Annual Report 2014

Chairman’s Message
annual report
2014
Making Difference in Banking
IBBL has pioneered need based, socially responsive and
development focused Banking through operations & services
unique by mechanism and objectives. Since inception at the
early nineteen eighties as the first Shari’ah based Bank in South
& Southeast Asia, the Bank emerged as the provider of financial
solution to the people of all strata in the society through inclusive,
diverse and cordial services. Driven by the core value of equitable
distribution and justice in financial activities, IBBL prioritizes
welfare banking through diversifications of its financing in terms of
size, sector & geographical location with emphasis on employment
generation for ensuring sustainable development.
REGISTERED OFFICE: Islami Bank Bangladesh Limited, 40, Dilkusha Commercial Area, Dhaka-1000, Bangladesh
GPO Box No.233; Phone : PABX (88-02) 9563040, 9560099, 9567161, 9567162; Mobile : 88-01711-435638-9
FAX : 88-02-9564532, 9568634; SWIFT : IBBLBDDH, e-mail : info@islamibankbd.com; Website : www.islamibankbd.com
The Message
from the
Holy Qur’an
So eat of the lawful and pure (things) which Allah has provided for you. And
be grateful for the favor of Allah, if it is He Whom you worship.
(Surah An-Nahl : 114)
Verily! Allah will not change the condition of a people as long as they do not
change their state of goodness themselves.
(Surah Ar-Ra’d : 11)
And say (O Muhammad) “Do deeds! Allah will see your deeds, and (so will) His
Messenger and the believers. And you will be brought back to the All-Knower
of the unseen and the seen. Then He will inform you of what you used to do.”
(Surah At-Taubah : 105)
Guidance from
the Hadith
Abu Hurairah (May Allah be pleased with him) reported : The Messenger of
Allah ( ) said, “When a man dies, his deeds come to an end except for
three things: Sadaqah Jariyah (ceaseless charity); a knowledge which is
beneficial, or a virtuous descendant who prays for him (for the deceased).”
[Sahih-al-Muslim].
Abu Dharr (May Allah be pleased with him) reported : The Prophet ( ) said
to me, “Do not belittle any good deed, even meeting your brother (Muslim)
with a cheerful face”. [Sahih-al-Muslim].
Abu Hurairah (May Allah be pleased with him) reported : The Prophet ( )
said, “Whoever takes the money of the people with the intention of repaying it,
Allah will repay it on his behalf, and whoever takes it in order to spoil it, then
Allah will spoil him.” (Sahih al-Bukhari)
Contents
Vision 6
Mission 7
Strategic Objectives 8
Core Values & Commitments 9
Code of Conduct and Ethical Principles 10
Awards & Recognitions 11
Forward Looking Statement 13
Chairman’s Message 14
Managing Director’s Review 16
Milestones 20
Sponsors 21
Corporate Governance
Corporate Governance Report 33
CEO and CFO’s Declaration to the Board 52
Certificate on Compliance of
Corporate Governce 53
Compliance Status of BSEC Guidelines 54
Corporate Structure Directors’ Report 59

Profile of IBBL 62
Corporate Information 22 Business Review 65
Corporate Structure 23
Board and its Committees 24 Risk Management 87
Shari’ah Supervisory Committee 25 Market Disclosure of Basel II 97
Management Committee 26 ICT & Automation 108
Senior Executives 27 Green Banking 111
Directors’ Profile 28 CSR Report 116
Islami Bank Foundation 123
Management Report and Commentary

Management Report and Analysis 126
Products and Services 130 Financial Statements
Alternative Delivery Services 133
Communication and Business Promotion 136 Independent Auditors’ Report 170
Consolidated Financial Statements
Performance Analysis Consolidated Balance Sheet
Consolidated Profit and Loss Account
172
174
Stakeholders’ Information 138 Consolidated Cash Flow Statement 175
Graphical Presentation 142 Consolidated Statement of Changes in Equity 176
Segment Information 144 Financial Statement of IBBL
Horizontal & Vertical Analysis 145 Balance Sheet 178
Profitability, Dividends, Performance Profit and Loss Account 180
& Liquidity Ratios 146 Cash Flow Statement 181
Statement of Value Added 147 Statement of Changes in Equity 182
Financial Calendar 151 Liquidity statement 184
Financial Highlights 152 Notes to the Consolidated Financial Statements 185
Five Years Performance 153 Financial Statement - OBU 248
Media Highlights 155 Financial Statement - IBSL 254
Publications 156 Financial Statements - IBCML 277
Success Story 157
Standard Disclosure Index 287
Report of the Shari’ah Suprevisory Committee 165 Bank’s Network 290
Audit Committee Report 166 Glossary 293
Notice of 32nd AGM 294
Proxy Form & Attendance Slip 295
Our vision is to always strive to achieve superior financial

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

to ensure soundness and development of the financial system
based on Islamic Principles and to become a strong and efficient
organization with highly motivated professionals, working for
the benefit of people, based on accountability, transparency and
integrity to ensure stability of the financial systems
We will try to encourage savings in the form of direct investment.

We will also try to encourage investment particularly in projects,
which are more likely to lead to higher employment.
6 Annual Report 2014

To establish Islamic Banking through introduction of a welfare oriented banking system and
also ensure equity and justice in all economic activities, achieve balanced growth and equitable
development through diversified investment operations particularly in the priority sectors and less
developed areas of the country.
To encourage the socio-economic development and financial services to the low-income community
particularly in the rural areas.
Annual Report 2014 7

• Ensure welfare oriented banking
• Ensure customers’ satisfaction
• Be excellent in serving the cause of least developed community and area
• Achieve global standard
• Emerge as a healthier & stronger Bank at the top of the banking sector
• Build and consolidate corporate culture
Objectives
• Ensure Corporate Social Responsibilities (CSR) through all activities

• Promote green banking culture and ecological balance
Strategic
• Provide impeccable and progressively better customer services using latest technologies
ensure diversification of investment by sector, size, economic purpose & geographical location
and expand need based Retail, SME and Micro financing
• Invest in the thrust and priority sectors of the economy
• Establish a set of managerial succession and adopt technological changes to ensure
development of an Islamic Bank as a stable financial institution
• Pay more importance in human resources as well as financial capital
• Strive hard to become a company of choice and nurture & develop talent in a performance-
driven culture
• Ensure lucrative career path, attractive facilities and excellent working environment
• Develop human resources continuously and provide adequate logistics to satisfy customers’
need
• Motivate team members to take the ownership of every job
• Ensure zero tolerance on negligence in compliance with both Shari’ah and regulatory guidelines

SHARI’AH
HONES
TY ILITY
U NTA B
ACCO
TRANS
PAREN
C Y
JUSTICE
Core Values
• Trust in Almighty Allah
• Adherence to the spirit of Islamic Shari’ah
• Honesty & Integrity
• Transparency & Accountability
• Welfare Driven
• Equity and Justice
• Environment Consciousness
• Customers Focus
• Respect for all
• Discipline & cooperation
Commitments
• Shari’ah directives
• Regulators
• Shareholders
• Society
• Customers
• Employees and
• Environment

Code of
Conduct and
Ethical Principles
Shari’ah foundation of ethics • Ensuring justice and fairness

• Accountability to Almighty Allah • Adopting the good and articulating the truth
• Integrity • Transparency in statements
• Principle of vicegerency on the earth Rules of conduct towards shareholders, managers and fellow
• Sincerity employees
• Piety • Developing the work through innovative and creative ideas

• Righteousness and making one’s work perfect Allah- • Respecting the working hours of the institution
fearing conduct in all activities
• Getting acquainted with the directives
Principles of personal ethics • Safeguarding the institution’s assets and facilities
• Faith-driven conduct
• Refraining from doing anything detriment to the
• Trustworthiness organizational interest
• Legitimacy Rules of conduct towards those who deal with the institution
• Objectivity and related parties
• Professional competence and diligence • Being keen to meet the needs of those who deal with the
institution
Rules of ethical conduct
Self-motivated rules influencing job performance • Giving rights to those who are entitled for
• Allah-fearing state of mind • Preserving confidential information
• Adhering to the shari’ah and implementing its principles • Being serious in one’s behavior and actions

Awards & Recognitions
ICAB National Award for ICMAB Best Corporate Dhaka International Trade Fair Small Entrepreneur Friendly Bank
Best Presented Annual Award 2014 Award 2014 Award 2014
Reports 2013
Financial Branding Award 2014 NRB Recognition Award 2014 Best Brand Award 2014
(GOLD AWARD)
Better Bangladesh Foundation International Expatriate Day Channel I

Award 2014 Award 2014 Award 2014


South Asian Federation of Accountants (SAFA)
SAFA awarded IBBL the 1st Position both under Private Sector Banks (including Co-operative Banks) in the best-presented annual
reports and SAARC Anniversary Award for Corporate Governance Disclosures for the year 2012 and Certificate of Merit under
Private Sector Banks (including Co-operative Banks) in the best-presented annual reports for the year 2013.
Institute of Chartered Accountants of Bangladesh (ICAB)

ICAB conferred IBBL the 2nd position under Private Sector Banks (including Co-operative Banks) in the best-presented annual reports
for the year 2013. ICAB also conferred IBBL with the 1st position both under private sector banks (including Co-operative Banks) in
the best-presented annual reports and SAARC Anniversary Award for Corporate Governance Disclosures for the year 2012.
Institute of Cost and Management Accountants of Bangladesh (ICMAB)

ICMAB glorified IBBL with the ICMAB National Best Corporate Award – 2014, 2013, 2012, 2011, 2010 (1st Position amongst the
Private Commercial Banks in Islamic Operation).
The Banker
IBBL, being only Bank in Bangladesh, entered into the World’s Top 1,000 Banks list in 2012. IBBL has made Bangladesh proud of
being among the best 1000 banks in the world, ranked by ‘The Banker’, UK’s premier financial magazine. This prestigious ranking
is a clear testimony to IBBl’s stability and strength and its leadership in financial sector of Bangladesh. Position in terms of key
indicators in 2014:
• 40th in Performance (Profits on capital),
• 162nd in Return on Asset (ROA),
• 701st in Soundness (Capital Assets Ratio),
• 826th in Size (Assets base) and
• 970th in Strength of Tier 1 capital.
Global Finance
The Global Finance, a reputed USA-based Financial Magazine, recognized IBBL as the best Islamic Financial Institution of
Bangladesh for the years 2008, 2009, 2010, 2011 & 2013.
Bangladesh Bank and SME Foundation

Bangladesh Bank and SME Foundation jointly conferred the prestigious award - the best ‘Small Entrepreneur Friendly Bank of the
Year’ in 2014 to IBBL considering its contribution to SME financing.
Other Recognitions
• IBBL won gold medal as ‘Branding Bangladesh Award’ for its outstanding performance in remittance services last year by
Centre for Non-Resident Bangladeshi in 2014.
• IBBL was awarded Financial Branding Award by Centre for Non Resident Bangladeshis for its outstanding contribution to the
Financial Branding of Bangladesh in abroad in 2014.
• IBBL also received Best Brand Award from Bangladesh Brand Forum in 2014.
• IBBL was awarded the Best Pavilion Prize of month long Dhaka International Trade Fair - 2014.
• Bangladesh Sports Press Association conferred IBBL the best patron award for its outstanding contribution to the country’s
sports sector in 2014.
• IBBL was awarded the 1st prize among the participating banks in Remittance Fair on the occasion of International Migrants Day - 2013
• Western Union honored IBBL with an incentive amount of USD $90,088 as the best category performance to achieve the
target of 3,00,000 transactions fixed for the year 2013.
• IBBL was ranked by Banladesh Bank among top ten banks in Bangladesh for Green banking in 2012 and 1st position in
Climate Risk Fund Utilization activities.

Forward
Looking
Statement
Forward-looking statements are management’s outlook on • Changes in corporate tax structure and VAT on banking
future events. These statements based on current plans, service
estimates and projections. All forward-looking statements • Changes in trade, monetary and fiscal policies and laws
are, by their nature, subject to risks and uncertainties, many of
which are beyond control. • Changes in international prices of essentials, which may
result to volatility in Foreign Exchange Market
We have included in this report certain forward-looking
statements with respect to our financial position, operating • Volatility in the money market
results and business development. We believe that the • Occurrence of natural or man-made disasters or calamities
expectations reflected in these forward-looking statements or conflicts, including any effect of such disasters
are reasonable. Readers are cautioned that a number of
factors could cause actual results to differ, in some instances • Changes in investor sentiment or consumer spending or
materially, from those anticipated or implied in any forward- savings behavior
looking statements. These factors include, among others: • Potential impact on IBBL’s businesses, business policies,
• Changes in national economic, political and financial reputation, financial condition or results of operations
conditions from the extensive legal and regulatory proceedings,
• Changes in the government’s adjustments and control investigations and inquiries
policies, and regulatory issues • Usefulness of IBBL’s risk management and mitigation
• Securities and capital markets behavior, including changes processes and strategies
in market liquidity and volatility • Potential impact on IBBL from continually evolving
• Global economic downturn or disruption, including a cyber-security and other technological risks and
significant decline in global trade volumes attacks, including additional costs, reputational damage
• Global embargo/unrest in Middle-east countries affecting Acceptance of the IBBL’s new and existing products and
flow of remittances and trade services by the marketplace
• Potential impact on IBBL’s liquidity and/or costs of funding

as a result of external factors, such as market disruptions

In the name of Allah, the Most Merciful, Peace be upon our Keeping Leadership in Banking
Prophet Mohammed, His Companions and Relatives.
In 2014, we logged into new height in various pertinent business
Distinguished Shareholders, parameters including significant growth in deposit mobilization
i.e. 19%, general investment 15%, operating profit 9%. The Return
Assalamu Alaikum Wa Rahmatullah. on Equity (ROE) and Return on Asset (ROA) recorded at 8.85%
I feel pleasure and privileged to present this preamble to IBBL’s and 0.67% while Earning per Share (EPS) stood at Tk. 2.48. Total
Annual Report 2014 along with the Audited Financial Statements. assets of the Bank rose to Tk. 652,422 million showing a growth
As detailed in the report, the Bank by the grace of Almighty Allah of 19% over the previous year.
maintained to tread the path of continued growth, upheld its
flagship position in the banking of Bangladesh and kept winning IBBL registered moderate growth in foreign exchange business.
the people’s confidence. The Bank handled export business of Tk. 222,753 million, marking
a growth of 9% over the previous year with over 10.07% market
A long 32 years of enduring journey has made the Bank the most
share. On the other hand, the Bank handled import business of
trusted name among the top private sector commercial banks
in the country. We believe that it is our passion for service and Tk. 316,971 million, with 11% growth. The Bank’s total wage
quality, customer focus, innovation and value creation and above earners’ remittance stood Tk. 308,722 million retaining market
all our courage and humility which distinguish us as a bank of share of around 25.53%.
choice and reliance.
People’s Bank
I consider 2014 a year of great success for the Bank. It is not only
in terms of performance, but also the various milestones that the This Bank belongs to the one hundred sixty million people of the
Bank crossed in this eventful year. Despite challenging market country. It is working for all strata of the people of Bangladesh
conditions, we have performed remarkably towards achievement irrespective of cast, creed, religion, gender and political standing
of financial, social and environment goals. turning us an ever-caring, ever-cooperative and ever-trusted
We have also made some remarkable achievements in 2014. banking partner beside them. There are huge numbers of non-
Some of them for example, corporate portfolio was rationalized, Muslims among both of our deposit and investment clients and
SME financing was prioritized, organizational restructuring was shareholders. A big portion of our RDS beneficiaries are women
taken in hand to reduce imbalances, business monitoring and and non-Muslims.
risk management platform had been strengthened.

As a financial services provider, our main focus is on performing ensure Maqasid Al-Shari’ah fully realized as well as transparency
our banking functions effectively for the benefit of our clients – in all activities. All banking transactions are also well recorded,
providing them with access to capital, managing their assets, verified and audited by internal and statutory auditors including
steering financial flows and carefully assessing risks. Mutual Bangladesh Bank and Shari’ah Supervisory Committee.
trust is the core of our business. Clients count on us to provide
them with expert advice and to act as a reliable financial partner. Recognition
Efforts for Keeping the Islamic Banking Flag Atop Though not award hungry, we have achieved a lot of awards
specially prestigious ranking of top 1000 banks in the world with
The Bank through the continuous support and cooperation of the 970th rank in 2014 which was 984th in previous year. We stood
government particularly ministry of Finance, BSEC, Bangladesh highest position in performance category among the South East
Bank and other regulatory authority, media, business community Asian banks. We are awarded numerous times by SAFA, ICAB,
as well as depositors, business partners and well wishers carrying ICMAB, Business Asia, Global Finance and many other renowned
the Islamic banking flagship ahead. We have firm confidence that institutes.
the Bank will continue to win the people’s confidence and keep the
number one position in banking industry of Bangladesh like the Looking Forward
previous years, Insha Allah. We believe that it is the dedication, professionalism and desire
Dedicated to Build a Better Bangladesh to achieve an honored position that drive the IBBL Family to
succeed in this daunting year for the banking sector. In spite
The Bank dedicated its efforts to uphold the dignity of the nation of the above, we look forward to achieving larger targets and
by contributing more and more in the socio-economic as well as strengthening our position in the coming years. We are confident
human development of the country. that our innovative and creative management team will tide
IBBL pays corporate tax on time, some time even before it falls over the challenges successfully in coming days and take the
due as required and asked by the tax authority. The Bank also Bank to a new height of success. We strongly believe that our
deposits Excise duty, tax and VAT to government exchequer on personalized customer service with existing and new products
time. The collective contribution to the National Exchequer from with the support of our huge investment in IT platform, efficient
inception up to December 2014 was Tk.71,650 million of which, and productive resources and efficient risk management, clear
Tk.11,465 million was made in 2014 alone. We are the largest & focused strategy, high standard of corporate governance will
corporate taxpayer in the banking sector of the country. bring sustained growth with improved asset quality that will
maximize value for all the stakeholders in coming years.
Bank for Humanity
Appreciations
IBBL has pioneered social cause programmes toward fulfilling
noble mission of Islamic banking for the greater benefit of We strongly believe that IBBL is unrivaled gift from the Almighty
humanity in Bangladesh. As part of the extended IBBL family, Allah (swt). I wish to thank my colleagues on the Board of
social work is embedded in the Bank. Since inception, we tried to Directors and members of the Shari’ah Supervisory Committee,
enrich economic and social indicators of society concentrating for their judicious guidance and support, which proved so
on value-driven CSR activities particularly supporting education, invaluable. I am also thankful to the respected shareholders,
reducing poverty, giving standard health care service and ensuring Bangladesh Bank and other regulatory authorities. In the end,
environment friendly society for the greater benefit of present we once again express our sincere thanks to all the members
and future generations. Welfare and inclusivity oriented products of IBBL family for their uncompromising loyalty, relentless hard
such as Muhor, Cash Waqf, Hajj, Urban Poor Development work and dynamic team spirit to take the Bank forward.
Scheme etc. of the Bank partake to the economic empowerment I also like to thank our external auditors for carrying out the
of less privileged people of the society. auditing task professionally and advising us on the compliance
as per practice of BFRS.
Corporate Governance and Transparency
At last we would like to offer our whole hearted commitment that
We are committed to observing the highest standards of integrity we are accountable to Almighty Allah (swt) and answerable to
and compliance in all aspects of our work. The corporate our stakeholders and to the people of our beloved country and
governance framework in IBBL is designed to ensure transparency the great nation.
and accountability at all levels. Corporate governance, stronger
control measures and risk management practices, compliance I am pleased to take this opportunity to invite you to our 2015
and ethical values have always been core components of Annual General Meeting and looking forward to seeing you there.
our corporate values. We are ethically, morally and honestly
convinced to comply with the guidelines, instructions and May Allah grant us success in our entire endeavor. Ameen.
policies of all regulatory authorities including Bangladesh Bank,
concerned ministries, BSEC, DSE, and CSE. Strict adherence to
Shari’ah principles is the core strategy of our banking, which, Prof. Abu Nasser Muhammad Abduz Zaher
Insha Allah, will continue. We have applied all these principles Chairman
judiciously in our deposit and investment portfolios in order to

Managing Director’s Review

Respected Stakeholders, millions of people in Bangladesh into reality through providing
better financial services complying Shari’ah principles. The fact
Assalamu alaikum wa rahmatullahi wa barkatuhu. that a bank can run its operation without interest and make
better financial results was a challenge that IBBL could address
It gives me immense pleasure to present a short review on with wholehearted support of regulators, customers, investors
the key performances and achievements of Islami Bank and host of well wishers.
Bangladesh Limited (IBBL) for the year 2014. The previous year
marked the beginning of fourth decade of our historic mission. The next decade may be termed as the ‘decade of development’
In three decades, our bank has been blessed with many wherein the Bank widened its network, services and welfare
achievements - some even beyond expectation. The size of activities in almost all sectors. Launching our flagship
the Bank grew steadily with key indicators doubling in almost microfinance program named Rural Development Scheme
every three years and tripling in every five years. Before looking (RDS) in mid-nineties was unprecedented for any commercial
into the performance of 2014, I would like to commemorate the bank in Bangladesh. The bank expanded its service horizon
three decades of IBBL. across the country through financing in industrial development,
infrastructure, SME, agriculture, housing, and transport as
We started our journey in 1983 as the first Shari’ah based well as facilitating external trade through import, export and
bank in South East Asia with the vision of developing the remittance services.
financial system based on Islamic principles and becoming the
strong and efficient organization based upon accountability, The third decade may be expressed as the ‘decade of
transparency and integrity. Since inception, our central mission consolidation’ wherein IBBL emerged as the market leader
has been to ensure equity and justice in financial transaction in the banking sector contributing substantially in the
through welfare oriented banking towards achieving balanced economic development of Bangladesh. In this decade,
growth and equitable development of the country. Throughout beside consolidating its leadership, IBBL earned international
our welfare run, we tirelessly served the individuals, business, recognition having been included in the ‘top 1000 global Banks’
communities and the country we work in. as ranked by UK based world-reputed financial magazine The
Banker.
The first decade which we may term as the ‘decade of
orientation’, witnessed achievement of seemingly an audacious We may term the ongoing decade as the ‘decade of achieving
goal of presenting Islamic Banking as a viable and sustainable Maqasid al-Shari’ah’ (objective of Shari’ah) which was, in fact,
concept in this region. We worked to translate the dream of the the ultimate objective of establishing Islamic Banking. Beside

interest-free banking practices, we strive to achieve economic Financial Performance | Sustained Growth in
well-being, equitable distribution of income and universal Operating Results
welfare and justice. I recall here a significant comment of
Dr. Saleh Kamel, Chairman of ‘General Council for Islamic Islamic banks assign precedence to universal welfare, inclusive
Banks and Financial institutions’ (CIBAFI) in the 35th annual growth and equitable distribution of resources in their entire
conference of the Islamic Development Bank in Baku, the activities to attain ‘Maqasid’ or purpose of Islamic banking.
capital of Azerbaijan in 2012, Despite deficit and slow recovery in global economy and
subsequent volatility in the country economy, IBBL maintained
“... Over the past decades, academic researchers and its leading position in the banking sector and could manage
Islamic banking practitioners and Shari’ah specialists to achieve reasonable outcomes in all the business areas. The
have emphasized more on the modes and mechanism total assets of the Bank amounted to Tk. 652,422 million as on
of Islamic Banking. We undoubtedly gained success in December 31, 2014 registering 19% increase over previous year.
pursuing interest-free transactions and shari’ah-compliant Equity base of the Bank has increased to stand at Tk.48,570
procedures. But the inherent strength of the Islamic million at year end 2014 against Tk.45,487 million of the
Banking and the ‘Maqa’sid or the objectivity of this system previous year. However, low growth of general investment and
non-investment income coupled with surplus liquidity and non-
like justice in wealth distribution, mass welfare and
performing investment resulted in operating profit at Tk.15,323
emancipation from economic slavery, were not received million. Profit after tax of the Bank was Tk. 3,999 million during
due importance in the works of professional Bankers and 2014 and Earnings Per Share (EPS) was Tk. 2.48 in 2014
Shari’ah experts as much as it was needed.” compared to Tk. 3.07of the previous year. Notwithstanding, we
could consolidate our financial strength through maintaining
Let me look into the performance of IBBL in 2014 in the light of adequacy in capital. The capital adequacy ratio (CAR) of the
Maqasid al-Shari’ah. Bank to stand at 12.83% in 2014 .
Global and National Economic Scenario | Moderate Deposit | Milestone in Resource Mobilization
growth despite challenges IBBL structured its deposit products containing the spirit of
In 2014, global economy continued to expand at a moderate pace Maqasid al-Shari’ah accommodating all types of deposits
which facilitate mass savings. Following the continued growth
with recovery in high income economies, rising employment from the very beginning, IBBL recorded milestone results in
and stimulus packages. The global banking sectors remained resource mobilization raising its deposit from Tk.244,292
fragile with major Banks facing a push of regulatory changes million to Tk.560,696 million in last 5 years. In 2014, we added
and the shift towards more stringent capital requirements Tk.87,555 million in our deposit basket which is the highest
under Basel III. A number of global leading banks were fined for amount in the history of the Bank with 19% growth over 2013.
manipulating the foreign exchange market. We witnessed Tk.500,000 million deposit threshold on 14 April
2014 and Tk.560,000 million on 13 December 2014.
The economy of Bangladesh experienced another toughest
year in 2014 through maintained moderate growth. During Investment | Diversification continued towards
the year, most of the economic indicators did not improve attaining Ma’qasid
much significantly. The persistent political instability and lack In light with the spirit of Maqasid al-Shari’ah, IBBL continued its
of sufficient infrastructural facilities had mainly caused the efforts to further diversify investment portfolio by size, sector,
investment stagnancy in the economy during last couple of economic purpose and geographical location. We made positive
years. This resulted in huge amount of excess liquidity in the shift in our investment portfolio through reducing concentration
banking sector in 2014 as well. in big investments. Percentage of top 100 clients decreased to
45.77% in 2014 from 47.55% in 2013. Percentage of investment
The bygone year was a significant year for both global and up to Tk.100 million increased to 37.87% in 2014 from 35.97% in
country’s Islamic Banking. Globally, Islamic banking has been 2013. Percentage of SME investment stood at 42% in 2014. RDS
able to prove its proficiency despite the global recession and share rose to 3.63% in 2014 from 3.30% in 2013 with 29.09%
diverse challenges, and augur its potentials in recent years growth. The share was only 1.50% in 2007.
with the average annual growth of 18 percent. A dominant
Financial Inclusion | Pursuing since beginning
indicator of the continued growth of the Islamic banking
practices is the assets of more than 500 Islamic financial Financial inclusion is built in IBBL’s core value, ethical policy
institutions amounted to be about 2 trillion US dollars. In and objectives. We are persistently trying to design diversified
Bangladesh, various regulatory updates such as formation of products and services to facilitate financial inclusion. Presently,
refinance fund to support Shari’ah-based financing, issuance of our products and services include from farmers’ accounts,
Islamic Bond took place last year which reaffirmed the gradual students’ accounts, industry workers’ account to different
advancement of Islamic Banking in the country. array of products like Hajj, Mohar and Waqf accounts. In 2014,

we added 1.6 million clients raising our customer base to 9.8 Information Technology | Optimum utilization of
million which constituted 25 percent of global Islamic Banking resources
clients. We are in the verge of being the ‘Bank of Crore Clients’.
The operational procedure of Islamic bank is unique in nature
On the deployment side, we have diversified schemes to meet
with its in-built Shari’ah based modes and mechanism. As the
specific needs of different income groups. We have taken many
traditional software is inadequate to cater this unique need,
initiatives to reach the unbanked people and poorest segments IBBL took up an audacious step of running its own IT platform by
in the most remote areas especially through our RDS program. in-house developed solutions. We have been staying dedicated
International Trade | Retained Leadership in Forex to the goal of delivering excellent banking services through
Business continuous improvements in Shari’ah-compliant technological
platform. We have emphasized on automation of our back-
IBBL operates its international trade operations in the purview end systems. We exert best efforts on automation in order to
of innovative Shari’ah compliant modes and mechanism. Owing provide prompt services to the valued customers developing
to strong commitment to the objective of Shari’ah, IBBL did not procedures and reducing manual operations. Upgraded IT
platform, customer friendly services and digitization works had
even finance in importing the fertilizers to be used in tobacco
been strengthened in the year 2014.
production. As a leader in export and import business among
the PCBs, we retained and further strengthened our position Alternative Delivery Channel | Smooth access to
in the bygone year. We stayed focused as a prime remittance financial services
earning bank in the previous year and further diversified
Committed to the spirit of welfare banking, IBBL had always
remittance landscape in the untapped vicinity around the
been catering to the growing consumer needs in last three
globe. In 2014, we widened our import and export base and
decades. The Bank currently has 450 own and more than 4000
despite country’s negative external sector performance with shared ATM booths. Bank’s state-of-the art high-tech banking
the import being Tk.316,971 million, export being Tk.222,753 devices include On-line banking, i-Banking, SMS Banking, phone
million and Remittance being Tk.308,722 million with 10%, 10% banking. We introduced ATM/Visa Debit Card, Khidmah Credit
and 26% market share respectively. Card, Hajj Card, Travel Card, Remittance Card, E-commerce
(Payment Gateway), IDM (Islami Bank Deposit Machine) which
Human Capital Development | People committed to are delivering quick and flawless banking services to millions
serve for welfare of customer. Bank’s mobile banking service -m Cash- is getting
To realize the Maqasid al-Shari’ah in all its operation, we recruit popular day by day through 154 corporate agents, 32,000
dedicated retail agents and more than 45000 non dedicated
industry best talent, and then groom them future leaders in
retail agents.
Islamic Banking industry through diverse talent development
programs. Total human development had been our key agenda Environment-Friendly Banking | Tuned with Shari’ah
in last few years. We brought qualitative change in the training Banking
programs in 2014 as well. Intensive professional development
Green Banking is consistent with the philosophical basis of
program, managerial training and capacity building programs
the Bank. Since its inception, IBBL has been demonstrating
were conducted to bring excellence among human capital.
its commitment to environmental protection, social benefit
Shari’ah Compliance | The ultimate spirit of Islamic and human welfare. In 2014, we spent a handsome amount in
Banking the areas of green finance, climate risk fund, and marketing,
training and capacity building related to green financing. We are
Being a Shari’ah based bank, IBBL’s focus is not only to always striving to pursue industry best practices for converting
comply Shari’ah in terms of modes and mechanism but also IBBL into a green bank.
to uphold the spirit and objectives for achieving Maqasid. Strict
R & D Activities | Search for Excellence
adherence to Shari’ah principles is the core of all our Banking
operations. We have been trying to bring doubtful income at In an attempt to bring excellence in Islamic Banking knowledge,
zero level. Shari’ah Secretariat has been strengthened with devise Shari’ah compliant innovative products and services
capable manpower. Appropriate logistics has been provided to with due focus on Maqasid-al-Shari’ah, IBBL started Research
conduct off-site audit to enable the Muraqibs to check violation & Development activities in 2011. Being the 1st Shari’ah based
and ensure transparency in shari’ah compliance. Awareness Bank in the region and market leader in banking sector of the
for total Shari’ah compliance among the entire workforce and country, we felt to have a competent R&D division to infuse
dynamism in growing Islamic banking sector. In 2014, Research
clients had been emphasized throughout the year.

and Development Division conducted a number of studies on Chartered Accountants of Bangladesh (ICAB) awarded IBBL
key indicators of the Bank, added value to the publications, the 2nd prize under private sector banks in the best-presented
provided support for capacity building and development annual reports for the year 2013. Bangladesh Bank and SME
of human resources as well as contributed towards Islami Foundation jointly conferred the prestigious award - the best
banking literacy, networking and rapport building with local and ‘Small Entrepreneur Friendly Bank of the Year’ award in 2014.
international institutions. Our bank received Financial Branding Award by Centre for Non-
Resident Bangladeshis for its outstanding contribution to the
Islamic Banking Literacy | United we achieve the goal Financial Branding of Bangladesh abroad in 2014.
Islamic banking literacy has been one of the prime objectives Focus for 2015 | Looking forward
of IBBL. Over the years we have been continuously trying to
eliminate misconceptions about Islamic banking and present 2015 is the 2nd year of the decade of ‘Achieving Maqasid al-
uniqueness of the system compared to its conventional Shari’ah’ wherein we aim to be the ‘Bank for all’. We desire
counterpart. IBBL plays catalyst role in empowering fellow to make IBBL as the ‘Bank of choice’ for all families of the
banks towards promoting Islami banking. Besides, we work country through fulfilling their entire needs. Keeping in view the
for humanizing banking sector through establishing welfare economic and banking scenario and also the expectation of
oriented financing culture. With this mission in mind, our our valued stakeholders, our focus in 2015 shall be on further
bank has been playing key role in all professional bodies like strengthening of capital base, consolidating business growth,
Bangladesh Association of Banks (BAB), Central Shari’ah pursuing sustainable development and widening financial
Board for Islamic Banks of Bangladesh (CSBIB), Islamic Banks inclusion coverage. Besides, we shall put emphasis on further
Consultative Forum (IBCF), Association of Bankers, Bangladesh diversification in investment portfolio to ensure equitable
(ABB), Bangladesh Foreign Exchange Dealer’s Association deployment of resources for minimizing urban-rural gap.
(BAFEDA) and International Chamber of Commerce (ICC). Our efforts shall continue for developing new entrepreneurs,
widening import base and export basket and upholding brand
Corporate Social Responsibility | Working for the image in remittance. We shall endeavor to ensure full shariah
Deprived compliance, good governance and provide technology based
services to the customers.
Corporate Social Responsibility (CSR), being a built in concept
of the bank, has been prominent in IBBL since its inception.
IBBL has become pioneer and got recognized as the leader in Concluding words | Thanks and Gratitude
CSR in the banking sector of the country. We have earned the
We are thankful to our valued clients, business partners, patrons,
reputation of being a welfare oriented bank through dynamic
well wishers from home and abroad for their confidence and
CSR activities. We continued our CSR drives benefiting so far
trust reposed upon us. This has always been a great source
12.33 million people in diverse sectors like education, disaster
of strength and inspiration for us. We conclude expressing
management, health, sports, welfare and humanitarian
our sincere gratitude to Bangladesh Bank for providing us
purpose.
with valuable guidance and continuous support. We are also
Awards and Accolades | Logical sequence of good grateful to the Board of Directors for their visionary role and
deeds continuous encouragement. We thank high spirited Team IBBL
for their dedication, commitment and renewed vigor. Let us
IBBL has been upholding the tenet of Maqasid al-Shari’ah pray to Allah to give us vision, courage and strength to win over
in all its operations for last three decades. We work for challenges in the years to come with professional excellence.
establishing equity and justice, not for reward and recognition.
Nevertheless, IBBL has been awarded in its historic journey
for keeping up with performance par excellence. IBBL was
ranked as one of the top 1000 world Banks by “The Banker”,
UK’s premier financial magazine in 2012. Our position rose to
Mohammad Abdul Mannan
984 in 2013 and 970 in 2014 ranking. South Asian Federation
Managing Director & CEO
of Accountants (SAFA) awarded Certificate of Merit in the
best-presented annual reports for the year 2013. Institute of

2014
2013
2012
2011
2010
2009
Milestones
• Incorporation : 13.03.1983
• Certificate of Commencement of Business : 27.03.1983
• Inauguration of 1st Branch : 30.03.1983
• Formal Inauguration : 12.08.1983
• Formation of Shari’ah Council : 01.05.1983
• Formation of Sadakah Tahbil as a CSR Wing : 04.07.1983
• Listing in Dhaka Stock Exchange Limited : 02.07.1985
• Initial Public Offer (IPO)
Subscription Opened : 30.06.1985
Subscription Closing : 14.07.1985
• 1st Rights Share Issue
Subscription Opened : 10.07.1989
Subscription Closed : 31.12.1989
• Listing in Chittagong Stock Exchange Limited : 07.03.1996
• Opening of 100th Branch : 12.06.1997
• Joining/Agreement with CDBL : 29.12.2004
• In-house Core Banking Software : 02.04.2005
• Issuance of Mudaraba Perpetual Bond (MPB) : 25.11.2007
• 1st Position of IBBL in Inward Remittance since : 31.12.2007
• Commencement of Brokerage House : 01.01.2008
• Formation of Subsidiary Companies
Islami Bank Securities Limited (IBSL) : 22.03.2010
Islami Bank Capital Management Limited (IBCML) : 01.04.2010
IBBL Exchange Singapore Pte. Ltd. : 13.07.2009
• Launching of Offshore Banking Unit : 04.01.2011
• 100% Online Banking : 07.01.2011
• Exclusive Sponsor for Beautification of Dhaka City
on the Occasion of Cricket World Cup 2011 : 17.02.2011
• Launching of iBanking : 16.12.2011
• Agreement with Bangladesh Cricket Board (BCB) for becoming
Franchisee in Bangladesh Cricket League (BCL) : 18.10.2012
• Inauguration of mCash service : 27.12.2012
• Launching of Call Center : 27.12.2012
• Agreement with Grameen Shakti for installation of Bio-gas Plants : 30.12.2012
• IBBL has entered into the World’s Top 1,000 Banks list since : 31.12.2012
• Witnessed Tk. 500,000 Million Deposit : 14.04.2014
• Launching of Shari’ah based Credit Card– ‘Islami Bank Khidmah Card’ : 27.05.2014
• 4000 VISA logo ATMs covering all over the country : 31.06.2014
• Launching of ‘IBBL Travel Card’ : 16.10.2014
• Opening of 400th Own ATM Booth : 31.10.2014

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

Corporate Information
Name of the Company : Islami Bank Bangladesh Limited
Legal Status : Public Limited Company
Company Registration No. : C–10589 Dated March 13, 1983
485
Bangladesh Bank License No. : BL/DA/4290/83
eTIN : 376764873732
VAT Registration No./BIN No. : 19011032134
Line of Business : Banking
Total Branch : 294
SME/Agriculture Branch : 30
Zone : 14
AD Branch : 53
Offshore banking Unit : 03
ATM Booth (own) : 450
ATM Booth (shared) : 4000
IBBL Deposit Machine (IDM) : 33
Employees : 13,574
Directors : 15
Sponsors : 36
Shareholders : 60,857
MPB holders : 23,272
Local Shareholders : 32.75%
Foreign Shareholders : 67.25%
Foreign Correspondents : 723
Chairman : Prof. Abu Nasser Muhammad Abduz Zaher
Vice Chairmen : 1. Yousif Abdullah Al-Rajhi, KSA
2. Engr. Mustafa Anwar
Managing Director : Mohammad Abdul Mannan
Company Secretary : Abu Reza Md. Yeahia
Head of Internal Control & Compliance : Md. Habibur Rahman Bhuiyan, FCA
Chief Financial Officer : Mohammed Shahid Ullah, ACA, CIB, CDCS
Credit Rating Agency : Credit Rating Information and Services Ltd.
Subsidiary Companies : 1. Islami Bank Securities Limited
2. Islami Bank Capital Management Limited
3. IBBL Exchange Singapore Pte. Ltd.
Statutory Auditors : 1. M/s. Syful Shamsul Alam & Co.
Chartered Accountants
2. M/s. Aziz Halim Khair Choudhury
3. M/s. Howladar Yunus & Co.
Tax Advisor : M/S. K.M. Hasan & Co.
Registered Office : 40, Dilkusha C/A, Dhaka-1000, Bangladesh
Phone : PABX (88-02) 9563040, 9567161, 9567162
Mobile : 88-01711435638-9
FAX : 88-029564532, 9568634
SWIFT : IBBLBDDH
E-mail : info@islamibankbd.com
Website : www.islamibankbd.com

Corporate Structure

Board and its Committees

Board of Directors Ex-Officio Director
Chairman Managing Director & CEO
Prof. Abu Nasser Muhammad Abduz Zaher
Company Secretary
Repr. of The Ibn Sina Trust
Abu Reza Md. Yeahia
Vice Chairmen Executive Vice President
Yousif Abdullah Al-Rajhi, KSA
Executive Committee
Engr. Mustafa Anwar
Repr. of the Public Institution for Social Security, Safat, Kuwait
Chairman
Engr. Md. Eskander Ali Khan
Directors
Members
Dr. Abdulhameed Fouad Al-Khateeb
Repr. of Al-Rajhi Co. for Industry & Trade, KSA
Mohammad Abdullah Al Jalahma
Mohammad Abdullah Al Jalahma Humayun Bokhteyar, FCA
Repr. of Kuwait Awqaf Public Foundation, Safat, Kuwait. Md. Abul Hossain
Dr. Areef Suleman
Audit Committee
Repr. of Islamic Development Bank, Jeddah, KSA
Chairman
Md. Abul Hossain Professor NRM Borhan Uddin, Ph.D.
Repr. of Investment Corporation of Bangladesh
Members
Dr. Abdulhameed Fouad Al-Khateeb Md. Abdus Salam, FCA, FCS
Repr. of Arabsas Travel & Tourist Agency, KSA Dr. Areef Suleman
Abdullah Abdul Aziz Al-Rajhi, KSA Barrister Mohammed Belayet Hossain
Salahuddin Ahmed
Risk Management Committee
Repr. of Kuwait Finance House, Safat, Kuwait
Chairman
Independent Directors Engr. Mustafa Anwar
Professor NRM Borhan Uddin, Ph.D.
Prof. Dr. A.K.M. Sadrul Islam
Members
Dr. Areef Suleman
Barrister Mohammed Belayet Hossain
Prof. Dr. A.K.M. Sadrul Islam
Md. Abdus Salam, FCA, FCS
Barrister Mohammed Belayet Hossain
Humayun Bokhteyar, FCA
Salahuddin Ahmed

Shari’ah Supervisory Committee
Chairman
Sheikh Moulana Mohammad Qutubuddin Moulana Abdus Shaheed Naseem
Chairman President
Baitush Sharaf Anjuman-E-Ittehad Bangladesh Bangladesh Quran Shikkha Society
Vice Chairman Dr. Hasan Mohd. Moinuddin

