovation and excellence in banking services.
Corporate Social Responsibility
At FIMBank we believe that our actions have a direct impact upon the community in which we operate. During the period of 2023, the Bank has
sought to embark on a number of initiatives to support organisations making valid contributions to society. The Bank, along with its employees,
collectively contributed to Puttinu Cares through an internal initiative that supplemented the Bank’s own charitable donation. FIMBank supported
Pink October and Movember initiatives aimed at raising awareness for men's and women's health. Bank employees were encouraged to wear pink
or blue at the workplace to show solidarity towards the cause and enjoyed some sweet baked treats, all while collecting donations for Hospice
Malta.
Earlier in the year, the Bank backed the Valletta Concours event as part of its CSR program, celebrating automotive heritage and cultural
preservation. This sponsorship fosters historical appreciation through the showcasing of vintage and classic automobiles, educational platforms for
enthusiasts of all ages, while also bolstering tourism. Such engagement reflects a dedication to CSR by investing in initiatives that enrich lives and
promote sustainable cultural practices and community involvement.
Environmental, Social and Corporate Governance principles (ESG)
The FIMBank Group acknowledges the growing importance of Environmental, Social, and Governance (“ESG”) standards and our responsibility in
advancing sustainable practices. As an organisation operating in various continents across the globe, we have a direct influence on the well-being
of individuals across numerous countries, evident through our role as an employer, the nature of our products and services, and our broader impact
on the environment and local communities.
At FIMBank, we pledge to embed ESG considerations into our business strategy, facilitating the integration of sustainability principles into our
decision-making processes. We are steadfast in our belief that by championing sustainable practices, we contribute to forging a more resilient future
for all stakeholders, including customers, shareholders, employees, and broader society. As we continue to embed ESG into our operational
framework, we strive to effect positive change and uphold our duty as a responsible corporate entity.
We have engaged external consultants to aid in implementing an ESG framework within our organisation. This framework serves to align our efforts
with the European Union's ESG objectives and proactively manage environmental risks affecting the Group, our clientele, and society at large.
Concluding remarks
Whilst recent results have shown that recent efforts spearheaded over the years are now starting to bear fruit, our business approach remains
grounded and cautious, as we acknowledge that we must undertake more work. The priorities for 2024 have been clearly defined: the maximisation
of revenues through high-quality, good-yielding assets across various verticals while emphasizing a heightened awareness toward our cost base.
Furthermore, assessing capital consumption is instrumental in achieving higher returns and strategically balancing our portfolios to ensure optimal
performance. I am confident that with an approach focusing on collective collaboration, we will achieve our objectives.
I extend my gratitude to our dedicated team, our Board of Directors, and our stakeholders for their unwavering support and commitment to our
vision. Together, we are poised for success in the years to come.
Signed by Mohammed Louhab (Chief Executive Officer) on 24 April 2024
FIMBank Group Annual Report & Financial Statements 2023
5
Directors’ report
For the year ended 31 December 2023
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 2023. 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
The Group and the Bank reported a profit after tax of USD7,674 and USD2,490,148 respectively, for the year under review.
Further information about the results are provided in the Statements of Profit or Loss and the Statements of Other Comprehensive Income on pages
42 and 43 and in the Review of Performance section within this report.
Group structure and principal activities
The Group comprises the Bank and its wholly owned subsidiaries, London Forfaiting Company Limited (“LFC”), FIM Business Solutions Limited
(“FBS”), 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”), whilst 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 principally active in providing international trade finance and to act as an intermediary to other financial
The Bank has a branch registered with the Dubai International Finance Centre, United Arab Emirates, which is regulated by the Regulator 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 companies and banks.
• FBS (100%), registered in Malta, has as its primary purpose the provision of information technology and support services to the Group.
Please refer to Note 47 to the Financial Statements for information about the subsequent events of this entity.
• 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 part ies 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 (88.16%), incorporated in Mumbai, India, is to carry out the business of factoring in
India. India Factoring is regulated by the Reserve Bank of India: and
b. BrasilFactors S.A. (50%), is an equity-accounted investee incorporated in São Paulo, Brazil, with its core business focused on factoring services,
targeting small and medium-sized companies. The other shareholder in this company is China Construction Bank (50%).
FIMBank Group Annual Report & Financial Statements 2023
6
Review of performance
The financial period ending on 31 December 2023 marked a significant turnaround in both operating and financial performance for the Group. There
was a substantial shift from a pre-tax loss of USD24.7 million in the preceding financial period ending on 31 December 2022 to a pre-tax profit of
USD5.8 million in the current period. Furthermore, the Group achieved break-even post-tax, with a profit of USD7,674 for the financial period ending
on 31 December 2023, a remarkable improvement compared to the loss of USD26.7 million reported in the previous year.
The economic landscape in 2023 presented a myriad of simultaneous developments, making it quite complex to capture comprehensively. Amidst
the ongoing global recovery from the lingering effects of the COVID-19 pandemic, tensions continued to escalate in Eastern Europe, intensifying the
persisting cost-of-living crisis. Simultaneously, tensions heightened in the Middle East due to the Israel-Hamas conflict, leading to recent attacks on
shipping in the Red Sea that disrupted supply chains and sharply increased shipping costs.
Despite experiencing a faster-than-expected decline in inflation, it remained stubbornly high, prompting central banks to persist in raising interest
rates. This, in turn, increased borrowing costs and posed significant challenges for private individuals, corporations, and industries sensitive to
interest rates, such as manufacturing and business investment. Economic growth exhibited variability, with some economies surpassing expectations
while others remained subdued due to weak consumer sentiment and the lingering effects of high energy prices and inflationary pressures.
Nonetheless, there were discernible signs of supply-side expansion, including a broad-based increase in labour force participation, resolution of
pandemic-era supply chain disruptions, and decreasing delivery times.
The persistently high interest rate environment presents both advantages and drawbacks for the Group. On the positive side, it has contributed to
boosting the net interest margin, which reached USD55.2 million, as the rise in interest income surpassed the increase in interest expenses. Despite
the general negative impact of increasing interest rates on the fair valuation of trading assets, this effect was mitigated by a prudent risk focused
approach applied in managing the trading book. The average tenor of the trading book was kept short (under one year), and the majority of the
assets were linked to a floating rate, which helped mitigate any adverse effects from high interest rates.
The Group has persistently pursued the recovery of its legacy portfolio, yielding tangible results with a recovery exceeding USD16 million from
various non-performing clients. The ongoing de-risking efforts over the past few years have proven fruitful, with no material exposures classified as
non-performing for the third consecutive year. Furthermore, the Group conducted a thorough review of non-performing exposures, resulting in the
write-off of several fully provided exposures where remote recovery prospects were identified. This strategic action not only improved the Group's
asset quality and regulatory metrics, but also freed up Management’s resources to focus on other recovery initiatives while safeguarding and
improving the performing portfolio.
During the financial year ended 31 December 2023, Management has reconsidered its position on the reclassification of its long-term debt securities.
In 2022, the Group reclassified this portfolio from ‘Financial investments at fair value through other comprehensive income’ to ‘Financial investments
at amortised cost’. In 2023, the Group reclassified this portfolio back to ‘Financial investments at fair value through other comprehensive income’.
This decision followed various developments in the market surrounding interpretations of IFRS 9 requirements, in relation to reclassifications of
financial instruments between different classification and measurement categories. Please refer to Note 25.2 for further information on this
reclassification.
In the review period, the Group continued its medium-term strategy of refining its structure. Notably, efforts were directed towards finalising a
merger by acquisition between the Bank and FIM Business Solutions Limited, a process expected to conclude in 2024. This strategic initiative aims
to streamline the Group's business model and reduce operating expenses, aligning with its long-term objectives.
Notwithstanding the unpredictable operating environment due to ongoing conflicts in Eastern Europe and the Middle East, as well as monetary and
fiscal policies in its markets, LFC had an excellent year, closing with a USD11.3 million profit before tax compared to USD1.5 million in the previous
year. As a result of these strong financial results, LFC has fully utilized all of its deferred tax assets. Additionally, LFC closed the year with a trading
portfolio 16% lower than the previous year, reflecting the entity’s selective approach to emerging market exposures. LFC adopted a cautious
approach in managing its trading portfolio through sound credit assessment, insurance capacity, and enhanced oversight.
India Factoring maintained its factoring portfolio at a level similar to the previous year, while surpassing the previous year’s operating profits by
USD0.7 million. The entity increased its provision for a specific legacy group of connected clients due to delays in the recovery process while recorded
some recoveries and released some expected credit losses. As a result, the entity closed the year with a profit before tax of USD1.6 million, compared
to a loss of USD0.7 million incurred in the previous year. The entity strategically diversified its portfolio across various industries, with the majority
of the portfolio covered through import factor and credit insurance, effectively mitigating industry-specific risks. Furthermore, the successful
implementation of front-end software has significantly enhanced operational capabilities, including digital functionalities.
Throughout the year, India Factoring received numerous awards in India, recognizing excellence across various aspects of its business operations.
FIMBank Group Annual Report & Financial Statements 2023
7
Egypt Factors has observed a consistent invoice turnover in value terms, alongside a notable expansion in its factoring portfolio. Leveraging the
implementation of several government initiatives affecting trade, imports, and foreign currency in Egypt, the company capitalised on these
opportunities, resulting in a remarkable 50% increase in interest income. As a consequence, by the conclusion of 2023, Egypt Factors achieved a
substantial pre- and post-tax profit of USD1.9 million, marking a significant rise from the USD0.4 million reported in 2022.
The Group maintained a robust capital position throughout the year, with a Total Capital Ratio (“TCR”) of 18.3%, well exceeding the minimum
requirement of 16.1%. This surplus in capital provides the Group with an opportunity to pursue additional asset origination aligned with its risk
appetite, thereby generating incremental revenue streams. Anticipating further regulatory review, particularly the Supervisory Review and
Evaluation Process (“SREP”) by the MFSA, the Group expects a reduction in its Pillar 2 Requirement (“P2R”), which stood at 4.5% at year-end.
Moreover, the Group upheld a strong liquidity position, evidenced by an average Liquidity Coverage Ratio (“LCR”) of 288% and an average Net Stable
Funding Ratio (“NSFR”) of 141%. Both liquidity metrics comfortably surpassed regulatory minimums and the Group's internal risk appetite level,
underscoring its resilience and readiness to meet liquidity demands. Overall, these indicators affirm the Group's financial strength and adherence
to regulatory standards.
Statements of profit or loss
The Group registered a pre-tax profit of USD5.8 million for the financial period ending on 31 December 2023, compared to a pre-tax loss of USD24.7
million in the financial period ending on 31 December 2022. Post-tax, the Group reached break-even, with a marginal profit of USD7,674 for the
financial period ending on 31 December 2023. In the financial period ending on 31 December 2022, the Group suffered a loss of USD26.7 million.
Group earnings per share were negative at US cents 0.01 (2022: negative US cents 5.09). 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
2023
2022
Movement
USD
USD
USD
Net interest income
55,249,865
43,770,500
11,479,365
Net fee and commission expense
(739,577)
(2,004,678)
1,265,101
Dividend income
40,228
3,821,545
(3,781,317)
Fair Value Loss on Investment Property
(1,398,978)
-
(1,398,978)
Other operating income
1,665,027
163,542
1,501,485
Operating results from non-trading portfolio
54,816,565
45,750,909
9,065,656
Operating expenses
(43,840,601)
(38,262,423)
(5,578,178)
Income before net impairment and net trading results
10,975,964
7,488,486
3,487,478
Net trading results
(3,220,869)
(6,924,935)
3,704,066
Net impairment losses
(1,960,888)
(25,277,991)
23,317,103
Profit/(Loss) before taxation
5,794,207
(24,714,440)
30,508,647
Taxation
(5,786,533)
(1,957,610)
(3,828,923)
Profit/(Loss) for the year
7,674
(26,672,050)
26,679,724
The Group returned ‘Operating results from non-trading portfolio’ of USD54.8 million, exceeding last year’s results by USD9.1 million (20%). ‘Net
interest income’ rose by USD11.5 million (26%) year on year, to USD55.2 million, primarily due to higher interest rates allowing the Group to widen
its interest margins. ‘Net fees and commission expense’ at USD0.7 million improved from prior year by USD1.2 million.
During the year under review, the Group received a negligible amount of dividend from one of its investments, whereas in the previous year, the
Group had received USD3.8 million in dividends from its investment in unlisted sub-funds. However, 'Other operating income' includes a fair value
gain of USD0.8 million recognized on these investments in unlisted sub-funds, which are held at fair value through profit or loss, compared to a fair
value loss of USD0.3 million incurred in the previous year. Other elements of other operating income remained fairly stable.
The Group's investment property was subject to an external valuation, leading to a fair value loss of USD1.4 million. In December 2022, the same
property also underwent an external valuation, maintaining a stable value compared to the previous year.
FIMBank Group Annual Report & Financial Statements 2023
8
‘Operating expenses' for the year under review totalled USD43.8 million, marking a USD5.6 million (15%) increase from the previous financial year,
2022. In the prior year, the Group benefited from the depreciation of the Euro and the Pound Sterling against the US Dollar, as most expenses are
incurred in these currencies while the Group's functional currency is the US Dollar. During that year, this depreciation led to lower operating
expenses when converted back to USD. However, during 2023, both the Euro and the Pound Sterling appreciated against the US Dollar, reversing
the benefit observed in the previous year. Consequently, operating expenses incurred in these foreign currencies translated to higher expenses
when converted to the functional currency. Additionally, the Group faced higher costs in the transacted currencies due to inflationary pressures,
further contributing to the increase in operating expenses. Moreover, in 2023, the Bank recorded expenses related to the strategic transformation
project carried out by a highly reputable advisory firm as announced in previous publications.
'Net trading results' amounted to a loss of USD3.2 million, an improvement from the USD6.9 million loss in the prior year. The trading book, held at
the Group’s subsidiary LFC, was impacted by the default of an asset throughout 2023, which was party recovered from an insurance cover.
Additionally, the unpredictable operating environment resulting from the contagion effects of ongoing conflicts in Ukraine and Israel, as well as
monetary and fiscal policies from major markets, further affected net trading results.
Net impairment losses have normalized to USD2.0 million, a significant improvement from the USD25.2 million suffered in the previous year. The
Group reversed USD56.2 million of Stage 3 provisions, compared to USD13.4 million in 2022. Of this, USD60.3 million (2022: USD32.5 million) were
reversed due to write-offs or recoveries of non-performing exposures, while USD3.9 million (2022: USD19.5 million) was an increase in coverage for
legacy non-performing exposures and legal fees incurred during the recovery process.
Additionally, the Group recovered USD0.6 million in previously written-off debt, compared to USD1.6 million in 2022. The Group wrote off USD59.7
million of non-performing exposures in 2023, up from USD32.7 million in 2022. These write-offs were fully provided for in previous years, though
the Group still holds the option to enforce, sell, or transfer the credit to another entity.
These adjustments, along with other measures, led to a reduction of the NPL Ratio by approximately 6.5% within the review year to below 5%.
Management has made significant efforts over the past three years to decrease the NPL Ratio from 20% in 2020.
The Group also released USD0.7 million of Stage 1 and Stage 2 provisions for performing clients, in contrast to the USD1.9 million increase in
provisions seen in 2022. Additionally, the Group set aside USD0.4 million for liabilities and charges, compared to USD0.5 million in the previous year.
Notably, in 2022, the Group wrote off goodwill of USD5.2 million on Egypt Factors and India Factoring entirely. Consequently, no impairment
assessment of goodwill was necessary in 2023.
In 2023, provisions for tax for all Group entities amounted to USD5.8 million, compared to USD2.0 million in 2022. With the increased profitability
of the Group entities, some of the deferred taxation has been utilized. These entities have conducted assessments to ensure the recoverability of
the remaining recognized deferred tax assets before their finite expiry, where applicable.
Financial position
As of December 31, 2023, total consolidated assets amounted to USD1.58 billion, representing a USD25 million increase or 2% growth compared to
the end of 2022. However, the average total consolidated assets for the year were 12% lower than the previous year's average.
In comparison to the previous year, the Group closed the year with higher balances in treasury assets, including high-quality liquid assets (up by
USD96 million) and loans to banks (up by USD54 million). Conversely, there were lower balances in trading assets (down by USD70 million), factoring
assets (down by USD33 million), and trade finance (down by USD19 million).
Average loans to banks increased by USD27 million, reflecting the Group's strategic approach to managing risk. Despite the Group's ongoing efforts
to reduce exposure to higher-risk clients, the Financial Institutions portfolio has been cautiously managed in line with our prudent risk framework.
Nevertheless, there has been a concerted effort to attract business from jurisdictions and financial institutions that align with the Group’s risk and
compliance standards, while focusing on the portfolios’ risk adjusted returns.
The Group experienced a decline in average balances. Notably, factoring decreased by USD53 million, trading assets by USD29 million, and trade
and corporate finance by USD21 million. This reduction is primarily attributed to a cautious approach towards regulatory requirements, particularly
the Total Capital Ratio. Furthermore, the Group's ongoing strategic deployment of assets, marked by prudence in certain business activities,
jurisdictions, and customer segments, has further contributed to these declines. Additionally, market conditions affected by inflationary pressures
and geopolitical conflicts, such as those in Ukraine and the Middle East, have impacted demand and trade flows.
The average balances for treasury assets decreased by USD100 million. These assets comprise high-quality liquid assets and are primarily managed
to meet the Group's liquidity needs and regulatory liquidity ratios.
FIMBank Group Annual Report & Financial Statements 2023
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The Group conducted an assessment on deferred tax assets and investments across its subsidiaries, affirming the adequacy of their carrying
amounts. During these assessments, Management considered various factors significantly influencing the global economy and the specific activities
of these assets.
An external valuation of the head office premises in St. Julians, which is partially recognized under 'Property, plant, and equipment' and partially
under 'Investment property,' indicated that the fair value of the 'Property, plant, and equipment' increased by USD0.8 million, while the fair value
of the 'Investment property' decreased by USD1.4 million.
As of December 31, 2023, the Group's consolidated liabilities totalled USD1.40 billion, reflecting an increase of USD16 million from the previous
year. However, average balances for 2023 were lower than the previous year by USD165 million. Particularly, average balances for bank wholesale
funding decreased by USD133 million.
Total equity increased by USD8.8 million to USD179.3 million, attributed to a USD1.2 million net fair value gain on 'Property, plant, and equipment'
and an USD8.1 million fair value gain on 'Financial investments at fair value through other comprehensive income’. As of 31 December 2023, the
Group’s CET1 and TCR ratios stood at 18.3% (compared to 17.8% in 2022).
Total consolidated commitments amounted to USD147.8 million (compared to USD100.0 million in 2022), primarily comprising confirmed letters of
credit, documentary credits, commitments to purchase forfaiting assets, and undrawn credit facilities. Total consolidated contingent liabilities,
primarily composed of outstanding guarantee obligations, reached USD31.3 million (compared to USD14.7 million in 2022).
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 5 of this Annual Report and the 2023 Pillar 3 Disclosures
Report published on the Bank’s website.
Outlook for 2024
Global economic growth is forecasted to remain modest, initially slowing in the first half of the year before gaining momentum in the latter half.
The majority of economies are expected to grapple with the enduring effects of tightened monetary policies, compounded by weak trade dynamics
and subdued consumer and investor confidence. Despite regional variations, a gradual easing of inflation towards central bank targets is anticipated
across most economies. This deceleration in inflation is poised to bolster real incomes for households, thereby mitigating the extent of economic
downturns. Consequently, lower inflation rates should pave the way for central banks to contemplate reducing interest rates at some points
throughout the year.
The ongoing conflict in Ukraine shows no signs of diminishing in the near future. Tensions in the Middle East have the potential to escalate across
the broader region, a critical hub for oil and gas production. Furthermore, persistent attacks in the Red Sea, a key artery for global trade, are
compounding the challenges. These developments are fuelling fresh supply shocks to the global recovery, resulting in spikes in food, energy, and
transportation costs.
Taking these factors into account, the Group will proactively seek out business opportunities with a focus on achieving risk-adjusted returns, all
while maintaining alignment with its risk appetite and regulatory capital requirements. Following the cleanup efforts, the Group's balance sheet has
become more resilient, thanks to diminished legacy exposures and fortified, sustainable revenue streams.
Anticipated portfolio growth will likely be modest within our customer-centric approach. Our strategic priorities persist in emphasizing business
lines and geographical regions that present superior returns and lower risks, thereby ensuring consistent value generation for the Group. As we
progressively eliminate complex structures and streamline business lines, our presence in Malta continues to evolve and mature.
FIMBank Group Annual Report & Financial Statements 2023
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The Group remains focused on improving its strategy to pursue our long-term objective of expanding and future-proofing our shareholders’ value.
We are progressing in this initiative with a highly reputable advisory firm, employing a holistic approach covering business lines, markets, products,
and building competitive advantage. Certain recommendations from this initiative are set to be implemented as soon as 2024. Furthermore,
significant importance is placed on the Group’s cost structure, IT and data architecture design and integration, as well as the resources and
capabilities of the Group.
Another MFSA Supervisory Review and Evaluation Process (SREP), concluded in the early months of 2024, resulted in a 0.8% reduction of the Group’s
Pillar 2 requirement (P2R), a change welcomed by the Group. The MFSA acknowledged the Group’s improvements in profitability and its broadly
stable funding and liquidity profile. The Authority noted the constant efforts by Management to decrease the non-performing loan portfolio below
regulatory thresholds, and the Board has satisfactorily addressed the qualitative requirements and recommendations stemming from the SREP
performed in 2021.
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 (2022: 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.
Approvals at the annual general meeting of shareholders
The Bank convened its Annual General Meeting on 4 May 2023 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 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
2023 are as follows:
No of shares
% holding
United Gulf Holding Company B.S.C
420,019,110
80.40%
Burgan Bank K.P.S.C.
44,394,499
8.50%
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 effect 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
FIMBank Group Annual Report & Financial Statements 2023
11
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 2023, 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
Merger
On 25 January 2024, the Bank issued a Company Announcement, announcing that as part of a streamlining initiative and corporate restructuring
exercise, the Bank’s Board of Directors has resolved to approve a merger by acquisition between the Bank, as the acquiring company, and FIM
Business Solutions as the company being acquired (the “Merger”).
Please refer to Note 47 to the Financial Statements for more information.
Dividends Received
In March 2024, the Bank received a cash dividend of USD2.0 million from its wholly owned subsidiary London Forfaiting Company Limited.
There were no other material events or transactions which took place after the financial reporting date which would require disclosure in or
adjustment to this Annual Report and Financial Statements.
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.
Directors
The Directors who served during the financial year (inclusive of any changes to the date of this report) were:
John C. Grech (Chairman) CGC, BCC, BRIC
Masaud M.J. Hayat (Vice Chairman) NRC
Abdel Karim A.S. Kabariti CGC, NRC Retired on 4 May 2023
Claire Imam Thompson CGC, BAC, BRC Resigned on 10 November 2023
Edmond Brincat BAC, NRC, BESG
Erich Schumacher BRC
Hussain Abdul Aziz Lalani BAC, BRC, BRIC, BESG
Majed Essa Ahmed Al-Ajeel CGC, NRC Retired on 4 May 2023
Mohamed Fekih Ahmed BCC Retired on 4 May 2023
Mohammed Louhab BCC, BESG
Rabih Soukarieh BCC
Rogers David LeBaron CGC, NRC Retired on 4 May 2023
Sunny Bhatia CGC, NRC
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)
• Nomination and Remuneration Committee (“NRC”)
• Board Environmental, Social and Governance Committee (“BESG”)
FIMBank Group Annual Report & Financial Statements 2023
12
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 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 2023, Ernst & Young Limited Malta were appointed as statutory auditors of the Group and Bank at the Annual General Meeting which was
held on 4 May 2023. Following such appointment, EY Malta and the Group/Bank mutually agreed to terminate their existing relationship and EY
Malta resigned from the engagement as statutory auditors of the Group and Bank. Accordingly, in January 2024, the Board of Directors of FIMBank
appointed PricewaterhouseCoopers (“PwC”) as the Group’s statutory auditors for the financial year ended 31 December 2023. The appointment of
PwC as the Group’s statutory auditors for the financial year ending 31 December 2024 will be proposed at the forthcoming Annual General Meeting.
Subject to the approval of the Shareholders, PwC will perform the statutory audit of the Group and Bank for the financial year ending 31 December
2024.
Approved by the Board of Directors and signed on its behalf by John C. Grech (Chairman) and Masaud M.J. Hayat (Vice Chairman) on 24 April
2024 as per Director’s Declaration on ESEF Annual Financial Report submitted in conjunction with the Annual Report and Financial Statements
2023.
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 2023
13
Statement of compliance with the principles of good
corporate governance
For the year ended 31 December 2023
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. 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 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 2023
14
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 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 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 finance Director, the Chairman maintains sufficient contact
with major 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 the 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 (the “Articles”) 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 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, provided that such nomination is seconded by a Member or Members
who in aggregate hold at least twenty thousand 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:
Year when first appointed
John C. Grech (Chairman)
2004
Rogers David LeBaron
2006
Retired on 4 May 2023
Majed Essa Ahmed Al-Ajeel
2013
Retired on 4 May 2023
Masaud M.J. Hayat (Vice Chairman)
2013
Mohamed Fekih Ahmed
2013
Retired on 4 May 2023
Rabih Soukarieh
2013
Edmond Brincat (Independent Director)
2017
Hussain Abdul Aziz Lalani
2017
Abdel Karim A.S. Kabariti
2020
Retired on 4 May 2023
Claire Imam Thompson (Independent Director)
2020
Resigned on 10 November 2023
Erich Schumacher
2022
Sunny Bhatia *
2023
Appointed on 4 May 2023
Mohammed Louhab **
2023
Appointed on 4 May 2023
‘ * ‘ Sunny Bhatia was appointed by the Shareholders on 4 May 2023 and regulatory approval was obtained on 23 August 2023.
‘ ** ‘ Mohammed Louhab was appointed by the Shareholders on 4 May 2023 and regulatory approval was obtained on 30 November 2023.
FIMBank Group Annual Report & Financial Statements 2023
15
Other than for their involvement in Board Committees as described below, all Directors hold office in a non-executive capacity with the exception
of Mohammed Louhab who is an Executive Director and the GCEO of the Bank.
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 March 2024. 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 2023, the Board of Directors consisted of:
Number of directorships held
(including FIMBank p.l.c. and its subsidiaries)
John C. Grech (Chairman)
4
Masaud M. J. Hayat (Vice Chairman)
1
Edmond Brincat
8
Hussain Abdul Aziz Lalani
1
Rabih Soukarieh
1
Erich Schumacher
1
Sunny Bhatia
1
Mohammed Louhab
2
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 statutory 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 statutory 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 held six meetings in 2023. All Members of the Board were present for all six meetings except for Abdel Karim A.S. Kabariti, who was
excused in May, Sunny Bhatia was excused in June and Edmond Brincat was excused in July. Sunny Bhatia attended three meetings, one meeting as
an invitee and two meetings as an approved Member of the Board. Mohammed Louhab attended five meetings, four meetings as an invitee and
one meeting as an approved Member of the Board. 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.
FIMBank Group Annual Report & Financial Statements 2023
16
The Board also might 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, Nomination and Remuneration Committee, Corporate Governance Committee, Board Credit Committee and
Board Risk 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.
Training sessions have been held in 2023 in order for Directors to have the necessary knowledge on their duties and responsibilities.
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
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. The Board undertakes an annual evaluation of its own performance and that of its Committees. The evaluation forms are then
evaluated by the Nomination and Remuneration Committee (“NRC”) as the Committee entrusted to perform this function. The NRC then reports
directly to the Board Chairman who is 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
at the Annual General Meeting. This exercise began in 2013 and has been repeated annually ever since.
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 April 2023 did not indicate
that any changes were required. The only change in the membership composition was due to a direct replacement of a Director who resigned.
Details regarding the changes to Committee composition have been disclosed under Principle 8: Changes to committee memberships during 2023.
The last evaluations from Directors were requested in the last quarter of 2023 and were presented to the NRC in March 2024.
FIMBank Group Annual Report & Financial Statements 2023
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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
• Nomination and Remuneration Committee (further information can be found in the Remuneration Report on page 24)
• 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 2023 are the following:
John C. Grech (Chairman)
Hussain Abdul Aziz Lalani (Vice Chairman)
Adrian A. Gostuski (Non-Voting Member)
The Board Review and Implementation Committee met on seven occasions during 2023.
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 all meetings. In addition, the composition of the
Members of the Board Audit Committee includes one individual who is also a Member of the Board Risk Committee.
The Members of the Board Audit Committee as at 31 December 2023 are the following:
Edmond Brincat (Chairman – Independent Director)
Hussain Abdul Aziz Lalani (Vice Chairman)
In line with Capital Markets Rule 5.117.4, 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.
FIMBank Group Annual Report & Financial Statements 2023
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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. In February 2018, Edmond Brincat joined
SmartCity (Malta), a subsidiary of Dubai Holding LLC, and currently acts as the company’s Chief Executive Officer. 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.
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. 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.
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 thirteen meetings during 2023 and all Members were present for all thirteen meetings. The Group Head of Internal
Audit was also invited to attend and attended all thirteen 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 2023 Statutory External Audit (February 2023), 2022 Annual Report
and Management Letter (March 2023), Parent Statutory Reporting Audit Update (May 2023), Interim Report for the period ended 30 June 2023
(July 2023 and two meetings in August 2023) and Statutory Audit for Financial Year ending 31 December 2023 (December 2023).
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.
The Board Risk Committee Members as at 31 December 2023 are the following:
Hussain Abdul Aziz Lalani (Chairman)
Erich Schumacher (Member)
During 2023, the Board Risk Committee met on nine occasions.
Assets liabilities committee
The Assets Liabilities Committee (“ALCO”) is a decision-making body responsible for allocating the Group’s assets and liabilities to meet the Group’s
risk and profitability objectives.
The ALCO is composed of representatives of Senior Management, vested with the power to make decisions. As at 31st December 2023, the voting
members of the ALCO were the following:
Mohammed Louhab (Chairman)
Zbigniew Makula (Vice-Chairman)
Adrian A. Gostuski (Member)
Simon Lay (Member)
Ronald Haverkorn (Member)
Juraj Beno (Member)
Modesto Luengo (Member)
Jason Zammit (Head of Corporate Finance Malta, Marketing & Administration), Chris Trapani (Head of Cash Management & Central Customer
Services), Tiziri Hamidouche (Deputy Head of Treasury), Corinne Lanfranco (Head of Financial Institutions & Deposits), Simon Vickery (Head of Non-
Credit Risk Management) and Clinton Bonnici (ALCO Secretary) are non-voting, permanent invitees of the ALCO.
During 2023, the Assets Liabilities Committee met on six occasions.
FIMBank Group Annual Report & Financial Statements 2023
19
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 Procedures; and
• review and consider for approval country limit applications, within the guidelines specified in the Group’s Credit Policy Procedures.
The Board Credit Committee Members as at 31 December 2023 are the following:
John C. Grech (Chairman)
Rabih Soukarieh (Vice Chairman)
Mohammed Louhab (Member)
Adrian A. Gostuski (former GCEO) and Modesto Luengo (GCRO) are non-voting, permanent invitees of the BCC.
During 2023, the Board Credit Committee met on three occasions.
Nomination and remuneration committee
The Nomination and Remuneration Committee (“NRC”) is currently composed of three members, one of whom is an independent director. The NRC
is governed by the NRC’s Charter as may be amended by the Board of Directors (“Board”) in line with the relevant laws and regulations. The Charter
establishes the authority and responsibilities conferred by the Board to the NRC in line with Appendix 5.1 (8) (A) & (B) of the Code of Principles of
Good Corporate Governance. The responsibilities of the NRC 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 Remuneration Policy Supplement 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 Supplement;
• 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 Remuneration Policy Supplement 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 NRC 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.
FIMBank Group Annual Report & Financial Statements 2023
20
The Nomination and Remuneration Committee Members as at 31 December 2023 are the following:
Masaud M.J. Hayat (Chairman)
Edmond Brincat (Vice Chairman)
Sunny Bhatia
John C. Grech (FIMBank Chairman) and Mohammed Louhab (GCEO) and Adrian Gostuski, former GCEO are non-voting, permanent invitees of the
NRC.
During 2023, the Nomination and Remuneration Committee met on 5 occasions.
Attendance for the meetings was regular except for two instances, one involving an exiting Director in May at the time when the AGM was
reappointing a new Board and the other instance was at the June meeting when a newly appointed Director was still pending regulatory approval.
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 industry’s best practice.
The Corporate Governance Committee Members as at 31 December 2023 are the following:
John C. Grech (Chairman)
Sunny Bhatia (Member)
During 2023, the Corporate Governance Committee met on five occasions.
Board Environmental, Social and Governance Committee
The Board Environmental, Social and Governance Committee ("BESG") is responsible for assisting the Board in setting the Bank’s Environmental
Social and Governance (“ESG”) policies, strategy and following-up on its execution and periodic review to ensure its effectiveness as well as to
enhance the effectiveness of the Board’s supervision over any matters relating to ESGC. 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 2023 are the following:
Edmond Brincat (Chairman)
Hussain Abdul Aziz Lalani (Member)
Mohammed Louhab (Member)
The Board Environmental, Social and Governance Committee met on one occasion during 2023.
Changes to committee membership during 2023
During 2023, Rogers David LeBaron retired resulting in him no longer being a member of the Nomination & Remuneration Committee and the
Corporate Governance Committee.
Claire Imam Thompson resigned resulting in her no longer being a member of the Board Audit Committee, the Corporate Governance Committee,
and the Board Risk Committee.
Majed Essa Al-Ajeel retired resulting in him no longer being a member of the Nomination & Remuneration Committee and the Corporate Governance
Committee.
Abdel Karim Kabariti retired resulting in him no longer being a member of the Nomination & Remuneration Committee and the Corporate
Governance Committee.
Mohamed Fekih Ahmed resigned resulting in him no longer being a member of the Board Credit Committee.
Sunny Bhatia was thereafter appointed member of the Nomination & Remuneration Committee and the Corporate Governance Committee.
Mohammed Louhab was thereafter appointed member of the Board Credit Committee.
FIMBank Group Annual Report & Financial Statements 2023
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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 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 2023 the Bank issued sixteen 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 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 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 2023
22
The number of shares held in the Bank by Directors directly in their name as at 31 December 2023 is as follows:
John C. Grech (Chairman) * 1,760,000
Edmond Brincat Nil
Erich Schumacher * Nil
Hussain Abdul Aziz Lalani * Nil
Masaud M.J. Hayat (Vice Chairman) * Nil
Mohammed Louhab * Nil
Rabih Soukarieh * Nil
Sunny Bhatia * 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 the Notes to the Financial Statements.
Principle 12: Corporate social responsibility
We recognise that our social, environmental, and ethical conduct significantly impacts our reputation and the communities where we operate.
Therefore, we take our Corporate Social Responsibilities (“CSR”) seriously and consider them fundamental to FIMBank's corporate culture.
We are committed to advancing our policies and systems across the Group, ensuring that we comprehensively address and monitor all CSR aspects
relevant to our business. The Bank's CSR strategy, centred around our core values, reflects our commitment to our clients, shareholders, employees,
and the Maltese community, which has been home to FIMBank's head office since its inception in 1994.
Our CSR program aims to maximize and protect shareholder value while fostering socially responsible and ethically robust relationships with clients
and partners. It also seeks to promote policies that maintain a work environment where our employees can excel professionally and achieve a
healthy work-life balance. Additionally, the CSR program focuses on serving the communities in which we operate, especially in their social and
environmental well-being.
Our commitment to CSR ensures that we operate under the highest standards of good governance and ethics. We strive to provide a constantly
evolving range of services that meet the changing needs and expectations of our clients and business partners. Our CSR activities are designed to
attract and retain employees who are not only technically skilled but also uphold strong ethical values. We expect our CSR initiatives to provide
meaningful support to the local community, enhancing the social and environmental impacts of our business practices.
We achieve our CSR objectives through sound corporate governance, compliance practices, and increased transparency in reporting these activities.
Maintaining ethical policies and providing training ensures that all employees uphold the highest standards of integrity and trust. This is supported
by programs that manage the long-term development of our employees, fostering an environment for growth and excellence. Our CSR efforts focus
on corporate philanthropy that enhances quality of life. The success of our CSR also depends on proper risk management and implementing data
security and privacy programs to safeguard all stakeholders.
Further details about the CSR initiatives undertaken by the Group in 2023 are provided in the GCEO’s Message in the Annual Report.
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 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.
FIMBank Group Annual Report & Financial Statements 2023
23
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 NRC, during its August meeting, discussed Directors’
succession planning on the basis of an internet-based global market research which among others took into consideration factors like gender, and
experience in financial services, IT and ESG including experience at international level. During the August meeting of 2023, the NRC discussed the
annual employment market assessment related to Board succession planning as presented.
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 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 Nomination and Remuneration Committee 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 NRC 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 NRC
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 John C. Grech (Chairman) and Masaud M.J. Hayat (Vice Chairman) on 24 April
2024 as per Director’s Declaration on ESEF Annual Financial Report submitted in conjunction with the Annual Report and Financial Statements
2023.
