UNAUDITED HALF YEAR FINANCIAL STATEMENT FOR …jaizbankplc.com/uploads/UNAUDITED HALF YEAR FINANCIAL...

UNAUDITED HALF YEAR FINANCIAL STATEMENT FORJAIZ BANK PLC

JUNE 2017

INTRODUCTION

Jaiz Bank PLC Unaudited half year Financial Statement as at 30th, June 2017 complies with the applicablelegal requirements of the Nigerian Securities and Exchange Commission regarding interim financialstatements.

These financial statements are in accordance to the standards applicable to Islamic Banking Operationsand procedures as well as IAS 34 ‘Interim Financial Reporting’ its interpretation issued by the InternationalAccounting Standards and adopted by the Financial Reporting Council of Nigeria.

JAIZ BANK

STATEMENT OF FINANCIAL POSITIONAS AT 30 JUNE 2017

2017 2016Notes N'000 N'000

AssetsCash and Balance with Central Bank of Nigeria 3 18,365,037 22,679,788Due from Banks and Financial Institution 4 10,199,247 2,978,279

0 0 1,054,247 -Sukuk 5 958,795 1,154,621Murabaha Recievables 6 - 1,755,357 - 2,004,051Investment in Musharaka 7 1,191,178 1,193,500Investment in Qard Hassan 8 118,903 205,618Investment in Istisna 9a 792,478 426,915Investment in Ijarah 10 14,080,958 13,394,272Investment in Salam 10b 18,679 -Investment in Asset Held for Sale 11 1,971,608 330,712Property, Plant and Equipment 12 1,934,254 1,635,267Leasehold Improvement 13 23,818 38,939Intangible Assets 14 563,242 495,495Other Assets 15 9,331,446 6,090,223

0 0 1,772,577 1,566,003Total Assets 60,621,109 50,185,581

Liabilities

Customer Current Deposit (17a) 31,046,083 18,833,132Other Financing 18a - 996,635Other Liabilities 18b 6,702,698 2,371,866

Equity of Investment Account HoldersFinancial Institutions' Investment Accounts - -Customers' Unrestricted Investment Accounts (17b) 25,020,847 27,629,873Mudaraba Term Deposit (17c) 2,190,085 -

27,210,932 27,629,873Owners' Equity

Share Capital 19 14,732,125 11,829,700Share Premium 20 627,365 632,289Retained Earnings 21 (1,635,418) (1,313,143)Risk Regulatory reserve 22 1,360,774 115,465Statutory Reserve 22i 93,391 -Total Equity 15,178,237 11,264,311

Total Equity and Liabilities 42,389,169 38,894,184

Hassan Usman, FCA Abdullahi Usman, FCAManaging Director/CEO Chief Financial OfficerFRC/2013/ICAN/00000003984 FRC/2017/ICAN/00000016235

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JAIZ BANK

STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOMEFOR THE YEAR ENDED 30 JUNE 2017

2017 2016Notes N'000 N'000

Income:Income from Financing Investment 23 2,953,243 2,464,647Income from Sukuk 24 293,348 98,351Gross Income from Islamic fiancing transactions 3,246,591 2,562,998

Return on Equity of Investment Account Holders 25(i) (586,456) (571,155)Bank's share as a Mudarib/Equity investor 25(ii) 2,660,135 1,991,843Impairment charges against non-performing FinancingInvestment 32 (170,000) (63,497)

Fee and commisssion 26 590,383 185,912Other Operating Income 27 - -Non Trading Exchange (Loss)/Gain 28 - -Total Income 3,080,518 2,114,258

Expenses:

Staff costs 29 1,106,952 992,831Depreciation and Amortisation 30 277,423 246,396Other Expenses 31 1,225,950 760,991Total Expenses 2,610,325 2,000,218

Operating Profit/(Loss) 470,193 114,040Profit/(Loss) for the Year after Tax 470,193 114,040

Other comprehensive income for the year, net of tax - -

Total comprehensive income for the year 470,193 114,040

Basic Earnings per share 0.03 0.01

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JAIZ BANKSTATEMENT OF CHANGE IN EQUITYFOR THE YEAR ENDED 30 JUNE 2017

Share Capital Share

Premium RetainedEarnings

RiskRegulatory

Reserve Statutory

Reserve Total N'000 N'000 N'000 N'000 N'000 N'000

Balance at 1 January 2017 14,732,125 627,365 (2,103,858) 1,360,774 93,391 14,709,797Prior year adjusments - - (1,753) - - (1,753)Profit for the year - - 470,193 - - 470,193Balance at 30 June 2017 14,732,125 627,365 (1,635,418) 1,360,774 93,391 15,178,237

Share Capital Share

Premium RetainedEarnings

RiskRegulatory

Reserve

ProfitEqualisaion

reserve Total N'000 N'000 N'000 N'000 N'000 N'000

Balance at 1 January 2016 11,829,700 632,289 (1,427,183) 115,465 - 11,150,271Profit for the year - - 114,040 - - 114,040Balance at 30 June 2016 11,829,700 632,289 (1,313,143) 115,465 - 11,264,311

30 June 2017

30 June 2016 2016

The sum of N649 Million was paid to Jaiz Foundation as part of cleansing exercise of the pre-operation Non- Permissible Income inline with the directive of the Central Bank of Nigeria.

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JAIZ BANK

STATEMENT OF CASH FLOWSFOR THE YEAR ENDED 30 JUNE 2017

2017 2016Notes N'000 N'000

Cash flow from operating activitiesNet profit/(loss) before tax 470,193 114,040Adjustments for non cash items:Depreciation 12 220,093 170,277Profit on Disposal of Non-Current Asset- Motor Vehicle 27 - (40)Amortization of Intangible Assets 14 28,162 22,330Amortisation of leasehold Improvement 13 29,168 53,790Provision for financing impairment 32 170,000 63,497Amortisation of prepaid rent 31 90,570 75,526Operating profit before changes in operating asset and liabilities 1,008,186 499,420

Working capital adjustment:Interbank Murabaha - (1,054,247) 1,054,247Sukuk 5 195,826 (144,179)Murabaha recievables 6 (117,045) 172,356Investment in Musharaka 7 - -Qard Hassan 8 86,663 - 33,305Istisna 9a (2,358) 197,488Ijara Recievables 10 (658,216) 208,519Salam Receivables 18,679 -Investment in trading assets 11 (1,640,896) 845,046Other assets 15 (3,469,278) (785,369)Customers' current account (17a) 12,212,951 (12,597,566)Other Financing 18a (996,635) 996,635

Net cash from/(used in) operating activities 5,583,630 (9,586,708)

INVESTING ACTIVITIESPurchase of property, plant & equipment 12 (886,326) 567,684Purchase of intangible assets 14 (67,747) 67,747Improvement on leasehold properties 13 (14,047) 57,015Net cash used in investing activities (968,120) 692,446

FINANCING ACTIVITIES

Shares issued 2,897,501 (2,902,425)Cleasing of pre-operating non-allowable income - -Prior year adjustment 21 (1,753) -Customers investment accounts (17b) (418,941) (285,148)Net cash provided by (used in) financing activities 2,476,807 (3,187,573)

Increase (Decrease) In Cash And Cash Equivalents 7,092,317 (12,081,835)Cash and cash equivalents at beginning of year 25,658,067 31,981,540Cash And Cash Equivalents At 31 December 32,750,384 19,899,705

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JAIZ BANK

STATEMENT OF SOURCES AND USES OF QARD FUNDFOR THE YEAR ENDED 30TH JUNE, 2017

Qard HasanReceivables Total

Qard HasanReceivables Total

Balance at 1 January 205,618 205,618 207,513 207,513Share loans to staff - - - -Staff loans - - - -Loans to customers - - - -Others - - - -Total uses during the year 205,618 205,618 207,513 207,513

Repayments (86,715) (86,715) (1,895) (1,895)Balance at 30 June 118,903 118,903 205,618 205,618

Sources of qard fundContribution by the bank 118,903 118,903 205,618 205,618

2017 2016N'000 N'000

The purpose of this Statement is to disclose the status of the financial accommodation that was granted to members of staff whenthey bought the Bank's shares under 2012 Private Placement Exercise as well as the status of Staff Loans taken over by the Bank asa result of recruitment from other Banks. Staff under critical situations were also granted this type of accommodation.