Mufti Sayed Ahmad Associate Professor
Head Mufti Deptt. of Islamic Studies
Al Jamiatus Siddikiah Darul Ulum International Islamic University Chittagong
(Madrasah-e-Furfura Sharif), Darussalam, Dhaka
Professor Dr. A. S. M. Toriqul Islam
Member Secretary
Dept. of Dawah & Islamic Studies
Professor Dr. Abu Bakr Rafique Islamic University, Kushtia
Pro-Vice Chancellor
International Islamic University Chittagong Dr. Mohammad Abdus Samad
Associate Professor & Head
Members
Deptt. of Arabic Language & Literature
Principal Mohammad Serajul Islam International Islamic University Chittagong
Ex-Principal
Madrasha-E-Mesbahul Ulum, Dhaka. Dr. Mohammad Monzur-E-Elahi
Associate Professor, Deptt. of Islamic Studies
Abdur Raquib
Ex-Executive President National University
Islami Bank Bangladesh Limited
Moulana Mohiuddin Rabbani
Mufti Shamsuddin (Zia) Muhaddith, Foizul Ulum Madrasa, Dhaka
Mufti, Muhaddis & Head of Academic Affairs Principal, Darul Quran Madrasa Savar, Dhaka.
Al Jameatul Islamiah, Potia, Chittagong

Management Committee
Chairman
Members
Mohd. Shamsul Haque Md. Najibur Rahman
Deputy Managing Director Executive Vice President
Muhammad Abul Bashar Abdus Sadeque Bhuiyan

Md. Habibur Rahman Bhuiyan, FCA Md. Shafiqur Rahman

A.K.M. Abdul Malek Chowdhury Md. Shamsuzzaman

Md. Mahbub-ul-Alam Mohammad Ali

Rafi Ahmed Begh Abu Reza Mohd. Yeahia

Nurul Islam Khalifa Mohammed Shahid Ullah, ACA, CIB, CDCS

Deputy Managing Director Senior Vice President & CFO

Senior Executives
Managing Director & CEO Md. Yeanur Rahman Md. Habibur Rahman
Mohammad Abdul Mannan Mohammod Ullah Md. Abdullah
Deputy Managing Directors Abu Reza Md. Yeahia Zafar Alam
Mohd. Shamsul Haque Md. Altaf Hossain Mohammad Jamal Uddin Mazumder
Md. Nurul Islam (Deputed to Nigeria) Md. Omar Faruk Khan, CDCS Md. Aminur Rahman
Muhammad Abul Bashar Md. Motiar Rahman Md. Shamsul Haque
Md. Habibur Rahman Bhuiyan, FCA Mohammad Jalal Uddin Akbar Mohammad Sayeed Ullah
A.K.M. Abdul Malek Chowdhury Kazi Kamrul Islam Dr. Muhammad Solaiman
Md. Mahbub-ul-Alam Md. Mostafizur Rahman Siddiquee Syed Sirajul Hoque
Rafi Ahmed Begh Md. Faizul Kabir Md. Abdus Sobhan
Nurul Islam Khalifa Md. Giasuddin Ahmed A.K.M. Shahidul Hoque Khandaker
Director General, IBTRA Md. Saleh Iqbal Md. Saidur Rahman
Md. Mahfuzur Rahman Md. Abdul Quddus Mohammed Shahid Ullah, ACA, CIB, CDCS
Executive Vice Presidents Senior Vice Presidents Md. Mahbub-a-Alam
Md. Najibur Rahman Dr. Md. Mizanur Rahman A.K.M. Kawsar Alam
Abdus Sadeque Bhuiyan A.H.M. Latif Uddin Chowdhury Mir Rahmat Ullah
Md. Abdul Jabbar Md. Shahidur Rahman Abul Faiz Muhammad Kamaluddin
Md. Shafiqur Rahman Md. Nizamul Hoque Farid Ahmad
Md. Kabir Hossain Md. Tofazzal Hossain Khan Md. Manjurul Islam
Md. Shamsuzzaman Md. Nayer Azam Md. Akhtar Hossain
Md. Nazrul Islam Khan Ahmed Ali Shahid Uddin Ahmed
Md. Shamsul Huda Rana Mohammad Raihan Abul Kalam Md. Saifullah
Md. Obaidul Haque Engr. Md. Moiz Uddin Md. Mizanur Rahman Mizi
Mohammed Monirul Moula Md. Khalequzzaman Sikder Md. Shehabuddin
Asheque Ahmad Jebal Mohammad Rokan Uddin Md. Rafiqul Islam
Md. Abdur Rahman Banerjee Abu Sayed Md. Idris Mahmud-ur-Rahman
Dr. Mahmood Ahmed Md. Siddiqur Rahman A.K.M. Abu Siddiqui
Md. Mohon Miah K.M. Munirul Alam Al-Mamoon A.T.M. Shahidul Haque
A.A.M. Habibur Rahman A.K.M. Payer Ahammed Md. Anisul Haque
Md. Shafiqul Mawla Dr. Muhammad Kamaluddin (Jasim) Md. Farid Uddin
Mohammed Amirul Islam Md. Qaisar Ali Muhammad Nurul Hoq
Mohammad Ali Salim Anwar Mohammad Sirajul Alam
Md. Kawsar-ul-Alam Md. Abdus Salam Md. Maksudur Rahman
Abu Naser Mohammed Nazmul Bari Mizanur Rahman Md. Faiz Ahmed
Md. Mosharraf Hossain Md. Osman Gani Md. Shahidul Islam
Md. Shahidullah Md. Mahboob Alam
Taher Ahmed Abu Noman Md. Siddiqur Rahman

Directors’ Profile
Prof. Abu Nasser Muhammad Abduz Zaher, Chairman, Islami Bank Bangladesh Ltd. began his
teaching profession in the early seventies and later served in the Royal Embassy of Kingdom
of Saudi Arabia in Dhaka, Bangladesh for a long 13 years as the Secretary. He is now the
Managing Director of Ibn Sina Pharmaceutical Industry Ltd., a prominent pharmaceutical
company in Bangladesh.
He is also the Chairman of Islamic Banks Consultative Forum (IBCF) and Industrialists &
Businessmen Welfare Foundation (IBWF). He is the Vice Chairman of Bangladesh Association
of Banks (BAB) and Advisor to Bangladesh Association of Pharmaceutical Industries.
Prof. Abu Nasser Prof. Zaher was the Director of IBBL in different times and was the Chairman of the Executive
Muhammad Abduz Zaher Committee. He is a founder member and syndicate member of the Manarat International University.
Chairman
Prof. Zaher visited Saudi Arabia several times. He also visited more than 35 countries of the
world including Kuwait, United Arab Emirates, Bahrain, Egypt, USA, Canada, UK, Switzerland,
Austria, France, Germany, Italy, Denmark, Greece, Mozambique, South Africa, Turkey,
Pakistan, Nepal, India, Myanmar, Thailand, South Korea, Japan, Malaysia, Singapore and
participated in many international seminars and conferences. He was awarded by many
local and foreign organizations as the recognition of his deeds in the field of business and
other socio-economic activities.
Yousif Abdullah Al-Rajhi is a Vice Chairman of the Board of Directors and a foreign Director
of the Bank. He completed his graduation in Business Administration majoring in Economics
& Political Science from King Saud University, KSA. in 1986. Then he obtained MA degree
in Development Administration from Western Michigan University, USA in 1991. He also
completed Internal Auditor Course, Change Management & Leadership Course and Speed
Reading and Development Round Attendance Certificate Course.
Mr. Yousif is General Manager-cum CEO of Al-Rajhi Company for Industry and Trade,
KSA with 27 years of work exposure including banking career with Al-Rajhi Banking and
Investment Corporation. He visited various eastern and western countries of the world and
Yousif Abdullah Al-Rajhi
participated in many international seminars, symposia and conferences.
Vice Chairman

Engr. Mustafa Anwar represents the Public Institution for Social Security, Kuwait as
Director in the Board of Islami Bank Bangladesh Ltd. He is a Founder Sponsor of Islami
Bank Bangladesh Limited. Currently he is a Vice Chairman, Board of Directors of the Bank.
He is the Chairman & Managing Director of Birds Group, a large business conglomerate in
the RMG sector of Bangladesh. He was also the Chairman & Advisor of several standing
committees of BGMEA.
Engr. Mustafa Anwar completed his graduation in Civil Engineering from Bangladesh
University of Engineering & Technology (BUET) in 1964 and began his career as an engineer of
Bangladesh Water Development Board (BWDB). He is engaged in various social, educational
and cultural organizations of the country. He worked as the Editor of the Weekly Bikram and Engr. Mustafa Anwar
Vice Chairman, Board &
a Trustee of Darul Ehsan University, Dhaka.
Chairman,
Risk Management Committee
Engr. Md. Eskander Ali Khan represents Al-Rajhi Company for Industry & Trade, KSA as
Director of Islami Bank Bangladesh Ltd. He is the Chairman of the Executive Committee
of the Bank. He is a well-known business person in Real Estate & Poultry Hatchery and
Tourism Sector in Bangladesh. He obtained his graduation in Electrical Engineering from
Bangladesh University of Engineering and Technology (BUET) in 1969. He served for a long
time as electrical engineer in UAE. He is also the Chairman of Islami Bank Securities Ltd.
Director &
Chairman, Executive Committee
Mohammed Abdullah Al Jalahma represents Kuwait Awqaf Public Foundation as a Director

of Islami Bank Bangladesh Ltd. He completed his graduation in Business Administration
from the University of Concordia, Montreal, Quebec in 1985. He has 30 years working
experiences in the field of Charitable Foundation, Zakat House, Investment Department,
Business Administration. At present, he is serving as Deputy Secretary General of Kuwait
Awqaf Public Foundation, Kuwait.
Mohammed Abdullah Al Jalahma is also the member of the Board of Directors of AI Dar
Finance Company and Asian Muslem Committee belonging to the World Charitable
Foundation. Currently he is a member of the Board of Trustees of the Asian University of Mohammed Abdullah Al Jalahma
Women (AUW) in Bangladesh. Director
Dr. Areef Suleman represents Islamic Development Bank (IDB), Jeddah, KSA in the Board
of Directors of Islami Bank Bangladesh Ltd. He holds Ph.D. in Economics and Masters in
Business Leadership. Currently he heads the manager of the Strategy Development Division
at the Islamic Development Bank in Jeddah, Kingdom of Saudi Arabia.
Prior to joining the IDB, Dr. Suleman functioned as CEO of a Government Fund to foster
innovation in South Africa. He was also responsible for jointly establishing and managing
a consulting firm of South Africa’s premier development finance institution wherein he
manages their consulting services on the African continent. Dr. Areef Suleman
Director

Md. Abul Hossain is the General Manager of Investment Corporation of Bangladesh. He

completed B.Sc. (Hons.) in Statistics (with Economics and Mathematics as minor) in 1989
and M.Sc. (Masters) in Statistics in 1990 from Jahangirnagar University, Dhaka, Bangladesh.
He has 20 years of working experience in the field of Govt. Service, Software Development
Company and Specialized Financial Institution. His publication titled “Causes of drug
addiction and suggestions for remedy: Evidence from a micro study”, was published in
Journal of statistical studies, Volume- 12, December 1992, Jahangirnagar University, Dhaka,
Bangladesh. He represents Investment Corporation of Bangladesh in the Board of Directors
of IBBL as elected Director. He also represents Investment Corporation of Bangladesh in
Md. Abul Hossain
the Board of Directors of ICB Securities Trading Co. Ltd., Aziz Pipes Limited as Chairman &
Director NITOL Insurance Company Limited as well as Alltex Industries Ltd. as Director.
Dr. Abdulhameed Fouad Al-Khateeb represents Arabsas Travel & Tourist Agency, KSA
as Director of Islami Bank Bangladesh Ltd. He is a Saudi National having Ph.D in Bio
Medical Engineering and Asstt. Professor of King Abdul Aziz University, Jeddah, KSA. Dr.
Abdulhameed Fouad Al-Khateeb is the founder and CEO of TIME: Technology Management
& Implementation Experts, a consulting firm in Saudi Arabia specialized in Hospital & Health
Care design, Engineering, Biomedical Engineering & Technology and quality.
Dr. Abdulhameed
Fouad Al-Khateeb
Director
Abdullah Abdul Aziz Al-Rajhi is an elected Foreign Director of the Board of Directors of Islami
Bank Bangladesh Limited. He is one of the major contributors of the Paid-up Capital of the
Bank. He began his Banking career with Al-Rajhi Banking and Investment Corporation, the
most reputed Financial Institution in the Royal Kingdom of Saudi Arabia.
Abdullah Abdul Aziz

Al-Rajhi
Director
Salahuddin Ahmed represents Kuwait Finance House, Kuwait as a Director of Islami Bank
Bangladesh Ltd. He also represents as director of Kuwait Finance House Research Limited, a
premier research institution set up exclusively for promoting research in the Islamic Banking
field, apart from other investment research.
Salahuddin Ahmed completed his Bachelor of Commerce Degree from University of Lucknow,
India in 1995. He obtained Post Graduate Diploma in Business Administration (PGDBA) in
1998 and Diploma in Business Finance in 1996 from Institute of Chartered Financial Analyst
of India. He has more than 14 years of working experience in the field of Corporate Finance
Salahuddin Ahmed and Investments.
Director

Md. Abdus Salam FCA, FCS, an Independent Director and a member of the Audit Committee of the Bank,
was the elected President of the Institute of Chartered Accountants of Bangladesh (ICAB) for the year
2013. He has been serving the Institute as the Council Member since 2010. Mr. Salam was
the Board Member of South Asian Federation of Accountants (SAFA) - an Official Body of
the SAARC for the year 2013. He was also a Board Member of Dhaka Stock Exchange Ltd
(2013), Chittagong Stock Exchange Ltd. (2013), Bangladesh Institute of Capital Market, (2013)
of Bangladesh Securities and Exchange Commission, Small and Medium Enterprises (SME)
Foundation (2013). He was in the Board of Governors of National Academy of Planning and
Development, Ministry of Planning, Government of Bangladesh. He is currently serving the
Coal Power Generation Company of Bangladesh as the GoB Nominee.
Md. Abdus Salam, FCA, FCS
Mr. Salam is a Fellow Member of the Institute of Chartered Secretaries of Bangladesh (ICSB)
Independent Director
and also the founder President of Institute of Supply Management Bangladesh. He is a Life
Member of Bangladesh Computer Society and the Bangladesh Economic Association. In
his long career, he served in a number of government, autonomous bodies and multilateral
international development organizations including UNDP, ADB, The World Bank, CIDA, DFID,
NORAD, SIDA, EC, DANIDA under various capacities in the fields of financial management,
auditing and governance. He was associated with the Primary Education Development
Program in Bangladesh having 11 Development Partners including the World Bank and the
ADB. He was also the technical adviser of the IDA Technical Assistance Project for Chartered
Accountants titled, “Development of Accounting and Auditing Standards in Bangladesh”
financed by the World Bank.
Mr. Salam, presented a number of technical papers in the National and International
Conferences, Seminars and Workshops. Being a widely traveled personality, he visited in
United Kingdom, Australia, Canada, Saudi Arabia, UAE, Malaysia, Thailand, India, Pakistan,
Sri Lanka and Nepal.
Humayun Bokhteyar obtained Accountancy Degree from Bangladesh and Australia. He has
long senior level financial management experience with services and manufacturing sectors
in Bangladesh and Australia. He is a Chartered Accountant having exposure over 24 years.
He is also an associate member of Australian Society of Certified Practicing Accountants
and Institute of Cost and Executive Accountant (ACEA), UK.
Humayun Bokhteyar is an Independent Director of Islami Bank Bangladesh Limited since

May 2014. He is the founder and Managing Partner of Public Accounting and Auditing Firm, Humayun Bokhteyar, FCA
M/s. Bokhteyar Humayun & Co., Chartered Accountants.
Professor NRM Borhan Uddin secured Ph.D. in Management from SIT, New Jersey, USA. He
also received his MBA & MS degree from the USA. At present, he is the Vice Chancellor of
City University. He has been the Independent Director of Islami Bank Bangladesh Limited
since July 24, 2010. He is the Chairman of Audit Committee of the Bank.
Prof. NRM Borhan Uddin, Ph.D.

& Chairman, Audit
Committee

Prof. Dr. A.K.M. Sadrul Islam is an Independent Director of Islami Bank Bangladesh Limited
since December 29, 2012. He completed his M.Sc. Engineering from Bangladesh University of
Engineering & Technology (BUET) in 1984 and got his Ph.D. in Mechanical Engineering from
Imperial College of Science & Technology, University of London, UK in 1988. He was former
Head and Professor of Mechanical Engineering Department of BUET and presently a Professor
of Mechanical & Chemical Engineering Department and Head of Civil & Environmental
Engineering Department of Islamic University of Technology, a subsidiary of OIC. He has
also attained many Scholastic Awards/Fellowships like Guest Professor at Saga University,
Japan, Visiting Professor, at University Technology of Malaysia, INSPIRE Exploratory Grant,
Prof. Dr. A.K.M.
UK, British Commonwealth Visiting Research Fellow at Loughborough University, UK.
Sadrul Islam
Dr. Islam was the Chairman of Mechanical Engineering Division of Institution of Engineers,
Bangladesh (IEB) and currently the Secretary General of Bangladesh Society of Mechanical
Engineers (BSME). He is the Member of Board of Trustees of the Ibn Sina Trust (IST) and
Director of the Ibn Sina Pharmaceutical Industry Limited (IPI).
Barrister Mohammed Belayet Hossain is an Independent Director of Islami Bank Bangladesh

Limited since December 29, 2012. After obtaining LLM degree from the University of
Chittagong, he obtained Barrister-at-Law by the Honourable Society of Lincoln’s Inn, London.
He is a member of the Executive Committee of the Institute for Research and Development
(IRD). He is a General Secretary of the Integrated Education and Research Foundation (IERF).
Barrister Hossain is a regular practitioner in the Supreme Court of Bangladesh. He acted

thrice as one of the Panel Judges of the International Committee of the Red Cross (ICRC).
Barrister Mohammed
Belayet Hossain

Corporate Governance Report
Finance Minister awarding IBBL the ICMAB Best Corporate Award
C
orporate Governance structure of IBBL specifies The Board is comprised of experienced members from
the rights and responsibilities among different diverse professions like businesses, administration, banking
stakeholders of the Bank through a set of rules, & finance, accounting, general management, teaching,
policies and practices keeping focus on proper delegation, Shari’ah experts, Barrister, engineers and fund managers
which make the Board very effective and balanced in
transparency and accountability in the organization as a
deciding and directing various issues of the Bank.
whole. The structure has been developed in line with the
accepted Corporate Governance practices and guidelines Board Size
of Bangladesh Bank and the Bangladesh Securities and
The Board consists of 15 (fifteen) non-executive members
Exchange Commission’s (BSEC) notifications in this regard. including 05 (five) Independent Directors excluding the ex-
The Bank has attached utmost importance in setting up a officio Managing Director. The number of Board members
well-defined compliance culture throughout the organization. is within the limit set by Bank Company Act 1991 (amended
upto 2013) and BSEC notification on Corporate Governance.
Board of Directors, Chairman and the CEO Selection and Appointment of New Directors
Policy on Appointment of Directors The selection and appointment of new directors and the re-
appointment of existing Directors are being made in line with
The members of the Board of Directors of IBBL are the following obligations and duties:
appointed pursuant to the provision of Companies Act 1994,
1. Frequent assessment of the size and structure of the
Bank Company Act 1991 (Amended up to 2013), Bangladesh Board and the mix of knowledge, skills, experiences and
Securities and Exchange Commission (BSEC) Notifications, perceptions that may be necessary to allow the Board to
Guidelines of Banking Regulations and Policy Department perform its functions.
(BRPD) of Bangladesh Bank and Memorandum & Articles
2. Recognizing the capabilities and following the approved
of Association of the Bank. Independent Directors have been procedure to ascertain that an applicant designated by the
appointed by the Board as per regulatory requirement. shareholders possesses the same.

Meeting of the Executive Committee
The directors are selected by the shareholders in the Annual Bank Company Act, 1991 (Amended upto 2013) and other
General Meeting. Casual vacancy, if any, are filled up by the laws and regulations.
Board in accordance with the conditions mentioned in the
Companies Act and Articles of Association of the Bank. The Audit Committee
Retirement and Re-election of Directors The Audit Committee of the Bank, comprising of 4 (four)
Members, has been formed in compliance with Bangladesh
As per Companies Act and Articles of Association of the Bank & BSEC guidelines. The company secretary acts as the
Bank, each year one-third of the Directors retire from office secretary of the Committee.
and being eligible, may offer themselves for re-election by
shareholders at the Annual General Meeting. In line with The Risk Management Committee
the requirement of Bank Company Act, no Director should
serve more than 3 years without seeking re-election at In order to formulate and implement appropriate strategies
shareholders’ meeting. for risk assessment, its control and management, a Risk
Management Committee, comprised of 5 (five) members,
Directors’ Profile and Their Representation has been formed. The Committee monitors risk management
in the Board of other Companies policies & methods and reviews the risk management
process to ensure effective prevention and control measures.
Incorporated in the Directors’ profile
Roles and responsibilities of the Risk Management
Formation of Supporting Committees
committee
The board formed an Executive Committee, an Audit
Committee and a Risk Management Committee. There is Identification and controlling strategies of risks
no committee or sub-committee of the Board other than the n Formulation of organization structure
above mentioned Committees. However, it has a Shari’ah n Reviewing and resolving risk management policy
Supervisory Committee to look after the Shari’ah matters and n Information/documents preservation and reporting
gives suggestions to the management on Shari’ah issues.
n Follow-up the implementation of risk management
The Executive Committee policy as a whole
The Executive Committee is comprised of 5 (five) members. Non-Executive Director
The Executive Committee is responsible to the Board of
Directors. The duties of the Executive Committee are clearly All the members of the Board of Directors, except the
set forth in writing. The company secretary acts as the Managing Director, are non-executive directors.
secretary of the Committee.
Independent Directors and their Independence
Roles and Responsibilities of the Executive Committee
The Board has 05 (five) Independent Directors in conformity
The Executive Committee exercises all the powers of the with the corporate governance notification and guidelines of
board except those specifically given to the board by the regulatory authorities. The Independent Directors enjoy full

independence in discharging their responsibilities and they Commission notification No. SEC/CMRRCD/2006-158/ 134/
are well conversant in the field of business and professional Admin/44, dated 07 August 2012 in the directors’ report
areas. The independent directors have required qualifications prepared under section 184 of the Companies Act, 1994 (Act
and corporate management/ professional experiences as No. XVIII of 1994).
stipulated in BSEC notification as well as Bangladesh Bank
guidelines. Independence of Non-Executive Directors
Chairman is Independent of Chief Executive Officer All the members of the Board of Directors, except the
(CEO) Managing Director, are non-executive directors. They are
independent in expressing their views and opinions. The
The Chairman is Independent of the CEO. The Chairman of
the Bank is elected by the directors of the Bank and the CEO directors are also independent from management and other
is being appointed by the Board of Directors upon permission relationships of the Bank that could materially affect the
from Bangladesh Bank. The Board of Directors has clearly activities of the Bank. They also adhere to the corporate
defined the roles and responsibilities of the Chairman and governance practices and guidelines.
the CEO.
Responsibilities of the Board of Directors
Responsibilities of the Chairman
The main responsibility of the Board is to ensure good
The responsibilities of the Chairman as defined in the BRPD governance in the Bank Management. The Bank Company
Circular No.11 dated 27 October, 2013 of Bangladesh Bank is Act, 1991 (amended upto 2013) gives responsibility to the
fully complied with. The Chairman of the Board of Directors Board of Directors for establishing policies for the bank,
does not personally possess the jurisdiction to apply policy for risk management, internal controls, internal audit and
making or executive authority. He does not participate in or compliance and for ensuring their implementation. Keeping
interfere into the administrative or operational and routine in view, the Board of Directors exercises business judgment
affairs of the Bank. in good faith, in a manner that they reasonably believe to
be in the best interest of the Bank, while complying with
The Chairman conducts on-site inspection of any bank- the applicable laws and regulations, the Bank’s Articles of
branch or financing activities under the purview of the Association and resolutions adopted by the shareholders.
oversight responsibilities of the Board. If needed, he calls
for any information relating to Bank’s operation or ask Annual Appraisal of the Board’s Performance
for investigation into any such affairs and submits such
information or investigation report to the meeting of the In every Board meeting, the attendance of the Directors is
Board or the Executive Committee. With the approval of the registered and they actively participate in various agenda.
Board, he takes necessary action there against in accordance The performance of the Board is appraised in various ways
with the set rules through the CEO, if deems necessary. The through submission of the performance of the bank in the
Chairman enjoys some specific benefits from the Bank as Board meeting periodically, preparation and monitoring
stipulated in Bangladesh Bank guidelines. of budget variances, placing the implementation status of
the Board’s decisions, transacting business issues which
Code of Conduct for the Board of Directors are within its power and placing implementation status
of Bangladesh Bank’s observations on various issues.
The Board of Directors follows a code of conduct adopted Furthermore, the performance report of the committees
to provide guidance to directors to carry out their duties framed by the Board is also placed in the Board through
in an honest, responsible and business like manner and which the performance of the Board is regularly evaluated.
within the scope of their authority, as set forth in the laws
of the country as well as in the Memorandum and Articles of Annual Evaluation of the CEO’s Performance by the
Association of the Bank. Board
Every Director assures annually signing a confirmation that The Board of IBBL has the policy of annual evaluation of its
they have gone through, have complied with and will continue Managing Director and CEO’s performance. Moreover, the
to comply with the set of codes approved by the Board of performance of the CEO is evaluated by the Board through
Directors by BSEC, by Laws and by Bangladesh Bank. various reports like performance report of the Bank, taking
Directors’ Report to Shareholders status of various assignments given by the Board to the
CEO and the Management, taking implementation status
The Directors’ Report of the Bank includes all statements of Budget which includes the Key Performance Indicators
regarding section 1.5 of Bangladesh Securities and Exchange (KPIs) of the Bank etc.

Responsibilities and Authorities of the CEO & well conversant in the field of business, administration and
Managing Director professional areas.
The CEO & Managing Director of the Bank discharges the Accountability, Audit and Financial Reporting
responsibilities and exercises the authorities as follows:
The Board undertakes responsibilities for preparing and
(a) The CEO & MD ensures compliance of the Company Act presenting a balanced and comprehensive assessment
& the Bank Company Act and/or other relevant laws of the bank’s operations at the end of the each financial
and regulations in discharge of routine functions of the year through annual Financial Statements and Annual
Bank. Report and quarterly and half yearly announcement of
(b) He submits information on violation of any law, rules, financial performance of the bank to the Shareholders. The
regulation including the Bank Company Act, while Audit Committee of the Board assists in this respect by
presenting memos before the board or the committee scrutinizing the information to be disclosed, and to ensure
formed by the board. accuracy, adequacy, transparency and completeness of the
(c) He provides all information to Bangladesh Bank on the disclosed information.
violation of the Bank Company Act, and/or any other
laws, rules and regulations. Number of Board Meetings
(d) The recruitment and promotion of all staffs of the In 2014, 17 (seventeen) Board meetings were held. A
Bank except those in the two tiers below him rest on detailed disclosure showing number of Board Meetings held
the CEO & MD. He acts in such cases in accordance and status of participation of the Directors is given in the
with the approved service rules on the basis of the later part of the report.
human resources policy and sanctioned manpower
planning approved by the Board. The authority relating Directors’ Report on Compliance with Best Practice
to transfer and disciplinary measures against the on Corporate Governance
employees, except those at two tiers below the CEO & Status of compliance of corporate governance checklist is
MD is delegated to him, which he applies in accordance included in the Directors’ Report, which is dully certified by
with the approved service rules. Besides, under the external auditor other than Bank’s Statutory Auditors.
purview of the human resources policy as approved
by the board, he nominates officers for training, skill Appointment of CFO, Head of Internal Audit and
development Programe etc. Company Secretary
Policy on Training of Directors The Bank appointed a Chief Financial Officer (CFO), a Head
of Internal Audit (Internal Control and Compliance) and a
As per Bangladesh Bank guidelines, the directors shall make
Company Secretary (CS) as per guidelines of regulatory
themselves fully aware of the banking laws and other related
authorities. The Board of Directors clearly defined the roles,
rules and regulations for performing their duties properly.
responsibilities and duties of the CFO, the Head of Internal
The policy on training of Directors includes providing training
Audit, and the CS.
and updated information on all the latest policy guidelines,
circulars and Acts issued by the regulatory/legislative Role of the Company Secretary
authorities. Sometimes special discussion sessions are
Company Secretary is responsible for advising the Board on
arranged with the experts. They also attend the programs issues relating to corporate compliance with the relevant
organised by various professional bodies at home and laws, rules, procedures and regulations affecting the Board
abroad on technical, professional and corporate governance and the Bank, as well as best practices of governance. He
issues. During 2014, two directors attended two international is also responsible for advising the Directors regarding their
training organized by World Islamic Economic Forum (WIFE) obligations and duties to disclose their interest in securities,
and World Conference on Professional Accountants. disclosure of any conflict of interest in a transaction
involving the Bank, prohibition on dealing in securities and
Directors’ Knowledge and Expertise in Finance and restrictions on disclosure of price-sensitive information.
Accounting
Attendance of CFO and Company Secretary
Two Directors in the Board of the Bank are professionally
qualified Chartered Accountants. They are well conversant The CFO and the Company Secretary of the Bank attend
in the field of accounting and finance to provide guidance in meetings of the Board of Directors, excluding those, which
the matters applicable to accounting and auditing standards involve consideration of an agenda item relating to their
to ensure reliable financial reporting. Other Directors are also personal matters.

Small Entrepreneur Friendly Bank Award by Bangladesh Bank
Vision, Mission and Strategy Committee while other members of the Management attend
the Committee Meeting on invitation only.
n The Vision and Mission of the Bank are approved by the
Board of Directors. These are disclosed in the annual Chairman of the Audit Committee
report, bank’s website and other publications.
n Business Objectives are focused and the areas of The Chairman of the Audit Committee is an Independent Non-
business are set out to attain vision, mission and Executive Director and he performs his duties independently.
strategic objectives.
Terms of Reference of the Audit Committee
n The Strategies to achieve the Business Objectives are
clearly set out and disclosed in the previous section of The Audit Committee strictly observes the Terms of
this annual report. Reference of the Committee issued by the Bangladesh
Bank through BRPD Circular no. 11 dated 27 October 2013
Audit Committee and BSEC. As per the terms of the said Circulars, the Audit
Committee plays a key role in finalization of the Financial
The Board approves the objectives, strategies and overall
Statements of the Bank. It also reviews the Internal Control
business plan of the Bank while the Audit Committee
System of the Bank, Internal Audit Reports, External Audit
assists the Board in fulfilling oversight responsibilities.
Reports, Bangladesh Bank’s Inspection Reports, Shari’ah
The Audit Committee also assist the Board in ensuring the
Inspection Reports and provides necessary Policy Guidelines
financial statements reflect true affairs and ensures a good
as required. The Committee is empowered to investigate/
monitoring system within the business. The Audit Committee
question any employee of the Bank. It can also take External
is responsible to the Board of Directors. The roles of the Audit
Expert Counsel, if it deems necessary.
Committee are clearly set forth in writing. The Company
Secretary acts as the Secretary of the Committee. At least Audit Committee Comprises of Non-Executive
two Independent Directors are required to form the Audit Director
Committee and at least one Independent Director is required
to fulfill the quorum of the Audit Committee meeting. All the Members of the Audit Committee are Non-Executive
Directors. No executive of IBBL is eligible to become a
Appointment and Composition member of the Audit Committee.
Audit Committee of the Bank, comprising of 4 (four) Members, Expertise in Finance and Accounting
has been formed in compliance with Bangladesh Bank & the
All the members of the Audit Committee have adequate
BSEC guidelines among which 03(three) are Independent
knowledge in Accounting and Finance. Of them, one is the
Directors. Company Secretary acts as the Secretary of the

senior most fellow member of the Institute of Chartered Accounting Standards (IAS) and International Financial
Accountants of Bangladesh (ICAB) and Institute of Chartered Reporting Standards (IFRS) adopted as Bangladesh
Secretaries of Bangladesh (ICSB). He also served as the Accounting Standards (BAS) and Bangladesh Financial
President of ICAB for the year of 2013. One of the members Reporting Standards (BFRS) by the Institute of Chartered
is the Vice-Chancellor of a Private University having Ph.D in Accountants of Bangladesh, requirement of the Bank
Management from SIT, New Jersey, USA. Another member Company Act, the Companies Act, the Bangladesh Securities
of the Committee also has Ph.D in Economics & Masters in and Exchange Rules, the Dhaka and Chittagong Stock
Business Leadership. Another member of the Committee is Exchange, Listing Regulations and other Laws and Rules
a Barrister-at-Law. applicable in Bangladesh and Standards issued by the
Accounting and Auditing Organization for Islamic Financial
Access of the Head of Internal Control and Institutions (AAOIFI), Manama, Bahrain, etc.
Compliance to the Audit Committee
Review of External Audit Functions
The Head of Internal Control has the direct access to the
1. Effective Coordination of External Audit Functions:
Audit Committee. Head of Internal Audit or any other Officer
Before finalization of the Financial Statements, the
attends the meetings of the Audit Committee, if it deems
Committee met with the External Auditors and discussed
necessary.
various issues relating to Financial Statements.
Review and Evaluation of Quarterly Report 2. Ensure Independence of External Auditors: The
Committee tries to ensure that the External Auditors
The Audit Committee reviews and evaluates the quarterly
perform the Audit with due independence.
performance including the financial reports and refers the
same to the Board. 3. Review of External Auditors’ Findings: The Committee
reviews findings of External Auditors, suggests to take
Meeting of the Audit Committee
action on each items and necessary instructions
The Audit Committee conducted 24 meetings during the are given to the Management on the findings of the
year 2014. The attendance status of the meeting is given at Auditors.
the end of this Report. 4. External Auditors’ Appointment and Reappointment:
Every year the Audit Committee recommends
Objectives & Activities of the Audit Committee Appointment/Re-appointment of External Auditors.
Review of Internal Control 5. Non-Audit Work: External Auditors are not assigned
with any non-audit work thus does not arise any room
The Audit Committee regularly reviews the Internal
to compromise with their independence.
n
Control System of the Bank.

n It ensures that the Internal Control Systems are well Selection of Appropriate Accounting Policies
conceived by all concerned and properly administered The issues related to selection of appropriate Accounting
at all levels to the extent that Management implements/ Policies in line with International Accounting Standards
carries out its instruction/advice. (IAS) and International Financial Reporting Standards
n The Committee monitors observance of Internal Control (IFRS) adopted as Bangladesh Accounting Standards (BAS)
Practices at a regular interval. and Bangladesh Financial Reporting Standards(BFRS) by
the Institute of Chartered Accountants of Bangladesh and
n The Committee also tries to evaluate whether the internal
other Regulatory Guidelines were discussed in the meeting
audit functions have been conducted independently
of Audit Committee. The Accounting Policies are annually
from the management.
reviewed at the time of finalization of Financial Statements.
Role of the Audit Committee in Ensuring Regulatory
Compliance Annual and Interim Financial Releases
The Audit Committee reviews and examines the financial The Audit Committee reviews the Annual and Interim
statements of the Bank every year to see whether all the Financial Statements and recommends the same to the
disclosures & information have been incorporated in the Board for approval.
Financial Statements properly and following International

Reliability on the Management Information As per guidelines of Bangladesh Bank, Internal Control
& Compliance Wing of IBBL prepares the quarterly
The Audit Committee ensures that all the information used reports on the Audit findings and places the same to
for computation of financial disclosures are reliable to the the Audit Committee and to the Board for their perusal
extent that Management submits reliable data. and guidance.
Review Statement of Significant Related Party Bank’s Audit Teams conduct Audit & Inspection of all
Transactions Branches/SME /Agriculture Branches/Zonal Offices,
Wings/Divisions/Departments of Head Office. Heads of
The Audit Committee regularly reviews the statement of 14 Zonal Offices also inspect the branches on quarterly
significant related party transactions, if any, and reports to basis. Incumbent/In-charges of branches also conduct
the Board, as appropriate. their Self-Audit during the period on half yearly basis.
Attendance of the Chairman as well as the Members ii. Compliance Division: The Compliance Division handles
of the Audit Committee in AGM the Regulatory issues of Bangladesh Bank and other
Regulatory Bodies and submits implementation status
The Chairman as well as all the Members of the Audit
of Regulatory issues on quarterly basis to the Audit
Committee attend at the Annual General Meeting of the
Committee.
Bank.
The Compliance Division ensures that Bank complies
Internal Control with all Regulatory requirements while conducting
its day-to-day businesses. They maintain liaison with
Directors’ Responsibility to Establish and Maintain the Regulatory Bodies for any Regulatory changes and
Internal Control notify the same to all concerned. The Division works for
ensuring compliance culture in the Bank.
The Board of Directors is responsible to establish and
maintain appropriate system of Internal Control. To ensure iii. Monitoring Division: Monitoring Division evaluates/
appropriate level of Internal Control System, a good number assesses/monitors the operational performance of the
of Standard Operating Manuals and Policy Guidelines have branches based on the relevant Data/Audit Reports
been introduced in line with global best practices and and analyzes those to assess the risk of branches and
Regulatory Guidelines. Delegation of powers in various submits report to the Management. They help the Audit
business, administrative and financial areas have also been and Inspection Division to formulate Risk Based Audit
approved by the Board. and Inspection Program for the branches.
Features of Internal Control, Compliance and The Monitoring Division also ensures internal check at
Monitoring System the time of performing certain functional areas through
different tools like: DCFCL (Departmental Control
Internal Control and Compliance Wing (IC&CW) is Functions Checklist), QOR (Quarterly Operation Report)
responsible for checking compliance of Internal Control and IDCL (Investment Documentation Checklist)
System. Any deviation is reported to the top Management, following Bangladesh Bank Guidelines. The Audit
Audit Committee and to the Board and necessary steps are Committee periodically reviews all the issues.
taken to rectify the same.
As per Bangladesh Bank Guidelines and to strengthen the Review of Adequacy of Internal Control System
Control and Compliance Mechanism, the Bank has formed The Board of Directors time to time reviews the Internal
Internal Control and Compliance Wing consisting of three Control System of the Bank and necessary guidance are
separate Divisions: provided to improve the system.
i. Audit & Inspection Division: This Division undertakes
the audit and inspection of all operating units of the Control Activities and Segregation of Duties
Bank including Head Office, based on an Audit Plan,
duly approved by the Audit Committee of the Bank. Control mechanism is an integral part of the daily activities
of the Bank. An effective internal control system requires

that an appropriate control structure be set up, with control Risk Management
activities defined at every business level, which is ensured in
the Bank. The control mechanism includes top-level reviews, Identification of the Risks
appropriate activity controls for different departments or
divisions, physical controls, checking for compliance with Risk Management Wing (RMW) has been introduced as per
exposure limits and follow-up on non-compliance, etc. the guidelines of Bangladesh Bank. The Wing is responsible
for identification and management of risks faced by the
Inspection by Bangladesh Bank Bank. The details of internal and external risk management
mechanism are included in Risk Management disclosures.
The Bangladesh Bank conducted the Comprehensive
Inspection on Head Office and 131 Branches of IBBL in 2014. Strategies Adopted to Manage and Mitigate Risk
Moreover, Bangladesh Bank Inspection Team conducted Number of steps have been taken to manage and mitigate
inspection on our Head Office & 12 Branches during the year risks of the Bank. A detail of the same is included in Risk
2014 on Foreign Trade and Foreign Currency Transactions, Management disclosures.
Core Risk areas including others i.e. Consumer Financing,
Small Enterprise Financing functions were also inspected by Ethics and Compliance
Bangladesh Bank inspection team.
IBBL gives due importance to the moral concerns in order
Internal Audit to make the ethical decisions in every aspect of operations.
IBBL believes that upholding the interest of the customers,
1. Audit Committee evaluates the independence status of employees and regulators is very crucial for sustainable
internal of the audit from management; growth and development of the country.
Enforcement of corporate code of ethics requires clear

2. It reviews the internal audit activities and organizational
understanding of the same and active participation by
structure to confirm removal of all hindrances/
everyone in the Bank since the code spells out the expected
limitations/deficiencies;
standards of behaviour and sets the ideal operating
principles to be followed. Every official is encouraged at
3. The Committee assesses the efficiency and
all times to maintain high ethical standards and adequate
effectiveness of the internal audit and
internal control measures to guard against the occurrence
of unethical practices and irregularities.
4. It also assess as the consideration of management on
observations/recommendations given by the internal Statement of Ethics and Values
auditors after any irregularities detected by them
IBBL has adopted the Core Values, Commitments and Code
External Audit of Conduct, Ethical Principles and the likes which have been
clearly spelled out in the earlier section of the report.
In the 31st, Annual General Meeting held on May 31, 2014,
the Shareholders appointed Syful Shamsul Alam & Co., Communication of Statement of Ethics and
Chartered Accountants, Aziz Halim Khair Choudhury, Business Practices
Chartered Accountants and Howladar Yunus & Co., The Code of Conduct/Ethics and Business Practices are
Chartered Accountants to audit the Financial Statements approved by the Board of Directors and circulated those
and Nostro Accounts of the Bank for the year 2014. for acknowledgement and meticulous compliance of all
Statutory Auditors audited 69 Branches and Head Office as employees.
part of the Annual Audit Program, which covered 80% of the
Board’s Statement on Ethics and Compliance
Risk-Weighted Assets of the Bank.
The Board of Directors is committed to introduce high level
Statutory Auditors also submitted a Management Report.
of code of conduct and ethical principles. It also monitors
This Report was discussed in the Meeting of Audit Committee
strict compliance of the same.
and sent to Bangladesh Bank as per requirement. The Audit
Committee also monitors its compliance.