FIMBank Group Annual Report & Financial Statements 2023
24
Remuneration report
For the year ended 31 December 2023
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 principles)
Terms of reference and membership
The Board Nomination and Remuneration Committee (“NRC”) 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 NRC 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 1st January up to the Annual General Meeting (“AGM”) held on 4th May 2023 the NRC was composed of five members, Masaud M.J. Hayat
(Chairperson), Edmond Brincat (Vice-Chairperson and Independent Member), and Directors Abdel Karim A.S. Kabariti, Majed Essa Ahmed Al-Ajeel,
and Rogers David LeBaron who did not re-submit their candidacy to the May 2023 AGM. As at 31 December 2023, the NRC was composed of three
members, Masaud M.J. Hayat (Chairperson), Edmond Brincat (Vice-Chairperson and Independent Member) and Sunny Bhatia, a newly appointed
Director by the shareholders at the May 2023 AGM. John C. Grech and Mohammed Louhab, in their capacity as Chairperson of the Bank and Group
Chief Executive Officer (“GCEO”) respectively, attended the NRC’s meetings as permanent invitees. Adrian A. Gostuski, who held the position of
GCEO until 30 November 2023 and was thereafter appointed as advisor to the new GCEO, also attended the NRC meetings held in 2023. The Group
Chief Human Resources Officer (“GCHRO”) acted as Board Committee Secretary.
Meetings
The Committee met five times during the period under review, which meetings were attended as follows:
Members Attended
Masaud M.J. Hayat (Chairperson) 5 out of 5
Edmond Brincat (Member) (Vice-Chairperson) 5 out of 5
Sunny Bhatia 2 out of 3 (excused in June)
Abdel Karim A.S. Kabariti 1 out of 2 (excused in May)
Majed Essa Ahmed Al-Ajeel 2 out of 2
Rogers David LeBaron 2 out of 2
FIMBank Group Annual Report & Financial Statements 2023
25
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 and Board Committees self-assessment;
e. Board Committees: new ESG Committee and memberships;
f. NRC Charter: annual review and checklist;
g. Report and recommendations by Internal Audit on the review of the Group Remuneration Policy;
h. Group Remuneration Policy;
i. Executive Management: recruitment, appointments, performance, promotions, succession and remuneration;
j. Group salary review, bonus allocation and out of cycle increases/payments;
k. Succession planning for all entities;
l. Control functions: independence, recruitment, succession and performance;
m. Performance review of GCEO and performance bonus award;
n. HR Policies;
o. Remuneration Policy Statement, Statement of the NRC, Directors’ Remuneration Report for Annual Report and Pillar 3 Disclosures;
p. Egypt Factors CEO’s new definite contract;
q. Suitability and Succession Policy and Skills Matrix Template;
r. Suitability assessment and succession of the Board, the GCEO and the Key Function Holders;
s. Sourcing of Independent non-executive Directors;
t. LFC Directors’ Remuneration;
u. Compensation and talent retention challenges; and
v. Review of the Recoveries function.
Remuneration statement
The NRC has the role of making recommendations to the Board of Directors on remuneration. Decisions taken by the NRC are presented by the NRC
Chairperson to the Board for ratification or otherwise. The guiding principle, as outlined in the Remuneration Policy and the Remuneration Policy
Supplement, is that the remuneration for the Directors shall be competitive to ensure that the Bank attracts and retains outstanding individuals of
integrity, calibre, credibility and who have the necessary skills and experience to bring an independent judgement to bear on the issues of strategy,
performance and resources for the success of the Bank.
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.
FIMBank Group Annual Report & Financial Statements 2023
26
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 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, only the respective Chief Executive Officers (“CEOs”) are considered to be Identified
Staff, as the only function reporting directly to the GCEO.
The GCEO is appointed on a definite term contract which may vary from a one-year definite term contract to a three-year definite term contract.
The contract may be renewed for further definite term periods. The Deputy CEO is appointed pursuant to an indefinite term contract. The notice
periods applicable for both the GCEO and the Deputy CEO are in accordance with the prevailing legislation by which the respective employment
contract is governed in terms of jurisdiction. Members of the Executive Management of the Bank hold both definite and indefinite contracts with
varying notice periods, all of which are in line with locally applicable legislation. Directors are appointed pursuant to appointment letters. Their
appointment is for a period of one year renewed or otherwise at the subsequent Annual General Meeting of the Bank.
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.
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 that 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 Annual General Meeting 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, develop and retain a high-performing workforce while remaining aligned to FIMBank’s long-term
strategy, risk appetite, sustainable performance, good corporate governance, regulatory compliance, corporate values 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 NRC 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 2024.
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 tables below 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 2023
27
Fixed remuneration
Element and purpose of remuneration
Operation
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 27introduced statutory payments or adjustments to
existing ones.
The base salary does not vary
according to performance of the
individual and the Bank, according
to the FIMBank pay structure
approved annually by the NRC.
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.
N/A
Variable remuneration
Element and purpose of remuneration
Operation
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 detailed in the Bank’s Performance Management Policy
and Procedure.
A performance bonus relates to the Executive’s performance as defined in the multi-year
assessment where applicable and the cash component is paid by April.
The individual rating is based on the Executive’s
overall performance which is centred on
performance targets and core behaviours
(leadership, people management, personal
effectiveness, creativity, innovation, holistic
approach, teamwork, communication and company
values).
FIMBank Group Annual Report & Financial Statements 2023
28
Variable remuneration (continued)
Element and purpose of remuneration
Operation
Performance measures
Employee Share Award Scheme
To create alignment between the interests of
Executives and shareholders through the delivery of
rewards in the Company Shares
In addition to a performance bonus, subject to performance appraisal and a multi-year assessment
where applicable, Executives may also be entitled to share awards as stipulated in the ESAS 2019-
2023.
Share awards are subject to malus and clawback provisions.
N/A
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.
N/A
Retention Bonus
To ensure business continuity and assist executives
in carrying out their duties efficiently.
Executives may 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.
Retention bonuses may be paid only in exceptional circumstances such as in the case of a
restructuring, wind-down, after a change in control or to ensure the completion of major projects.
Retention bonuses 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 awarded amount is necessary and
proportionate to retain the targeted
Executive.
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, such as if the Bank terminates the
employment contract due to the failure of the institution or following a material reduction of its
activities or if the Bank and an Executive mutually agree on a settlement in case of a dispute.
Unless stipulated by local regulation, the maximum severance payment awarded may be of a
maximum of three (3) months’ base salary.
N/A
FIMBank Group Annual Report & Financial Statements 2023
29
Variable remuneration (continued)
Element and purpose of remuneration
Operation
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.
The sign-on bonus is exceptional and can 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.
N/A
Buy-Out Compensation of Previous Employment
Contract
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.
N/A
NRC 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 NRC.
FIMBank Group Annual Report & Financial Statements 2023
30
Variable remuneration (continued)
The variable remuneration awarded to Executives is also subject to the below provisions emanating from the Remuneration Policy Supplement:
Clawback and Malus
Any variable remuneration is subject to clawback and malus. 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 (4) 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.
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 that a) such an increase is approved by the shareholders and b) the regulator is duly informed of the
recommendation and the underlying reasons for it.
Other requirements
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 applicable to the Bank, namely:
1. the principle that a minimum of 50% of any variable remuneration shall consist of shares; and
2. 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 2023
31
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 4 May 2023, the Shareholders approved the maximum aggregate emoluments of the
Non-Executive Directors for the financial year ended 31 December 2023 at USD450,000 (2022: 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
2023 amounted to USD180,276, which is included as part of the total payments received by Non-Executive Directors disclosed below.
For 2023, the total payments received by the Non-Executive Directors from the Bank were:
• fixed remuneration USD388,106
• variable remuneration Nil
• executive share options Nil
• fringe benefits USD391
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 4 May 2023.
For 2023, the total payments received by the GCEO, Deputy CEO and Executive Management from the Bank were:
• fixed remuneration USD2,243,555
• variable remuneration * USD461,788
• executive share options granted Nil
• fringe benefits USD594,573
' * ’ Variable remuneration represents the amounts attributable to the GCEO, Deputy CEO and Executive Management in respect of performance
year 2022, given that the variable remuneration in respect of the financial year ended 31 December 2023 will only be formally determined and
approved by the NRC subsequent to the reporting date.
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 2023 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, except for Mohammed Louhab who, in the period during which he was a Non-Executive Director of the
Bank, was awarded USD199,228 by United Gulf Holdings (“UGH”) for the services he rendered to the FIMBank Group. In this respect, 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 2023
32
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 Remuneration Policy Supplement (“Policy”) as approved by the
Annual General Meeting held on 14 June 2022 and published on the Bank’s website (refer to policy in full on
https://www.fimbank.com/en/remuneration-policy-supplement). The result of the vote at the Annual General Meeting when the Policy was last
approved was 428,017,041 votes in favour, 53,658,126 “as he prefers” votes, 2,864,522 votes against, votes 6,736,120 abstentions and 17,609
invalid votes implemented without making any derogations and/or deviations from the procedure for the implementation of the Remuneration
Policy as defined in Chapter 12 of the Capital Markets Rules.
The Policy is effective for three years since the date of approval and will therefore be subject to another approval in the 2025 Annual General
Meeting. Nevertheless, the Policy is reviewed annually to reflect any new regulatory requirements or changes in Policy. Any material amendments
are approved by the NRC prior to being submitted to the General Meeting for its binding vote. No changes to the Policy were made in 2023.
However, it is not excluded that an updated version of the Policy shall be proposed for approval in the upcoming Annual General Meeting should
the NRC approve any amendments in the interim.
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 2023 (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 three 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 tables below. Non-Executive Directors only receive fixed fees for their participation
at Board and Committee level. 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 42 and 43 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 2023. In addition, Non-Executive Directors are not entitled to profit-sharing
arrangements, share options, shares or pension benefits.
FIMBank Group Annual Report & Financial Statements 2023
33
Directors’ remuneration
Difference
Difference
Difference
Name of director
2023
2022
2021
2023 vs 2022
2022 vs 2021
2021 vs 2020
Notes
USD
USD
USD
%
%
%
John C. Grech
* 100,891
100,400
101,032
0.5
(0.6)
2.8
The change in fee structure reflects a marginal increase following the appointment as
Chairperson of the Corporate Governance Committee as from May 2023.
Masaud M.J. Hayat
19,750
19,750
17,000
0.0
16.2
(17.1)
No change in fee structure in 2023.
Abdel Karim A.S. Kabariti
9,000
13,500
17,667
100
(23.6)
92.8
No change in fee structure. The fees for 2023 represent fees payable in respect of services
rendered until April 2023. Excused for Board and Committees commitments up to AGM in May
when he ceased to hold the position of director. In 2022, Mr. Kabariti attended 50% of Board
and Committee meetings. Therefore, the annualisation of fees paid to Mr. Kabariti in 2023
(considering the cessation of directorship on 4 May 2023) would result in fees which are double
the fees received in respect of services rendered in 2022 (taking into consideration the
absenteeism at Board and Committee meetings).
Claire Imam Thompson
38,333
46,000
38,333
0.0
0.0
NA
No change in fee structure. Fees represent services rendered up to October 2023, in view of
the cessation of directorship on 10 November 2023 when Ms. Imam Thompson resigned. The
annualisation of fees paid to Ms. Imam Thompson in 2023 would result in fees which are in
line with those paid in respect of 2022.
Edmond Brincat
51,356
46,000
47,333
11.6
(2.8)
1.6
Change in fee structure following change in committees’ composition, inclusive of the creation
of the Board ESG (BESG) Committee in August and Mr. Brincat’s appointment as its
Chairperson, resulting in an increase of 11.6% in remuneration compared to 2022.
Erich Schumacher
19,000
11,083
-
0.0
NA
NA
In 2022, Mr. Schumacher was only remunerated for part of the year, given that Mr.
Schumacher was appointed as Director in June 2022. The annualisation of fees paid to Mr.
Schumacher in 2022 would result in fees which are in line with those paid in respect of 2023.
Hussain Abdul Aziz Lalani
39,417
36,750
36,750
7.3
0.0
5.4
Change in fee structure following change in committees' composition in August. Mr. Lalani
was appointed as a member of the BESG Committee, resulting in an increase of 7.3% in
remuneration compared to 2022.
Majed Essa Ahmed Al-Ajeel
13,750
27,750
25,750
0.0
7.8
21.9
The fees for 2023 represent fees payable in respect of services rendered until April 2023,
where Mr. Al-Ajeel attended all Board and Committee meetings until 4 May 2023, which is
the date when Mr. Al-Ajeel ceased to hold the position of Director. These fees reflect Mr Al-
Ajeel’s contribution to the Board and the Committees for the period. For the purposes of the
annual percentage change between 2023 and 2022, the annualisation of fees in 2023
considers the pro-rated services for Board and Committee meetings separately, where c. 50%
of Board and Committee meetings where Mr. Al-Ajeel participates had been held by 4 May
2023. The annualisation of fees paid in 2023 would result in fees which are in line with those
paid in respect of 2022.
‘ * ’ 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 2023 comprise USD100,500 in fees and USD391
in fringe benefits.
FIMBank Group Annual Report & Financial Statements 2023
34
Directors’ remuneration (continued)
Difference
Difference
Difference
Name of director
2023
2022
2021
2023 vs 2022
2022 vs 2021
2021 vs 2020
Notes
USD
USD
USD
%
%
%
Mohamed Fekih Ahmed
10,833
27,000
27,000
0.0
0.0
(4.7)
The fees for 2023 represent fees payable in respect of services rendered until April 2023, where
the Director attended all Board and Committee meetings until 4 May 2023, which is the date
when Mr. Fekih ceased to hold the position of Director. These fees reflect the Mr. Fekih’s
contribution to the Board and the Committees for the period. For the purposes of the annual
percentage change between 2023 and 2022, the annualisation of fees in 2023 considers the
pro-rated services for Board and Committee meetings separately, where 50% of Board
meetings and 33% of Committee meetings where Mr. Fekih participates had been held by 4
May 2023. The annualisation of fees paid in 2023 would result in fees which are in line with
those paid in respect of 2022.
Mohammed Louhab
17,750
NA
NA
NA
NA
NA
Fees represent services rendered by Mr. Louhab from his appointment on 4 May 2023 to 30
November 2023, on which date the Director was appointed as GCEO and, in this respect, Mr.
Louhab’s appointment changed from a Non-executive Director to Executive Director. As from
September, following the creation of the BESG Committee in August, Mr. Louhab started
receiving an additional fee accordingly. For a detailed analysis of Mr. Louhab’s remuneration
as an Executive Director, please refer to the ‘Executive Directors and Deputy CEO’ section.
Rabih Soukarieh
27,000
24,750
23,000
8.0
8.7
(11.87)
No change in fee structure. Mr. Soukarieh attended all meetings in 2023. In this respect, the
increase in fees between 2022 and 2023 is due to the number of sittings attended in 2023.
Rogers David LeBaron
30,167
63,000
63,000
0.0
0.0
(0.1)
The fees for 2023 represent fees payable in respect of services rendered until April 2023, where
Mr. LeBaron attended all Board and Committee meetings until 4 May 2023, which is the date
when Mr. LeBaron ceased to hold the position of Director. These fees reflect Mr. LeBaron’s
contribution to the Board and the Committees for the period. For the purposes of the annual
percentage change between 2023 and 2022, the annualisation of fees in 2023 considers the
pro-rated services for Board and Committee meetings separately, where c. 48% of Board and
Committee meetings where Mr. LeBaron participates had been held by 4 May 2023. The
annualisation of fees paid in 2023 would result in fees which are in line with those paid in
respect of 2022.
Sunny Bhatia
11,250
NA
NA
NA
NA
NA
Fees represent services rendered by the Director from 23 August 2023 when regulatory
approval was granted.
Note: The remuneration attributable to Non-Executive Directors in respect of the financial year ended 31 December 2023 included in the table above represents the fixed remuneration attributable to
performance year 2023.
In addition to the above fees, Directors John C Grech, Eric Schumacher, Hussain Lalani and Mohammed Louhab were also awarded remuneration for their services as Directors on the LFC Board of Directors. The fees
awarded are: John C Grech (Chairperson) USD15,000, Erich Schumacher USD10,000, Hussain Lalani USD10,000 and Mohammed Louhab USD10,000.
FIMBank Group Annual Report & Financial Statements 2023
35
Directors’ remuneration (continued)
The positions held by the Bank’s Directors during the financial year ended 31 December 2023 are presented hereunder:
Name of director
Position
John C. Grech
Non-Executive Director, Chairperson FIMBank BoD, Chairperson LFC BoD, Chairperson BRIC, Chairperson BCC, Chairperson CGC, Permanent Invitee NRC
Masaud M.J. Hayat
Non-Executive Director, Vice Chairperson BoD, Chairperson NRC
Abdel Karim A.S. Kabariti
Non-Executive Director, Member BoD, Member BCGC, Member NRC – retired May 2023
Claire Imam Thompson
Independent Non-Executive Director, Member BoD (independent member), Member BAC, Member BRC, Member BCGC - resigned November 2023
Edmond Brincat
Independent Non-Executive Director, Member BoD (independent member), Chairperson BAC, Chairperson BESGC, Vice Chairperson NRC
Erich Schumacher
Non-Executive Director, Member BoD, Member BRC, Member LFC BoD
Hussain Abdul Aziz Lalani
Non-Executive Director, Member BoD, Chairperson BRC, Vice Chairperson BAC, Vice Chairperson BRIC, Member LFC BoD
Majed Essa Ahmed Al-Ajeel
Non-Executive Director, Member BoD, Chairperson BCGC, Vice Chairperson NRC, Member LFC BoD - retired May 2023
Mohamed Fekih Ahmed
Non-Executive Director, Member BoD, Member BCC, Member LFC BoD -retired May 2023
Rabih Soukarieh
Non-Executive Director, Member BoD, Vice Chairperson BCC
Rogers David LeBaron
Non-Executive Director, Member BoD, Member BCGC, Member NRC, Permanent Invitee BAC - retired May 2023
Sunny Bhatia
Non-Executive Director, Member BoD, BCGC, Member NRC
Mohamed Louhab
Non-Executive Director up to 30 November 2023, Executive Director as from 1 December 2023, Member BoD, Member BCC, Member BESGC, Non-voting Member BRIC, Member
LFC BoD and invitee on Board Committees
FIMBank Group Annual Report & Financial Statements 2023
36
Executive Directors and Deputy CEO
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 both the GCEO as well as the Deputy CEO.
In this respect, the tables below present information in respect of remuneration received by the Bank’s outgoing GCEO (Adrian A. Gostuski), the newly appointed GCEO (Mohammed Louhab) and the Deputy
GCEO (Simon Lay). Adrian A. Gostuski and Mohammed Louhab did not receive any remuneration from the Bank’s subsidiaries, whereas the Deputy CEO received all his remuneration from London Forfaiting
Company (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
** Extraordinary
Items
Pension Expense
Total
remuneration
Proportion of
fixed and variable
remuneration
USD
USD
USD
USD
USD
USD
USD
USD
USD
Mohammed Louhab
33,357
-
13,492
NA
NA
9,716
-
56,565
NA
Adrian A. Gostuski
367,069
-
130,521
267,931
-
-
-
765,522
65% : 35%
Simon Lay
463,642
-
126,070
62,150
-
-
75,502
727,364
91.5% : 8.5%
‘ * ‘ the amounts in respect of officers in the position GCEO include: Travel, Accommodation, Car, Parking, Mobile, Pension Plan Allowances and Health, Personal Accident and Life insurance cover; the amount in
respect of the officer in the role of Deputy CEO include a Pension Plan Allowance and Health and Life insurance cover.
‘ ** ’ the amount reflects the relocation flights and other related costs.
‘ *** ‘ Note: The remuneration attributable to Directors in respect of the financial year ended 31 December 2023 included in the table above represents the fixed remuneration attributable to performance year
2023 and the variable remuneration attributable to performance year 2022. This is due to the fact that the variable remuneration will only be formally determined and approved by the NRC subsequent to the
reporting date. The same methodology has been applied in respect of the remuneration attributable to Directors in respect of the prior financial years.
The variable remuneration awarded to the above-mentioned persons during the reporting year (performance bonus in respect of financial year 2022) reflects their overall performance. In determining the variable
remuneration of both the GCEO and the Deputy CEO. Their performance was assessed by the NRC 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 NRC approved the aforementioned performance bonus to the outgoing GCEO and the Deputy
CEO. This in view of the outgoing GCEO’s extraordinary efforts to strategically redirect the Group towards a more sustainable business model and Deputy CEO’s material contribution in ensuring that LFC remains
a profit-making entity for the Group also in 2022.
In accordance with the Group’s Remuneration Policy, no deferral requirements are applicable in respect of the variable remuneration awarded in respect of the financial year ended 31 December 2023. In addition,
the variable remuneration is payable in cash and, accordingly, no share-based remuneration was awarded to the GCEO or Deputy GCEO. Finally, none of the variable remuneration awarded in respect of the
financial year ended 31 December 2023 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 2023
37
An analysis of the annual change of remuneration paid to Executive Directors and the Deputy CEO over the last three financial years is presented hereunder:
* Difference
* Difference
* Difference
Name of executive
** 2023
2022
2021
2023 vs 2022
2022 vs 2021
2021 vs 2020
Notes
USD
USD
USD
%
%
%
Mohammed Louhab
56,565
NA
NA
NA
NA
NA
Appointed GCEO with effect from 1 December 2023. Annualised total remuneration would
amount to USD562,168 (excluding one-time relocation payment and any future variable
remuneration which may be awarded).
Adrian A. Gostuski
765,521
787,996
634,882
2.9
24.1
21.1
For the purposes of calculating the annual percentage change between 2023 and 2022, the fixed
remuneration received in 2023 was annualised considering the cessation of GCEO position on 30
November 2023, which would have resulted in total remuneration amounting to USD810,733 or a
2.9% increase compared to 2022.
Simon Lay
727,364
861,899
782,889
(15.6)
10.1
7.6
The decrease in the remuneration of the Deputy CEO of USD 134,535 or 15.6% is mainly due to
lower variable remuneration received in 2023 compared to 2022.
‘ * ‘ Differences also include fluctuation in rate of exchange.
‘ ** ‘ Note: The remuneration attributable to Directors in respect of the financial year ended 31 December 2023 included in the table above represents the fixed remuneration attributable to performance year
2023 and the variable remuneration attributable to performance year 2022. This is due to the fact that the variable remuneration will only be formally determined and approved by the NRC subsequent to the
reporting date. The same methodology has been applied in respect of the remuneration attributable to Directors in respect of the prior financial years.
The positions held by the Bank’s Executive Directors and Deputy CEO during the financial year ended 31 December 2023 are presented hereunder:
Name of executive
Position
Mohammed Louhab
With effect from 1st December 2023: GCEO and Executive Director FIMBank as above, Chairperson ALCO, Chairperson NCIC, Chairperson MCC, Chairperson TC
Member ERPC, Member ITSC, Member ORMC
Adrian A. Gostuski
Up to 30th November 2023: GCEO FIMBank, Chairperson MCC, Chairperson ALCO, Chairperson NCIC, Chairperson TC
From 1st December 2023: Member MCC, Member ALCO, Member NCIC, Member TC, Member ERPC, Member ITSC, Member ORMC, Non-Voting Member BRIC
Full year 2023: Chairperson Egypt Factors BoD, Chairperson India Factoring BoD, Chairperson FPI BoD, Member Brasil Factors BoD, Member FBS BoD
Simon Lay
Deputy CEO FIMBank, CEO LFC, Member MCC, Member ALCO, Member ERPC
FIMBank Group Annual Report & Financial Statements 2023
38
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 three most recent financial years.
Performance indicators
2023
2022
2021
2020
Difference
2023 vs 2022
Difference
2022 vs 2021
Difference
2021 vs 2020
USD
USD
USD
USD
%
%
%
Operating income/(loss) before net impairment
6,290,495
4,206,308
3,237,112
(5,823,426)
49.5
* 29.9
* 155.6
Net profit/(loss for the period
2,490,148
(22,010,084)
(663,219)
(55,976,602)
(111.3)
** (3,218.7)
* 98.8
Gross non-performing assets
20,605,923
94,001,953
119,068,469
174,337,048
(78.0)
* 21.1
* 31.7
‘ * ‘ Percentages in respect of FIMBank Performance are being shown as positive given that they denote improvements in these metrics.
‘ ** ’ Percentage in respect of FIMBank Performance is being shown as negative given that this figure denotes a deterioration in this metric.
Average remuneration on full-time equivalent basis of employee
2023
2022
2021
2020
Difference
2023 vs 2022
Difference
2022 vs 2021
Difference
2021 vs 2020
USD
USD
USD
USD
%
%
%
Employees of the Bank
74,684
77,158
79,792
75,851
(3.2)
(3.3)
5.2
FIMBank Group Annual Report & Financial Statements 2023
39
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 (2BESGC”)
• Board Nomination and Remuneration Committee (“NRC”)
• Board Review and Implementation Committee (“BRIC”)
• Board Risk Committee (“BRC”)
• Asset Liabilities Committee (ALCO)
• Management Credit Committee (“MCC”)
• Emerging Risk and Provisioning Committee (“ERPC”)
• IT Steering Committee (“ITSC”)
• Operational Risk Management Committee (“ORMC”)
• Non-Credit Insurance Committee (“NCIC”)
• Transformation Committee (“TC”)
The Directors’ Remuneration Report for 2022 was approved at the Annual General Meeting held on 4 May 2023 with the Resolution being passed
by 427,664,923 votes in favour, 52,603,658 “as he prefers” votes, 2,669,515 votes against and 2,583,354 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 2024 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 2023
40
Statements of financial position
Group
Group
31 December | 31 December | 1 January | ||
2023 | 2022 | 2022 | ||
Restated | Restated | |||
Note | USD | USD | USD | |
Assets | ||||
Balances with the Central Bank of Malta, treasury bills and cash | 19 | |||
Derivative assets held for risk management | 20 | |||
Trading assets | 21 | |||
Loans and advances to banks | 22 | |||
Loans and advances to customers | 23 | |||
Financial investments at fair value through profit or loss | 24 | |||
Financial investments at fair value through other comprehensive income | 25 | |||
Financial investments at amortised cost | 26 | |||
Property and equipment | 28 | |||
Investment property | 29 | |||
Intangible assets and goodwill | 31 | |||
Current tax assets | ||||
Deferred tax assets | 32 | |||
Other assets | 33 | |||
Total assets | ||||
Liabilities and equity | ||||
Liabilities | ||||
Derivative liabilities held for risk management | 20 | |||
Amounts owed to institutions and banks | 34 | |||
Amounts owed to customers | 35 | |||
Debt securities in issue | 36 | |||
Current tax liabilities | ||||
Deferred tax liabilities | 32 | |||
Provision for liabilities and charges | 37 | |||
Other liabilities | 38 | |||
Total liabilities | ||||
Equity | ||||
Called up share capital | 39 | |||
Share premium | 39 | |||
Reserve for general banking risks | 39 | |||
Currency translation reserve | 39 | ( | ( | ( |
Fair value reserve | 39 | ( | ( | |
Other reserve | 39 | |||
Accumulated losses | 39 | ( | ( | ( |
Total equity attributable to equity holders of the Group | ||||
Non-controlling interests | 40 | |||
Total equity | ||||
Total liabilities and equity | ||||
Memorandum items | ||||
Contingent liabilities | 41 | |||
Commitments | 42 |
FIMBank Group Annual Report & Financial Statements 2023
41
Statements of financial position
Bank
Bank
31 December
2023
31 December
2022
Restated
1 January
2022
Restated
Note
USD
USD
USD
Assets
Balances with the Central Bank of Malta, treasury bills and cash
19
352,997,057
216,852,467
239,982,048
Derivative assets held for risk management
20
812,609
1,610,475
841,688
Loans and advances to banks
22
114,325,243
125,882,432
182,458,548
Loans and advances to customers
23
618,118,225
718,910,427
724,767,858
Financial investments at fair value through profit or loss
24
19,329,840
18,179,220
19,966,163
Financial investments at fair value through other comprehensive income
25
140,755,780
143,189,022
162,408,542
Financial investments at amortised cost
26
28,399,073
14,602,008
9,914,754
Investments in subsidiaries
27
157,687,573
152,687,573
159,448,858
Property and equipment
28
2,994,784
4,770,241
1,965,249
Intangible assets
31
2,624,736
3,099,853
3,774,315
Current tax assets
-
-
66,667
Deferred tax assets
32
15,004,834
15,004,834
16,336,538
Other assets
33
7,747,110
6,830,284
8,919,842
Total assets
1,460,796,864
1,421,618,836
1,530,851,070
Liabilities and equity
Liabilities
Derivative liabilities held for risk management
20
626,476
818,031
1,533,556
Amounts owed to institutions and banks
34
333,498,402
386,787,784
497,633,356
Amounts owed to customers
35
951,166,330
869,220,415
822,950,838
Provision for liabilities and charges
37
90,135
121,209
201,775
Other liabilities
38
10,633,538
10,498,948
7,921,481
Total liabilities
1,296,014,881
1,267,446,387
1,330,241,006
Equity
Called up share capital
39
261,221,882
261,221,882
261,221,882
Share premium
39
858,885
858,885
858,885
Reserve for general banking risks
39
-
-
2,218,995
Fair value reserve
39
(17,382,450)
(25,501,836)
(1,074,305)
Other reserve
39
2,681,041
2,681,041
2,681,041
Accumulated losses
39
(82,597,375)
(85,087,523)
(65,296,434)
Total equity
164,781,983
154,172,449
200,610,064
Total liabilities and equity
1,460,796,864
1,421,618,836
1,530,851,070
Memorandum items
Contingent liabilities
41
42,331,477
38,670,533
44,398,883
Commitments
42
100,220,087
91,414,423
107,469,111
The official middle rate of exchange issued by the European Central Bank between US Dollar and Euro as at 31 December 2023 was 1.1050 (2022:
1.0666).
The Notes on pages 50 to 193 are an integral part of these Financial Statements.
The Financial Statements on pages 40 to 193 were approved and authorised for issue by the Board of Directors on 24 April 2024.
Approved by the Board of Directors and signed on its behalf by John C. Grech (Chairman) and Masaud M.J. Hayat (Vice Chairman) on 24 April
2024 as per Director’s Declaration on ESEF Annual Financial Report submitted in conjunction with the Annual Report and Financial Statements
2023.
FIMBank Group Annual Report & Financial Statements 2023
42
Statements of profit or loss
For the year ended 31 December
Group | Bank | ||||
2023 | 2022 | 2023 | 2022 | ||
Restated | Restated | ||||
Note | USD | USD | USD | USD | |
Interest income | 9 | 52,818,308 | 30,248,635 | ||
Interest expense | 9 | ( | ( | (33,156,902) | (13,509,191) |
Net interest income | 9 | 19,661,406 | 16,739,444 | ||
Fee and commission income | 10 | 3,116,178 | 2,744,994 | ||
Fee and commission expense | 10 | ( | ( | (1,206,187) | (1,924,794) |
Net fee and commission (expense)/income | 10 | ( | ( | 1,909,991 | 820,200 |
Net trading results | 11 | ( | ( | (921,644) | 1,411,029 |
Net gain/(loss) from equity investments measured at fair value through profit or loss | 12 | ( | 768,541 | (337,257) | |
Dividend income | 13 | 12,221,863 | 10,321,545 | ||
Net changes in fair value of investment property | 29 | ( | - | - | |
Other operating income | 14 | 328,330 | 566,474 | ||
Other operating expenses | 15 | ( | ( | (24,531) | (364,205) |
Operating income before net impairment | 33,943,956 | 29,157,230 | |||
Net movement in expected credit losses and other credit impairment charges | 5 | ( | ( | (2,993,592) | (17,424,101) |
Impairment of goodwill | 31 | ( | - | - | |
Impairment of investments in subsidiaries | 27 | - | - | - | (8,261,536) |
Operating income | 30,950,364 | 3,471,593 | |||
Administrative expenses | 16 | ( | ( | (24,824,525) | (22,139,252) |
Depreciation and amortisation | 28/31 | ( | ( | (2,828,936) | (2,811,670) |
Total operating expenses | ( | ( | (27,653,461) | (24,950,922) | |
Profit/(Loss) before tax | ( | 3,296,903 | (21,479,329) | ||
Taxation | 17 | ( | ( | (806,755) | (530,755) |
Profit/(Loss) for the year | ( | 2,490,148 | (22,010,084) | ||
Profit/(Loss) for the year attributable to: | |||||
Equity holders of the Bank | ( | ( | 2,490,148 | (22,010,084) | |
Non-controlling interests | 40 | ( | - | - | |
( | 2,490,148 | (22,010,084) | |||
Earnings per share | |||||
Basic earnings per share (US cents) | 18 | ( | ( | ||
The Notes on pages 50 to 193 are an integral part of these Financial Statements. |
FIMBank Group Annual Report & Financial Statements 2023
43
Statements of other comprehensive income
For the year ended 31 December
Group | Bank | ||||
2023 | 2022 | 2023 | 2022 | ||
Restated | Restated | ||||
USD | USD | USD | USD | ||
Profit/(Loss) for the year | ( | 2,490,148 | (22,010,084) | ||
Other comprehensive income: | |||||
Items that will not be reclassified subsequently to profit or loss: | |||||
Properties: | |||||
- | Surplus arising on revaluation | - | - | ||
- | Income tax | ( | - | - | |
- | - | ||||
Items that are or may be reclassified subsequently to Foreign operations - foreign currency translation differences | profit or loss: | ( | ( | - | - |
Debt instruments at fair value through other comprehensive income: | |||||
- | Fair value gains/(losses) | ( | 8,119,386 | (23,095,827) | |
- | Income tax | ( | - | (1,331,704) | |
( | 8,119,386 | (24,427,531) | |||
Other comprehensive income, net of tax | ( | 8,119,386 | (24,427,531) | ||
Other movements in comprehensive income | - | - | |||
Total comprehensive income | ( | 10,609,534 | (46,437,615) | ||
Total comprehensive income attributable to: | |||||
Equity holders of the Bank | ( | 10,609,534 | (46,437,615) | ||
Non-controlling interests | ( | - | - | ||
( | 10,609,534 | (46,437,615) |
FIMBank Group Annual Report & Financial Statements 2023
44
Statements of changes in equity
For the year ended 31 December 2023
Group
Called up | Currency | Attributable to equity holders of the Bank | Non- | |||||||
share | Share | translation | Fair value | Other | Accumulated | controlling | Total | |||
capital | premium | reserve | reserve 1 | reserve | losses | Total | interests | equity | ||
USD | USD | USD | USD | USD | USD | USD | USD | USD | ||
Balance at 1 January 2023 (as restated) | ( | ( | ( | |||||||
Total comprehensive income | ||||||||||
(Loss)/Profit for the year | ( | ( | ||||||||
Other comprehensive income: | ||||||||||
- | Debt instruments at fair value through other | |||||||||
comprehensive income - fair value gains, net of tax | ||||||||||
- | Surplus arising on revaluation of properties, net of tax | |||||||||
- | Foreign operations – foreign currency translation | |||||||||
differences | ( | ( | ( | ( | ||||||
Total other comprehensive income | ( | ( | ||||||||
Other movements in comprehensive income | ||||||||||
Total comprehensive income | ( | ( | ||||||||
Balance at 31 December 2023 | ( | ( | ( |
1
The fair value reserve as at 1 January 2023 has been restated to reflect the reversal of the reclassification of a portfolio of investments which was previously reported and measured at amortised cost and is now presented and measured
at fair value through other comprehensive income. Refer to Note 4 for an explanation of the impact.
FIMBank Group Annual Report & Financial Statements 2023
45
Statements of changes in equity
For the year ended 31 December 2022
Group
Reserve for | Attributable to equity holders of the Bank | ||||||||||
Called up | general | Currency | Non- | ||||||||
Share | Share | banking | translation | Fair value | Other | Accumulated | controlling | Total | |||
capital | premium | risks | reserve | reserve 2 | reserve | losses | Total | interests | equity | ||
USD | USD | USD | USD | USD | USD | USD | USD | USD | USD | ||
Balance at 1 January 2022 (as previously | reported) | ( | ( | ||||||||
Impact of reversal of reclassification of | investment portfolio (Note 4, 25.2) | ( | ( | ( | |||||||
Balance at 1 January 2022 (as restated) | ( | ( | |||||||||
Total comprehensive income | |||||||||||
Loss for the year | ( | ( | ( | ( | |||||||
Other comprehensive income: | |||||||||||
- | Debt instruments at fair value through | ||||||||||
other comprehensive income - fair | |||||||||||
value losses, net of tax (as restated) | ( | ( | ( | ||||||||
- | Surplus arising on revaluation of | ||||||||||
properties, net of tax | |||||||||||
- | Foreign operations - foreign currency | ||||||||||
translation differences | ( | ( | ( | ( | |||||||
Total other comprehensive income | ( | ( | ( | ( | ( | ||||||
Total comprehensive income | ( | ( | ( | ( | ( | ( | |||||
Transfer between reserves | ( | ||||||||||
Balance at 31 December 2022 (as restated) | ( | ( | ( | ||||||||
2
The fair value reserve as at 1 January 2022 and 31 December 2022 has been restated to reflect the reversal of the reclassification of a portfolio of investments which was previously reported and measured at amortised cost and is now
presented and measured at fair value through other comprehensive income. Refer to Note 4 for an explanation of the impact.
FIMBank Group Annual Report & Financial Statements 2023
46
Statements of changes in equity
For the year ended 31 December 2023
Bank
Called up
share
capital
Share
premium
Fair value
reserve
3
Other
reserve
Accumulated
losses
Total
equity
USD
USD
USD
USD
USD
USD
Balance at 1 January 2023 (as restated)
261,221,882
858,885
(25,501,836)
2,681,041
(85,087,523)
154,172,449
Total comprehensive income
Profit for the year
-
-
-
-
2,490,148
2,490,148
Other comprehensive income:
- Debt investments at fair value through other comprehensive income - fair value gains, net of tax
-
-
8,119,386
-
-
8,119,386
Total other comprehensive income
-
-
8,119,386
-
-
8,119,386
Total comprehensive income
-
-
8,119,386
-
2,490,148
10,609,534
Balance at 31 December 2023
261,221,882
858,885
(17,382,450)
2,681,041
(82,597,375)
164,781,983
3
The fair value reserve as at 1 January 2023 has been restated to reflect the reversal of the reclassification of a portfolio of investments which was previously reported and measured at amortised cost and is now presented and measured
at fair value through other comprehensive income. Refer to Note 4 for an explanation of the impact.