JAIZ BANK

STATEMENT OF SOURCES AND USES OF CHARITY FUNDFOR THE YEAR ENDED 30 JUNE 2017

2017 2016N'000 N'000

Sources of Charity Funds

Undistributed Charity funds at the beginning of the year 13,193 1,819,270Non-permissible income during the year 5,933 54,964Total Sources Of Charity Funds During The Year 19,126 1,874,234

Uses of Charity Funds15,655 -

Philontropic Activities - -Total uses of funds during the year 15,655 -

Undistributed charity funds at the end of the year 3,471 1,874,234

This Statement discloses how the Non-permissible Income was being dispensed with.

During the period under review the Bank had utilised the sum of N15.7Million non-permissible Income generated in the last twoquarters.

JAIZ BANK

NOTES TO THE FINANCIAL STATEMENTS#NAME?

1 Reporting entity

2 Significant Accounting Policies

(a) Statement of Compliance with International Financial Reporting Standards

(b)

i Going Concern

ii Fair Value of Unquoted Equity Securities and Investment Properties

The preparation of financial statements requires the use of estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and thereported amounts of revenues and expenses during the reporting period. Although these estimates are based on the management's best knowledge of current events and actions, actual results ultimately may differ from those estimates.The most significant uses of judgments and estimates are as follows:

Fair value shall be determined for each investment individually in accordance with the valuation policies of the Bank. Where the fair values of the Bank's unquoted equity securities cannot be derived from an active market, they shall bederived using a variety of valuation techniques. Judgment by management is required to establish fair values through the use of appropriate valuation models, consideration of comparable assets, discount rates and the assumptions used toforecast cash flows. Investment properties and investments in real estate projects shall be carried at fair value as determined by independent real estate valuation experts. The determination of the fair value for such assets requires the useof judgment and estimates by the independent valuation experts that are based on local market conditions existing at the date of the statement of financial position.

Jaiz Bank Plc is the first fully fledged non-interest financial institution in Nigeria. The Bank commenced operation on January 6th, 2012 with three benaches in two states and the Federal Capital Territory.

The Financial Statement of the Bank as at 30 June 2017, is only for the Bank as it has no subsidiary and/or Associate company.

The Bank's Corporate Headquarter address is Kano House, Plot 73, Ralph Shodeinde Street, Central Business District, Abuja Nigeria.

The financial statements have been prepared in accordance with the requirements of International Financial Reporting standards (IFRS) as issued by International Accounting standards Board (IASB). For matters on which no IFRS

standard is applicable or IFRS conflicts with Shari'ah rules and principles, the bank uses the relevant Financial Accounting Standard as issued by the Accounting & Auditing Organization for Islamic Financial Institutions (AAOIFI) and

shariah rulings as determined by the shariah supervisory board of the Bank.

Financial statements are to be prepared under the historical cost convention, and may be modified by their valuation of certain investment securities, property, plant and equipment. Financial statements are to be prepared mainly inaccordance with the International Financial Reporting Standards (“IFRS”) issued by the International Accounting Standards Board (“IASB”). For matters that are peculiar to Islamic Banking and Finance, the Bank shall rely on theStatement of Financial Accounting (“SFA”) and Financial Accounting Standards (“FAS”) issued by the Accounting and Auditing Organization for Islamic Financial Institutions(“AAOIFI”), Standards issued by the Islamic FinancialServices Board (“IFSB”) and Circulars issued by the Central Bank of Nigeria (“CBN”) shall also be of guidance.

The Bank's management shall be making assessment of the Bank's ability to continue as a going concern and where satisfied that the Bank has the resources to continue in business for the foreseeable future shall form a judgment andprepare accounting information based on that. In any situation whereby the Board of Directors is aware of any material uncertainties that may cast significant doubt upon the Bank's ability to continue as a going concern such issues shallbe disclosed in the annual report.

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iii Impairment Provisions against Financing Contracts with Customers

iv Impairment of Investments at Fair Value through Equity

v Liquidity

(c) Non-Current Assets

Motor vehicle (6 years) 16.67%Furniture and fittings (5 years) 20%Equipment (5 years) 20%Computer Equipment- General (3 years) 33%Computer Equipment- Special (5 years) 20%Computer software (10 years) 10%Freehold Buildings (50 years) 2%

Leasehold building over the expected life of the leaseLeasehold improvement over the period of the lease

The Bank shall review its financing contracts at each reporting date to assess whether an impairment provision should be recorded in the financial statements. In particular, judgment by management is required in the estimation of theamount and timing of future cash flows when determining the level of provision required. Such estimates are based on assumptions about factors involving varying degrees of judgment and uncertainty and actual results may differresulting in future changes to the provisions. In addition to specific provisions against individually significant financing contracts, the Bank also shall make a collective impairment provision of 1% against exposures which, although notspecifically identified as requiring a specific provision, have a greater risk of default than when originally granted. This takes into consideration, factors such as any deterioration in country risk, industry, and technological obsolescence, aswell as identified structural weaknesses or deterioration in cash flows.

The Bank shall treat investments carried at fair value through equity as impaired when there is a significant or prolonged decline in the fair value below their costs or where other objective evidence of impairment exists. The determinationof what is 'significant' or 'prolonged' requires judgment. The Bank would evaluate factors, such as the historical share price volatility for comparable quoted equities and future cash flows and the discount factors for comparable unquotedequities.

The Bank shall manage its liquidity through consideration of the maturity profile of its assets and liabilities on daily basis. This requires judgment when determining the maturity of assets and liabilities with no specific maturities.

Inventory of stationery and consumables held by the Bank are to be stated at the lower of cost and net realizable value in line with IAS 2. When inventories become old or obsolete, an estimate is to be made of their net realizable value.For individually significant amounts, this estimation is to be performed on an individual basis. For amounts that are not individually significant, collective assessment shall be made and allowance applied according to the inventory typeand degree of ageing or obsolescence based on historical selling prices.

Non-current (fixed) assets are initially recorded at cost. They are to be subsequently stated at historical cost less depreciation and any accumulated impairment loss. Historical cost includes expenditure that is directly attributable to theacquisition of the assets.

Subsequent costs are included in the asset's carrying amount or are recognized as a separate asset, as appropriate, only when it is probable that future economic benefits associated with the asset will flow to the Bank and the cost of theasset can be measured reliably. All other repairs and maintenance should be charged to the income statement during the financial period in which they are incurred.

Construction cost in respect of offices is carried at cost as work in progress. On completion of construction, the related amounts are transferred to the appropriate category of fixed assets. Payments in advance for items of fixed assets areincluded as Prepayments in Other Assets and upon delivery are reclassified as additions in the appropriate category of property and equipment.

Asset that do not reach a limit of N25,000 (Twenty Five Thousand Naira Only) are expensed immediately in the income statement, but capitalized if above limit.

Depreciation is to be provided on a straight-line basis to write off the cost of asset over their estimated useful live. The annual rate which should be applied consistently over time are as follows:

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(e) Inatngible Assets

(f) Financial Instruments – Initial Recognition and Subsequent Measurement

(g) Ijarah (Leasing)

(h) Murabaha Receivables from Banks

(i) Murabaha Receivables from Customers

(j) Musharaka

Amortization is recognized in the income statement on a straight line basis over the estimated useful life of the software.

All financial assets and liabilities are initially recognized on the trade date, i.e. the date that the Bank becomes a party to the contractual provisions of the instrument. The classification of financial instruments at initial recognition dependson the purpose and the management's intention for which the financial instruments were acquired and their characteristics. All financial instruments are measured initially at their fair value plus transaction costs, except in the case offinancial assets recorded at fair value through income statement.