Effective Anti Corruption and Anti-Fraud Program to the notice of competent authority. Central Complaint Cell
has been established and a vigilance team has also been
IBBL arranges anti fraud and anti corruption program as formed to protect the fraud and error. Risk Management Wing
per the guidelines of regulatory authorities to prevent the (RMW) also acts as the whistle blower.
occurrence of any fraud & corruption and all tiers of the
employees are being constantly trained on the issues.
Remuneration Committee
Integrity
Committee Charter
The Directors along with the employees of the Bank always
Bangladesh Bank guidelines do not permit to form a separate
discharge their duties in good faith in order to win the trust
committee of the Board on remuneration. As such, IBBL does
& confidence of the stakeholders and maintain long-term
friendly relationships with the customers, local communities not have such committee. However, the Board of Directors
and shareholders. time to time reviews and evaluates the remuneration paid to
all level of employees, directors and others.
National Integrity Strategy
Composition
The government of Bangladesh has formulated ‘National
The remuneration is decided by the Board of Directors where
Integrity Strategy’ to bring about good-governance in
all the members are non-executive directors. The Managing
the state, its institutions as well as in every walks of the
Director, Deputy Managing Directors, Head of Human
society with a view to establishing a happy, prosperous
Resources, CFO and other related officials work on the issue
and corruption free country. In line with the government’s
as per guidance of the Board.
decision & guidelines of Bangladesh Bank regarding the
matter, the management has formed an ‘Ethical Committee’,
Policies on Remuneration
fixed ‘Focal Point’ and drawn an exhaustive action plan to
develop the efficiency & ethical standard of manpower, Key policies to decide the remuneration of directors, senior
ensure effective compliance of existing laws, strengthen management and employees include market trend, inflation,
e-governance, review the reward & recognition policy for job requirement, position in other banks in the same area etc.
good performers, launch extensive awareness program
among the stakeholders toward materializing the vision of Meetings on Remuneration Issues
this initiative.
Several meetings of the executives and related Board
Conflict of Interest meetings were held to finalize some benefits paid to the
employees during the year 2014.
The Bank does not condone any form of conflict of interest
be its personal, financial or familial interest that can in Remuneration of Directors, Chairman, Managing
any way keep the individual refrain from acting in the best Director and Senior Executives
interests of the Bank or may compromise the interest of
the same, its shareholders as well as the clients. All the Honorarium paid to the Directors and others for attending
employees are required to refrain from any activity, which meetings are as follows:
may result in any conflict or potential conflict of interest. Any
actual or potential conflict of interest must be reported to Board Meeting / Shari’ah Supervisory Committee Meeting
the Management as soon as it is recognized for immediate Tk.5,000.00
solution of the same. The Bank has distinctive procedures to
Executive Committee / Other Board Sub-Committee Meeting
know the information as to whether a Director has an actual
Tk.4,000.00
or potential conflict of interest.
As per the directive of Bangladesh Bank, IBBL has provided
Whistle Blowing Policy only the following facilities to the Directors:
Some organic structures have been evolved to fulfill the n The Chairman of the Board of Directors is provided
purpose of the whistle blowing policy of IBBL aiming to
with a car, a telephone, an office chamber and a private
promote the transparency as well as to serve as a channel
secretary.
of corporate fraud risk management. The system enables
an employee, who has a legitimate concern on an existing or n In addition to the above, Directors are entitled to fees
potential wrong-doing, to raise the issues and bring the same and other benefits for attending the Board, Executive

Executive Development Program
Committee, Audit Committee, Risk Management Succession Planning

Committee and Shari’ah Supervisory Committee
meetings. Efficient succession planning is an integral part of efficient
employee management and IBBL possesses a sound
n Managing Director is paid salaries and allowances as succession plan to carefully avoid the problems of leadership
per approval of the Board and Bangladesh Bank which is vacuum under any circumstances.
separately disclosed in the Financial Statements.
n The senior management is remunerated as per standard Merit Based Hiring
pay structure of the Bank being approved by the Board of
Hiring of committed, dedicated and meritorious human
Directors.
resources is the integral part to run the organization smoothly
The Bank has fully complied with Bangladesh Bank and efficiently. IBBL generally recruits heterogeneous work
circulars and instructions in this regard. forces having diversified academic background and make
the same homogeneous through extensive development
Human Capital process. The recruitment policy has duly been approved by
the Board, which is being followed meticulously to ensure
Human Capital is the set of skills which an employee recruitment & placement of right person for right position.
acquires on the job, through training and experience, and In order to make the organization more vibrant & effective,
which increase employee’s value in the marketplace. Being additional 870 employees have been recruited in 2014.
a value driven organization, IBBL considers its employees
as the most precious capital of the organization that play Performance Appraisal System
the vital role in materializing the mission, vision, goals and
objectives of the bank. IBBL follows a well-structured performance appraisal system
(commonly known as ACR) for evaluating the performance
of the employees. Introduction of a daily basis job-based
Human Resources Development ‘Automated Performance Evaluation (APE)’ process is under
Development and management of human resources is trial operation.
vital to ensure sustainable growth and development of an
organization. This approach is a framework for helping the Promotion, Reward & Motivation
employees to develop their personal and organizational IBBL follows structured human resources policy in awarding
knowledge, skills and abilities by means of extensive promotion, reward and recognition to its employees. In
improvement process covering systematic training, 2014, IBBL awarded promotion to a large number of eligible
motivation, coaching, counseling, mentoring and the likes. employees keeping in view the quality of their respective job
delivery and performance.

Orientation Program for Probationary Officers
Training and Development previous years, IBBL placed great emphasis on the training
The training is not for the training’s sake rather it is imparted of its managers for developing their leadership qualities.
with the objective to ensure balanced improvement of its Moreover, the annual meeting with the employees plays a
employees’ professional knowledge & skill, tempered by vital role in making sure that the strategy and objectives
elevated ethical spirit and enthusiasm. IBBL always strives for each year are clearly communicated and executed. It
for excellence in improving the ethical and professional is significantly important that those who drive company’s
standard of its employees. IBBL provides training to its success are fully informed of its vision, strategy, and focus
employees throughout the year in its own training institute for the year and know what kind of contribution is expected
as well as in various training providing institutes at home from them as individuals in order to achieve these.
and abroad.
Grievance Management and Counseling
Careers and Developments
The people of IBBL are the part of a culture of integrity and All the employees reserve the right to lodge any complaint
leadership, in which they always play an active role. They both internally and externally and the Human Resources
form a community wherein people are potential and talents Division ensures full confidentiality of the same. The
are cultivated with the aim of establishing lifelong careers. Vigilance Squad of the Bank with professional approach
The potential and talented employees are trained and handles the complaints so lodged. In addition, a 24-hour
fostered, with the goal to develop tomorrow’s leadership. hotline number is available to lodge any irregularities at
any time, which are accordingly redirected to the respective
Leadership is certainly one of the strongest elements department for necessary action.
fostered by IBBL seeking to demonstrate leadership both in
the industry as well as in the society where it operates. In Bank’s Contribution towards the Staff
order to sustain this element of leadership, strong emphasis
is placed on developing the employees through in-house IBBL is pledge bound to treat all the employees with dignity
training programmes as well as by supporting educational and respect. The bank strives to maintain a comfortable
opportunities outside IBBL. working environment, irrespective of individual differences.
A high quality and competent human resource is essential to
As a forward-looking enterprise, IBBL strives to continuously ensure sustainable growth and development of any business
stimulate its employees to uphold the state of the art entity, which can only be achieved by means of improving
technology in their respective fields. In order to inspire trust the skill, knowledge and productivity of the employees. The
and create added customer value, great emphasis is placed bank leaves no stone unturned in developing its human
on maintaining employees’ knowledge and skills through resources in all respects to materialize the cherished goals
training, development and informative feedback. Like & objectives.

Healthcare, Safety Standards and Modern Working make it the best place to work in by creating a congenial,
Environment healthy, caring and productive environment for all levels of
staffs. Feedbacks are obtained from the line managers with
IBBL is the pioneer of welfare banking in the country which a view to enhancing the work environment and to providing
constantly endeavors to do something for the prosperity prompt and appropriate welfare services. Management
and well-being of the citizens as well as of its employees. always try to care the family members of its employees
A good number of welfare programs aiming to employee- through various socio cultural activities.
welfare, healthcare, safety standards & working environment
Human Resource Strength
covering the followings are there in IBBL:
Category 2014 2013
Fringe Benefit Schemes
Executive 436 411
n Non-refundable financial assistance from Employees’ Officer 8,160 7,708
Benevolent Fund
Sub-Staff 2,078 2,048
n Non-refundable financial grant from bank’s fund
Sub total 10,674 10,167
n Staff House Building investment facilities
Rural Development Scheme (RDS) 2,532 2,454
n Staff Household Durables Scheme
n Quard against Provident Fund Others (Temporary) 368 359
n Quard against Benevolent Fund Total Manpower 13,574 12,980
n Leave encashment Total Branch 294 286
n Burial expenses Per Branch Employee 46 44
n Recreation program (including RDS & others)
n Honorarium for passing Banking Diploma examination Per Branch Employee 36 35
n Awarding of scholarships to help educate the (Excluding RDS & others)
meritorious wards of the employees
Human Resources Accounting
n Awarding of cash prize and certificate of merit to the
meritorious wards of bank employees Human resource accounting is the process of identifying
n Awarding of prize against essay competition and measuring the data about human resources and
n House rent allowance communicating the information to the interested parties.
n Conveyance allowance Human Resources Division is also involved in Human
n Medical allowance to each employee resources accounting to transform the employees into
n Doctor’s service for the employees the “human assets” or “human capital” that provide
n Car Investment Scheme future benefits. Towards implementing human resource
n Car maintenance allowance accounting standard, IBBL adopts transparent disclosure
n House maintenance allowance practices regarding its human resources.
n Mobile phone allowance Total Workforce by Age Distribution
n Utilities allowances
n In order to provide highly sophisticated and encouraging 79% of manpower are aged below 40 years which signifies
working environment, all the IBBL offices including head that IBBL is in young, energetic and competent hands.
office and branches are equipped with modern facilities
with air-conditioning and generator for power back up. Age Group Female Male Total
n All IBBL offices including head office and branches are
Below 30 309 2,848 3,157
equipped with fire fighting material and have multiple
exit points for emergency exit. 30-40 218 7,512 7,730
IBBL- A Family 41-50 16 2,119 2,135
The Bank consolidated the ‘A-Bank A-Family’ concept Above 50 - 552 552
since its inception and sought to create a work culture that
Total 543 13,031 13,574
sufficiently motivates the work force. The Bank’s goal is to

Orientation Program for Assistant Officers
Training Programs as at 31 December 2014 and social sustainability. GRI provides all companies and
organizations with a comprehensive sustainability-reporting
Sl. Particulars No. of Persons framework that is widely used around the world. In line
No. Programs with the above, Islami Bank Bangladesh Ltd. has started
1 IBTRA 144 6,071 to incorporate the components of standard disclosures
2 BIBM 126 368 in annual report in the broad areas of Profile Disclosure,
3 BBTA 50 176 Management Approach, Performance Indicators and Labor
4 Overseas / Foreign Training 17 37 Practices as stipulated in the Content Index of Financial
5 Wing/Division other than IBTRA 22 1,733 Service Sector Supplement. Although IBBL is yet to initiate
6 Other Institute 76 436 the formal disclosure, it complies with most of the disclosure
Total 435 8,821 requirements as stated in the Index.
Employee Productivity Communication to Shareholders & Stakeholders

(In million Taka) Policy on Communication with Shareholders and
Sl. No. Particulars 2014 2013 Stakeholders
1 Deposit per employee 64.69 57.72
IBBL follows specific policy to facilitate effective
2 Investment per employee 63.69 56.72 communication with the shareholders and stakeholders.
3 Income per employee 6.91 6.70 Share Department of the Bank maintains communication
4 Expenses per employee 4.99 5.45 with the Shareholders, Bondholders and other related
5 Profit before provision per employee 1.92 1.52 stakeholders. Shareholders and others may contact at any
time to this Department for any sort of information and
6 Profit before taxes per employee 1.16 1.22
query. IBBL provides updated information in its website for
7 Salary and allowances per employee 0.76 0.86 all the stakeholders of the Bank.
8 Salary and allowances as percentage 49% 57%
of operating profit before provision Policy on Ensuring Participation of Shareholders at AGM
The figures are for mainstream only
In order to make the AGM more participatory, IBBL declares
Corporate Structure the date of AGM well ahead of time, circulate Annual Reports
Corporate Structure of IBBL is shown at page no. 23. and other documents in time, arrange AGM in a well-known
place & convenient time. Shareholders are allowed to speak
Global Reporting Initiative (GRI) in the AGM freely to give their valuable suggestions.
The Global Reporting Initiative (GRI) is a non-profit
organization that promotes economic, environmental

Environmental and Social Obligations 40 Foreign Companies have purchased more than 11%
shares of total Paid-up Capital of the Bank through Standard
Policies and Practices on Social and Environmental
Chartered Bank. Among them, JP Morgan Chase Bank of
Responsibility
Luxembourg has already purchased 4.18% shares of total
The issue of climatic change is being addressed seriously Paid-up Capital of the Bank solely.
all over the world. It is identified that Bangladesh being a
southern delta is under serious threat of natural disaster. Management Review & Responsibility
A detailed discussion regarding environment and social
obligation of IBBL is included in the Corporate Social Managing Director acts as the Chief Executive Officer
Responsibilities Report. (CEO) of the Bank. Bank has approved Organizational
Structure (Organogram) with clear functional separation
Specific Policies undertaken by the Bank and segregation of processing/functioning (Front and Back
IBBL, being a responsible corporation, has taken some office) authorities. This ensures core risk management
initiatives in this regard, which has been presented in Green practice and compliance across the Bank. Bank’s functions
Banking & CSR sections of this Report. and plans also consider various regulatory limits and
restrictions to be risk compliant.
Contribution to Environment and Society
Management Committee is the main body of Management
A natural and clean environment, economical use of
and decision making in the Bank. Besides, there are
resources and respect for people’s health and safety etc. are
ALCO and Risk Management Coordination Committee for
getting increasingly important. In accordance with this, IBBL
is continuously working towards reducing consumption designated functions and responsibilities. Above all, the
of energy, elimination of use of hazardous substances rules, regulations, guidelines, directions and policies as
from its processes and minimizing waste generation. The applicable for the Banking business and operations govern
emphasis is on minimizing paper transactions to the extent the Bank.
possible. One of the key targets for financing manufacturing
companies is to reduce their carbon footprint. Management Committee
The focus is on developing environmental portfolio. IBBL is Management Committee, the apex management body of
financing as demonstrated its responsibility as a socially the Bank, is comprised of 15 (fifteen) top-level executives
responsible corporate. IBBL is committed to doing better for having long experiences and sound knowledge in Islamic
its clients, investors, employees and communities through a banking. The Committee is headed by the Managing Director
focused approach to corporate responsibility. of the Bank. The Committee exerts financial, administrative
and business discretionary powers delegated by the Board
Investors Friendly Information
and is responsible for implementation of the policies
IBBL’s share is a very reliable choice to the investors due and guidelines approved by the Board. The Management
to its strong fundamentals in the area of capital adequacy, Committee scrutinizes the issues thoroughly before placing
profitability, liquidity and market leadership driven by those to the Executive Committee, Audit Committee, Risk
an experienced top Management and dedicated human Management Committee and the Board. The Management
resource base. Besides, the return on IBBL’s share is Committee critically evaluates the performance of the Bank
excellent. IBBL ranked 40th position among the top 1000 and adopts strategic action plan to achieve various targets
banks around the globe in terms of profit on capital.
set by the Board of Directors.
The Bank has also reputation for Shari’ah based banking
management. There is very little fluctuation in the Islami Delegation of Power
Banks share price and no rumor is observed in the Islami
Bank’s share. Therefore, Investors rely greatly on this share. Management Committee of the Bank has been empowered
Goldman Sachs, the leading wealth management institution of with appropriate administrative, financial and business
the world, has chosen share of IBBL in their portfolio GSN-11 decision-making authorities whereas the Board of Directors
as the best share in Bangladesh. Therefore, the company has and its committees are entrusted with formulation of
invested a good amount of their investible fund in IBBL share. standard policies and procedures. Besides, various Manuals,
policies and guidelines are approved by the Board from time
In addition, the leading wealth management institutions of to time with defined delegation of authority.
the world have chosen the share of IBBL in their portfolio.

Asset-Liability Committee (ALCO) Committee attended 8 (eight) Seminars organized by the

management of the Bank on the eve of inauguration of new
The Asset-Liability Committee (ALCO) of the Bank is branches and 18 (eighteen) Shari’ah Awareness programs
comprised of 10 (ten) top level executives headed by the arranged by the Head Office and different zones.
Managing Director. The Committee meets at least once in a
month to review the liquidity position of the bank, maturity- Shari’ah Inspection
wise grouping of assets and liabilities, Deposits and
As part of major responsibilities of the Committee, it also
Investment pricing and liquidity contingency plan in order
conducted Shari’ah inspections in 286 branches through
to manage the Balance Sheet Risk in a more prudent way.
The ALCO is entrusted with the responsibility of ensuring the Muraqibs during 2014 to ensure that the Shari’ah principles
Bank’s adequate liquidity at all times to meet its obligations are implemented and complied with, or, on the contrary, to
when becomes due without compromising the earning detect if there is any deviation or lapse that has taken place
potential of the Bank. In every ALCO meeting, the committee in the branches of the Bank.
reviews actions taken in previous ALCO meeting, economic
and market status and outlook, liquidity risk related to Regulatory Compliance
Balance Sheet, profit rate structure etc. In addition, special Bank has meticulously been following related guidelines
ALCO meetings are arranged as and when any contingent including submission of Quarterly, Half-yearly and Yearly
situation arises. financial statements and other statutory reports. Any
significant development in the business is forth-with
Supervisory Review Process (SRP) Team disclosed in the form of price sensitive declarations
adhering proper rules/guidelines/directives. Bank also
As per the revised process document of Bangladesh Bank ensures submission of returns to regulatory bodies in full-
for SRP-SREP Dialogue on ICAAP under 2nd Pillar of Basel- compliance of the requirements and appropriate disclosures
II, the Bank has reconstituted the SRP Team with 10 (ten) ensuring transparency and accountability. Board of Directors
members headed by the Managing Director. The Team works ensures adequate disclosures for the shareholders and the
under a specific Terms of Reference (ToR) being approved other stakeholders.
by the Board. The Team is responsible for preparation
of ICAAP document assessing all the risks and capital Compliance Status of Bangladesh Bank Circulars
charge thereagainst before placing the same to the Risk
The Bank has fully complied with Bangladesh Bank
Management Committee and Board for approval and onward
circulars, instructions and guidelines regarding Corporate
submission to Bangladesh Bank. The team also formulates
Governance. The Bank is governed by the Bangladesh
strategies for mitigating the risks.
Bank’s rules and regulation on various issues of banking
Shari’ah Supervisory Committee operation. As per BRPD Circular Letter No.11 dated October
27, 2013 regarding Formation & Responsibilities of Board of
As per Islamic Banking Guidelines issued by Bangladesh Directors of a Bank Company, the Bank has complied with all
Bank, IBBL formed an independent Shari’ah Supervisory the instructions including formation of Board of Directors,
Committee consisting of 12 members comprising Independent director, information regarding directors,
experienced and knowledgeable persons in Islamic responsibilities of the Board of Directors, formation of
Jurisprudence. The Shari’ah Supervisory Committee gives committees from the Board of Directors and training of the
opinions and guidelines to ensure Shari’ah compliance in all
Directors. The Bank is also compliant with the BRPD Circular
activities of the Bank particularly in the modes of investment.
The Committee is governed by a by-law approved by the Letter No.18 dated October 27, 2013 regarding Appointment
Board of Directors. and Responsibilities of the Chief Executive officer.
The representatives of the Committee attend different Directors’ Responsibility in Respect of Audited
meetings of the Bank, like Board of Directors, Executive Financial Statements
Committee, Audit Committee, Risk Management Committee
and Annual Business Development Conferences to give The Board of Directors ensures that financial statements
opinions and oversee the activities of the Bank from Shariàh give a true and fair view of the Bank’s state of affairs, results,
perspective. The Committee also evaluates performance of changes in equity and cash flows of 2014. In preparing the
the officials in terms of their Shariàh compliance. financial statements, the Bank uses appropriate accounting
policies, supported by reasonable as well as prudent
Meeting of Shari’ah Supervisory Committee judgments and estimates to ensure that all applicable
accounting standards have been followed at the time of
In the year 2014, 10 (ten) meetings of Shari’ah Supervisory preparing the financial statements.
Committee were held. Members of Shari’ah Supervisory

Participants of IBBL Directors and Executive in World Congress of Accountants 2014
Relationship of Board of Directors with the Auditors Credit Rating of the Bank
The Board has established transparent and appropriate IBBL is continuously maintaining the highest credit rating
relationships with its external auditors through the Audit among the private sector banks of the country. The description
Committee. The external auditors have an obligation to of latest credit rating of the bank is delineated below:
bring any significant lapses/irregularities in the bank’s
system of internal control and compliance to the attention IBBL obtained the “AA+” rating in consideration of the
of Management, Audit Committee and the Board. following good fundamentals such as:
Relationship of Directors with the Shareholders and • Good capital adequacy

Investors • Sound liquidity
The Board recognizes the importance of timely and proper • Good financial performance
dissemination of information with regard to the Bank’s • Considerable improvement in non-funded business
performance and other issues affecting the interests of the • Strong market position
shareholders, investors and the general public. One of the
most important means of communication to the Shareholders • Good corporate governance
is the Annual Report, which contains comprehensive and • Experienced top management
sufficient details about the financial results, performance • Wide operational network
and other important activities of the Bank.
• Significant rated corporate exposures
Rating Company Particulars Long-term Short-term Rating Base

Credit Rating Information Surveillance Rating AA+ ST-1 Audited Financial Statements upto 31 December
and Services Limited (High Safety)* (Highest Grade)** 2013 and other prevailing factors upto date of
(CRISL) Rating. The Rating is valid up to May 28, 2015 for
long term
* Bank rated in this category is adjudged to be of high quality, offer higher safety and have high credit quality. This level of rating indicates
a corporate entity with a sound credit profile and without significant problems. Risks are modest and may vary slightly from time to time
because of economic conditions
** Highest certainty of timely payment. Short-term liquidity including internal fund generation is very strong and access to alternative sources
of funds is outstanding. Safety is almost risk free like Government short-term obligations
Date of Declaration of Rating: May 29, 2014
Outlook: “Stable” (The bank will be able to maintain its good fundamentals in future. CRISL does not foresee any volatility in the operation
of the bank within the rating validity period)

Directors’ Attendance in the Board, Executive Committee, Audit Committee

and Risk Management Committee Meeting
(During the year 2014)

Name of the Directors Position Board Executive Committee Audit Committee Risk Management
Sl. Committee
No Eligible Attended Eligible Attended Eligible Attended Eligible Attended
to Attend to Attend to Attend to Attend
Janab Abu Nasser Muhammad Chairman 17 14
1
Abduz Zaher
Vice
2 Janab Yousif Abdullah Al-Rajhi 17 2
Chairman
Vice
3 Engr. Mustafa Anwar 17 16 15 15
Chairman
4 Janab Abdullah Abdul Aziz- Al-Rajhi Director 17 -
5 Dr. Areef Suleman Director 17 7 24 5 15 3
Janab Mohammed Abdullah

6 Director 17 7 51 1
Al Jalahma
7 Janab Salahuddin Ahmed Director 17 4 15 2
8 Dr. Abdulhameed Fouad Al-Khateeb Director 17 7 51 0
9 Engr. Md. Eskander Ali Khan Director 17 17 51 51
10 Janab Md. Abul Hossain Director 17 17 51 51
Independent
11 Janab Md. Abdus Salam, FCA, FCS 17 12 22 12
Director
Independent
12 Janab Humayun Bokhteyar, FCA 17 16 51 49
Director
Independent
13 Prof. NRM Borhan Uddin Ph.D. 17 17 24 24
Director
Independent
14 Prof. Dr. A.K.M Sadrul Islam 17 14 15 15
Director
Barrister Mohammed Belayet Independent

15 17 17 24 24 15 14
Hossain Director

Statement of Shares held by Directors & their Spouses and Minor Children
(as on 31.12.2014)
Sl. No Name of the Director Status No. of Shares

1 2 3 4
The Ibn Sina Trust Chairman 36,077,391

Repr. by Prof. Abu Nasser Muhammad Abduz Zaher
1. Prof. Abu Nasser Muhammad Abduz Zaher Self 71,814
Wife of Prof. Abu Nasser 130,967
Mrs. Hamida Khatun Muhammad Abduz Zaher
Abdullah Abdul Aziz Al-Rajhi, KSA Director

2. Vice-Chairman 122,106,875
Yousif Abdullah Al-Rajhi, KSA
&
S/O- Abdullah Abdul Aziz Al-Rajhi
3.
Yousif Abdullah Al-Rajhi, , KSA Self 99,935
The Public Institution for Social Security, Kuwait Vice-Chairman 104,044,941

4. Repr. by Engr. Mustafa Anwar
Engr. Mustafa Anwar Self 3,846,332
Al-Rajhi Co. for Industry & Trade, KSA Director 159,981,628

Repr. by Engr. Md. Eskander Ali Khan
5. Self 1,235,534
Shahanara Begum & Engr. Md. Eskander Ali Khan Joint Account 33,880
Kuwait Awaqaf Public Foundation, Kuwait Director 69,348,836

6.
Repr. by Mohammad Abdullah Al Jalahma
Islamic Development Bank, KSA Director 120,788,585
7.
Repr. by Dr. Areef Suleman
8. Investment Corporation of Bangladesh Director 43,666,880
Repr. by Md. Abul Hossain
Arabsas Travel & Tourist Agency, KSA Director 160,996,668
Repr. by Dr. Abdulhameed Fouad Al-Khateeb
Dr. Abdulhameed Fouad Al-Khateeb Self 9,194,231
9. Wife of Dr. Abdulhameed 3,463
Linah Mahmoud H. Naseef Fouad Al-Khateeb
Wife of Dr. Abdulhameed 2,819
Mrs. Mona Barakeh Fouad Al-Khateeb
Kuwait Finance House, Kuwait Director 84,563,782

10.
Repr. by Salahuddin Ahmed
11. Md. Abdus Salam, FCA, FCS Independent Director 0
12. Humayun Bokhteyar, FCA Independent Director 0
13. Professor NRM Borhan Uddin, Ph.D. Independent Director 0
14. Prof. Dr. A.K.M. Sadrul Islam Independent Director 0
15. Barrister Mohammed Belayet Hossain Independent Director 0
Mohammad Abdul Mannan Managing Director & CEO 411,327

16.
Mrs. Maksuda Begum Wife of Mohammad Abdul Mannan 81,951

Statement of Shares held by CEO, Company Secretary, CFO, Head of Internal

Audit and their Spouses and Minor Children
(as on 31.12.2014)
Sl. No. of
Name Status
No. Shares
Mohammad Abdul Mannan Managing Director &

411,327
01. Chief Executive Officer (CEO)
Mrs. Maksuda Begum W/O. Mohammad Abdul Mannan,

81,951
Abu Reza Md. Yeahia Executive Vice President & Company Secretary 603
02. Mrs. Shahinoor Akther W/O. Abu Reza Md. Yeahia,
0
Executive Vice President & Company Secretary
Md. Habibur Rahman Bhuiyan, FCA Deputy Managing Director & Head of Internal Control
70
& Compliance Wing (ICCW)
03.
Mrs. Tahmina Rahman W/O. Md. Habibur Rahman Bhuiyan,
58
Deputy Managing Director & Head of ICCW
Mohammed Shahid Ullah, ACA, CIB, CDCS Senior Vice President &
8,043
04. Chief Financial Officer (CFO)
Mrs. Farida Yesmin Chowdhury W/O. Mohammed Shahid Ullah, SVP & CFO 160
Statement of Shares held by top 5 (five) Salaried Employees other than the
Directors, CEO, Company Secretary, CFO, Head of Internal Audit (ICCW)
(as on 31.12.2014)
Sl. No. Name Designation No. of Shares
01 Md. Mahbub-ul-Alam Deputy Managing Director, IBW 2,363
02 Rafi Ahmed Begh Deputy Managing Director, RIW 12,958
03 Abdus Sadeque Bhuiyan Executive Vice President, BCD 9,450
04 Md. Obaidul Haque Executive Vice President, DSZ 5,000
05 Dr. Mahmood Ahmed Executive Vice President, IBTRA 128

21 March, 2015
Board of Directors
Islami Bank Tower
40, Dilkusha C/A
Dhaka-1000
Subject : CEO and CFO’s Declaration to the Board
In accordance with the notification of Bangladesh Securities and Exchange Commission No. SEC/
CMRRCD/2006-158/134/Admin/44 dated 07 August 2012, we declare that for the financial year
ended 31 December, 2014:
i) We have reviewed the financial statements for the year and that to the best of our Knowledge
and belief;
a) These statements do not contain any materially untrue statement or omit any material
fact or contain statements that might be misleading;
b) These statements together present a true and fair view of the company’s affairs and are
in compliance with existing accounting standards and applicable laws;
ii) There are, to the best of our knowledge and belief, no transactions entered into by the Bank
during the year which are fraudulent, illegal or violating the Bank’s code of conduct.
Mohammad Abdul Mannan Mohammed Shahid Ullah, ACA, CIB, CDCS

Managing Director & CEO Chief Financial Officer

A member firm of
mgi KHAN WAHAB SHAFIQUE RAHMAN & CO.
BUSINESS SOLUTIONS CHARTERED ACCOUNTANTS Rupali Bima Bhaban (5th Floor),
WORDL WIDE
Partners: 7, Rajuk Avenue,
S.M. Shafique FCA Motijheel, Dhaka-1000
Mujibur Rahman FCA Tel : 9565136, 9551663,
Md. Abu Sina FCA Fax : 880-02-9551821
E-mail : kwsr@dhaka.net
Md. Anisur Rahman FCA Web : www.kwsrbd.com
Certificate on Compliance of Conditions of Corporate Governance

To the Shareholders of Islami Bank Bangladesh Limited
We, in respect of Islami Bank Bangladesh Limited (the Bank), have examined the status of its compliance for the year ended 31st
December, 2014 with conditions of Corporate Governance issued by Bangladesh Securities and Exchange Commission (BSEC)
vide its notification no. SEC/CMRRCD/2006-158/134/Admin/44 dated 7 August 2012.
The compliance with the said conditions of Corporate Governance and reporting the status thereof is the responsibility of the
management of the Bank. Our responsibility is to provide a certificate about whether the Bank is in compliance with the said
conditions of Corporate Governance based on our examination.
Our examination has been made for the purpose of issuing this certificate was limited to the procedures including implementation
thereof as adopted by the Bank for ensuring the compliance of the conditions of Corporate Governance and correct reporting of
the status of the compliance on the attached statement on the basis of evidence gathered and representation received. It is neither
an audit nor an expression of opinion on the financial statements of the Bank.
To the best of our information and according to the explanations given to us, we certify that Islami Bank Bangladesh Limited has
complied with the conditions of Corporate Governance as enclosed stipulated in the abovementioned BSEC’s notification dated 7
August 2012.
Dhaka, Dated Md. Anisur Rahman FCA

March 29, 2015 Partner
ICAB Enrollment No. 350
Khan Wahab Shafique Rahman & Co.

Report on Compliance of BSEC’s Notifiction for Corporate Governance

(Notification No. SEC/CMRRCD/2006-158/134/Admin/44 dated 07 August 2012)
Compliance status
Condition
Title Complied Not Remarks
No.
Complied
1 2 3 4 5
1 Board of Directors
1.1 Board’s size: Board members shall not be less than 5 (five) and more than 20 (twenty) √
1.2 Independent Director
1.2(i) At least one-fifth (1/5) of the total number of directors in the company’s board shall be √
independent directors.
1.2(ii) For the purpose of this clause “independent director” means a director:
1.2(ii)a) Independent Directors do not hold any share or holds less than one percent (1%) shares √
of the total paid-up capital.
1.2(ii)b) Independent Directors are not connected with the company’s Sponsor or Director or √
shareholder who holds one percent (1%) or more shares.
1.2(ii)c) Independent Directors do not have any other relationship, whether pecuniary or otherwise, √
with the company or its subsidiary/associated companies;
1.2(ii)d) Independent Directors are not a member, director or officer of any stock exchange; √
1.2(ii)e) Independent Directors are not a Shareholder, Directors or Officers of any member of stock √
exchange or an intermediary of the capital market;
1.2(ii)f) Independent Directors are not the partners or executives during the preceding 3 (three) √
years of the concerned company’s statutory audit firm;
1.2(ii)g They are not the Independent Directors in more than 3 (three) listed companies; √
1.2(ii)h They are not been convicted by a court of competent jurisdiction as a defaulter in payment √
of any loan to a bank or a Non-Bank Financial Institution (NBFI);
1.2(ii)i) They have not been convicted for a criminal offence involving moral turpitude. √
1.2(iii) The independent director(s) shall be appointed by the board of directors and approved by √
the shareholders in the Annual General Meeting (AGM).
1.2(iv) The post of independent director(s) cannot remain vacant for more than 90 (ninety) days. √
1.2(v) The Board shall lay down a code of conduct of all Board members and annual compliance √
of the code to be recorded.
1.2(vi) The tenure of office of an independent director shall be for a period of 3 (three) years, √
which may be extended for 1 (one) term only.
1.3 Qualification of Independent Director (ID)
1.3(i) Independent Director shall be knowledgeable individual with integrity √
1.3(ii) The Independent Director must have at least 12 (twelve) years of corporate management/ √
professional experiences.
1.3(iii) In special cases, the above qualifications may be relaxed subject to prior approval of the
N/A
Commission.
1.4 Separate Chairman and CEO and their clearly defined roles and responsibilities. √
1.5 Directors’ Report to Shareholders
1.5(i) Industry outlook and possible future developments in the industry. √
1.5(ii) Segment-wise or product-wise performance. √
1.5(iii) Risks and concerns √

Compliance status
Condition
No.
Complied
1 2 3 4 5
1.5(iv) A discussion on Cost of Goods sold, Gross Profit Margin and Net Profit Margin. √
1.5(v) The Bank
does not have
Discussion on continuity of any Extra-Ordinary gain or loss.
such gains or
loss
1.5(vi) Basis for related party transactions- a statement of all related party transactions should √
be disclosed in the annual report.
1.5(vii) Utilization of proceeds from public issues, rights issues and/or through any others
N/A
instruments.
1.5(viii) An explanation if the financial results deteriorate after the company goes for Initial Public
N/A
Offering (IPO), Repeat Public Offering (RPO), Rights Offer, Direct Listing, etc.
1.5(ix) If significant variance occurs between Quarterly Financial performance and Annual
Financial Statements the management shall explain about the variance on their Annual N/A
Report.
1.5(x) Remuneration to directors including independent directors. √
1.5(xi) The financial statements prepared by the management of the issuer company present √
fairly its state of affairs, the result of its operations, cash flows and changes in equity.
1.5(xii) Proper books of account of the issuer company have been maintained. √
1.5(xiii) Appropriate accounting policies have been consistently applied in preparation of the √
financial statements and that the accounting estimates are based on reasonable and
prudent judgment.
1.5(xiv) International Accounting Standards (IAS)/Bangladesh Accounting Standards (BAS)/ √
International Financial Reporting Standards (IFRS)/Bangladesh Financial Reporting
Standards (BFRS), as applicable in Bangladesh, have been followed in preparation of the
financial statements and any departure there-from has been adequately disclosed.
1.5(xv) The system of internal control is sound in design and has been effectively implemented √
and monitored.
1.5(xvi) There are no significant doubts upon the issuer company’s ability to continue as a going √
concern. If the issuer company is not considered to be a going concern, the fact along
with reasons thereof should be disclosed.
1.5(xvii) Significant deviations from the last year’s operating results of the issuer company shall be
N/A
highlighted and the reasons thereof should be explained.
1.5(xviii) Key operating and financial data of at least preceding 5 (five) years shall be summarized. √
1.5(xix) If the issuer company has not declared dividend (cash or stock) for the year, the reasons
N/A
thereof shall be given.
1.5(xx) The number of Board meetings held during the year and attendance by each director shall √
be disclosed.
1.5(xxi) The pattern of shareholding shall be reported to disclose the aggregate number of
shares (along with name wise details where stated below) held by:
1.5(xxi)a) Parent/Subsidiary/Associated Companies and other related parties (name wise details); √
1.5(xxi)b) Directors, Chief Executive Officer, Company Secretary, Chief Financial Officer, Head of √
Internal Audit and their spouses and minor children (name wise details);
1.5(xxi)c) Executives (top five salaried employees of the company other than stated in 1.5 (xxi)b); √
1.5(xxi)d) Shareholders holding ten percent (10%) or more votes interest in the company (name
N/A
wise details).

Compliance status
Condition
No.
Complied
1 2 3 4 5
1.5(xxii) In case of the appointment/re-appointment of a director the company shall disclose
the following information to the shareholders:
1.5(xxii)a) a brief resume of the director; √
1.5(xxii)b) nature of his/her expertise in specific functional areas; √
1.5(xxii)c) names of companies in which the person also holds the directorship and the membership √
of committees of the board.
2. Chief Financial Officer (CFO), Head of Internal Audit & Company Secretary
2.1 Appointment of CFO, Head of Internal Audit and Company Secretary and their clearly √
defined roles, responsibilities and duties.
2.2 Attendance of CFO and the Company Secretary at Board of Directors meeting. √
3. Audit Committee
3. (i) The company shall have an Audit Committee as a sub-committee of the Board of Directors. √
3. (ii) The Audit Committee shall assist the Board of Directors in ensuring that the financial √
statements reflect true and fair view of the state of affairs of the company and in ensuring
a good monitoring system within the business.
3. (iii) The Audit Committee shall be responsible to the Board of Directors. The duties of the √
Audit Committee shall be clearly set forth in writing.
3.1 Constitution of the Audit Committee
3.1(i) The Audit Committee shall be composed of at least 3 (three) members. √
3.1(ii) Constitution of Audit Committee with Board Members including one independent director. √
All members of the audit committee should be “financially literate” and at least 1(one) √
3.1(iii) member shall have accounting or related financial management experience.
3.1(iv) Filling of Casual Vacancy in Committee N/A
3.1(v) The Company Secretary shall act as the secretary of the Committee. √
3.1(vi) The quorum of the Audit Committee meeting shall not constitute without at least 1 (one) √
independent director.
3.2 Chairman of the Audit Committee
3.2(i) Chairman of the Audit Committee shall be an independent director. √
3.2(ii) Chairman of the Audit Committee shall remain present in the Annual General Meeting √
(AGM).
3.3 Role of Audit Committee
3.3(i) Oversee the financial reporting process. √
3.3(ii) Monitor choice of accounting policies and principles. √
3.3(iii) Monitor Internal Control Risk management process. √
3.3(iv) Oversee hiring and performance of external auditors. √
3.3(v) Review along with the management, the annual financial statements before submission √
to the board for approval.
3.3(vi) Review along with the management, the quarterly and half yearly financial statements √
before submission to the board for approval.
3.3(vii) Review the adequacy of internal audit function. √
3.3(viii) Review statement of significant related party transactions submitted by the management. √

Compliance status
Condition
No.
Complied
1 2 3 4 5
3.3(ix) Review Management Letters/ Letter of Internal Control weakness issued by statutory √
auditors.
3.3(x) When money is raised through Initial Public Offering (IPO)/Repeat Public Offering
(RPO)/Rights Issue the company shall disclose to the Audit Committee about the uses/
applications of funds by major category (capital expenditure, sales and marketing N/A
expenses, working capital, etc), on a quarterly basis, as a part of their quarterly declaration
of financial results.
3.4 Reporting of the Audit Committee
3.4.1 Reporting to the Board of Directos
3.4.1(i) The Audit Committee shall report on its activities to the Board of Directors. √
3.4.1 (ii) The Audit Committee shall immediately report of to the Board of Directors on the following
findings, if any:
3.4.1(ii)a) report on conflicts of interests;
3.4.1(ii)b) suspected or presumed fraud or irregularity or material defect in the internal control
system; No such
events
3.4.1(ii)c) suspected infringement of laws, including securities related laws, rules and regulations; happened,
3.4.1(ii)d) any other matter which shall be disclosed to the Board of Directors immediately. thus not
reported
3.4.2 Reporting of anything having material financial impact to the Commission.
3.5 Reporting to the Shareholders and General Investors
4. External/Statutory Auditors
4.(i) Appraisal or valuation services or fairness opinions. √
4.(ii) Financial information systems design and implementation. √
4.(iii) Book-keeping or other services related to the accounting records or financial statements. √
4.(iv) Broker-dealer services. √
4.(v) Actuarial services. √
4.(vi) Internal audit services. √
4.(vii) Any other service that the Audit Committee determines. √
4.(viii) No partner or employees of the external audit firms shall possess any share of the √
company they audit at least during the tenure of their audit assignment of that company.
4.(ix) Audit / certification services on compliance of corporate governance as required under √
clause (i) of condition No.7
5. Subsidiary Company
5.(i) Provisions relating to the composition of the Board of Directors of the holding company √
shall be made applicable to the composition of the Board of Directors of the subsidiary
company.
5.(ii) At least 1 (one) independent director on the Board of Directors of the holding company √
shall be a director on the Board of Directors of the subsidiary company.
5.(iii) The minutes of the Board meeting of the subsidiary company shall be placed for review at √
the following Board meeting of the holding company.
5.(iv) The minutes of the respective Board meeting of the holding company shall state that they √
have reviewed the affairs of the subsidiary company as well.

Compliance status
Condition
No.
Complied
1 2 3 4 5
5.(v) The Audit Committee of the holding company shall also review the financial statements, √
in particular the investments made by the subsidiary company.
6. Duties of Chief Executive Officer (CEO) and Chief Financial Officer (CFO)
6.(i) They have reviewed financial statements for the year and that to the best of their √
knowledge and belief :-
6.(i)a) These statements do not contain any materially untrue statement or omit any material √
fact or contain statements that might be misleading;
6.(i)b) These statements together present a true and fair view of the company’s affairs and are √
in compliance with existing accounting standards and applicable laws.
6.(ii) There are, to the best of knowledge and belief, no transactions entered into by the √
company during the year which are fraudulent, illegal or violation of the company’s code
of conduct.
7. Reporting and Compliance of Corporate Governance
7 (i) The company shall obtain a certificate from a practicing Professional Accountant/ √
Secretary (Chartered Accountant/Cost and Management Accountant/Chartered
Secretary) regarding compliance of conditions of Corporate Governance Guidelines of the
Commission and shall send the same to the shareholders along with the Annual Report
on a yearly basis.
Explanation: Chartered Accountant means Chartered Accountant as defined in the

Bangladesh Chartered Accountants Order, 1973 (President‘s Order No.2 of 1973); Cost &
Management Accountant means Cost & Management Accountant as defined in the Cost
& Management Accountants Ordinance, 1977 (Ordinance No. LIII of 1977); Chartered
Secretary means Chartered Secretary as defined in the Chartered Secretaries Act, 2010
(Act No.25 of 2010)
7 (ii) The directors of the company shall state, in accordance with the Annexure attached, in √
the directors’ report whether the company has complied with these conditions.