FIMBank Group Annual Report & Financial Statements 2023
47
Statements of changes in equity
For the year ended 31 December 2022
Bank
Called up
share
capital
Share
premium
Reserve for
general
banking
risks
Fair value
reserve
4
Other
reserve
Accumulated
losses
Total
equity
USD
USD
USD
USD
USD
USD
USD
Balance at 1 January 2022 (as previously reported)
261,221,882
858,885
2,218,995
-
2,681,041
(65,296,434)
201,684,369
Impact of reversal of reclassification of investment portfolio (Note 4, 25.2)
-
-
-
(1,074,305)
-
-
(1,074,305)
Balance at 1 January 2022 (as restated)
261,221,882
858,885
2,218,995
(1,074,305)
2,681,041
(65,296,434)
200,610,064
Total comprehensive income
Loss for the year
-
-
-
-
-
(22,010,084)
(22,010,084)
Other comprehensive income:
- Debt investments at fair value through other comprehensive income –
fair value losses, net of tax (as restated)
-
-
-
(24,427,531)
-
-
(24,427,531)
Total other comprehensive income
-
-
-
(24,427,531)
-
-
(24,427,531)
Total comprehensive income
-
-
-
(24,427,531)
-
(22,010,084)
(46,437,615)
Transfer between reserves
-
-
(2,218,995)
-
-
2,218,995
-
Balance at 31 December 2022 (as restated)
261,221,882
858,885
-
(25,501,836)
2,681,041
(85,087,523)
154,172,449
4
The fair value reserve as at 1 January 2022 and 31 December 2022 has been restated to reflect the reversal of the reclassification of a portfolio of investments which was previously reported and measured at amortised cost and is now
presented and measured at fair value through other comprehensive income. Refer to Note 4 for an explanation of the impact.
FIMBank Group Annual Report & Financial Statements 2023
48
Statements of cash flows
For the year ended 31 December
Group | Bank | |||||
2023 | 2022 | 2023 | 2022 | |||
Restated | Restated | |||||
USD | USD | USD | USD | |||
Cash flows from operating activities | ||||||
Interest and commission receipts | 52,462,009 | 40,370,717 | ||||
Interest and commission payments | ( | ( | (27,268,050) | (12,382,986) | ||
Payments to employees and suppliers | ( | ( | (24,275,402) | (22,429,122) | ||
Operating profit/(loss) before changes in operating | assets/liabilities | 918,557 | 5,558,609 | |||
Decrease/(Increase) in operating assets: | ||||||
– | Loans and advances to customers and banks | 91,123,276 | 36,058,246 | |||
– | Other assets | ( | ( | (632,506) | (2,884,544) | |
(Decrease)/Increase in operating liabilities: | ||||||
– | Amounts owed to customers, institutions and banks | ( | ( | (18,089,097) | (13,640,792) | |
– | Other liabilities | ( | 351,181 | (223,771) | ||
– | Net inflows from balances with subsidiary companies | - | - | 46,022,425 | (13,749,925) | |
Cash flows from/(used in) trading assets: | ||||||
– | Payments to acquire trading assets | ( | ( | - | - | |
– | Proceeds on settlement of trading assets | - | - | |||
Net cash generated from operating activities | before income tax | 119,693,836 | 11,117,823 | |||
Income tax paid | ( | ( | (806,755) | (476,091) | ||
Net cash flows generated from operating activities | 118,887,081 | 10,641,732 | ||||
Cash flows from/(used in) investing activities | ||||||
Payments to acquire financial investments at fair value | through other comprehensive income | ( | - | (25,549,207) | ||
Payments to acquire financial investments at amortised cost | ( | ( | (13,440,236) | (14,569,219) | ||
Payments to acquire treasury bills at amortised cost | ( | ( | (288,263,020) | (429,590,021) | ||
Payments to acquire shares in subsidiary companies | - | - | - | (252) | ||
Payments to acquire property and equipment | ( | ( | (34,872) | (916,620) | ||
Payments to acquire intangible assets | ( | ( | (490,433) | (318,308) | ||
Proceeds on settlement of financial investments at fair value | through profit or loss | 249,464 | 127,493 | |||
Proceeds on maturity of financial investments at fair value | through other comprehensive income | 13,745,002 | 13,000,000 | |||
Proceeds on maturity of financial investments at amortised cost | - | 9,800,719 | ||||
Proceeds on maturity of treasury bills at amortised cost | 288,934,098 | 296,265,806 | ||||
Proceeds on disposal of property and equipment | 27,500 | 1,565 | ||||
Receipt of dividends | 7,221,863 | 8,821,545 | ||||
Net cash flows from/(used in) investing activities | ( | 7,949,366 | (142,926,499) | |||
Increase/(Decrease) in cash and cash equivalents c/f | ( | 126,836,447 | (132,284,767) | |||
FIMBank Group Annual Report & Financial Statements 2023
49
Statements of cash flows
For the year ended 31 December
Group | Bank | ||||
2023 | 2022 | 2023 | 2022 | ||
Restated | Restated | ||||
USD | USD | USD | USD | ||
Increase/(Decrease) in cash and cash equivalents b/f | ( | 126,836,447 | (132,284,767) | ||
Cash flows from/(used in) financing activities | |||||
– | Proceeds on issue of debt securities | - | - | ||
– | Payments to settle debt securities | ( | ( | - | - |
– | Payment of lease liabilities | ( | ( | (1,450,567) | (1,330,082) |
Net cash flows from/(used in) financing activities | ( | (1,450,567) | (1,330,082) | ||
Effect of realised exchange (losses)/gains arising from cash | |||||
movements during the year | ( | (7,268,046) | 15,912,422 | ||
Increase/(Decrease) in cash and cash equivalents | ( | 118,117,834 | (117,702,427) | ||
Analysed as follows: | |||||
– | Effect of exchange rate changes on cash and cash equivalents | ( | 3,401,372 | (14,867,995) | |
– | Net increase/(decrease) in cash and cash equivalents | ( | 114,716,462 | (102,834,432) | |
Increase/(Decrease) in cash and cash equivalents | ( | 118,117,834 | (117,702,427) | ||
Cash and cash equivalents at beginning of year | ( | 9,611,898 | 127,314,325 | ||
Cash and cash equivalents at end of year | ( | 127,729,732 | 9,611,898 | ||
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Notes to the financial statements
For the year ended 31 December 2023
1
Reporting entity
25
Financial investments at fair value through
2
Basis of preparation
other comprehensive income
3
Material accounting policies
26
Financial investments at amortised cost
4
Comparative information
27
Investments in subsidiaries
5
Financial risk review
28
Property and equipment
6
Fair values of financial instruments
29
Investment property
7
Classification of financial assets and liabilities
30
Leases
8
Operating segments
31
Intangible assets and goodwill
9
Net interest income
32
Deferred taxation
10
Net fee and commission (expense)/ income
33
Other assets
11
Net trading results
34
Amounts owed to institutions and banks
12
Net gain/(loss) from equity investments measured
35
Amounts owed to customers
at fair value through profit or loss
36
Debt securities in issue
13
Dividend income
37
Provision for liabilities and charges
14
Other operating income
38
Other liabilities
15
Other operating expenses
39
Equity
16
Administrative expenses
40
Non-controlling interests
17
Taxation
41
Contingent liabilities
18
Earnings per share
42
Commitments
19
Balances with the Central Bank of Malta,
43
Cash and cash equivalents
treasury bills and cash
44
Related parties
20
Derivatives held for risk management
45
Capital commitments
21
Trading assets
46
Other commitments
22
Loans and advances to banks
47
Subsequent events
23
Loans and advances to customers
48
Ultimate parent company
24
Financial investments at fair value through profit or loss
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Notes to the financial statements
For the year ended 31 December 2023
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31 December | |||||
2022 | 31 December | ||||
as previously | Impact of | Impact of | 2022 | ||
reported | reclassification | remeasurement | as restated | ||
Statements of financial position | Note | USD | USD | USD | USD |
Assets | |||||
Balances with the Central Bank of Malta, treasury bills and cash | 19 | 211,898,623 | 4,968,702 | - | 216,867,325 |
Loans and advances to banks | 22 | 154,682,628 | (4,968,702) | - | 149,713,926 |
Loans and advances to customers | 23 | 592,785,152 | (2,538,650) | (105,718,445) | 484,528,057 |
Other assets | 33 | 5,372,830 | 2,538,650 | - | 7,911,490 |
Liabilities | |||||
Amounts owed to customers | 35 | 981,906,210 | - | (105,718,445) | 876,187,765 |
Memorandum items | |||||
Contingent liabilities | 41 | 12,134,442 | 2,538,650 | - | 14,673,092 |
Statements of profit or loss for the financial | |||||
year ended 31 December 2022 | |||||
Interest income | 9 | 48,000,111 | 13,433,551 | - | 61,433,662 |
Fee and commission income | 10 | 18,019,213 | (14,019,155) | - | 4,000,058 |
Fee and commission expense | 10 | (6,590,340) | 585,604 | - | (6,004,736) |
Group – 1 January 2022 | |||||
1 January | |||||
2022 | 1 January | ||||
as previously | Impact of | Impact of | 2022 | ||
reported | reclassification | remeasurement | as restated | ||
Statements of financial position | Note | USD | USD | USD | USD |
Assets | |||||
Balances with the Central Bank of Malta, treasury bills and cash | 19 | 239,998,839 | - | - | 239,998,839 |
Loans and advances to banks | 22 | 198,488,576 | - | - | 198,488,576 |
Loans and advances to customers | 23 | 628,912,340 | (5,071,521) | (111,921,417) | 511,919,402 |
Other assets | 33 | 4,244,384 | 5,071,521 | - | 9,315,905 |
Liabilities | |||||
Amounts owed to customers | 35 | 934,096,196 | - | (111,921,417) | 822,174,779 |
Memorandum items | |||||
Contingent liabilities | 41 | 1,950,534 | 5,071,521 | - | 7,022,055 |
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31 December | |||||
2022 | 31 December | ||||
as previously | Impact of | Impact of | 2022 | ||
reported | reclassification | remeasurement | as restated | ||
Statements of financial position | Note | USD | USD | USD | USD |
Assets | |||||
Balances with the Central Bank of Malta, treasury bills and cash | 19 | 211,883,765 | 4,968,702 | - | 216,852,467 |
Loans and advances to banks | 22 | 130,851,134 | (4,968,702) | - | 125,882,432 |
Loans and advances to customers | 23 | 729,767,493 | (2,538,650) | (8,318,416) | 718,910,427 |
Other assets | 33 | 4,291,634 | 2,538,650 | - | 6,830,284 |
Liabilities | |||||
Amounts owed to customers | 35 | 877,538,831 | - | (8,318,416) | 869,220,415 |
Memorandum items | |||||
Contingent liabilities | 41 | 36,131,883 | 2,538,650 | - | 38,670,533 |
Statements of profit or loss for the financial | |||||
year ended 31 December 2022 | |||||
Interest income | 9 | 27,401,735 | 2,846,900 | - | 30,248,635 |
Fee and commission income | 10 | 6,177,499 | (3,432,505) | - | 2,744,994 |
Fee and commission expense | 10 | (2,510,399) | 585,605 | - | (1,924,794) |
1 January | |||||
2022 | 1 January | ||||
as previously | Impact of | Impact of | 2022 | ||
reported | reclassification | remeasurement | as restated | ||
Statements of financial position | Note | USD | USD | USD | USD |
Assets | |||||
Balances with the Central Bank of Malta, treasury bills and cash | 19 | 239,982,048 | - | - | 239,982,048 |
Loans and advances to banks | 22 | 182,458,548 | - | - | 182,458,548 |
Loans and advances to customers | 23 | 745,564,139 | (5,071,521) | (15,724,760) | 724,767,858 |
Other assets | 33 | 3,848,321 | 5,071,521 | - | 8,919,842 |
Liabilities | |||||
Amounts owed to customers | 35 | 838,675,598 | - | (15,724,760) | 822,950,838 |
Memorandum items | |||||
Contingent liabilities | 41 | 39,327,362 | 5,071,521 | - | 44,398,883 |
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Group | Bank | ||||
2023 | 2022 | 2023 | 2022 | ||
Restated | Restated | ||||
USD | USD | USD | USD | ||
Balances with the Central Bank of Malta, treasury bills and cash | 353,010,186 | 216,867,325 | 352,997,057 | 216,852,467 | |
Loans and advances to banks | 152,814,948 | 149,713,926 | 114,325,243 | 125,882,432 | |
Loans and advances to customers | 431,342,074 | 484,528,057 | 618,118,225 | 718,910,427 | |
Financial investments at fair value through other comprehensive income | 140,755,780 | 143,189,022 | 140,755,780 | 143,189,022 | |
Financial investments at amortised cost | 28,399,073 | 14,602,008 | 28,399,073 | 14,602,008 | |
Other assets | 5,007,323 | 4,097,953 | 4,457,961 | 3,799,997 | |
Off-balance sheet: | |||||
- | Guarantees | 28,025,274 | 12,134,442 | 39,074,998 | 36,131,883 |
- | Commitments | 147,803,707 | 100,001,463 | 100,220,087 | 91,414,423 |
1,287,158,365 | 1,125,134,196 | 1,398,348,424 | 1,350,782,659 |
Group | Bank | |||
2023 | 2022 | 2023 | 2022 | |
USD | USD | USD | USD | |
Derivative assets held for risk management | 715,713 | 1,610,475 | 812,609 | 1,610,475 |
Trading assets | 374,177,108 | 444,583,661 | - | - |
Financial investments at fair value through profit or loss | 19,329,840 | 18,179,220 | 19,329,840 | 18,179,220 |
394,222,661 | 464,373,356 | 20,142,449 | 19,789,695 |
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Grading | 12-month weighted-average PD | External rating |
Grades 1 to 4- low risk | 0.19% | Aaa-Baa3 |
Grades 5+ to 5- fair risk | 1.90% | Ba1-Ba3 |
Grades 6+ to 7 high risk | 4.81% | B1-Caa2 |
Grades 7- to 8- substandard | 15.46% | Caa3-Ca |
Grades 9 to 10 doubtful/loss | 100.00% | C |
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2023 | |||||
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 | 0.03% - 0.44% | 336,709,471 | - | - | 336,709,471 |
Grades 5+ to 5- fair risk | 0.36% - 0.36% | 16,384,741 | - | - | 16,384,741 |
353,094,212 | - | - | 353,094,212 | ||
Loss allowance | (84,026) | - | - | (84,026) | |
Carrying amount | 353,010,186 | - | - | 353,010,186 | |
Loans and advances to banks | |||||
Grades 1 to 4- low risk | 0.18% - 0.71% | 57,774,145 | - | - | 57,774,145 |
Grades 5+ to 5- fair risk | 0.39% - 1.36% | 28,897,955 | - | - | 28,897,955 |
Grades 6+ to 7 high risk | 1.03% - 5.33% | 61,678,406 | 4,373,226 | - | 66,051,632 |
Grade 7- to 8- substandard | 2.45% | - | 330,800 | - | 330,800 |
148,350,506 | 4,704,026 | - | 153,054,532 | ||
Loss allowance | (229,755) | (9,829) | - | (239,584) | |
Carrying amount | 148,120,751 | 4,694,197 | - | 152,814,948 | |
Loans and advances to customers | |||||
Grades 1 to 4- low risk | 0.09% - 0.96% | 14,877,147 | 8,532 | - | 14,885,679 |
Grades 5+ to 5- fair risk | 0.47% - 7.58% | 106,621,284 | 16,552,944 | - | 123,174,228 |
Grades 6+ to 7 high risk | 1.34% - 19.01% | 193,343,710 | 14,192,197 | - | 207,535,907 |
Grade 7- to 8- substandard | 11.65% - 23.98% | 33,480,002 | 44,064,180 | 3,667,626 | 81,211,808 |
Grade 9 to 10 doubtful/loss | 100% | - | - | 23,447,745 | 23,447,745 |
348,322,143 | 74,817,853 | 27,115,371 | 450,255,367 | ||
Loss allowance | (1,992,933) | (3,235,201) | (13,685,159) | (18,913,293) | |
Carrying amount | 346,329,210 | 71,582,652 | 13,430,212 | 431,342,074 | |
Financial investments at fair value through other comprehensive income | |||||
Grades 1 to 4- low risk | 0.03% - 0.5% | 140,755,780 | - | - | 140,755,780 |
Carrying amount at fair value | 140,755,780 | - | - | 140,755,780 | |
Loss allowance | (83,233) | - | - | (83,233) | |
Financial investments at amortised cost | |||||
Grades 1 to 4- low risk | 0.02% - 0.46% | 18,758,990 | - | - | 18,758,990 |
Grades 5+ to 5- fair risk | 2.25% | 9,771,244 | - | - | 9,771,244 |
28,530,234 | - | - | 28,530,234 | ||
Loss allowance | (131,161) | - | - | (131,161) | |
Carrying amount | 28,399,073 | - | - | 28,399,073 | |
Guarantees | |||||
Grades 1 to 4- low risk | 0.14% - 0.96% | 239,527 | - | - | 239,527 |
Grades 5+ to 5- fair risk | 0.42% - 2.99% | 24,272,567 | - | - | 24,272,567 |
Grades 6+ to 7 high risk | 1.48% - 18.65% | 3,483,111 | 30,069 | - | 3,513,180 |
Carrying amount | 27,995,205 | 30,069 | - | 28,025,274 | |
Loss allowance | (7,501) | (50) | - | (7,551) | |
Commitments | |||||
Grades 1 to 4- low risk | 0.16% - 0.78% | 40,457,254 | - | - | 40,457,254 |
Grades 5+ to 5- fair risk | 1.16% - 3.15% | 40,310,914 | 1,235,036 | - | 41,545,950 |
Grades 6+ to 7 high risk | 1.83% - 10.76% | 54,509,463 | 11,291,040 | - | 65,800,503 |
Carrying amount | 135,277,631 | 12,526,076 | - | 147,803,707 | |
Loss allowance | (78,764) | (3,543) | - | (82,307) |
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2022 | |||||
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 | 0.11% - 0.61% | 201,055,654 | - | - | 201,055,654 |
Grades 5+ to 5- fair risk | 0.56% - 0.57% | 15,929,718 | - | - | 15,929,718 |
216,985,372 | - | - | 216,985,372 | ||
Loss allowance | (118,047) | - | - | (118,047) | |
Carrying amount | 216,867,325 | - | - | 216,867,325 | |
Loans and advances to banks | |||||
Grades 1 to 4- low risk | 0.16% - 0.82% | 53,973,155 | - | - | 53,973,155 |
Grades 5+ to 5- fair risk | 0.64% - 4.39% | 8,899,263 | - | - | 8,899,263 |
Grades 6+ to 7 high risk | 1.2% - 7.34% | 86,272,654 | - | - | 86,272,654 |
Grade 7- to 8- substandard | 5.38% | - | 1,011,069 | - | 1,011,069 |
149,145,072 | 1,011,069 | - | 150,156,141 | ||
Loss allowance | (425,805) | (16,410) | - | (442,215) | |
Carrying amount | 148,719,267 | 994,659 | - | 149,713,926 | |
Loans and advances to customers | |||||
Grades 1 to 4- low risk | 0.08% - 0.9% | 41,340,443 | 560,550 | - | 41,900,993 |
Grades 5+ to 5- fair risk | 0.38% - 3.53% | 136,285,389 | 15,840,557 | - | 152,125,946 |
Grades 6+ to 7 high risk | 2.52% - 32.46% | 150,749,736 | 67,155,643 | - | 217,905,379 |
Grade 7- to 8- substandard | 16.16% - 40.49% | 4,076,786 | 41,064,034 | - | 45,140,820 |
Grade 9 to 10 doubtful/loss | 100% | - | - | 102,531,826 | 102,531,826 |
332,452,354 | 124,620,784 | 102,531,826 | 559,604,964 | ||
Loss allowance | (1,807,610) | (3,738,804) | (69,530,493) | (75,076,907) | |
Carrying amount | 330,644,744 | 120,881,980 | 33,001,333 | 484,528,057 | |
Financial investments at fair value through other comprehensive income | |||||
Grades 1 to 4- low risk | 0.03% - 0.67% | 143,189,022 | - | - | 143,189,022 |
Carrying amount at fair value | 143,189,022 | - | - | 143,189,022 | |
Loss allowance | (125,577) | - | - | (125,577) | |
Financial investments at amortised cost | |||||
Grades 1 to 4- low risk | 0.05% | 4,835,740 | - | - | 4,835,740 |
Grades 5+ to 5- fair risk | 0.93% | 9,805,955 | - | - | 9,805,955 |
14,641,695 | - | - | 14,641,695 | ||
Loss allowance | (39,687) | - | - | (39,687) | |
Carrying amount | 14,602,008 | - | - | 14,602,008 | |
Guarantees | |||||
Grades 1 to 4- low risk | 0.29% - 0.84% | 91,324 | - | - | 91,324 |
Grades 5+ to 5- fair risk | 0.87% - 3.11% | 7,516,187 | 4,127 | - | 7,520,314 |
Grades 6+ to 7 high risk | 1.56% - 17.53% | 4,270,380 | 85,847 | - | 4,356,227 |
Grade 9 to 10 doubtful/loss | 100% | - | - | 166,577 | 166,577 |
Carrying amount | 11,877,891 | 89,974 | 166,577 | 12,134,442 | |
Loss allowance | (43,668) | (107) | - | (43,775) | |
Commitments | |||||
Grades 1 to 4- low risk | 0.16% - 0.94% | 5,902,394 | - | - | 5,902,394 |
Grades 5+ to 5- fair risk | 1.09% - 3.16% | 53,329,456 | - | - | 53,329,456 |
Grades 6+ to 7 high risk | 1.8% - 29.66% | 26,733,134 | 14,036,479 | - | 40,769,613 |
Carrying amount | 85,964,984 | 14,036,479 | - | 100,001,463 | |
Loss allowance | (274,242) | (2,878) | - | (277,120) |
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2023 | |||||
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 | 0.03% - 0.44% | 336,696,342 | - | - | 336,696,342 |
Grades 5+ to 5- fair risk | 0.36% - 0.36% | 16,384,741 | - | - | 16,384,741 |
353,081,083 | - | - | 353,081,083 | ||
Loss allowance | (84,026) | - | - | (84,026) | |
Carrying amount | 352,997,057 | - | - | 352,997,057 | |
Loans and advances to banks | |||||
Grades 1 to 4- low risk | 0.18% - 0.71% | 34,600,459 | - | - | 34,600,459 |
Grades 5+ to 5- fair risk | 0.39% - 1.36% | 21,922,395 | - | - | 21,922,395 |
Grades 6+ to 7 high risk | 1.16% - 5.33% | 53,314,041 | 4,373,226 | - | 57,687,267 |
Grade 7- to 8- substandard | 2.45% | - | 330,800 | - | 330,800 |
109,836,895 | 4,704,026 | - | 114,540,921 | ||
Loss allowance | (205,849) | (9,829) | - | (215,678) | |
Carrying amount | 109,631,046 | 4,694,197 | - | 114,325,243 | |
Loans and advances to customers | |||||
Grades 1 to 4- low risk | 0.14% - 0.96% | 326,508,825 | - | - | 326,508,825 |
Grades 5+ to 5- fair risk | 0.47% - 7.58% | 76,001,131 | 15,899,916 | - | 91,901,047 |
Grades 6+ to 7 high risk | 1.34% - 19.01% | 171,722,482 | 13,149,304 | - | 184,871,786 |
Grade 7- to 8- substandard | 15% - 21.07% | - | 7,017,657 | 3,667,626 | 10,685,283 |
Grade 9 to 10 doubtful/loss | 100% | - | - | 16,938,297 | 16,938,297 |
574,232,438 | 36,066,877 | 20,605,923 | 630,905,238 | ||
Loss allowance | (2,749,760) | (2,641,065) | (7,396,188) | (12,787,013) | |
Carrying amount | 571,482,678 | 33,425,812 | 13,209,735 | 618,118,225 | |
Financial investments at fair value through other comprehensive income | |||||
Grades 1 to 4- low risk | 0.03% - 0.5% | 140,755,780 | - | - | 140,755,780 |
Carrying amount at fair value | 140,755,780 | - | - | 140,755,780 | |
Loss allowance | (83,233) | - | - | (83,233) | |
Financial investments at amortised cost | |||||
Grades 1 to 4- low risk | 0.02% - 0.46% | 18,758,990 | - | - | 18,758,990 |
Grades 5+ to 5- fair risk | 2.25% | 9,771,244 | - | - | 9,771,244 |
28,530,234 | - | - | 28,530,234 | ||
Loss allowance | (131,161) | - | - | (131,161) | |
Carrying amount | 28,399,073 | - | - | 28,399,073 | |
Guarantees | |||||
Grades 1 to 4- low risk | 0.39% - 0.96% | 11,289,250 | - | - | 11,289,250 |
Grades 5+ to 5- fair risk | 0.42% - 2.99% | 24,272,567 | - | - | 24,272,567 |
Grades 6+ to 7 high risk | 1.48% - 18.65% | 3,483,112 | 30,069 | - | 3,513,181 |
Carrying amount | 39,044,929 | 30,069 | - | 39,074,998 | |
Loss allowance | (7,778) | (50) | - | (7,828) | |
Commitments | |||||
Grades 1 to 4- low risk | 0.16% - 0.78% | 6,727,973 | - | - | 6,727,973 |
Grades 5+ to 5- fair risk | 1.16% - 3.15% | 40,310,914 | 1,235,036 | - | 41,545,950 |
Grades 6+ to 7 high risk | 1.83% - 10.76% | 40,655,124 | 11,291,040 | - | 51,946,164 |
Carrying amount | 87,694,011 | 12,526,076 | - | 100,220,087 | |
Loss allowance | (78,764) | (3,543) | - | (82,307) |
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2022 | |||||
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 | 0.11% - 0.61% | 201,040,796 | - | - | 201,040,796 |
Grades 5+ to 5- fair risk | 0.56% - 0.57% | 15,929,718 | - | - | 15,929,718 |
216,970,514 | - | - | 216,970,514 | ||
Loss allowance | (118,047) | - | - | (118,047) | |
Carrying amount | 216,852,467 | - | - | 216,852,467 | |
Loans and advances to banks | |||||
Grades 1 to 4- low risk | 0.16% - 0.82% | 51,827,402 | - | - | 51,827,402 |
Grades 6+ to 7 high risk | 1.2% - 6.36% | 73,491,266 | - | - | 73,491,266 |
Grade 7- to 8- substandard | 5.38% | - | 981,535 | - | 981,535 |
125,318,668 | 981,535 | - | 126,300,203 | ||
Loss allowance | (406,843) | (10,928) | - | (417,771) | |
Carrying amount | 124,911,825 | 970,607 | - | 125,882,432 | |
Loans and advances to customers | |||||
Grades 1 to 4- low risk | 0.12% - 0.87% | 374,043,203 | - | - | 374,043,203 |
Grades 5+ to 5- fair risk | 0.38% - 3.16% | 107,707,494 | 15,683,049 | - | 123,390,543 |
Grades 6+ to 7 high risk | 2.96% - 32.46% | 139,237,803 | 49,388,541 | - | 188,626,344 |
Grade 7- to 8- substandard | 16.57% - 33.05% | - | 7,375,878 | - | 7,375,878 |
Grade 9 to 10 doubtful/loss | 100% | - | - | 93,835,376 | 93,835,376 |
620,988,500 | 72,447,468 | 93,835,376 | 787,271,344 | ||
Loss allowance | (1,730,647) | (2,562,047) | (64,068,223) | (68,360,917) | |
Carrying amount | 619,257,853 | 69,885,421 | 29,767,153 | 718,910,427 | |
Financial investments at fair value through other comprehensive income | |||||
Grades 1 to 4- low risk | 0.03% - 0.67% | 143,189,022 | - | - | 143,189,022 |
Carrying amount at fair value | 143,189,022 | - | - | 143,189,022 | |
Loss allowance | (125,577) | - | - | (125,577) | |
Financial investments at amortised cost | |||||
Grades 1 to 4- low risk | 0.05% | 4,835,740 | - | - | 4,835,740 |
Grades 5+ to 5- fair risk | 0.93% | 9,805,955 | - | - | 9,805,955 |
14,641,695 | - | - | 14,641,695 | ||
Loss allowance | (39,687) | - | - | (39,687) | |
Carrying amount | 14,602,008 | - | - | 14,602,008 | |
Guarantees | |||||
Grades 1 to 4- low risk | 0.12% - 0.84% | 24,095,625 | - | - | 24,095,625 |
Grades 5+ to 5- fair risk | 0.87% - 3.11% | 7,516,188 | 4,127 | - | 7,520,315 |
Grades 6+ to 7 high risk | 1.56% - 17.53% | 4,263,519 | 85,847 | - | 4,349,366 |
Grade 9 to 10 doubtful/loss | 100% | - | - | 166,577 | 166,577 |
Carrying amount | 35,875,332 | 89,974 | 166,577 | 36,131,883 | |
Loss allowance | (75,317) | (107) | - | (75,424) | |
Commitments | |||||
Grades 1 to 4- low risk | 0.16% - 0.94% | 6,455,110 | - | - | 6,455,110 |
Grades 5+ to 5- fair risk | 1.25% - 3.16% | 52,776,740 | - | - | 52,776,740 |
Grades 6+ to 7 high risk | 2.5% - 29.66% | 18,146,094 | 14,036,479 | - | 32,182,573 |
Carrying amount | 77,377,944 | 14,036,479 | - | 91,414,423 | |
Loss allowance | (42,904) | (2,881) | - | (45,785) |
FIMBank Group Annual Report & Financial Statements 2023
91
2023 | ||||
Stage 1 | Stage 2 | Stage 3 | Total | |
USD | USD | USD | USD | |
Loans and advances to banks | ||||
Current | 143,786,835 | 4,704,026 | - | 148,490,861 |
Overdue < 30 days | 4,563,671 | - | - | 4,563,671 |
Overdue > 30 days | - | - | - | - |
Total gross carrying amount | 148,350,506 | 4,704,026 | - | 153,054,532 |
Loans and advances to customers | ||||
Current | 286,929,554 | 38,938,409 | - | 325,867,963 |
Overdue < 30 days | 61,392,589 | 31,308,055 | - | 92,700,644 |
Overdue > 30 days | - | 4,571,389 | 27,115,371 | 31,686,760 |
Total gross carrying amount | 348,322,143 | 74,817,853 | 27,115,371 | 450,255,367 |
2022 | ||||
Stage 1 | Stage 2 | Stage 3 | Total | |
USD | USD | USD | USD | |
Loans and advances to banks | ||||
Current | 149,145,072 | 1,011,069 | - | 150,156,141 |
Overdue < 30 days | - | - | - | - |
Overdue > 30 days | - | - | - | - |
Total gross carrying amount | 149,145,072 | 1,011,069 | - | 150,156,141 |
Loans and advances to customers | ||||
Current | 282,933,798 | 121,255,571 | - | 404,189,369 |
Overdue < 30 days | 49,518,556 | 492,684 | - | 50,011,240 |
Overdue > 30 days | - | 2,872,529 | 102,531,826 | 105,404,355 |
Total gross carrying amount | 332,452,354 | 124,620,784 | 102,531,826 | 559,604,964 |
2023 | ||||
Stage 1 | Stage 2 | Stage 3 | Total | |
USD | USD | USD | USD | |
Loans and advances to banks | ||||
Current | 105,273,224 | 4,704,026 | - | 109,977,250 |
Overdue < 30 days | 4,563,671 | - | - | 4,563,671 |
Overdue > 30 days | - | - | - | - |
Total gross carrying amount | 109,836,895 | 4,704,026 | - | 114,540,921 |
Loans and advances to customers | ||||
Current | 547,798,597 | 22,954,067 | - | 570,752,664 |
Overdue < 30 days | 26,433,841 | 8,644,572 | - | 35,078,413 |
Overdue > 30 days | - | 4,468,238 | 20,605,923 | 25,074,161 |
Total gross carrying amount | 574,232,438 | 36,066,877 | 20,605,923 | 630,905,238 |
FIMBank Group Annual Report & Financial Statements 2023
92
2022 | ||||
Stage 1 | Stage 2 | Stage 3 | Total | |
USD | USD | USD | USD | |
Loans and advances to banks | ||||
Current | 125,318,668 | 981,535 | - | 126,300,203 |
Overdue < 30 days | - | - | - | - |
Overdue > 30 days | - | - | - | - |
Total gross carrying amount | 125,318,668 | 981,535 | - | 126,300,203 |
Loans and advances to customers | ||||
Current | 589,669,783 | 71,855,938 | - | 661,525,721 |
Overdue < 30 days | 31,318,717 | 261,675 | - | 31,580,392 |
Overdue > 30 days | - | 329,855 | 93,835,376 | 94,165,231 |
Total gross carrying amount | 620,988,500 | 72,447,468 | 93,835,376 | 787,271,344 |
Group | ||
2023 | 2022 | |
USD | USD | |
Trading assets | ||
Rated A- to A+ | 22,310,275 | 5,447,684 |
Rated BBB+ or below | 242,218,978 | 263,545,485 |
Unrated | 109,647,855 | 175,590,492 |
Carrying amount | 374,177,108 | 444,583,661 |
FIMBank Group Annual Report & Financial Statements 2023
93
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 | 332,452,354 | (1,807,610) | 124,620,784 | (3,738,804) | 102,531,826 | (69,530,493) | 559,604,964 | (75,076,907) |
Transfer to Stage 1 | 6,971,978 | (126,023) | (6,971,978) | 126,023 | - | - | - | - |
Transfer to Stage 2 | (832,499) | 3 | 832,499 | (3) | - | - | - | - |
Net remeasurement of loss allowance arising from stage transfers | - | (42,479) | - | (3,462) | - | - | - | (45,941) |
Changes in risk parameters | - | (190,907) | - | 263,929 | - | (1,113,923) | - | (1,040,901) |
New financial assets originated or purchased and further lending | 408,211,815 | (1,489,020) | 45,065,103 | (209,007) | 54,684 | (38,406) | 453,331,602 | (1,736,433) |
Financial assets that have been repaid or partially repaid | (403,901,641) | 1,662,934 | (87,356,483) | 299,504 | (16,812,662) | 1,394,348 | (508,070,786) | 3,356,786 |
Write-offs | - | - | (65,007) | 26,711 | (59,663,556) | 56,149,594 | (59,728,563) | 56,176,305 |
Foreign exchange and other movements | 5,420,136 | 169 | (1,307,065) | (92) | 1,005,079 | (546,279) | 5,118,150 | (546,202) |
Balance at 31 December | 348,322,143 | (1,992,933) | 74,817,853 | (3,235,201) | 27,115,371 | (13,685,159) | 450,255,367 | (18,913,293) |
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 | 320,415,637 | (1,267,844) | 134,133,565 | (2,740,295) | 140,155,054 | (78,776,715) | 594,704,256 | (82,784,854) |
Transfer to Stage 1 | 6,322,485 | (24,819) | (6,322,485) | 24,819 | - | - | - | - |
Transfer to Stage 2 | (5,364,350) | 3,820 | 5,885,579 | (485,677) | (521,229) | 481,857 | - | - |
Transfer to Stage 3 | - | - | (304,380) | 1,813 | 304,380 | (1,813) | - | - |
Net remeasurement of loss allowance arising from stage transfers | - | (93,215) | - | 336,595 | - | 23,767 | - | 267,147 |
Changes in risk parameters | - | 526,220 | - | (940,622) | - | (2,027,017) | - | (2,441,419) |
New financial assets originated or purchased and further lending | 374,613,473 | (1,148,374) | 49,891,502 | (229,265) | 6,827,172 | (183,080) | 431,332,147 | (1,560,719) |
Financial assets that have been repaid or partially repaid | (349,840,884) | 161,387 | (52,986,986) | 297,467 | (4,166,719) | 1,099,422 | (406,994,589) | 1,558,276 |
Write-offs | - | - | - | - | (32,712,595) | 13,412,727 | (32,712,595) | 13,412,727 |
Foreign exchange and other movements | (13,694,007) | 35,215 | (5,676,011) | (3,639) | (7,354,237) | (3,559,641) | (26,724,251) | (3,528,065) |
Balance at 31 December | 332,452,354 | (1,807,610) | 124,620,784 | (3,738,804) | 102,531,826 | (69,530,493) | 559,604,964 | (75,076,907) |
FIMBank Group Annual Report & Financial Statements 2023
94
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 | 620,988,500 | (1,730,647) | 72,447,468 | (2,562,047) | 93,835,376 | (64,068,223) | 787,271,344 | (68,360,917) |
Transfer to Stage 1 | 18,021 | - | (18,021) | - | - | - | - | - |
Transfer to Stage 2 | (832,479) | 3 | 832,479 | (3) | - | - | - | - |
Net remeasurement of loss allowance arising from stage transfers | - | - | - | (3,462) | - | - | - | (3,462) |
Changes in risk parameters | - | (859,172) | - | (156,717) | - | 121,343 | - | (894,546) |
New financial assets originated or purchased and further lending | 337,283,426 | (1,372,156) | 27,933,694 | (11,111) | 54,684 | (38,406) | 365,271,804 | (1,421,673) |
Financial assets that have been repaid or partially repaid | (396,312,437) | 1,212,212 | (65,168,753) | 65,564 | (15,182,710) | 1,280,426 | (476,663,900) | 2,558,202 |
Write-offs | - | - | (65,007) | 26,711 | (59,583,023) | 56,069,062 | (59,648,030) | 56,095,773 |
Foreign exchange and other movements | 13,087,407 | - | 105,017 | - | 1,481,596 | (760,390) | 14,674,020 | (760,390) |
Balance at 31 December | 574,232,438 | (2,749,760) | 36,066,877 | (2,641,065) | 20,605,923 | (7,396,188) | 630,905,238 | (12,787,013) |