Property, plant and equipment is derecognised on disposal or when no future economic benefits are expected from it use. Gain and losses are recognised in the income statement.

Depreciation is charged when the assets are available for use irrespective of whether they are put to use. Assets that are subject to depreciation are reviewed for impairment whenever events or changes in circumstances indicate that thecarrying amount may not be recoverable. An asset's carrying amount is written down immediately to its recoverable amount if the asset's carrying amount is greater than its estimated recoverable amount. The recoverable amount is thehigher of the asset's fair value less costs to sell and value in use.

Gains and losses on disposal are determined by comparing proceeds with carrying amount. These are included in the statement of income for the year.

The Bank shall comply fully with the requirements of Sharia in recognition and measurement of Ijarah financing. The periodic lease rentals receivable are treated as rental income during the period they occur and charge thereon isincluded in operating expenses while initial direct cost incurred are written off to the income statement in the period they are incurred.

These are interbank commodity Murabaha transactions. The Bank arranges a Murabaha transaction by buying a commodity (which represents the object of the murabaha) and then resells this commodity to the beneficiary murabeh (afteradding a profit margin). The sale price (cost plus the profit margin) is paid either lump sum at Maturity or in installments by the Murabeh over the agreed period. Murabaha receivables from banks are stated net of deferred profits andprovision for impairment, if any.

Customer Murabaha receivables consist of deferred sales transaction agreements and are stated net of deferred profits, any amounts written off and provision for impairment, if any. Promise made in the Murabaha to the purchaseOrderer is obligatory upon the customer and the bank can claim damages to the exact amount of loss suffered.

Musharaka contracts represents a partnership between the Bank and a customer whereby each party contributes to the capital in equal or varying proportions to establish a new project or share in an existing one, and whereby each of theparties becomes an owner of the capital on a permanent or declining basis and shall have a share of profits or losses. These are stated at the fair value of consideration given less any amounts written off and provision for impairment, ifany.

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(k) Impairment of Investment in Risk Assets

Profit and/or principal that is outsatnding Classification Provision90 days but less than 180 days Substandard 10%180 days but less than 360 days Doubtful 50%360 days and over Loss 100%

(l) Income Recognition

i Murabaha

ii Ijarah Muntahia Bittamleek

iii Musharaka

iv Dividends

v Fees and Commission Income

Ijarah income is recognized on a time-apportioned basis, over the lease term. Accrual of income is suspended when the bank believes that the recovery of these amounts may be doubtful.

At each balance sheet date, the Bank assesses whether there is objective evidence that the financial assets are impaired. Financial assets are impaired when objective evidence demonstrates that a loss event has occurred after the initialrecognition of the asset, and that the loss event has an impact on the future cash flows of the asset that can be measured reliably.

Assets found not to be impaired individually are assessed collectively for any impairment that has been incurred but not identified earlier. Insignificant assets are tested for impairment collectively.

The Bank considers impairment both at individual asset level and also at collective level. All individually significant assets are assessed for specific impairment.

Impairment loss on assets classified at amortized cost are measured as the difference between the carrying value of the asset and the present value of future cash flows discounted at the initial assets effective profit rate. Losses arerecognized in the income statement of the period the loss is incurred.

Also, provision is determined from a specific assessment of each customer's account in accordance with the Central Bank of Nigeria's (CBN) Prudential Guidelines. A minimum general provision of 1% is made on all risk assets, whichhave not been specifically provided for.

When an investment is deemed not collectible, it is written off against the related provision for impairments and subsequent recoveries are credited to the provision for loan losses in the statement of income. If the amount of theimpairment subsequently decreases due to an event occurring after the write-down, the release of the provision is credited as a reduction of the provision for impairment in the statement of income.

Risk assets in respect of which a previous provision was not made are written directly to the statement of income when they are deemed to be irrecoverable.

Where the income is quantifiable and contractually determined at the commencement of the contract, income is recognized on a time-apportioned basis over the period of the contract based on the principal amounts outstanding. Accrualof income is suspended when the bank believes that the recovery of these amounts may be doubtful.

Income on Musharaka Contracts is recognized when the right to receive payment is established or on distribution by the Musharek.

Dividends from investments in equity securities are recognized when the right to receive the payment is established. This is usually when the dividend has been declared.

The Bank earns fee and commission income from a diverse range of services it provides to its customers.

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vi Sale of Property under Development

Contract to construct a property; orContract for the sale of completed property

vii Non-Credit Related Fee Income

viii Foreign Incomea)

b)

ix Earnings Prohibited by Shari 'a

x Service Income

xi Revenue from Sale of Goods

xii Bank's Share as a Mudarib

xiii Expense Recognitiona)

b) Return on Equity of Investment Account Holders

m Transactions in Foreign Currencies

i

ii

iii

Revenue from sales of goods is recognized when the significant risks, rewards and control of ownership of the goods have passed to the buyer and the amount of revenue can be measured reliably.

Where the contract is judged to be for the sale of a completed property, revenue is recognized when the significant risks, rewards and control of ownership of the property are transferred to the buyer.

This is recognized at the time the services have been performed and delivered or the transaction has been completed.

Commission on negotiation of various letters of credit and overdue Profit on delayed foreign payments are accounted for on receipt.

Other Profit and income earned on the Bank's own funds held outside Nigeria are accounted for on receipt.

The bank is committed to avoid recognizing any income generated from non-Islamic sources. Accordingly, all non-permissible income is transferred to charity.

Revenue from rendering of services is recognized when the services are rendered.

The Bank's share as a mudarib for managing the equity of investment account holders is accrued based on the terms and conditions of the related mudaraba agreements whereas, for off balance sheet equity of investment accounts,mudarib share is recognized when distributed.

Profit on mudaraba payable (banks and non-banks)Profit on these is accrued on a time-apportioned basis over the period of the contract based on the principal amounts outstanding.

Where property is under development and agreement has been reached to sell such property when construction is complete, the bank considers whether the contract comprises:

Where a contract is judged to be for the construction of a property, revenue is recognized using the percentage of completion method, as construction progresses. The percentage of work completed is measured based on the costsincurred up until the end of the reporting period as a proportion of total costs expected to be incurred.

Return on equity of investment account holders is based on the income generated from jointly financed assets after deducting Mudarib share and is accrued based on the terms and conditions of the underlying Mudaraba agreement.Investors' share of income represents income generated from assets financed by investment account holders net off allocated administrative expenses and provisions. The bank's share of profit is deducted from the investors' share ofincome before distribution to investors.

The financial statements are presented in Nigerian Naira, which is the reporting currency in line with IAS21 (Effects of foreign exchange)

Transactions in foreign currencies are recorded in the books at the rate of exchange ruling on the date of the transactions.

Monetary assets and liabilities denominated in foreign currencies are converted into Naira at the rate of exchange ruling at the balance sheet date. All differences are to be taken to the statement of income.

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iv

n Taxation

i Current Income Taxation

ii Deffered Taxation

o Investments

i Investment Securities

ii Investments at Fair Value through Statement of Income

iii Investments at Fair Value through Equity

iv Investments in Subsidiaries

Investments at fair value through equity are those which are designated as such or are not classified as carried at fair value through statement of income. These include investments in equity securities and managed funds.

Investments classified as 'at fair value through statement of income’ are subsequently measured at fair value. The unrealized gains and losses arising from the remeasurement to fair value are included in the consolidated statement ofincome.

Non-monetary items that are measured in terms of historical cost in a foreign currency are translated into Naira using the exchange rates as at the dates of the initial recognition. Non-monetary items measured at fair value in a foreigncurrency are translated into Naira using the exchange rates at the date when the fair value is determined. Exchange gains and losses on non-monetary items classified as “fair value through statement of income” are taken to the incomestatement and for items classified at “fair value through equity” such differences are taken to the statement of comprehensive income.