Directors’ Report
31st Annual General Meeting
The Board of Directors takes the opportunity to welcome rules to ensure the sustainability of global banks in the event
you all in the 32nd Annual General Meeting of the Bank and that such circumstances repeat in the future. In the US,
have the pleasure to place the Annual Report 2014 before regulators are changing the levels of capital (mainly equity
you along with the Auditors’ Report and Audited Financial and retained profits) they demand from banks and imposed
Statements of the Bank for the year ended December 31,
huge penalties on banks for past non-compliance.
2014. This part of the annual report contains a brief overview
of the world economy, Bangladesh economy and banking Having remained immune during global financial crisis due
industry scenario etc. to its asset backed portfolio, Islamic finance asset stood
around $2 trillion in 2014. Nearly 80% of that is entrusted
Global Economy & Banking
either to Islamic banks or to the Islamic units of conventional
Five years after the global financial crisis, the world economy banks. The rest takes the form of sukuk (15%); Islamic
is showing signs of bouncing back this year, pulled along by investment funds (4%) and Takaful (1%). The demand for
a recovery in high-income economies. The world expected Islamic Finance around the globe is in increasing trend that
a GDP growth around 3.2% in 2014. The US economy encouraged many non-Muslim countries facilitating Shari’ah
performed well and strengthened further this year. A compliant products and services
promising recovery continues in the UK, but growth remains
very low in the Euro Area and Japan. The European Central Bangladesh Economy & Banking
Bank announced a package of stimulus measures. Emerging
The economy indicates that it could not pick up the steam
economies, led by China, are slowing down. Many emerging
in 2014 due to a number of challenges. Maintaining
market and developing economies are still adjusting to
macroeconomic stability, increasing efficiency in
tighter financial conditions and implied higher cost of capital implementation of infrastructure project and improving
and weaker medium-term growth line. governance were some of the challenges. The growth in
Gross Domestic Product (GDP) in 2014 fell short of the
In the wake of the global economic downturn, financial
revised target of 7.2 due mainly to economic factors that
regulators around the world have been working on tighter included sluggish private investment, infrastructural

Directors’ Report
underdevelopment, unsatisfactory collection of revenue has made some significant regulatory changes to promote
and slow implementation of development projects. The further expansion and development of the Islamic Banking
investment-GDP ratio in 2014 was around 22 percent. industry in the country.
National savings were 30.54 percent when total investment
stood at 28.69 percent of GDP during fiscal 2013-14. Point Islami Interbank Fund Market (IIFM)
to point inflation came down to 6.11% in December 2014 In order to address the liquidity problems of Shari’ah
form 7.35% in December 2013. Export earnings increased based banks and financial institutions and for their better
by 12.0 percent in FY14. Import payments increased by 19.3 management, Bangladesh Bank introduced Islami Interbank
percent in FY14. The inflow of workers’ remittances fell by Fund Market in 2012. Under this arrangement, an interested
1.6 percent in FY14. Lower oil price in the global market has Islamic financial institution can place their surplus fund
given some comfort to the external payment for Bangladesh. overnight at Bangladesh Bank. Islamic banks and banks
The exchange rate depreciated only slightly as the central having Islamic banking branches and windows may
bank began to sell dollar for the first time in three years. borrow from this fund overnight. IIFM is expected to play a
Overall, the monetary policy succeeded in maintaining price critical role in the development of Islamic Money Market in
stability and promoting growth. Though capital market has Bangladesh.
been relatively stable during FY2014, it has not recovered
from the wounds that it suffered in 2010. Bangladesh Government Islamic Investment Bond
The country’s banking sector has been caught in a trap (BGIIB)
characterized by high profit spread, excess liquidity and Bangladesh Govt. Islamic Investment Bond (BGIIB),
declining growth in credit disbursement coupled with poor introduced by the Ministry of Finance, Government of
risk management, lax oversight and captured governance. Bangladesh, has been playing an important role in developing
Actual growth of domestic credit up to September 2014 Islamic Money Market. The unit price of the Bond is taka 1
was 12.3 percent while the target for December 2014 was (one) lac. The Bond is treated as a component of Statutory
13.8 percent. Both credit to the public and private sectors Liquidity Ratio (SLR). IBBL is actively involved in buying and
has been sluggish in 2014. In December 2014 interest /profit redeeming of the bond.
rate spread of the banking industry stood at 5.11 percent.
Lower growth in credit coupled with increasing trend of Development in BGIIB Features
non-performing loans/Investment (NPL) has worsened
the performance of the banking sector. During January- Ministry of Finance has recently revised the guidelines of
September 2014 both classified loans/Investment and NPL Bangladesh Govt. Islamic Investment Bonds (BGIIB) to make
have increased. Banking sector experienced huge surplus the investment in BGIIB more attractive through ensuring
liquidity round the year due to higher deposit growth and utilization of fund. Currently three-months bond worth at
lower Investment/credit growth which forced banks to least Tk.100,000 is available in the market alongside the
reduce the profit rates both in deposit and credit portfolio. existing 6-months bond. The bonds are sold at auction. The
Poor asset quality also remains as worries in the sector. profit rate of the bond has been tagged with 3/6 months TDR
Some scam hit state owned banks and they suffered large rate depending on the maturity. However, the profitability
scale capital shortfall which was mitigated through injecting depends on the utilization of fund. Under the revised
fund by the government at the year end. guideline, Govt. may issue bonds under profit sharing
ratio for investment in restricted assets backed Shari’ah
Islamic Banking compliant projects/assets.
Islamic banking industry in Bangladesh comprising 8 full- Islamic Refinance Fund Account
fledged Islamic banks, 19 Islamic banking branches of 8
conventional commercial banks and 25 Islamic banking Bangladesh Bank introduced “Islamic Refinance Fund
windows of 7 conventional commercial banks have been Account” for refinancing Agro-based product processing
performing well. Last year they also contributed to the Industries in rural areas and Small Enterprise (including
deposit mobilization and investments in trade, industry and Women Entrepreneurs) in Bangladesh under the custodian
other sectors including agriculture. Most of the Islamic banks of Bangladesh Bank. Under the refinancing scheme, the
have performed better than conventional counterparts in Shari’ah lenders can make a three-month renewable
2014. Market share of the Islamic Banks in deposit increased investment in the fund. The lending rate will be the Mudaraba
from 18% as of December 2013 to 20.57% in June 2014. savings account rate of the lenders or 5 percent, whichever
Market share in Investment also increased from 21% as of is lower. The profits from the fund will be distributed among
December 2013 to 24.23% as of June 2014. Central Bank participating lenders based on their investment ratio. The

Directors’ Report
Shareholders in 31st AGM
central bank will not take any profit even if it manages the harmonization of Islamic banking policies and practices. It
fund. Shari’ah-based lenders will have to repay the central also promotes knowledge on Islamic Banking by organizing
bank the principal amount of the investment and the profits seminars and conducting training and research on Islamic
on it every three months. The lenders, however, will be able Shari‘ah issues. Seven full-fledged Islamic Banks and thirteen
to borrow until their investment period lasts. Conventional Banks having Islamic Banking Branches are
the members of CSBIBB. In 2014, the Board has organized
Islamic NBFIs and Islamic Insurance Market in a number of trainings, workshops, and capacity building
Bangladesh programs for Islamic banking practitioners of the country.
In addition to Islamic Banks, there are some Non-Bank Shari’ah Indices
Financial Institutions (NBFIs) as well as insurance companies,
which are operating under Islamic Shari’ah. Out of 31 NBFIs, On January 20, 2014, Dhaka Stock Exchange (DSE) launched
2 are operating under Islamic Shari’ah. Out of 77 insurance Shari’ah index, which will represent share price movements
companies, 11 are operating under Islamic Shari’ah. of the listed companies based on Islamic Shari’ah. The broad-
based index, developed for encouraging more Shari’ah-based
Islamic Banks Consultative Forum (IBCF) companies offer shares, is known as DSES. The base-value
of the new index is 1000. S&P Dow Jones Indices served as
IBCF, with Islamic Banks and Conventional Banks having
a consultant to the Dhaka Stock Exchange in designing the
Islamic Banking Branches as members, was established in
methodologies for the DSEX Shari’ah Index.
1995 for effective interaction, cooperation, promotion and
furthering the cause of Islamic banking in Bangladesh. Eight On October 12, 2014, Chittagong Stock Exchange Limited
full-fledged Islamic Banks and six Banks having Islamic (CSE) launched CSE Shari’ah Index (CSI) with base point
Banking Branches are the members of the IBCF. IBBL, of 1,000. The index could be followed by the investors to
being a vibrant member of IBCF, contributes significantly in
track the performance of Shari’ah compliant securities that
the forum. In 2014, the Forum has organized a number of
form part of all listed companies on the CSE other than
seminars and symposia attended by Islamic scholars and
dignitaries from home and abroad which contributed to mutual funds and corporate bonds. The CSI includes 63
building awareness among stakeholders and expansion of Shari’ah compliant stocks from 17 broad sectors. The index
Islamic banking. will also be updated every six months after reviewing the
performance. Unlike shari’ah-based DSES of Dhaka Stock
Central Shari‘ah Board for Islamic Banks of Exchange, the CSI will have access for all. CSI comprises of
Bangladesh (CSBIBB) Shari’ah compliant stocks, representing 48.6% of the total
CSBIBB was established in 2001 to offer Shari’ah opinion market capitalization and around 41.35% of float-adjusted
and assistance to member banks in matters related to market capitalization of the CSE listed companies.

Directors’ Report
Donation to Prime Minister‘s Relief Fund
Profile of IBBL at 40, Dilkusha Commercial Area, Dhaka is the Corporate

Headquarter of the Bank.
Since inception, Islami Bank Bangladesh Limited has been
rendering its banking services by offering diversified and Unique Features
a wide range of deposit, investment & foreign exchange g Welfare-oriented Banking: IBBL started its operation
products coupled with techno based banking devices, which to introduce a welfare-oriented banking ensuring equity
have successfully earned a huge clientele base. As a true and justice in all of its activities. Unlike conventional
reflection of the inner urge of the people of the country and financial institution, profit or wealth maximization has
to conduct all banking & investment activities based on never been among the prime objectives of IBBL. We
Islamic Shari’ah, IBBL unveiled a new horizon and ushered extend our services to individuals of all walks of life with
a new ray of hope towards realizing a long cherished dream strong commitment in advancement and upliftment of
of the people of Bangladesh for conducting their banking economically backward segments.
transactions in accordance with the spirit of Islam. It is the
first Shari’ah based bank in South-East Asia launched on g Focus on ‘Maqasid-al-Shari’ah: As reiterated by Saleh
the 13th March 1983 as a public limited company, started Kamil, Chairman of CIBAFI at 35th IDB conference, so
its functioning informally on 30th March 1983. The formal far most of the Islami banks focus merely on Shari’ah
inauguration was made on 12th August 1983 when the first compliance issues ignoring the Maqasid of Shari’ah.
branch of the Bank i.e. Local Office located at Motijheel, IBBL, being an exception, not only ensures Shari’ah
Dhaka started its full fledged banking operations. As on compliance but also focuses on ‘Makasid-al-Shari’ah’ in
31.12.2014, after passing a long journey of continuous all its operational portfolios.
success and glory in almost all business indices, the Bank
is now running with Tk.16,099.99 million paid up capital g Mass Banking: Most of the Private Commercial Banks
that was Tk.80.00 million at the date of establishment. operate to address the necessities of class people.
The aesthetically viewed 18-storied own building located IBBL makes a difference in this situation by addressing

Directors’ Report
the requirements of mass people. Around 1/5th of our number of rural branches among the first generation
manpower is engaged to serve about 3% of the total private commercial banks. Out of total 294 Branches,
investment under Rural Development Scheme (RDS). 76.19 %, i.e., 224 are Urban Branches and 23.81 %, i.e.
70 are Rural Branches according to the criteria set by
g Need-based Banking: In line with following need Bangladesh Bank for determining urban- rural Branch.
prioritization in financing as per Islamic Shari’ah, IBBL
does not work to fulfill the need of few people rather Number of Branches
focuses on the requirement of the real needs of the
common people. Thus, IBBL strives to substitute the
‘Greed-based Banking’ through establishing ‘Need-
based Banking’.
g Special Investment Scheme: IBBL has some special

investment schemes for particular group of people to
address their special needs. The supervision cost of
these investments is high which makes our income
lesser compared with other market participants.
g Socially and Environmentally Desirable Investments:

IBBL, by virtue of its adherence to Shari’ah and its Subsidiary Companies
commitment to ensure welfare, does not invest in
socially and environmentally undesirable projects Islami Bank Securities Limited (IBSL)
even the projects seems to be financially viable and IBSL - a subsidiary company of Islami Bank Bangladesh
profitable. Limited - was incorporated in March 22, 2010 as a Public
Limited Company under Companies Act, 1994 with the
g Widening Network to Address Unbanked Population: objective to carry out Business of Stock Broker & Dealer in
IBBL is continuously pursuing for widening its network the Capital Market. The Paid-up capital of IBSL is Tk.2,700.00
by maximizing opening of new branches to reach to the million against Authorized capital of Tk.5,000.00 million. The
unbanked and underserved segment of population of company has been operating in the capital market with a view
the country. to maximize shareholders’ value since its commencement of
business. IBSL mainly provides the following services:-
Network
g Operation of Stock Dealer A/C for own Portfolio
As a Bank of the mass people and to deliver its banking g Opening of BO A/C and providing dematerialization and
services to the highest possible number of customers,
re-materialization facilities to the customers
IBBL is enriched with a vast banking network across the
country by setting up its branches all over the country. g Trading Operation with own software named – ‘IBSS
Moreover, Alternative Delivery Channels (ADC) of the Software’
Bank having 450 owned & more than 4000 shared ATM
booths have expanded this network up to the doorstep g Introduction of i-Trading, SMS Trading, etc
of the customers. As a part of gradual expansion of its
coverage to the important commercial places both in
g Ensured hassle free IPO participation of customers
urban & rural areas, in 2014, the Bank has successfully g Introduction of BEFTN (fund transfer) facilities
opened 08 new branches raising the total number of
Branches to 294 from 286 of the previous year. g Diversification of Investment products
Aiming to achieve a balanced development in economic g Stock Brokerage Operation for execution of Customers
movement of the country as well as to uplift the socio trading and providing Musharaka Investment under
economic conditions at rural areas, IBBL has the highest Margin Rule

Directors’ Report
Islami Bank Capital Management Limited (IBCML) g. Islamic Banks Consultative Forum (IBCF)
IBCML was incorporated on the 01 April 2010 under the h. Dhaka Chamber of Commerce & Industry (DCCI)
Companies Act 1994 as a Public Limited Company with
Authorized Capital of Tk. 1000.00 million & Paid Up Capital i. Dhaka Stock Exchange Limited (DSE)
of Tk.300.00 million divided by 3,00,000 (Three lac) shares
j. Federation of Bangladesh Chambers of Commerce and
of Tk.1000/- each.
Industries (FBCCI)
The main objectives of the company are to carry out the
business of a Merchant Bank in all its aspects including k. Bangladesh Chamber of Industries (BCI)
Underwriting and / or Management of Issue, Public Offer of International Membership
Shares, Stocks, Debentures, Bonds etc., sale or purchase of
Securities or transfer thereof; Fund Management for clients, • Accounting and Auditing Organizations for Islamic
Managing Portfolio Investment of any person or Company Financial Institutions (AAOIFI), Manama, Bahrain
by making profitable Investment in various avenue etc. and has become member of its Board of Trustees.
IBBL Exchange Singapore Pte. Ltd. • Islamic Financial Services Board (IFSB), Kuala
Lumpur, Malaysia.
IBBL Exchange Singapore Pte. Ltd. is a subsidiary of IBBL
incorporated with Accounting and Corporate Regulatory
• General Council for Islamic Banks and Financial
Authority (ACRA) in Singapore vide registration no.
Institutions (CIBAFI), Manama, Bahrain
200912627K for money- remittance, changing, transmitting
and doing all matters and things incidental thereto under the • International Islamic Financial Market (IIFM)
companies Act, CAP.50 of the Republic of Singapore. Manama, Bahrain
Offshore Banking Units • International Islamic Centre for Reconciliation and

The operations of Off-shore Banking Units (OBU) of the Bank Arbitration (IICRA)
were commenced on January 4, 2011 as per the approval
• International Chamber of Commerce Bangladesh
of Bangladesh Bank. The Off-Shore Banking Units (OBU) of
(ICC-Bangladesh)
the Bank are located at Head Office Complex Branch-Dhaka,
Uttara Branch-Dhaka and Agrabad Branch-Chittagong.
• American Chamber of Commerce in Bangladesh
(AmCham)
National Membership
IBBL’s Equity Investment
a. Bangladesh Institute of Bank Management (BIBM)
a. Central Depository Bangladesh Limited (CDBL)
b. The Institute of Bankers, Bangladesh (IBB)
c. Bangladesh Association of Banks(BAB) b. Karmasangsthan Bank (Employment Bank)
d. Bangladesh Foreign Exchange Dealers’ Association c. Bangladesh Shipping Corporation (BSC)

(BAFEDA)
d. Bangladesh Aroma Tea Ltd.
e. Bangladesh Association of Public Listed Companies
(BAPLC) e. Financial Institutions and Investors Portfolio
Management Company Ltd.
f. Central Shari’ah Board for Islamic Banks in Bangladesh
(CSBIBB)

Directors’ Report
Inauguration of Panchbibi Branch
Business Review Deposit Products
IBBL successfully mobilized Tk.560,696 million Deposit Any financial institution especially a Bank can hardly
from 9,587,458 Depositors and deployed Tk.463,475 prosper and compete with other banks effectively without
million as general Investment into 839,394 accounts up to multidimensional and diversified products. Keeping this
31st December 2014. In the year 2014, total income of the in view, IBBL has introduced 24 deposit products so far.
Bank was Tk.58,047 million showing 3.48% growth over
Historical trend of the deposit mobilization shows doubling
2013 and total Expenditure was Tk.42,724 million showing
1.69% increase than that of 2013 resulting in pre-tax profit its deposit base in every 4 years.
of Tk.10,531.71 million. The Board of Directors of the Bank
has recommended 15% cash Dividend to the shareholders Mobilization of Deposits
for the year 2014.
In the year 2014, total Deposit stood at TK. 560,696 million
Bank of around Crore Depositors as on 31st December 2014 as against Tk.473,141 million of
Total number of Depositors of IBBL increased to 9,587,458 the preceding year registering a growth of Tk.87,555 million,
in 2014 from 8,538,969 of the preceding year, registering an i.e. 19 % growth.
increase of 1,048,489 accounts in 2014, with 12% growth
over 2013.
Deposit : 2010 to 2014
Account Opening : 2010 to 2014
560,696
(Million Taka)
95,87,458
95,87,458
10,48,489

Directors’ Report
Weightage, Rate, Growth & Mix of Deposit by Product

Sl. Types of Deposits Weightage Final Rate (%) Deposit Growth Deposit Mix (%)
No. (In million Taka)
2014 2013 2014 2013 % 2014 2013
1 2 3 4 5 6 7 8 9 10
A Mudaraba Deposits
1 Mudaraba Savings Account (MSA) 0.62 4.90 6.30 181,663 155,194 17.06% 32.40 32.80
2 Mudaraba Term Deposits (MTDR) 170,175 131,412 29.50% 30.35 27.77
2.1 36 Months 1.10 9.47 11.20
2.2 24 Months 1.07 9.26 11.00
2.3 12 Months 1.05 8.98 10.50
2.4 06 Months 1.03 8.48 10.47
2.5 03 Months 1.00 7.98 10.45
2.6 01 Month 0.82 6.30 9.00
3 Mudaraba Special Savings (Pension) Scheme (MSS) 93,253 82,701 12.76% 16.63 17.48
3.1 10 years Term 1.25 9.64 10.91
3.2 5 years Term 1.10 8.51 9.24
4 Mudaraba Monthly Profit Deposits Scheme(MMPDS) 21,789 18,988 14.75% 3.89 4.01
4.1 5 years Term 1.18 10.08 11.50
4.2 3 years Term 1.10 9.64 11.20
5 Mudaraba Savings Bond (MSB) 16,821 15,826 6.29% 3.00 3.34
5.1 8 years Term 1.25 9.68 11.00
5.2 5 years Term 1.12 8.85 10.00
6 Mudaraba Special Notice Deposits (MSND) 0.50 3.70 5.00 6,072 5,916 2.63% 1.08 1.25
7 Mudaraba Hajj Savings (MHS) 1,851 1,529 21.04% 0.33 0.32
7.1 Above 10 years Term 1.30 10.23 11.33
7.2 Upto 10 years Term 1.25 9.64 10.91
8 Mudaraba NRB Savings Bond 858 726 18.21% 0.15 0.15
8.1 10 years Term 1.30 10.18 11.33
8.2 5 years Term 1.15 8.81 10.49
9 Mudaraba Farmers Savings (MFS) 0.75 5.80 7.56 815 549 48.39% 0.15 0.12
10 Mudaraba Waqf Cash Deposit (MWCD) 1.35 10.63 11.33 533 436 22.25% 0.10 0.09
11 Mudaraba Muhor Savings (MMS) 430 382 12.45% 0.08 0.08
11.1 10 years Term 1.25 9.64 10.91
11.2 5 years Term 1.10 8.51 9.24
12 Students Mudaraba Savings (SMSA) 0.62 4.90 6.30 651 330 97.39% 0.12 0.07
13 Mudaraba Upahar Deposit Shceme (MUDS) 0.62 4.90 6.30 13 11 15.36% 0.00 0.00
14 Mudaraba mCash Deposit Scheme 0.50 3.70 5.00 33 23 43.63% 0.01 0.00
15 Mudaraba Foreign Currency Deposits (MFCDA) 0.75 1.66 1.66 7,727 2,886 167.75% 1.38 0.61
16 Mudaraba Perpetual Bond (MPB) 1.25 11.18 12.80 3,000 3,000
B Cost Free Deposits 10.35 11.89
17 Al Wadeeah Current Account (AWCA) 26,277 22,296 17.85% 4.69 4.71
18 Bills Payable 3,650 4,129 -11.60% 0.65 0.87
19 Cost Free Foreign Currency Deposits 6,844 6584 3.95% 1.22 1.39
20 Other Cost Free Deposits 21,241 23,223 -4.15% 3.79 4.91
Total (A+B) 560,696 473,141 18.51% 100.00 100.00

Directors’ Report
Mudaraba Monthly Profit Deposit Scheme

Any individual may open account under this scheme,
depositing a minimum amount of Taka 1,00,000/- and
3%
multiples thereof at a time, for 3 years or 5 years. Monthly
32% provisional profit is given to the account just after completion
Mudaraba Savings Deposit
Mudaraba Special Savings Deposit
of one month from the date of opening of the account. The
10% Mudaraba Term Deposit profit amount is adjusted on completion of each accounting
Cost free Deposit
Mudaraba Savings Bond
year after declaration of final rate of profit.
Mudaraba Monthly Profit Deposit
Mudaraba Special Notice Deposit
30% 17%
Others Mudaraba Muhor Savings
The Bank introduced this account to facilitate to pay
muhorana for a husband to his wife. Any competent person
even before his marriage or a husband in the name of his
wife may open this account on monthly installment basis for
minimum amount of Taka 500/- to Taka 5,000/- for a period
Welfare Oriented Special Deposit Products either of 5 or 10 years.
Mudaraba Waqf Cash Deposit Students Mudaraba Savings

IBBL plays a leading role in introducing this unique product, Students of any educational institute are eligible to open
the objectives of which is purely for the welfare of the Students Mudaraba Savings Account. Initial deposit of this
society. Mudaraba Waqf Cash Deposit account may be account is Tk.100/- and profit is given on balance of Tk.100/-.
opened at a time with a minimum deposit of Tk.1,000/- and No charge is applicable on this account except excise duty
the subsequent deposit by installments in thousand Taka or and tax as per govt. policy. The account may be continued
in multiple of thousand Taka. Profit of this account is utilized as Mudaraba Savings Account in their own name when the
for social and human welfare as per instruction of the student becomes adult. Attractive prizes are distributed
account holders. During 2014, the Bank has opened 3,012 among the top 10 depositors in every month. The Bank has
new Mudaraba Waqf Cash Deposit Account totaling 25,123 attracted 44,747 new Students Savings Account in 2014.
Accounts up to 2014.
Mudaraba Hajj Savings Mudaraba Farmers Savings
Any Muslim intending to perform Hajj may open Hajj This product is designed to reach the unbanked people
Savings Account. The Account may be opened from the especially farmers. Only a genuine Farmer can open
25 alternatives based on duration ranging from 1 year to this account by initial deposit of Tk.10/- only. Farmers,
25 years for building up savings by monthly installments Association or Co-operative society of farmers, shall be
considering the capacity and ease of the account holder. eligible to open Mudaraba Farmers Savings Account (MFSA).
The Bank has attracted 9,959 new Mudaraba Hajj Savings This MFSA may also be opened by the father/mother/legal
Account during 2014. guardian (farmer) in favor of a minor. The Bank has attracted
29,776 new Farmers Savings Account in 2014.
Mudaraba Special Savings (Pension) Scheme
Mudaraba NRB Savings Bond
In this Mudaraba Special Savings (Pension) Scheme, a
person obtains the opportunity to build up savings by small Only the Non-Resident Bangladeshis aged 18 years and
monthly installments for getting an attractive amount at the above is eligible to open Mudaraba NRB Savings Bond
end of a specified term or a monthly amount for a specific Account in single or joint names. Service charge, account
period on the expiry of 5 years or 10 years term. The Account closing fee and account maintenance fee are not applicable
can be opened for any amount in multiple of hundred taka. for this account. As per client’s demand, maximum 90%
In 2014, the Bank has opened 348,829 Mudaraba Special quard may be allowed against total outstanding balance in
Savings Account. this account.

Directors’ Report
General Investment million as on 31.12.2013 showing an increase of Tk.60,280

million, i.e. 15% growth. The growth is about the country
Total General Investment of the Bank increased to investment growth of 14%. The trend of investment shows
Tk. 463,475 million as on 31.12.2014 from Tk.403,195 near doubling of the figure in 5 years.
Sector-wise Investment
(In million Taka)
2014 2013
Sector % to Total % to Total
Amount Amount
Investment Investment
Industrial (Excluding Industrial
77,558 18% 52,861 14%
Portion of SME)
Commercial 129,544 28% 125,788 31
Real Estate 37,680 8% 27,126 7
Agriculture (including investment
in Fertilizer and Agriculture 11,131 3% 20,385 5
Implements)
Transport 6,435 1% 6,679 2
SME 201,127 42% 170,356 41%
Total 463,475 100% 403,195 100%
Mode-wise Investment
(In million Taka)
2014 2013
Mode % to Total % to Total
Amount Amount
Investment Investment
Bai-Murabaha 281,556 60.75% 224,456 55.17%
HPSM 109,941 23.72% 95,491 23.47%
Bai Muajjal 15,443 3.33% 23,103 5.68%
Bill Purchased & Negotiation 30,424 6.56% 23,261 6.61%
Quard 15,478 3.34% 13,670 3.36%
Bai- Salam 4,808 1.04% 3,889 0.96%
Mudaraba 3,000 0.65% - 0.00%
Musharaka 2,825 0.61% 19,323 4.75%
Total 463,475 100% 403,195 100%
The investment plan has been formulated keeping in view the national economic priorities and diversification of the Investment
portfolios by size, sector, geographical area, economic purpose and securities based on the Five Year Business Plan (2012–2016)
of the Bank.

Directors’ Report
One of the IBBL Financed Power Plants
Investment in Industrial Sector Pharmaceuticals & Health Care

Industrial development of the country falls under the To boost the pharmaceutical industry, the bank invested
priority areas of IBBL. The Bank has considerable amount Tk.2,885 million in this sector among 16 beneficiaries so
of investment in the industrial sector. Total investment for far. Besides 76 hospital, clinic and pathological centers have
projects together with Working Capital stood at Tk 155,432 been established by the Bank finance of Tk. 1,280 million.
million as on 31st December 2014 as against Tk.121,531
Housing
million as on 31st December 2013.The Bank has deployed
33.54% of its total investment in industrial sector out of IBBL has extended investment for housing facility to 10,028
which export oriented textile and garment industries take a clients by disbursing Tk. 24,985 million at individual level and
share of 69.38%. Tk. 4,440 million to 98 developer companies. At the close
of 2014, outstanding investment in housing was Tk.20,780
million which was 4.48% of Total Investment.
Garments
IBBL ventured in financing garment industries in the Agro-Based Industries
early stage of the Industry. The Bank also financed in the For qualitative improvement of agricultural sector and
backward linkage industries. It is mentioning here that, procurement of logistics including raw materials for the
most of the leading export-oriented garment industries of agro-based industry, IBBL extended finance to ventures like
the country initially started their business taking small size Automatic Rice Mills, Flour Mills, Edible Oil Mills, Jute Mills,
investment from IBBL. Gradually they have developed their Fishery, Poultry & Dairy, Salt, Sugar, Food and Beverage, Cold
industries into a large one. Storage, Fertilizer, Oil and Electricity from Rice Bran etc. IBBL
financed 952 agro-based industries outstanding balance of
Textile which stood at Tk.18,455 million.
A good number of spinning mills, weaving mills, dyeing, Electricity & Power
finishing mills of textile sector has been set-up with IBBL
Investment. Most of these mills are set-up with brand new 11 power plants have been financed by IBBL so far to the
state of the art machines. This contributes immensely tune of Tk. 5,037 million. The bank has also financed
toward value addition in RMG. Tk.2,284 million for the production of electric instruments.

Directors’ Report
Steel Manufacturing Industry financed by IBBL
Moreover, 755 clients availed investment of Tk. 2,069 million The Present government has given importance for improving
for purchasing and procuring electronics goods. Apart from SMEs for reduction of poverty and employment generation
power plants and electrical goods, the Bank is also working on and introduced a separate department in Bangladesh Bank
solar power and an investment scheme under the name and named SME & Special Programmes Department. To work in
style “Solar Panel Investment Scheme” has been introduced. a more pragmatic & focused way, Islami Bank Bangladesh
Ltd. has divided SME Investment Division into two divisions
Transport namely SME Investment Division-I & SME Investment
Division-II. Bank has also adopted a comprehensive SME
To develop the transport sector, IBBL has disbursed Investment Policy.
substantial amount of investment in road, water and air
transport to 1,297 clients and the outstanding balance of Islami Bank has disbursed Tk. 24,981 crore to the SMEs in
investment is Tk. 6,435 million which is the highest amongst the year 2014 which is 106% of annual target of Tk.23,500
all nationalized and private commercial banks of Bangladesh, crore. SME investment outstanding as on 31 December,
and the amount is 1.39% of the Bank’s investment. Besides, 2014 is Tk. 20,112 crore which is 42% of Bank’s total general
IBBL financed 75 Filling/CNG stations where present balance investment.
of investment is Tk. 469 million.
Islami Bank is holding highest position in financing SMEs among
Information Technology the Bank/FIs in the country having 15% market share (on the
basis of outstanding position). At present, SME Investment of
IBBL has so far extended finance amounting to Tk. 368 million IBBL created about 8 lac employments in the country.
to 8 clients for producing and procuring hardware & software.
IBBL is also working on developing new entrepreneurs with Mentionable that IBBL has got ‘Small Entrepreneur Friendly
innovative ideas to go for big investments in this sector. Bank of the Year’ in the year, 2014 award jointly awarded by
SME Foundation & Bangladesh Bank over the performance
SME Investment of the year 2011, 2012 & 2013.
SME has become a familiar slogan today around the Nearly half of the population of our country is women, but
world including Bangladesh. SME plays important role in women entrepreneurs of the country is less than 10%. For
socio-economic development of the country, increasing developing women entrepreneurs throughout the country,
employment and creating entrepreneurs. This sector is Islami Bank Bangladesh Limited has taken various steps.
labor intensive and productive with short gestation period. Bank has introduced Women Entrepreneurs Investment

Directors’ Report
Pharmaceutical Industry financed by IBBL
Scheme where they are enjoying low rate of return i.e. only SME Exposure of IBBL Vs PCBs
12% upto the ceiling of Tk. 40 lac investment and are
enjoying collateral free investment facility up to Tk.5 lac also. 20%
Present outstanding under women entrepreneurs investment
is about Tk.751 crore to 14 thousand clients. In 2014, IBBL
has disbursed Tk.1591 crore to the Women Entrepreneurs.
IBBL
Islami Bank has given importance in Cluster Approach
Other PCBs
Method for developing SMEs and has disbursed Tk. 1326 80%
crore in 50 clusters among the 9,841 clients from January
to December, 2014.
SME Exposure of IBBL Vs National
SME Investment : 2010-2014
(Million Taka)
IBBL
National Exposure Other

than IBBL
Besides, the Bank provides various Non-Financial Services Welfare Oriented Investment Schemes
(NFS) to the SMEs. Bank arranges training for developing In addition to the usual investment operations, IBBL has 16
entrepreneurs, render advice for developing technology & Special Investment Schemes for different groups of people.
market expansion and participates in various meetings, The schemes as part of Bank’s welfare mission aim at fulfilling
finance needs of different segments of people particularly
symposium etc. The Bank has participated almost in all SME the under privileged downtrodden and neglected segments
Fairs arranged in the country. Lastly IBBL attended in SME of population of the country. To improve the living standard
Financing Fair, 2014 held on 12-13 November organized by of these people some welfare oriented special investment
SME Foundation with collaboration of Bangladesh Bank. schemes have been undertaken:

Directors’ Report
Spinning Industry
Scheme-wise Investment
(In million Taka)
Sl. No. Name of Scheme 2014 2013 2012 2011 2010
i. Rural Development Scheme (RDS) 17,380 13,731 10,390 7,072 5,110
ii. House-hold Durables Scheme 1,392 1,048 955 1,070 962
iii. Investment Scheme for Doctors 55 37 32 14 15
iv. Transport Investment Scheme 6,832 7,057 6,887 6,707 4,732
v. Car Investment Scheme 69 75 113 152 139
Small Business Investment Scheme
vi. 3,817 3,202 2,774 2,348 1,703
(SBIS)
vii. Micro-Industries Investment Scheme 22 29 36 38 47
Agricultural Implements Investment
viii. 882 337 278 210 127
Scheme
ix. Housing Investment Scheme 209 261 316 367 419
x. Housing Investment Program (HIP) 20,780 15,903 15,660 12,485 10,155
Palli Griha Nirman Beniyog Prakalpa
xi. 2,717 2,059 1,483 903 358
(PGNBP)
Sub-total 54,156 43,739 43,739 31,366 23,767
Total Investment 463,475 403,195 406,817 305,841 263,225
% to total Investment 11.68% 10.85% 10.75% 10.26% 9.03%
Welfare oriented investment schemes over the last five years have increased from 9.03% to 11.68% of General Investment.

Directors’ Report
Household Durable Investment Scheme Micro-Industries Investment Scheme

Low-income people in diverse profession with limited Micro Industries investment Scheme aims at creating a
income are benefited by this scheme. They can purchase wider base for industries and to encourage establishment
household requirement like Refrigerator, TV, Motor-cycle, of micro-industries in different areas of the country by
Furniture, Ornaments, Computer etc. at investments under the potential entrepreneurs and to diversify the Bank’s
this financing scheme. investment portfolio.
Housing Investment Program Rural Housing Investment Scheme

Housing Investment plays a vital role in improving standard To extend housing facility to the rural people living within
of living, empowering the middle-income and lower-income 10 kilometers area of an IBBL branch, a scheme named
groups and thereby promoting equitable growth in the society. “Palli Griha Nirman Beniyog Prakalpa” has been introduced.
The Scheme not only caters to fulfilling one of the basic needs Service holders at public, semi-public or autonomous
i.e. shelter but also have significant impact on the lives of the institutions, non-resident Bangladeshis and businesspersons
dwellers in terms of skill enhancement, income generation, are preferred for this investment.
increased security, health, self-confidence and human dignity.
Women Entrepreneurs Investment Scheme
Transport Investment Scheme Islami Bank has always given priority to develop the women
IBBL has introduced Transport Investment Scheme to entrepreneurs. Under ‘Women Entrepreneurs Investment
improve the existing transportation problem and to ensure Scheme (WEIS)’ IBBL offers lower rate of return i.e. 12%
speedy economic growth and development of the country only and collateral free investment up to 0.50 million with
through expansion of trade, commerce and industry. some other flexible terms & conditions to the women
entrepreneurs. Up to December 2014, IBBL disbursed
Car Investment Scheme Tk.4,790 million favoring the women entrepreneurs.
IBBL has designed the scheme for the mid and high
ranking officials of the government and semi-government NRB Investment Scheme
organizations, corporations, executives and directors of big
IBBL has launched NRB Entrepreneurs Scheme for
business houses and companies and for persons of different
professional groups on easy payment terms and conditions. promoting investment among non-resident Bangladeshi
and for encouraging them to remit money through banking
Investment Scheme for Doctors channel. Expatriates aged between 18 to 60 years or their
family members who maintain accounts with IBBL for
The scheme has been offered for fresh medical graduates remitting money are eligible for the investment.
intending to set up medical centers. IBBL comes forward
with finance to help procure medical equipments and to set Micro-Investment Activities
up diagnostic laboratory, pharmacy, clinic etc.
Small Business Investment Scheme Islami Bank Bangladesh Limited launched its microfinance
program for the rural poor under the name and style of
To give a boost to the small businesspersons and “Rural Development Scheme (RDS)” in the year 1995 to cater
entrepreneurs, the Bank has launched the scheme and it is
to the investment needs of the agriculture and rural sector to
contributing a lot to generate income and employment as
create opportunity for generation of employment and raising
well as to develop the standard of life of different segment
of low-income people. The Bank provides different types of income of the rural people with a view to alleviate poverty.
agricultural instruments, equipments for operating small 221 branches of the Bank have been operating RDS activities
trade and finance, small shop, light transport, machinery for across the country. The Bank launched another microfinance
small and cottage industry etc. under this scheme. program namely “Urban Poor Development Scheme (UPDS)”
in May 2012 for extending micro-investment facilities among
Agricultural Implements Investment Scheme the urban poor. At present, the Scheme is being operated
The Bank has introduced this scheme keeping in view the through 23 urban branches under Dhaka, Chittagong &
people-orientation and welfare objectives of the Bank. Under the Sylhet metropolitan cities. Through both the Schemes, IBBL
scheme, power tillers, power pumps, shallow tube-wells, thresher could bring more than one million poor outreach of rural and
machines etc. are provided on easy terms to the unemployed urban areas under banking services present enrolment of
rural youths for self-employment and to the farmers to help whom is 911,470. Performance under the Schemes as on
them augment production in the agriculture sector. 31.12.2014 are shown in the next page.