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 | 600,778,464 | (1,663,749) | 74,589,203 | (2,051,951) | 118,357,177 | (65,241,286) | 793,724,844 | (68,956,986) |
Transfer to Stage 1 | 3,957,968 | (431) | (3,957,968) | 431 | - | - | - | - |
Transfer to Stage 2 | (159,987) | - | 681,216 | (481,857) | (521,229) | 481,857 | - | - |
Net remeasurement of loss allowance arising from stage transfers | - | - | - | 488,329 | - | - | - | 488,329 |
Changes in risk parameters | - | 384,082 | - | (541,489) | - | (1,157,112) | - | (1,314,519) |
New financial assets originated or purchased and further lending | 371,417,048 | (647,590) | 24,861,234 | (65,375) | 6,764,122 | (183,080) | 403,042,404 | (896,045) |
Financial assets that have been repaid or partially repaid | (339,546,202) | 197,041 | (23,006,984) | 96,337 | (4,467,856) | 233,802 | (367,021,042) | 527,180 |
Write-offs | - | - | - | - | (23,381,257) | 6,640,123 | (23,381,257) | 6,640,123 |
Foreign exchange and other movements | (15,458,791) | - | (719,233) | (6,472) | (2,915,581) | (4,842,527) | (19,093,605) | (4,848,999) |
Balance at 31 December | 620,988,500 | (1,730,647) | 72,447,468 | (2,562,047) | 93,835,376 | (64,068,223) | 787,271,344 | (68,360,917) |
FIMBank Group Annual Report & Financial Statements 2023
95
2023 | ||||
Allowance for ECL | ||||
Stage 1 | Stage 2 | Stage 3 | Total | |
USD | USD | USD | USD | |
Balances with the Central Bank of Malta, treasury bills | ||||
and cash | ||||
Balance at 1 January | 118,047 | - | - | 118,047 |
Net remeasurement of loss allowance | (46,750) | - | - | (46,750) |
New financial assets originated or purchased | ||||
and further lending | 76,808 | - | - | 76,808 |
Financial assets that have been repaid or partially repaid | (64,079) | - | - | (64,079) |
Balance at 31 December | 84,026 | - | - | 84,026 |
Loans and advances to banks | ||||
Balance at 1 January | 425,805 | 16,410 | - | 442,215 |
Net remeasurement of loss allowance | (57,382) | (10,753) | - | (68,135) |
New financial assets originated or purchased | ||||
and further lending | 93,845 | 9,653 | - | 103,498 |
Financial assets that have been repaid or partially repaid | (232,418) | (5,481) | - | (237,899) |
Foreign exchange and other movements | (95) | - | - | (95) |
Balance at 31 December | 229,755 | 9,829 | - | 239,584 |
Financial investments at fair value through other comprehensive income | ||||
Balance at 1 January | 125,577 | - | - | 125,577 |
Net remeasurement of loss allowance | (38,948) | - | - | (38,948) |
Financial assets that have been repaid or partially repaid | (3,396) | - | - | (3,396) |
Balance at 31 December | 83,233 | - | - | 83,233 |
Financial investments at amortised cost | ||||
Balance at 1 January | 39,687 | - | - | 39,687 |
Net remeasurement of loss allowance | 86,758 | - | - | 86,758 |
New financial assets originated or purchased | ||||
and further lending | 4,716 | - | - | 4,716 |
Balance at 31 December | 131,161 | - | - | 131,161 |
Guarantees | ||||
Balance at 1 January | 43,668 | 107 | - | 43,775 |
Net remeasurement of loss allowance | (36,006) | - | - | (36,006) |
New financial assets originated or purchased | ||||
and further lending | 137 | 50 | - | 187 |
Financial assets that have been repaid or partially repaid | (298) | (107) | - | (405) |
Balance at 31 December | 7,501 | 50 | - | 7,551 |
Commitments | ||||
Balance at 1 January | 274,242 | 2,878 | - | 277,120 |
Net remeasurement of loss allowance | 6,878 | - | - | 6,878 |
New financial assets originated or purchased | ||||
and further lending | 70,320 | 3,543 | - | 73,863 |
Financial assets that have been repaid or partially repaid | (272,676) | (2,878) | - | (275,554) |
Balance at 31 December | 78,764 | 3,543 | - | 82,307 |
FIMBank Group Annual Report & Financial Statements 2023
96
2022 | ||||
Allowance for ECL | ||||
Stage 1 | Stage 2 | Stage 3 | Total | |
USD | USD | USD | USD | |
Balances with the Central Bank of Malta, treasury bills | ||||
and cash | ||||
Balance at 1 January | 119,597 | - | - | 119,597 |
Net remeasurement of loss allowance | (46,311) | - | - | (46,311) |
New financial assets originated or purchased | ||||
and further lending | 64,079 | - | - | 64,079 |
Financial assets that have been repaid or partially repaid | (19,318) | - | - | (19,318) |
Balance at 31 December | 118,047 | - | - | 118,047 |
Loans and advances to banks | ||||
Balance at 1 January | 363,708 | 22,443 | - | 386,151 |
Transfer to Stage 1 | 9 | (9) | - | - |
Net remeasurement of loss allowance | (31,409) | (4,860) | - | (36,269) |
New financial assets originated or purchased | ||||
and further lending | 343,470 | 5,483 | - | 348,953 |
Financial assets that have been repaid or partially repaid | (248,518) | (6,647) | - | (255,165) |
Foreign exchange and other movements | (1,455) | - | - | (1,455) |
Balance at 31 December | 425,805 | 16,410 | - | 442,215 |
Financial investments at fair value through other comprehensive income | ||||
Balance at 1 January | 82,065 | - | - | 82,065 |
Net remeasurement of loss allowance | 42,275 | - | - | 42,275 |
New financial assets originated or purchased | ||||
and further lending | 3,036 | - | - | 3,036 |
Financial assets that have been repaid or partially repaid | (1,799) | - | - | (1,799) |
Balance at 31 December | 125,577 | - | - | 125,577 |
Financial investments at amortised cost | ||||
Balance at 1 January | 57,622 | - | - | 57,622 |
New financial assets originated or purchased and further Lending | 39,687 | - | - | 39,687 |
Financial assets that have been repaid or partially repaid | (57,622) | - | - | (57,622) |
Balance at 31 December | 39,687 | - | - | 39,687 |
Guarantees | ||||
Balance at 1 January | 823 | - | 161,243 | 162,066 |
Net remeasurement of loss allowance | 72 | - | (158,039) | (157,967) |
New financial assets originated or purchased | ||||
and further lending | 43,399 | 107 | - | 43,506 |
Financial assets that have been repaid or partially repaid | (626) | - | - | (626) |
Foreign exchange and other movements | - | - | (3,204) | (3,204) |
Balance at 31 December | 43,668 | 107 | - | 43,775 |
Commitments | ||||
Balance at 1 January | 94,841 | 2,421 | - | 97,262 |
Net remeasurement of loss allowance | 467 | - | - | 467 |
New financial assets originated or purchased | ||||
and further lending | 270,362 | 2,878 | - | 273,240 |
Financial assets that have been repaid or partially repaid | (91,428) | (2,421) | - | (93,849) |
Balance at 31 December | 274,242 | 2,878 | - | 277,120 |
FIMBank Group Annual Report & Financial Statements 2023
97
2023 | ||||
Allowance for ECL | ||||
Stage 1 | Stage 2 | Stage 3 | Total | |
USD | USD | USD | USD | |
Balances with the Central Bank of Malta, treasury bills | ||||
and cash | ||||
Balance at 1 January | 118,047 | - | - | 118,047 |
Net remeasurement of loss allowance | (46,750) | - | - | (46,750) |
New financial assets originated or purchased | ||||
and further lending | 76,808 | - | - | 76,808 |
Financial assets that have been repaid or partially repaid | (64,079) | - | - | (64,079) |
Balance at 31 December | 84,026 | - | - | 84,026 |
Loans and advances to banks | ||||
Balance at 1 January | 406,843 | 10,928 | - | 417,771 |
Net remeasurement of loss allowance | (62,184) | (10,753) | - | (72,937) |
New financial assets originated or purchased | ||||
and further lending | 88,693 | 9,654 | - | 98,347 |
Financial assets that have been repaid or partially repaid | (227,503) | - | - | (227,503) |
Balance at 31 December | 205,849 | 9,829 | - | 215,678 |
Financial investments at fair value through other comprehensive income | ||||
Balance at 1 January | 125,577 | - | - | 125,577 |
Net remeasurement of loss allowance | (38,948) | - | - | (38,948) |
Financial assets that have been repaid or partially repaid | (3,396) | - | - | (3,396) |
Balance at 31 December | 83,233 | - | - | 83,233 |
Financial investments at amortised cost | ||||
Balance at 1 January | 39,687 | - | - | 39,687 |
Net remeasurement of loss allowance | 86,758 | - | - | 86,758 |
New financial assets originated or purchased | ||||
and further lending | 4,716 | - | - | 4,716 |
Balance at 31 December | 131,161 | - | - | 131,161 |
Guarantees | ||||
Balance at 1 January | 75,317 | 107 | - | 75,424 |
Net remeasurement of loss allowance | (36,006) | - | - | (36,006) |
New financial assets originated or purchased | ||||
and further lending | 414 | 50 | - | 464 |
Financial assets that have been repaid or partially repaid | (31,947) | (107) | - | (32,054) |
Balance at 31 December | 7,778 | 50 | - | 7,828 |
Commitments | ||||
Balance at 1 January | 42,904 | 2,881 | - | 45,785 |
Net remeasurement of loss allowance | 6,878 | - | - | 6,878 |
New financial assets originated or purchased | ||||
and further lending | 70,320 | 3,543 | - | 73,863 |
Financial assets that have been repaid or partially repaid | (41,338) | (2,881) | - | (44,219) |
Balance at 31 December | 78,764 | 3,543 | - | 82,307 |
FIMBank Group Annual Report & Financial Statements 2023
98
2022 | ||||
Allowance for ECL | ||||
Stage 1 | Stage 2 | Stage 3 | Total | |
USD | USD | USD | USD | |
Balances with the Central Bank of Malta, treasury bills | ||||
and cash | ||||
Balance at 1 January | 119,597 | - | - | 119,597 |
Net remeasurement of loss allowance | (46,311) | - | - | (46,311) |
New financial assets originated or purchased | ||||
and further lending | 64,079 | - | - | 64,079 |
Financial assets that have been repaid or partially repaid | (19,318) | - | - | (19,318) |
Balance at 31 December | 118,047 | - | - | 118,047 |
Loans and advances to banks | ||||
Balance at 1 January | 345,928 | 22,435 | - | 368,363 |
Net remeasurement of loss allowance | (28,640) | (4,860) | - | (33,500) |
New financial assets originated or purchased | ||||
and further lending | 336,589 | - | - | 336,589 |
Financial assets that have been repaid or partially repaid | (247,034) | (6,647) | - | (253,681) |
Balance at 31 December | 406,843 | 10,928 | - | 417,771 |
Financial investments at fair value through other comprehensive income | ||||
Balance at 1 January | 82,065 | - | - | 82,065 |
Net remeasurement of loss allowance | 42,275 | - | - | 42,275 |
New financial assets originated or purchased | ||||
and further lending | 3,036 | - | - | 3,036 |
Financial assets that have been repaid or partially repaid | (1,799) | - | - | (1,799) |
Balance at 31 December | 125,577 | - | - | 125,577 |
Financial investments at amortised cost | ||||
Balance at 1 January | 57,622 | - | - | 57,622 |
New financial assets originated or purchased | ||||
and further lending | 39,687 | - | - | 39,687 |
Financial assets that have been repaid or partially repaid | (57,622) | - | - | (57,622) |
Balance at 31 December | 39,687 | - | - | 39,687 |
Guarantees | ||||
Balance at 1 January | 752 | - | 161,243 | 161,995 |
Net remeasurement of loss allowance | 74 | - | (158,039) | (157,965) |
New financial assets originated or purchased | ||||
and further lending | 75,045 | 107 | - | 75,152 |
Financial assets that have been repaid or partially repaid | (554) | - | - | (554) |
Foreign exchange and other movements | - | - | (3,204) | (3,204) |
Balance at 31 December | 75,317 | 107 | - | 75,424 |
Commitments | ||||
Balance at 1 January | 37,358 | 2,422 | - | 39,780 |
Net remeasurement of loss allowance | 467 | - | - | 467 |
New financial assets originated or purchased | ||||
and further lending | 39,027 | 2,878 | - | 41,905 |
Financial assets that have been repaid or partially repaid | (33,948) | (2,419) | - | (36,367) |
Balance at 31 December | 42,904 | 2,881 | - | 45,785 |
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Financial | ||||||||
Balances with | investments | |||||||
the Central | at fair value | |||||||
Bank of Malta, | Loans and | Loans and | through other | Financial | ||||
treasury bills | advances | advances | comprehensive | investments at | ||||
and cash | to banks | to customers | income | amortised cost | Guarantees | Commitments | Total | |
USD | USD | USD | USD | USD | USD | USD | USD | |
Net remeasurement of loss allowance | (46,750) | (68,135) | 1,086,842 | (38,948) | 86,758 | (36,006) | 6,878 | 990,639 |
New financial assets originated or purchased and further lending | 76,808 | 103,498 | 1,736,433 | - | 4,716 | 187 | 73,863 | 1,995,505 |
Financial assets that have been repaid or partially repaid | (64,079) | (237,899) | (3,356,786) | (3,396) | - | (405) | (275,554) | (3,938,119) |
Write-offs | - | - | 3,552,258 | - | - | - | - | 3,552,258 |
Total | (34,021) | (202,536) | 3,018,747 | (42,344) | 91,474 | (36,224) | (194,813) | 2,600,283 |
Recoveries of amounts previously written off | - | - | (639,395) | - | - | - | - | (639,395) |
Total | (34,021) | (202,536) | 2,379,352 | (42,344) | 91,474 | (36,224) | (194,813) | 1,960,888 |
Financial | ||||||||
Balances with | investments | |||||||
the Central | at fair value | |||||||
Bank of Malta, | Loans and | Loans and | through other | Financial | ||||
treasury bills | advances | advances | comprehensive | investments at | ||||
and cash | to banks | to customers | income | amortised cost | Guarantees | Commitments | Total | |
USD | USD | USD | USD | USD | USD | USD | USD | |
Net remeasurement of loss allowance | (46,311) | (36,269) | 2,174,272 | 42,275 | - | (157,967) | 467 | 1,976,467 |
New financial assets originated or purchased and further lending | 64,079 | 348,953 | 1,560,719 | 3,036 | 39,687 | 43,506 | 273,240 | 2,333,220 |
Financial assets that have been repaid or partially repaid | (19,318) | (255,165) | (1,558,276) | (1,799) | (57,622) | (626) | (93,849) | (1,986,655) |
Write-offs | - | - | 19,299,868 | - | - | - | - | 19,299,868 |
Total | (1,550) | 57,519 | 21,476,583 | 43,512 | (17,935) | (115,087) | 179,858 | 21,622,900 |
Recoveries of amounts previously written off | - | - | (1,594,216) | - | - | - | - | (1,594,216) |
Total | (1,550) | 57,519 | 19,882,367 | 43,512 | (17,935) | (115,087) | 179,858 | 20,028,684 |
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Financial | ||||||||
Balances with | investments | |||||||
the Central | at fair value | |||||||
Bank of Malta, | Loans and | Loans and | through other | Financial | ||||
treasury bills | advances | advances | comprehensive | investments at | ||||
and cash | to banks | to customers | income | amortised cost | Guarantees | Commitments | Total | |
USD | USD | USD | USD | USD | USD | USD | USD | |
Net remeasurement of loss allowance | (46,750) | (72,937) | 898,008 | (38,948) | 86,758 | (36,006) | 6,878 | 797,003 |
New financial assets originated or purchased and further lending | 76,808 | 98,347 | 1,421,673 | - | 4,716 | 464 | 73,863 | 1,675,871 |
Financial assets that have been repaid or partially repaid | (64,079) | (227,503) | (2,558,202) | (3,396) | - | (32,054) | (44,219) | (2,929,453) |
Write-offs | - | - | 3,552,257 | - | - | - | - | 3,552,257 |
Total | (34,021) | (202,093) | 3,313,736 | (42,344) | 91,474 | (67,596) | 36,522 | 3,095,678 |
Recoveries of amounts previously written off | - | - | (102,086) | - | - | - | - | (102,086) |
Total | (34,021) | (202,093) | 3,211,650 | (42,344) | 91,474 | (67,596) | 36,522 | 2,993,592 |
Financial | ||||||||
Balances with | investments | |||||||
the Central | at fair value | |||||||
Bank of Malta, | Loans and | Loans and | through other | Financial | ||||
treasury bills | advances | advances | comprehensive | investments at | ||||
and cash | to banks | to customers | income | amortised cost | Guarantees | Commitments | Total | |
USD | USD | USD | USD | USD | USD | USD | USD | |
Net remeasurement of loss allowance | (46,311) | (33,500) | 826,190 | 42,275 | - | (157,965) | 467 | 631,156 |
New financial assets originated or purchased and further lending | 64,079 | 336,589 | 896,045 | 3,036 | 39,687 | 75,152 | 41,905 | 1,456,493 |
Financial assets that have been repaid or partially repaid | (19,318) | (253,681) | (527,180) | (1,799) | (57,622) | (554) | (36,367) | (896,521) |
Write-offs | - | - | 16,741,134 | - | - | - | - | 16,741,134 |
Total | (1,550) | 49,408 | 17,936,189 | 43,512 | (17,935) | (83,367) | 6,005 | 17,932,262 |
Recoveries of amounts previously written off | - | - | (508,161) | - | - | - | - | (508,161) |
Total | (1,550) | 49,408 | 17,428,028 | 43,512 | (17,935) | (83,367) | 6,005 | 17,424,101 |
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FIMBank Group Annual Report & Financial Statements 2023 102 | |||
Group – 31 December 2022 | |||
2022 | |||
Stage 2 | Stage 3 | Total | |
USD | USD | USD | |
At 1 January | 4,330,159 | 15,837,294 | 20,167,453 |
Additions | - | 1,761,231 | 1,761,231 |
Recovered | (4,073,840) | (4,134,796) | (8,208,636) |
Written off | - | (1,295,418) | (1,295,418) |
Reclassified | 17,628 | (17,628) | - |
At 31 December | 273,947 | 12,150,683 | 12,424,630 |
Loss allowances | - | (7,249,935) | (7,249,935) |
Bank – 31 December 2023 | |||
2023 | |||
Stage 2 | Stage 3 | Total | |
USD | USD | USD | |
At 1 January | 273,947 | 9,973,632 | 10,247,579 |
Additions | 7,855,466 | 2,325 | 7,857,791 |
Recovered | (17,628) | (976,829) | (994,457) |
Written off | - | (118,777) | (118,777) |
Reclassified | - | - | - |
At 31 December | 8,111,785 | 8,880,351 | 16,992,136 |
Loss allowances | - | (5,673,547) | (5,673,547) |
Bank – 31 December 2022 | |||
2022 | |||
Stage 2 | Stage 3 | Total | |
USD | USD | USD | |
At 1 January | 1,948,525 | 13,569,272 | 15,517,797 |
Additions | - | 12,328 | 12,328 |
Recovered | (1,692,206) | (2,294,922) | (3,987,128) |
Written off | - | (1,295,418) | (1,295,418) |
Reclassified | 17,628 | (17,628) | - |
At 31 December | 273,947 | 9,973,632 | 10,247,579 |
Loss allowances | - | (6,120,653) | (6,120,653) |
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Year-on-year change | ||||||
Country: Germany | 2024 | 2025 | 2026 | 2027 | 2028 | |
Equity | Base | 8% | 2% | 3% | 3% | 2% |
Upside | 15% | 6% | 4% | 2% | 1% | |
Downside | -29% | 29% | 14% | 5% | 2% | |
GDP growth | Base | 1% | 2% | 2% | 1% | 1% |
Upside | 3% | 2% | 2% | 1% | 1% | |
Downside | -5% | 2% | 3% | 2% | 1% | |
Unemployment | Base | 0% | -3% | -2% | -2% | -2% |
Upside | -8% | -2% | 1% | 0% | -1% | |
Downside | 18% | 3% | -11% | -8% | -4% | |
Country: Malta | 2024 | 2025 | 2026 | 2027 | 2028 | |
Equity | Base | 9% | 12% | 13% | 11% | 8% |
Upside | 22% | 9% | 12% | 9% | 7% | |
Downside | -22% | 31% | 26% | 13% | 9% | |
GDP growth | Base | 4% | 4% | 3% | 3% | 3% |
Upside | 7% | 4% | 3% | 3% | 3% | |
Downside | -3% | 5% | 4% | 3% | 3% | |
Unemployment | Base | 25% | -1% | -4% | 0% | 0% |
Upside | 24% | -3% | -4% | 0% | 0% | |
Downside | 40% | 1% | -13% | 0% | 1% | |
Country: India | 2024 | 2025 | 2026 | 2027 | 2028 | |
Equity | Base | 11% | 7% | 7% | 8% | 7% |
Upside | 19% | 6% | 8% | 6% | 6% | |
Downside | -26% | 22% | 19% | 12% | 6% | |
GDP growth | Base | 7% | 6% | 6% | 6% | 6% |
Upside | 9% | 7% | 7% | 6% | 6% | |
Downside | -2% | 5% | 7% | 7% | 7% | |
Unemployment | Base | 1% | 0% | -1% | -1% | -1% |
Upside | -4% | 0% | 1% | 0% | 0% | |
Downside | 34% | 5% | -15% | -11% | -5% | |
FX | Base | -1% | 1% | 0% | 0% | 1% |
Upside | -3% | 1% | 0% | 0% | 1% | |
Downside | 4% | 1% | 0% | 0% | 1% | |
Country: Egypt | 2024 | 2025 | 2026 | 2027 | 2028 | |
Equity | Base | 14% | 6% | 6% | 4% | 3% |
Upside | 30% | 3% | 4% | 1% | 2% | |
Downside | -34% | 33% | 24% | 11% | 4% | |
GDP growth | Base | 4% | 6% | 5% | 5% | 5% |
Upside | 7% | 6% | 5% | 5% | 5% | |
Downside | -1% | 6% | 6% | 6% | 5% | |
Unemployment | Base | 3% | 0% | 2% | 2% | 1% |
Upside | -3% | 1% | 5% | 4% | 1% | |
Downside | 29% | -3% | -6% | -4% | -2% | |
Country: Italy | 2024 | 2025 | 2026 | 2027 | 2028 | |
Equity | Base | 8% | 9% | 11% | 6% | 4% |
Upside | 17% | 9% | 9% | 4% | 4% | |
Downside | -28% | 30% | 23% | 9% | 4% | |
Unemployment | Base | 3% | 3% | 1% | 0% | 0% |
Upside | 0% | 2% | 2% | 1% | 1% | |
Downside | 35% | 4% | -6% | -5% | -3% | |
Eurozone GDP | Base | 1% | 2% | 2% | 2% | 1% |
Upside | 3% | 2% | 2% | 2% | 1% | |
Downside | -5% | 2% | 3% | 2% | 1% |
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Year-on-year change | ||||||
Country: Malta | 2023 | 2024 | 2025 | 2026 | 2027 | |
Equity | Base | 1% | 8% | 10% | 9% | 7% |
Upside | 14% | 4% | 8% | 7% | 6% | |
Downside | -28% | 26% | 24% | 12% | 7% | |
GDP growth | Base | 7% | 1% | 4% | 3% | 2% |
Upside | 9% | 1% | 4% | 3% | 2% | |
Downside | 1% | 1% | 5% | 3% | 2% | |
Unemployment | Base | 12% | 3% | 2% | 1% | 1% |
Upside | 11% | 1% | 3% | 2% | 2% | |
Downside | 24% | 15% | -1% | -3% | -3% | |
Country: Germany | 2023 | 2024 | 2025 | 2026 | 2027 | |
Equity | Base | 5% | -2% | 4% | 4% | 3% |
Upside | 10% | 2% | 4% | 3% | 2% | |
Downside | -31% | 23% | 15% | 6% | 2% | |
GDP growth | Base | 1% | 4% | 3% | 2% | 1% |
Upside | 3% | 4% | 3% | 2% | 1% | |
Downside | -5% | 5% | 4% | 2% | 1% | |
Unemployment | Base | 3% | -3% | -2% | -1% | 0% |
Upside | -6% | -7% | 1% | 2% | 1% | |
Downside | 35% | 0% | -9% | -6% | -5% | |
Country: India | 2023 | 2024 | 2025 | 2026 | 2027 | |
Equity | Base | 6% | 4% | 4% | 2% | 2% |
Upside | 13% | 3% | 4% | 1% | 3% | |
Downside | -16% | 12% | 8% | 4% | 3% | |
GDP growth | Base | 5% | 7% | 6% | 5% | 5% |
Upside | 7% | 8% | 7% | 5% | 5% | |
Downside | -3% | 7% | 6% | 4% | 5% | |
Unemployment | Base | 5% | -1% | 0% | 0% | 0% |
Upside | 2% | -1% | 0% | 0% | 0% | |
Downside | 12% | -2% | -2% | -2% | -1% | |
FX | Base | 2% | 1% | 1% | 1% | 1% |
Upside | 1% | 2% | 1% | 1% | 1% | |
Downside | 6% | -1% | 0% | 1% | 1% | |
Country: United Arab Emirates | 2023 | 2024 | 2025 | 2026 | 2027 | |
Equity | Base | -2% | -1% | 1% | 0% | 1% |
Upside | 4% | -3% | 0% | 0% | 1% | |
Downside | -20% | 8% | 4% | 2% | 1% | |
Unemployment | Base | -7% | -10% | -4% | -1% | -1% |
Upside | -29% | 1% | 12% | -1% | -1% | |
Downside | 21% | -20% | -9% | -6% | -3% | |
Oil price | Base | -11% | -15% | -1% | 1% | 1% |
Upside | -9% | -17% | -2% | 1% | 1% | |
Downside | -34% | -3% | 13% | 1% | 2% | |
Country: Egypt | 2023 | 2024 | 2025 | 2026 | 2027 | |
Equity | Base | 32% | 3% | 3% | 3% | 2% |
Upside | 50% | -2% | 0% | 1% | 2% | |
Downside | -16% | 30% | 17% | 3% | 2% | |
GDP growth | Base | 6% | 5% | 5% | 5% | 5% |
Upside | 8% | 5% | 5% | 5% | 5% | |
Downside | 1% | 5% | 6% | 6% | 5% | |
Unemployment | Base | -1% | 1% | 2% | 2% | 1% |
Upside | -5% | 2% | 4% | 2% | 1% | |
Downside | -5% | 2% | 3% | 2% | 1% |
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2023 | ||||
Upside | Base Case | Downside | Probability- | |
weighted | ||||
USD | USD | USD | USD | |
Loans and advances to customers | ||||
Gross exposure | 450,255,367 | 450,255,367 | 450,255,367 | 450,255,367 |
Loss allowance | 16,996,812 | 17,728,585 | 21,341,671 | 18,913,293 |
2022 | ||||
Upside | Base Case | Downside | Probability- | |
weighted | ||||
USD | USD | USD | USD | |
Loans and advances to customers | ||||
Gross exposure | 559,604,964 | 559,604,964 | 559,604,964 | 559,604,964 |
Loss allowance | 74,945,575 | 75,368,976 | 76,983,861 | 75,076,907 |
2023 | ||||
Upside | Base Case | Downside | Probability- | |
weighted | ||||
USD | USD | USD | USD | |
Loans and advances to customers | ||||
Gross exposure | 630,905,238 | 630,905,238 | 630,905,238 | 630,905,238 |
Loss allowance | 9,477,335 | 10,049,349 | 13,187,940 | 12,787,013 |
2022 | ||||
Upside | Base Case | Downside | Probability- | |
weighted | ||||
USD | USD | USD | USD | |
Loans and advances to customers | ||||
Gross exposure | 787,271,344 | 787,271,344 | 787,271,344 | 787,271,344 |
Loss allowance | 68,027,484 | 68,291,356 | 69,406,260 | 68,360,917 |
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Gross carrying | Shipping | Insurance | Total | Net uncovered | ||||
amount | Cash | Property | Guarantees | mortgages | cover | collateral | amount | |
Loans and advances to customers | USD | USD | USD | USD | USD | USD | USD | USD |
Stage 1 | 332,452,354 | 11,078,422 | 76,874,414 | 19,260,275 | 14,900,000 | 37,136,509 | 159,249,620 | 173,202,734 |
Stage 2 | 124,620,784 | 41,029,795 | 420,464 | 4,740,753 | - | 284,328 | 46,475,340 | 78,145,444 |
Stage 3 | 102,531,826 | 3,160,557 | - | - | - | 11,475,283 | 14,635,840 | 87,895,986 |
559,604,964 | 55,268,774 | 77,294,878 | 24,001,028 | 14,900,000 | 48,896,120 | 220,360,800 | 339,244,164 | |
Commitments | ||||||||
Stage 1 | 85,964,984 | 1,398,578 | 52,773,508 | 10,631,703 | - | - | 64,803,789 | 21,161,195 |
Stage 2 | 14,036,479 | 13,356,805 | - | - | - | - | 13,356,805 | 679,674 |
Stage 3 | - | - | - | - | - | - | - | - |
Guarantees | 100,001,463 | 14,755,383 | 52,773,508 | 10,631,703 | - | - | 78,160,594 | 21,840,869 |
Stage 1 | 11,877,891 | 4,215,057 | - | - | - | - | 4,215,057 | 7,662,834 |
Stage 2 | 89,974 | 57,455 | - | - | - | - | 57,455 | 32,519 |
Stage 3 | 166,577 | - | - | - | - | - | - | 166,577 |
12,134,442 | 4,272,512 | - | - | - | - | 4,272,512 | 7,861,930 |
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Gross carrying | Shipping | Insurance | Total | Net uncovered | ||||
amount | Cash | Property | Guarantees | mortgages | cover | collateral | amount | |
Loans and advances to customers | USD | USD | USD | USD | USD | USD | USD | USD |
Stage 1 | 574,232,438 | 26,402,184 | 69,988,324 | 24,727,608 | 29,500,000 | 13,537,521 | 164,155,637 | 410,076,801 |
Stage 2 | 36,066,877 | 4,368,835 | 8,784,388 | 563,079 | - | 2,925 | 13,719,227 | 22,347,650 |
Stage 3 | 20,605,923 | 1,155,046 | 3,119,493 | - | - | - | 4,274,539 | 16,331,384 |
630,905,238 | 31,926,065 | 81,892,205 | 25,290,687 | 29,500,000 | 13,540,446 | 182,149,403 | 448,755,835 | |
Commitments | ||||||||
Stage 1 | 87,694,011 | 2,028,970 | 59,157,272 | 17,558,372 | - | - | 78,744,614 | 8,949,397 |
Stage 2 | 12,526,076 | 7,406,256 | 2,892,495 | - | - | - | 10,298,751 | 2,227,325 |
Stage 3 | - | - | - | - | - | - | - | - |
Guarantees | 100,220,087 | 9,435,226 | 62,049,767 | 17,558,372 | - | - | 89,043,365 | 11,176,722 |
Stage 1 | 39,044,929 | 10,397,443 | - | - | - | - | 10,397,443 | 28,647,486 |
Stage 2 | 30,069 | - | - | - | - | - | - | 30,069 |
Stage 3 | - | - | - | - | - | - | - | - |
39,074,998 | 10,397,443 | - | - | - | - | 10,397,443 | 28,677,555 |
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Gross carrying | Shipping | Insurance | Total | Net uncovered | ||||
amount | Cash | Property | Guarantees | mortgages | cover | collateral | amount | |
Loans and advances to customers | USD | USD | USD | USD | USD | USD | USD | USD |
Stage 1 | 620,988,500 | 11,078,422 | 76,874,414 | 19,040,859 | 14,900,000 | 37,136,509 | 159,030,204 | 461,958,296 |
Stage 2 | 72,447,468 | 41,029,795 | 420,464 | 4,740,750 | - | 284,328 | 46,475,337 | 25,972,131 |
Stage 3 | 93,835,376 | 3,160,557 | - | - | - | 11,475,283 | 14,635,840 | 79,199,536 |
787,271,344 | 55,268,774 | 77,294,878 | 23,781,609 | 14,900,000 | 48,896,120 | 220,141,381 | 567,129,963 | |
Commitments | ||||||||
Stage 1 | 77,377,944 | 1,398,578 | 52,773,508 | 10,631,703 | - | - | 64,803,789 | 12,574,155 |
Stage 2 | 14,036,479 | 13,356,805 | - | - | - | - | 13,356,805 | 679,674 |
Stage 3 | - | - | - | - | - | - | - | - |
Guarantees | 91,414,423 | 14,755,383 | 52,773,508 | 10,631,703 | - | - | 78,160,594 | 13,253,829 |
Stage 1 | 35,875,332 | 4,208,195 | - | - | - | - | 4,208,195 | 31,667,136 |
Stage 2 | 89,974 | 57,455 | - | - | - | - | 57,455 | 32,519 |
Stage 3 | 166,577 | - | - | - | - | - | - | 166,577 |
36,131,883 | 4,265,650 | - | - | - | - | 4,265,650 | 31,866,232 |
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Group | Bank | ||||
2023 | 2022 | 2023 | 2022 | ||
USD | USD | USD | USD | ||
Balances with the Central Bank of Malta, | treasury bills and cash | ||||
– | Europe | 353,010,186 | 216,867,325 | 352,997,057 | 216,852,467 |
353,010,186 | 216,867,325 | 352,997,057 | 216,852,467 | ||
Trading assets | |||||
– | Europe | 31,828,756 | 82,233,407 | - | - |
– | Sub-Saharan Africa | 139,775,814 | 147,323,290 | - | - |
– | Middle East and North Africa (MENA) | 110,850,563 | 98,619,466 | - | - |
– | Commonwealth of Independent States (CIS) region | 16,246,223 | 5,099,800 | - | - |
– | Others | 75,475,752 | 111,307,698 | - | - |
374,177,108 | 444,583,661 | - | - | ||
Loans and advances to banks | |||||
– | Europe | 34,656,678 | 99,536,057 | 33,749,056 | 99,026,856 |
– | Sub-Saharan Africa | 45,171,224 | 5,106,346 | 45,171,224 | 5,106,346 |
– | Commonwealth of Independent States (CIS) region | 19,113,436 | 30,648,535 | 11,463,939 | 18,370,349 |
– | Middle East and North Africa (MENA) | 330,624 | 994,656 | 330,624 | 970,605 |
– | Others | 53,542,986 | 13,428,332 | 23,610,400 | 2,408,276 |
152,814,948 | 149,713,926 | 114,325,243 | 125,882,432 | ||
Loans and advances to customers | |||||
– | Europe | 155,078,652 | 174,266,901 | 370,179,082 | 427,705,590 |
– | Sub-Saharan Africa | 52,698,508 | 16,747,725 | 51,842,806 | 15,592,890 |
– | Middle East and North Africa (MENA) | 133,279,528 | 200,960,130 | 101,208,100 | 184,557,632 |
– | Others | 90,285,386 | 92,553,301 | 94,888,237 | 91,054,315 |
431,342,074 | 484,528,057 | 618,118,225 | 718,910,427 | ||
Financial investments at fair value through profit or loss | |||||
– | Europe | 18,688,853 | 17,426,377 | 18,688,853 | 17,426,377 |
– | Middle East and North Africa (MENA) | 640,987 | 752,843 | 640,987 | 752,843 |
Financial investments at fair value through other | comprehensive income | 19,329,840 | 18,179,220 | 19,329,840 | 18,179,220 |
– | Europe | 140,755,780 | 143,189,022 | 140,755,780 | 143,189,022 |
140,755,780 | 143,189,022 | 140,755,780 | 143,189,022 | ||
Financial investments at amortised cost | |||||
– | Europe | 18,754,079 | 4,834,729 | 18,754,079 | 4,834,729 |
– | Middle East and North Africa (MENA) | 9,644,994 | 9,767,279 | 9,644,994 | 9,767,279 |
28,399,073 | 14,602,008 | 28,399,073 | 14,602,008 | ||
Guarantees | |||||
– | Europe | 27,605,515 | 11,522,050 | 38,655,239 | 35,519,491 |
– | Middle East and North Africa (MENA) | 419,759 | 612,392 | 419,759 | 612,392 |
28,025,274 | 12,134,442 | 39,074,998 | 36,131,883 | ||
Commitments | |||||
– | Europe | 72,422,491 | 59,212,388 | 72,422,491 | 59,765,103 |
– | Sub-Saharan Africa | 39,544,662 | 24,524,102 | 9,759,120 | 18,124,563 |
– | Middle East and North Africa (MENA) | 22,752,586 | 13,524,757 | 17,752,586 | 13,524,757 |
– | Others | 13,083,968 | 2,740,216 | 285,890 | - |
147,803,707 | 100,001,463 | 100,220,087 | 91,414,423 | ||
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Group | Bank | ||||
2023 | 2022 | 2023 | 2022 | ||
USD | USD | USD | USD | ||
Balances with the Central Bank of Malta, treasury bills and cash | |||||
– | Financial intermediation | 221,758,441 | 91,488,249 | 221,745,312 | 91,473,391 |
– | Public administration | 131,251,745 | 125,379,076 | 131,251,745 | 125,379,076 |
353,010,186 | 216,867,325 | 352,997,057 | 216,852,467 | ||
Trading assets | |||||
– | Industrial raw materials | 37,734,232 | 51,798,300 | - | - |
– | Shipping and transportation | 351,497 | 5,600,957 | - | - |
– | Wholesale and retail trade | 16,995,057 | 35,115,323 | - | - |
– | Financial intermediation | 239,193,354 | 248,681,065 | - | - |
– | Public administration | 68,654,187 | 67,809,494 | - | - |
– | Other services | 11,248,781 | 35,578,522 | - | - |
374,177,108 | 444,583,661 | - | - | ||
Loans and advances to banks | |||||
– | Financial intermediation | 152,814,948 | 149,713,926 | 114,325,243 | 125,882,432 |
152,814,948 | 149,713,926 | 114,325,243 | 125,882,432 | ||
Loans and advances to customers | |||||
– | Industrial raw materials | 183,171,375 | 172,578,767 | 55,658,839 | 72,815,848 |
– | Shipping and transportation | 966,513 | 2,031,586 | 673,989 | - |