Any goodwill arising on the acquisition of a foreign operation and any fair value adjustments to the carrying amounts of assets and liabilities arising on the acquisition are treated as assets and liabilities of the foreign operations andtranslated at closing rate.

After initial measurement, investments at fair value through equity are subsequently measured at fair value. Unrealised gains and losses are recognised in statement of comprehensive income and then transferred to the available for sale

Income tax is the amount of income tax payable on the taxable profit for the period determined in accordance with current statutory rate. Income tax payable on profits, based on the applicable tax law, is recognized as an expense in theperiod in which the related profits arise. All taxes related issues including deferred tax are treated in accordance with IAS 12 (Income taxes).

Provision for deferred taxation is made by the liability method and calculated at the current rate of taxation on the temporary differences between the net book value of qualifying fixed assets and their corresponding tax written downvalue in accordance IAS 12 (Income taxes). The principal temporary differences arise from depreciation of property, plant and equipment, provisions for pensions and other post-retirement benefits, provisions for Investment losses andtax losses carried forward. The rates enacted or substantively enacted at the balance sheet date are used to determine deferred income tax.

Deferred tax assets are recognized where it is probable that future taxable profit will be available against which the timing differences can be utilized.

Investment securities are initially recognized at cost and management determines the classification at initial investment. Investments in securities are classified, measured and recognize in accordance with IAS 39 (Financial Instrumentsmeasurement and recognition).

Investments at fair value through statement of income include investments designated upon initial recognition as investments at fair value through statement of income. Financial assets carried at fair value through statement of income arerecognised at fair value, with transaction costs recognised in the consolidated statement of income.

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p Retirement Benefits

q Provisions, Contingent Assets and Contingent Liabilities

r Borrowings

i Murabaha and Due to Banks

ii Murabaha and due to non-banks

s Fiduciary Activities

t Segment Reporting

Investments in subsidiaries are carried in the company's balance sheet at cost less provisions for impairment losses. Where, in the opinion of the Directors, there has been impairment in the value of an investment, the loss is recognized asan expense in the period in which the impairment is identified.

On disposal of an investment, the difference between the net disposal proceeds and the carrying amount is charged or credited to the statement of income.

Retirement benefits to employees are provided under a defined contribution scheme, which is funded by contribution from the bank and employees. Funding under the new scheme is 8.0% by staff and 10% by the Bank based on annualbasic salary, housing and transport allowances in line with the new Pension Reform Act, 2014. Membership of the scheme is automatic upon resumption of duty with the Bank. The Bank has no further payment obligations once thecontributions have been paid.

The Bank's liabilities in respect of the defined contribution are to be charged against the profit of the year in which they become payable. Payments are made to Pension Fund Administration companies, who are financially independentof the bank.

Provision is recognized when the Bank has a present obligation whether legal or constructive as a result of a past event for which it is probable that an outflow of resources embodying economic benefits will be required to settle theobligation and the amount can be reliably measured, in accordance with the International Financial Reporting Standards (IAS 37).

Transactions that are not currently recognized as assets or liabilities in the balance sheet, but which nonetheless give rise to credit risks, contingencies and commitments are reported off balance sheet. Such transactions included letters ofcredit, bonds, guarantees, acceptances, trade related contingencies such as documentary credits etc.

Outstanding and unexpired commitments at year end in respect of these transactions are to be shown by way of note to the financial statements.

Income on off-balance sheet engagement is in form of commission and fees.Commission and fees are recognized when transactions are executed.

This represents funds received from banks on the principles of murabaha contracts and are stated at fair value of consideration received less amounts settled.

These are stated at fair value of consideration received less amounts settled. Profit paid on borrowings is recognized in the statement of income for the year.

The Bank acts as trustee in its capacity as a Mudarib when managing the equity of investment account holders. Equity of investment account holders is invested in murabaha and due from banks, sukuk and financing contracts withcustomers. Equity of investment account holders is carried at fair value of consideration received less amounts settled. Expenses are allocated to investment accounts in proportion of average equity of investment account holders to totalaverage assets of the Bank.

Income is allocated proportionately between equity of investment account holders and owners' equity on the basis of the average balances outstanding during the year and share of the funds invested. Equity and assets of restrictedinvestment account holders are carried off-balance sheet as they are not assets and liabilities of the Bank.

The Bank prepares its segment information based on geographical and business segments as primary and secondary reporting segments, respectively in accordance with IFRS 8 (Operating segments).

A business segment is a group of assets and operations engaged in providing products or services that are subject to risks and returns that are different from those of other business segments. A geographical segment is engaged inproviding products or services within a particular economic environment that are subject to risks and returns different from those of segments operating in other economic environments.

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v Cash and Cash EquivalentCash comprises:i Cash in handii Balance held with Central Bank of Nigeriaiii Balance with banks in Nigeria and outside Nigeriaiv Demand deposit denominated in Niara and other foreign currencies

Cash equivalent are short term, highly liquid instruments which are:a readily convertible into cash, whether in local and foreign currencies; andb

w Ordinary Share Capital

i Share Issue Costs

ii Dividend on Ordinary Shares

Financial assets and liabilities are offset and the net amount reported in the balance sheet when there is a legally enforceable right or shariah requirement to set off the recognized amounts and there is an intention to settle on a net basis,or realize the asset and settle the liability simultaneously.

so near to their maturity dates as to present insignificant risk of changes in value as a result of changes in profits rates.

Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of new shares are shown in equity as a deduction, net of tax, from the proceeds.

Dividends on ordinary shares are appropriated from revenue reserve in the period they are approved by the Bank's shareholders.

Dividends for the year that are approved by the shareholders after the balance sheet date are dealt with in the subsequent events note.

Dividends proposed by the Directors but not yet approved by members are disclosed in the financial statements in accordance with the requirements of the Company and Allied Matters Act 1990.

The Bank has appointed the Management committee charged with the responsibility of allocating resources and assessing performance as the Chief Operating Decision Maker as required under IFRS 8. The CODM is reviewed andadvised by the Board for decisions on significant transactions and or events

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JAIZ BANK

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 30TH JUNE, 2017

3 Cash and Balance with Central Bank of Nigeria 2017 2016N'000 N'000

Cash on Hand 3,129,164 1,993,114Current account with CBN 461,876 8,596,964Deposit with CBN 14,773,997 12,089,710CBN AGSIMS 15,564 12,089,710At 31 June 18,365,037 22,679,788

4 Due from Banks and Financial Institution 2017 2016N'000 N'000

Balance with banks within Nigeria:First Bank Plc 310,946 750,109Other Banks 1,806,573 -Unity Bank Plc - -

2,117,519 750,109Balance with banks outside Nigeria:First Bank UK 5,010,193 102,993Habib Bank UK 2,936,129 2,125,177Commerzbank AG - -Standard Chartered - 1,075 -Bank Al-Bilad 136,481 -

8,081,728 2,228,170

At 31 June 10,199,247 2,978,279

N'000 N'000InterBank Murabaha 1,054,247 -At 31 June 1,054,247 -

Cash on hand constitutes the aggregate cash balances in the vaults of the Bank branches whiledeposits with the Central Bank of Nigeria represent Mandatory Reserve Deposits(as prescribed bythe CBN) and are not available for use in the bank’s day–to–day operations.

The balance held with Banks outside Nigeria substantially represent the Naira equivalent ofForeign Currency balance held on benfit of Customers in respect of Letter of Credit transactions.The corresponding Liabilty is included in Margin Deposits under "Other Liabilities" (see Note18). The amount is not available for the day to day operations of the Bank.

1

5 Sukuk 2017 2016N'000 N'000

Opening Balance 1,154,621 1,010,442Addition during the year - 144,179Disposal during the year (38,222) -Part Liquidation during the period 157,604 -At 31 June 958,795 1,154,621

In 2013 the Bank invested N1,000,000,000 in a sukuk issued by Osun Sstate Government at14.5% Return on Investment. In 2014 the Investment was increased to N2,400,000,000 throughSecondary Market purchase. The Sukuk has a seven-year Tenor with terminal date of 2020.Principal Repayment will commence from january 2015. And the InterBank Murabaha is betweenthe bank Steerling Islamic window, it was granted to Steerling Bank Customer.