Directors’ Report
Home Textile Industry Garments Industry
Performance of Micro-Investment
Performance under both the Schemes at a glance as on 31.12.2014 is shown below:
(In million Taka)
Sl. Particular RDS UPDS Total
01 No. of Branch 221 23 244
02 No. of Employees 2,385 114 2,499
03 No. of Member 891,485 19,985 911,470
04 No. of Client (members availing investment) 571,056 14,863 585,919
05 Total disbursement during the year 23,505.17 678.32 24,183.49
06 Investment Outstanding 16,859.18 520.78 17,379.96
07 Overdue 80.43 8.71 89.14
08 Savings 5,653.42 73.73 5,727.15
Inclusion
The target group people are organised as members in the 27,874 centres in 18,086 villages. It may be mentioned that ratio
selected villages/areas in groups under different centres. At of female members under the Schemes is 80%. Expansion of
present, 911,470 members are getting financial services under RDS & UPDS in the last 4 years is shown in the following table:
(In million Taka)

Growth Growth over Growth
Sl. Particular 2011 2012 2013 2014
over 2011 2012 over 2013
01 MI client 343,304 421,703 23% 472,146 12% 527,934 12%
02 MEI client 39,015 53,063 36% 60,089 13% 57,985 (4%)
03 Total Client 382,319 474,766 24% 532,235 12% 585,919 10%
Savings Program
The members under the Schemes have to deposit compulsory weekly savings with the Bank at least Tk.25/- per week. Total
savings of RDS & UPDS members was Tk. 5,727.15 million as on 31.12.2014. Year-wise accumulation of deposit in the last 4 years
is shown in the following Table:

Directors’ Report
Cable Industry Food Industry
Growth Growth Growth

Sl. Particular 2011 2012 2013 2014
over 2011 over 2012 over 2013
01 MSA-RDS 2,204.89 2,895.05 31% 3,750.86 30% 4,572.49 22%
02 MSS-RDS 133.95 427.47 219% 780.60 83% 1,154.66 48%
03 Total Savings 2,340.45 3,322.52 42% 4,531.46 36% 5,727.15 26%
Investment Program hardcore poor are also extended Quard (cost-free loan) up
to Tk.10,000/- for rehabilitation & sanitation purpose and for
Types of Investment Products mitigating urgent fund crisis against loss from calamities.
There are two types of investment facilities provided to Growth of Investment

the beneficiaries: (a) Micro-investment (collateral-free
Cumulative disbursement among the beneficiaries was
investment facilities up to Tk.75,000/- provided for different
Tk.100,521.08 million up to December-2014 balance of which
income generating activities) and (b) Micro-Enterprise
outstanding stood at Tk.17,379.96 million as on 31.12.2014.
Investment (collateralized investment up to Tk.400,000/-
A comparative position of growth of investment under Micro-
provided to graduate micro-investment clients and micro-
Investment (MI) and Micro-Enterprise investment (MEI) of
entrepreneurs). However, the distressed members &
the schemes is shown in the following table:
In million Taka)
Growth Growth Growth

Sl. Particular 2011 2012 2013 2014
over 2011 over 2012 over 2013
01 Micro Investment (MI) 4,234.18 6,036.74 43% 7,956.89 32% 10,254.76 29%
02 M E Investment (MEI) 2,837.85 4,353.97 53% 5,774.03 33% 7,125.20 23%
03 Total Outstanding 7,072.03 10,390.71 47% 13,730.92 32% 17,379.96 27%
04 Rate of Recovery 99.58% 99.72% - 99.70% - 99.50% -

Directors’ Report
TV Assembling Industry Refrigerator Manufacturing Industry
Sector-wise Investment of RDS investment is Tk.50,000/- or above starting from Tk.10,000/-

only. In addition, there are 27,128 clients who have been
Graduation Program migrated to micro-enterprise investment facility.
In order to ensure gradual and sustainable development Non-financial (welfare) Programs under the Schemes
of the target group, apart from investment, the clients
are provided with skill development training and various Since poverty alleviation needs a combination of financial
support services like medical support, education support, and non-financial programs, different non-financial welfare
relief & rehabilitation support etc. It is found that there are services are extended under the Schemes in the areas of (1)
71,426 graduated clients under the Scheme who have been Education, (2) Training, (3) Health, (4) Relief & Rehabilitation
availing investment for the last five years and their present
and (5) Environment.
Welfare Activities
Non-financial (Welfare) activities during the year 2014 at a glance are shown below:
(In million Taka)
Sl. Program 2014 Cumulative
Beneficiary Amount Beneficiary Amount
01 Education Program 41,498 51.25 85,193 125.74
02 Training Program 157,187 19.50 253,005 29.60
03 Health Program 53,052 55.76 103,012 104.00
04 Relief & Rehabilitation Program 6,432 25.37 10,675 50.83
05 Environment Program - 20.53 - 59.39
Grand Total 258,169 172.41 451,885 369.56
Details of the Programs are mentioned below:
Education Program
Under Education Program there are three types of activities like (1) Scholarship (for the children of the beneficiaries secured GPA-5
in the SSC & HSC examination), (2) Academic Award (to the meritorious children of the members from class I to class IX) and (3)
Establishment of pre-primary school, maqtab & adult education centre in the project areas. Activities under Education Program
during the year-2014 at a glance are shown in the following table:

Directors’ Report
(In million Taka)
Activities Number Beneficiary Amount
Scholarship 693 693 13.77
Academic Award 22,190 22,190 13.88
Pre-School/maqtab 707 18,615 23.60
Total 23,590 41,498 51.25
Training Program
There are three types of training activities under the Program like (a) Skill Development Training (b) Self-employment Training and
(c) Centre Leaders’ Training. At a glance, activities under Training Program during the year-2014 are shown in the following table:
(In million Taka)
Leadership Training (Get-together) 164 42,743 10.02
Skill Development Training 2,198 114,260 8.74
Self-employment Training 184 184 0.74
Total 2,546 157,187 19.50
Chemical industry

Directors’ Report
Health Program medical camps (general, eye & circumcision), (3) Medical
Assistance and (4) Assistance to Mother & Neonatal. The
Under Health Program, there are four types of activities like activities under Health Program during the year-2014 at a
(1) Installation of Tube-well & Sanitary Latrine, (2) Conducting glance are shown in the following table:
(In million Taka)

a. Water & Sanitation
i. Quard for tube-well 2,838 2,838 16.85
ii. Quard for sanitary latrine 1,146 1,146 5.11
Sub-total 3,984 3,984 21.96
b. Medical Assistance
i. General medical camp 129 22,171 2.58
ii. Eye Camp 21 2,140 0.53
iii. Circumcision Camp 26 702 0.78
iv. Cash assistance 1,588 1,588 7.45
Sub-total 1764 26601 11.34
c. Gift to the newborn baby: 22,467 22,467 22.46
Total 28,215 53,052 55.76
Relief & Rehabilitation Program dues, (b) Relief & Donations and (c) Rehabilitation Quard.
Activities under Relief & Rehabilitation Program during the
Under the program, 3 types of assistance are being provided year-2014 at a glance are shown in the following table:
to the poor and distressed members like (a) Waiver of Bank’s
(In million Taka)

Activities Beneficiary Amount
a. Waiver of Bank’s dues 1,008 10.46
b. Quard for Rehabilitation
i. Of the distressed members 129 1.16
ii. Of the hardcore poor 892 4.41
Sub-total 1,021 5.57
c. Relief & Donations
i. For Marriage purpose 956 4.74
ii. For Burial purpose 502 1.25
iii. For Disaster relief 2,945 3.35
Sub-total 4,403 9.35
Total 6,432 25.37
Environment
to implant another two. Since 2003, the Bank has distributed
The Bank has been observing Plantation Program during about 4,160,022 saplings at a cost of Tk.59.39 million out of
the rainy season every year since 2003. Each of the RDS which 723,672 sapling were implanted at a cost of Tk.20.53
members are given one sapling free of cost and encouraged million during-2014.

Directors’ Report
Motor Cycle Assembling Industry
Agricultural Investment The Bank has disbursed Tk. 9,010.00 (achievement 117%)
million in agriculture sector against its target of Tk. 7,720.00
Islami Bank Bangladesh Limited has been giving due million among 209,265 farmers/investment clients during
importance on agricultural/rural investment since its 2014. Besides, under the special program of Bangladesh
inception. To make it more convenient, three investment
Bank (investment in cultivation of pulse, oil seed, spices
schemes like Agricultural Implement Investment Scheme
& maize at discounted rate of profit 4%), IBBL has already
(AIIS), Rural Development Scheme (RDS) and Micro
Enterprise Investment Scheme (MEIS) have been introduced disbursed Tk. 10.55 million against targeted amount of
in 1992, 1995 & 2005 respectively. Tk.10 million.
Agri. Investment of IBBL vs. Banking Industry in Bangladesh

(In million Taka)
% of Growth Over the Previ-

Target Disbursement % of Achievement
ous Year
Fiscal Year
National IBBL National IBBL National IBBL National IBBL
2009-2010 115,000 8,800 111,170 8,410 97% 96% 20% 35%
2010-2011 126,174 9,500 121,844 10,210 97% 107% 10% 21%
2011-2012 138,000 10,000 131,320 11,703 95% 117% 15% 15%
2012-2013 141,300 7,250 146,670 13,074 104% 180% 12% 12%
2013-2014 145,950 7,550 160,368 13,199 110% 175% 9% 1%

Directors’ Report
Sector-wise Disbursement under Agricultural Non-Performing Investment

Investment
IBBL’s position was better than national non-performing
Sector-wise disbursement under agricultural investment of Investment position. Classified Investment as on 31.12.2014
IBBL in 2014 is shown in the following graph: was 4.76% of total investment. Written off Investment as on
31.12.2014 was 0.75% of total investment.
Sector Wise Distribution in 2014
NPI in IBBL
(In million Taka)
SL Particulars 2014 2013
Crops NO.
Fisheries
1. NPI (NPL) Ratio at IBBL 4.92% 3.71%
Livestock
Agri. Imp. 2. Industry Average of NPL N/A 8.93%
Poverty Alle. 3. Required Provision 9291.20 7,262.04
Storage
Others 4. Provision Maintained 9,291.20 7,262.04
5. Provision Maintained Ratio 100% 100%
Foreign Exchange Business

Asset Quality
IBBL is playing a vital role in the Foreign Exchange Business
IBBL continues to maintain strong asset quality despite of the Country. During the year 2014, IBBL handled
many odds in macroeconomic fundamentals. Investment Tk.848,447.00 million Foreign Exchange Business registering
facilities are allowed in a manner so that credit expansion 9% growth over previous year. 53 Authorized Dealers (ADs)
goes on ensuring optimum asset quality. Investment handle Import, Export and Remittance businesses being
facilities are extended to customers who comply bank’s licensed by Bangladesh Bank. The comparative figures are
norms and principles. given below:
(In million Taka)

2014 2013 % of growth in
2014 over 2013
Particulars
Amount % of Total Amount % of total
Import 316,971 37 285,900 37 11

Export 222,753 26 205,269 26 9
Remittance 308,722 27 286,956 27 8
Total 848,447 100 778,125 100 9
Import
During 2014, IBBL handled Tk. 316,971.00 million import

with 11% growth over previous year. During 2014, the Bank
opened 67,237 Letters of Credit as against 61,471 of the
previous year showing 9% growth. The import performance
of IBBL for the last five years is shown below: 246,281 301,207 284,587 285,900 316,971

Directors’ Report
Item wise Import Position

(In million Taka)
2014 2013 Growth % in 2014
Sl. Items
Amount % toTotal Amount % to total over 2013
1 Raw Cotton, Yarn, Fabrics & Accessories 108,588 34.26 117,875 41.23 -7.88
2 Capital Machinery 17,516 5.53 13,661 4.78 28.22
3 Fertilizer 24,292 7.66 15,322 5.36 58.54
4 Wheat 7,317 2.31 9,625 3.37 -23.98
5 Iron, Steel & Other base Metals 4,274 1.35 6,687 2.34 -36.08
6 Motor Vehicles 3,748 1.18 4,603 1.61 -18.57
7 Chemicals 8,047 2.54 6,883 2.41 16.91
8 Edible Oil (Crude & Refined) 2,794 0.88 6,819 2.39 -59.03
9 Rice 10,595 3.34 2,615 0.91 305.16
10 Scrap Vessel 4,003 1.26 2,141 0.75 86.97
11 Others 125,801 39.69 99,669 34.86 26.22
Total 316,971 100 285,900 100 10.87
Export
Export Business of IBBL during 2014 stood at Tk. 222,753.00
million against Tk. 205,269.00 million in 2013 registering
9% growth over the previous year. During 2014, the Bank
handled 69,784 Export Bills as against 65,415 Export Bills in
2013 showing 7% growth.
Item wise Export Position

(In million Taka)
2014 2013
Growth % in
Sl no. Items
Amount % to total Amount % to total 2014 over 2013
1 Garments and Textile 174,259 78.23 167,539 81.62 4.01
2 Frozen Foods & Vegetables 3,762 1.69 2,797 1.36 34.50
3 Jute & Jute Goods 10,857 4.87 10,936 5.33 -0.72
4 Leather 830 0.37 377 0.18 120.16
5 Tea 0 0.00 - 0.00 0.00
6 Chemical 318 0.14 92 0.04 245.65
7 Others 32,727 14.69 23,529 11.46 39.09
Total 222,753 100.00 205,270 100.00 8.52

Directors’ Report
Garments Industry
Business Performance of OBU
Sl no Position as on 31.12.2013 Position as on 31.12.2014

% of Growth in 2014
Nature of Business Million USD Million Taka Million USD Million Taka over 2013
1 2 3 4 5 6 9
1 Investment & Placement

208.53 16,100 195.37 15200 -6%
(outstanding)
2 Operating Profit 5.79 447 8.44 652 46%
Mudaraba Documentary Import Bills
Particulars 2013 2014

% of Growth
Sl.
Nos. of million million Nos. of million million in 2014 over
No. 2013
Issue USD BDT Issue USD BDT
1 No. of Branches availing UPAS 15 25 67%

facility N/A N/A N/A N/A
2. No. of clients availing UPAS facility 29 N/A N/A 72 N/A N/A 60%
3. Total L/Cs opened under UPAS 1050 327 24550 1408 434 33799 38%
4. Disbursement of UPAS facility 1482 286 22150 1925 337 26272 19%
5. Adjustment of UPAS facility 1062 248 19200 1793 346 26614 39%
6. Outstanding UPAS import Bills 816 162 12500 954 158 12324 -1.41%
7. Outstanding L/C opened under 203 69 5370 310 130 10173 89%
UPAS
8. Income earned by OBU being share 1062 5.72 443 1793 8.36 652 47%
90% profit of related import Bills

Directors’ Report
Contribution of OBU in Foreign Trade
SL No. Particulars 2014 Remarks

Nos. of Issue Million USD Million BDT
1 Import under UPAS facility 1408 434 33,799
2. Import under HPSM investment in FC 30 64.61 5,040
3. Sub Total (Import ) 1,438 498.61 38,839 12% of total Import
4. Export under MDB in FC 4926 182 14,053 6% of total Export
Total trade business 6364 680.61 52,892
Central Processing Center (CPC) Specialist (CDCS). It is worth mentionable that IBBL alone
has 136 CDCS out of 306 CDCS in the country.
IBBL processes Import/Export transactions through CPC,
the first ever scan based and paperless trade centralization Foreign Remittance
network in the country, which is considered to be the largest
Foreign Trade Processing Hub of the country. The Centralized IBBL has long been enjoying competitive advantage
Foreign Trade Processing system derived following benefits in foreign exchange business and retained its market
towards overall growth of the Bank: leadership in the area. It deals about 35% Foreign Remittance
messages (transactions) of the country. This is also the
a. Sanction Screening and AML Checking from Central largest remittance service provider in the banking sector of
Hub before any Foreign Trade Transaction; Bangladesh and quite capable to process more than the total
b. Economies of scale for trade processing; inward remittance messages (transactions) of Bangladesh.
c. Faster compliance of new Rules, Regulations of
Different Product and Services
Bank & other Regulatory bodies Efficient and quality
processing; IBBL processes about 40000 FTTs per day and centrally
d. Reducing the possibility of income leakage; and credits about 20000 FTTs instantly to the beneficiary’s
accounts on behalf of our different branches. About 300
e. Proper MIS due to quality entry in eIBS i.e core banking accounts of the expatriates are opening and around 300
software. cheques are being processed daily by the Bank. About 4000
Number of Letter of Credit (L/C) opened during the last five queries of customer are handled per day.
years are shown in the following chart:
Application Programming Interface (API) System
Application Programming Interface (API) is the latest tools
and arts of the technology in Foreign Remittance Business.
By this application Foreign Bank/ Exchange House is
enabling to credit remittance to the IBBL beneficiary’s
account instantly or ready for payment instantly while the
remitter is still in front of the counter. A good number of
Foreign Exchange Houses are operating their remittance
business with us by using the system.
Online Money Transfer System

Trade Expertise
Trade Processing Hub has become a prestigious project Online Money Transfer System is a long step of IBBL towards
of the Bank and has attracted the attention of our Foreign green banking since 2011. It is the own web based software
Correspondents at large, not only through processing, but of IBBL to provide Spot Cash (over the counter) payment.
also with its continuous efforts in developing the knowledge By using the system beneficiary can receive their remittance
base, skill and efficiency of the total Foreign Exchange over the counter from any branch of IBBL. About 90 Foreign
manpower. Various training programs have been undertaken Banks and Exchange Houses have been using this system to
to increase the number of Certified Documentary Credit provide Spot Cash services.

Directors’ Report
Web Based Spot Cash which is being credited centrally all over the branches of
Web based Spot Cash became World Wide popular product IBBL just after receiving the same from Banks/Exchange
among the expatriates as well as the beneficiaries of the Houses abroad. More than 20,000 remittance messages are
Foreign Remittance. Under this arrangement, beneficiaries credited to the beneficiary’s accounts of IBBL instantly.
can receive remittance through the PIN Code from any
branch of corresponding local banks by showing their Bangladesh Electronic Fund Transfer Network (BEFTN)
national identity. IBBL has established such arrangement
with 17 renewal Foreign Banks and Exchange Houses. Total IBBL became a member of BEFTN since its inception
share of the Spot Cash Transactions of IBBL is about 45% of for settlement of 3rd Bank foreign remittance payment
its total remittance business. with the stipulated time. IBBL routs about 2,000 foreign
Central Account Crediting System remittance messages to other banks daily for crediting to
In this system, Beneficiaries get their money immediately, the beneficiary’s accounts.
Performance of Remittance Products

(In million Taka)
Sl Particulars As on 31.12.2013 As on 31.12.2014 Growth Amount Growth %
1 Total number of transactions 7.79 8.17 0.38 4.89
2 Amount 286,956.00 307,961.00 21,005.00 7.32
3 Central Account Credit 129,207.00 136,623.70 7,416.70 5.74
4 Spot Cash 66,569.00 79,439.80 12,870.80 19.33
5 BEFTN 21,626.30 22,175.40 549.10 2.54
Remittance Performance Country wise Remittance Inflow
Over the last 10 years (2005-2014), remittance inflow of It is observed that key share of remittance of IBBL has been
IBBL has grown up by around 37 percent. In comparison coming from KSA with contribution of 35% over the year.
with 2012, the amount of remittance slightly slowed down Other major remittance source countries are UAE, USA,
in 2013 which has been recovered in 2014. Despite slow Malaysia, Kuwait, Oman and Bahrain with contribution of
growth, IBBL could manage to maintain its leadership in 15%, 12%, 10%, 8%, 7% and 6% in 2014 respectively.
foreign remittance performance.
Country Wise IBBL Remittance inflow in 2014
10%
(In Million USD)
Volume (Million USD)

Directors’ Report
Awarded Gold Medal to IBBL for Outstanding Contribution in Foreign Remittance Services
Remittance Arrangement Corresponding Banking Highlights
IBBL established relationship with 8(eight) new Exchange Islami Bank Bangladesh Limited has been establishing
Houses in 2014 resultantly the number of Exchange Houses/ and maintaining network of relationship with financial
Bank stood at 128 to operate remittance business. institutions in order to facilitate foreign exchange business.
Deputation of Representatives Brief pictures of relationship status of IBBL are as follows:
Till 2014, IBBL has deputed a total number of 55(fifty 1 Number of Nostro accounts 41
five) representatives at different exchange houses/
2 Number of currencies Nostro A/Cs are 12
banks in abroad. Among them, at present, 31(thirty-one)
maintained
representatives are working in four countries. In 2014, we
have deputed 7 (seven) officials to different countries. 3 Number of RMA (Arrangement for 597
authenticated financial communications)
Visit to Abroad for Remittance Mobilization
4 Number of Countries with RMA 82
In order to expedite the remittance mobilization activity, a 5 Number of Banks with RMA 243
good number of high delegation of the Bank visited to KSA,
6 RMA established in 2014 31
Oman, Qatar, Singapore, USA, and Malaysia etc. during 2014.
7 Number of Correspondent banks paid visit to 65
Visit by Exchange Houses our Bank
Throughout the year, a total number of 20 (Twenty) exchange 8 Number of International Agencies visited our 10
houses visited our bank and exchanged views on mutual Bank
business interest growth. The major exchange houses are
Money Gram Payment System, UAE Exchange UAE, Xpress Visit by Correspondent Banks
Money UAE, Al Amoudi Excchange KSA, IME SDN Berhad During this time, a total number of 65 (sixty five) foreign
Malaysia, Transfast USA, Prabhu Money Transfer, USA, Ria correspondents and some International agencies visited
Money Transfer, USA, etc. the Bank and shared views on mutual business interests.
Remittance Marketing Efforts The major foreign banks are Standard Chartered, Mashreq,
JP Morgan Chase, Commerz AG, ICICI India, Axis India,
In 2014, we have taken a number of marketing initiatives
UBAE Italy, Sumito Mitsubishi Banking Corporation Japan,
with a view to boost up remittance with different exchange
Unicredito Italiono Bank, Italy, Habib AG Zurich Switzerland,
houses. On the occasion of ICC T20 World Cup-2014 held in
Bank of Montreal Canada, Zorcher Kantonal Switzerland,
Bangladesh, we have arranged mega marketing activities in
HDFC, India, KBC NV, Ireland, Banque Cantonale de Genova,
collaboration with Money Gram. We have conducted another
promotional offer with Xpress Money on the occasion of Switzerland, Bank of Tokyo Mitsubishi, Emirates NBD Bank,
Eid-ul-Adha .We have also conducted some programs for UAE, Westpac Banking Corporation, Australia, UBI Banca,
remittance mobilization, Free Medical Camp, Remittance Italy, Grupo Banco Populare Espanol, Italy etc. The major
Fair, participated in NRB conferences both home and abroad.

Directors’ Report
agencies visited our Bank are International Finance wishers and expresses thanks and gratitude to them for their
Corporation (IFC), World Bank Group, Islamic Corporation for valuable support and confidence reposed on the bank.
the Development of the Private Sector (ICD) of IDB Group,
International Monetary Fund (IMF) and Asian Development Finally, the Board would like to express its great appreciation
Bank (ADB), Japan International Cooperation Agency (JICA), and thanks to all the officials and staff of the Bank for their
Japan Credit Bureau (JCB), Japan visited the Bank in different untiring efforts, leadership and dedication for bringing about a
schedule and discussed with the senior management on better performance of the Bank during the year.
mutual business potential. In conclusion, notwithstanding the fact that Islamic banks
Corporate Governance have been able to shield themselves from the spillover impact
of the global economic recession, no one can predict the
The Bank makes sure that the guidelines and regulations extent to which the Islamic finance’s principles will serve to
issued by Bangladesh Bank and Bangladesh Securities and protect it from the looming financial crisis. Whilst some have
Exchange Commission are properly followed. Details have pointed out that it is already knotted with the mainstream
been presented in the earlier pages of this Annual Report finance whereby its future is as risky as any other part of the
under the title “Corporate Governance”. global financial industry, experts in Islamic finance believe
Vote of Thanks that their way of carrying out finance-related activities has
shielded them from the global credit crisis and hence, the
The Board of Directors expresses its deepest gratitude to model stands on its own merit. London, Singapore, Paris
the Almighty Allah for enabling the Bank to achieve steady and Hongkong the financial heartthrob of the world, are
progress in all aspects of operations during the year 2014. competing with each other to become centre of excellence
The Board extends thanks to the Ministry of Finance, the in Islamic finance. Reputed banks like Standard Chartered,
Bangladesh Bank, the Bangladesh Securities and Exchange HSBC and Citi Bank have already set up Islamic banking
Commission, the Dhaka Stock Exchange Limited, the subsidiaries that are flourishing.
Chittagong Stock Exchange Limited, the National Board of
Revenue, the Registrar of Joint Stock Companies, Statutory May Allah, the most Merciful bestow on us courage,
Auditors and the Government Agencies for providing dedication, patience and fortitude to serve the cause of
necessary assistance, guidance, support and co-operation at Islam and also of Bangladesh and run the Bank as per the
various stages of operations of the Bank. With deep sense of vision and mission put forth earlier and tenets of Islamic
gratitude, the Board also keeps on record the excellent co- Shari’ah. Ameen.
operation, exchange of views and constant support of the
Dated, Dhaka
Islamic Development Bank (IDB), other national and overseas
March 21, 2015
Islamic Banks and Financial Institutions.
The Board appreciates the support and co-operation received
from overseas correspondents of the bank all over the world.
The Board particularly likes to record its appreciation for the
Shari‘ah Supervisory Committee whose guidance has enabled
the Bank to conduct its business complying Islamic Principles.
The Board of Directors also extends the best compliments to
all of its valued Shareholders, Depositors, Investment Clients, Engr. Mustafa Anwar
Print and Electronic Media and other stakeholders and well- Chairman (C.C.)

Risk Management
Meeting of the Risk Management Committee

Risk Management Framework and Procedure g The Bank considers sound risk management to be the
foundation of a stable financial institution.
Banking Business grows mainly by taking risk. Risk
management is the deliberate acceptance of risk for g The Bank continues to adopt a holistic and integrated
profit making. Banks have grown from being a financial approach to risk management and, therefore, brings all
intermediary into a risk intermediary at present. In the risks together.
process of financial intermediation, banks are exposed to
Risk management is governed by well-defined policies
severe competition and hence are compelled to encounter
g
various types of financial and non-financial risks. Risks that are clearly communicated across the Bank.
and uncertainties form an integral part of banking which
g Risk management is a shared responsibility. Therefore,
by nature entails taking risks. Profits are the reward for
the Bank aims to build a shared perspective on risks
successful risk taking in business. On the other hand,
that is grounded in consensus.
excessive and poorly managed risk can lead to losses and
thus endanger the safety of a bank’s depositors. g Risk-related issues are taken into consideration in all
business decisions. The Bank shall continue to strive
Risk Management is a discipline at the core of every financial
to maintain a conservative balance between risk and
institution and encompasses all the activities that affect its
revenue considerations.
risk profile. The essential functions of risk management are
to identify, measure, monitor, control and more importantly g Risks are reported openly and fully to the appropriate
mitigate the risk profile of the bank. levels once they are identified.
Risk Management Philosophy g Risk officers work as allies and thought partners to
other stakeholders within and outside the Bank, and are
Like other Banks, IBBL is also undertaking risks but as a
guided in the exercise of their powers by a deep sense
shari’ah based bank, its risks are mainly mitigated observing
of responsibility, professionalism and respect for other
shari’ah rules and regulations. Again it has its own risk
parties.
management philosophy for giving proper attention to
risk management. The key elements of the Bank’s risk g All subsidiaries are guided by the principles enshrined
management philosophy are as under: in the risk management policies of the Bank.

Risk Management
Risk Management Objectives Three Lines of Defense
IBBL has clear risk management objectives and a well- 1st Line of Defense 2nd Line of 3rd Line of
established strategy to address them, through core risk and Defense Defense
capital adequacy related risk management processes and
Day to day Risk Risk Oversight Independent
encompasses all the activities that affects its risk profile. At Management & Policy & Assurance
a strategic level, our risk management objectives are to: Management Control Methodology
g Identify the Bank’s significant risks, assess the same, Business Units • Board’s Risk • Audit
Management Committee
taking appropriate mitigating steps to ensure optimum Committee
and sustainable profitability;
Support Functions • Chief Risk Officer • Internal Audit
g Formulate the Bank’s risk appetite and ensure that
business profile and plans are consistent with it; • Risk • External Audit
Management • Supervision of
g Optimize risk/return decisions by taking them as closely Wing Regulators
as possible to the business, while establishing strong • Operational Risk
and independent review and challenge structures; Management
Committee
Ensure that business growth plans are properly
Responsibility and accountability for risk management
g
supported by effective risk infrastructure; remain at all levels within the Bank, from the Board, down
through the organization to each business manager, support
Manage risk profile to ensure that specific financial functions and risk owner.
g
deliverables remain possible under a range of adverse

business conditions; and Risk Management Framework
g Help executives to improve the control and co- Risk Management
ordination of risk taking across the business.

Committee of the
Board
Managing Director
Risk Management Culture

Risk Management
Co-ordination
Committee
Head of Risk
Management

Wing
g The Board and the Management promote a responsible
approach to risk.
Inv. Risk Foreign ICC Risk ICT Risk Money Laund.
g The responsibility of risk management is fully vested in

Mgt.
Cmt.
Exch. Risk
Mgt. Cmt.
ALCO Mgt.
Committee
Mgt.
Committee
Risk Mgt.
Cmt.
the Board of Directors, which in turn delegates this to

senior management; Supervisory
Review Process
Stress Testing
Committee
Basel
Implementation
Team Committee
g The risk management officials enjoy the sufficient

professional independence and stature; Board’s Oversight on Risk Management
g The Bank pays close attention to both quantifiable and The Board is responsible for approving risk appetite, the level
unquantifiable risks; of risk the Bank chooses to take, in pursuit of its business
objectives. It oversees the management of the most
g The Bank’s management ensures that risk and risk significant risks through the regular review of risk exposures
management awareness is enshrined throughout the and key controls.
Bank; and As per the obligations of the Bank Company (Amendment)
Act 2013, section 15 (kha), and BRPD Circular No. 11 dated
g The Bank avoids any business where the associated October 27, 2013 of Bangladesh Bank, IBBL formed its
risks cannot be objectively assessed or managed. Board’s Risk Management Committee (RMC). The Committee
monitors the Bank’s risk profile against the agreed appetite,

Risk Management
where actual performance differs from expectations, the g Adopting proper financial protection measures
actions are being taken by management and reviewed to through risk transfer, risk avoidance, and risk retention
ensure that the RMC is comfortable with them and guides programs;
the Management for taking pragmatic steps. The Specific
Determining the most cost‐effective way to construct,
Roles of the Committee are as under:
g
refurbish, or improve the loss protection system of any facility

g Approval of Risk Identification and Mitigation leased, rented, purchased, or constructed by the Bank;
Techniques;
g Managing claims for insured and uninsured losses; and
g Preparation of Organizational Structure;
g Participating on all contract negotiations involving
g Review of Risk Management Policy and Approval; insurance, indemnity, or other pure risk assumptions or
provisions prior to the execution of the contracts.
g Maintaining Information and Reporting System;
Risk Management Process
g Supervising the overall risk management policy and
implementation of the same; The Risk Management process is then segregated into
five steps: establishing the context, risk identification,
Miscellaneous issues like submission of the decisions risk analysis, risk evaluation and risk treatment. From
g
and recommendations of the Committee before the the each steps of the risk management process, there is
board quarterly, compliance of the instructions of the sufficient option for communication, consultation, reporting,
Regulatory Authorities from time to time, evaluation monitoring and review system.
report of the internal and external audit reports etc.
Role of the Risk Management Function
In line with the risk management guidelines of Bangladesh

Bank, IBBL restructured its risk management process and
Risk Management Wing oversees the overall functions with
specific terms of reference:
g Designing bank’s overall risk management strategy;
g Developing and overseeing implementation of stress
tests;
g Developing, testing, and observing use of models for
measuring and monitoring risk;
g Informing the board and All Risk Committees about the
appetite for risk across the Bank;
Communicating views of the board and senior Core Risk Management
g
management throughout the Bank;

IBBL exclusively manages 6 (six) core risks and has designed
g Independently monitoring limits, in addition to the
and implemented its own Risk Management Guidelines in
monitoring that is done by business units;
accordance with the guidelines prescribed by the Central
g Establishing risk management policies and procedures; Bank and formed 6 core risk management committees
which conduct meetings periodically. The major concerns of
g Formulating guidelines on the handling of all property
the committees are as under:
and liability claims involving the organization;
a) Investment Risk Management Committee supervises and
g Developing and implementing loss prevention/loss
monitors investment concentration, investment risk grading,
retention programs;
corporate clients rating, non performing investment,
g Identifying and quantifying Bank’s exposures to residual risk against investment, provision against classified
material loss; investment, investment mix, asset quality etc.
g Securing and maintaining adequate loss coverage at b) Foreign Exchange Risk Management Committee
the most reasonable cost; oversees foreign exchange risk, treasury, net open

Risk Management
position, import & export business, dealing room risks and hence are advised by Bangladesh Bank to form a
operations and anti-money laundering aspects in foreign Supervisory Review Process Team in each Bank. IBBL has
exchange transactions and remittance etc. formed the committee which is headed by the Managing
Director of the Bank.
c)
Information & Communication Technology Risk
Management Committee monitors and supervises the c) Stress Testing Committee
risks related to data security, physical security, network The Central Bank also instructed the banks to conduct
security, disaster recovery, fraud, forgery, system failure periodical stress testing on some statistical simulations
and business continuity etc. assuming different risk aspects of the Bank. Herein, all the
d) Money Laundering Risk Management Committee looks potential stresses are given on the capital base of the Bank
after the money laundering activities, STR, CTR, KYC and in order to foresee the total risks and strengthen the Banks
TP related compliances. The committee also supervises capital. In order to perform this task, IBBL has formed a
and monitors the entire transactional activities of the committee namely stress testing committee.
Bank including money laundering aspects involved with Relationship with Risk Management & Other Units
foreign exchange transactions.
Board’s RMC
e) Internal Control and Compliance Risk Management
Committee assesses and mitigates the risk related to MD & CEO
compliance with regulatory requirements, set rules of the Business Units
Analys
Enquiries
Reporting Regulators
Bank, internal checking system, lapses, frauds, forgeries, Reporting Risk
violations of the set rules etc. Management
Wing Risk
Enquiries Summarv Rating
Auditors
f) Asset Liability Committee (ALCO) looks after the asset- Reporting
Agencies
liability risk, liquidity risk, Investment Deposit Ratio (IDR), RMCC

deposit mix, investment mix, gap analysis etc. under Stress Testing
Report RWA
Basel Impl.
Committees
direct guidance of CEO. Committee Recommend
Recommend
ICAAP
Report &
Basel Accord Implementation Financial Budget
Analysis
Administration Core Risk Operations
Banking industry in Bangladesh is highly regulated. Central Division Capital Allocation Committees
Reporting
Bank of the country is very much aware to keep the capital

of individual Bank as per international standard and for Risk Management Wing (RMW) is directly involved with the
this reason, Bangladesh Bank issued guidelines on Risk total risk management process of the Bank. The major job of
Based Capital Adequacy (RBCA) for Banks and separate RMW is to integrate the risk issues, bank-wide risk monitoring
Supervisory Review Process Guidelines under Basel II. and reporting. Other units provide relevant data to RMW and
Recently, BB issued comprehensive guidelines for Basel it makes recommendation on capital allocation, budgeting
III with an implementation phase from 2015 to 2019. To and pricing, portfolio structuring, liquidity management,
implement the Basel capital adequacy guidelines, we have setting risk appetite, compliance culture etc. based on the
the following committees: risk reports and Risk Management Papers (RMPs).
a) Basel Implementation Committee b) Supervisory Review
Process Team, and c) Stress Testing Committee. Risk Management Meeting
The Management Committee of the Bank has also formed a
a) Basel Implementation Committee strong Risk Management Co-ordination Committee (RMCC)
comprising heads of all the risk taking organs of the Bank
This Committee is responsible for implementing Basel which is arranged and organized by Risk Management Wing.
Capital Accord with particular focus on Pillar-1 risks that The committee sits at least once in a month or more when
is to address investment, market and operational risk. IBBL necessary. In the meeting of RMCC, all the existing/identified
has been linking its risk profile with the capital which is the and foreseeable/potential risks issues are discussed and
major and primary risk absorbing tool. make recommendations to the concerned risk taking organs
to address, measure and take the required steps to mitigate
b) Supervisory Review Process Team
the risk factors. All the meeting minutes along with all
Banks also face some other risks which varies from the Risk Management Papers (RMPs) are reported to the
country to country, business to business. Hence, banks are Department of Off-site Supervision of Bangladesh Bank on
somewhat independent to identify and assess the additional quarterly basis.

Risk Management

Risk Management Disclosures g Continuous review and monitoring of the top 200
Investment clients;
Risk Appetite
g Continuous review and monitoring of the top 200
The Bank’s risk appetite is established by the Board and classified and investment clients and top 50 legal
reviewed on a quarterly basis. The Bank’s appetite for risk is issues;
governed by the following:
g Review of pricing;
g high-quality risk assets as measured by ratio of non-
performing investments to total investments and Priorities for 2015
maximum average internal risk rating of the investment
Increasing capital adequacy ratio and maintaining
portfolio;
g
adequate capital base for adopting Basel-III Capital

g a diverse investment portfolio to ensure there are no Accord;
undue concentration concerns taking into consideration
g Restructuring and diversification of the investment
the business unit, business sector, country at risk and
portfolio to address concentration risk;
asset portfolio tenor;
Optimization of gap and duration gap between assets

g
g losses due to operational risk to be constantly
and liabilities;
monitored and to be lower than industry averages;
g Maintaining optimum liquidity and maintaining Liquidity
financial and prudential ratios to be pegged at levels
Coverage Ratio (LCR) and Net Stable Funding Ration
g
more conservative than regulatory requirements – (NSFR) at the optimum level;

Investment to Deposit Ratio (IDR), Capital Adequacy,
Deposit Concentration etc.; and g Reducing RWA through portfolio restructuring, optimum
rating of corporate and SME Investment clients and
the Bank strives to minimize the independent indicators improving the ratio of RWA and total assets;
g
of excessive risk appetite like overdue audit queries,

adverse publicity and fines & regulatory penalties: g Introducing the risk-based investment pricing
The Bank does not compromise its reputation through g Developing framework and data base for Internal Rating
unethical, illegal, unprofessional conduct or violation of the Based (IRB) approach.
commandments of Islam and the Bank has a zero appetite Implementation of Core Risk Management Guidelines
for association with disreputable individuals, entities and
activities. Bangladesh Bank conducts inspection on implementation
of the core risk guidelines of the Bank each year. Last
Key Initiatives in 2014 inspection was conducted based on the accounts as on
g Review of all the Risk Management Policies; 30.06.2014 and we have taken effective initiatives to ensure
implementation of all the observations of the central bank.
g Review of Investment Manual; Meanwhile, we implemented most of the observations and
have communicated the same to the competent authority of
g Key Risk Indicators of all core risk areas;
the central bank well ahead of the deadline.
g Risk Assessment Methodology and Evaluation of the
Risk Management and Capital Requirement
core risk areas;
g Review of Internal Capital Adequacy Process Document; Investment Risk Management
g Fraud Risk Management Policy; Investment risk concerned with the possibility of financial
losses due to counterparties’ inability or unwillingness to
g Policy for Deferred Letter of Credit; make contractually-agreed-upon payments. Analyses of
g Guidelines for Obtaining Collateral Security from banking industry data indicate that 85% of the total RWA
Investment Clients; emanated from credit risk while the same was 90% for
IBBL. As such, investment risk is key factor of IBBL’s risk
g Terms of Reference (ToR) for all the risk Committees; management framework.

Risk Management
Investment Risk Management Policy Office level, there is Investment Appraisal Committee which
mainly appraise and recommend the proposals.
IBBL’s Investment Risk Management Policy is approved by the
Bank’s Board of Directors, which plays a central and strategic
role in managing daily business activities. The policy defines Investment Portfolio and Risk Weighted Assets
the principles encompassing client selection, due diligence, Islami Bank Bangladesh Limited follows the standardized
early alert reporting, tolerable levels of concentration risk and approach for assessing investment risk and the Risk Based
portfolio monitoring, in line with the Bank’s risk appetite. The Capital Adequacy Guideline prescribed by Bangladesh Bank.
approach is to avoid large investment risk on a counterparty According to the aforesaid guideline, the risk weight categories
or portfolio level by applying stringent standards combined are 0%, 20%, 40%, 50%, 60%, 75%, 80%, 100%, 125% and 150%.
with sound collateralisation where feasible. The policy is Risk weight wise exposure of the Bank is as under:
reviewed regularly by the Board of Directors and updated
throughout the year to ensure consistency with the Bank’s
business strategy. A monthly Investment Risk Management
Committee meeting chaired by the Head of Investment Wing
drives policy decisions and implementation plans.
Investment Processing and Approval Structure

IBBL, being the largest investment portfolio-dealing bank
of the country, has specific policies in place for inducting,
dealing, processing, sanctioning, handling overdue and non- 0 20 40 50 60
performing investments of the Bank. The Board of Directors 75 80 100 125 150
of the Bank delegates sanctioning power from the Board to
the Branch Incumbent. The investment approval procedure
is being followed in accordance with the approved policy of It is evident from the graph that around 72% of the exposure
the Bank. of the Bank lies under the Risk weight category of 50%
or below, which is considered to be one of the significant
In every approval units i.e. at the Branch, Zone and Head strengths of IBBL.
Portfolio wise Exposure

(In crore Taka)
Particulars 2013 2014 Incr/Decr
Total Assets 55,146.78 64,797.85 9,651.07
Total RWA 28,769.57 33,670.14 4,900.57
Efficiency in RWA 52.17% 51.96% (0.21%)
Total Eligible Capital 4,551.19 4856.99 305.80
CAR 14.26% 12.83% (1.43%)
Outstanding against Corporate (on balance sheet + off-balance
28,576.17 31,225.28 2,649.11
sheet)
RWA against Corporate (On + Off balance sheet) 16,728.59 18,872.87 2,144.28
Efficiency in Corp RWA 58.54% 60.44% 1.90%
Unrated Corporate 1,984.81 2,805.91 821.10
RWA (Unrated) 2,481.01 3,507.39 1,026.38
Efficiency** 125% 125% 0.00%
Outstanding (Past due) 1,838.95 2,329.50 490.55
RWA (Past Due) 2,163.92 2,712.99 549.07
Efficiency in RWA (Past Due) 117.67% 116.46% (1.21%)
Others Assets 22,746.85 28,437.16 5,690.31
RWA against Others Assets 2,051.61 1,924.02 (-127.59)
Efficiency in RWA 9.02% 6.77% (2.25%)
** The risk weight for unrated investment clients is fixed at 125% by RBCA guideline of BB.