– | Wholesale and retail trade | 127,745,154 | 130,462,081 | 95,547,769 | 91,712,231 |
– | Financial intermediation | 52,927,880 | 52,683,256 | 383,386,425 | 412,921,413 |
– | Real estate activities | 46,908,035 | 53,353,107 | 77,308,258 | 79,530,116 |
– | Other services | 19,623,117 | 73,419,260 | 5,542,945 | 61,930,819 |
431,342,074 | 484,528,057 | 618,118,225 | 718,910,427 | ||
Financial investments at fair value through profit or loss | |||||
– | Financial intermediation | 19,277,483 | 18,126,144 | 19,277,483 | 18,126,144 |
– | Other services | 52,357 | 53,076 | 52,357 | 53,076 |
19,329,840 | 18,179,220 | 19,329,840 | 18,179,220 | ||
Financial investments at fair value through other comprehensive income | |||||
– | Shipping and transportation | 5,304,461 | 9,849,204 | 5,304,461 | 9,849,204 |
– | Financial intermediation | 39,578,149 | 46,564,488 | 39,578,149 | 46,564,488 |
– | Public administration | 95,873,170 | 86,775,330 | 95,873,170 | 86,775,330 |
140,755,780 | 143,189,022 | 140,755,780 | 143,189,022 | ||
Financial investments at amortised cost | |||||
– | Financial intermediation | 17,060,289 | 14,602,008 | 17,060,289 | 14,602,008 |
– | Public administration | 11,338,784 | - | 11,338,784 | - |
28,399,073 | 14,602,008 | 28,399,073 | 14,602,008 | ||
Guarantees | |||||
– | Industrial raw materials | 8,129,749 | 2,302,822 | 8,129,749 | 2,302,822 |
– | Shipping and transportation | - | 180,000 | - | 180,000 |
– | Wholesale and retail trade | 368,564 | 368,564 | 368,564 | 368,564 |
– | Financial intermediation | 16,155,043 | 5,841,433 | 27,204,767 | 29,845,736 |
– | Real estate activities | 3,351,702 | 3,203,281 | 3,351,702 | 3,203,281 |
– | Other services | 20,216 | 238,342 | 20,216 | 231,480 |
28,025,274 | 12,134,442 | 39,074,998 | 36,131,883 | ||
Commitments | |||||
– | Industrial raw materials | 39,245,995 | 27,960,496 | 28,382,235 | 27,960,496 |
– | Wholesale and retail trade | 20,733,217 | 1,476,405 | 20,733,217 | 1,476,405 |
– | Financial intermediation | 53,686,665 | 29,028,954 | 16,966,805 | 26,841,454 |
– | Real estate activities | 27,988,824 | 34,682,412 | 27,988,824 | 34,682,412 |
– | Public administration | - | 6,399,540 | - | - |
– | Other services | 6,149,006 | 453,656 | 6,149,006 | 453,656 |
147,803,707 | 100,001,463 | 100,220,087 | 91,414,423 | ||
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FIMBank Group Annual Report & Financial Statements 2023
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FIMBank Group Annual Report & Financial Statements 2023
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FIMBank Group Annual Report & Financial Statements 2023
119
Gross nominal | Between 6 | ||||||||
Carrying | inflow/ | Less than | Between 1 | Between 3 | months | Between 1 | More than | ||
amount | (outflow) | 1 month | & 3 months | & 6 months | & 1 year | & 2 years | 2 years | No maturity | |
USD | USD | USD | USD | USD | USD | USD | USD | USD | |
Assets | |||||||||
Balances with the Central Bank of Malta, treasury bills and cash | 353,010,186 | 353,071,229 | 232,384,310 | 63,022,868 | 33,015,391 | 16,239,560 | - | - | 8,409,100 |
Trading assets | 374,177,108 | 410,280,357 | 11,529,342 | 60,824,498 | 110,472,027 | 110,387,195 | 48,355,640 | 68,711,655 | - |
Derivative assets held for risk | |||||||||
management | 715,713 | 715,713 | 603,886 | 99,879 | - | 11,948 | - | - | - |
Loans and advances to banks | 152,814,948 | 153,994,103 | 96,007,756 | 38,126,895 | 7,883,657 | 2,721,814 | - | 9,253,981 | - |
Loans and advances to customers | 431,342,074 | 458,572,278 | 126,252,520 | 71,866,719 | 83,430,623 | 82,730,854 | 20,542,787 | 73,748,775 | - |
Financial investments at fair value through profit or loss | 19,329,840 | 19,329,840 | - | - | - | - | - | - | 19,329,840 |
Financial investments at fair value through OCI | 140,755,780 | 147,651,397 | 5,103,566 | - | - | 12,903,183 | 28,142,988 | 101,501,660 | - |
Financial investments at amortised cost | 28,399,073 | 32,497,878 | - | 2,458,798 | 5,653,384 | 9,513,458 | 3,505,613 | 11,366,625 | - |
Total assets | 1,500,544,722 | 1,576,112,795 | 471,881,380 | 236,399,657 | 240,455,082 | 234,508,012 | 100,547,028 | 264,582,696 | 27,738,940 |
Liabilities | |||||||||
Derivative liabilities held for risk | |||||||||
management | (626,476) | (626,476) | (455,055) | (86,901) | - | (84,520) | - | - | - |
Amounts owed to institutions | |||||||||
and banks | (412,570,931) | (415,245,710) | (275,542,230) | (88,401,569) | (33,298,863) | (9,371,546) | - | (8,631,502) | - |
Amounts owed to customers | (934,738,942) | (942,582,357) | (455,267,877) | (189,778,254) | (155,205,077) | (131,534,323) | (3,065,975) | (7,730,851) | - |
Debt securities in issue | (27,543,864) | (27,940,439) | (5,524,862) | (11,049,724) | (11,365,853) | - | - | - | - |
Other liabilities | (2,118,563) | (2,195,987) | (36,292) | (149,146) | (259,972) | (438,056) | (631,150) | (681,371) | - |
Total liabilities | (1,377,598,776) | (1,388,590,969) | (736,826,316) | (289,465,594) | (200,129,765) | (141,428,445) | (3,697,125) | (17,043,724) | - |
Liquidity gap | (264,944,936) | (53,065,937) | 40,325,317 | 93,079,567 | 96,849,903 | 247,538,972 | |||
Cumulative liquidity gap | (264,944,936) | (318,010,873) | (277,685,556) | (184,605,989) | (87,756,086) | 159,782,886 |
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Gross nominal | Between 6 | ||||||||
Carrying | inflow/ | Less than | Between 1 | Between 3 | months | Between 1 | More than | ||
amount | (outflow) | 1 month | & 3 months | & 6 months | & 1 year | & 2 years | 2 years | No maturity | |
USD | USD | USD | USD | USD | USD | USD | USD | USD | |
Assets | |||||||||
Balances with the Central Bank of Malta, treasury bills and cash | 216,867,325 | 216,861,803 | 108,822,568 | 63,592,889 | 22,168,959 | 10,614,721 | - | - | 11,662,666 |
Trading assets | 444,583,661 | 469,233,392 | 28,003,387 | 72,891,424 | 151,358,755 | 131,317,048 | 62,839,537 | 22,823,241 | - |
Derivative assets held for risk | |||||||||
management | 1,610,475 | 1,610,475 | 862,905 | 390,260 | 303,465 | 53,845 | - | - | - |
Loans and advances to banks | 149,713,926 | 151,314,871 | 80,502,652 | 48,263,070 | 920,536 | 11,784,675 | 970,605 | 8,873,333 | - |
Loans and advances to customers | 484,528,057 | 507,794,578 | 214,092,284 | 46,103,882 | 58,056,341 | 108,967,963 | 26,979,078 | 53,595,030 | - |
Financial investments at fair value through profit or loss | 18,179,220 | 18,179,220 | - | - | - | - | - | - | 18,179,220 |
Financial investments at fair value through OCI | 143,189,022 | 150,817,443 | - | 6,676,935 | 7,063,964 | - | 17,855,201 | 119,221,343 | - |
Financial investments at amortised cost | 14,602,008 | 18,492,458 | - | - | 320,964 | 641,927 | 6,143,361 | 11,386,206 | - |
Total assets | 1,473,273,694 | 1,534,304,240 | 432,283,796 | 237,918,460 | 240,192,984 | 263,380,179 | 114,787,782 | 215,899,153 | 29,841,886 |
Liabilities | |||||||||
Derivative liabilities held for risk | |||||||||
management | (578,779) | (578,779) | (136,858) | (55,634) | (293,218) | (93,069) | - | - | - |
Amounts owed to institutions | |||||||||
and banks | (473,295,256) | (476,046,125) | (301,209,084) | (66,349,306) | (34,049,116) | (44,745,856) | (21,061,410) | (8,631,353) | - |
Amounts owed to customers | (876,187,765) | (879,068,723) | (463,010,495) | (185,413,108) | (80,572,219) | (138,390,126) | (10,512,968) | (1,169,807) | - |
Debt securities in issue | (15,451,068) | (15,568,873) | - | (15,568,873) | - | - | - | - | - |
Other liabilities | (2,704,717) | (3,042,967) | (12,927) | (110,642) | (216,219) | (475,271) | (866,614) | (1,361,294) | - |
Total liabilities | (1,368,217,585) | (1,374,305,467) | (764,369,364) | (267,497,563) | (115,130,772) | (183,704,322) | (32,440,992) | (11,162,454) | - |
Liquidity gap | (332,085,568) | (29,579,103) | 125,062,212 | 79,675,857 | 82,346,790 | 204,736,699 | |||
Cumulative liquidity gap | (332,085,568) | (361,664,671) | (236,602,459) | (156,926,602) | (74,579,812) | 130,156,887 |
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Gross nominal | Between 6 | ||||||||
Carrying | inflow/ | Less than | Between 1 | Between 3 | months | Between 1 | More than | ||
amount | (outflow) | 1 month | & 3 months | & 6 months | & 1 year | & 2 years | 2 years | No maturity | |
USD | USD | USD | USD | USD | USD | USD | USD | USD | |
Assets | |||||||||
Balances with the Central Bank of Malta, treasury bills and cash | 352,997,057 | 353,058,099 | 232,384,309 | 63,022,868 | 33,015,391 | 16,239,560 | - | - | 8,395,971 |
Derivative assets held for risk | |||||||||
management | 812,609 | 812,609 | 700,782 | 99,879 | - | 11,948 | - | - | - |
Loans and advances to banks | 114,325,243 | 115,441,453 | 58,455,595 | 38,126,895 | 7,875,752 | 1,729,230 | - | 9,253,981 | - |
Loans and advances to customers | 618,118,225 | 648,124,541 | 116,830,361 | 102,597,981 | 256,609,008 | 78,137,786 | 20,542,787 | 73,406,618 | - |
Financial investments at fair value through profit or loss | 19,329,840 | 19,329,840 | - | - | - | - | - | - | 19,329,840 |
Financial investments at fair value through OCI | 140,755,780 | 147,651,397 | 5,103,566 | - | - | 12,903,183 | 28,142,988 | 101,501,660 | - |
Financial investments at amortised cost | 28,399,073 | 32,497,878 | - | 2,458,798 | 5,653,384 | 9,513,458 | 3,505,613 | 11,366,625 | - |
Total assets | 1,274,737,827 | 1,316,915,817 | 413,474,613 | 206,306,421 | 303,153,535 | 118,535,165 | 52,191,388 | 195,528,884 | 27,725,811 |
Liabilities | |||||||||
Derivative liabilities held for risk | |||||||||
management | (626,476) | (626,476) | (455,055) | (86,901) | - | (84,520) | - | - | - |
Amounts owed to institutions | |||||||||
and banks | (333,498,402) | (334,541,899) | (241,844,225) | (57,762,015) | (22,436,754) | (3,867,403) | - | (8,631,502) | - |
Amounts owed to customers | (951,166,330) | (959,014,206) | (451,792,246) | (189,778,254) | (174,979,244) | (131,667,636) | (3,065,975) | (7,730,851) | - |
Other liabilities | (2,286,126) | (2,323,645) | (749,378) | (3,985) | (3,985) | (771,505) | (674,422) | (120,370) | - |
Total liabilities | (1,287,577,334) | (1,296,506,226) | (694,840,904) | (247,631,155) | (197,419,983) | (136,391,064) | (3,740,397) | (16,482,723) | - |
Liquidity gap | (281,366,291) | (41,324,734) | 105,733,552 | (17,855,899) | 48,450,991 | 179,046,161 | |||
Cumulative liquidity gap | (281,366,291) | (322,691,025) | (216,957,473) | (234,813,372) | (186,362,381) | (7,316,220) |
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Gross nominal | Between 6 | ||||||||
Carrying | inflow/ | Less than | Between 1 | Between 3 | months | Between 1 | More than | ||
amount | (outflow) | 1 month | & 3 months | & 6 months | & 1 year | & 2 years | 2 years | No maturity | |
USD | USD | USD | USD | USD | USD | USD | USD | USD | |
Assets | |||||||||
Balances with the Central Bank of Malta, treasury | |||||||||
bills and cash | 216,852,467 | 216,846,944 | 108,822,567 | 63,592,889 | 22,168,959 | 10,614,721 | - | - | 11,647,808 |
Derivative assets held for risk | |||||||||
management | 1,610,475 | 1,610,475 | 862,905 | 390,260 | 303,465 | 53,845 | - | - | - |
Loans and advances to banks | 125,882,432 | 127,388,882 | 62,723,131 | 44,292,108 | 289,242 | 10,240,463 | 970,605 | 8,873,333 | - |
Loans and advances to customers | 718,910,427 | 744,706,974 | 142,325,792 | 106,570,129 | 179,196,822 | 231,322,799 | 32,011,300 | 53,280,132 | - |
Financial investments at fair value through profit or loss | 18,179,220 | 18,179,220 | - | - | - | - | - | - | 18,179,220 |
Financial investments at fair value through OCI | 143,189,022 | 150,817,443 | - | 6,676,935 | 7,063,964 | - | 17,855,201 | 119,221,343 | - |
Financial investments at amortised | |||||||||
cost | 14,602,008 | 18,492,458 | - | - | 320,964 | 641,927 | 6,143,361 | 11,386,206 | - |
Total assets | 1,239,226,051 | 1,278,042,396 | 314,734,395 | 221,522,321 | 209,343,416 | 252,873,755 | 56,980,467 | 192,761,014 | 29,827,028 |
Liabilities | |||||||||
Derivative liabilities held for risk | |||||||||
management | (818,031) | (818,031) | (376,110) | (55,634) | (293,218) | (93,069) | - | - | - |
Amounts owed to institutions | |||||||||
and banks | (386,787,784) | (387,400,850) | (267,312,752) | (35,768,107) | (23,107,331) | (31,519,897) | (21,061,410) | (8,631,353) | - |
Amounts owed to customers | (869,220,415) | (872,042,506) | (456,012,219) | (185,413,108) | (80,572,219) | (138,418,846) | (10,512,968) | (1,113,146) | - |
Other liabilities | (3,490,312) | (3,583,821) | (698,520) | - | - | (715,521) | (1,456,463) | (713,317) | - |
Total liabilities | (1,260,316,542) | (1,263,845,208) | (724,399,601) | (221,236,849) | (103,972,768) | (170,747,333) | (33,030,841) | (10,457,816) | - |
Liquidity gap | (409,665,206) | 285,472 | 105,370,648 | 82,126,422 | 23,949,626 | 182,303,198 | |||
Cumulative liquidity gap | (409,665,206) |
FIMBank Group Annual Report & Financial Statements 2023
| Between 6 | |||||
Less than | Between 1 | Between 3 | months | ||
1 month | & 3 months | & 6 months | & 1 year | Total | |
USD | USD | USD | USD | USD | |
Derivatives | |||||
Inflows | 30,255,212 | 32,325,281 | 4,192,441 | 20,002,727 | 86,775,661 |
Outflows | (30,030,539) | (32,445,437) | (4,180,658) | (19,981,056) | (86,637,690) |
224,673 | (120,156) | 11,783 | 21,671 | 137,971 |
| Between 6 | |||||
Less than | Between 1 | Between 3 | months | ||
1 month | & 3 months | & 6 months | & 1 year | Total | |
USD | USD | USD | USD | USD | |
Derivatives | |||||
Inflows | 38,879,304 | 44,716,383 | 15,942,546 | 11,570,218 | 111,108,451 |
Outflows | (38,370,493) | (44,482,358) | (15,932,354) | (11,557,404) | (110,342,609) |
508,811 | 234,025 | 10,192 | 12,814 | 765,842 |
123
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In reporting | Other | ||||
currency | EUR | INR | currencies | Total | |
Assets | |||||
Balances with the Central Bank of Malta, treasury bills and cash | 26,008,194 | 326,995,938 | 25 | 6,029 | 353,010,186 |
Trading assets | 200,298,344 | 171,679,279 | - | 2,199,485 | 374,177,108 |
Loans and advances to banks | 68,308,036 | 66,654,529 | 12,882,667 | 4,969,716 | 152,814,948 |
Loans and advances to customers | 190,371,781 | 185,303,365 | 24,412,566 | 31,254,362 | 431,342,074 |
Financial investments at fair value through profit or loss | 52,358 | 18,636,495 | - | 640,987 | 19,329,840 |
Financial investments at fair value through other comprehensive income | 36,432,838 | 104,322,942 | - | - | 140,755,780 |
Financial investments at amortised cost | 16,517,721 | 2,236,359 | - | 9,644,993 | 28,399,073 |
Other assets | 157,879 | 3,633,741 | 1,099,918 | 115,785 | 5,007,323 |
Liabilities | |||||
Amounts owed to institutions and banks | (331,446,874) | (52,596,240) | (9,792,313) | (18,735,504) | (412,570,931) |
Amounts owed to customers | (55,716,559) | (873,460,598) | (1,606) | (5,560,179) | (934,738,942) |
Debt securities in issue | - | (27,543,864) | - | - | (27,543,864) |
Other liabilities | (7,502,745) | (6,898,542) | (1,864,740) | (1,188,141) | (17,454,168) |
Net on balance sheet financial position | 143,480,973 | (81,036,596) | 26,736,517 | 23,347,533 | 112,528,427 |
Notional amount of derivative instruments held for risk management | 20,808,471 | 31,636,970 | (30,024,203) | (22,421,238) | |
Net foreign exchange exposure | (49,399,626) | (3,287,686) | 926,295 |
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In reporting | Other | ||||
currency | EUR | INR | currencies | Total | |
Assets | |||||
Balances with the Central Bank of Malta, treasury bills and cash | 4,972,928 | 211,889,153 | 54 | 5,190 | 216,867,325 |
Trading assets | 256,046,083 | 164,524,398 | - | 24,013,180 | 444,583,661 |
Loans and advances to banks | 18,277,195 | 111,576,958 | 17,391,282 | 2,468,491 | 149,713,926 |
Loans and advances to customers | 253,710,493 | 188,821,633 | 17,080,447 | 24,915,484 | 484,528,057 |
Financial investments at fair value through profit or loss | 53,077 | 17,373,300 | - | 752,843 | 18,179,220 |
Financial investments at fair value through other comprehensive income | 46,888,196 | 96,300,826 | - | - | 143,189,022 |
Financial investments at amortised cost | 4,834,728 | - | - | 9,767,280 | 14,602,008 |
Other assets | 233,355 | 2,957,471 | 875,926 | 31,201 | 4,097,953 |
Liabilities | |||||
Amounts owed to institutions and banks | (354,275,351) | (103,912,057) | (6,306,950) | (8,800,898) | (473,295,256) |
Amounts owed to customers | (135,450,868) | (731,125,882) | (1,045,321) | (8,565,694) | (876,187,765) |
Debt securities in issue | - | (15,451,068) | - | - | (15,451,068) |
Other liabilities | (5,042,657) | (5,276,728) | (1,426,655) | (686,029) | (12,432,069) |
Net on balance sheet financial position | 90,247,179 | (62,321,996) | 26,568,783 | 43,901,048 | 98,395,014 |
Notional amount of derivative instruments held for risk management | 38,533,240 | 34,935,032 | (30,749,974) | (42,718,298) | |
Net foreign exchange exposure | (27,386,964) | (4,181,191) | 1,182,750 |
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In reporting | ||||
currency | EUR | Other currencies | Total | |
Assets | ||||
Balances with the Central Bank of Malta, treasury bills and cash | 26,004,091 | 326,989,945 | 3,021 | 352,997,057 |
Loans and advances to banks | 47,335,276 | 65,971,956 | 1,018,011 | 114,325,243 |
Loans and advances to customers | 244,372,334 | 361,849,371 | 11,896,520 | 618,118,225 |
Financial investments at fair value through profit or loss | 52,358 | 18,636,495 | 640,987 | 19,329,840 |
Financial investments at fair value through other comprehensive income | 36,432,838 | 104,322,942 | - | 140,755,780 |
Financial investments at amortised cost | 16,517,721 | 2,236,359 | 9,644,993 | 28,399,073 |
Other assets | 150,034 | 4,188,660 | 119,267 | 4,457,961 |
Liabilities | ||||
Amounts owed to institutions and banks | (280,898,394) | (52,596,240) | (3,768) | (333,498,402) |
Amounts owed to customers | (75,093,701) | (875,641,852) | (430,777) | (951,166,330) |
Other liabilities | (1,955,876) | (6,106,724) | (78,421) | (8,141,021) |
Net on balance sheet financial position | 12,916,681 | (50,149,088) | 22,809,833 | (14,422,574) |
Notional amount of derivative instruments held for risk management | 20,808,471 | 31,636,970 | (22,421,238) | |
Net foreign exchange exposure | (18,512,118) | 388,595 |
In reporting | ||||
All amounts are expressed in USD | currency | EUR | Other currencies | Total |
Assets | ||||
Balances with the Central Bank of Malta, treasury bills and cash | 4,968,702 | 211,882,265 | 1,500 | 216,852,467 |
Loans and advances to banks | 14,672,630 | 109,803,182 | 1,406,620 | 125,882,432 |
Loans and advances to customers | 364,210,570 | 321,592,456 | 33,107,401 | 718,910,427 |
Financial investments at fair value through profit or loss | 53,077 | 17,373,300 | 752,843 | 18,179,220 |
Financial investments at fair value through other comprehensive income | 46,888,196 | 96,300,826 | - | 143,189,022 |
Financial investments at amortised cost | 4,834,728 | - | 9,767,280 | 14,602,008 |
Other assets | 275,793 | 3,476,485 | 47,719 | 3,799,997 |
Liabilities | ||||
Amounts owed to institutions and banks | (299,275,979) | (87,502,890) | (8,915) | (386,787,784) |
Amounts owed to customers | (136,013,243) | (731,260,640) | (1,946,532) | (869,220,415) |
Other liabilities | (2,073,531) | (4,611,019) | (156,438) | (6,840,988) |
Net on balance sheet financial position | (1,459,057) | (62,946,035) | 42,971,478 | (21,433,614) |
Notional amount of derivative instruments held for risk management | 38,533,240 | 34,935,032 | (42,718,298) | |
Net foreign exchange exposure | (28,011,003) | 253,180 |
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Reporting date | ||||
Average rate | mid-spot rate | |||
2023 | 2022 | 2023 | 2022 | |
1 EUR | 1.0813 | 1.0517 | 1.1050 | 1.0666 |
1 INR | 0.0121 | 0.0127 | 0.0120 | 0.0121 |
Group | Profit or | Bank | Profit or | |
Equity | loss | Equity | loss | |
USD | USD | USD | USD | |
2023 | ||||
EUR | (3,457,974) | (3,457,974) | (1,295,848) | (1,295,848) |
INR | (230,138) | - | (2,101,694) | (2,101,694) |
Other currencies | 64,841 | 64,841 | 27,202 | 27,202 |
2022 | ||||
EUR | (1,917,087) | (1,917,087) | (1,960,770) | (1,960,770) |
INR | (292,683) | - | (2,152,498) | (2,152,498) |
Other currencies | 82,793 | 82,793 | 17,723 | 17,723 |
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Between | |||||||
Less than | Between | Between | 6 months | More than | Not subject to | ||
1 month | 1 & 3 months | 3 & 6 months | & 1 year | 1 year | interest rate risk | Total | |
USD | USD | USD | USD | USD | USD | USD | |
Assets | |||||||
Balances with the Central Bank of Malta, treasury bills and cash | 240,701,293 | 63,022,868 | 33,015,391 | 16,239,560 | - | 31,074 | 353,010,186 |
Trading assets | 80,639,382 | 193,032,230 | 64,490,802 | 26,217,441 | 9,257,253 | 540,000 | 374,177,108 |
Loans and advances to banks | 94,213,686 | 37,935,502 | 7,885,432 | 2,680,135 | 8,360,926 | 1,739,267 | 152,814,948 |
Loans and advances to customers | 291,462,685 | 13,914,819 | 110,025,707 | 8,687,579 | 6,242,329 | 1,008,955 | 431,342,074 |
Financial investments at fair value through comprehensive income | 4,985,000 | - | - | 12,644,664 | 122,543,659 | 582,457 | 140,755,780 |
Financial investments at amortised cost | - | 2,392,239 | 14,593,174 | 9,152,734 | 1,985,111 | 275,815 | 28,399,073 |
712,002,046 | 310,297,658 | 230,010,506 | 75,622,113 | 148,389,278 | 4,177,568 | 1,480,499,169 | |
Liabilities | |||||||
Amounts owed to institutions and banks | (283,644,872) | (81,653,270) | (32,099,448) | (3,867,403) | (8,517,194) | (2,788,744) | (412,570,931) |
Amounts owed to customers | (427,615,143) | (186,247,544) | (170,838,046) | (109,646,533) | (26,698,463) | (13,693,213) | (934,738,942) |
Debt securities in issue | (5,443,771) | (10,729,398) | (11,049,724) | - | - | (320,971) | (27,543,864) |
(716,703,786) | (278,630,212) | (213,987,218) | (113,513,936) | (35,215,657) | (16,802,928) | (1,374,853,737) | |
Interest sensitivity gap | (4,701,740) | 31,667,446 | 16,023,288 | (37,891,823) | 113,173,621 | (12,625,360) | |
Cumulative gap | 26,965,706 | 42,988,994 | 5,097,171 | 118,270,792 | 105,645,432 |
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Between | |||||||
Less than | Between | Between | 6 months | More than | Not subject to | ||
1 month | 1 & 3 months | 3 & 6 months | & 1 year | 1 year | interest rate risk | Total | |
USD | USD | USD | USD | USD | USD | USD | |
Assets | |||||||
Balances with the Central Bank of Malta, treasury bills and cash | 120,465,036 | 63,592,889 | 22,168,959 | 10,614,721 | - | 25,720 | 216,867,325 |
Trading assets | 98,058,032 | 161,988,854 | 114,021,769 | 54,861,037 | 15,043,969 | 610,000 | 444,583,661 |
Loans and advances to banks | 81,249,139 | 57,895,785 | 603,159 | 1,460,729 | 8,026,240 | 478,874 | 149,713,926 |
Loans and advances to customers | 440,155,127 | 21,086,987 | 17,220,848 | 4,342,432 | 947,174 | 775,489 | 484,528,057 |
Financial investments at fair value through other comprehensive income | - | 6,577,400 | 7,019,394 | - | 128,908,538 | 683,690 | 143,189,022 |
Financial investments at amortised cost | - | - | 9,762,043 | - | 4,822,489 | 17,476 | 14,602,008 |
739,927,334 | 311,141,915 | 170,796,172 | 71,278,919 | 157,748,412 | 2,591,250 | 1,453,483,999 | |
Liabilities | |||||||
Amounts owed to institutions and banks | (298,744,689) | (73,382,842) | (33,464,164) | (35,980,056) | (29,848,252) | (1,875,253) | (473,295,256) |
Amounts owed to customers | (462,080,830) | (184,544,303) | (79,961,228) | (135,889,074) | (11,306,295) | (2,406,035) | (876,187,765) |
Debt securities in issue | - | (15,419,088) | - | - | - | (31,980) | (15,451,068) |
(760,825,519) | (273,346,233) | (113,425,392) | (171,869,130) | (41,154,547) | (4,313,268) | (1,364,934,089) | |
Interest sensitivity gap | (20,898,185) | 37,795,682 | 57,370,780 | (100,590,211) | 116,593,863 | (1,722,018) | |
Cumulative gap | 16,897,497 | 74,268,277 | (26,321,934) | 90,271,929 | 88,549,911 |
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Between | |||||||
Less than | Between | Between | 6 months | More than | Not subject to | ||
1 month | 1 & 3 months | 3 & 6 months | & 1 year | 1 year | interest rate risk | Total | |
USD | USD | USD | USD | USD | USD | USD | |
Assets | |||||||
Balances with the Central Bank of Malta, treasury bills and cash | 240,701,293 | 63,022,868 | 33,015,391 | 16,239,560 | - | 17,945 | 352,997,057 |
Loans and advances to banks | 56,876,233 | 37,935,502 | 7,879,420 | 1,733,848 | 8,360,926 | 1,539,314 | 114,325,243 |
Loans and advances to customers | 452,436,857 | - | 156,471,975 | 5,281,294 | 2,149,494 | 1,778,605 | 618,118,225 |
Financial investments at fair value through other comprehensive income | 4,985,000 | - | - | 12,644,664 | 122,543,659 | 582,457 | 140,755,780 |
Financial investments at amortised cost | - | 2,392,239 | 14,593,174 | 9,152,734 | 1,985,111 | 275,815 | 28,399,073 |
754,999,383 | 103,350,609 | 211,959,960 | 45,052,100 | 135,039,190 | 4,194,136 | 1,254,595,378 | |
Liabilities | |||||||
Amounts owed to institutions and banks | (239,953,166) | (56,599,448) | (22,099,448) | (3,867,403) | (8,517,194) | (2,461,743) | (333,498,402) |
Amounts owed to customers | (449,500,336) | (186,247,544) | (170,838,046) | (109,776,533) | (26,698,463) | (8,105,408) | (951,166,330) |
(689,453,502) | (242,846,992) | (192,937,494) | (113,643,936) | (35,215,657) | (10,567,151) | (1,284,664,732) | |
Interest sensitivity gap | 65,545,881 | (139,496,383) | 19,022,466 | (68,591,836) | 99,823,533 | (6,373,015) | |
Cumulative gap | (73,950,502) | (54,928,036) | (123,519,872) | (23,696,339) | (30,069,354) |
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Between | |||||||
Less than | Between | Between | 6 months | More than | Not subject to | ||
1 month | 1 & 3 months | 3 & 6 months | & 1 year | 1 year | interest rate risk | Total | |
USD | USD | USD | USD | USD | USD | USD | |
Assets | |||||||
Balances with the Central Bank of Malta, treasury bills and cash | 120,465,036 | 63,592,889 | 22,168,959 | 10,614,721 | - | 10,862 | 216,852,467 |
Loans and advances to banks | 63,598,772 | 54,126,363 | - | - | 8,026,240 | 131,057 | 125,882,432 |
Loans and advances to customers | 679,034,772 | 14,982,597 | 16,497,328 | - | 5,637,778 | 2,757,952 | 718,910,427 |
Financial investments at fair value through other comprehensive income | - | 6,577,400 | 7,019,394 | - | 128,908,538 | 683,690 | 143,189,022 |
Financial investments at amortised cost | - | - | 9,762,043 | - | 4,822,489 | 17,476 | 14,602,008 |
863,098,580 | 139,279,249 | 55,447,724 | 10,614,721 | 147,395,045 | 3,601,037 | 1,219,436,356 | |
Liabilities | |||||||
Amounts owed to institutions and banks | (265,211,752) | (34,800,000) | (23,464,164) | (31,996,587) | (29,848,253) | (1,467,028) | (386,787,784) |
Amounts owed to customers | (455,085,104) | (184,544,303) | (79,961,228) | (135,917,390) | (11,306,297) | (2,406,093) | (869,220,415) |
(720,296,856) | (219,344,303) | (103,425,392) | (167,913,977) | (41,154,550) | (3,873,121) | (1,256,008,199) | |
Interest sensitivity gap | 142,801,724 | (80,065,054) | (47,977,668) | (157,299,256) | 106,240,495 | (272,084) | |
Cumulative gap | 62,736,670 | 14,759,002 | (142,540,254) | (36,299,759) | (36,571,843) |
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Parallel | Short rates | Short rates | ||||
Parallel up | down | up | down | Steepener | Flattener | |
USD | USD | USD | USD | USD | USD | |
Sensitivity of equity to interest rate | ||||||
movements | ||||||
Group | (7,487,322) | 4,281,044 | (80,259) | (338,276) | (3,885,533) | 1,154,989 |
Group (incl. Trading book) | (9,333,056) | 5,418,460 | (2,186,933) | 1,129,388 | (2,929,820) | (322,506) |
Bank | (7,517,131) | 4,408,833 | (93,716) | (143,029) | (3,788,942) | 1,099,473 |
Sensitivity of net interest income to Interest rate movements | ||||||
Group | (4,682,140) | 2,340,881 | - | - | - | - |
Group (incl. Trading book) | (369,710) | (1,672,173) | ||||
Bank | (671,968) | 335,984 | - | - | - | - |
Parallel | Short rates | Short rates | ||||
Parallel up | down | up | down | Steepener | Flattener | |
USD | USD | USD | USD | USD | USD | |
Sensitivity of equity to interest rate | ||||||
movements | ||||||
Group | (7,847,213) | 4,702,306 | 347,833 | (1,157,497) | (4,951,725) | 1,700,982 |
Group (incl. Trading book) | (10,518,954) | 6,156,513 | (2,589,432) | 993,783 | (3,703,790) | (532,287) |
Bank | (8,420,643) | 5,145,308 | 194,857 | (953,763) | (5,053,773) | 1,626,944 |
Sensitivity of net interest income to Interest rate movements | ||||||
Group | (5,231,995) | 2,615,997 | - | - | - | - |
Group (incl. Trading book) | 204,884 | (1,203,213) | ||||
Bank | 195,748 | (433,409) | - | - | - | - |
EUR | USD | ||
in basis points | in basis points | ||
Parallel up | +200 | +200 | |
Parallel down | -200 | -200 | |
Short rates up | +250 | +300 | |
Short rates down | -250 | -300 | |
Steepener | short rates down | -250 | -300 |
long rates up | +100 | +150 | |
Flattener | short rates up | +250 | +300 |
long rates down | -100 | -150 |
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Group | Bank | |||
2023 | 2022 | 2023 | 2022 | |
USD | USD | USD | USD | |
Financial investments at fair value through profit or loss | 19,329,840 | 18,179,220 | 19,329,840 | 18,179,220 |
Financial investments at fair value through other comprehensive income | 140,755,780 | 143,189,022 | 140,755,780 | 143,189,022 |
Trading assets | 374,177,108 | 444,583,661 | - | - |
Group | Bank | |||
Equity | Profit or loss | Equity | Profit or loss | |
USD | USD | USD | USD | |
2023 | 53,426,273 | 39,350,695 | 16,008,562 | 1,932,984 |
2022 | 60,595,190 | 46,276,288 | 16,136,824 | 1,817,922 |
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Level 1 | Level 2 | Level 3 | Total | |||
Note | USD | USD | USD | USD | ||
Assets | ||||||
Derivative assets held for risk management: | ||||||
– | foreign exchange | 20 | - | 715,713 | - | 715,713 |
Trading assets | 21 | - | - | 374,177,108 | 374,177,108 | |
Financial investments at fair value through profit or loss | 24 | - | - | 19,329,840 | 19,329,840 | |
Financial investments at fair value through other comprehensive income | 25 | 140,755,780 | - | - | 140,755,780 | |
Liabilities | ||||||
Derivative liabilities held for risk management: | ||||||
– | foreign exchange | 20 | - | 626,476 | - | 626,476 |
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Level 1 | Level 2 | Level 3 | Total | |||
Note | USD | USD | USD | USD | ||
Assets | ||||||
Derivative assets held for risk management: | ||||||
– | foreign exchange | 20 | - | 1,610,475 | - | 1,610,475 |
Trading assets | 21 | - | - | 444,583,661 | 444,583,661 | |
Financial investments at fair value through profit or loss | 24 | - | - | 18,179,220 | 18,179,220 | |
Financial investments at fair value through other comprehensive income | 25 | 143,189,022 | - | - | 143,189,022 | |
Liabilities | ||||||
Derivative liabilities held for risk management: | ||||||
– | foreign exchange | 20 | - | 578,779 | - | 578,779 |
Level 1 | Level 2 | Level 3 | Total | |||
Note | USD | USD | USD | USD | ||
Assets | ||||||
Derivative assets held for risk management: | ||||||
– | foreign exchange | 20 | - | 715,713 | - | 715,713 |
– | interest rate | 20 | - | 96,896 | - | 96,896 |
Financial investments at fair value through profit or loss | 24 | - | - | 19,329,840 | 19,329,840 | |
Financial investments at fair value through other comprehensive income | 25 | 140,755,780 | - | - | 140,755,780 | |