2

JAIZ BANK


6 Murabaha Recievables 2017 2016N'000 N'000

Murabaha Staff 7,761 12,547Murabaha Related Party 22,045 19,875Gross Recievable 29,806 32,422Allowance for impairment (150,226) (281,875)Deffered Profit (1,634,937) (1,754,598)At 31 June - 1,755,357 - 2,004,051

7 Investment in Musharaka 2017 2016N'000 N'000

Gross Investment in Musharaka 1,200,000 1,200,000Allowance for impairement (8,822) (6,500)At 31 June 1,191,178 1,193,500

8 Investment in Qard Hassan 2017 2016N'000 N'000

Share loan to staff 118,455 137,618Loan to customers 500 68,000Gross investment in Qard Hassan 118,955 205,618Allowance for impairement (52) -At 31 June 118,903 205,618

9a Investment in Istisna 2017 2016N'000 N'000

Istisna Recievable 1,078,753 1,032,372Allowance for impairement (124,209) (487,414)Deffered Profit (162,066) (118,043)At 31 June 792,478 426,915

2017 201610 Investment in Ijarah N'000 N'000

Ijara wa Iqtina 13,626,636 13,053,803Ijara home finance 24,597 26,067Ijara Auto & Others 254 1,909Ijara Others 536,573 391,125Gross investment in Ijara 14,188,060 13,472,904Allowance for impairement (107,102) (78,632)At 31 June 14,080,958 13,394,272

3

10b Investment in Salam 2017 2016N'000 N'000

Istisna Recievable 21,477 -Allowance for impairement (430) -Deffered Profit (2,368) -At 31 June 18,679 -

11 Investment in Asset Held for Sale 2017 2016N'000 N'000

Unsold Inventory of Properties - -Advance for LC Murabaha-in-Transit 1,871,479 330,712Inventory-Murabaha Corp. Finance 100,129 -At 31 June 1,971,608 330,712

4

JAIZ BANK


12 Property, Plant and Equipment

FreeholdLand

BuildingFreehold

OfficeEquipment

MotorVehicle Furnitures

and Fixtures

ComputerEquipment

LibraryBooks

FixedAssets WIP Total

Cost N' 000 N' 000 N' 000 N' 000 N' 000 N' 000 N' 000 N' 000 N' 0001 January 2017Cost 144,727 130,924 327,926 244,085 1,357,324 350 156,420 2,361,756Additions/Reclassifiaction - 143,727 324,798 236,632 114,568 163,223 27,897 - 350 163,285 886,326Disposals - - - - - - - - -30 June 2017 1,000 455,722 564,558 358,653 163,223 1,385,221 - 319,705 3,248,082

Accumulated depreciation1 January 2017 - 3,571 84,026 115,426 74,014 582,456 174 - 859,667

- 49,156 40,884 12,867 117,186 - - 220,093Adjustment - 3,949 106,015 16,293 12,401 95,584 - 174 234,068Disposals - - - - - - - - -30 June 2017 - 7,520 239,197 172,603 99,282 795,226 - - 1,313,828

Cost1 January 2016Cost 1,000 462,549 519,053 354,095 150,868 1,381,093 - 2,868,658Additions/ Reclassification 143,727 - 331,625 - 191,127 - 110,010 - 17,690 - 23,769 350 156,420 - 373,724Disposals - - - - - - -30 June 2016 144,727 130,924 327,926 244,085 133,178 1,357,324 350 156,420 2,494,934

Accumulated depreciation1 January 2016 - 4,008 205,862 158,862 94,533 735,377 - - 1,198,642Depreciation - - 25,303 18,467 13,093 113,369 44 - 170,276Disposals - - 437 - 147,139 (61,903) - 33,612 - 266,290 130 - (509,251)30 June 2016 - 3,571 84,026 115,426 74,014 582,456 174 - 859,667

30 June 2017 1,000 448,202 325,361 186,050 63,941 589,995 - 319,705 1,934,254

30 June 2016 144,727 127,353 243,900 128,659 59,164 774,868 176 156,420 1,635,267

1

JAIZ BANKNOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 30TH JUNE, 2017

13 Leasehold Improvement 2017 2016Cost N'000 N'000Balance at 1 January 738,544 795,559Addition 66,653 - 57,015Balance at 30 June 805,197 738,544

AmortisationBalance at 1 January 699,605 764,152Adjustments 52,606 - 118,337Amortisation for the year 29,168 53,790

781,379 699,605

Carrying amountsBalance at 30 June 23,818 38,939

14 Intangible Assets 2017 2016N'000 N'000

Cost Computer softwareComputer

softwareBalance at 1 January 495,495 563,242Addition 67,747 - 67,747Disposal - -Balance at 30 June 563,242 495,495

Amortisation and impairment lossesBalance at 1 January - 209,234Amortisation for the year 28,162 22,330Reclassification - 28,162 - 231,564

Carrying amountsBalance at 30June 563,242 495,495

1


15 Other Assets 2017 2016N'000 N'000

Sundry Debtor 68,602 187,332Prepaid rent 284,459 254,937Prepaid Sukuk Premium 59,501 77,809Other prepayments 680,508 577,875Prepaid Staff 188,266 279,015Inventory-Cheques, Printing and ATM Card 1,752,258 55,670Branch development expenditure 194,538 578,660Account recievables 3,423,860 2,249,261Ijara accrued Profit 2,474,098 1,551,836Due from Banks ATM Transactions - 23,708Operating Suspense 248,228 292,791Interbranch 3,537 49,494Total 9,377,855 6,178,388Impairment of Other Assets (46,409) (88,165)Balance at 30 June 9,331,446 6,090,223

Movement in impairment of other assets: 2017 2016

N'000 N'000Balance at 1 January 6,090,223 5,400,255Charge for the year 3,287,632 778,133Impairment of Other Assets (46,409) (88,165)Balance at 30 June 9,331,446 6,090,223

JAIZ BANKNOTES TO THE FINANCIAL STATEMENTS

16a Taxationi) Statement of Financial position 2017 2016

N'000 N'000Balance brought forward - 36,453Charge for the year -

- 36,453Add under provision in previous years - -Taxation - 36,453Less payment for the year - (36,453)Balance at 30 June - -

N'000 N'000Balance at 1 January 1,772,577 1,566,003Provision for the year - -Balance at 30 June 1,772,577 1,566,003

(b) Reconciliation of effective tax rate 2017 2016N'000 N'000

Profit for the period 470,193 114,040Total income tax expense - -Profit excluding income tax 470,193 114,040Income tax using the Company’s domestic tax rate 150,462 36,493Non-deductible expenses* - -Tax incentives (investment allowance) - -

Balance at 30 June 150,462 36,493

1


17 Due to customers 2017 2016N'000 N'000

Analysis by type of account(17a) Current Account 31,046,083 18,833,132(17b) Mudaraba Investment Account 25,020,847 27,629,873(17c) Mudaraba Term deposit 2,190,085 -

Balance at 30 June 58,257,015 46,463,005

Analysis by type of Depositor 2017 2016N'000 N'000

Government 1,049,268 1,452,403 22,908,555 13,929,433

Individual 34,299,192 31,081,169Balance at 30 June 58,257,015 46,463,005

Analysis by maturity

2017 2016N'000 N'000

Current Deposits 31,046,083 18,833,132Savings Deposits 13,264,123 12,189,05630days Deposits (JAPSA) 11,756,724 15,440,81760days Mudaraba Term Deposit 2,190,085 -Balance at 30 June 58,257,015 46,463,005

(17b) Equity of Investment Accountholders 2017 2016N'000 N'000

Children saving Account 673,434 541,470Jaiz premium Savings Account 11,756,724 15,440,817Others including MTDs 2,704,295 393,052Balance at 30 June 15,134,453 16,375,339

18a Other Financing 2017 2016N'000 N'000

Fund Sources Outside the Bank (CBN/CACS) - 996,635Balance at 30 June - 996,635

CBN/CACSIntervention Fund

18b Other Liabilities 2017 2016N'000 N'000

MC/Margin Deposits 6,111,719 2,004,627Accounts Payable 301,093 104,906Vendors payable 12,497 79,870Other Tax Liabilities 25,558 92,316Profit payable to Mudararaba Savings Account 22,855 707e-Banking Payables 62,311 16,875Due to Charity - 3 597

Sundry Deposit 12,650 7,427Due to Mudaraba Depositors - -Other Accurals 57,011 22,909Other Payables 97,006 41,641

The Bank has introduce Mudarabah Tenored Deposits which has give customers the opportunity to choose from a basketof Return available for different tenors.