Risk Management
Capital Requirement against Investment Risk Assessment process (ICAAP), setting capital targets that
are commensurate with the Bank’s risk profile and control
As said earlier, the major portion of RWA arises from environment etc. For adequate supervision of capital
investment risk exposure. Out of RWA of Tk. 336,701 million functions and risks, Bank has formed a Supervisory Review
against investment risk award 94% emanated from Balance Process Team (SRPT) as stipulated in Bangladesh Bank’s
Sheet Exposure. The capital charge against investment risk guidelines.
was Tk. 33,670 million.
Internal Capital Adequacy Assessment Process (ICAAP)
Market Risk
In 2013, IBBL revised its own ICAAP document as directed
IBBL adopted Standardized Approach and follows the Risk by Bangladesh Bank which is duly approved by the Board of
Based Capital Adequacy Guidelines issued by Bangladesh the Bank. In accordance with the document, IBBL identified,
Bank for assessing the Market Risk. There are four assessed the risk areas which the Bank faces in its day to
components from which Market Risks are evolved. The day business and calculated capital charge thereagainst.
components are as under: In accordance with approved ICAAP document, IBBL
 Profit/Interest Rate Related Instruments conducts rigorous review on its risk exposure and allocates
 Equities the required capital for the same which are annually being
reported to the Central Bank.
 Foreign Exchange Position
 Commodity Risk Stress Testing
Being a Sharia’h based Bank, IBBL does not deal with any IBBL conducts periodical stress tests and assesses stress
profit/interest related instruments and purchases goods/ on the capital both giving individual and combined shocks
commodities from the seller and simultaneously sell the on different aspects. In case of giving individual shocks
same to the ultimate buyer. IBBL does not hold the goods/ deterioration of performing investment, increase of NPIs
commodities as owner of the same at any stage. As such,
due to default of top large borrowers, negative shift in
IBBL has no exposure under these components. The Market
NPI categories, decrease in FSV of collaterals, profit rate,
Risk Exposure of IBBL has been shown in Pillar-III Disclosure
under Basel-II part of the annual report. foreign currency appreciation, equity shocks are considered.
Combined shocks increases, FSV of the collateral decreases,
Operational Risks NPIs increases, negative shift in NPI categories, profit rates,
foreign currency appreciation.
Operational Risk is the potential loss arising from breakdown
in Bank’s systems & procedures and corporate governance Stress Testing results of all the quarters of 2014 reflect that
practices that results in human error, fraud, failure, damage the Capital Adequacy Ratio (CAR) of IBBL remains above
of reputation, delay to perform or compromise of the Bank’s
10% for both individual and combined shock at minor and
interest by employees.
moderate level. But at major level combined shock, the CAR
IBBL follows Basic Indicator Approach for assessing the reduces by 1% from the optimum level which is unlikely to
Operational risks. Under this approach, average of the happen in reality and indicates that IBBL has strong shock
Gross Incomes of last three years is taken as the proxy for absorbing capacity due to its capital strength.
operational risks. The average gross income for the last
three years was Tk.23,764 million. Therefore, the capital Investment Concentration Risk
charge against Operational Risk is Tk. 3564 million (15% of
It is known that the Economy of Bangladesh is not well
the average Gross Income).
distributed and IBBL is functioning under this economy. As
Supervisory Review Process such, IBBL has to run its activities in accordance with the
supply and demand rule of the Economy. IBBL is now ex-
IBBL is committed for continuous improvement of Bank’s posed to some of the specific sectors highly which is invit-
internal procedure for assessing the specific risk situation, ing concentration risk. On the other hand, the Bank has also
ongoing adjustment and further development of new concentrated its exposures in some specific regions since
methods of risk management and internal control, covering these regions are economically important. But IBBL has the
external factors as well as risk areas which are not taken scope to come out from such concentration gradually hav-
into account or partially taken into account while calculating ing a structural perspective plan. A comparative analysis of
Minimum Capital Requirements, quantifying the risks under sectoral and regional distribution of investments by IBBL is
pillar 2 of Basel-II, stress testing, Internal Capital Adequacy as under:

Risk Management
Sectoral Distribution Geographical Distribution

of Investment
1% 2% 3%
Agriculture Barishal
9%
Industry Dhaka
6%
Transport Chittagong
59%
Housing Rajshahi
20%
Khulna
Trade
Rangpur
Others
Sylhet
IBBL has the scope to diversify its investment portfolio in minuted and the action points are highlighted to ensure
more potential sectors & areas and distribution of the risk implementation. As a part of regulatory requirement, the
factors. management reviews the ALM Manual and its components
regularly.
Asset-Liability Risk
Liquidity Risk
To deal with Balance Sheet risk, IBBL has a dedicated
committee, called the Asset Liability Committee (ALCO) IBBL is running in a mixed economy where both interest
comprising of the senior officials of the bank to make based and Sharia’h based transactions are taken place at
important decisions related to the Balance Sheet, Liquidity the same time. But Sharia’h based money market is yet to
& Profit Rate risks of the Bank. be flourished and is under development process. Being a
Sharia’h based bank, it cannot lend or borrow money from
The ALCO generally meets at least once in every month and the conventional money market. As such, IBBL has to remain
reviews liquidity requirement, the maturity of Assets and always concern and vigilant regarding liquidity risk. IBBL
Liabilities, Deposit and Investment pricing strategy/transfer continuously monitor the liquidity ratios and periodically
pricing, Sensitivity of Assets and Liabilities, key Management conducts GAP and Duration GAP analysis. As on 31.12.2014,
Indicators and the Liquidity Contingency Plan of the Bank. the key liquidity ratios are as under:
In every ALCO meeting, the key points of the discussion are
Name of the Ratio Standard Ratio IBBL’s Scenario

Cash Reserve Ratio (CRR) 6.50% 7.81%
Statutory Liquidity Ratio (SLR) 5.50% 19.61%
Medium Term Funding Ratio (MTFR) ≥ 30% 97.86%
Maximum Cumulative Outflow (MCO) <20% 16.16%
Investment Deposit Ratio (IDR) <90% 79.88%
Foreign Exchange Risk Management Overnight, Stop Loss and Management Action Trigger),
Counter parties Credit limits set by the management and
The Bank is exposed in profit rate risk and settlement risk on adherence to the limits are ensured by the Treasury Front
account of its foreign exchange business. Foreign Exchange Office. All Foreign Exchange transactions are revalued at
businesses are involved in import, export and remittances weighted average exchange rate as provided by Bangladesh
including other auxiliary services. Foreign Exchange risks are Bank at the end of each month. All Nostro Accounts are
measured, monitored and addressed by Treasury Division reconciled regularly and outstanding entries are reviewed by
through front Office, Back Office and Mid Office. The Foreign the management for its settlement/recompilation. The open
Exchange Risk is minimized through proper Market analysis, position is maintained at the end of day within the stipulated
Real time pricing of Foreign Exchange and Money Market limit as prescribed by the Bangladesh Bank.
product, Fixation of different market related limits (Daylight,

Risk Management
Internal Control and Compliance Risk Management process. The ICT Risk Management exercise mainly include
minimizing financial and image loss to the institution in all
IBBL organizes its management through Internal Control events such as natural disasters, technological failure, human
& Compliance Wing consisting of three Divisions namely errors etc. The Bank uses own developed Core Banking
(i) Audit & Inspection Division (ii) Compliance Division, and Software to perform all types of transactions including
(iii) Monitoring Division to develop sound, sustainable and Local/Online/Internet in a secured way. To take care of its
secured growth of the Bank. core banking system, a separate security module has been
incorporated in the software which manages different roles
The Audit Committee of the Board subsequently reviews
for different users. All financial transactions can be tracked
the lapses identified by the Audit & Inspection Division,
for future audit purposes. The Bank uses Central Data Centre
Bangladesh Bank and other regulators. Subsequently
travelling through network uses encryption and decryption
appropriate actions are taken as per decisions of the said
mechanism.
Committee for protecting the Bank’s interest. Thus Internal
Control & Compliance (ICC) system of IBBL always plays Preparedness in Implementation of Basel-III
active role in mitigating operational risk and contributes in
the process of being a well compliant Bank. Bangladesh Bank vide BRPD Circular No. 18 dated December
21, 2014 issued Guidelines on Risk Based Capital Adequacy
Money Laundering Risk Management (Revised Regulatory Capital Framework for Banks in line
with Basel-III) wherein a roadmap for implementing Basel-III
In order to ensure the best corporate governance practices
framework is mentioned which is as under:
and aiming at protecting the Bank and its Employees,
Shareholders, Management and Customers, IBBL is
committed to comply with all the applicable Rules of the Anti Phases of Basel-III Implementation
Money Laundering Act, Anti-Terrorism Act. For mitigating
risks the Bank has formed Central Compliance Unit (CCU) 20.00%
under the leadership of the Chief Anti Money Laundering 0.625% 1.25% 1.875% 2.50%
Compliance Officer (CAMLCO) at Anti Money Laundering 10.00% 4.50%
4.50% 4.00% 4.00% 4.00%
1.50% 1.50% 1.50%
Department, Branches Control Division in Head Office. An 1.00%
4.50%
1.00%
4.50% 4.50% 4.50% 4.50%
independent CCU of the Bank is performing supervisory 0.00%

2015 2016 2017 2018 2019
and monitoring activities for the event of the aforesaid
programs on Anti-Money Laundering and Anti Terrorism
Financing. Anti Money Laundering Compliance Units are CET-1 Capital Additional T-1 Capital T-2 Capital Capital Conservation Buffer
also functioning under the leadership of the Branch Anti-

Money Laundering Compliance Officer (BAMLCO) and Zonal • According to guidelines on Basel-III, the minimum
Anti-Money Laundering Compliance Officer at Branches requirement for tier-1 capital will be 6% which is to be
and Zonal Offices respectively, who independently review built by 2019 but presently IBBL possesses 9.25% tier-I
the transactions of the accounts to verify Suspicious capital which is much higher than the required ratio.
Transaction Report (STR).
• Including capital conservation buffer of 2.5% which is
IBBL has introduced uniform Account Opening Forms, KYC to be built from 2016 to 2019, the common equity tier-I
(Know Your Customer) profile, and TP (Transaction Profile) capital requirement will be 7% while IBBL has much
and CTR (Cash Transactions Report) in the Bank as per above the requirement.
instruction of Bangladesh Bank. To establish fruitful Anti
Money Laundering drive at Branch level, IBBL introduced • The total Minimum capital requirement as per Basel-
ALM rating systems through self assessment report III will be 12.50% (from 2019) including capital
& independent testing procedure as per instruction of conservation buffer where IBBL’s capital adequacy as
Bangladesh Bank. on December 2014 remains 12.83% which is above the
requirement.
ICT Risk Management
Specific Risk for Islamic Banking
The Bank has adequately addressed Information & Being the Sharia’h based bank, IBBL may also face the
Communication Technology (ICT) Risk Management which following specific risks due to its operations in addition to
ensures ICT security functions and operations in a more the usual risks. IBBL remains always vigilant, stringent and
effective manner. It is an in-depth exercise and continual proactive to address and mitigate the risks:

Risk Management
a) Fiduciary Risk: Where Mudarabah Depositors’ funds c) Sharia’h Compliance Risk: IBBL is always stringent
are commingled with the Banks own funds, the bank about compliance Sharia’h rules in all of its operations.
shall ensure that the bases for asset, revenue, expense Since IBBL is performing in the mixed economic system
and profit allocations are established, applied and (i.e Islamic and Interest Based economy), Sharia’h
reported in a manner consistent with the Bank’s compliance is the one of the vital factors particularly
fiduciary responsibilities. for IBBL. The independent Sharia’h Board keeps keen
observations on the day to day transactions of the Bank
b) Displaced Commercial Risk: Banks may be under and they declare doubtful transactions as suspended.
market pressure to pay a return that exceeds the
rate that has been earned on assets financed by the d) Liquidity Risk for lack of non-structured Islamic
Mudaraba depositors when the return on assets is Financial Market: Since, Islamic Financial Market
under performing as compared with the competitors’ in Bangladesh is not strong enough and there is
rates. In such case, banks may decide to waive their inadequate Islamic financial instruments, IBBL has
rights to part or its entire mudarib share of profits limited scope for placement of fund with the desired
in order to satisfy and retain its fund providers and return from the market at the time of surplus liquidity
dissuade them from withdrawing their funds. and similarly limited scope in receiving fund complying
sharia’h rules at the time of liquidity crisis. However,
Asset liability management committee (ALCO) of
during the long 31 years of banking operations, IBBL
IBBL regularly meets to assess the fiduciary risk, rate
did not face any liquidity crisis since it remains vigilant
of return risk and displaced commercial risk if any in
IBBL, and recommends mitigating and encountering enough to address the issue.
the above risks.

Market Disclosure of Basel II
T
he purpose of Market Discipline in Basel II is to establish more transparent and more disciplined financial market
so that stakeholders can assess the position of a Bank regarding holding of assets and to identify the risks relating
to the assets and capital adequacy to meet probable loss of assets. For the said purpose, this “Disclosures on Risk
Based Capital (Basel II)” is made as per Bangladesh Bank’s Guideline
Scope of Application
Qualitative Disclosures
a) The name of the top corporate Islami Bank Bangladesh Limited
entity in the group to which The Consolidated Financial Statements of the bank include the financial statements of (i) Islami Bank
this guidelines applies: Bangladesh Limited (ii) Islami Bank Securities Limited (iii) Islami Bank Capital Management Limited
(including Off-Shore Banking Units (OBUs).
b) An outline of differences on A brief description of the Bank (Main Operation) and its subsidiaries are given below:
the basis of consolidation for Islami Bank Bangladesh Limited
accounting and regulatory
purposes, with a brief Islami Bank Bangladesh Limited was incorporated on March 13, 1983 as a Public Limited Company
description of the entities (Banking Company) with limited liability under the Companies Act 1994 as interest free Islamic
within the group (a) that are Shari’ah based commercial bank and commenced its operation on March 30, 1983 with the permission
fully consolidated; (b) that are of Bangladesh Bank. The authorized and paid up capital of the bank respectively stood at Tk.20,000
given a deduction treatment; million and Tk. 16,099.91 million as on December 31, 2014. Presently the Bank is operating its business
and (c) that are neither through Head Office having 294 Branches (including 30 SME/ Agriculture Branches) and 450 own ATM
consolidated nor deducted booths all over Bangladesh. The shares of the Bank are listed with both the Stock Exchanges of the
(e.g. where the investment is country, i.e. Dhaka Stock Exchange Limited and Chittagong Stock Exchange Limited.
risk - weighted). Subsidiary Companies
i) Islami Bank Capital Management Limited (IBCML)
IBCML is a fully owned subsidiary of IBBL. IBCML was established in April 2010 under the
Companies Act 1994 as a Public Limited Company with Authorized Capital of Tk.1000.00 million
& Paid-Up Capital of Tk.300.00 million. The Company was established as per Bangladesh Bank
Letter No. BRPD(R-1)717/2010-47 dated 07 February 2010. The registered Office of the company
IBCML is located at 20, Dilkusha C/A in Dhaka, Bangladesh.
ii) Islami Bank Securities Limited (IBSL)
IBSL is also a fully owned subsidiary of IBBL. IBSL was incorporated in March 2010 as a Public
Limited Company under Companies Act, 1994 with the objectives to carry out business of Stock
Broker & Dealer in the capital market. The authorized and paid up capital of the company stood at
Tk.5,000 million and Tk.2,700 million respectively as on December 31, 2013. The overall increase
of activities in Brokerage operation plays an important role in the improvement of capital market
of the country and enhances earning capability of IBBL through corporate declaration.
Off-shore Banking Unit (OBU)
c) Any restrictions, or other Off-shore Banking Unit is a separate business unit governed by the applicable rules & regulations
major impediment, on and guidelines of Bangladesh Bank. IBBL got permission to operate Off Shore Banking unit in its 3
transfer of funds or regulatory Branches under International Banking Wing.
capital within the group - Not Applicable.
Quantitative Disclosures
d) The aggregate amount of - Not Applicable.

capital deficiencies in all
subsidiaries not included in
the consolidation that are
deducted and name(s) of
such subsidiaries.

Capital Structure
a) Summary information on the As per the guidelines of Bangladesh Bank, Tier-1 Capital of IBBL consists of (i) Fully Paid-up Capital,
terms and conditions of the (ii) Statutory Reserve, (iii) General Reserve (iv) Non-Repayable Share Premium Account (v) Retained
main features of all capital Earnings (vi) Dividend Equalization Account and (vii) Minority Interest in Subsidiaries (viii) Non-
instruments, especially in the Cumulative irredeemable Preference Share.
case of capital instruments Tier-2 Capital consists of applicable amount of (i) General Provision (against Un-classified Investments,
eligible for inclusion in Tier 1 Off-Balance Sheet exposure & Off-Shore Banking Units) (ii) Assets Revaluation Reserves up to 50%, (iii)
or Tier 2. Revaluation Reserve for Securities up to 50% and (iv) Subordinated Debt (Mudaraba Perpetual Bond)
(up to max. 30% of eligible Tier-I capital). (v) Revaluation Reserve for equity instruments up to 10% (vi)
All Other Preference Shares.
b) The Amount of Tier 1 Capital, with break-up
As on December 31, 2014
Particulars (In million Taka)
Solo Consolidated
A Tier-I (Core Capital)
i Fully paid-up Capital 16,099.91 16,099.91
ii Statutory Reserve 16,099.91 16,099.91
iii Non-repayable Share Premium account 1.99 1.99
iv General Reserve 377.16 377.16
v Retained Earnings 2,414.97 2,386.66
vi Minority interest in Subsidiaries 0.06
vii Non-cumulative irredeemable preference shares - -
viii Dividend equalization account 32.00 32.00
ix Other (if any item approved by Bangladesh Bank) - -
Sub-Total (Core Capital) A (i to ix) 35,025.95 34,997.69
B Tier 2 and Tier 3 capital

i Tier 2 capital 13,543.92 13,543.92
ii Tier-3 (Eligible for market risk only) - -
Sub Total (Supplementary Capital) B (i+ii) 13,543.92 13,543.92
a) Other deductions from capital - -
C Total Eligible Capital (A+B) 48,569.86 48,541.61
Capital Adequacy
a) A summary discussion of The Bank has adopted Standardized Approach (SA) for computation of capital charge for investment
the Bank’s approach to risk and market risk, and Basic Indicator Approach (BIA) for operational risk. Assessment of capital
assess the adequacy of its adequacy is carried out in conjunction with the capital adequacy reporting to Bangladesh Bank. The
capital to support current Bank has maintained capital adequacy ratio at 12.83% & 12.83% on the basis of “Consolidated” and
and future activities. “Solo” respectively as against the minimum regulatory requirement of 10%. Tier-I capital adequacy
ratio under “Consolidated” basis is 9.25% and “Solo” basis is 9.25% as against the minimum regulatory
requirement of 5.00%. The Bank’s policy is to manage and maintain strong Capital Adequacy Ratio
through investing high rating grade investment clients. The Bank maintains adequate capital that is
sufficient to absorb all material risks associated with the Bank. The Bank also ensures that the levels
of capital comply with regulatory requirements and satisfy the external rating agencies and other all
stakeholders including depositors.

Particulars (In million Taka)
Solo Consolidated
b) Capital requirements for Investment (Credit) Risk: 33,670.14 33,616.60
c) Capital requirements for Market Risk 639.49 639.49
d) Capital requirements for Operational Risk 3,564.64 3,590.64
e) Total Capital Requirement 37,874.27 37,846.73
Capital Adequacy Ratio: 12.83% 12.83%
Total CAR
Tier- I CAR 9.25% 9.25%
Tier-II CAR 3.58% 3.58%
Investment (Credit) Risk
a) The General Qualitative disclosure requirement with respect to credit risk, including:
i) Definitions of past due and impaired (for - As per Bangladesh Bank guidelines, any Investment if not repaid within the fixed
accounting purposes): expiry date will be treated as Past Due/ Overdue.
Bangladesh Bank issued Circulars from time to time for strengthening Investment (Credit)
discipline and brings provisioning. All Investments/ loans & advances will be grouped into
four (4) categories for the purpose of classification, namely (a) Continuous Investment/
Loan (b) Demand Investment/Loan (c) Fixed Term Investment/Loan & (d) Short-term
Agricultural & Micro Investment.
The above Investment (Credit) are classified as follows:
Continuous and Demand Investment/ loan are classified as:
4 Sub-standard’ if it is past due/over due for 03 (three) months or beyond but less
than 06 months;
4 Doubtful’ if it is past due/over due for 06 (six) months or beyond but less than 09
(nine) months;
4 Bad/Loss’ if it is past due/over due for 09 months or beyond from the date
of expiry or claim by the bank or from the date of creation of forced loan/
Investment:
Fixed Term Investment (Loans), which are repayable by installment(s) are classified as: -
a. In case of any installment(s) or part of installment(s) of a Fixed Term Loan amounting
upto Tk.10.00 Lacs is not repaid within the due date, the amount of unpaid
installment(s) will be termed as ‘past due or over due installment’. In case of such
types of Fixed Term Loans/Investments:
4 ‘Sub-standard’ if the amount of ‘past due Installment is equal to or more than
the amount of installment(s) due within 06 (six) months, the entire Investment
(loan) will be classified as ‘’Sub-standard’’;
4 ‘Doubtful’ if the amount of past due installment is equal to or more than the
amount of installment(s) due within 09 (nine) months, the entire Investment
(loan) will be classified as ‘’Doubtful”;
4 ‘Bad/Loss’ if the amount of ‘defaulted installment’ is equal to or more than the
amount of installment(s) due within 12 (twelve) months, the entire Investment/
loan will be classified as ‘’Bad/Loss’’.
b. In case of any installment(s) or part of installment(s) of a Fixed Term Loan amounting
more than Tk.10.00 Lacs is not repaid within the due date, the amount of unpaid
installment(s) will be termed as ‘past due or over due installment’. In case of such
types of Fixed Term Loans/Investments:
4 ‘Sub-standard’ if the amount of ‘past due Installment is equal to or more than
the amount of installment(s) due within 03 (three) months, the entire Investment
(loan) will be classified as ‘’Sub-standard’’;
4 ‘Doubtful’ if the amount of past due installment is equal to or more than the
amount of installment(s) due within 06 (six) months, the entire Investment
(loan) will be classified as ‘’Doubtful”;

4 ‘Bad/Loss’ if the amount of ‘defaulted installment’ is equal to or more than the amount of
installment(s) due within 09 (nine) months, the entire Investment/loan will be classified as
‘’Bad/Loss’’.
Short-term Agricultural and Micro-Investment are classified as:
If not repaid within the due date as stipulated in the Investment (loan) agreement. If the said irregular
status continues, the Investment (credit) will be classified as ‘Substandard ‘ after a period of 12 months,
as ‘Doubtful’ after a period of 36 months and as ‘Bad/Loss’ after a period of 60 months from the
stipulated due date as per Investment (loan) agreement.
A continuous Investment, Demand or a Term Investment which will remain overdue for a period of 02
(two) months or more will be put into the Special Mention Account (SMA).
The Bank follows the specific and general provision for investment/ loan on the basis of Bangladesh
bank Guidelines issued from time to time.
ii) Description of approaches The rate of provision are given below:
followed for specific and a) General Provision: The Bank maintains General Provision in the following way :
general allowances and
statistical method; (1) @ 0.25% against all unclassified loans of Small and Medium Enterprise (SME) as defined
by the SME & Special Programmes Department of Bangladesh Bank from time to time and
@ 1% against all unclassified Investments (other than Investments/loans under Consumer
Financing, Loans to Brokerage House, Merchant Banks, Stock dealers etc., Special Mention
Account as well as SME Financing.)
(2) @ 5% on the unclassified amount for Consumer Financing whereas it has to be maintained
@ 2% on the unclassified amount for (i) Housing Finance and (ii) Investments/Loans for
Professionals to set up business under Consumer Financing Scheme.
(3) @ 2% on the unclassified amount for Investments/Loans to Brokerage House, Merchant
Banks, Stock dealers, etc.
(4) @ 5% on the outstanding amount of Investments/loans kept in the ‘Special Mention Account’
except SME Investment.
(5) @1% on the off-balance sheet exposures. (Provision will be on the total exposure and
amount of cash margin or value of eligible collateral will not be deducted while computing
Off-balance sheet exposure.)
b) Specific Provision: Banks will maintain provision at the following rates in respect of classified
Continuous, Demand and Fixed Term Investments/Loans:
(1) Sub-standard : 20%
(2) Doubtful : 50%
(3) Bad/Loss : 100%
c) Provision for Short-term Agricultural and Micro- Investments:
(1) Ùnclassified and SMA’ @2.50%
(2) ‘Sub-standard’ and `Doubtful’ @ 5%
iii) Discussion of the Bank’s (3) ‘Bad/Loss’ : 100%
Investment (Credit) Risk The Bank has put in place a well-structured Investment/Credit Risk Management Policy known as
Management Policy; Investment Risk Manual approved by the Board. The Policy document defines organization structure,
role and responsibilities and, the processes whereby the Investment (Credit) Risks carried by the Bank
can be identified, quantified and managed within the framework that the Bank considers consistent
with its mandate and risk tolerance.
Authorities are properly delegated ensuring check and balance in investment operation at every stage
i.e. screening, assessing risk, identification, management and mitigation of investment risk as well
as monitoring, supervision and recovery of investments with provision for Early Warning System and
Grading of Investment clients as Blue, Green, Grey, Yellow, Red and Brick Red.
Bank has framed Investment Policy, Investment (Credit) Assessment & Risk Grading, Approval Authority,
Internal Audit Approval Process, Investment (Credit) Administration, Investment (Credit) Monitoring,
Investment (Credit) Recovery etc. which forms integral part in monitoring of Investment (Credit) Risk in
the Bank. Status of investments is regularly reported to the Board /Executive Committee of the Bank.

a) Total gross Investment/ Total gross Investment/ Credit risk exposures broken down by major types of Investment exposure
Credit risk exposures of the Bank are as under:
broken down by major types
of Investment exposure. As on December
Particulars
31, 2014
(In million Taka)
Mode wise Investment
Bai – Murabaha 253,916.69
Bai - Muajjal 29,797.76
Hire Purchase under Shirkatul Melk 103,940.76
Bai-Murabaha Import Bills 5,861.48
Baim FC Bills 9,498.99
Musharaka 484.38
Mudaraba Investment 3,000.00
Bai – Salam 4,807.60
Murabaha Foreign Currency Investment 6,952.88
Quard 15,478.09
Investment in Khidmah Card 16.99
Overseas Investment (outside in Bangladesh) 2,338.48
Bills Purchased and Discounted 27,381.37
Total 463,475.47
b) Geographical Distribution Geographical Distribution of exposures, broken down in significant areas by major types of
of exposures, broken Investment/ credit exposure of the Bank are as under:
down in significant areas
by major types of credit As on December
Particulars
31, 2014
exposure.
(In million Taka)
In Rural Areas 23,737.35
In Urban Areas 437,399.64
Outside Bangladesh 2,338.48
Total 463.475.47
Division wise distribution of Investment/ credit exposure of the Bank are as under:
As on December
Name of Division
31, 2014
(In million Taka)
Dhaka Division 272,135.19
Chittagong Division 92,698.69
Khulna Division 29,491.57
Rajshahi Division 40,518.23
Barisal Division 6,194.63
Sylhet Division 9,364.33
Rangpur Division 13,072.83
Total 463,475.47

c) Industry or counterparty Industry or counterparty type distribution of exposures, broken down by major types of investment/
type distribution of credit exposure of the bank are as under:
exposures, broken
down by major types As on December
Particulars
of investment/ credit 31, 2014
exposure.
(In million Taka)
Economic purpose wise Investment
Trade & Commerce 129,544.05
Real Estate 37,680.39
Transport 6,435.45
Agriculture (including fertilizer & agriculture implements) 11,131.09
Industrial investment* 247,350.99
Others 31,333.50
Total 463,475.47
Industrial Investment
Textile- Spinning, Weaving & Dyeing 87,159.60
Steel, Re-Rolling & Engineering 17,068.46
Agro-based Industry 49,839.00
Garments & Garments Accessories 20,675.77
Food & Beverage 3,760.12
Cements Industry 3,598.51
Pharmaceuticals 2,885.13
Poultry, Poultry Feed & Hatchery 822.85
Sanitary Wares 49.10
Chemicals, Toiletries & Petroleum 7,812.66
Printing & Packaging 1,086.74
Power (Electricity) 5,056.58
Ceramic & Bricks 2,566.59
Health care ( Hospital & Others) 1,280.79
Plastic Industries 573.06
Petrol Pump & CNG Filling Station 468.97
Information Technology 394.48
Hotel & Restaurant 62.26
Other Industries 42,190.31
Total 247,350.99

d) Residual contractual Residual contractual maturity breakdown of the whole portfolio, broken down by major types of
maturity breakdown investment/credit exposure of the Bank.
of the whole portfolio,
broken down by major As on December
Particulars
31, 2014
types of investment/credit
exposure. (In million Taka)
Repayable on Demand -
Upto 1 month 64,378.77
Over 1 month but not more than 3 month 79,732.06
Over 3 months but not more than 1 year 108,961.95
Over 1 year but not more than 5 years 99,501.76
More than 5 years 110,900.93
Total 463,475.47
e) By major industry or i) Amount of impaired Investment/ loans and if available, past due investment/ loans provided
counterparty type separately
The amount of classified/ past due investment of the Bank is shown below:
As on December
Particulars
31, 2014
(In million Taka)
Past Due
Special Mention Account (SMA) 16,436.64
Sub Standard 2,235.22
Doubtful 1,513.00
Bad & loss 19,059.02
Total 39,234.88
ii) Specific and General Provision

Specific and General Provisions were made on the amount of classified and unclassified invest-
ments/ loans, Off- balance Sheet exposure of the bank according to Bangladesh Bank guidelines.
As on December
Particulars
31, 2014
(In million Taka)
Unclassified Investment 440,668.23
Classified Investment 22,807.24
Off Balance Sheet Exposure 112,819.23
Total 576,294.70
iii) Charges for specific allowances and charge - offs during the period
During the period the specific and general provision were made on the amount of classified in-
vestment, Unclassified Investment and Off Balance sheet exposures.
Particulars As on December
31, 2014
(In million Taka)
Provision on Unclassified Investment 253.88
Provision on Classified Investment 4,425.90*
Provision on Off Balance Sheet Exposure (9.00)
Total 4,670.78
* Provision for Classified investment includes provision made against subjective judgement

f) Gross Non Performing Assets i) Movement of Non Performing Assets (NPAs)

(NPAs)
31, 2014
(In million Taka)
Opening Balance 14,941.90
Additions 31,739.21
Reductions 23,873.87
Closing Balance 22,807.24
ii) Movement of specific provisions for NPAs
31, 2014
(In million Taka)
Opening Balance 9,037.80
Recovery amount previously written off 39.35
Provisions made during the period 4,425.90
Fully provided Investment written off (148.34)
Closing Balance 13,354.72
* Provision made during the period includes provision made against subjective judgement
Equities: Disclosures for Banking Book Positions

Qualitative disclosures
a) The general qualitative disclosures requirement with respect to equity risk, including:
• Differentiation between holdings on Investment in equity securities are broadly categorized into two parts:
which capital gains are expected
and those taken under other i) Quoted Securities (common or preference share & mutual fund) that are traded in the
objectives including for relationship secondary market (Trading Book Assets).
and strategic reasons; and ii) Unquoted securities are categorized as banking book equity exposures which are
further sub-divided into two groups: unquoted securities which are invested without any
expectation that these will be quoted in near future i.e. held to maturity (HTM). And
securities those are acquired under private placement or IPO and are going to be traded
in the secondary market after completing required formalities. Unquoted securities are
valued at cost.
• Discussion of important policies The primary objective is to investment in equity securities for the purpose of capital gain
covering the valuation and by selling them in future or held for dividend income. Dividends received from these equity
accounting of equity holdings in securities are accounted for as and when received and right to receive when established.
the banking book. This includes Both Quoted and Un-Quoted equity securities are valued at cost and necessary provisions are
the accounting techniques and maintained if the prices fall below the cost price.
valuation methodologies used,
including key assumptions and As per Bangladesh Bank guidelines, the HFT equity securities are revaluated once in each
practices affecting valuation as week using marking to market concept and HTM equity securities are amortized once a year
well as significant changes in these according to Bangladesh bank guideline.
practices. The HTM equity securities are also revaluated if any, are reclassified to HFT category with the
approval of Board of Directors.

As on December 31, 2014 (In million Taka)
Particulars Solo Consolidated
a) Value disclosed in the balance sheet of investments, as well as the fair value of those 101.50 101.50
investments, for quoted securities a comparison to publicly quoted share values where the
share price is materially different from fair value.
b) The cumulative realized gains (losses) arising from sales and liquidations in the reporting - -
period.
c) Total unrealized gains (losses). 81.50 81.50
d) Total latent revaluation gains (losses) - -
Any amounts of the above included in Tier – 2 capital. - -

e) Capital requirements broken down by appropriate equity groupings, consistent with the bank’s methodology, as well as the
aggregate amounts and the type of equity investments subject to any supervisory provisions regarding regulatory capital
requirements.
• Specific Market Risk 10.15 10.15
• General Market Risk 10.15 10.15
Profit Rate Risk in the Banking Book

a) The general qualitative disclosure Profit rate risk is the risk where changes in market profit rates might adversely affect bank’s financial
requirement including the nature condition. Changes in profit rates affect both the current earnings (earnings perspective) as well as
of Profit Rate Risk in the Banking the net worth of the bank (economic value perspective). Re-pricing risk is often the most apparent
Book (PRRBB) and key assumptions, source of profit rate risk for a bank and is often gauged by comparing the volume of a bank’s assets
including assumptions regarding that mature or re-price within a given time period with the volume of liabilities that do so.
investment prepayments and The short term impact of changes in profit rates is on the bank’s Net Investment Income (NII). In a
behavior of non-maturity deposits, and longer term, changes in profit rates impact the cash flows on the assets, liabilities and off-balance
frequency of PRRBB measurement. sheet items, giving rise to a risk to the net worth of the bank arising out of all re-pricing mismatches
and other profit rate sensitive position.
b) The increase Over 3 Over 6
Over 9 Months
(decline) in earnings Particulars 1-90 days Months to 6 Months to 9
to 12 Months
or economic Months Months
value (or relevant Rate Sensitive Assets 110,619.68 61,780.38 76,192.23 77,087.72
measure used
Rate Sensitive Liabilities 105,740.27 60,812.00 75,306.78 76,685.80
by management)
for upward and GAP 4,879.40 968.37 885.45 401.92
downward rate Cumulative Gap 4,879.40 5,847.78 6,733.22 7,135.15
shocks according Adjusted profit rate changes (PRC) 1% 1% 1% 1%
to management’s
method for Quarterly earnings impact (Cum. Gap*PRC) 1,219.85 1,461.94 1,683.31 1,783.79
measuring PRRBB, Accumulate earning impact to date 1219.85 2,681.79 4,365.10 6,148.89
broken down
by currency (as
relevant)

Market Risk
a) i) Views of BOD on trading / The Board approves all policies related to market risk, sets limits and reviews compliance on a regular
investment activities basis. The objective is to provide cost effective funding to finance asset growth and trade related
transactions.
ii) Methods used to measure Standardized rule based approach has been used to measure the Market risk. The total capital requirement
Market risk in respect of market risk is the aggregate capital requirement calculated for each of the risk sub-categories.
For each risk category minimum capital requirement is measured in terms of two separately calculated
capital charges for “specific risk” and “general market risk”.
The Treasury Division manages market risk covering liquidity, profit rate and foreign exchange risks with
iii) Market Risk Management oversight from Asset-Liability Management Committee (ALCO) comprising senior executives of the Bank.
system ALCO is chaired by the Managing Director. ALCO meets at least once in a month.
There are approved limits for investment deposit ratio, liquid assets to total assets ratio, maturity
mismatch, commitments for both on-balance sheet and off-balance sheet items and borrowing from
iv) Policies and processes for money market and foreign exchange position. The limits are monitored and enforced on a regular basis to
mitigating market risk protect the market risks. The exchange rate of the Bank is monitored regularly and the prevailing market
condition, exchange rate, foreign exchange position and transactions are reviewed to mitigate foreign
exchange risks.
Solo Consolidated
b) The Capital Requirements for
Profit (Interest) rate risk -
Equity position risk 20.30 20.30
Foreign exchange risk 619.19 619.19
Commodity risk. - -
Total Capital Requirement 639.49 639.49
Operational Risk
a) i) Views of BoD on system to reduce Operational risk is the risk of loss or harm resulting from inadequate or failure of internal processes, people
Operational Risk and systems or from external events. Capability to carry out a large number of transactions effectively and
accurately while complying with applicable laws and regulations constitutes operational risk management
activities of the bank.
The policy for operational risks including internal control & compliance risk is approved by the Board taking
into account relevant guidelines of Bangladesh Bank. Audit Committee of the Board directly oversees the
activities of Internal Control & Compliance to protect against all operational risk.
ii) Performance gap of executives and IBBL has a policy to provide competitive package and best working environment to attract and retain
staffs the most talented people available in the industry. IBBL’s strong brand image plays an important role in
employee motivation. As a result, there is no significant performance gap.
iii) Potential external events - No potential external events are expected to expose the Bank to significant operational risk.

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

(In million Taka)
Capital Requirement Solo Consolidated
Operational Risk 3,564.64 3,590.64
Stress Testing
Bangladesh Bank through their DOS Circular No. 01 dated 21.04.2010 and subsequent DOS Circular No. 01 dated 23.02.2012 introduced “Guidelines on
Stress Testing” wherein Stress Testing has been stated as one of the sophisticated technique that is used to determine the reactions of different financial
institutions under a set of exceptional, but plausible assumptions through a series of battery of tests. At institutional level, stress testing techniques provide
a way to quantify the impact of changes in a number of risk factors on the assets and liabilities portfolio of the institution.
Bangladesh Bank also mentioned in the said circular that at the system level, stress tests are primarily designed to quantify the impact of possible changes
in economic environment on the financial system. These tests help the regulators identify structural vulnerabilities and the overall risk exposure that could
cause disruption of financial markets.
Bangladesh Bank Circular No. 01 dated 23.02.2012 introduced “Guidelines on Stress Testing” wherein advised that “Banks shall carry out stress testing in
line with the revised guideline on quarterly basis i.e. on March 31, June 30, September 30 and December 31 and submitted the same to Bangladesh
Bank within 30 days of each quarter end”.
IBBL has already prepared a stress testing report in line with the Bangladesh Bank’s guidelines which initially focus on “Simple Sensitivity and Scenario
Analysis” of the following five risk factors.
• Profit/ Interest rate;
• Forced sale value of collateral;
• Non- performing Investments (NPIs);
• Equity/Share prices ; and
• Foreign Exchange rate
The result of stress testing based on the financial performance of the bank as on December 31, 2013 has also been completed which shows that the bank
has adequate capital to absorb minor and moderate individual shocks. However, some additional capital may be required under major level combined shocks,
which is most unlikely.