Liabilities | ||||||
Derivative liabilities held for risk management: | ||||||
– | foreign exchange | 20 | - | 626,476 | - | 626,476 |
Level 1 | Level 2 | Level 3 | Total | |||
Note | USD | USD | USD | USD | ||
Assets | ||||||
Derivative assets held for risk management: | ||||||
– | foreign exchange | 20 | - | 1,610,475 | - | 1,610,475 |
Financial investments at fair value through profit or loss | 24 | - | - | 18,179,220 | 18,179,220 | |
Financial investments at fair value through other comprehensive income | 25 | 143,189,022 | - | - | 143,189,022 | |
Liabilities | ||||||
Derivative liabilities held for risk management: | ||||||
– | foreign exchange | 20 | - | 723,311 | - | 723,311 |
– | interest rate | 20 | - | 94,720 | - | 94,720 |
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Financial investments | |||
Trading | at fair value through | ||
assets | profit or loss | Total | |
USD | USD | USD | |
Balance at 1 January 2023 | 444,583,661 | 18,179,220 | 462,762,881 |
Total gains and losses in profit or loss | (3,304,340) | 768,541 | (2,535,799) |
Purchases | 772,551,650 | - | 772,551,650 |
Settlements | (847,048,996) | (249,464) | (847,298,460) |
Effects of movement in exchange rates | 7,395,133 | 631,543 | 8,026,676 |
Balance at 31 December 2023 | 374,177,108 | 19,329,840 | 393,506,948 |
Financial investments | |||
Trading | at fair value through | ||
assets | profit or loss | Total | |
USD | USD | USD | |
Balance at 1 January 2022 | 439,985,203 | 19,966,163 | 459,951,366 |
Total gains and losses in profit or loss | (5,289,526) | (337,257) | (5,626,783) |
Purchases | 812,766,912 | - | 812,766,912 |
Settlements | (790,052,784) | (127,493) | (790,180,277) |
Effects of movement in exchange rates | (11,288,887) | (1,322,193) | (12,611,080) |
Write-off | (1,537,257) | - | (1,537,257) |
Balance at 31 December 2022 | 444,583,661 | 18,179,220 | 462,762,881 |
Financial investments | |
at fair value through | |
profit or loss | |
USD | |
Balance at 1 January 2023 | 18,179,220 |
Total gains and losses in profit or loss (Note 12) | 768,541 |
Settlements | (249,464) |
Effects of movement in exchange rates | 631,543 |
Balance at 31 December 2023 | 19,329,840 |
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Financial investments | |
at fair value through | |
profit or loss | |
USD | |
Balance at 1 January 2022 | 19,966,163 |
Total gains and losses in profit or loss (Note 12) | (337,257) |
Settlements | (127,493) |
Effects of movement in exchange rates | (1,322,193) |
Balance at 31 December 2022 | 18,179,220 |
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144
Mandatorily | Fair value | ||||
at fair value through other | Total | ||||
through | comprehensive | Amortised | carrying | ||
profit or loss | income | cost | amount | ||
USD | USD | USD | USD | ||
Balances with the Central Bank of Malta, treasury bills and cash | - | - | 353,010,186 | 353,010,186 | |
Derivative assets held for risk management | 715,713 | - | - | 715,713 | |
Trading assets | 374,177,108 | - | - | 374,177,108 | |
Loans and advances to banks | - | - | 152,814,948 | 152,814,948 | |
Loans and advances to customers | - | - | 431,342,074 | 431,342,074 | |
Financial investments at fair value through profit or loss | 19,329,840 | - | - | 19,329,840 | |
Financial investments at fair value through other comprehensive income | - | 140,755,780 | - | 140,755,780 | |
Financial investments at amortised cost | - | - | 28,399,073 | 28,399,073 | |
Total financial assets | 394,222,661 | 140,755,780 | 965,566,281 | 1,500,544,722 | |
Derivative liabilities held for risk management | 626,476 | - | - | 626,476 | |
Amounts owed to institutions and banks | - | - | 412,570,931 | 412,570,931 | |
Amounts owed to customers | - | - | 934,738,942 | 934,738,942 | |
Debt securities in issue | - | - | 27,543,864 | 27,543,864 | |
Total financial liabilities | 626,476 | - | 1,374,853,737 | 1,375,480,213 | |
Mandatorily | Fair value | ||||
at fair value through other | Total | ||||
through | comprehensive | Amortised | carrying | ||
profit or loss | income | cost | amount | ||
USD | USD | USD | USD | ||
Balances with the Central Bank of Malta, treasury bills and cash | - | - | 216,867,325 | 216,867,325 | |
Derivative assets held for risk management | 1,610,475 | - | - | 1,610,475 | |
Trading assets | 444,583,661 | - | - | 444,583,661 | |
Loans and advances to banks | - | - | 149,713,926 | 149,713,926 | |
Loans and advances to customers | - | - | 484,528,057 | 484,528,057 | |
Financial investments at fair value through profit or loss | 18,179,220 | - | - | 18,179,220 | |
Financial investments at fair value through other comprehensive income | - | 143,189,022 | - | 143,189,022 | |
Financial investments at amortised cost | - | - | 14,602,008 | 14,602,008 | |
Total financial assets | 464,373,356 | 143,189,022 | 865,711,316 | 1,473,273,694 | |
Derivative liabilities held for risk management | 578,779 | - | - | ˘ | |
Amounts owed to institutions and banks | - | - | 473,295,256 | 473,295,256 | |
Amounts owed to customers | - | - | 876,187,765 | 876,187,765 | |
Debt securities in issue | - | - | 15,451,068 | 15,451,068 | |
Total financial liabilities | 578,779 | - | 1,364,934,089 | 1,365,512,868 | |
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Mandatorily | Fair value | ||||
at fair value through other | Total | ||||
through | comprehensive | Amortised | carrying | ||
profit or loss | income | cost | amount | ||
USD | USD | USD | USD | ||
Balances with the Central Bank of Malta, treasury bills and cash | - | - | 352,997,057 | 352,997,057 | |
Derivative assets held for risk management | 812,609 | - | - | 812,609 | |
Loans and advances to banks | - | - | 114,325,243 | 114,325,243 | |
Loans and advances to customers | - | - | 618,118,225 | 618,118,225 | |
Financial investments at fair value through profit or loss | 19,329,840 | - | - | 19,329,840 | |
Financial investments at fair value through other comprehensive income | - | 140,755,780 | - | 140,755,780 | |
Financial investments at amortised cost | - | - | 28,399,073 | 28,399,073 | |
Total financial assets | 20,142,449 | 140,755,780 | 1,113,839,598 | 1,274,737,827 | |
Derivative liabilities held for risk management | 626,476 | - | - | 626,476 | |
Amounts owed to institutions and banks | - | - | 333,498,402 | 333,498,402 | |
Amounts owed to customers | - | - | 951,166,330 | 951,166,330 | |
Total financial liabilities | 626,476 | - | 1,284,664,732 | 1,285,291,208 | |
Mandatorily | Fair value | ||||
at fair value through other | Total | ||||
through | comprehensive | Amortised | carrying | ||
profit or loss | income | cost | amount | ||
USD | USD | USD | USD | ||
Balances with the Central Bank of Malta, treasury bills and cash | - | - | 216,852,467 | 216,852,467 | |
Derivative assets held for risk management | 1,610,475 | - | - | 1,610,475 | |
Loans and advances to banks | - | - | 125,882,432 | 125,882,432 | |
Loans and advances to customers | - | - | 718,910,427 | 718,910,427 | |
Financial investments at fair value through profit or loss | 18,179,220 | - | - | 18,179,220 | |
Financial investments at fair value through other comprehensive income | - | 143,189,022 | - | 143,189,022 | |
Financial investments at amortised cost | - | - | 14,602,008 | 14,602,008 | |
Total financial assets | 19,789,695 | 143,189,022 | 1,076,247,334 | 1,239,226,051 | |
Derivative liabilities held for risk management | 818,031 | - | - | 818,031 | |
Amounts owed to institutions and banks | - | - | 386,787,784 | 386,787,784 | |
Amounts owed to customers | - | - | 869,220,415 | 869,220,415 | |
Total financial liabilities | 818,031 | - | 1,256,008,199 | 1,256,826,230 | |
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Trade | ||||||
finance | Forfaiting | Factoring | Real estate | Treasury | Total | |
USD | USD | USD | USD | USD | USD | |
External revenue | ||||||
Interest income | 8,509,387 | 39,963,484 | 26,450,401 | 5,972,627 | 14,179,572 | 95,075,471 |
Net fee and commission income | 787,418 | (393,872) | (2,018,806) | 266,686 | 1,426,057 | 67,483 |
Net trading results | - | (2,311,622) | - | - | (909,247) | (3,220,869) |
Net gain from equity investments measured | ||||||
at fair value through profit or loss | - | - | - | - | 768,541 | 768,541 |
Dividend income | 40,228 | - | - | - | - | 40,228 |
9,337,033 | 37,257,990 | 24,431,595 | 6,239,313 | 15,464,923 | 92,730,854 | |
Reportable segment (loss)/profit | ||||||
before income tax | (7,500,796) | 5,239,554 | (5,334,734) | 838,713 | 5,644,155 | (1,113,108) |
Reportable segment assets | 208,133,452 | 376,786,416 | 257,987,873 | 79,907,966 | 566,602,064 | 1,489,417,771 |
Reportable segment liabilities | 67,431,324 | 85,277,723 | 39,142,428 | - | 1,195,844,251 | 1,387,695,726 |
FIMBank Group Annual Report & Financial Statements 2023
Group – 2022
| Trade | ||||||
| finance | Forfaiting | Factoring | Real estate | Treasury | Total | |
USD | USD | USD | USD | USD | USD | |
External revenue | ||||||
Interest income | 7,100,578 | 24,493,445 | 20,567,718 | 4,186,652 | 4,786,057 | 61,134,450 |
Net fee and commission income | 1,562,924 | (1,664,034) | (1,567,919) | 378,502 | 403,027 | (887,500) |
Net trading results | - | - | - | - | (6,924,935) | (6,924,935) |
| Net loss from equity investments measured | ||||||
| at fair value through profit or loss | - | - | - | - | (337,257) | (337,257) |
Dividend income | 3,821,545 | - | - | - | - | 3,821,545 |
12,485,047 | 22,829,411 | 18,999,799 | 4,565,154 | (2,073,108) | 56,806,303 | |
| Reportable segment (loss)/profit | ||||||
| before income tax | (26,699,125) | (2,392,144) | (6,446,742) | 2,820,656 | 736,079 | (31,981,276) |
Reportable segment assets | 182,627,460 | 449,275,957 | 292,223,041 | 77,270,524 | 487,167,696 | 1,488,564,678 |
Reportable segment liabilities | 73,356,379 | 78,640,525 | 39,490,526 | - | 1,182,568,369 | 1,374,055,799 |
2023 | 2022 | |
USD | USD | |
Revenues | ||
Total revenue for reportable segments | 92,730,854 | 56,806,303 |
Consolidation adjustments | (389,995) | (817,965) |
Other revenue | 921,017 | 865,004 |
Consolidated revenue | 93,261,876 | 56,853,342 |
Profit or loss | ||
Total loss for reportable segments | (1,113,108) | (31,981,276) |
Other gains | 2,117,960 | 1,712,049 |
1,004,852 | (30,269,227) | |
Effect of other consolidation adjustments on segment results | 4,789,355 | 5,554,787 |
Consolidated profit/(loss) before tax | 5,794,207 | (24,714,440) |
147
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148
2023 | 2022 | |
USD | USD | |
Assets | ||
Total assets for reportable segments | 1,489,417,771 | 1,488,564,678 |
Other assets | 71,846,826 | 74,133,687 |
1,561,264,597 | 1,562,698,365 | |
Effect of other consolidation adjustments on segment financial position | 19,419,367 | (6,561,712) |
Consolidated assets | 1,580,683,964 | 1,556,136,653 |
Liabilities | ||
Total liabilities for reportable segments | 1,387,695,726 | 1,374,055,799 |
Other liabilities | 12,849,534 | 15,137,817 |
1,400,545,260 | 1,389,193,616 | |
Effect of other consolidation adjustments on segment financial position | 841,572 | (3,567,061) |
Consolidated liabilities | 1,401,386,832 | 1,385,626,555 |
Consolidated revenue | ||
2023 | 2022 | |
USD | USD | |
Malta | 15,204,879 | 17,664,054 |
India | 12,264,518 | 9,509,807 |
Egypt | 11,701,172 | 6,514,887 |
Other countries (individually less than 10%) | 54,091,307 | 23,164,594 |
93,261,876 | 56,853,342 |
Non-current assets | ||
2023 | 2022 | |
USD | USD | |
Malta | 48,060,047 | 48,532,574 |
India | 647,296 | 877,226 |
Egypt | 558,072 | 747,513 |
Other countries (individually less than 10%) | 801,439 | 1,294,545 |
50,066,854 | 51,451,858 |
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149
Group | Bank | |||
2023 | 2022 | 2023 | 2022 | |
Restated | Restated | |||
Interest income | USD | USD | USD | USD |
On balances with the Central Bank of Malta and amounts owed to institutions * | 7,820,013 | 1,382,434 | 7,820,013 | 1,382,434 |
On loans and advances to banks | 2,694,747 | 1,278,124 | 1,918,045 | 613,716 |
On loans and advances to customers | 43,142,482 | 33,116,476 | 19,314,418 | 16,360,156 |
On loans and advances to subsidiary companies | - | - | 21,893,224 | 10,727,694 |
On trading assets | 39,962,687 | 24,491,993 | - | - |
On financial investments at fair value through other comprehensive income | 702,406 | 699,457 | 702,406 | 699,457 |
On financial investments at amortised cost | 1,170,202 | 465,178 | 1,170,202 | 465,178 |
95,492,537 | 61,433,662 | 52,818,308 | 30,248,635 | |
Interest expense | ||||
On balances with the Central Bank of Malta and amounts owed to institutions * | 8,680,808 | 1,958,000 | 8,680,808 | 1,958,000 |
On amounts owed to institutions and banks | 9,576,451 | 7,973,737 | 3,088,051 | 4,268,371 |
On amounts owed to customers | 21,304,973 | 6,934,007 | 21,304,973 | 6,934,007 |
On debt securities in issue | 545,041 | 415,775 | - | - |
On amounts owed to subsidiary companies | - | - | 22,361 | 1,365 |
On treasury bills purchased at a premium | 1,196 | 295,264 | 1,196 | 295,264 |
On lease liability owed to third parties (Note 30) | 134,203 | 86,379 | 45 | 6,018 |
On lease liability owed to subsidiary companies (Note 30) | - | - | 59,468 | 46,166 |
40,242,672 | 17,663,162 | 33,156,902 | 13,509,191 | |
Net interest income | 55,249,865 | 43,770,500 | 19,661,406 | 16,739,444 |
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Group | Bank | |||
2023 | 2022 | 2023 | 2022 | |
Restated | Restated | |||
USD | USD | USD | USD | |
Fee and commission income | ||||
Business introductions and other services provided to clients of London Forfaiting Company Limited | 2,021,134 | 1,196,527 | - | - |
Issuance and confirmation of letters of credit | 1,663,966 | 1,390,043 | 1,663,966 | 1,390,043 |
Issuance of guarantees and other fees and commissions | ||||
receivable in respect of real estate lending | 657,666 | 434,083 | 662,108 | 434,083 |
Payment fees and other bank charges | 903,116 | 978,136 | 721,538 | 832,170 |
Administrative fees on factoring receivables | 971 | 1,269 | 963 | 88,698 |
Issuance of guarantees to subsidiary companies | - | - | 67,603 | - |
5,246,853 | 4,000,058 | 3,116,178 | 2,744,994 | |
Fee and commission expense | ||||
Commissions paid to correspondent factors | 2,320,383 | 2,441,615 | 483,958 | 706,243 |
Agent fees and other administrative fees in respect of trading | ||||
assets | 2,097,160 | 1,308,000 | - | - |
Insurance fees in respect of factoring receivables | 774,977 | 1,436,318 | 382,658 | 752,072 |
Issuance of guarantees and other fees payable in respect of real | ||||
estate lending | 487,456 | 460,164 | 135,017 | 158,163 |
Bank charges | 298,884 | 348,504 | 196,990 | 272,963 |
Commissions paid to subsidiary companies in respect of services | ||||
rendered | - | - | - | 25,218 |
Other fees payable | 7,570 | 10,135 | 7,564 | 10,135 |
5,986,430 | 6,004,736 | 1,206,187 | 1,924,794 | |
Net fee and commission (expense)/income | (739,577) | (2,004,678) | 1,909,991 | 820,200 |
Group | Bank | |||
2023 | 2022 | 2023 | 2022 | |
USD | USD | USD | USD | |
Fair value movements on trading assets | (2,311,622) | (7,342,792) | - | - |
Fair value movements on derivatives held for risk management | (1,905,241) | (401,130) | (2,265,273) | 581,584 |
Net income from foreign exchange activities | 995,994 | 818,987 | 1,343,629 | 829,445 |
(3,220,869) | (6,924,935) | (921,644) | 1,411,029 |
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Group | Bank | |||
2023 | 2022 | 2023 | 2022 | |
USD | USD | USD | USD | |
Investment securities | ||||
Fair value movements on equity investments at fair value through profit or loss | 768,541 | (337,257) | 768,541 | (337,257) |
768,541 | (337,257) | 768,541 | (337,257) |
Group | Bank | |||
2023 | 2022 | 2023 | 2022 | |
USD | USD | USD | USD | |
Dividend income from equity investments at fair value through profit or loss | 40,228 | 3,821,545 | 40,228 | 3,821,545 |
Dividend income from subsidiary companies | - | - | 12,181,635 | 6,500,000 |
40,228 | 3,821,545 | 12,221,863 | 10,321,545 |
Group | Bank | |||
2023 | 2022 | 2023 | 2022 | |
USD | USD | USD | USD | |
Rental income from leased property (Note 30) | 840,123 | 834,721 | - | 51,268 |
Gain on disposal of property and equipment (Note 28) | 31,064 | 18,519 | 27,500 | 355 |
Other non-trading income | 49,830 | - | 49,830 | - |
Income receivable from subsidiary companies | - | - | 251,000 | 408,750 |
Gain on lease modifications (Note 30) | - | 11,764 | - | 106,101 |
921,017 | 865,004 | 328,330 | 566,474 |
Group | Bank | |||
2023 | 2022 | 2023 | 2022 | |
USD | USD | USD | USD | |
Write-off of property and equipment (Note 28) | 21,455 | - | 21,455 | - |
Fees payable on recoveries | - | 364,205 | - | 364,205 |
Other expenses | 3,076 | - | 3,076 | - |
24,531 | 364,205 | 24,531 | 364,205 |
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152
Group | Bank | |||
2023 | 2022 | 2023 | 2022 | |
USD | USD | USD | USD | |
Personnel expenses (Note 16.2) | 25,176,736 | 24,130,665 | 13,743,575 | 13,403,083 |
Professional fees | 5,590,505 | 2,732,707 | 3,168,599 | 1,505,412 |
IT software and hardware maintenance | 3,924,983 | 3,010,896 | 3,332,988 | 2,740,378 |
Regulatory fees | 1,844,949 | 1,716,979 | 1,621,813 | 1,612,557 |
Travel and telecommunication costs | 1,021,006 | 816,182 | 532,084 | 475,854 |
Insurance | 532,452 | 591,439 | 334,609 | 376,831 |
Property and equipment maintenance | 521,283 | 313,758 | 82,948 | 79,795 |
Subscriptions to service providers | 409,804 | 360,255 | 292,488 | 268,598 |
Marketing and advertising expenses | 351,807 | 297,011 | 228,779 | 216,766 |
Recruitment and training | 178,902 | 165,284 | 108,379 | 74,757 |
Expenses relating to short-term leases and leases of low-value assets (Note 30) | 501,735 | 489,673 | 285,930 | 216,699 |
Expenses relating to short-term leases and leases of low-value assets – subsidiary companies (Note 30) | - | - | 22,830 | - |
Recharge of services provided by subsidiary companies | - | - | 803,001 | 951,997 |
Other administrative expenses | 610,103 | 535,990 | 266,502 | 216,525 |
40,664,264 | 35,160,839 | 24,824,525 | 22,139,252 |
Other assurance | Tax | Other | ||||||
Audit services | services | advisory services | non-audit services | |||||
2023 | 2022 | 2023 | 2022 | 2023 | 2022 | 2023 | 2022 | |
USD | USD | USD | USD | USD | USD | USD | USD | |
By the auditors of the parent | 464,972 | 456,785 | 3,259 | 133,483 | - | 1,201 | 125,907 | 24,398 |
By the auditors of subsidiary | ||||||||
companies | 604,282 | 188,487 | 34,661 | 128,095 | 9,240 | 12,843 | 5,154 | 2,987 |
Other assurance | Tax | Other | ||||||
Audit services | services | advisory services | non-audit services | |||||
2023 | 2022 | 2023 | 2022 | 2023 | 2022 | 2023 | 2022 | |
USD | USD | USD | USD | USD | USD | USD | USD | |
By the auditors of the parent | 325,967 | 446,779 | 3,259 | 133,483 | - | - | 125,907 | 24,398 |
FIMBank Group Annual Report & Financial Statements 2023
153
Group | Bank | |||
2023 | 2022 | 2023 | 2022 | |
USD | USD | USD | USD | |
Directors’ emoluments | 388,497 | 416,359 | 388,497 | 416,359 |
Staff costs: | ||||
wages, salaries and allowances | 23,510,705 | 22,114,384 | 12,900,801 | 12,551,108 |
defined contribution costs | 1,177,534 | 1,099,922 | 454,277 | 435,616 |
end of service compensation (Note 37) | 100,000 | 500,000 | - | - |
25,176,736 | 24,130,665 | 13,743,575 | 13,403,083 |
Group | Bank | |||
2023 | 2022 | 2023 | 2022 | |
No. of | No. of | No. of | No. of | |
employees | employees | employees | employees | |
Executive and senior managerial | 40 | 40 | 24 | 24 |
Other managerial, supervisory and clerical | 274 | 275 | 148 | 150 |
Other staff | 8 | 8 | - | - |
322 | 323 | 172 | 174 |
FIMBank Group Annual Report & Financial Statements 2023
154
Group | Bank | |||
2023 | 2022 | 2023 | 2022 | |
Restated | Restated | |||
USD | USD | USD | USD | |
Current tax | (2,809,884) | (633,297) | (806,755) | (530,755) |
Deferred tax | (2,976,649) | (1,324,313) | - | - |
Taxation | (5,786,533) | (1,957,610) | (806,755) | (530,755) |
Tax (charge) | |||
Before tax | /credit | Net of tax | |
USD | USD | USD | |
Items that will not be reclassified subsequently to profit or loss | |||
Fair valuation of property | 1,314,568 | (34,308) | 1,280,260 |
1,314,568 | (34,308) | 1,280,260 | |
Items that are or may be reclassified subsequently to profit or loss | |||
Foreign currency translation differences for foreign operations | (621,862) | - | (621,862) |
(621,862) | - | (621,862) | |
Fair valuation of debt instruments: | |||
- fair value movement | 8,161,730 | - | 8,161,730 |
- movement in loss allowance | (42,344) | - | (42,344) |
8,119,386 | - | 8,119,386 | |
8,812,092 | (34,308) | 8,777,784 |
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155
Tax (charge) | ||||
Before tax | /credit | Net of tax | ||
USD | USD | USD | ||
Items that will not be reclassified subsequently to profit or loss | ||||
Fair valuation of property | - | 470,277 | 470,277 | |
- | 470,277 | 470,277 | ||
Items that are or may be reclassified subsequently to profit or loss | ||||
Foreign currency translation differences for foreign operations | (2,840,781) | - | (2,840,781) | |
(2,840,781) | - | (2,840,781) | ||
Fair valuation of debt instruments: | ||||
- | fair value movement | (23,139,340) | (1,331,704) | (24,471,044) |
- | movement in loss allowance | 43,513 | - | 43,513 |
(23,095,827) | (1,331,704) | (24,427,531) | ||
(25,936,608) | (861,427) | (26,798,035) |
Tax (charge) | ||||
Before tax | /credit | Net of tax | ||
USD | USD | USD | ||
Items that are or may be reclassified subsequently to profit or loss | ||||
Fair valuation of debt instruments: | ||||
- | fair value movement | 8,161,730 | - | 8,161,730 |
- | movement in loss allowance | (42,344) | - | (42,344) |
8,119,386 | - | 8,119,386 |
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156
Tax (charge) | ||||
Before tax | /credit | Net of tax | ||
USD | USD | USD | ||
Items that are or may be reclassified subsequently to profit or loss | ||||
Fair valuation of debt instruments: | ||||
- | fair value movement | (23,139,340) | (1,331,704) | (24,471,044) |
- | movement in loss allowance | 43,513 | - | 43,513 |
(23,095,827) | (1,331,704) | (24,427,531) |
Group | Bank | |||
2023 | 2022 | 2023 | 2022 | |
Restated | Restated | |||
USD | USD | USD | USD | |
Profit/(Loss) before tax | 5,794,207 | (24,714,440) | 3,296,903 | (21,479,329) |
Tax income using the domestic income tax rate of 35% | (2,027,972) | 8,650,054 | (1,153,916) | 7,517,765 |
Tax effect of: | ||||
Non-deductible expenses | (126,599) | (89,301) | (3,578) | (1,994) |
Non-deductible capital loss | - | (1,837,258) | - | (2,891,538) |
Non-taxable income | - | 1,337,541 | 4,263,572 | 3,612,541 |
Unrecognised temporary differences | (4,539,628) | (9,731,289) | (3,304,036) | (8,342,904) |
Different tax rates in foreign jurisdictions | 907,507 | (287,700) | (608,797) | (424,625) |
Other | 159 | 343 | - | - |
Taxation | (5,786,533) | (1,957,610) | (806,755) | (530,755) |
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157
Group | ||
2023 | 2022 | |
USD | USD | |
Loss attributable to the equity holders of the Bank | (30,812) | (26,590,278) |
2023 | 2022 | |
No. of shares | No. of shares | |
Weighted average number of ordinary shares at 31 December | 522,443,763 | 522,443,763 |
Group | Bank | |||
2023 | 2022 | 2023 | 2022 | |
Restated | Restated | |||
USD | USD | USD | USD | |
Cash | 19,916 | 24,541 | 6,787 | 9,683 |
Balances with the Central Bank of Malta | 221,803,752 | 91,550,151 | 221,803,752 | 91,550,151 |
Treasury bills | 131,270,544 | 125,410,680 | 131,270,544 | 125,410,680 |
Loss allowance | (84,026) | (118,047) | (84,026) | (118,047) |
353,010,186 | 216,867,325 | 352,997,057 | 216,852,467 |
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158
Group | Bank | |||
2023 | 2022 | 2023 | 2022 | |
USD | USD | USD | USD | |
Derivative assets held for risk management | ||||
foreign exchange | 715,713 | 1,610,475 | 715,713 | 1,610,475 |
interest rate | - | - | 96,896 | - |
715,713 | 1,610,475 | 812,609 | 1,610,475 | |
Derivative liabilities held for risk management | ||||
foreign exchange | (626,476) | (578,779) | (626,476) | (723,311) |
interest rate | - | - | - | (94,720) |
(626,476) | (578,779) | (626,476) | (818,031) |
Carrying amount | ||||||
Hedge | ||||||
ineffectiveness | ||||||
Amounts | recognised in | |||||
Derivative | Derivative | Nominal | recognised | Change in | income | |
assets | liabilities | amount | in OCI | fair value | statement | |
USD | USD | USD | USD | USD | USD | |
2023 | ||||||
Indian rupee denominated foreign exchange | - | 98,017 | 30,024,203 | (370,022) | (369,918) | 104 |
2022 | ||||||
Indian rupee denominated foreign exchange | 329,325 | - | 30,749,974 | 1,378,685 | 1,371,469 | (7,216) |
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159
31 December 2023 | 31 December 2022 | 1 January 2022 | |
Restated | Restated | ||
USD | USD | USD | |
Unencumbered loans and advances to banks: | |||
Repayable on call and at short notice | 51,126,590 | 16,362,142 | 35,044,550 |
Term loans and advances | 76,778,698 | 35,034,095 | 22,489,142 |
Pledged in favour of third parties | 25,149,244 | 98,759,904 | 141,341,035 |
Gross loans and advances to banks | 153,054,532 | 150,156,141 | 198,874,727 |
Loss allowance | (239,584) | (442,215) | (386,151) |
Net loans and advances to banks | 152,814,948 | 149,713,926 | 198,488,576 |
31 December 2023 | 31 December 2022 | 1 January 2022 | |
Restated | Restated | ||
USD | USD | USD | |
Unencumbered loans and advances to banks: | |||
Repayable on call and at short notice | 20,893,167 | 6,803,553 | 27,011,814 |
Term loans and advances | 68,498,510 | 20,736,746 | 14,474,062 |
Pledged in favour of third parties | 25,149,244 | 98,759,904 | 141,341,035 |
Gross loans and advances to banks | 114,540,921 | 126,300,203 | 182,826,911 |
Loss allowance | (215,678) | (417,771) | (368,363) |
Net loans and advances to banks | 114,325,243 | 125,882,432 | 182,458,548 |
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31 December 2023 | 31 December 2022 | 1 January 2022 | |
Restated | Restated | ||
USD | USD | USD | |
Unencumbered loans and advances to customers: | |||
Repayable on call and at short notice | 248,664,594 | 317,248,781 | 367,827,649 |
Term loans and advances | 201,313,207 | 241,994,141 | 226,756,238 |
Pledged in favour of third parties | 277,566 | 362,042 | 120,369 |
Gross loans and advances to customers | 450,255,367 | 559,604,964 | 594,704,256 |
Loss allowance on loans and advances to customers | (18,913,293) | (75,076,907) | (82,784,854) |
Net loans and advances to customers | 431,342,074 | 484,528,057 | 511,919,402 |
31 December 2023 | 31 December 2022 | 1 January 2022 | |
Restated | Restated | ||
USD | USD | USD | |
Unencumbered loans and advances to customers: | |||
Repayable on call and at short notice | 61,976,250 | 152,171,397 | 183,848,615 |
Term loans and advances | 201,313,207 | 241,994,141 | 226,749,228 |
Pledged in favour of third parties | 277,566 | 362,042 | 120,369 |
Loans and advances to subsidiary companies | 367,338,215 | 392,743,764 | 383,006,632 |
Gross loans and advances to customers | 630,905,238 | 787,271,344 | 793,724,844 |
Loss allowance on loans and advances to customers | (11,166,753) | (67,711,400) | (68,451,595) |
Loss allowance on loans and advances to subsidiary companies | (1,620,260) | (649,517) | (505,391) |
Net loans and advances to customers | 618,118,225 | 718,910,427 | 724,767,858 |
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Group | Bank | |||
2023 | 2022 | 2023 | 2022 | |
Restated | Restated | |||
USD | USD | USD | USD | |
Debt instruments: | ||||
issued by the Government of Malta | 35,947,692 | 32,338,352 | 35,947,692 | 32,338,352 |
issued by foreign sovereigns | 55,328,079 | 53,636,259 | 55,328,079 | 53,636,259 |
issued by foreign corporates | 49,480,009 | 57,214,411 | 49,480,009 | 57,214,411 |
140,755,780 | 143,189,022 | 140,755,780 | 143,189,022 | |
Loss allowance | (83,233) | (125,577) | (83,233) | (125,577) |
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Group | Bank | |||
2023 | 2022 | 2023 | 2022 | |
Restated | Restated | |||
USD | USD | USD | USD | |
Opening balance | 143,189,022 | 162,408,542 | 143,189,022 | 162,408,542 |
Acquisitions | - | 25,549,207 | - | 25,549,207 |
Redemptions | (13,745,002) | (13,000,000) | (13,745,002) | (13,000,000) |
Changes in fair value | 8,972,322 | (23,242,963) | 8,972,322 | (23,242,963) |
Amortisation of premium or discount | (1,050,827) | (1,190,114) | (1,050,827) | (1,190,114) |
Effects of movement in exchange rate | 3,390,265 | (7,335,650) | 3,390,265 | (7,335,650) |
Closing balance | 140,755,780 | 143,189,022 | 140,755,780 | 143,189,022 |
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31 December | ||||
2022 | 31 December | |||
as previously | Impact of | Impact of | 2022 | |
reported | reclassification | remeasurement | as restated | |
USD | USD | USD | USD | |
Statements of financial position | ||||
Assets | ||||
Financial investments at amortised cost: | ||||
debt investments at amortised cost | 182,756,964 | (168,132,745) | - | 14,624,219 |
interest accrued on debt investments at amortised cost | 701,166 | (683,690) | - | 17,476 |
loss allowance on debt investments at amortised cost | (165,264) | 125,577 | - | (39,687) |
Financial investments at fair value through other comprehensive income: | ||||
debt investments measured at FVOCI | - | 168,132,745 | (25,627,413) | 142,505,332 |
interest accrued on debt investments measured at FVOCI | - | 683,690 | - | 683,690 |
Equity | ||||
Fair value reserve: | ||||
valuation loss on debt investments measured | ||||
at FVOCI | - | - | (25,627,413) | (25,627,413) |
loss allowance on debt investments measured | ||||
at FVOCI | - | 125,577 | - | 125,577 |
Statements of profit or loss for the financial year ended 31 December 2022 (as restated) | ||||
Net movement in expected credit losses and other credit | ||||
impairment charges: | ||||
loss allowance on debt investments at measured | ||||
amortised cost | (107,642) | 125,577 | - | 17,935 |
loss allowance on debt investments measured | ||||
at FVOCI | 82,064 | (125,577) | - | (43,513) |
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1 January | ||||
2022 | 1 January | |||
as previously | Impact of | Impact of | 2022 | |
reported | reclassification | remeasurement | as restated | |
USD | USD | USD | USD | |
Statements of financial position | ||||
Assets | ||||
Financial investments at amortised cost: | ||||
Debt investments at amortised cost | 172,685,542 | (162,768,187) | - | 9,917,355 |
Interest accrued on debt investments at amortised cost | 851,745 | (796,724) | - | 55,021 |
Loss allowance on debt investments at amortised cost | (139,687) | 82,064 | - | (57,622) |
Financial investments at fair value through other comprehensive income: | ||||
Debt investments measured at FVOCI | - | 162,768,187 | (1,156,369) | 161,611,818 |
Interest accrued on debt investments measured at FVOCI | - | 796,724 | - | 796,724 |
Equity | ||||
Fair value reserve: | ||||
Valuation loss on debt investments measured | ||||
at FVOCI | - | - | (1,156,369) | (1,156,369) |
Loss allowance on debt investments measured | ||||
at FVOCI | - | 82,064 | - | 82,064 |
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Group | Bank | |||
2023 | 2022 | 2023 | 2022 | |
Restated | Restated | |||
USD | USD | USD | USD | |