The Central Bank of Nigeria (CBN) in collaboration with the Federal Government of Nigeria (FGN) represented by theFederal Ministry of Agricture and Water Resources (FMA & WR) established the Commercial Agricultural Credit Schemes(CACS). During the year, Jaiz Bank Plc didn't receive any amount for on-lending to customer as speecified by theguidelines. Financing granted under the scheme are for a seven year period at an interest rate of 9% p.a.

All the customers deposit are analysed by maturity into Current and Savings as follows:

Balance at 30 June 6,702,697 2,371,875


19 Owners EquityA Share capital

(i) Authorised 2017 2016N'000 N'000

15,000,000,000 Ordinary shares of N1 each(31 June 2017: 15,000,000,000 of N1 each) 15,000,000 13,000,000

Balance at 30 June 15,000,000 13,000,000

(ii) 2017 2016N'000 N'000

14,732,125,000 Ordinary shares of N1 each At 1 January 14,732,125 11,829,7002,902,425,000 Ordinary Shares of N1 each issued during the year. - -Balance at 30 June 14,732,125 11,829,700

20 Share Premium 2017 2016N'000 N'000

during the 2012 financial year 627,365 632,289CBN Provission (Due from Shareholders) - -Balance at 30 June 627,365 632,289


21 Retained Earnings 2017 2016

Balance at 1 January (2,103,858) (1,427,183)Net profit for the year 470,193 114,040Prior year adjustments (1,753) -Risk regulatory reserve - -Balance at 30 June (1,635,418) (1,313,143)

22 Risk Regulatory Reserve 2017 2016N'000 N'000

Balance at 1 January 1,360,774 115,465Adjustment against retained earnings - -Balance at 30 June 1,360,774 115,465

N'000 N'000Balance at 1 January 2014 93,391 -Provisions - -Balance at 30 June 93,391 -

The Risk Regulatory Reserve is created as required by the Central Bank of Nigeria (CBN) PrudentialGuideline section 12.4(a)(i). This is a non distributable reserve which represents the difference betweenimpairment of Risk Asset under IFRS Rules and provisioning under CBN Prudential Guidelines. There wasno significant difference between the CBN recommended provision and that of IFRS requirement during theyear, hence there was no transfer in the period.

1


23 Income from Islamic Finanace 2017 2016N'000 N'000

Murabaha profit Corporate 1,143,269 777,950Murabaha profit Retail 367,147 229,826Murabaha Trade Finance 1,177 690Total profit from Murabaha transactions 1,511,593 1,008,466Ijara wa Iqtina Profit 1,213,124 1,299,098Ijara Finance Lease Profit 50,691 20,437Ijara profit home finance 696 2,358Ijara Others 470 437Total profit from Ijara transactions 1,264,981 1,322,330Istina Profit 53,355 67,860

108,547 65,991InterBank Murabaha Income 14,767 -Total Income from financing 2,953,243 2,464,647

24 Income from investment activities 2017 2016N'000 N'000

Trading Assets Income 211,060 -Sukuk profit 82,288 98,351

Total Investment income 293,348 98,351

25 (i). RETURN ON EQUITY OF INVESTMENT ACCOUNT HOLDERS 2017 2016N'000 N'000

586,456 571,155

Profit from Financing Investments paid to Mudarabah Account Holders 586,456 571,155

(ii) Mudarib fees/ profit of Joint Investments

Bank's fees as Mudarib. 1,203,896 1,285,214Profit from the Bank's Joint Financing investments 1,456,239 706,629Bank's fee as Mudarib/Profit of owned Joint Investmets 2,660,135 1,991,843

Profit paid to Unrestricted Mudarabah Account Holders /Fees of Mudarib

The Bank operates the Unrestricted type of Mudaraba Investment, in which the Mudarib(the Bank) is authorized by the providers of Funds (Rabbul Mal) to invest their funds in themanner which the Mudarib deems appropriate. Profits are shared as a common PercentageRate rather than a Fixed amount. The Investments were jointly funded by the Bank and theEquity of Investment Account holders. The amount of N586.45 Million was paid by theBank to the Mudaraba Account Holders for the Half Year 2017.

1


26 Fee and commisssion 2017 2016N'000 N'000

Banking Service Fees 442,214 133,370Foreign Exchange Commissions 86,886 19,161Islamic Finance Facility Fee - -Trade Finance Fees 61,285 21,571Other Operating Income - 2 11,810

590,383 185,912

27 Other Operating Income 2017 2016N'000 N'000

Wakala income 70,019 38,640

28 Non Trading Exchange (Loss)/Gain

29 Staff costs 2017 2016N'000 N'000

Salaries 674,183 568,258Staff pension 133,170 83,750Staff allowances 179,992 265,946Medical and other allowance 81,056 51,777Training and Seminar expenses 38,551 23,100

1,106,952 992,831

30 Depreciation and Amortisation 2017 2016N'000 N'000

Depreciation of Property, Plant & Equipment 220,093 170,276Amortisation of Leasehold Improvement 29,168 53,790Amortisation of Intangible Assets 28,162 22,330

277,423 246,396

Other operating income includes fees earn from Wakala Transactions, other operatinf feesand recovery of Financing Impairment from Saving Aaccont Holders in line with AAOFIFinancial Standard.

The Banks' Accounting Policy provides that Monetary Assets & Liabilties denominated inForeign Currencies been converted in to Naira a the rate of exchange ruling at the Bbalancesheet date and any differenece thereof be taken to the Income Statement.

2

JAIZ BANKNOTES TO THE FINANCIAL STATEMENTS

31 Other Expenses 2017 2016N'000 N'000

Advertising and marketing 37,423 96,146Administrative - note 31 (i) 842,699 408,210Subscription and Professional fees 23,636 11,101Provision of Banking Sector Resolution Cost Trust Fund - -ACE's Expense 24,757 10,371Rental charges (Occupancy Cost) 120,922 96,414Licences 4,907 45,237Bank Charges 25,054 20,041Audit fee & Other Expenses 18,000 11,500Directors expenses 110,116 61,971Others 18,436 -

1,225,950 760,991

31 (i) Administrative 2017 2016N'000 N'000

Telephone expenses 1,064 10,629Internet connection 82,799 38,986SWIFT/NIBBS Charges 8,671 8,831Courier charges 9,890 2,600Local and foreign travels 35,827 17,397Printing & Stationeries 24,982 13,555Repairs and maintenance 9,507 27,588Security Guards 12,690 16,599Other security expenses 18,034 12,594Money and other Insurance 13,977 10,265NDIC Premium 104,301 71,997Fuel Expense 8,579 5,757Vehicle repairs 5,959 2,883Service contract (HR and Admin) 125,749 58,412Data recovery and other software exp 60,617 37,527Donation 150 202Newspapaer, Magazine & Periodials 797 510Entertainment 2,249 2,074Penalty charge - 100Sundry expenses 9,045 6,381Cash shortage W/O 156 96Technical service 162,361 1,600Generator expenses 31,277 13,148Cleaning expxnses 1,980 9,444ATM related expenses 10,402 7,155Sukuk Premium expenses 9,154 9,193