ICT & Automation
IBBL has always been a front-runner in using new secure database management system, ORACLE. All banking
technologies and innovative services to make banking modules have been fully integrated in eIBS including three
easier & simpler. In addition, it has taken Initiatives to major modules: General Banking (GB), Investment, and
make the Bank totally IT driven and targeted to achieve full Foreign Exchange. Each module is running at all branches
automation. The Bank has established online connectivity to and integrated with each other.
its all branches having dual connectivity at all major and city
An advanced version of RDS/UPDS module of eIBS has also
branches, which is the largest network amongst all Banks in
been developed by Bank’s own manpower and implemented
Bangladesh. IBBL’s data center is the largest in the Banking
in all RDS branches of the Bank.
sector of the country. Establishment of own ATM network of
the Bank and introduction of different cards like, salary card, Any Branch Banking
travel card, VISA debit card, Remittance Card and Khidmah
Credit Card and existing ATM (debit) Card make the services Presently IBBL possesses the largest online banking network
of the Bank more attractive to the customer. All types of in the country. All branches are under on-line connectivity via
Electronic Fund Transfer (EFT) and Alternative Payment dual connectivity using Fiber Optics and Radio Link where
Systems i.e. ATM, POS, SMS and Internet Banking, mobile “Any Branch Banking” facilities to the clients are being
banking, phone banking are already incorporated in the long provided. Both the revenue and number of transactions of
list of services of the Bank. Some services like payment online banking of IBBL have showed positive growth over the
gateway, POS (Point of Sale) are in the waiting list, which past year. More than 1,00,000 transactions per day are being
will be incorporated into our services very soon. All Branches performed with volume of approx. Tk. 1000 cores using on
including SME/Krishi Branches of IBBL are equipped with line remote deposits and withdrawals. About two core ten
state of the art IT components used in the Banking sector. lacs transactions have been performed by IBBL any branch
banking module in 2014.
eIBS (Electronic Integrated Banking System) Equipping IBBL workforce
IBBL boasts to be the only Bank in Bangladesh possessing We have achieved the vision of ‘one man one computer’
own developed Centralized Core Banking System, eIBS, for all employees. For now, all working forces (AOG-III and
which is based on open source technologies and most above) of the Bank are availing computer. We have already

ICT & Automation
set up more than seven hundred IP Phones and twenty-five if any account transacts BDT Fifty thousand or above, an
Video Phones. We will provide more than five hundred IP SMS is sent to clients registered mobile via IBBL SMS PUSH
Phones in next year. We have already provided email and services. Through SMS push-pull service, clients can see
internet facility to most of the officials and executives. We their latest balance information and last three transactions
have plan for providing Email and internet facility for the rest in their mobiles from anywhere in the world at any time by
of officers gradually. Last year we organized more than fifty sending SMS to 6969 (for local clients) +8801714006969
IT related training and workshop for the employee of IBBL (for international clients). More than 2.15 million clients have
where more than three thousand employees were attended. been registered in SMS Banking and on an average 22,000
requests are being received per day. About 7.5 million SMS
ATM and Card Services push pull notification have been processed by IBBL SMS
system in the year 2014.
From 2001, IBBL started providing ATM service to its
customers from 55 branches through a consortium of Through iBanking, valued clients of IBBL and Foreign
9 financial organizations using a 3rd party ATM service Remittance exchange Houses can check account details
provider and from 2009 the Bank has been operating its own at IBBL’s Web Portal. So far, nearly 0.15 million clients have
ATM network which has increased to 450 ATM booths at the registered for taking the facility. IBBL iBanking clients can
year end 2014. transfer up to 0.5 million taka daily from one account to
other accounts of any branches of IBBL by himself without
Now more than 1,710,000 of our existing ATM cardholders any interaction of bank. IBBL clients can also enjoy mobile
can use IBBL’s own 450 ATMs and 4000 shared ATMs. More top up services, post paid bill payments, utility bill payment
than 15.5 million transactions have been performed by IBBL etc. by iBanking services. About 16.5 lac transactions
own ATM in 2014. IBBL has already joined in NPSB (National amounting to Tk.1360 crore are handled by IBBL iBanking
Payment system Bangladesh) networks of Bangladesh system in the year 2014. IBBL online Money transfer system
Bank through which IBBL customers make transaction at all is being used by the exchange houses for sending spot/
bank’s ATM booths under NPSB. instant cash and direct IBBL customer account credited
from abroad. IBBL employees use this for payout the spot/
We have already joined with VISA also, world’s largest retail
instant cash. About 18 lac transaction amounting Tk.5700
electronic payment network, as a principal member. Shari’ah
crore is handled by IBBL online money transfer system in
based Khidmah Credit Card, Prepaid Card, Travel Card,
the year 2014. At present more than 100 exchange houses
Salary Card, Hajj Card and Remittance Card services are in
are directly connected with the system IBBL online money
live operation. Customers can now perform full or partial
transfer system.
withdrawal of their foreign remittance amount either from
IBBL ATMs or branches using the Remittance Card. It paved Management Information System (MIS)
the way for making our cards usable at any global outlets
(ATMs and/or POS). IBBL has built a strong Central MIS for the Bank. It now
contains any Branch Level, Zone Level, Central Level data
The other deliverables of the projects are POS (Point of Sale), and information and also contains information of ATM,
EMV (Euro pay, Master Card and Visa, a global standard for iBanking, SMS Banking, Mobile Banking and External
inter-operation of integrated circuit cards) which are in the Market. Thus IBBL Management can observe the business
pipeline of the operation. trend, growth and performance of the bank and can get any
business analytics at any moment from the Central MIS
On-line Data Centre (DC) and Disaster Recovery (DR) Site
which enabled us to provide current information to different
IBBL has the country’s largest Data Centre in the Banking external bodies like Ministries, Bangladesh Bank, World
sector running on ORACLE EXA data solution in DC, HOT DR Bank, IFC, IMF, and ADB etc.
& DR site. IBBL has also completed setting up of Disaster
IBBL also built a strong Branch MIS like GBMIS, INVMIS,
Recovery Site (DRS) as per the guideline of Bangladesh Bank
FEXMIS for the branches which contains Branch Accounts,
as a replication of our existing Data Center. Full-fledged
Daily Transactions, Remittances, General Ledger (GL)
operations of the DRS are now going on.
related information for monitoring of Branch Incumbent as
SMS Banking, iBanking and online money transfer service well as branch users.
The Bank has already started SMS Banking, Internet Banking

(iBanking) & Spot Cash Services. Through SMS push service,
BACH (Bangladesh Automated Clearing House)
remitters and beneficiaries of the Foreign Remittance can Clearing of instruments on the same day is now being
automatically receive a message in their mobile phones possible due to implementation of BACH. IBBL uses in-
once the amount is credited in their accounts. From the teller house developed software for this purpose. About 25 lac

ICT & Automation
inward and outward clearing instruments Tk.88,320 crore can enjoy the mCash services more than thirty-five IBBL
have been cleared by IBBL BACPS system during the year appointed agent outlet and 61000 agent of mobiCash all
2014. over the country. We have target to expand this network up
to fifty thousand with in 2015.
BEFTN (Bangladesh Electronic Fund Transfer Network)
Centralization of the Core Banking System (CBS)
IBBL has been one of the few banks to develop own
BEFTN system. As per guidelines of Bangladesh Bank, Our ultimate goal is to centralize the CBS (eIBS) and its
IBBL customers are able to offer electronic fund transfers associated systems so that all services and supports can be
to and from third bank via BEFTN system in addition provided from a single operational point. Implementation of
to its conventional banking channels. About 1.5 million BACH, BEFTN, Call Center etc. are all part of the centralization
transactions amounting Tk.7,663 crore have been handled approach. And once done, they all will ensure services on
by our EFT system during the year 2014. fast track and will enable to deliver more innovative ones
in electronic and alternate delivery channels (Cards, SMS
Establishment of IBBL Contact Center Banking, iBanking, Mobile Banking, etc.). By this time, two
hundred and thirty eight branches are migrated to the
IBBL has established a Contact Center to provide smart,
centralized environment. Centralization of IBBL branches
appropriate, state of the art support services to the clients,
will improve the customer services tremendously and will
Branches, and Head Office simultaneously. Dialing 16259
reduce the operating cost and ensure more security and
or from abroad (+880)-2-8331090 anyone can enjoy IBBL
regulatory compliances.
phone banking or agent base services round the clock. On
an average around 3500 calls hit on IVR and nearly 1500 Call IBBL website
are handled by the Contact Center Agents per day. Till now
about 0.6 million callers availed agents support from IBBL The website of IBBL (http://islamibankbd.com) has
Contact Center from 1st January 2013. become more dynamic, informative, and secured. Updated
Information related to IBBL and Islami banking (public
Mobile Banking Services (mCash) information) is now available at our website.
IBBL has implemented full scale mobile banking services Green Banking
(mCash) like cash in/out fund transfer, mobile airtime
recharge, utility bills payment, salary and tuition fee payment IBBL has taken initiative to migrate to full-fledged Green
etc. to its customers. Through it, IBBL intends to bring a banking operation within December 2015. To achieve
revolution in banking trends and to bring the un-banked the milestone of green banking, we have started the re-
population under the umbrella of Islamic Banking. IBBL engineering process in our system and mode of operation.
mCash system is integrated with ROBI, BanglaLink, AirTel
and Grameen Phone Mobile network. By this time, customer

Green Banking
Effluent Treatment Plant (ETP) of a project financed by the Bank
Green Banking is an emerging issue in the present banking IBBL is always enthusiastic in participating and arranging
arena. It is a kind of welfare banking for the society. IBBL various programs on green banking and environmental
being a Shari’ah compliant welfare bank, emphasizes issues. IBBL, as a recognition of its better Green Banking
on human rights, green investments and trade, social practices, was selected for presenting a paper for the
involvement, ecological impact and animal welfare etc. and seminar on “Green Banking: Opportunities & Initiatives
takes various initiatives and steps for performing Green
in Bangladesh” held on 23 January 2014 organized by
Banking activities.
Bangladesh Bank Training Academy (BBTA). IBBL was also
IBBL ranked among top ten banks in Bangladesh for Green designated as discussant for the seminar on “Green Banking
Banking Activities as published in the Annual Report on & Environmental Risk Management” held on 21st August
Green Banking 2012 by Bangladesh Bank. IBBL was also 2014 organized by BBTA.
ranked as 1st in Climate Risk Fund Utilization activities
among all banks.
Green Budget & its Utilization

The Budget for Green Banking reflects the Bank’s commitment towards the Green Banking. In 2014, the Green Investment got
highest allocation. All the main areas of Green Banking Budget 2014 and utilization thereof are below:
(In million Taka)

Green Banking
Green Investment environment friendly investments like renewable energy,

energy efficiency, waste management, alternative energy,
Green Investments implies the financial services to the recycling & recyclable product, green industry, safety and
businesses and projects that help prevent deterioration security of factory, clean water supply etc. Some of these
of the environment as well as which are not harmful to green investments of 2014 of the Bank are given below:
the environment. The Bank gives priority in disbursing the
Green Investments in 2014
Disbursement in 2014 Disbursement in 2013 Growth/decrease (%)

Particulars of Green Investments Amount in Amount in Amount in
Number Number Number
million Tk. million Tk. million
Projects financed having ETP 219 48,352.51 192 39,677.00 14.06% 21.87%
Bio-gas plant 9 0.89 9 7.00 0% -87.29%
Solar Home System & Solar Panel trades 18 131.08 17 117.78 5.88% 11.29%
Bio-fertilizer plant 2 0.20 3 2.00 -33.33% -90%
Projects financed having Tunnel Kiln 22 632.87 8 761.00 175% -16.84%
Installation of Zigzag kiln 31 125.97 28 126.90 10.71% -.79%
Projects financed having Zigzag kiln 455 2,170.64 149 1,382.00 205.37% 57.07%
Waste and hazardous disposal plant 6 2,001.77 2 500.00 200% 300.35%
Waste paper recycling plant 12 394.64 9 981.00 33.33% -59.77%
Waste battery recycling plant 11 510.46 9 198.00 22.22% 157.81%
PET bottle recycling plant 12 370.05 5 419.00 140% -11.68%
Financing of LED bulb production 3 29.16 2 75.00 50% -61.12%
Safe/Clean Water Supply Projects 14 4.12 3 4.00 366.67% 3%
Improved cooking stove (Bandhu Chula) 6 1.50 4 0.06 50% 2400%
Green finance at zero rate of return 3,930 21.96 3087 15.27 27.31% 43.81%
Electricity Generation from Rice Husk 1 176.34 1 111.35 0% 58.37%
Rice bran Oil Production 2 441.07 2 373.86 0% 17.98%
Total 4,835 55,368.53 3,530 44,751.22 36.97% 23.73%

Green Banking
Plantation by IBBL
Environmental Risk Management

The Bank has incorporated Environmental and Climate
Change Risk Management as a part of the existing
investment risk assessment methodology integrating
environmental risks in the checklists, audit guidelines and
reporting formats. High Environmental Risk Rated (EnvRR)
investment proposals are approved only by the Board
stipulating appropriate covenant. The total number of
projects/exposures applicable for EnvRR in 2014 was 2,257.
Rehabilitation Support
Particulars Low Moderate High Total
The Bank donated Tk. 10 million to the Prime Minister’s
No. of
exposures/
Relief Fund to help and rehabilitate the flood and river
investments 1503 456 72 2031 erosion affected people of the country in 2014. The Bank
rated also directly donated Tk. 35.31 million as the relief work for
flood affected people. The Bank also donated blanket worth
Amount Tk. 57.26 million among the severe cold-hit poor people.
disbursed
against rated 88,024.79 25,878.15 15,043.92 128,946.86 Investment Activities without any Return
exposures (In To improve the standard of living of the rural people, IBBL
million Taka)
finances the setting up of tube wells and sanitary latrines in
the rural areas without charging any rate of return against
Climate Risk Fund the investments. The Bank has foregone Tk.3.93 million for
improving the living standard of poor people during 2014.
The Climate Risk Fund policies of the Bank support projects, The summary of the welfare activities are given below:
programs, and economic activities in the flood, cyclone,
drought, severe cold etc prone areas of the country as a Particulars Number of Amount in million
part of the CSR expenses. Total expenses in the climate risk Units Tk.
related avenues were Tk.125.10 million in 2014. Projects and
other activities which came under the Fund in 2014 are given Tube well 3495 19.50
below: Sanitary Latrine 1493 6.60

Green Banking
Tree Plantation Movement 3. The Bank emphasizes selling products and/or services
based on their environmental benefits. A number of such
The Bank has been observing Plantation Program since
products and services like ATM debit card, Visa Debit
2003 in the rainy season under Rural Development Scheme
Card, M-cash, i-banking, i-recharge, Remittance card,
to conserve the environment. In 2014, the Bank distributed
SWIFT, Call center, Online banking, SMS banking etc
723,672 saplings of indigenous fruit varieties among 0.82
are being promoted through vigorous advertisement
million RDS members costing TK. 20.53 million against
in both the electronic and the print media. The Green
Tk.14.56 million in 2013.
marketing expenditure of the Bank was Tk. 18.00 million
for the year 2014.
Investments in the Disaster Prone Areas
IBBL contributes a significant portion (27.49%) of its Green Training and Awareness Programs
investment portfolio in the disaster prone areas of the The Bank emphasized the training and awareness programs
country. These areas are mostly less developed and needs on green banking to ensure the reduction of carbon emission
based investments, which IBBL takes as its one of the from its operational activities. The Bank arranged Green
priorities to support the economic activities of the regions. Banking Training Programs in Dhaka and 13 (thirteen) Zones
In case of any emergency, the Bank utilizes its Climate Risk to revamp the Green Banking practices. Besides, officials
Fund as part of its CSR to continue the economic activities. of the Bank attended the Training programs/workshop/
The amounts of investments in the economic activities of 32 seminars on Green Banking issues arranged by Bangladesh
districts during 2014 are presented in the chart: Bank Training Academy and BIBM this year. Green Banking
Training performance in 2014 are mentioned below:
Training and Awareness programs on Green Banking
1 Number of courses/training 288

conducted
2 Participants of employee training 7405
programs
3 Participants of customer awareness 3771
programs
4 Expenditure (Million Taka) 2.91
Automation
The Bank has huge number of products like deposits,
Green Marketing investment, IBW and other services products which are
automated and time savings for the customers. Advanced
Our Green Marketing and Products initiatives are: technologies are being used to provide prompt and
environment friendly customer services.
1. Customers can get instant registration for i-Banking
(Internet Banking): i-Banking is designed to implement Various continuous processes have been there to minimize
our commitment to green banking and to enable the banks direct operational impact to environment in
customers to do banking at their own convenience Bangladesh:
without visiting the branches. Our i-Banking facility 1. Soft archival of customer documents for electronic
allows the customer to bank from anywhere, anytime access and retrieval is enabling us to reduce
with total security and confidentiality. This is an consumption of paper;
absolutely free of service cost. 2. Majority of internal memos, process notes and records
2. Bank is increasingly focusing on online platforms like are in electronic form;
Face book, Websites etc. for promotional activities. All 3. Internal communications are done through emails.
our offers, promotions, news are available on websites Most of the staff have dedicated email IDs for office use;
that reduce the dependency on print media. All these 4. Customer communications are being done through
Digital initiatives are reducing carbon footprints on day- emails, SMS or ATM display instead of letter
to-day communication activities. communication(except for regulatory requirements);

Green Banking
5. Video conferencing with offices has reduced the need Paper Consumption
for physical travel with associated carbon emission;
Paper consumption in the offices is managed such a way
6. Most of Foreign Trade Services of the Bank are handled that contributes saving of paper in the daily operations of
through Centralized Trade Processing. Besides, all the Bank. Use of scrap/one side used papers for note pad
circulars, notices, memoranda and queries are issued has become usual practice to the employees. One side used
through Intranet. Employment notices are given on papers are also used in the printing for draft copies of the
website and online applications are invited & entertained; office assignments.
7. The Centralized Investment Proposal Processing System
of the Bank has been introduced for efficient and prompt Renewable Energy
disposal of the investment proposals and to make the
whole process of investment system more transparent The Bank installed Solar panels at Head Office, 32 Branches
which is running as a Pilot Project. as a part of its commitment to the usage of renewable
energy resources.
In-house Environmental Management
The Bank practices In-house management of its offices Green Travel
giving utmost importance to the environment. The Bank has IBBL always encourages the officials to undertake Green
made it a regular practice to follow the Green Office Guide travel for any business travel, which reduce environmental
of the Bank in its day-to-day office operations to minimize impact. In this regard bank use hybrid autos, use public
and reduce carbon emissions, achieve more efficient use of transport and car-pooling system.
resources and reduction of waste, save energy and money,
and help improve our working environment. The followings Ethical Banking
are some of its outcomes:
The Bank aims to run in such a way that it doesn’t have any
Waste Management negative impact on either society or the environment. The
principles of the Bank have direct impact on how it invests
Waste minimization through demand management, reuse and utilizes its resources. It does not finance enterprises that
and recycling are the preferred methods of reducing solid deal in morally questionable businesses. The Bank attempts
waste. Wooden door, ceiling fan, air cooler, generator, to maximize social welfare, reduce hazards, protect the
aluminum fixed partition, switch/socket, cable, electric tube, nature and any type of degradation in its operational areas
swing door, server room, battery, water filter, table glass, and activities. Moreover, the Bank’s core principle is the
cheque writer, trunk, signboard, table, tube light shed, chair, protection of resources for the future generation.
type writer, computer, calculator, exhaust fan, circuit breaker,
LAN cable, sofa are some of the e-waste and other solid Management Approach
waste items of the Bank which are collected from every
operational unit and disposed centrally through e-tendering The Bank recognizes the environmental hazards caused
that are environmentally friendly and safe. The Bank earned by consumption of resources and release of waste from
Tk. 1.14 million and Tk. 1.76 million in 2014 and 2013 own business activities and aim to protect the environment
respectively by selling its e-waste and other wastes. through resource recycling as well as efficient use of energy
and resources. We are committed to continually minimize
Energy Management our operational environmental impacts, by monitoring
environmental performance; setting improvement targets; and
The Bank advises the officials to adopt energy efficient
by implementing and evaluating environmental management
practices. The offices try to ensure efficient use of gas, fuel
program that save energy and water, manage waste,
and electricity with a view to reduce carbon emission. Energy
recycle materials, reduce business trips, and promote green
efficient equipments like energy bulbs, less sound generators
procurement and provide wide range of e-banking services.
etc are used in the offices. The Bank also introduced the
system of auto shutdown of electrical equipments.
The Bank adopts processes to assess the environmental
Water Management and social risks and opportunities arising from its client’s
The Bank encourages its staff and officers to practice business activities and manages the Bank’s exposure
austerity in using water and also does large borrowers to to reduce its own carbon foot print on the environment
conserve & recycle water. The Bank used Tk. 10.35 million in according to Environmental Conservation Rules (ECR) 1997
2013 and Tk. 12.32 million in 2014 for the consumption of and Environmental Risk Management (ERM) Guidelines of
water in the offices. Bangladesh Bank.

CSR Report
Prime Minister hands over IBBL cheques to the families of the martyred Army officers
As a responsible corporate citizen and one of the biggest creation of ``Sadaqah Tahbil``. Thereafter, it was done
Islamic Bank of the world, we believe that Islami Bank through IBF converting the Sadaqah Tahbil into a full fledged
Bangladesh Limited (IBBL) has a responsibility to our foundation since May 20, 1991. Further to its activities under
stakeholders as well as to the communities in which we IBF, IBBL established Corporate Social Affairs Department
work and live. Our commitment is built on a deeply ingrained (CSAD) under Operations Wing on in 2009 in compliance
sense of social responsibility among our stakeholders, with the instruction of the Central Bank.
employees, customers alike and that we grow stronger by
serving the communities, improving business practices and The Triple Bottom Line
individual lives around us.
The CSR program of IBBL aims at the welfare and well-
Why CSR? being of the people of the earth, the planet itself and all its
stakeholders. Keeping that in view triple bottom line has
CSR is seen as a concept in which companies voluntarily been introduced i.e. People, Planet and Profit. The purpose
integrate social and environmental concerns into their of this Corporate Social Responsibility Report (CSR) is to
business operations and into the interaction with their provide an account in a single document of IBBL’s overall
stakeholders. As a matter of fact, over the last few decades, contribution to sustainable development.
corporations in the developed economics have moved
to ‘Social Responsibility Approach’ from classical ‘Profit People
Maximizing Approach’ where businesses are not only
responsible to its stakeholders but also to the society as We try to increase the welfare of our employees and the
a whole in a broader inclusive sense. The idea of being a communities in which we live and work.
socially responsible company means doing more than
complying with the legal and regulatory requirements. Our Commitment to Employees
CSR is the built in mechanism of IBBL Our people are our capital- no matter what their title or job
function. We strive to make IBBL a great place to work and
In order to popularize the concept of Islamic Banking, IBBL build a career. Our employees describe the workplace as
has started its charitable activities since inception through collaborative and collegial, where the views of all employees

CSR Report
State Minister for Youth and Sports hands over medal to Bangladeshi Players at Islami Bank Asian Games qualifiying Hockey Tournament 2014
are taken into consideration. We possesses value-driven superannuation period. Under the policies, ‘Contributory
culture, where good ideas are recognized regardless of the Provident Fund’, ‘Superannuation Fund’, Benevolent Fund
level of the employees. and ‘Gratuity Fund’ have been developed.
Comprehensive Training and Development Shapes Human Rights

Our Success
The Bank is very much conscious about human rights at
To develop professional knowledge, skill and attitude of the every level of its operations. We do not employ workers
employees, the Bank established its own training academy under the legal minimum age, prohibit the use of forced
‘Islami Bank Training & Research Academy (IBTRA)’ where labour, respect employees rights to join or not to join a
training courses are conducted round the year. Employees labour union, respect the principles of collective bargaining,
are encouraged to complete ‘Diploma in Islamic Banking’ provide healthy & safe work place. The Bank does not make
from IBTRA and ‘JAIBB & DAIBB’ from Institute of Bankers any discrimination on the basis of age, gender, race or socio-
Bangladesh by allocating points for both the diploma in economic background. It limits work to standard accepted
promotion criteria. Besides, each of the employees is given hours and denounces any sort of abuse of its workforce
cash incentive for completing diplomas. Besides IBBL has whatsoever.
largest CDCS (more than half of total CDCS of the country)
in the country which makes the Bank a world valued Bank. Our Commitment to Communities
Remuneration and Benefits IBBL is committed to being a responsible corporate citizen.

We make grants and support volunteerism in all our
The Bank has developed a comprehensive pay-scale for communities around the country. We take several initiatives
the employees, the ratio of the highest and lowest level in in individual and organizational level for development of
the pay-scale has been maintained at 12:1 (DMD:MCG). the community especially the less fortunate segments of
To meet the housing need and to ensure comfortable life, the community. We support: (1) Education, (2) Health, (3)
employees are provided with investment at a discounted Humanitarian & Disaster Relief and (4) Sports, arts & culture.
rate under SHBIS and SHDS. The executives of the Bank are
provided with car either from bank management or under An amount of Tk. 3526.68 million for 12,331,399 beneficiaries
“Car Scheme for the Employees of the Bank”. was spent by IBBL from 1983- 2014 in these areas. Out of
which Tk. 524.52 million for 1,355,521 beneficiaries was
Apart from regular pay packages, IBBL has policies contributed in 2014.
for its employees to make their life secured during the

CSR Report
Donation to Jalalabad Education Trust
Sector wise CSR expenditure (1983-2014)

(In million Taka)
1983-2011 2012 2013 2014 Total
Sector Amount No. of Amount No. of Amount No. of Ben- Amount No. of Amount No. of Ben-
Beneficia- Beneficia- eficiaries Beneficia- eficiaries
ries ries ries
Education 409.31 492,909 83.8 3014 135.26 7,756 161.34 7928 789.71 511,607
Health 963.51 6,905,197 39.75 19,230 71.50 95,255 89.47 125079 1164.23 7,144,761
Human-
itarian &
303.46 643,979 87.93 597866 140.10 254078 190.16 498768 721.65 1,994,691
Disaster
Relief
Sports 321.58 414,260 1.61 144 78.97 7 40.2 5 442.36 414,416
Arts &
87.12 229,714 8.24 11 5.86 21 15.21 17 116.43 229,763
Culture
Environ-
7.84 15,243 12.48 493,822 22.94 592722 21.12 723673 64.38 1,825,460
ment
Others 123.73 175,444 75.38 34438 21.79 768 7.02 51 227.92 210,701
Total 2,216.55 8,876,746 309.19 1,148,525 476.42 950,607 524.52 1,355,521 3526.68 12,331,399
Education securing GPA 5 in SSC & HSC examinations under its direct
Scholarship program. The Scholarship is provided to the
From the very beginning, IBBL engaged with promotion of
students @ Tk. 1,000/- & Tk. 1,500/- per month for 2 years &
education sector of the country. IBBL spent an amount of
3 to 5 years for HSC & Graduation level respectively.
Tk. 789.71 million for 511,607 beneficiaries from 1983-2014
for this purpose. In addition, scholarship is allowed to 400 meritorious but
poor students in different educational institutions.
Scholarship Program
Support to the Research Organizations
Every year IBBL has been providing scholarship to the very
poor 800 students (400 in HSC and 400 in Graduation level) As part of facilitating research, IBBL has extended support

CSR Report
Prime Minister receives a cheque of Tk. 3 Crore from Engr. Mustafa Anwar, Vice Chairman for organizing ICC T-20 Cricket World Cup
for establishment of a Committee for Action Research and Midwifery Training Program also operated by IBBL for
Extension Services (CARES), a biotechnological research developing health sector of the country.
organization, 1st of its kind in Bangladesh under the leadership
of globally recognized scientist Dr. M. A. Mazid Khan for
Humanitarian and Disaster Relief
action research on biotechnology utilizing the expertise of Disasters can strike anywhere. No country, rich or poor, is
Bangladeshi researchers both at home and abroad. immune from risks of accidents and disasters causing
deaths and injuries, destruction and damage to properties
Support to the disable children
and assets; disrupting economic activities and livelihoods of
‘PROYASH’ is an institute run under the patronization of individuals and households.
Bangladesh Army for the well-being of children with special Over the year, people of this land are fighting with poverty
needs and disability. Considering the disabled children as and many other natural disasters. Being a corporate citizen
asset of the society, the Bank stands beside the authority of of the country, IBBL always stands beside the distressed
Proyash for fulfillment of their need.
humanity. By devising special deposit products, extending
Health Program financial inclusion and providing financial assistance,
the Bank discharges its responsibilities towards the poor
Health care is a basic need of all societies. But people are and less fortunate segments of the society. Disaster relief
facing here a perilous situation due to hazardous Medicare program includes winter cloths distribution, Donation to
system of the country. Considering this, IBBL takes several PM’s relief fund, distribution of Tohfa-e-Ramadan, sacrificial
initiatives in individual and organizational level for developing meat distribution, rehabilitation program etc. An amount
health sector of Bangladesh. IBBL spent an amount of Tk. of Tk. 721.65 million for 1,994,691 vulnerable persons was
1164.23 million for 7,144,761 beneficiaries from 1983-2014 spent by IBBL from 1983-2014.
for this purpose.
Winter cloth distribution program
Apart from these, IBBL takes some sustainable initiatives for
IBBL always stand beside the cold effected people of the
developing Medicare system of the country. Such as:
country. We have distributed more than 0.25 million warm
1. IBBL established 8 (eight) fully owned hospitals and cloths worth Tk. 65.37 million all over the country during
7 (seven) community hospitals of total 1077 beds winter of 2014.
creating employment of 880 doctors, 610 nurses and
1707 other employees. Tohfa-e-Ramadan
2. A number of Charitable Dispensaries, Arsenic Mitigation A unique step taken by IBBL for fasting people of the country
Program, Circumcision Camp, Mobile Eye Camp and named “Tohfa-e-Ramadan”. Under this Program we provided

CSR Report
Donation of Warm Cloth to Prime Minister’s Relief Fund
food items to 40,000 poor and religious scholars families install biomass processing plants, waste recycling plants and
amounting to Tk. 63.08 million during Ramadan 2014. Effluent Treatment Plants (ETPs) in our financed projects. We
Besides a program of street iftar was launched in 2012 and also educate and encourage our employees to be sensitive to
since than the program is running. the environment both inside and outside of the office.
Sports, Arts & Cultural Program Environmental Policy Statement

Sports, Arts & cultural programs make a nation physically IBBL is committed to doing its part to protect and care
and mentally sound and healthy. Engaging with this type of for the environments in it’s operations. This commitment
works young people could be able to avoid many bad things, is demonstrated by the continuous development and
as like taking drugs, hijacking money from innocent people implementation of practical and effective corporate policies and
programs that support more efficient use of natural resources
etc. This is why IBBL sponsors various sports & cultural
and reduce the impact of our businesses on the environment.
events every year. IBBL encourages sports and cultural
activities of its employees. An amount of Tk. 558.79 million Bank premises are taken with adequate space and interior
was spent by IBBL from 1983-2014 for this purpose. decorations are made to keep the office environment healthy and
work-friendly. Female employees are also provided with comfortable
Planet working environment along with other required facilities.
Environmentalism at IBBL Economic Development

The main theme of environmental responsibility is to protect Sustainability encompasses within itself apart from
the environment from destruction with a view to keep it environmental protection, the idea of human beings having
healthy for future generation. Recently, the issue of climatic what they need to survive and thrive. In a country like ours,
change is being considered seriously all over the world. It is economic development projects are crucial to giving people
identified that Bangladesh being a nation in southern delta is under a chance for a better wage, one that provides food, shelter,
serious threat of natural disaster. IBBL contributed an amount of clothing and perhaps even more. IBBL as part of its policy,
Tk.64.38 million for 1,825,460 beneficiaries from 1983- 2014. prioritizes the labor intensive and import substitute projects
to improve the economic wellbeing of the common messes.
We try to reduce our impact on the planet. We took initiatives Workforce Development
to reduce carbon emission through installation of solar
panels, introducing measures for saving electricity, water, Workforce development is one route to prosperity for
gas and fuel, encouraging double-sided printing, use of individuals in the world. A healthy planet needs people,
young and old, who are trained for work that pays a livable
scrap/one-side-used papers for note pad etc. We are strict to
wage for them to provide for themselves and their families.

CSR Report
Speaker of Jatiya Sangshad awarded Best patron award for outstanding contribution to the country’s sports sectors
IBBL has so far established institutes like Medical College, the society, IBBL takes various programs for empowering the
Health Technology Institute, Nursing Training Institute, English women through awareness building, training, financing etc.
medium school, Bangla medium school and girl’s madrasha The introduction of the deposit scheme namely “Mudaraba
and 6 Technical Institutes under its Foundation management Mohor Deposit Scheme” is a recognition to the women’s
to contribute for workforce development of the country. right and husbands are now coming forward to fulfilling their
Microfinance religious obligation to pay Mohor. Rural under privileged
women are organized under Rural Development Scheme
In the developing world, the path to prosperity can be and encouraged to make savings at least Tk. 10/- per week
challenging and can require a different approach than just with the Bank. The Bank deviced an investment Scheme
job training. IBBL believes in the power of microfinance — exclusively for the women namely “Investment Scheme for
small Investments made to individuals to start or expand the Women Entrepreneurs”.
their businesses — to lift people out of poverty and to give
them a better life. Distressed Women Rehabilitation Centre
IBBL started its microfinance operation through Rural The Bank has established a rehabilitation centre for the
Development Scheme (RDS) since 1995. So far, out of 294 distressed women namely “Islami Bank Distressed Women
branches, 221 carry out RDS activities in the country. The Rehabilitation Centre”. Distressed and destitute women
Bank launched another micro-finance scheme for urban poor are given shelter, education, training and employment
in 2012 in the name of ‘Urban Poor Development Scheme opportunities there.
(UPDS) on pilot basis under its 23 urban branches. These
two schemes enable IBBL to achieve financial inclusion of Profit
poor women of rural & urban areas.
We seek to make our country more prosperous through
Financing in SME Sectors the development of the financial system based on Islamic
principles and become the Global Leader in Islamic Banking.
SME is considered as the engine of growth in any economy
which generates a huge employment relative to big Commitment to the Shareholders
industries. Therefore, SME is essentially required to be
flourished in the country like Bangladesh. Keeping this in In the backdrop of volatile global and macro-economic
view, the Bank, from its inception, has been encouraging scenario as well as regulatory changes, IBBL made desired
investment in SMEs. To expedite SME investment, the Bank performances in different areas of business. Although
has opened 30 SME & Agriculture Branches especially in the nowhere in our vision and mission statement profit
rural areas of the country. maximization came as a priority issue, profitability has
become the logical outcome of our performance. From the
Contributing for Women Empowerment investors’ perspective, the IBBL’s stock always give high
Keeping in view the prevailing conditions of the women in yield to its shareholders.

CSR Report
Distribution of Sacrificial Meat by IDB President

Commitment to the Customers The Bank has already started Web Portal, SMS Banking and
Spot Cash services.
IBBL considers the customers as partners and develop long-
term sustainable relationships with them Different need Practicing Good Corporate Governance
based welfare oriented investment schemes contribute to We follow a structured and transparent corporate
the well-being of the customers.
governance culture where roles, duties and scope of policy
To encourage financial inclusion, customers can open a level & management level are well defined and the same are
saving account with Tk. 500/-, a current account with Tk. followed meticulously to make the organization thriving one
1,000/- and a special savings scheme (pension scheme) and moving towards its goal.
with minimum monthly installment of Tk. 100/- only. The Service rules governs the employee
rural poor are allowed to maintain savings account by
depositing weekly installment of Tk. 10/- only under Bank’s Every employee of the Bank is expected to adhere to the
Rural Development Scheme. service rules (code of Business conduct) of IBBL—no
exceptions. The service rule guides everything that we do.
The most important contribution of the Bank is the creation It governs the behavior of employee and includes corporate
of huge employment opportunities in its financed projects policies on employee relations, ethical business practices,
as well as in its own organization. At present 13,574 inspired compliance with laws and regulations, confidentiality,
people are serving in IBBL and millions in its financed projects. fair dealings, antitrust and competition, bribery and anti-
Through its wide-range network of 294 branches and utilizing corruption, marketing and sponsorships, among other
mobile phone technology, IBBL serves a huge number of rural topics. Violations of the service rules are taken seriously
families by channeling foreign remittance. The customers of and processes are in place to address alleged violations
the Bank have by now been extended online ATM services. confidentially and systematically.
Sector wise CSR expenditure in the Banking Industry
(In million Taka)
2010 2011 2012 2013
Sector Banking % of Banking % of Banking % of Banking % of
IBBL IBBL IBBL IBBL
Sector IBBL Sector IBBL Sector IBBL Sector IBBL
Humanitarian &
460.41 64.06 14 188.03 21.79 12 788.37 87.93 11 1385.83 140.10 10
Disaster Relief
Education 400.79 67.8 17 612.48 56.17 9 983.69 83.80 9 1295.18 135.26 10
Health 689.07 64.11 9 520.42 25.78 5 435.43 39.75 9 481.68 71.50 15
Sports 265.23 12.00 5 359.07 248.75 69 183.85 1.61 1 384.02 78.97 21
Art & Culture 328.91 11.22 3 171.52 7.15 4 213.31 8.24 4 124.75 5.86 5
Environment 59.78 7.36 12 138.07 0.48 1 140.23 12.48 9 106.59 22.94 22
Others 125.58 11.87 9 198.73 50.55 25 301.81 75.38 25 693.41 21.79 3
Total 2,329.80 238.42 10 2,188.33 410.67 19 3,046.69 309.19 10 4,471.49 476.42 11

Islami Bank Foundation
Islami Bank Medical College, Rajshahi
Islami Bank Foundation has been striving for service to the Islami Bank Medical College
distressed humanity and playing a significant role in social
service and development. The activities of the Foundation Islami Bank Medical College, Rajshahi is now running with
have increased manifold with the passage of time. During classes of different batches. Construction work of the south
the last years, the Foundation, apart from carrying on its block of the hospital building and Academic building at
regular programs has undertaken some new projects. A brief Nawdapara at own site of the college, has been completed
of the functions & performances of the foundation in 2014 and construction of the hostel for female students and
are given below: central mosque are going on. Out of 475 students in the
college and 55 students have completed the MBBS degree,
Health Care Program in 2014.
IBF has a number of programs under its health care program, Islami Bank Nursing Institute
these are:
To fill the gap of qualified nurses in the country, Islami Bank
Islami Bank Hospitals Foundation established its Nursing Institute in Rajshahi. Out of
259 students, 60 students completed the nursing course in 2014.
There are 07 (seven) Islami Bank Hospitals: 03 (three) are
in Dhaka, 02 (two) in Rajshahi, 01 (one) in Khulna and 01 Islami Bank Institute of Health Technology
(one) in Barisal. The hospitals extend health care services at
an affordable cost. 1,16,247 patients received free treatment In order to develop manpower with technical knowledge
facilities from these Hospitals in 2014. required at the health sector, Islami Bank Foundation has
established its Health Technology Institute in Rajshahi in the
Islami Bank Community Hospitals name and style “Islami Bank Institute of Health Technology”.
The courses introduced to meet the increasing demand of
07 (seven) Islami Bank Community Hospital are running in
the qualified Medical Technologist are (a) Pharmacy (b)
Satkhira, Manikgonj, Rangpur, Jhenaidah, Dinajpur, Faridpur
Dentistry (c) Radiology & Imaging (d) Pathology. Out of 373
and Naogaon. 7,912 patients received free treatment
students, 48 have completed their courses from the institute.
facilities from the Community Hospitals in 2014.

Class Room of Islami Bank Medical College Nursing Institute, Rajshahi
Midwifery Training Program The children are also given necessary medicine and other
necessary items at free of cost. In 2014, a total number
In the rural areas, untrained attendants extend Midwifery of 350 children received treatment through Circumcision
Service which lead to death of mothers and babies sufferings Program arranged in our hospitals.
from life due to wrong handling. Islami Bank Foundation
has organized Midwifery Training Program with the help of Educational Program
Islami Bank Hospitals and Islami Bank Community Hospitals
to make expert hands available for this purpose. Islami Bank Institute of Technology (IBIT)
Mobile Eye Camp IBF runs 6 Institutes of Technology of which 2 (two) are
in Dhaka, while one each in Bogra, Sylhet, Chittagong and
Rural people suffer from various eye ailments, but do not get Khulna. The institutes are engaged in training of unemployed
proper treatment. Islami Bank Foundation has introduced youths to make them self-reliant for technological
Mobile Eye camp project to render modern eye treatment advancement of the country. In the meantime, IBIT Dhaka
facilities to the people of all walks of life. Under this program (2 Units), Chittagong, Sylhet, Bogra and Khulna have got the
poor people are receiving eye treatment facilities at a nominal affiliation of Bangladesh Technical Education Board. In 2014,
cost while the rich people get the same at a subsidized rate. a total number of 2,471 Students have been enrolled with
IBITs. 189 students have completed their diploma courses
Charitable Dispensaries from the institutes so far.
A good number of Charitable Dispensaries in rural areas Islami Bank International School & College
are being run by IBF. The services include both Allopathic
treatment and Homoeopathic treatment. Qualified doctors As part of its social responsibility, IBF makes an attempt
give advices to the patients once or twice a week without to combine modern education with moral values for total
any fee. Necessary medicine is also supplied free of cost. development of the children and established an English
More than 30,000 patients received treatment from the medium International School and College at Senpara
Charitable Dispensaries in 2014. Parbata, Mirpur-10, Dhaka. In 2014, a total number of 304
Students were studying in the school.
Circumcision Program
Islami Bank Model School & College
Islami Bank Foundation organizes Circumcision Programs
in the rural areas in collaboration with local Hospitals. Islami Bank Model School and College is another project
Expert doctor conducts the operation for the poor children. of Islami Bank Foundation in the area of education. To

Monoram: Islami Bank Crafts & Fashion, Dhaka
render modern education with moral values, the school has Socio Cultural Program
been started at Mirpur, Dhaka. A good number of qualified
teachers have been appointed. Presently, as many as 617 Bangladesh Cultural Centre
students are studying in the school.
To save our youth force from derailment, it is essential to
Islami Bank Mohila Madrasah uphold and promote the culture of our own. Keeping in
view, Islami Bank Foundation has established Bangladesh
IBF has its involvement in Madrasah education also. Islami Cultural Centre in Dhaka and Rajshahi and establishment of
Bank Mohila Madrasah is a project of Islami Bank Foundation 33 centers are under process.
which is located at Mirpur, Dhaka. Presently, a total number
of 201 students are studying in the Madrasah. Islami Bank Women Rehabilitation Centre
As part of service to the distressed humanity, Islami Bank
Scholarship Program
Foundation has established a Centre for training and
IBF also runs scholarship programs to facilitate the rehabilitation of the vulnerable and shelterless widows
disadvantaged meritorious students. Under this program, and divorced women in the name and style of “Islami Bank
Scholarship is being provided to the students of Colleges, Women Rehabilitation Centre” at Mirpur, Dhaka.
Madrasahs and Universities. In 2014, a total number of Monoram - Islami Bank Crafts and Fashion
24 Poor Meritorious Students (who secured outstanding
results in SSC examination) received Scholarship from the 01 (one) Unit of MONORAM-Islami Bank Crafts and Fashion
Foundation. has been operating at Basundhara City (Level 4), and playing
a significant role for uplifting the condition of the poor and
Model Forquania Maktab distressed women channeling sales opportunity of their products.
Model Forquania Maktab under the Foundation allows It may be mentioned here that a total number of 3,933
children to learn recitation from the Holy Quran as well employees are serving in the IBF. Thus the Foundation
as to attain literacy in English and Bengali alphabets and through its multifarious welfare programs, is ceaselessly
elementary knowledge of Mathematics which helps them to working to serve the distressed humanity and change the
get admissions in the School and Madrasah. So far, 21,596 socio-economic condition of the un-privileged and neglected
students studied in the Forquania Maktabs. section of the society.

Management Report and Analysis
Business Development Conference
Business and Financial Overview over 2013. In 2014, the Bank secured 8.91% market share
of investment, Investments in corporate, SME, agriculture,
In spite of having volatile global & national economic situation housing, transportation, rural and urban development are
and regulatory changes in 2014, Islami Bank Bangladesh major sectors stated as below:
Limited was able to show consistent performance in most of
the business areas. It was possible because of the grace of Corporate Investment
Al-mighty Allah, Bank’s massive induction of new customers,
modernization of payment system, strengthened bank- Investment products of IBBL are fundamentally welfare-
customers relationship, enhanced service quality apart from oriented and inclusivity-driven to fit to the requirements of
complying banking regulations and Shari’ah rules. Shari’ah. Shari’ah objectives, while financing under different
modes, are met through diversification of investment by
Profit before Tax size, sector, economic purpose and geographical location.
The investment policy of the Bank has completely stirred
In 2014, the Bank earned highest operating profit in the integrating the latest concepts of inclusive growth, green
country’s banking sector. The profit before tax of the Bank finance and sustainable growth towards achieving Maqasid-
was Tk. 10,532 million during 2014. However, comprising al-Shari’ah. Investment products of IBBL include general
of the income of two subsidiaries of IBBL that is IBSL and investment, trade finance for domestic and international
IBCML, the consolidated profit before tax in 2014 was transactions, project finance and syndication services, and
Tk. 10,544 million. treasury operations.
Deposit Micro, Small and Medium Sector Investment
At the end of 2014, deposit of the Bank reached to Tk. 560,696 MSMEs account for 30% of GDP, 40% of employment,
million with an increase of Tk.87,555 million registering 80% of industrial jobs and 25% of the total labour force in
growth 19% over previous year. In 2014, IBBL’s market share Bangladesh. In 2014, IBBL’s SME exposure was 15% of the
in deposit stood at 8.68%, which was 8.15% in 2013. total national SME financing. IBBL’s SME contributes over
42% in the total investment of the Bank. The Bank was
General Investment involved in general and women entrepreneurs’ development
Total investment of the Bank stood at Tk. 463,475 million in particular by providing training, counseling and other
with an increase of Tk.60,280 million registering 15% growth facilities to them in 2014. IBBL sponsored and participated

in various programs like road-shows, fairs, seminars, System) network of Bangladesh Bank for facilitating
symposiums for the development of MSME sector. access of customers to all banks’ ATM booths. In 2013,
IBBL launched VISA debit card for POS and other related
Agriculture & Agro based Investment transactions facilities of the customers. Other ICT based
Investment in Agriculture and Agro based sector stood at TK. products includes online banking, e-banking, mCash, ATM,
60,970 million. Allocation in this sector as on December 31, SMS banking, Call Center, Phone Banking, e-recruitment, etc.
2014 is 13.15% of the total investment. Thus the Bank is facilitating its 9.5 million customers as well
as helping to keep ecological balance. IBBL has launched
Rural & Urban Poor Development Investment Hajj prepaid debit card in 2013 to fulfill instant cash need of
The performance of both RDS (Rural Development Scheme) the pilgrims. The Bank has launched VISA based Khidmah
and UPDS (Urban Poor Development Scheme) is improving Credit in the reporting year 2014.
systematically and gradually. In 2014, RDS investment
reached to 3.64% of total investment with 23% growth Investors’ Capital Management
whereas UPDS investment stood at 0.11% of the total
investment. By the end of 2014 the operation of RDS was IBBL always strives to give high Return on Equity (ROE) to
spread to 18,086 villages with 911,470 members through shareholders through prudential business decision while
27,874 centers. Besides, 23 branches under Dhaka and deploying their capital. The Bank has also implemented
Chittagong metropolitan cities implemented the Urban Poor the Revised Guidelines on Risk Based Capital Adequacy
Development Scheme (UPDS) in 2014 to alleviate poverty. for Banks as designed in Basel II. It is also in process of
implementing Basel – III although it is a Basel – III complied
Housing Investment Bank now with its Tire 1 capital. The Bank maintained Capital
Adequacy Ratio (CAR) above minimum requirement (10.00
The housing investment of the Bank stood at Tk. 40,006
%) throughout 2014 and it stood 12.83% (consolidated) as
million marking 8.63% of total general investment in 2014. on December 31, 2014.
Transportation Investment Operations and Compliance
Transport Investment of the Bank in 2014 became Tk. 6,435 The Bank adheres to the highest standards of risk
million which is 1.39% of the total general investment. management and compliance throughout 2014. The
compliance policies of the Bank are formulated following
the standards and policies of national and international
Total foreign exchange business of the Bank stood at regulatory and non-regulatory bodies. In 2014 the Bank
Tk. 848,447 million and marked 9% growth over 2013. The properly adopted the regulatory guidelines like Money
external sector performance on three major indicators of Laundering Prevention Act, Anti-Terrorist Act etc. to prevent
IBBL in 2014 is noted below: fraud and forgery.
• Import: Import business of the Bank in 2014 stood at Financial Inclusion
Tk. 316,971 million marking growth of 11% with market
share of 9.78%. IBBL kept continuity of sustainable financial inclusion
throughout 2014. Welfare and inclusivity oriented deposit
• Export: In 2014, the export business of the Bank was products such as Muhor, Cash Waqf, Hajj, Farmers etc. of
Tk. 222,753 with market share of 10.07%. the Bank highly partake to the development of economic
empowerment of less privileged people of the society. In
• Wage Earners’ Remittance: In 2014, the Bank’s total 2014, the Bank also reached to the unbanked people through
wage earners’ remittance stood at Tk. 308,722 million
various special programs and was able to open 29,789
making 25.53% market share. Farmer accounts, 44,748 Student accounts, 4,627 Mohor
In addition to the above areas, treasury, dealing room etc. accounts and 3,012 Cash Waqf accounts.
are the integral parts of the foreign business of the Bank. Green Banking
Information and Communication Technology The Bank used to emphasize on social, ethical and
environmentally responsible approaches to business
Since 2009 IBBL has been operating its own ATM network
activities. Keeping in view the spirit of Green Banking,
with 450 ATM booths now and above 4000 shared ATMs and
IBBL opened a Green Banking Department under its Risk
has planned to setup more 200 ATM booths throughout the
Management Wing (RMW) and took effective steps in line
country by 2014. In 2014, more than 7.2 million transactions with Central Bank’s directives. By now, the Bank has been
have been transmitted through IBBL ATM. Necessary steps able to reduce paper use substantially through automation
were taken to integrate IBBL with NPS (National Payment and simplification of its procedures.