Debt instruments: | ||||
issued by foreign sovereigns | 7,667,576 | - | 7,667,576 | - |
issued by foreign corporates | 20,862,658 | 14,641,695 | 20,862,658 | 14,641,695 |
Loss allowance | (131,161) | (39,687) | (131,161) | (39,687) |
28,399,073 | 14,602,008 | 28,399,073 | 14,602,008 |
Group | Bank | |||
2023 | 2022 | 2023 | 2022 | |
Restated | Restated | |||
USD | USD | USD | USD | |
Opening balance | 14,602,008 | 9,914,754 | 14,602,008 | 9,914,754 |
Acquisitions | 13,440,236 | 14,569,219 | 13,440,236 | 14,569,219 |
Redemptions | - | (9,800,719) | - | (9,800,719) |
Amortisation of premium or discount | 470,755 | 17,455 | 470,755 | 17,455 |
Effects of movement in exchange rate | (22,452) | (116,636) | (22,452) | (116,636) |
Movement in loss allowance | (91,474) | 17,935 | (91,474) | 17,935 |
Closing balance | 28,399,073 | 14,602,008 | 28,399,073 | 14,602,008 |
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Country of | Nature of | Equity | ||||
Name of company | incorporation | business | interest | Bank | ||
2023 | 2022 | 2023 | 2022 | |||
IT services | % | % | USD | USD | ||
FIM Business Solutions Limited | Malta | provider | 100 | 100 | 5,000 | 5,000 |
FIM Property Investment Limited | Malta | Property | 100 | 100 | 1,006,000 | 1,006,000 |
management | ||||||
London Forfaiting Company Limited | United Kingdom | Forfaiting | 100 | 100 | 112,966,435 | 107,966,435 |
The Egyptian Company for Factoring S.A.E. | Egypt | Factoring | 100 | 100 | 10,023,448 | 10,023,448 |
FIMFactors B.V. | Netherlands | Holding | 100 | 100 | 33,686,690 | 33,686,690 |
company | ||||||
157,687,573 | 152,687,573 |
Name of company | Country of incorporation | Nature of business | Equity interest | |
2023 | 2022 | |||
% | % | |||
London Forfaiting Americas Inc. | United States of America | Marketing | 100 | 100 |
London Forfaiting do Brasil Ltda. | Brazil | Marketing | 100 | 100 |
Bank | ||
2023 | 2022 | |
USD | USD | |
At 1 January | 152,687,573 | 159,448,858 |
Additional investment in London Forfaiting Company Limited | 5,000,000 | 1,500,000 |
Additional investment in FIM Property Investment Limited | - | 252 |
Impairment of investments in subsidiaries (refer to Note 27.3) | - | (8,261,536) |
Write-off of FIM Holdings (Chile) S.p.A. | - | (1) |
At 31 December | 157,687,573 | 152,687,573 |
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Freehold | Right-of-use | Improvement | Computer | ||||
land | Buildings | assets | to premises | equipment | Others | Total | |
USD | USD | USD | USD | USD | USD | USD | |
Cost | |||||||
At 1 January 2022 | 7,493,576 | 22,742,639 | 4,613,871 | 1,357,642 | 4,598,455 | 3,026,833 | 43,833,016 |
Reclassification of land and buildings to investment property | (1,011,055) | (4,158,209) | - | - | - | - | (5,169,264) |
Additions | - | 23,351 | 689,363 | - | 882,633 | 207,466 | 1,802,813 |
Disposals | - | - | - | (2,221) | (92,775) | (94,996) | |
Lease modifications that increase the scope of the lease | - | - | 818,861 | - | - | - | 818,861 |
Lease modifications that decrease the scope of the lease | - | - | (94,720) | - | - | - | (94,720) |
Derecognition of right-of-use asset upon termination of lease | - | - | (1,619,141) | - | - | - | (1,619,141) |
Effect of movement in exchange rates | - | - | (61,366) | (24,574) | (24,175) | (15,473) | (125,588) |
At 31 December 2022 | 6,482,521 | 18,607,781 | 4,346,868 | 1,333,068 | 5,454,692 | 3,126,051 | 39,350,981 |
At 1 January 2023 | 6,482,521 | 18,607,781 | 4,346,868 | 1,333,068 | 5,454,692 | 3,126,051 | 39,350,981 |
Reclassification of land and buildings to investment property | (299,423) | (724,151) | - | - | - | - | (1,023,574) |
Fair Value Movement | (952,938) | (2,114,168) | - | - | - | - | (3,067,106) |
Additions | - | 28,314 | 74,604 | 1,863 | 70,684 | 53,985 | 229,450 |
Disposals | - | - | - | - | - | (85,639) | (85,639) |
Write-offs | - | - | - | (181,347) | (2,970,474) | (336,720) | (3,488,541) |
Derecognition of right-of-use asset upon termination of lease | - | - | (41,120) | - | - | - | (41,120) |
Effect of movement in exchange rates | 233,218 | 668,645 | 8,812 | (858) | 794 | 9,825 | 920,436 |
At 31 December 2023 | 5,463,378 | 16,466,421 | 4,389,164 | 1,152,726 | 2,555,696 | 2,767,502 | 32,794,887 |
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Freehold | Right-of-use | Improvement | Computer | ||||
land | Buildings | assets | to premises | equipment | Others | Total | |
USD | USD | USD | USD | USD | USD | USD | |
Depreciation | |||||||
At 1 January 2022 | - | 2,889,245 | 2,450,144 | 835,505 | 3,982,128 | 2,765,540 | 12,922,562 |
Reclassification of buildings to investment property | - | (756,019) | - | - | - | - | (756,019) |
Charge for the year | - | 756,057 | 704,919 | 135,119 | 370,539 | 142,368 | 2,109,002 |
Release on disposals | - | - | - | (2,221) | (91,565) | (93,786) | |
Lease modifications that decrease the scope of the lease | - | - | (83,170) | - | - | - | (83,170) |
Derecognition of right-of-use asset upon termination of lease | - | - | (1,341,722) | - | - | - | (1,341,722) |
Effects of movement in exchange rates | - | - | (61,323) | (22,819) | (23,527) | (16,156) | (123,825) |
At 31 December 2022 | - | 2,889,283 | 1,668,848 | 947,805 | 4,326,919 | 2,800,187 | 12,633,042 |
At 1 January 2023 | - | 2,889,283 | 1,668,848 | 947,805 | 4,326,919 | 2,800,187 | 12,633,042 |
Reclassification of buildings to investment property | - | 217,536 | - | - | - | - | 217,536 |
Charge for the year | - | 660,267 | 769,270 | 131,643 | 435,605 | 216,252 | 2,213,037 |
Release on disposals | - | - | - | - | - | (85,639) | (85,639) |
Write-offs | - | - | - | (160,686) | (2,970,474) | (335,926) | (3,467,086) |
Derecognition of right-of-use asset upon termination of lease | - | - | (41,120) | - | - | - | (41,120) |
Derecognition of depreciation upon revaluation of asset | - | (3,867,931) | - | - | - | - | (3,867,931) |
Effects of movement in exchange rates | - | 100,845 | 1,147 | (879) | (7,955) | (85,360) | 7,798 |
At 31 December 2023 | - | - | 2,398,145 | 917,883 | 1,784,095 | 2,509,514 | 7,609,637 |
Carrying amounts | |||||||
At 1 January 2022 | 7,493,576 | 19,853,394 | 2,163,727 | 522,137 | 616,327 | 261,293 | 30,910,454 |
At 31 December 2022 | 6,482,521 | 15,718,498 | 2,678,020 | 385,263 | 1,127,773 | 325,864 | 26,717,939 |
At 31 December 2023 | 5,463,378 | 16,466,421 | 1,991,019 | 234,843 | 771,601 | 257,988 | 25,185,250 |
Carrying amount had the assets been carried at cost | |||||||
At 31 December 2023 | 3,540,684 | 11,721,100 | 1,991,019 | 234,843 | 769,750 | 248,358 | 18,505,754 |
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Right-of-use | Improvement | Computer | |||
assets | to premises | equipment | Others | Total | |
USD | USD | USD | USD | USD | |
Cost | |||||
At 1 January 2022 | 5,914,995 | 710,821 | 3,733,495 | 2,021,950 | 12,381,261 |
Additions | 4,009,002 | - | 855,307 | 61,313 | 4,925,622 |
Release on disposals | - | - | (2,221) | (42,948) | (45,169) |
Lease modifications that decrease the scope of the lease | (94,720) | - | - | - | (94,720) |
Derecognition of right-of-use asset upon termination of lease | (5,638,486) | - | - | - | (5,638,486) |
At 31 December 2022 | 4,190,791 | 710,821 | 4,586,581 | 2,040,315 | 11,528,508 |
At 1 January 2023 | 4,190,791 | 710,821 | 4,586,581 | 2,040,315 | 11,528,508 |
Additions | 74,512 | 1,863 | 14,633 | 18,376 | 109,384 |
Disposals | - | - | - | (55,568) | (55,568) |
Write-offs | - | (181,347) | (2,970,474) | (336,720) | (3,488,541) |
At 31 December 2023 | 4,265,303 | 531,337 | 1,630,740 | 1,666,403 | 8,093,783 |
Depreciation | |||||
At 1 January 2022 | 4,835,155 | 442,238 | 3,216,753 | 1,921,866 | 10,416,012 |
Charge for the year | 1,420,098 | 42,080 | 314,016 | 42,706 | 1,818,900 |
Release on disposals | - | - | (2,221) | (41,738) | (43,959) |
Lease modifications that decrease the scope of the lease | (83,170) | - | - | - | (83,170) |
Derecognition of right-of-use asset upon termination of lease | (5,349,516) | - | - | - | (5,349,516) |
At 31 December 2022 | 822,567 | 484,318 | 3,528,548 | 1,922,834 | 6,758,267 |
At 1 January 2023 | 822,567 | 484,318 | 3,528,548 | 1,922,834 | 6,758,267 |
Charge for the year | 1,409,743 | 40,641 | 376,874 | 36,128 | 1,863,386 |
Release on disposals | - | - | - | (55,568) | (55,568) |
Write-offs | - | (160,686) | (2,970,474) | (335,926) | (3,467,086) |
At 31 December 2023 | 2,232,310 | 364,273 | 934,948 | 1,567,468 | 5,098,999 |
Carrying amounts | |||||
At 1 January 2022 | 1,079,840 | 268,583 | 516,742 | 100,084 | 1,965,249 |
At 31 December 2022 | 3,368,224 | 226,503 | 1,058,033 | 117,481 | 4,770,241 |
At 31 December 2023 | 2,032,993 | 167,064 | 695,792 | 98,935 | 2,994,784 |
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Range of | Inter-relationship between key | |||
Significant | unobservable inputs | unobservable inputs and fair | ||
Valuation technique | unobservable inputs | per annum | value measurements | |
Investment income | Rental value per | €286 to €553 | The higher the rate per square | |
Office space | approach | square metre | (2022: €288 to €476) | metre the higher the fair value |
Investment income | Capitalisation rate | 6.25% | The higher the capitalisation rate | |
approach | (2022: | 6.0%) | the lower the fair value | |
Investment income | Rental value per | €82 to €233 | The higher the rate per square | |
Parking space | approach | square metre | (2022: €85 to €210) | metre the higher the fair value |
Investment income | Capitalisation rate | 7.0% | The higher the capitalisation rate | |
approach | (2022: | 7.5%) | the lower the fair value | |
Investment income | Rental value per | €64 to €200 | The higher the rate per square | |
Stores and ancillary | approach | square metre | (2022: €60 to €170) | metre the higher the fair value |
Investment income | Capitalisation rate | 8.0% | The higher the capitalisation rate | |
approach | (2022: | 9.0%) | the lower the fair value |
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Group | ||
2023 | 2022 | |
USD | USD | |
At 1 January | 21,637,065 | 17,223,820 |
Reclassification from ‘Property and equipment’ | 1,241,110 | 4,413,245 |
Fair value movement | (1,398,978) | - |
Effect of movement in exchange rates | 778,420 | - |
At 31 December | 22,257,617 | 21,637,065 |
Carrying amount | ||
Cost | 15,207,960 | 13,966,850 |
Cumulative fair value movements | 7,049,657 | 7,670,215 |
Carrying amount | 22,257,617 | 21,637,065 |
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Range of | Inter-relationship between key | |||
Significant | unobservable inputs | unobservable inputs and fair | ||
Valuation technique | unobservable inputs | per annum | value measurements | |
Investment income | Rental value per | €286 to €553 | The higher the rate per square | |
Office space | approach | square metre | (2022: €288 to €476) | metre the higher the fair value |
Investment income | Capitalisation rate | 6.25% | The higher the capitalisation rate | |
approach | (2022: | 6.0%) | the lower the fair value | |
Investment income | Rental value per | €237 to €365 | The higher the rate per square | |
Retail space | approach | square metre | (2022: €85 to €210) | metre the higher the fair value |
Investment income | Capitalisation rate | 6.75% | The higher the capitalisation rate | |
approach | (2022: | 7.50%) | the lower the fair value | |
Investment income | Rental value per | €64 to €200 | The higher the rate per square | |
Stores and ancillary | approach | square metre | (2022: €60 to €170) | metre the higher the fair value |
Investment income | Capitalisation rate | 8.0% | The higher the capitalisation rate | |
approach | (2022: | 9.0%) | the lower the fair value |
Group | Bank | |||
2023 | 2022 | 2023 | 2022 | |
USD | USD | USD | USD | |
Balance at 1 January | 2,678,020 | 2,163,727 | 3,368,224 | 1,079,840 |
Depreciation charge for the year | (769,270) | (704,919) | (1,409,743) | (1,420,098) |
Additions | 74,604 | 689,363 | 74,512 | 4,009,002 |
Lease modifications that increase the scope of the lease | - | 818,861 | - | - |
Lease modifications that decrease the scope of the lease | - | (11,550) | - | (11,550) |
Derecognition of right-of-use asset upon termination of lease | - | (277,419) | - | (288,970) |
Effect of movement in exchange rates | 7,665 | (43) | - | - |
Balance at 31 December | 1,991,019 | 2,678,020 | 2,032,993 | 3,368,224 |
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Group | Bank | |||
2023 | 2022 | 2023 | 2022 | |
USD | USD | USD | USD | |
Balance at 1 January | 2,704,717 | 2,224,450 | 3,490,312 | 1,128,593 |
Additions | 74,604 | 1,508,224 | 74,512 | 4,009,002 |
Lease modifications that decrease the scope of the lease | - | (300,733) | - | (406,621) |
Interest expense | 134,203 | 86,379 | 59,513 | 52,184 |
Payments | (830,369) | (700,703) | (1,450,567) | (1,330,082) |
Effect of movement in exchange rates | 35,408 | (112,900) | 112,356 | 37,236 |
Balance at 31 December | 2,118,563 | 2,704,717 | 2,286,126 | 3,490,312 |
Group | Bank | |||
2023 | 2022 | 2023 | 2022 | |
USD | USD | USD | USD | |
Interest on lease liabilities (Note 9) | 134,203 | 86,379 | 59,513 | 52,184 |
Gains on lease modifications (Note 14) | - | 11,764 | - | 106,101 |
Expenses relating to short-term leases (Note 16) | 494,121 | 461,064 | 307,621 | 193,124 |
Expenses relating to leases of low-value assets, excluding | ||||
short-term leases of low-value assets (Note 16) | 7,614 | 28,609 | 1,139 | 23,575 |
Group | ||
2023 | 2022 | |
USD | USD | |
Less than one year | 614,380 | 513,964 |
Between one and five years | 1,540,060 | 1,193,351 |
Total | 2,154,440 | 1,707,315 |
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Goodwill | Software | Total | |
USD | USD | USD | |
Cost | |||
At 1 January 2022 | 14,423,542 | 11,784,465 | 26,208,007 |
Additions | - | 318,308 | 318,308 |
Write-offs | (13,163,836) | - | (13,163,836) |
Effects of movement in exchange rates | (1,259,706) | (3,895) | (1,263,601) |
At 31 December 2022 | - | 12,098,878 | 12,098,878 |
At 1 January 2023 | - | 12,098,878 | 12,098,878 |
Additions | - | 490,433 | 490,433 |
Write-offs | - | (2,844,202) | (2,844,202) |
Effects of movement in exchange rates | - | 277 | 277 |
At 31 December 2023 | - | 9,745,386 | 9,745,386 |
Accumulated amortisation and impairment losses | |||
At 1 January 2022 | 8,818,192 | 8,013,220 | 16,831,412 |
Charge for the year | - | 992,582 | 992,582 |
Write-offs | (13,163,836) | - | (13,163,836) |
Impairment loss | 5,249,307 | - | 5,249,307 |
Effects of movement in exchange rates | (903,663) | (3,778) | (907,441) |
At 31 December 2022 | - | 9,002,024 | 9,002,024 |
At 1 January 2023 | - | 9,002,024 | 9,002,024 |
Charge for the year | - | 963,300 | 963,300 |
Write-offs | - | (2,844,202) | (2,844,202) |
Effects of movement in exchange rates | - | 277 | 277 |
At 31 December 2023 | - | 7,121,399 | 7,121,399 |
Carrying amounts | |||
At 1 January 2022 | 5,605,350 | 3,771,245 | 9,376,595 |
At 31 December 2022 | - | 3,096,854 | 3,096,854 |
At 31 December 2023 | - | 2,623,987 | 2,623,987 |
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Software | |
USD | |
Cost | |
At 1 January 2022 | 11,711,496 |
Additions | 318,308 |
At 31 December 2022 | 12,029,804 |
At 1 January 2023 | 12,029,804 |
Additions | 490,433 |
Write-offs | (2,844,202) |
At 31 December 2023 | 9,676,035 |
Accumulated amortisation | |
At 1 January 2022 | 7,937,181 |
Charge for the year | 992,770 |
At 31 December 2022 | 8,929,951 |
At 1 January 2023 | 8,929,951 |
Charge for the year | 965,550 |
Write-offs | (2,844,202) |
At 31 December 2023 | 7,051,299 |
Carrying amounts | |
At 1 January 2022 | 3,774,315 |
At 31 December 2022 | 3,099,853 |
At 31 December 2023 | 2,624,736 |
Group | ||
2023 | 2022 | |
USD | USD | |
India Factoring | ||
cost, net of exchange differences | - | 12,292,542 |
accumulated impairment, net of exchange differences | - | (12,292,542) |
- | - | |
Egypt Factors | ||
cost | - | 2,131,000 |
accumulated impairment | - | (2,131,000) |
- | - |
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Group | Bank | |||
2023 | 2022 | 2023 | 2022 | |
Restated | Restated | |||
USD | USD | USD | USD | |
Deferred tax assets | ||||
Tax effect of temporary differences relating to: | ||||
excess of capital allowances over depreciation | (512,806) | (680,857) | (562,820) | (735,325) |
expected credit loss allowances | 7,643,657 | 8,932,627 | 4,021,841 | 6,896,077 |
changes in fair value of financial instruments | 76,463 | 76,463 | 76,463 | 76,463 |
unabsorbed capital allowances | 622,026 | 622,026 | 622,026 | 622,026 |
unabsorbed tax losses | 11,168,547 | 13,051,158 | 10,758,727 | 8,145,593 |
lease liabilities | 374,928 | 2,218,747 | 800,144 | 597,709 |
right-of-use assets | (372,336) | (2,218,747) | (711,547) | (597,709) |
Total deferred tax assets | 19,000,479 | 22,001,417 | 15,004,834 | 15,004,834 |
Deferred tax liabilities | ||||
Tax effect of temporary differences relating to: | ||||
fair valuation of property and equipment | 2,486,352 | 2,366,893 | - | - |
fair valuation of investment property | 1,780,609 | 1,730,965 | - | - |
Total deferred tax liabilities | 4,266,961 | 4,097,858 | - | - |
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Recognised in | |||||
other | Effect of | ||||
Opening | comprehensive | Recognised in | movement in | Closing | |
balance | income | profit or loss | exchange rates | balance | |
USD | USD | USD | USD | USD | |
2023 | |||||
Excess of capital allowances over depreciation | (680,857) | - | 168,240 | (189) | (512,806) |
Expected credit loss allowances | 8,932,627 | - | (1,270,510) | (18,460) | 7,643,657 |
Changes in fair values of financial instruments | 76,463 | - | - | - | 76,463 |
Unabsorbed capital allowances | 622,026 | - | - | - | 622,026 |
Unabsorbed tax losses | 13,051,158 | - | (1,888,237) | 5,626 | 11,168,547 |
Lease liabilities | 2,266,262 | - | (1,892,389) | 1,055 | 374,928 |
Right-of-use assets | (2,266,262) | - | 1,894,912 | (986) | (372,336) |
22,001,417 | - | (2,987,984) | (12,954) | 19,000,479 | |
2022 (Restated) | |||||
Excess of capital allowances over depreciation | (665,157) | - | (8,971) | (6,729) | (680,857) |
Expected credit loss allowances | 10,059,105 | - | (841,197) | (285,281) | 8,932,627 |
Changes in fair values of financial instruments | 1,408,167 | (1,331,704) | - | - | 76,463 |
Unabsorbed capital allowances | 622,026 | - | - | - | 622,026 |
Unabsorbed tax losses | 13,410,430 | - | (35,129) | (324,143) | 13,051,158 |
Lease liabilities | 2,274,845 | - | (56,098) | - | 2,218,747 |
Right-of-use assets | (2,218,747) | - | - | - | (2,218,747) |
Other temporary differences | 29,858 | - | (29,858) | - | - |
24,920,527 | (1,331,704) | (971,253) | (616,153) | 22,001,417 |
Recognised in | |||||
other | Effect of | ||||
Opening | comprehensive | Recognised in | movement in | Closing | |
balance | income | profit or loss | exchange rates | balance | |
USD | USD | USD | USD | USD | |
2023 | |||||
Excess of capital allowances over depreciation | (735,325) | - | 172,505 | - | (562,820) |
Expected credit loss allowances | 6,896,077 | - | (2,874,236) | - | 4,021,841 |
Changes in fair values of financial instruments | 76,463 | - | - | - | 76,463 |
Unabsorbed capital allowances | 622,026 | - | - | - | 622,026 |
Unabsorbed tax losses | 8,145,593 | - | 2,613,134 | - | 10,758,727 |
Lease liabilities | 597,709 | - | 202,435 | - | 800,144 |
Right-of-use assets | (597,709) | - | (113,838) | - | (711,547) |
15,004,834 | - | - | - | 15,004,834 | |
2022 (Restated) | |||||
Excess of capital allowances over depreciation | (735,325) | - | - | - | (735,325) |
Expected credit loss allowances | 6,810,121 | - | 85,956 | - | 6,896,077 |
Changes in fair values of financial instruments | 1,408,167 | (1,331,704) | - | - | 76,463 |
Unabsorbed capital allowances | 622,026 | - | - | - | 622,026 |
Unabsorbed tax losses | 8,145,593 | - | - | - | 8,145,593 |
Lease liabilities | 653,807 | - | (56,098) | - | 597,709 |
Right-of-use assets | (597,709) | - | - | - | (597,709) |
Other temporary differences | 29,858 | - | (29,858) | - | - |
16,336,538 | (1,331,704) | - | - | 15,004,834 |
FIMBank Group Annual Report & Financial Statements 2023
182
Recognised in | Effect of | ||||
other | movement in | ||||
Opening | comprehensive | Recognised in | exchange | Closing | |
balance | income | profit or loss | rates | balance | |
USD | USD | USD | USD | ||
2023 | |||||
Changes in fair value of investment property | |||||
and property and equipment | (4,097,858) | (34,308) | 12,911 | (147,706) | (4,266,961) |
2022 | |||||
Changes in fair value of investment property | |||||
and property and equipment | (4,215,075) | 470,277 | (353,060) | - | (4,097,858) |
Group | Bank | |||
2023 | 2022 | 2023 | 2022 | |
Restated | Restated | |||
USD | USD | USD | USD | |
Accounts receivable and prepayments | 5,273,208 | 5,001,366 | 4,004,424 | 3,999,635 |
Accrued income | 167,308 | 80,962 | 68,901 | 54,619 |
Indirect taxation receivable | 210,013 | 223,532 | 160,427 | 171,732 |
Cash pledged in favour of the Depositor Compensation Scheme | 2,811,005 | 2,149,970 | 2,811,005 | 2,149,970 |
Cash pledged in favour of the Single Resolution Fund | 445,474 | 388,680 | 445,474 | 388,680 |
Other assets | 254,052 | 66,980 | 256,879 | 65,648 |
9,161,060 | 7,911,490 | 7,747,110 | 6,830,284 |
FIMBank Group Annual Report & Financial Statements 2023
183
Group | Bank | |||
2023 | 2022 | 2023 | 2022 | |
USD | USD | USD | USD | |
Term loans and deposits | 343,559,071 | 389,266,657 | 264,486,542 | 302,759,185 |
Repayable on demand | 69,011,860 | 84,028,599 | 69,011,860 | 84,028,599 |
412,570,931 | 473,295,256 | 333,498,402 | 386,787,784 |
31 December 2023 | 31 December 2022 | 1 January 2022 | |
Restated | Restated | ||
USD | USD | USD | |
Term deposits | 814,978,653 | 732,574,374 | 679,438,958 |
Repayable on demand | 119,760,289 | 143,613,391 | 142,735,821 |
934,738,942 | 876,187,765 | 822,174,779 | |
Bank | 31 December 2023 | 31 December 2022 | 1 January 2022 |
Restated | Restated | ||
USD | USD | USD | |
Term deposits | 814,978,653 | 732,574,374 | 679,438,958 |
Repayable on demand | 114,172,044 | 135,778,190 | 135,975,523 |
Amounts owed to subsidiary companies | 22,015,633 | 867,851 | 7,536,357 |
951,166,330 | 869,220,415 | 822,950,838 |
FIMBank Group Annual Report & Financial Statements 2023
184
2023 | 2022 | |
USD | USD | |
Opening balance | 15,451,068 | 45,345,575 |
Drawdowns | 38,142,327 | 72,331,491 |
Repayments | (26,893,950) | (99,499,621) |
Movement in accrued interest | 288,991 | (87,889) |
Effects of movement in exchange rate | 555,428 | (2,638,488) |
Closing balance | 27,543,864 | 15,451,068 |
Group | Bank | |||
2023 | 2022 | 2023 | 2022 | |
USD | USD | USD | USD | |
Expected credit loss provision on guarantees | 7,551 | 43,775 | 7,551 | 43,777 |
Expected credit loss provision on guarantees | ||||
- subsidiary companies | - | - | 277 | 31,647 |
Expected credit loss provision on commitments | 82,307 | 277,120 | 82,307 | 44,551 |
Expected credit loss provision on commitments | ||||
- subsidiary companies | - | - | - | 1,234 |
Provision for end of service compensation | - | 500,000 | - | - |
Provision for restoration costs | 92,093 | 86,860 | - | - |
Other provisions | 54,263 | - | - | - |
236,214 | 907,755 | 90,135 | 121,209 |
FIMBank Group Annual Report & Financial Statements 2023
185
Group | Bank | |||
2023 | 2022 | 2023 | 2022 | |
USD | USD | USD | USD | |
Creditors and accruals | 15,299,353 | 10,815,857 | 7,322,316 | 6,500,079 |
Deferred fee income | 1,124,775 | 1,052,870 | 442,924 | 277,566 |
Indirect taxation payable | 46,752 | 53,391 | - | 375 |
Lease liabilities (Note 30) | 2,118,563 | 2,704,717 | 2,286,126 | 3,490,312 |
Other liabilities | 1,182,172 | 230,615 | 582,172 | 230,616 |
19,771,615 | 14,857,450 | 10,633,538 | 10,498,948 |
2023 | 2022 | |||
Shares of 50 US cents | Shares of 50 US cents | |||
Shares | USD | Shares | USD | |
Authorised | ||||
Ordinary shares at 31 December | 1,000,000,000 | 500,000,000 | 1,000,000,000 | 500,000,000 |
Issued and fully paid up Ordinary shares at 31 December | 522,443,763 | 261,221,882 | 522,443,763 | 261,221,882 |
Ordinary shares | ||
2023 | 2022 | |
No of shares | No of shares | |
On issue at 1 January | 522,443,763 | 522,443,763 |
On issue at 31 December | 522,443,763 | 522,443,763 |
FIMBank Group Annual Report & Financial Statements 2023
186
FIMBank Group Annual Report & Financial Statements 2023
187
India Factoring | |
Acquisition date | 31 March 2014 |
NCI percentage | 11.84% |
USD | |
Total assets | 129,328,698 |
Total liabilities | (91,715,879) |
Net assets | 37,612,819 |
Carrying amount of NCI | 519,162 |
Net revenue for the year | 5,853,429 |
Net revenue for the year allocated to NCI | 693,046 |
Profit for the year | 325,047 |
Profit allocated to NCI | 38,486 |
Net increase in cash and cash equivalents | 11,156,992 |
India Factoring | |
Acquisition date | 31 March 2014 |
NCI percentage | 11.84% |
USD | |
Total assets | 222,968,423 |
Total liabilities | (185,531,925) |
Net assets | 37,436,498 |
Carrying amount of NCI | 482,593 |
Net revenue for the year | 5,631,462 |
Net revenue for the year allocated to NCI | 666,765 |
Loss for the year | (690,648) |
Loss allocated to NCI | (81,772) |
Net decrease in cash and cash equivalents | (11,683,713) |
FIMBank Group Annual Report & Financial Statements 2023
188
Group | Bank | |||
2023 | 2022 | 2023 | 2022 | |
USD | USD | USD | USD | |
Payment commitments to the Depositor Compensation Scheme | 2,811,005 | 2,149,970 | 2,811,005 | 2,149,970 |
Payment commitments to the Single Resolution Fund | 445,474 | 388,680 | 445,474 | 388,680 |
Guarantees issued to banks | 14,687,080 | 4,518,391 | 14,687,080 | 4,518,391 |
Guarantees issued to customers | 13,338,194 | 7,616,051 | 13,338,194 | 7,609,191 |
Guarantees issued to subsidiary companies | - | - | 11,049,724 | 24,004,301 |
31,281,753 | 14,673,092 | 42,331,477 | 38,670,533 |
FIMBank Group Annual Report & Financial Statements 2023
189
Group | Bank | |||
2023 | 2022 | 2023 | 2022 | |
USD | USD | USD | USD | |
Commitments to purchase assets | ||||
Undrawn credit facilities | 72,943,304 | 60,774,694 | 72,943,304 | 60,774,694 |
Confirmed letters of credit | 10,217,120 | 21,083,250 | 10,217,120 | 19,448,466 |
Documentary credits | 17,059,663 | 6,389,064 | 17,059,663 | 6,389,064 |
Risk participations | - | 4,802,199 | - | 4,802,199 |
Commitment to purchase assets | 77,003,510 | 6,952,256 | - | - |
Commitments to sell assets | ||||
Commitment to sell assets | (29,419,890) | - | - | - |
147,803,707 | 100,001,463 | 100,220,087 | 91,414,423 |
Group | Bank | |||
2023 | 2022 | 2023 | 2022 | |
Restated | Restated | |||
USD | USD | USD | USD | |
Balances with the Central Bank of Malta, treasury bills and cash | 221,812,510 | 91,573,516 | 221,799,380 | 91,558,657 |
Loans and advances to banks | 53,246,027 | 20,977,354 | 18,200,076 | 11,418,767 |
Amounts owed to institutions and banks | (162,015,093) | (156,470,539) | (112,269,724) | (93,365,526) |
Cash and cash equivalents at end of year | 113,043,444 | (43,919,669) | 127,729,732 | 9,611,898 |
Adjustment to reflect balances with contractual maturity of more than three months | (19,789,241) | (62,794,336) | 6,094,166 | (53,664,783) |
As per statements of financial position | 93,254,203 | (106,714,005) | 133,823,898 | (44,052,885) |
Analysed as follows: | ||||
Balances with the Central Bank of Malta, treasury bills and cash | 353,010,186 | 216,867,325 | 352,997,057 | 216,852,467 |
Loans and advances to banks | 152,814,948 | 149,713,926 | 114,325,243 | 125,882,432 |
Amounts owed to institutions and banks | (412,570,931) | (473,295,256) | (333,498,402) | (386,787,784) |
93,254,203 | (106,714,005) | 133,823,898 | (44,052,885) |
FIMBank Group Annual Report & Financial Statements 2023
190
Ultimate and immediate | Subsidiaries of immediate | |||
parent companies * | parent company ** | |||
2023 | 2022 | 2023 | 2022 | |
USD | USD | USD | USD | |
Assets | ||||
Loans and advances to customers | 21,917,150 | 39,915,398 | - | - |
Financial investments at amortised cost | 9,771,244 | 9,805,955 | - | - |
Liabilities | ||||
Derivative liabilities held for risk management | - | - | - | 44,026 |
Amounts owed to institutions and banks | - | - | 270,647 | 48,335 |
Amounts owed to customers | 30,830 | 47,294,349 | 2,433 | 2,508 |
Statements of profit or loss | ||||
Interest income | 2,704,809 | 1,803,585 | - | - |
Interest expense | (8,389) | (2,083) | - | (2,194) |
Fee and commission income | 85 | 78 | 7,349 | 8,042 |
Fee and commission expense | (3,046) | (6,957) | - | - |
Net trading results | - | - | 144,018 | (26,311) |
Administrative expenses | - | - | (313,312) | (60,897) |
FIMBank Group Annual Report & Financial Statements 2023
191
Shareholder having significant | Subsidiary of shareholder | |||||
influence | having significant influence | Other related companies | ||||
2023 | 2022 | 2023 | 2022 | 2023 | 2022 | |
USD | USD | USD | USD | USD | USD | |
Assets | ||||||
Loans and advances to banks | 350,751 | 96,550 | - | - | - | - |
Loans and advances to customers | - | - | - | - | 30,000 | 40,414,656 |
Other assets | - | - | - | - | 1,431 | - |
Liabilities | ||||||
Amounts owed to customers | - | - | - | - | 22,092 | 17,111 |
Other liabilities | - | - | - | - | 712 | 687 |
Statements of profit or loss | ||||||
Interest income | - | - | - | - | 145,040 | 1,517,135 |
Interest expense | - | (197,384) | - | (99,783) | - | - |
Fee and commission income | - | - | - | - | 20 | 42,590 |
Fee and commission expense | - | - | - | (51,268) | (15,829) | (4,738) |
Administrative expenses | (11,596) | - | - | - | - | - |
Directors | Executive officers | |||
2023 | 2022 | 2023 | 2022 | |
USD | USD | USD | USD | |
Liabilities | ||||
Amounts owed to customers | 853,071 | 732,829 | 49,567 | 336,545 |
Other liabilities | - | - | - | 1,920 |
Statements of profit or loss | ||||
Interest income | - | - | - | 1 |
Interest expense | (14,075) | (8,752) | (719) | (1,227) |
Fee and commission income | 240 | 240 | 16 | - |
Administrative expenses - remuneration | (388,106) | (415,959) | (2,705,353) | (2,648,004) |
Administrative expenses - other long-term benefits | (391) | (400) | (579,460) | (520,801) |
Administrative expenses - short-term benefits | - | - | (15,113) | - |
Administrative expenses - others | (18,366) | (39,444) | (59,175) | (48,534) |
FIMBank Group Annual Report & Financial Statements 2023
192
Other related parties | ||
2023 | 2022 | |
USD | USD | |
Liabilities | ||
Amounts owed to customers | 468,100 | 342,901 |
Statements of profit or loss | ||
Interest expense | (8,252) | (5,199) |
Group | Bank | |||
2023 | 2022 | 2023 | 2022 | |
USD | USD | USD | USD | |
Authorised and contracted | 205,395 | 170,382 | 200,000 | 120,000 |
Authorised but not contracted | 1,052,983 | 91,596 | 90,000 | 15,998 |
1,258,378 | 261,978 | 290,000 | 135,998 |
Group | Bank | |||
2023 | 2022 | 2023 | 2022 | |
USD | USD | USD | USD | |
Authorised and contracted | 6,028,022 | 6,107,754 | 5,664,108 | 5,346,202 |
Authorised but not contracted | 678,127 | 1,076,717 | 670,116 | 1,068,985 |
6,706,149 | 7,184,471 | 6,334,224 | 6,415,187 |
FIMBank Group Annual Report & Financial Statements 2023
193
48 Ultimate parent company
The ultimate parent company of FIMBank p.l.c. is Kuwait Projects Company (Holding) K.S.C.P. (“KIPCO”) a company registered in Kuwait.
The registered address is KIPCO Tower, Khalid Bin Al Waleed Street, Sharq, Kuwait City.