3

ISO 27001 4,454 21,848Treasury expenses 22,063 -E-Business expenses 35,986 -Corporate and retail banking expenses 230 -Regulatory expenses 29,749 839

842,699 408,210

4


32 Provision for Finance Impairment of Financing and Investment32 (a) PROVISION FOR IMPAIREMENT OF FINANCING AND INVESTMENT

Prudential Adjustment for the Year ended 30th June 2017

Provision on Risk AssetsSpecific General OKL TOTAL

N'000 N'000 N'000 N'000Provision per CBN Prudential Guideline 976,958 774,657 46,409 1,798,024Impairement Allowance per IAS 39 (Specific and Collective) 118,106 272,735 46,409 437,250As at 30,June. 2017 858,852 - 1,360,774

32 (b) PROVISION FOR IMPAIREMENT OF FINANCING AND INVESTMENT

(ii) Impairement by Products (IFRS)

Qard Hassan Istisina Ijara Salam Other Assets TotalN'000 N'000 N'000 N'000 N'000 N'000

Balance at 1 January - 123,889 98,577 - 62,271 422,112Re-classification 52 - 5,424 - (15,862) (154,862)Impairment for current year - 320 3,101 430 - 170,000Balance at 30 June 52 124,209 107,102 430 46,409 437,250Notes 8 9 10 10 15

(iii) Provision by Products (CBN)

Qard Hassan Istisina Ijara Salam Other Assets TotalN'000 N'000 N'000 N'000 N'000 N'000

Balance at 1 January 2,554 287,372 587,099 - 62,271 1,782,887Recovery/ Prov. No longer Required 20,397 (292,846) - (15,862) (154,863)Impairement for current year - 320 3,101 430 - 170,000Balance at 30 June 2,554 308,089 297,354 430 46,409 1,798,024

33 SIGNIFICANT SHAREHOLDING (5% UNIT & ABOVE) 2017 2016Holdings % Holdings %

Dantata Investment & Securities Limited 1,410,209,270 12 1,923,220,476 16Dantat Aminu Alhassan 618,136,207 5 - -Islamic Development Bank 1,002,160,494 8 1,002,160,494 9Dangote Industries Ltd 1,000,000,000 8 1,000,000,000 9Altani Investment Limited 800,000,000 7 800,000,000 7Indimi Muhammadu 1,366,906,522 12 1,366,906,522 12Mutallab Umaru Abdul 977,722,774 8 1,430,117,383 12At 30 JUNE 7,175,135,267 61 7,522,404,875 64

34 Earnings per share

Basic earnings per share

Profit attributable to ordinary shareholders 2017 2016N'000 N'000

Profit for the period 540,212 152,680Profit attributable to ordinary shareholders 540,212 152,680

Weighted average number of ordinary shares 2017 2016N'000 N'000

Issued ordinary shares at 1 January 14,732,125 11,829,700Effect of share options exercised - -

14,732,125 11,829,700

Basic earnings per share 0.04 0.01

There have been no transactions during the year which caused dilution of the earnings per share.

The Provision for impairement is based on the impairement test conducted by the Bank's Consultants in accordance with the International Acconunting Standard (IAS39). The first table is for the impairement while the second table is for the provision on Risk Assets in accordance to the Central bank of Nigeria's Prudential Guidelines.Under the total Colown in International Financial reporting Standard (IFRS) impairement table below, addition of the prior year over impairement charges andimpairement for current year makes up the current year charges.

During the period under review, no transfer was made from Statement of Changes in Equity (SCE) to Risk Regulatory Reserve(Non DistributsbleReserve).

Basic earnings per share of N0.04kobo ( 2017:N0.01kobo) is based on the profit attributable to ordinary shareholders of 540211.691 ( 2017:N152680) and on theordinary shares of14732125 ( 2016:11829700).

Weighted average number of ordinary shares at 30 June

1

35(i)

(ii)

2017

N'000 N'000RELATED PARTY

RELATIONSHIPWITH THE BANK

LIMITAMOUNTRECEIVABLE

Dr. Umaru Abdulmutallab Director 810,000 416,856

Dr. Umaru Abdulmutallab Director 330,000 265,736Dr. Umaru Abdulmutallab Director 50,000 33,010Dr. Umaru Abdulmutallab Director 150,000Aminu Dantata Director 370,000 215,229Aminu Dantata Director 630,000 630,000Aminu Dantata Director 36,738 18,257Aminu Dantata Director 38,400 28,101Aliko Dangote Director 800,000 590,878Aliko Dangote Director 25,000 3,716Aliko Dangote Director 95,000 104,702Aliko Dangote Director 23,400 22,246Mukhtar Danladi Hanga Sani Director 54,000 38,248Falalu Bello Director 1,120,000 716,533HRH Engr. Sani Bello Director 65,000 35,648HRH Engr. Sani Bello Director 510,000 454,212HRH Engr. Sani Bello Director 162,250 56,486HRH Engr. Sani Bello Director 80,250 80,250Executive Director Executive Director 64,350 48,239Executive Director Executive Director 4,113 1,140Nafiu Baba-Ahmad Director 200,000 121,160Employee Employee 1,345,784 1,209,078

6,964,286 5,089,724

2016N'000 N'000

RELATED PARTY RELATIONSHIPWITH THEBANK

LIMITAMOUNTRECEIVABLE

Dr. Umaru Abdulmutallab Director 810,000 570,024.60Dr. Umaru Abdulmutallab Director 330,000 307,830Dr. Umaru Abdulmutallab Director 50,000 32,795Dr. Umaru Abdulmutallab Director 9,800 3,834Dr. Umaru Abdulmutallab Director 150,000 127,124Aminu Dantata Director 370,000 415,457Aminu Dantata Director 630,000 630,000Aminu Dantata Director 36,738 23,781Aminu Dantata Director 38,400 38,400Aminu Dantata Director 30,000 33,291Aliko Dangote Director 500,000 420,284Aliko Dangote Director 470,000 61,830Aliko Dangote Director 25,000 12,633Mukhtar Danladi Hanga Sani Director 54,000 43,381HRH Engr. Sani Bello Director 65,000 63,657

HRH Engr. Sani Bello Director 510,000 507,290

Nafiu Baba-Ahmad Director 200,000 160,000Executive Director Executive Director 4,113 3,091Executive Director Executive Director 64,350 53,931Employee Employee 1,162,208 1,063,606

5,509,610 4,572,241

Related parties: Parties are considered to be related if one party has the ability to control the other party orexercise influence over the other party in making financial and operational decisions, or one other partycontrols both. The definition includes investment as well as key management personnel.

Transaction with key management personnel: The Bank's key management personnel, and persons connectedwith them, are also considered related parties. The definition of key management includes the close membersfamily of key personnel and any entity over which key management exercise control. Close members family arethose family members who may be expected to influence, or be influenced by that individual in their dealingswith Jaiz Bank plc and its related entities/parties.

1

36 INFORMATION REGARDING DIRECTORS 2017 2016N'000 N'000

EmolumentsFees:

Chairman 5,000 2,500

Other directors (N4 Million each) 40,000 14,000

Emolument as executives 93,782 70,336

Highest paid director 48,577 36,432

N N 2017 2016Number Number

5,000,000 - 10,000,00010,000,001 - 15,000,000 - -15,000,001 - above - -

2 237 INFORMATION REGARDING EMPLOYEES

N N June, 2017 June, 2016Number Number

Below - 400,000 - 261400,001 - 500,000 92 53500,000 - 600,000 51 24600,000 - 700,000 63 11700,000 - 800,000 3 -800,000 - 900,000 - -900,000 - 1,000,000 - -1,000,000 - 5,000,000 183 275,000,000 - 10,000,000 2 -Above - 10,000,000 - -

Number of persons employed as at the end of the year were:June, 2017 June, 2016

Number NumberManegerial 10 12Senior 51 50Junior 333 314

394 376

38 EVENTS AFTER THE REPORTING PERIOD

No. of Directors excluding the chairman with gross emoluments within the following ranges were:

The number of employees excluding Directors in receipt of emoluments excluding allowances in the following ranges were:

There are no events after the reporting date which could have had a material effect on the financial statements as at 30 June 2017.

1

39 CARD ISSUANCE AND USAGE IN NIGERIA AS AT 30 JUNE 2017

2017

CARD TYPETRANSACTION VOLUMES

TRANSACTION VALUE

N'000MASTER CARD 155,120 1,860,642VERVE DEBIT CARD 1,682,969 21,055,234

1,838,089 22,915,876

2016

CARD TYPETRANSACTION VOLUMES

TRANSACTION VALUE

N'000MASTER CARD 1,676 18,576VERVE DEBIT CARD 1,263,578 15,468,725

1,265,254 15,487,301

40 COMPLAINTS DATA

(i) ATM complaints data- 30 JUNE 2016

JAIZ BANK'SMACHINE

OTHERBANKS'

MACHINENumber of complaints 13 19Number of complaints resolved 13 17Number of complaints unresolved - 2Amounts in dispute (N'000) 6,300 4,000

(i) ATM complaints data- 30 June 2017

JAIZ BANK'SMACHINE

OTHERBANKS'

MACHINENumber of complaints 57 145Number of complaints resolved 56 139Number of complaints unresolved 1 6Amounts in dispute (N'000) 723,000 2,846,023

In line with CBN circular Ref FPR/DIR/CIR/GEN/01/020, below are the customer complaints data for the year:

In line with Sec.11 of the CBN' Circular on The Guidance for issance and usage of cards in Nigeria, below is the Bank's information on it's Card

2

41 FINANCING ANALYSIS Jun-17 Jun-16(I) By Performance

N'000 N'000Performing 34,939,956 29,814,127Non Performing: - -Substandard 796,988 523,602Doubtful 569,462 402,305Lost 595,766 389,398

36,902,171 31,129,432

(ii) By Security Jun-17 Jun-16N'000 N'000

All Asset Debenture 691,512 315,280Corporate Guarantee 625,679 426,394Personal Guarantees 541,171 67,096Pledge of Asset/Lien of Assets 211,054 53,149Deposit of Title Deeds 226,708 2,475Legal Mortgage 23,724,740 19,976,844Equitable Mortgage 67,544 3,172Salary Domiciliation/ lien of Assets 9,676,099 8,990,488Post Dated Cheques 115,596 146,156Clean/Staff Qard Hassan 118,903 205,618Hyphotication of Goods 28,165 35,545Simple Deposit of Title 122,564 148,248Irrevocable Standing Payment Order/Letter of comfort 110,877 172,409Domiciliation of Contract proceeds 641,560 586,557

36,902,171 31,129,432

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(iii) By Location Jun-17 Jun-16N'000 N'000

HEAD OFFICE 2,834,673 3,132,121ABUJA 12,603,684 12,547,832KANO 2,497,622 2,582,237KADUNA 2,805,610 2,192,278GOMBE 266,675 377,305MAIDUGURI 74,057 93,912KANO 2 4,151,193 2,737,221KATSINA 2,216,906 1,828,915NASS 1,253,816 1,391,767WUSE 3,303,333 2,336,831GUSAU 822,899 800,932ATBU 11,121 52,248SOKOTO 284,349 272,203ZOO ROAD 476,991 72,731KABUGA 58,188 48,154NNPC 562,986 317,842BAUCHI 80,536 40,882YOLA 97,863 55,430KADUNA 2 45,843 10,429BANNEX 113,064 32,544IKEJA 1,395,741 -IBADAN 10,905 -ILORIN 168,846 -GWARIMPA 95,640 -SAMARU 458,915 -HOTORO 64,991 -KEBBI 1,088 -MARINA 25,734 -STAFF QARD 118,903 205,618

36,902,171 31,129,432

(iv) By Product Jun-17 Jun-16N'000 N'000

Murabaha Corporate 9,127,959 4,810,483Ijarah Wa Iqtina Corporate 6,967,317 6,779,361Musharakah 1,200,000 1,200,000Qard Hassan 118,903 205,618Murabaha Household Appliance 167,413 98,026Murabaha Auto Finance 1,491,027 1,217,232Ijarah Auto Finance 35,261 8,008Ijarah Home Finance 6,234,768 5,778,982Ijarah Service 952,822 908,662Murabaha Retail/Gen. 9,506,472 9,090,687Istisna 1,078,753 1,032,372Salam 21,477 -

36,902,171 31,129,432

(v) By Sector Jun-17 Jun-16N'000 N'000

Agriculture 3,431,332 2,074,976Real estate 8,646,130 7,932,502Manufacturing 745,134 354,744Education 1,091,847 1,182,322Construction 2,608,250 2,294,043Information technology 307,056 381,857General 8,908,123 6,815,875General Commerce 5,201,142 5,358,622Oil and Gas 5,862,341 3,926,453Human health and social work activities 2,335 3,559

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Transport 98,480 804,479 36,902,171 31,129,432

(vi) By Category Jun-17 Jun-16N'000 N'000

Corporate 27,034,443 22,016,974Retail 9,867,728 9,112,458

36,902,171 31,129,432

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(vii) By Age Jun-17 Jun-16N'000 N'000

0 - 30 days 2,901,592 1,191,55831 - 60 days 1,842,699 706,98061 - 90 days 632,342 639,26591 - 180 days 5,540,209 3,826,133180 - 360 days 4,893,659 2,828,005Over 360 days 18,027,086 19,938,097

33,837,587 29,130,038

42 LEGAL CLAIMS, CONTINGENT LIABILITIES AND COMMITMENTS

(ii) Contingent Liabilities 2017 2016N'000 N'000

Advanced Payment Guarantees 1,904,780 1,149,897Bonds and Guarantees 2,627,412 1,966,559Wakala Investment 7,505,721 -

12,037,914 3,116,45643 (iii) Capital Commitments

(iv) Guarantees and other Financial Commitments

44 CONTRAVENTION OF CBN GUIDELINES 2017 2016N'000 N'000

Due Diligence KYC violation and improper Politically Exposed Person (PEP) approval - 4,000Non implimentation of AML/CFT training program and Enhanced Due Diligence in respect of PEP - 2,000Non-Montoring of CCO's Transaction by Internal Audit - 2,000Breach of CBN Foreign Exchange Trading Position procedure 2,000 -Untimely Rendition of eFASS daily returns for the period 3rd and 25th January 2016 50 -Disbursement to State Govertment before DMO approval 2,000 -Non-implimentation of External Auditors Recommendation 2,000

6,050 8,00045 COMPARATIVE FIGURES

46 EMPLOYEE BENEFIT PLANS 2017 2016N'000 N'000

Opening defined contribution obligation 15,691 16,331Charge for the year 40,177 14,611Payment to Fund administrator (33,684) (13,377)As at 30, June. 22,183 17,566

(i) Defined Benefit Plans

During the Year under review the Bank in its ordinary course of business was involved in16 cases. The Directors having souht the o of professional legalcounsel are of the opinion that based on the advice rceived, no signifcant liability will cystallise from these cases.

There were no capital commitments at the end of the reporting period of 31 March 2017.

The Directors are of the opinion that all known liabilities and commitments which are relevant in assessing the company's financial position,

The Investments in Islamic Finance are shown here as Gross , while on the face of Statement of Financial position they are shown as Net of Impairement and

Certain comparative figures have been restated where necessary for a more meaningful comparison

A defined contribution plan is a pension plan under which the Bank pays contributions at a fixed rate. The Bank does not have any legal or constructive

A Defined Benefit Plan is a pension plan that defines an amount of pension benefit that an employee is entitled to receive on retirement, dependent on one ormore factors such as age, years of service and salary. The Bank does not currently operate a Defined Benefit Plan and therefore does not have any obligation(legal or constructive) in this regard.

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