The immediate parent company is United Gulf Holding Company B.S.C. (“UGH”) , a holding company licensed by the Ministry of Industry,
Commerce and Tourism in Bahrain. The registered address is PO Box 5565, Diplomatic Area, UGB Tower, Manama, Kingdom of Bahrain.
the requirements of International Financial Reporting Standards as adopted by the EU give a true and fair view of the assets, liabilities, financial FIMBank Group Annual Report & Financial Statements 2023 194 Statement by the directors pursuant to Capital Markets For the year ended 31 December 2023 We, the undersigned, declare that to the best of our knowledge, the Financial Statements set out on pages 40 to 193 prepared in accordance with Approved by the Board of Directors and signed on its behalf by John C. Grech (Chairman) and Masaud M.J. Hayat (Vice Chairman) on 24 April 2024 as per Director’s Declaration on ESEF Annual Financial Report submitted in conjunction with the Annual Report and Financial Statements |
position and profit or loss of the Bank and its subsidiaries included in the consolidation taken as a whole and that this report includes a fair review Rule 5.68 |
of the development and performance of the business and the position of the Bank and its subsidiaries included in the consolidation taken as a whole, together with a description of the principal risks and uncertainties that they face. 2023. |
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195
Schedule I
Statements of profit or loss
Five-year summary – Bank
2023
2022
Restated
2021
2020
2019
USD
USD
USD
USD
USD
Interest income
52,818,308
30,248,635
19,588,232
22,721,724
30,311,233
Interest expense
(33,156,902)
(13,509,191) | (10,457,006) | (11,482,001) | (14,037,860) | ||
Net interest income | 19,661,406 | 16,739,444 | 9,131,226 | 11,239,723 | 16,273,373 |
Fee and commission income | 3,116,178 | 2,744,994 | 4,940,843 | 5,366,867 | 7,753,143 |
Fee and commission expense | (1,206,187) | (1,924,794) | (2,165,538) | (2,552,278) | (3,078,283) |
Net fee and commission income | 1,909,991 | 820,200 | 2,775,305 | 2,814,589 | 4,674,860 |
Net trading results
(921,644)
1,411,029
542,868
(554,107)
3,107,935
Net gain/(loss) from equity instruments measured at fair
value
768,541
(337,257)
-
-
-
Dividend income
12,221,863
10,321,545
16,989,049
7,240,817
43,591,794
Other operating income
328,330
566,474
133,940
120,725
118,904
Other operating expenses
(24,531)
(364,205)
(155,943)
-
-
Operating income before net impairment
33,943,956
29,157,230
29,416,445
20,861,747
67,766,866
Net impairment charge on financial assets
(2,993,592)
(17,424,101)
(3,699,557)
(34,272,400)
(14,210,257)
Impairment of investments in subsidiaries
-
(8,261,536)
(87,356)
(9,314,000)
-
Operating income
30,950,364
3,471,593
25,629,532
(22,724,653)
53,556,609
Administrative expenses
(24,824,525)
(22,139,252)
(23,213,366)
(23,722,803)
(20,305,701)
Depreciation and amortisation
(2,828,936)
(2,811,670)
(2,965,967)
(2,962,370)
(2,896,531)
Total operating expenses
(27,653,461)
(24,950,922)
(26,179,333)
(26,685,173)
(23,202,232)
Profit/(Loss) before tax
3,296,903
(21,479,329)
(549,801)
(49,409,826)
30,354,377
Taxation
(806,755)
(530,755)
(113,418)
(6,566,776)
(765,433)
Profit/(Loss) for the year
2,490,148
(22,010,084)
(663,219)
(55,976,602)
29,588,944
FIMBank Group Annual Report & Financial Statements 2023
196
Schedule II
Statements of financial position
Five-year summary – Bank
2023
2022
Restated
2021
Restated
2020
2019
USD
USD
USD
USD
USD
Assets
Balances with the Central Bank of Malta,
treasury bills and cash
352,997,057
216,852,467
239,982,048
319,267,749
208,259,407
Derivative assets held for risk management
812,609
1,610,475
841,688
1,019,288
96,285
Loans and advances to banks
114,325,243
125,882,432
182,458,548
179,364,067
232,351,750
Loans and advances to customers
618,118,225
718,910,427
745,564,139
779,834,360
811,152,849
Financial investments at fair value through profit
or loss
19,329,840
18,179,220
19,966,163
20,385,323
125,342,798
Financial investments at fair value through other
comprehensive income
140,755,780
143,189,022
162,408,542
153,327,686
79,367,556
Financial investments at amortised cost
28,399,073
14,602,008
9,914,754
9,839,457
9,785,496
Investments in subsidiaries
157,687,573
152,687,573
159,448,858
147,436,214
147,948,385
Property and equipment
2,994,784
4,770,241
1,965,249
3,507,509
5,229,059
Intangible assets
2,624,736
3,099,853
3,774,315
4,008,725
4,647,642
Current tax assets
-
-
66,667
76,225
226,886
Deferred tax assets
15,004,834
15,004,834
16,336,538
15,590,954
22,011,162
Other assets
7,747,110
6,830,284
3,848,321
5,570,563
8,824,153
Total assets
1,460,796,864
1,421,618,836
1,546,575,830
1,639,228,120
1,655,243,428
Liabilities and equity
Liabilities
Derivative liabilities held for risk management
626,476
818,031
1,533,556
1,629,434
193,691
Amounts owed to institutions and banks
333,498,402
386,787,784
497,633,356
387,900,641
405,072,025
Amounts owed to customers
951,166,330
869,220,415
838,675,598
1,037,118,337
978,134,002
Provision for liabilities and charges
90,135
121,209
201,775
173,051
85,159
Other liabilities
10,633,538
10,498,948
7,921,481
7,645,488
13,077,128
Total liabilities
1,296,014,881
1,267,446,387
1,345,965,766
1,434,466,951
1,396,562,005
Equity
Share capital
261,221,882
261,221,882
261,221,882
261,221,882
261,221,882
Share premium
858,885
858,885
858,885
858,885
858,885
Reserve for general banking risks
-
-
2,218,995
3,358,738
2,323,486
Fair value reserve
(17,382,450)
(25,501,836)
(1,074,305)
2,413,581
357,233
Other reserve
2,681,041
2,681,041
2,681,041
2,681,041
2,681,041
Accumulated losses
(82,597,375)
(85,087,523)
(65,296,434)
(65,772,958)
(8,761,104)
Total equity
164,781,983
154,172,449
200,610,064
204,761,169
258,681,423
Total liabilities and equity
1,460,796,864
1,421,618,836
1,546,575,830
1,639,228,120
1,655,243,428
Memorandum items
Contingent liabilities
42,331,477
38,670,533
39,327,362
44,246,902
61,628,654
Commitments
100,220,087
91,414,423
107,469,111
105,245,766
143,026,427
FIMBank Group Annual Report & Financial Statements 2023
197
Schedule III
Cash flow statements
Five-year summary – Bank
2023
2022
2021
2020
2019
USD
USD
USD
USD
USD
Net cash flows generated from/(used in)
operating activities
111,619,035
26,554,154
(118,733,012)
61,848,191
28,447,866
Cash flows from investing activities
Payments to acquire financial investments at
fair value through profit or loss
-
-
-
-
(2,469,245)
Payments to acquire financial investments at fair
value through other comprehensive income
-
(25,549,207)
(74,874,050)
(109,616,706)
(84,984,922)
Payments to acquire financial investments at
amortised cost
(13,440,236)
(14,569,219)
-
-
-
Payments to acquire treasury bills at amortised
cost
(288,263,020)
(429,590,021)
-
-
-
Payments to acquire shares in subsidiary
companies
-
(252)
-
(1,801,829)
(5,352,772)
Payments to acquire shares in other investments
-
-
-
-
-
Payments to acquire property and equipment
(34,872)
(916,620)
(399,511)
(142,744)
(372,658)
Payments to acquire intangible assets
(490,433)
(318,308)
(779,881)
(393,096)
(951,219)
Proceeds on disposal of financial investments at
fair value through profit or loss
249,464
127,493
160,770
105,639,259
50,000,000
Proceeds on disposal of financial investments
at fair value through other
comprehensive income
13,745,002
13,000,000
50,918,619
49,246,582
93,035,159
Proceeds on disposal of financial investments at
amortised cost
-
9,800,719
-
-
-
Proceeds on disposal of treasury bills at
amortised cost
288,934,098
296,265,806
-
-
-
Proceeds on disposal of property and equipment
27,500
1,565
9,751
-
3,551
Receipt of dividend
7,221,863
8,821,545
4,889,049
240,817
4,628,411
Net cash flows generated from/(used in)
investing activities
7,949,366
(142,926,499)
(20,075,253)
43,172,283
53,536,305
Cash flows from financing activities
Issue of share capital
-
-
-
-
84,887
Net movement in debt securities
-
-
-
-
(14,834,943)
Payment of lease liabilities
(1,450,567)
(1,330,082)
(1,787,096)
(997,729)
(2,354,026)
Net cash flows used in financing activities
(1,450,567)
(1,330,082)
(1,787,096)
(997,729)
(17,104,082)
Increase/(Decrease) in cash and cash equivalents
118,117,834
(117,702,427)
(140,595,361)
104,022,745
64,880,089
Cash and cash equivalents at beginning of year
9,611,898
127,314,325
267,909,686
163,886,941
99,006,852
Cash and cash equivalents at end of year
127,729,732
9,611,898
127,314,325
267,909,686
163,886,941
FIMBank Group Annual Report & Financial Statements 2023
198
Schedule IV
Accounting ratios
Five-year summary – Bank
2023
2022
2021
2020
2019
%
%
%
%
%
Net interest income and other operating income to total assets
1.37
2.21
2.05
1.43
4.28
Operating expenses to total assets
(1.89)
(1.76)
(1.69)
(1.63)
(1.40)
Profit/(Loss) before tax to total assets
0.23
(1.51)
(0.04)
(3.01)
1.83
Pre-tax return on capital employed
2.00
(13.93)
(0.27)
(24.13)
11.73
Profit/(Loss) after tax to equity
1.51
(14.28)
(0.33)
(27.34)
11.44
2023
2022
2021
2020
2019
Weighted average number of shares in issue (000’s)
522,444
522,444
522,444
522,444
514,568
Net assets per share (US cents)
31.54
29.51
38.40
39.19
50.27
Basic earnings per share (US cents)
0.48
(4.21)
(0.13)
(10.71)
5.75
FIMBank Group Annual Report & Financial Statements 2023
199
Directors and executive management
Board of Directors John C. Grech (Chairman)
Masaud M.J. Hayat (Vice Chairman)
Edmond Brincat
Erich Schumacher
Hussain Abdul Aziz Lalani
Mohammed Louhab
Rabih Soukarieh
Sunny Bhatia
Company Secretary Andrea Batelli
Registered Address Mercury Tower
The Exchange Financial and Business Centre
Elia Zammit Street
St. Julian’s STJ 3155
MALTA
Contact Number Tel: +356 2132 2100
Executive Management
FIMBank p.l.c.
Group Chief Executive Officer Mohammed Louhab
First Executive Vice President Simon Lay Deputy Chief Executive Officer
Executive Vice Presidents Adrian A. Gostuski Advisor to the CEO (Resigned on 6 April 2024)
Andrea Batelli Group General Counsel,
Head of Investor Relations & Company Secretary
Christine Coleiro Group Chief Human Resources Officer
Juraj Beno Group Chief Financial Officer
Modesto Luengo Group Chief Risk Officer
Ronald Haverkorn Advisor to the GCEO
Thomas Dodd Group Chief Compliance Officer & MLRO
London Forfaiting Company Limited
Chief Executive Officer Simon Lay
Company Secretary William Ramzan Chief Financial Officer
India Factoring and Finance Solutions (Private) Limited
Chief Executive Officer Ravi Valecha
Company Secretary Swati Zawar Manager – Compliance
The Egyptian Company for Factoring S.A.E.
Chief Executive Officer Ahmed Shaheen
Company Secretary Mohamed Gamaleldien Head of Legal
Independent auditor’s report
To the Shareholders of FIMBank p.l.c.
Report on the audit of the financial statements
Our opinion
In our opinion:
● The Group financial statements and the Parent Company (“the Bank”) financial statements (the “financial statements”) of FIMBank p.l.c. give a true and fair view of the Group and the Parent Company’s financial position as at 31 December 2023, and of their financial performance and cash flows for the year then ended in accordance with International Financial Reporting Standards (‘IFRSs’) as adopted by the EU; and
● The financial statements have been prepared in accordance with the requirements of the Maltese Banking Act (Cap. 371) and the Maltese Companies Act (Cap. 386).
Our opinion is consistent with our additional report to the Audit Committee.
What we have audited
FIMBank p.l.c.’s financial statements comprise:
● the Consolidated and Parent Company statements of financial position as at 31 December 2023;
● the Consolidated and Parent Company statements of profit or loss and statements of other comprehensive income for the year then ended;
● the Consolidated and Parent Company statements of changes in equity for the year then ended;
● the Consolidated and Parent Company statements of cash flows for the year then ended; and
● the notes to the financial statements, comprising material accounting policy information and other explanatory information.
Basis for opinion
We conducted our audit in accordance with International Standards on Auditing (ISAs). Our responsibilities under those standards are further described in the Auditor’s Responsibilities for the Audit of the Financial Statements section of our report.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Independence
We are independent of the Group and the Bank in accordance with the International Code of Ethics for Professional Accountants (including International Independence Standards) issued by the International Ethics Standards Board for Accountants (IESBA Code) together with the ethical requirements of the Accountancy Profession (Code of Ethics for Warrant Holders) Directive issued in terms of the Accountancy Profession Act (Cap. 281) that are relevant to our audit of the financial statements in Malta. We have fulfilled our other ethical responsibilities in accordance with these Codes.
To the best of our knowledge and belief, we declare that non-audit services that we have provided to the Bank and its subsidiaries are in accordance with the applicable law and regulations in Malta and that we have not provided non-audit services that are prohibited under Article 18A of the Accountancy Profession Act (Cap. 281).
The non-audit services that we have provided to the Bank and its subsidiaries, in the period from 1 January 2023 to 31 December 2023 are disclosed in note 16 to the financial statements.
Our audit approach
Overview
|
|
● Overall group materiality: USD1,793,000, which represents 1% of net assets. |
|
● The group audit engagement team performed a full scope audit on the financial statements of the Bank and FIM Property Investment Limited, which is one of the Bank’s subsidiaries, and performed specified audit procedures on certain account balances of London Forfaiting Company Limited. ● The other two significant components, namely FIMFactors B.V. (and its subsidiary India Factoring and Finance Solutions Private Ltd) and The Egyptian Company for Factoring S.A.E., were audited by other auditors. ● The group audit engagement team performed oversight procedures on the work of other auditors. |
|
|
● Credit loss allowances in respect of loans and advances to customers of the Group and Bank ● Valuation of the Group’s trading assets measured at fair value ● Recoverability of deferred tax assets of the Group and Bank |
As part of designing our audit, we determined materiality and assessed the risks of material misstatement in the consolidated financial statements. In particular, we considered where the directors made subjective judgements; for example, in respect of significant accounting estimates that involved making assumptions and considering future events that are inherently uncertain. As in all of our audits, we also addressed the risk of management override of internal controls, including among other matters consideration of whether there was evidence of bias that represented a risk of material misstatement due to fraud.
Materiality
The scope of our audit was influenced by our application of materiality. An audit is designed to obtain reasonable assurance whether the financial statements are free from material misstatement. Misstatements may arise due to fraud or error. They are considered material if individually or in aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of the consolidated financial statements.
Based on our professional judgement, we determined certain quantitative thresholds for materiality, including the overall group materiality for the consolidated financial statements as a whole as set out in the table below. These, together with qualitative considerations, helped us to determine the scope of our audit and the nature, timing and extent of our audit procedures and to evaluate the effect of misstatements, both individually and in aggregate on the financial statements as a whole.
|
Overall group materiality |
USD1,793,000 |
|
How we determined it |
1% of net assets |
|
Rationale for the materiality benchmark applied |
We chose net assets as the benchmark in view of the volatility of the Group’s profit before tax over the past five years. Moreover, in our view, the actual return attributable to equity holders is dependent on the adequacy of the Group’s capitalisation in view of the regulatory restrictions in respect of dividend distributions, while also being a generally accepted benchmark. In this respect, we considered net assets to be more reflective of the financial position and financial performance of the Group. We chose 1% which is within the range of quantitative materiality thresholds that we consider acceptable. |
We agreed with the Audit Committee that we would report to them misstatements identified during our audit above USD89,650 as well as misstatements below that amount that, in our view, warranted reporting for qualitative reasons.
Key audit matters
Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of the financial statements of the current period. These matters were addressed in the context of our audit of the financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters.
|
Key audit matter |
How our audit addressed the Key audit matter |
|
Credit loss allowances in respect of loans and advances to customers of the Group and Bank
Credit loss allowances in respect of loans and advances to customers represent management’s best estimate of expected credit losses (‘ECLs’) within the loan portfolios at the balance sheet date. The Group has four lending portfolios: · the Local Corporate Lending portfolio, predominantly comprising loans to entities within the real estate sector in Malta; · the Factoring Receivables portfolio, consisting of factored receivables (both on a non-recourse and recourse basis) originated in Europe, India and the Middle East; · the Trade Finance portfolio, comprising import and export finance facilities originated in Europe; and · a portfolio of other facilities including syndicated senior secured facilities to international corporates and shipping finance facilities. The measurement of ECLs in respect of loans and advances to customers requires a considerable level of judgement since the determination of ECLs is subject to a high degree of estimation uncertainty. In this respect, it is considered a key area of focus. The level of estimation uncertainty surrounding the measurement of ECLs in respect of the Group’s lending portfolios remained elevated during the financial year ended 31 December 2023 in view of the inflationary pressures and interest rate environment experienced internationally, as well as the geopolitical tensions as a result of the ongoing military conflict in Eastern Europe and escalation of hostility within the Middle East. This affected a number of components forming part of the ECL calculation, including the determination of staging, the modelling of expected default levels and loss severities, and the determination of forward-looking scenarios giving rise to heightened subjectivity requiring a higher level of expert judgement. Credit loss allowances relating to all loans and advances to customers are determined at an instrument level. Significant judgement is required in the development and/or calibration of the models designed to estimate ECLs on loans measured at amortised cost in accordance with the requirements of IFRS 9, which has become more pronounced due to the macroeconomic conditions being experienced and the complexities in the modelling aspects of the ECL calculation. In general, the Group calculates ECL by using the following key inputs: probability of default (PD), loss given default (LGD) and exposure at default (EAD). The maximum period considered when measuring ECL is the maximum period over which the Group is exposed to credit risk. In this respect, the EAD for exposures within the Group’s portfolios is based on contractual maturity. For non-defaulted (Stages 1 and 2) exposures, the Group uses a model developed by an external vendor in which key risk parameters, including both PDs and LGDs, are estimated using statistical models mainly by benchmarking exposure-specific characteristics against an underlying dataset. Specifically, the PDs and LGDs attributable to financial assets within the Group’s lending portfolios are determined by reference to the default and loss history of comparable borrowers with similar characteristics in terms of size, industry, country of operation and financial soundness of the borrower. PDs are computed taking cognisance of quantitative and qualitative model inputs, which are used to generate a borrower-specific credit score. For exposures classified within the Local Corporate Lending portfolio, the credit score is determined by reference to inputs related to the project being financed, such as the property type, property valuation upon completion, project costs and project complexity, whereas the credit scores for exposures classified within the Trade Finance portfolio, as well as syndicated and shipping finance loans, are determined by reference to financial statement inputs and other qualitative inputs, comprising the entity’s competitive position in the market and customer concentration level. Similarly, credit scores for exposures classified within the Factoring Receivables portfolio are computed using internally developed scorecards taking into account quantitative (for instance sales growth and net worth of the entity) and qualitative (such as industry and market conditions) inputs. Credit scores are then mapped to a rating scale, on the basis of which a Through-The-Cycle (‘TTC’) PD is assigned to each borrower. The rating scale to PD matrix is calibrated by reference to historical market default data sourced from external credit rating agencies. Accordingly, the Group’s ECL model estimates TTC PDs at a borrower level by benchmarking model inputs against those attributable to peers with similar credit risk characteristics and operating in the same industry. TTC PDs are then adjusted using a macroeconomic modelling tool to first reflect current macroeconomic conditions (deriving an unconditional Point-in-Time or PiT PD) and then to simulate the PD under multiple macroeconomic forecasts developed by the external vendor (deriving a conditional PiT PD). Similarly, the unsecured LGD is estimated at a facility level by benchmarking facility-specific model inputs against observed losses for facilities which are similar in nature. In this respect, the model is principally driven by the nature of the exposure (term vs. revolver), the relative ranking of the facility in the borrower’s capital structure, the country and industry in which the borrower operates, together with the borrower-specific PD. Secured loans and advances to customers are primarily secured by residential and/or commercial real estate, as well as cash pledges and, in the case of certain exposures within the Factoring Receivables portfolio, credit insurance cover purchased from foreign third party underwriters which provide cover in respect of losses up to a pre-determined percentage of each eligible receivable. In this respect, the secured LGD is derived through the application of adjustments to the unsecured LGD to reflect the collateral value after taking into consideration pre-determined haircuts. The same macroeconomic modelling elements used to transform TTC PDs to PiT PDs are then used to convert the TTC LGDs to conditional PiT LGDs. In this regard, macroeconomic conditioning is applied to the LGD term structure through a modelled correlation between PD and LGD term structures. Estimation uncertainty is particularly relevant in relation to the level of subjectivity and expert judgement required to develop macroeconomic forecasts to capture the potential movement in default levels and loss severities under multiple forward-looking scenarios. Specifically, the Group applies three macroeconomic scenarios to capture the current economic environment, reflecting management’s view of the range of potential outcomes. In this respect, the current economic conditions induce additional elements of complexity in determining the severity and likelihood of macroeconomic forecasts used in the Group’s ECL calculation across different countries and the extent to which these potential scenarios will impact PiT PD and LGD parameters. Staging is determined based on a combination of quantitative and qualitative criteria. Quantitative criteria comprise a comparison of model-calculated PDs/implied ratings as at reporting date with the calculated PDs/implied ratings upon origination. For exposures classified within the Local Corporate Lending portfolio as well as syndicated and shipping finance facilities, qualitative criteria for staging purposes are based on aspects such as the regular monitoring of the financial performance of borrowers and developments affecting the borrowers’ future abilities to repay. Factored receivables and Trade Finance facilities are not managed on a credit by credit basis due to the high volume of homogeneous exposures. In this respect, the Group’s internal credit risk management framework designed to identify Significant Increase in Credit Risk (‘SICR’) and Unlikeliness-to-Pay (‘UTP’) events in respect of such exposures is primarily based on delinquency. The Group applies a set of SICR and UTP criteria to determine staging on a qualitative basis, which require a significant element of judgement. For loans which are classified as Stage 3 (defaulted) exposures, judgement is required to estimate the expected future cash flows related to that loan. In this regard, the ECL calculation for defaulted exposures is driven by a process based on an internally developed discounted cash flow methodology. The measurement of ECLs for Stage 3 exposures is therefore dependent on parameters and assumptions including the estimation of cash flows under multiple scenarios, the determination of borrower-specific discount rates, and the weighting assigned to each scenario. Estimated future cash flows are generally based on parameters or assumptions around borrowers’ operating cash flows, judgements around the possible outcome of litigation and/or liquidation proceedings and out-of-court settlements, and recoveries through the sale or repossession of collateral to determine a probability weighted recoverable amount of the loan. In view of the above matters, the risk of misstatement in the estimation of ECLs in respect of Stage 3 loans and advances to customers, which is subjective in nature and inherently judgemental in respect of both timing of recognition of impairment and the estimation of the size of any such impairment, remains high. Accordingly, summarising the key areas relevant to the Group’s measurement of ECLs would include: · Allocation of exposures to stage 1, 2, or 3 using criteria in accordance with IFRS 9; · Accounting interpretations and modelling assumptions used to build the models that calculate the ECL; · Completeness and accuracy of data used to calculate the ECL; · Inputs and assumptions used to estimate the impact of multiple macroeconomic scenarios; and · Measurements of individually assessed provisions including the assessment of multiple scenarios.
Relevant references in the Annual Report and Financial Statements: · Accounting policy: Note 3.9; · Note on Net movement in expected credit losses and other credit impairment charges: Note 5; · Credit risk: Note 5.2; and · Note on Loans and advances to customers: Note 23.
|
During our audit of the financial statements for the year ended 31 December 2023, we focused on the key drivers of the estimation of ECL. In this respect, we evaluated and tested the appropriateness of management assumptions and key parameters. Discussions with the Audit Committee included:
In respect of the Group’s ECL models used for estimating credit loss allowances attributable to non-defaulted exposures, the appropriateness of the modelling methodology used was independently assessed by reference to the requirements of IFRS 9. In addition, the appropriateness of the key assumptions used in, and the conceptual soundness of, the adapted discounted cash flow model utilised for the estimation of credit loss allowances attributable to defaulted exposures were similarly assessed, particularly the methodology used to determine forecasted operating cash flows.
We understood and critically assessed the model used by the Group to measure expected credit loss allowances on exposures classified within Stages 1 and 2. Our audit approach focused specifically on:
For the purpose of obtaining comfort on the credit loss allowances for Stage 1 and 2 exposures within the Group’s lending portfolios, emanating from a vendor model, we carried out the following substantive procedures: · Performed an overall assessment of the ECL provision levels by stage to determine if they were reasonable considering the Group’s portfolio, risk profile, credit risk management practices and the macroeconomic environment. · Tested a sample of exposures classified within the Local Corporate Lending portfolio, as well as syndicated and shipping finance facilities, to independently review the borrower’s financial performance and ability to meet loan repayments, and assess the appropriateness of the internal credit rating assigned by management. · Challenged the criteria used to allocate an asset to stage 1, 2 or 3 in accordance with IFRS 9 and tested assets in stage 1, 2 and 3 to verify that they were allocated to the appropriate stage. · Tested the completeness and accuracy of certain instrument-specific model data inputs utilised within the models for the purposes of the year end ECL calculation.
ECL calculation for defaulted
exposures For Stage 3 exposures, the appropriateness of provisioning methodologies and policies was independently assessed. For Stage 3 loans, we performed tests of detail to review and challenge the Group’s estimate of credit loss allowances, in light of the latest information on the borrower, together with the appropriateness of key parameters used. An independent view was formed on the level of credit loss allowances recorded based on the detailed loan and customer information available. Substantive procedures were performed on defaulted exposures in respect of the estimation of the size of the respective ECL provisions, as follows: · Reviewed the credit files of loans and advances classified within stage 3 to understand the latest developments at the level of the borrower and the basis of measuring the ECL provisions and considered whether key judgements (such as the appropriateness of the timing and level of expected cash flows by reference to the current status of litigation / liquidation proceedings) were appropriate given the borrowers’ circumstances. · Assessed the discount rate used to determine the present value of discounted cash flows. · Challenged the appropriateness of the Group’s methodology in respect of scenarios applied for the exposures referred to above, particularly in respect of the extent to which the Group considers multiple scenarios in determining the recoverability of stage 3 loans, by forming an independent view of the recoverability of stage 3 loans under different scenarios. · Tested the accuracy of key inputs and reperformed the impairment calculation used to derive expected cash flows under different scenarios. · Reviewed the perfection of collateral in line with the Group’s policy, where the exposure is secured by immovable property.
|
|
Valuation of the Group’s trading assets measured at fair value
At 31 December 2023, the Group’s assets included trading assets measured at fair value through profit or loss amounting to $374.2 million. These assets are not actively traded and, as such, are not quoted in an established market. The fair valuation of trading assets is determined through the application of an internally developed valuation model that involves the exercise of judgement and the use of assumptions based on limited observable market data. Key inputs used in the valuation methodology to discount expected future cash flows comprise: · instrument specific characteristics used to determine credit spreads, including counterparty creditworthiness and transaction currency; and · market risk-free rates determined by reference to contractual terms as well as interest rates observed in the market at reporting date. The Group’s trading assets are classified as Level 3 instruments in the fair value hierarchy given that their fair value is determined by reference to significant unobservable inputs. In this respect, the valuation of trading assets is deemed to represent a key audit matter. Relevant references in the Annual Report and Financial Statements: · Accounting policy: Note 3.9; and · Note on Trading assets: Note 21.
|
We involved our valuation experts, as appropriate, in performing our procedures in relation to the trading assets. As part of those procedures: · we evaluated the appropriateness of the valuation methodology used by the Group to determine the fair value of the trading assets; · we assessed the reasonableness of discount rates applied in the internally developed discounted cash flow model to determine the fair value of trading assets at reporting date. Specifically: o we assessed whether the instrument-specific credit spreads were within an appropriate range by reference to movements in instrument-specific external ratings (where available) and country external ratings on a sample basis; o we tested the appropriateness of market risk-free rates applied by the Group for the determination of discount rates to be used for the fair valuation of trading assets at reporting date across the portfolio; and · we tested the accuracy of inputs used in the discounted cash flow model at reporting date for a sample of assets by agreeing key inputs to contractual agreements; and · we determined the fair value of a sample of trading assets independently by reference to the discount rates assessed as outlined previously. In addition to the above, we also: · assessed the reasonableness of the Group’s valuation methodology by performing backtesting by reference to realised gains or losses on disposals of trading assets during the financial year ended 31 December 2023; and · recomputed realised fair value gains/losses for a sample of disposals. We also reviewed the appropriateness of the disclosures in respect of fair values of the trading assets in accordance with the requirements of IFRS 13. Based on the work performed, the valuation methodology as well as the assumptions and inputs used in the fair valuation of trading assets appear to be reasonable. In addition, the related disclosures are deemed to be appropriate.
|
|
Recoverability of deferred tax assets of the Group and Bank
At 31 December 2023, the Group and Bank had recognised deferred tax assets amounting to $19.0 million and $15.0 million respectively. The deferred tax assets are predominantly related to unutilised tax losses attributable to the Bank and one of its subsidiaries, India Factoring and Finance Solutions Private Ltd. In accordance with the requirements of IFRSs as adopted by the EU, deferred tax assets are recognised only to the extent that it is probable that future taxable profits will be available, against which these tax benefits can be utilised. The recognition of deferred tax assets therefore requires significant judgement in estimating future taxable profits based on profit forecasts drawn up by management at the reporting date. The amount of deferred tax assets recognised in the financial statements is expected to be recovered within the foreseeable future. Such estimation uncertainty might lead to material differences between the projected period for utilisation of tax losses compared to actual timing of utilisation. In this respect, this area has been deemed to represent a key audit matter. Relevant references in the Annual Report and Financial Statements: · Accounting policy: Note 3.8; and · Note on Deferred taxation: Note 32.
|
As part of our audit procedures: · we reviewed the profitability projections prepared by management and evaluated the assumptions utilised in the preparation of taxable profit forecasts at the reporting date with reference to our understanding of the Group’s and Bank’s business, historical trends, and relevant documentation on the Group’s and Bank’s business strategy over the foreseeable future; · we reviewed the computation of taxable profits within the projections on the basis of tax laws (and tax rates) enacted by the reporting date and the expected utilisation of tax losses, and assessed whether these tax losses are expected to be utilised within a reasonable timeframe; and · we evaluated the adequacy of disclosures made in Notes 17 and 32 to the financial statements, including those regarding key assumptions. Based on the work performed, the carrying amount of deferred tax assets, as well as the related disclosures, appear to be consistent with the explanations and evidence obtained. |
How we tailored our group audit scope
The Group is composed of six components: FIMBank p.l.c. (the “Parent Company” or “Bank”), and its subsidiaries FIM Property Investment Limited, London Forfaiting Company Ltd, FIMFactors B.V. (and its subsidiary India Factoring and Finance Solutions Private Ltd) and The Egyptian Company for Factoring S.A.E., which are determined to be financially significant entities. The figures of FIM Business Solutions Limited are deemed to be immaterial in the context of the Group results.
We tailored the scope of our audit in order to perform sufficient work to enable us to provide an opinion on the financial statements as a whole, taking into account the structure of the Group, the accounting processes and controls, and the industry in which the Group operates.
The group audit engagement team carried out a full scope audit on the Bank and one of the Bank’s subsidiaries located in Malta, namely FIM Property Investment Limited. The group audit engagement team also performed specified audit procedures on certain account balances of another financially significant component, namely London Forfaiting Company Limited.
The financial statements of FIMFactors B.V. (and its subsidiary India Factoring and Finance Solutions Private Ltd) and The Egyptian Company for Factoring S.A.E. (the remaining subsidiaries within the Group), predominantly based in India and Egypt respectively, were audited by other auditors. In this respect, we issued instructions to the other auditors auditing these two components.
In establishing the overall audit approach to the Group audit, we determined the type of work that needed to be performed by us, as the Group audit engagement team, or by other auditors. For the work performed by other auditors operating under our instructions, we determined the level of involvement we needed to have in the audit work at those locations to be satisfied that sufficient audit evidence had been obtained for the purposes of our opinion. We ensured that our involvement in the work of other auditors, together with the additional procedures performed at the Group level, were sufficient to allow us to conclude on our opinion on the Group’s consolidated financial statements as a whole.
The audit engagement team of the Group performed all of this work by applying the overall materiality at the level of the Group’s consolidated financial statements, together with additional procedures performed on the consolidation. This gave us sufficient appropriate audit evidence for our opinion on the consolidate financial statements as a whole.
Other information
The directors are responsible for the other information. The other information comprises all of the information presented in the Annual Report and Financial Statements 2023 (but does not include the financial statements and our auditor’s report thereon).
Our opinion on the financial statements does not cover the other information and we do not express any form of assurance conclusion thereon except as explicitly stated within the Report on other legal and regulatory requirements.
In connection with our audit of the financial statements, our responsibility is to read the other information identified above and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit, or otherwise appears to be materially misstated.
If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.
Responsibilities of the directors and those charged with governance for the financial statements
The directors are responsible for the preparation of financial statements that give a true and fair view in accordance with IFRSs as adopted by the EU and the requirements of the Maltese Banking Act (Cap. 371) and the Maltese Companies Act (Cap. 386), and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.
In preparing the financial statements, the directors are responsible for assessing the Group’s and the Bank’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the Group or the Bank or to cease operations, or have no realistic alternative but to do so.
Those charged with governance are responsible for overseeing the Group’s financial reporting process.
Auditor’s responsibilities for the audit of the financial statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.
As part of an audit in accordance with ISAs, we exercise professional judgement and maintain professional scepticism throughout the audit. We also:
● Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
● Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Group’s and the Bank’s internal control.
● Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the directors.
● Conclude on the appropriateness of the directors’ use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Group’s or the Bank’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s report. However, future events or conditions may cause the Group or the Bank to cease to continue as a going concern.
● Evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation.
● Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities within the Group to express an opinion on the consolidated financial statements. We are responsible for the direction, supervision and performance of the group audit. We remain solely responsible for our audit opinion.
We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.
We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, actions taken to eliminate threats or safeguards applied.
From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the financial statements of the current period and are therefore the key audit matters. We describe these matters in our auditor’s report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.
Report on other legal and regulatory requirements
Report on compliance with the requirements of the European Single Electronic Format Regulatory Technical Standard (the “ESEF RTS”), by reference to Capital Markets Rule 5.55.6
We have undertaken a reasonable assurance engagement in accordance with the requirements of Directive 6 issued by the Accountancy Board in terms of the Accountancy Profession Act (Cap. 281) - the Accountancy Profession (European Single Electronic Format) Assurance Directive (the “ESEF Directive 6”) on the Annual Financial Report of FIMBank p.l.c. for the year ended 31 December 2023, entirely prepared in a single electronic reporting format.
Responsibilities of the directors
The directors are responsible for the preparation of the Annual Financial Report, including the consolidated financial statements and the relevant mark-up requirements therein, by reference to Capital Markets Rule 5.56A, in accordance with the requirements of the ESEF RTS.
Our responsibilities
Our responsibility is to obtain reasonable assurance about whether the Annual Financial Report, including the consolidated financial statements and the relevant electronic tagging therein, complies in all material respects with the ESEF RTS based on the evidence we have obtained. We conducted our reasonable assurance engagement in accordance with the requirements of ESEF Directive 6.
Our procedures included:
● Obtaining an understanding of the entity's financial reporting process, including the preparation of the Annual Financial Report, in accordance with the requirements of the ESEF RTS.
● Obtaining the Annual Financial Report and performing validations to determine whether the Annual Financial Report has been prepared in accordance with the requirements of the technical specifications of the ESEF RTS.
● Examining the information in the Annual Financial Report to determine whether all the required taggings therein have been applied and whether, in all material respects, they are in accordance with the requirements of the ESEF RTS.
We believe that the evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Opinion
In our opinion, the Annual Financial Report for the year ended 31 December 2023 has been prepared, in all material respects, in accordance with the requirements of the ESEF RTS.
Other reporting requirements
The Annual Report and Financial Statements 2023 contains other areas required by legislation or regulation on which we are required to report. The Directors are responsible for these other areas.
The table below sets out these areas presented within the Annual Financial Report, our related responsibilities and reporting, in addition to our responsibilities and reporting reflected in the Other information section of our report. Except as outlined in the table, we have not provided an audit opinion or any form of assurance.
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Area of the Annual Report and Financial Statements 2023 and the related Directors’ responsibilities |
Our responsibilities |
Our reporting |
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Directors’ report The Maltese Companies Act (Cap. 386) requires the directors to prepare a Directors’ report, which includes the contents required by Article 177 of the Act and the Sixth Schedule to the Act. |
We are required to consider whether the information given in the Directors’ report for the financial year for which the financial statements are prepared is consistent with the financial statements. We are also required to express an opinion as to whether the Directors’ report has been prepared in accordance with the applicable legal requirements. In addition, we are required to state whether, in the light of the knowledge and understanding of the Bank and its environment obtained in the course of our audit, we have identified any material misstatements in the Directors’ report, and if so to give an indication of the nature of any such misstatements.
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In our opinion: · the information given in the Directors’ report for the financial year for which the financial statements are prepared is consistent with the financial statements; and · the Directors’ report has been prepared in accordance with the Maltese Companies Act (Cap. 386).
We have nothing to report to you in respect of the other responsibilities, as explicitly stated within the Other information section. |
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Statement of compliance with the principles of good corporate governance The Capital Markets Rules issued by the Malta Financial Services Authority require the directors to prepare and include in the Annual Financial Report a Statement of Compliance with the Code of Principles of Good Corporate Governance within Appendix 5.1 to Chapter 5 of the Capital Markets Rules. The Statement’s required minimum contents are determined by reference to Capital Markets Rule 5.97. The Statement provides explanations as to how the Bank has complied with the provisions of the Code, presenting the extent to which the Bank has adopted the Code and the effective measures that the Board has taken to ensure compliance throughout the accounting period with those Principles.
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We are required to report on the Statement of Compliance by expressing an opinion as to whether, in light of the knowledge and understanding of the Bank and its environment obtained in the course of the audit, we have identified any material misstatements with respect to the information referred to in Capital Markets Rules 5.97.4 and 5.97.5, giving an indication of the nature of any such misstatements. We are also required to assess whether the Statement of Compliance includes all the other information required to be presented as per Capital Markets Rule 5.97. We are not required to, and we do not, consider whether the Board’s statements on internal control included in the Statement of Compliance cover all risks and controls, or form an opinion on the effectiveness of the Bank’s corporate governance procedures or its risk and control procedures. |
In our opinion, the Statement of Compliance has been properly prepared in accordance with the requirements of the Capital Markets Rules issued by the Malta Financial Services Authority.
We have nothing to report to you in respect of the other responsibilities, as explicitly stated within the Other information section. |
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Remuneration report The Capital Markets Rules issued by the Malta Financial Services Authority require the directors to prepare a Remuneration report, including the contents listed in Appendix 12.1 to Chapter 12 of the Capital Markets Rules. |
We are required to consider whether the information that should be provided within the Remuneration report, as required in terms of Appendix 12.1 to Chapter 12 of the Capital Markets Rules, has been included. |
In our opinion, the Remuneration report has been properly prepared in accordance with the requirements of the Capital Markets Rules issued by the Malta Financial Services Authority. |
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Other matters prescribed by the Maltese Banking Act (Cap. 371) In terms of the requirements of the Maltese Banking Act (Cap. 371), we are also required to report whether: ● we have obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purpose of our audit; ● proper books of account have been kept by the Bank, so far as appears from our examination of those books; ● the Bank’s financial statements are in agreement with the books of account; ● in our opinion, and to the best of our knowledge and according to the explanations given to us, the financial statements give the information required by any law which may from time to time be in force in the manner so required. |
In our opinion: · we have obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purpose of our audit; · proper books of account have been kept by the Bank, so far as appears from our examination of those books; · the Bank’s financial statements are in agreement with the books of account; and · to the best of our knowledge and according to the explanations given to us, the financial statements give the information required by any law in force in the manner so required. |
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Other matters on which we are required to report by exception We also have responsibilities under the Maltese Companies Act (Cap. 386) to report to you if, in our opinion, adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us. We also have responsibilities under the Capital Markets Rules to review the statement made by the directors that the business is a going concern together with supporting assumptions or qualifications as necessary. |
We have nothing to report to you in respect of these responsibilities. |
Other matter – use of this report
Our report, including the opinions, has been prepared for and only for the Bank’s shareholders as a body in accordance with Article 179 of the Maltese Companies Act (Cap. 386) and for no other purpose. We do not, in giving these opinions, accept or assume responsibility for any other purpose or to any other person to whom this report is shown or into whose hands it may come save where expressly agreed by our prior written consent.
Appointment
We were first appointed as auditors of the Group and Bank by a directors’ resolution on 17 January 2024 for the year ended 31 December 2023.
Fabio Axisa
Principal
For and on behalf of
PricewaterhouseCoopers
78, Mill Street
Zone 5, Central Business District
Qormi
Malta
24 April 2024