Financial Branding Award by Centre for NRB’s
CSR Activities Being a welfare oriented bank, IBBL always strives for
highest standards of equity and distributive justice in the
IBBL through its various CSR programs is contributing field of all economic activities. The performance of the entity
significantly to develop socio-economic condition of is linked with the Management’s objectives and strategies in
Bangladesh. The Bank spent around Tk. 524.52 million the following manner:
as CSR expenditure in various sectors such as disaster
management, education, health, sports, art & culture and Welfare is a condition of having good health, comfortable
environment etc. in 2014. IBBL brought a new dimension living and pleasant working conditions. Hence, it can be said
to its CSR operations since 2013 donating Tk.150 million that welfare services are those which ensure conditions
to Proyash, an institute run under the patronization of of having good health, comfortable living and working
Bangladesh Army dedicated to the wellbeing of children conditions, which are generally one’s basic needs. Islam
with special needs and disability. Thus, IBBL has been views work as the primary means of earning and acquiring
exerting CSR in areas of basic needs such as education income and wealth. As such, IBBL has earned reputation to
and healthcare, particularly for the underprivileged section ensure welfare oriented banking services through its welfare
of population in our society. IBBL has made a number of oriented Special Investment Schemes, Cash Waqf Deposit,
successful cases over time through its CSR engagements. dynamic Corporate Social Responsibility, Mobilization of
Zakah etc.
Relationship between the entities performance with
the management’s objectives and strategies Financial inclusion has emerged as a tool to achieve
inclusive growth for poverty reduction since 2005, a year that
Management’s objectives are consciously directed toward
the UN has declared International Microcredit Year. Studies
that effective and efficient achievement of organizational
indicate that a positive correlation exists between financial
objectives. On the other hand, management’s strategy
development and economic growth. Current development
involves formulation and implementation of the major goals
theories suggest that greater financial inclusion can have a
and initiatives taken by a company’s top management on
positive impact on the lives of the poor. IBBL based on its
behalf of owners, based on consideration of resources and
Rural and Urban Poor Development Schemes as a successful
an assessment of the internal and external environments
model has a share of more than 50% of the world Islamic
in which the organization competes. Management strategy
microfinance. Welfare and inclusivity oriented deposit
provides overall direction to the enterprise and involves
products such as Muhor, Cash Waqf, Hajj, Farmers etc. of
specifying the organization’s objectives, developing policies
the Bank highly partake to the development of economic
and plans designed to achieve these objectives, and then
empowerment of less privileged people of the society.
allocating resources to implement the plans.

Our efforts continued during the whole year under review macroeconomic fundamentals. The major challenges faced
to further diversify investment portfolio by size, sector, by the banking industry were sluggish Investment (credit)
economic purpose & geographical location. Alhamdulillah, growth, increasing trend of non-performing investment
we see positive shift in our investment portfolio in reducing (credit) resulting to higher provisioning requirements
concentration in big clients. Investment share of top 100 and surplus liquidity. The cumulative effects of these put
clients to general investment decreased. Percentage of pressure on the profitability of the banking sector as a
investment up to Tk.100 million to general investment whole. Being an integral part of the banking industry, IBBL
increased. SME investment & rural investment to our general had to face the challenges. Despite all the challenges, IBBL
investment increased. could close the year in a positive note.
Investment in thrust sector of the economy of our Outlook for 2015

country falls under the priority areas of IBBL. The Bank
has considerable amount of investment in the industrial The economy of Bangladesh, one of the most potential
sector. IBBL ventured in financing garment industries in emerging economies of the world, is yet to overcome the
the early stage of the Industry. The Bank also financed in persistent political instability. This uncertainty has halted the
the backward linkage industries. It is mentioning here that, confidence of the businessmen to step forward. IBBL, being
most of the leading export-oriented garment industries of one of the leading players of this economy, is committed to
the country initially started their business taking small size meeting all the needs of every family of Bangladesh. IBBL
investment from IBBL. is going to focus more on inclusivity driven sustainable
financing for becoming the ‘Bank of Choice’ for all. The short-
Development of human resources is a must to ensure and mid-term strategies to achieve the desired success are
sustainable growth and advancement of an organization. as follows:
This approach is a framework for helping the employees
develop their personal and organizational knowledge, • Efficient fund management through deploying surplus
skills and abilities by means of extensive improvement liquidity in priority sectors with particular focus on
process covering systematic training, motivation, coaching, small and medium enterprises.
counseling, mentoring and the likes. This is also an
• Mobilization of low cost deposit be strengthened while
initiative to equip & assist the staffs to be adequately
investment diversification will be made with more focus
improved to shoulder optimum workload towards efficient
in service and infrastructure sectors.
accomplishment of organizational goals.
• Competitive pricing of Asset and liability products will
To materialize the spirit of the above, a comprehensive as
be ensured.
well as inclusive development initiative covering various
dimensions is accomplished by Human Resources Division. • Vigorous risk management practices and a high level
Apart from the traditional top-down approach of human of vigilance will be maintained to keep asset quality at
development, an initiative is going on to transform every standard level.
Branch into a Center of Excellence to ensure effective
capacity building of the employees of every tiers. • 100% compliance will be ensured in all respects through
both on-site and off-site supervision.
IBBL is also committed to provide banking services that are
purely based on Islamic Shari’ah, transparent and efficient. • Implement a rigorous talent management and industry
It always struggles for achieving the utmost stage of best human resource development program.
excellence to establish a set of managerial succession and
adopt technological changes to ensure the development of
• New products will be developed to cater the various
needs of the client of different strata and add value to
an Islamic Bank as a stable financial institution, emerge as
the existing products and services.
a healthier & stronger bank at the top of the banking sector
and continue stable positions in all the major business • Automation process will be strengthened to bring more
indicators. customers under virtual banking and upgrade services
networks.
Challenges in 2014
Banking sector in Bangladesh has come across another
• Steps will be taken to ensure green and sustainable
growth of banking business.
turbulent year facing many odds and pitfalls in the

Products & Services

Deposit Products • Non-Resident Investors Taka Account (NITA) for
Foreign Portfolio Investors.
Deposit Products in Local Currency • Non-Resident Taka Account (NRTA) for Foreign Direct Investors.
• Al-Wadeah Current Account (AWCA) • Foreign Currency Account for EPZ Companies (FCA-EPZ)
• Mudaraba Savings Account (MSA) • Foreign Currency Account of EPZ Enterprise
• Mudaraba Special Notice Account (MSNA)
• Mudaraba Special Savings (Pension) Account (MSSA) Investment Products & Schemes
• Mudaraba Term Deposit Account (MTDA) Investment Products
• Mudaraba Savings Bond Account (MSBA)
• Bai-Murabaha
• Mudaraba NRB Savings Bond {M(NRB)SB}
• Bai-Muajjal
• Mudaraba Hajj Savings Account (MHSA)
• Bai-Istijrar
• Mudaraba Waqf Cash Deposit Account (MWCDA)
• Bai-Salam
• Mudaraba Monthly Profit Deposit Account (MMPDA)
• Bai-Salam (Pre-shipment)
• Mudaraba Muhar Savings Deposit Account (MMSDA)
• Bai-Istisna
• Students Mudaraba Savings Account (SMSA)
• Mudaraba
• Mudaraba Farmers Saving Account (MFSA)
• Musharaka
• Mudaraba Upohar Deposit Scheme (MUDS)
• Musharaka Documentary Bill (MDB) Inland
Deposit products in Foreign Currency • Musharaka Documentary Bill (MDB) in Foreign Currency
• Musharaka Investment in Potato Storage
• Mudaraba Foreign Currency Account (MFCA)
• Hire Purchase under Shirkatul Melk (HPSM)
• Mudaraba Exporters’ Retention Quota Account (MERQ)
• Murabaha Post Import (MPI)
• Foreign Currency Account (FCA)
• Murabaha Import Bills (MIB)
• Foreign Currency Account (ERQ)
• Murabaha Import LC
• Resident Foreign Currency Deposit Account (RFCD)
• Murabaha Foreign Currency Investment (MFCI) under EDF
• Non-Resident Foreign Currency Account of Exchange
Houses/Banks
• Murabaha Foreign Currency Investment (MFCI) under
Balance of MFCD A/C

Products & Services
• Bai-Muajjal Back to Back Bills Remittance Services

• Bai-as-sarf (Foreign Documentary Bill: FDB)
Foreign Remittance Services
• Bai-as-sarf (Foreign Currency Cheques/Drafts: FCD)
• Central Crediting Account
Welfare-oriented Investment Schemes
• Payment of 3rd Bank Remittance through TT & PO
• Household Durable Scheme (HDS) • Payment of Spot Cash Remittances
• Housing Investment Scheme (HIS) • Centrally NRB Accounts Opening
• Real Estate Investment Program (REIP) • SMS Notification
• Transport Investment Scheme (TIS) • SMS Push Pull Service
• Car Investment Scheme (CIS) • Maintenance of NRD & NRT Account
• Investment Scheme for Doctors (ISD)
• Small Business Investment Scheme (SBIS) Inward remittance
• Agriculture Implements Investment Scheme (AIIS) • Electronic Fund Transfer
• Rural Development Scheme (RDS) • Spot Cash
• Micro Enterprise Investment Scheme(MEIS) • Application for Programming Interface
• Urban Poor Development Scheme (UPDS) • Encashment of cash Foreign Currency
• Micro Industries Investment Scheme(MIIS) • Collection of F.C. Cheques /Drafts
• Women Entrepreneurs Investment Scheme • Payment of Foreign TT & DD (FTT & FDD)
• Palli Griha Nirman Beniyog Prakalpa
Outward Remittance
• NRB Entrepreneurs Investment Scheme (NEIS)
• Solar Panel Investment Scheme(SPIS) • Travel purpose
• Study purpose (Student File)
Offshore Banking Unit (OBU) Products
• Medical purpose
Depsoit Products • Issuance of Foreign TT & DD (FTT & FDD)
• Al-Wadeah Current Account (FCA) • Selling/Issuance of Foreign Currency note
• Mudaraba Savings Account (MFCA) • Travel Pre-paid Card
Investment Products • Commercial Remittance
• Bill Financing under Mudaraba Documentary Bills • Different Private Remittance

(Mura-UPAS) against Usnace import Bills
Treasury Activities
• Bill Financing under Mudaraba Documentary Bills
(HPSM-UPAS) against Usnace import Bills Dealing Room Operations
• Bill Financing under Mudaraba Investment for MDB in
• Foreign Exchange Operations
FC against Inland Export Bills
• Import Financing
• Money Market Operations
• Export Financing Money Market Operations
• Short term Murabaha
• Pre-Shipment Financing (Bai-Salam in FC)
• Placement to other Islami bank & Financial Institutions.
• Post-Shipment Financing (Bai-as-Sarf, MDB in FC)
• Bangladesh Government Islamic Investment Bond
(BGIIB)
• Project Finance (HPSM investment)
• Islamic Interbank Fund Market (IIFM)

Products & Services
Technology Based Services • Export Bills Collection

• Substitute Cash Assistance
Any Branch Banking Services
• SWIFT
• Largest countrywide online banking facilities • Automated Clearing
• Lowest fees for online deposit across the country • IBBL Call Center
• Charge Free for depositing Tk.1,00,000/- within • Phone Banking
Divisional City
• Payment Gateway
• Any branch cash deposit
• Point of Sale (POS)
• Quickest fund transfer
• Charge free for Investment recovery/disbursement.
• Islami Bank Service Centre
Upcoming Services
Cash Service
• 450 Own ATM booths and above 4000 shared ATM
• Upcoming debit facility from POS with Biometric option
• 8 IDM (Islami Bank Deposit Machine) • mCash withdraw From ATM

• Connectivity with OMNIBUS & VISA network • Full fledge corporate banking module
• 24 hour support service for ATM • Centralized Investment Proposal Processing System
• ATM card
• Hajj card service
Services through Islami Bank Foundation
• Visa Debit Card • Islami Bank Hospitals
• Travel card • Islami Bank Medical College, Rajshahi
• Khidmah Credit Card • Islami Bank Community Hospitals
• Salary Card
• Islami Bank Nursing Training Institute
Corporate Services • Islami Bank Institute of Health Technology
• Free/reduced charges of ATM • Islami Bank Homeopathic Clinics
• Standing Instruction facility for depositing MSS & Hajj A/c • Monorom: Islami Bank Crafts & Fashion
• Existing BEFTN facilities through Bangladesh Bank
• Islami Bank Institute of Technology
• Existing BACPS service through Bangladesh Bank
• Islami Bank International School and College
• Crediting salary within one hour throughout the Country
• Centralized foreign trade processing system • Islami Bank Model School
• IBBL Online money transfer • Islami Bank Mohila Madrasah
Other Value Added Services • Bangladesh Cultural Centre
• Payment Order (PO)

• Distressed Women Rehabilitation Centre
• Demand Draft (DD) Training Services

• Telegraphic Transfer (TT)
• Locker
• International: Officials of Foreign Banks on Islamic
Banking
• Quard against TDR
• Counseling
• National: Training of own manpower & others on Islamic
Banking
• IBBL Web portal facility
• Letter of Credit Diploma in Islami Banking
• Back to Back Letter of Credit Islami Bank Training & Research Academy (IBTRA) has
• Bank Guarantee launched a professional Banking Diploma Course in the name
• Foreign Bank Guarantee as ‘Diploma in Islamic Banking (DIB)’ for the professionals
working in the Bank & financial industry.

Alternative Delivery Services
Launching of VISA Debit Card
Modern technology in Banking has made our life easy • 24 hour Cash withdrawal from VISA supported ATM booth;
and enjoyable. As the biggest commercial Bank in the
country, Islami Bank Bangladesh Limited has introduced • Hotel and Hospital booking, Bus, Train and Airplane
a number of technology based products through various Ticketing;
Alternative Delivery Channels (ADC) to render quick, easy
and personalised banking services to customers. Through
• Connectivity with OMNIBUS Network;
using these products and services, the customers can • E-commerce facilities over internet.
avail necessary banking facilities round the clock. The ADC
facilities of the Bank are furnished below: Phone Banking
VISA Debit Card By using Phone Banking, the customers can enjoy banking
services round the clock. Major services are:
To save the customers from hazards of carrying cash and to
ensure availability of cash in need, the bank has introduced • Balance Inquiry;
VISA supported debit card. The customers can withdraw
cash up to fifty thousand from all VISA and Omnibus ATM
• Mini Statement;
booths throughout the country by using this card. Major • Fund transfer;
features are:
• Mobile Phone Recharge;
• No issuance fee (free of charge for the 1st year);
• Utility Bill Payment;
• Alternative to cash for shopping;
• TPIN Request;
• Exclusive discount on the purchase at Superstores;
• Cheque Book Requisition;
• Mini Statement;
• Stop Payment;
• Remittance Services and many more.

Launching of Islami Bank Khidmah Card
i-Banking • Free SMS Banking;

To reach the Banking services within a click of finger, the • Balance inquiry;
Bank is providing internet banking services to the customers. • Mini Statement;
Major features of i-Banking are:
• Push/Pull service by SMS from mobile;
• Anytime Banking from anywhere;
• SMS push services.
• Account Balance Inquiry;
mCash
• Mini Statement;
The Bank has been rendering modern technology based
• Fund transfer at the lowest fees; services to the customers through mCash. Major features
• i-recharge completely free of charge; are:
• Utility Bill Payment; • Cash Deposit and Withdrawal;

• Instant Fund Transfer;
• Wimax bill payment/recharge;
• Remittance Service;
• Instrument/Challan/Sales Proceed number can be • Account Balance;
viewed;
• Mini Statement;
• Status of clearing instruments;
• Salary Payment and Receive;
• Foreign remittance status; • Mobile Phone Recharge;
• Payment of Khidmah Credit Card Bill; • Utility Bills Payment;
SMS Banking • Corporate Payment;

• Merchant Payment;
The customers can avail this facility after registration
of their mobile number through push/pull service. Major
• Tuition fee Payment;
features are: • Govt. Payment.

‘Khidmah’ Credit Card Salary Card

IBBL has introduced Shari’ah based credit card ‘Khidmah’ • Payment of Salary & allowances of service holders by
with a view to provide credit facility for limited income this card without maintaining account;
people within their ability, to meet the daily demand and to • Cash withdrawal from ATM Booth and shopping through
develop the living standard of the people. Three categories- POS are allowed
Platinum, Gold and Silver- are available at all branches of the • All facilities of VISA Debit Card are also permissible
Bank across the country. Major features are:
• Shari’ah- Compliant Credit Card;
• Payment of gas, electricity and WASA bill;
• Hotel and Hospital booking, Bus, Train and Airplane E-Commerce
Ticketing; • Online Shopping;
• Exclusive discount on the purchase at superstores; • POS (Point of Sales);
• Lowest charge; • Bus and Air Ticketing;
• First Supplementary Card free; • Utility Bill Payment;
• Card Cheque Facility. • Mobile Recharge.
Remittance Card
• Deposit of Foreign Remittance;
IDM-Islami Bank
• Draw money from any IBBL booth; Deposit Machine
• Card Balance Enquiry;
The customers can deposit money in IDM round the clock.
• Bank account is not necessary; The service is especially beneficial for the businessmen.
• Balance enquiry from SMS or i-banking service.
IBBL Call Centre: 16259
Hajj Card
• Balance Enquiry;
• Pilgrims may make transaction in the ATM Booth and
Point of Sale (POS) at Saudi Arabia through this card; • Cheque Book Requisition;
• Hajj Agencies may consume service by this card; • Stop Payment;
• Can be used to perform Umrah. Maximum transaction • Products and Services
is allowed up to USD 500 as per Bangladesh Bank rule; Information;
• One can get service by Hajj card without bank account. • 24 Hours Service.
Travel Card
• Cash withdrawal and transaction service from any
place of the world through travel card;
• Maximum transaction allowed up to USD 5,000 as per
Bangladesh Bank rule;
• One can get service by Travel Card without bank
account;
• Any time one can reload in this card by any branch of
IBBL or authorized agent.

Communication and Business Promotion
IBBL Pavilion at Dhaka International Trade Fair 2014
Being the largest private commercial bank of the country, the Bank, articles on Islamic Banking, and interviews of top
Islami Bank Bangladesh Limited is to maintain relationship management were published in the newspapers, magazines
with its various internal and external parties like shareholders, and periodicals widely. In the electronic media, the Bank
depositors, customers, regulators, employees and other got a good coverage each month. A documentary video
stakeholders. The Bank is earnestly engaged in bridging was produced this year on the performances of the Bank.
and maintaining mutual relations, communication, and co- Different types of advertisements were published in print,
operation with the management and its public, keeping the electronic and web based media round the year. Besides,
management informed and responsive to public opinion magazines, periodicals and souvenirs have published
about the Bank. A dedicated Public Relations (PR) team is advertisements and write-ups on different products and
working to take vibrant multidimensional publicity manners services of the Bank. The Bank’s TVCs were telecasted in
of the Bank. TV channels round the year. Billboards in different public
places, news branding & magazine programs in different TV
Publicity channels were also publicity manners of the Bank. A number
Publicity of IBBL encapsulates various media exposures like of newspaper and electronic advertisements were also
press release, feature, article, interview of top management, designed and developed in the year 2014.
advertisement etc. In the year 2014, IBBL held the top Public Relations & Motivation
position in publishing press release and news in different
media like previous years. Leading dailies, weeklies, IBBL sponsored different organizations, associations,
quarterlies and monthlies magazine as well as web-based agencies and forums on occasion of their founding
news-portals published our press releases with an average anniversaries, conferences, conventions, seminars and
of 12-15 items per month on different programs of the Bank. other celebrations round the year with a view to bridging
Features on different products, services and schemes of and maintaining friendly relationship with public, promoting

Communication and Business Promotion
Central Iftar Mahfil
the Bank and its products & services, performing CSR sponsored different organizations like National Press Club,
activities etc. The Bank patronized country’s sports and Dhaka Reporters Unity, govt. agencies, local journalist
culture through sponsoring various events like national organizations, social organizations, literary organizations,
school football tournament 2014-15, National Cricket Team professional organizations and educational institutions on
and Asian Games Qualifying Hockey Tournament in the year various occasions round the year.
2014. The Bank participated in Dhaka International Trade
Fair- 2014, National SME Financing Fair-2014, National Publications
Migrants Day Fair 2014, National Agro-tech Fair, American The Bank published a good number of publications in 2014
Chamber of Commerce Fair 2014 and many more. The Bank including ‘Arthonoitik Jibone Taqwa and Islamic Banking’
organized public programs like get-together, discussion, and ‘Bangladeshe Islami Banking: Sokkhomota o Sofolotar
seminar, clients gathering, entrepreneur development Nirikhe. Besides regular publications like Islamic Banking
program and Iftar Mahfil in the month of holy Ramadan Journal, House-magazine Islami Bank Porikroma and RDS
in different branches and Head Office where people of all magazine Palli Unnayon Barta, diary and calendar for the
segments of the society participated. Eid cards, newyear’s year 2015, a number of folders, leaflets, posters, danglers,
greeting cards and other complementary gift items festoons, banners, invitation cards, brochures were designed
were distributed among the customers, clients, guests, and printed during the year.
senior journalists on various occasions. The Bank also

Stakeholders’ Information
Distribution of Shareholding
Sl. Particulars No. of shares Percent- (Taka) No. of shares Percent- (Taka)
No. as on age as on age
31.12.2014 (%) 31.12.2013 (%)
to total to total
1 Sponsors / Directors Local 94,789,531 5.888% 947,895,310 86,352,508 05.900% 863,525,080
2 Foreigners :
Foreign Sponsors/Directors 844,989,115 52.484% 8,449,891,150 774,959,058 52.948% 7,749,590,580
Excluding Foreign Sponsors/ 237,695,347 14.764% 2,376,953,470 196,548,232 13.429% 1,965,482,320

Directors
Sub-total 1,082,684,462 67.248% 10,826,844,620 971,507,290 66.377% 9,715,072,900
3 Govt. of Bangladesh** 20,317 0.001% 203,170 18,470 00.001% 184,700
4 Institutions (Excluding Foreigners) 99,632,137 6.188% 996,321,370 92,476,758 06.318% 924,767,580
5 General Public 332,864,221 20.675% 3,328,642,210 313,272,854 21.404% 3,132,728,540

Total 1,609,990,668 100.00% 16,099,906,680 1,463,627,880 100.00% 14,636,278,800
Foreign: 1,082,684,462 67.25% - 971,507,290 66.38% -
Local: 527,306,206 32.75% - 492,120,590 33.62% -
** The shares have already been sold by the Government of Bangladesh but no transfer has been made in share register of the Bank.
Evaluation of Paid-Up-Capital
(In million Taka)
Year Particulars Increase Total
1983 Initial Capital 0.50 0.50
1983 Sponsors (56 million Foreign, 11.50 million Bangladeshi, 4 million Govt. of Bangladesh) 71.50 72.00
1985 I.P.O 8.00 80.00
1990 1st Rights/1989 (1R:1) 80.00 160.00
1996 2nd Rights/1996 (1R:1) 160.00 320.00
2001 3rd Rights/2000 (1R:1) 320.00 640.00
2003 4th Rights/2003 (2R:1) 1,280.00 1,920.00
2004 Bonus/2003 (1B:5) – Stock Dividend @20% 384.00 2,304.00
2009 Bonus/2008 (3B:10) – Stock Dividend @30% 1,425.60 6,177.60

Share Price Status in the Stock Exchanges - 2014

(In Taka)
DSE CSE
Month
Highest rate Lowest rate Average rate Highest rate Lowest rate Average rate
January 36.30 34.00 35.15 37.00 31.50 34.25
February 36.00 34.50 35.25 37.00 31.90 34.45
March 36.80 33.00 34.90 35.30 31.00 33.15
April 34.60 25.00 29.80 34.40 25.50 29.95
May 26.40 24.00 25.20 26.50 23.10 24.80
June 25.60 22.40 24.00 25.80 20.30 23.05
July 25.60 23.60 24.60 25.20 21.60 23.40
August 24.70 22.80 23.75 26.00 20.70 23.35
September 25.60 22.80 24.20 25.10 20.60 22.85
October 29.90 24.80 27.35 29.60 23.00 26.30
November 27.00 24.60 25.80 29.00 22.90 25.95
December 27.00 23.30 25.15 26.50 22.80 24.65
During 2014 36.80 22.40 29.60 37.00 20.30 28.65
Stock Details of Shares and Bonds
Sl. No. Particulars DSE CSE

1 Share Symbol ISLAMIBANK ISLAMIBANK
2 MPB Symbol IBBLPBOND IBBLPBOND
3 Company Code 11104 22008
4 Share Listing Date 02.07.1985 07.03.1996
5 MPB Listing Date 25.11.2007 25.11.2007
6 Market Category ‘A’ ‘A’
7 Electronic Share Yes Yes
8 Face Value of Shares (Taka) 10 10
9 Face Value of MPBs (Taka) 1000 1000
10 Market Lot of Shares (Nos) 1 1
11 Market Lot of MPBs (Nos) 1 1
12 Total Shareholders 60,857 60,857
13 Total MPB Holders 23,272 23,272
14 Position in Stock Exchanges DSE-30 CSE-30
15 Closing Market Price of Share (Taka) 23.40 (30.12.14) 23.80 (30.12.14)
16 Closing Market Price of MPB (Taka) 989.00 (30.12.14) 970.50 (30.12.14)
17 Highest Price of Share (Taka) 36.80 (13.03.14) 37.00 (05.02.14)
18 Lowest Price of Share (Taka) 22.40 (25.06.14) 20.30 (18.06.14)
19 Highest Price of MPB (Taka) 1050.00 (03.03.14) 1020.00 (27.03.14)
20 Lowest Price of MPB (Taka) 881.00 (07.04.14) 860.00 (20.04.14)

Accessibility of Annual Report to make the AGM more participatory, it is arranged in a well-
known place & convenient time within the city of the corpo-
Annual Report 2014 including independent auditors’ report rate head office to allow shareholders to attend and speak in
and audited financial statements of the Bank may be ac- the AGM freely and address their valuable suggestions. Any
cessed on Bank’s Website: www.islamibankbd.com. IBBL queries relating to shareholders such as transfer of shares,
provides copies of Annual Report to the Bangladesh Secu- changes of name and addresses and payment of dividend
rities and Exchange Commission, Bangladesh Bank, Dhaka may be communicated to the following address:
Stock Exchange and Chittagong Stock Exchange for their
reference. Share Department
63, Dilkusha Commercial Area
Governance on Investors’ Relation (5th Floor), Dhaka-1000.
PABX: 9551105, 9551062, 9550415;
IBBL is strongly committed to equitable treatment of every
Ext-627,624,615 Fax: 9564595
shareholder. The Company Secretary of Islami Bank Bangla-
E-mail: ibblshare@islamibankbd.com
desh Limited may address queries relating to any corporate
information and published financial information if sought by Redress of Investors’ Suggestions
the respected shareholders.
In the 31st Annual General Meeting, shareholders provided
suggestions about different aspects of financial, develop-
Investors’ Inquiries and Communication ment and services of the Bank. Management of the bank
has tried to address the issues with due care. Those sugges-
Shareholders and others may contact at any time to share tions/complaints along with the status are as follows:
department for any sort of information and query. In order
Shareholders’ Suggestions and their Implementation Status
Sl.
Suggestions/observations Redressal
No.
Attention was drawn on the reduction of Foreign Ex- Due to overall macro economic slow down we experienced
change Income (FX) of IBBL and it was suggested to downturn in FX business. However, we are trying our level
boost up foreign remittance through campaign in Gulf best to earn more income from Foreign Exchange Business
Countries. and maintained of our leadership in FX business. Presently,
01
we have got remittance arrangement with 126 Exchange
Houses/Banks in different countries which will be enhanced
in near future. We are in the process of updating our remit-
tance policy so that we can ensure more remittance espe-
cially from Exchange Houses/Banks in Gulf countries.
Some Shareholders requested to open more Branch- The issue is under active consideration of management. Com-
es in the rural areas specially South-Eastern part of petent authority has planned to open branches on priority ba-
02
the country and advised to operate the newly opened sis based on potentiality subject to approval of Bangladesh
branches by the existing employees. Bank.
It was pointed out that the Commission Income of In order to increase income of IBSL several steps like increas-
IBSL” (Islami Bank Securities Ltd., a subsidiary compa- ing no. of B/O accounts, facilitating hassle-free trade and fund
03 ny of the Bank) was very low. transfer in trading, online IPO subscription etc. have been tak-
en.
It was requested to hold the future AGM on Friday or It will be considered subject to availability of suitable venue
04
Govt. Holiday, if possible. and other regulatory rules.
It was requested to distribute /credit the dividend with- Dividend for the year 2013 has been credited within 7 working
05
in 15 (fifteen) days after the AGM. days of AGM.

Sl.
Suggestions/observations Redressal of the Investors’ Complaints
No.
Some Shareholders suggested to publish & print the Full version of the annual report is published in the website of
Annual Report in abridged form with important data/ IBBL (www.islamibankbd.com)
06
information and sending the same through e-mail to
the respective shareholders.
All-out efforts to be taken to reduce the overdue, clas- All out efforts have been taken to reduce the overdue, classi-
sified & written-Off investment and provision against fied & written off investment.
07 non-performing investment to be reduced at minimum
level.
Promotional activities to be boosted up for populariz- mCash network has been expanded by deploying 155 distrib-
ing mCash product. utors, 26,545 agents across the country for serving almost
16 lac mCash customers of the country as well as to induct
08
new mCash accounts. Advertisement in different print and
electronic media have also been extended for popularizing the
same.
It was suggested to render better customer services by Presently, almost all the branches of the bank have been well
the Branch officials. equipped with Help Desk for attending customers queries.
Almost all the branches are now delivering one stop banking
09 services. IBBL Call Center (16259) is rendering customer solu-
tions round the clock. The Bank has expanded its network up
to the doorsteps of the customers by establishing 450 owned
& more than 4000 shared ATM booths throughout the country.
Shareholders suggested for extending the RDS pro- RDS activities have been running through rural branches with-
10 gram of the Bank in each & every village throughout in 10 kilometer radius of the branch premises. Suggestions
the country. will be implemented gradually.
It was suggested to run the ICTW with IT specialist peo- Our ICTW is running by IT specialists. Steps have been taken to
11
ple and urged to make the Bank’s website user friendly. make the website more user friendly.
A good number of executives/officers have attended foreign
It was urged to train up the employees of IBBL in For- training/seminar/workshop in addition to training in local in-
12 eign or Local institutions and also to arrange foreign stitutions. Management has also taken a plan to provide for-
education for the bright and scholar employees of IBBL. eign training to our executives/officers in a large scale as per
requirement of the Bank.
The existing employees of the bank are being reallocated in
different jobs/ duties/ responsibilities as per their capability,
Some Shareholders urged to reallocate the present
13 productivity as well as considering potentiality of business
manpower instead of any fresh recruitment.
volume. Human resources base has been planned to be ratio-
nalized to get maximum output.
It was stated that though the Bank is the best in all Generally, the pay package of the Bank is reviewed within two/
respects, the pay package and other facilities for the three years time. Lastly the pay package was revised on July,
employees of the Bank is lower than those of the con- 2012. The existing pay package is expected to be reviewed
14
temporary private Banks in Bangladesh, which should very soon.
be increased further to make it at the top in the Banking
Industry.

Graphical Presentation
Earning Per Share Net Assets Value Per Share
(In Taka) (In Taka)
28.95
27.18
27.18
6.02
23.48
4.84
22.22
4.42
3.40
2.48
2010 2011 2012 2013 2014 2010 2011 2012 2013 2014
Shareholders’ Equity Return on Equity (ROE)

(Million Taka)
46,613
19%
43,761
39,780
17%
13%
11%
27,800
9%
23,494
2010 2011 2012 2013 2014

2010 2011 2012 2013 2014
Market Capitalization Net Profit after Tax

(Month end closing price of DSE in 2014) (Million Taka)
60000
(Million Taka)
5,339
4,841
4,949
3,999
50000
4,463
40000
30000
20000
10000
0
y
ry
ch
ril
ay
ne
A ly
em t
Oc er
ve er
ce er
r
be
pt us
ar
Ju
ua
Ap
No b
De mb
M
ar
Ju
2010 2011 2012 2013 2014

nu
Se ug
m
M
br
t
Ja
Fe

Graphical Presentation
Import, Export & Remittance
Deposit & Investment (Million Taka)
564,332
473,141
474,016
560,696
(Million Taka)
301,207
417,844
316,971
300,915
285,890
284,588
399,931
308,722
286,956
341,854
246,281
322,772
236,607
214,629
205,269
222,753
291,935
275,494
197,095
178,244
148,421
2010 2011 2012 2013 2014
2010 2011 2012 2013 2014
Export Remittance Import
Deposit Investment
Total Assets Total Equity (Regulatory)

(Million Taka) (Million Taka)
765,241
48,570
660,946
45,487
592,581
42,053
502,613
443,685
33,717
28,400
2010 2011 2012 2013 2014

2010 2011 2012 2013 2014
Return on Assets (ROA) Gross Profit Ratio

1.47%
1.35%
52%
52%
1.27%
48%
47%
45%
0.96%
0.67%
2010 2011 2012 2013 2014 2010 2011 2012 2013 2014

Segment Information
Sector Wise Investment Area Wise Investment
1%
2% 4%
8% SME
9%
Industrial Excluding SME
5%
Rural Area
Commercial
42%
Real Estate Urban Area
34%
Agriculture
95%
Transport
Others
Operating Result Group Performance

(Million Taka) (Million Taka)
Total Income
3,9
3,967
99
10,532
Total Expenditure
10,544 27,471 Total Operating Income
Net Profit before Tax
58,047 Total Operating Expense
Net Profit after Tax
42,724 Net Profit before Tax
12,103 Net Profit after Tax
Division Wise Investment Division Wise Income

1%3% 2%
2% 1% Dhaka
9% Dhaka
3%
6% 9% Chittagong
Chittagong
6%
Khulna
59%
Khulna
20% Rajshahi
Rajshahi 59%
20%
Rangpur
Barishal
Sylhet
Rangpur
Barishal
Sylhet

Horizontal & Vertical Analysis
Operating Performance
2010
2011
2012
2013
2014
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
Total Revenue Operating Profit Profit Before Tax Profit after Tax EPS
Operating Performance
100
90
80 Profit after tax
70
60 Profit before tax
50
40 Operating Profit
30
Total Revenue
20
10
0
2010 2011 2012 2013 2014
Statement of Financial Position

2010
2011
2012
2013
2014
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
Shareholders Fund Property Plant & Wquipment

Net Current Assets Current Liabilities
Long Term Liabilities

100
90
80 Long Term Liabilities
70 Current Liabilities
60 Net Current Assets
50
Property Plant & Equipment
40
Shareholders Fund
30
20
10
0
2010 2011 2012 2013 2014

Profitability, Dividend, Performance and Liquidity Ratios
Net Profit Before Tax Price Earnings Ratio (Times)
(Million Taka)
11,911
13.29
11,075
10,347
12.21
12.35
10,532
11.24
11.27
8,455
2010 2011 2012 2013 2014

2010 2011 2012 2013 2014
Current Ratio (Times) Return on Capital Employed

1.16
1.14
19%
1.09
1.09
1.08
17%
13%
11%
9%
2010 2011 2012 2013 2014 2010 2011 2012 2013 2014
Investment to Deposit Ratio (IDR) Cost to Income Ratio

(Per Taka)
87.29%
90.1%
85.18%
0.76
82.35%
0.75
0.73
0.72
0.74
79.88%
2010 2011 2012 2013 2014 2010 2011 2012 2013 2014
Capital Adequecy Ratio (%) Debt Equity Ratio (times)

14.26%
13.49%
13.09%
12.83%
11.06%
4.77
5.34
4.20
4.62
4.03
2010 2011 2012 2013 2014 2010 2011 2012 2013 2014

Statement of Value Added
(In million Taka)
Income from Banking Service 58,046 56,118
Less: Cost of Services 33,339 33,436
Value added by Banking Service 24,701 22,682
Non-Banking Income - -
Provision for Investment & Off-Balance Sheet exposures 4,791 3,029
Total Value Added 19,916 19,653
Distribution of Value Addition
To government (income tax) 6,323 6,146
To providers of capital (dividend- cash/stock) 2,415 2,635
To employees (salaries, allowances and other benefits 8,191 7,545
Zakat 426 386
Expansion and growth
Retained by the entity 1,584 2,339
Depreciation 768 646
Deferred taxation 209 (44)
Total 19,916 19,653
Distribution of Value Addition-2014 Distribution of Value Addition-2013
Salary & Allowances 3% Salary & Allowances

2%
2%
8% 4% Income Tax paid to Government 12%
Income Tax paid to Government
38%
12%
42%
General Reserve & Dividend 13% General Reserve & Dividend
Retained Profit Retained Profit
32% Depreciation 32% Depreciation
Zakat Zakat

Integrated Reporting

Financial Inclusion
Total Customers 9,587,458 8,538,969
Rural Investment extended through Rural Development Scheme (RDS) (Million Taka) 17,380 13,731
Number of RDS members 911,470 836,227
Villages of the country covering through RDS 18,086 17,104
Farmers Account (Nos.) 624,93 615,979
Percentage of Rural Branch 23.81% 27.27%
Deposit per Account (Million Taka) 0.058 0.055
Investment per Account (Million Taka) 0.552 0.485
SME exposure of IBBL to Total Investment Portfolio 42% 41%
Spread 4.27% 3.79%
Tackling Financial Crime
Staffs completed training on Anti Money Laundering (AML) 1,425 2,183
Suspicious Transaction reported to Bangladesh Bank 42 19
Promoting Sustainable finance (In million Taka)
Amount financed for installation of ETP to plants in operations 43.6 35
Amount financed in plants having ETP 34,684 39,642
Amount financed to solar panel/renewable energy plants 108 118
Amount financed to Bio-fertilizer plants 0.10 1.70
Amount financed to brick kilns adopted cleaner technology 2,257 2,270
Amount financed to other green projects 2,789 2,390
Total Sustainable Finance 39,838 44,456
Employer of Choice
Total Employee 13,574 12,980
Percentage of voluntary attrition 20 8
Number of employee received training 8,821 8299
Total number of training 436 387
Percentage of employee received training 65% 64%
Number of fresh employee recruited 870 870
Protecting Environment
Number of customers eligible for Environmental Due Diligence 1,733 4,428
Number of customers appraised for Environmental Risk Rating 1,518 4,107
Low 1,155 2,751
Moderate 319 1,319
High 44 37
Cost of water consumed by the bank (Million Taka) 8.52 10.35


Cost of Paper consumed by the Bank (Million Taka) 75.68 194.64
Cost of energy (electricity, fuel and gas) consumed by the Bank (Million Taka) 215.01 260.44
Percentage of bank branches connected online 100% 100%
No. of staff received training on Green Banking 5,089 4,934
Distribution of Tree Saplings 723,672 607,627
Corporate Social Responsibility
Expenditure for CSR (Million Taka) 525 476
No. of Beneficiaries 1,355,520 950,607
Contribution to the National Exchequer in 2014 (Million Taka) 11,465 10,963
Contribution to National Exchequer time deducting from employees’ salary as well as customers
and vendors’ invoice. IBBL is the highest Corporate Taxpayer
IBBL regularly pays corporate tax on time. The Bank paying on the Banking Sector and is the second highest among all
excise duty, withholding tax and VAT to Govt. exchequer on the taxpayers including foreign taxpayers in Bangladesh.
(In million Taka)
Sl. Particulars During 2014 Total up to
No. 2014
1 Corporate Tax 4,414 37,086
2 AIT on PPD 3,774 18,370
3 Tax Deducted at Sources 1,323 5,766
4 Value Added Tax (VAT) 639 3,066
5 Excise Duty 1,193 6,891
6 Income tax Payment by the Employees 122 471
7 Total 11,465 71,650
Economic Value Added Statement

(In million Taka)
Shareholders’ equity 46,613 43,785
Add: Accumulated provision for investment (including Off B/S) 18,108 13,547
Total Invested Fund 64,721 57,332
Average Shareholders’ Equity 61,027 54,102
Earnings
Profit After Tax 3,999 4,973
Add: Provisions 4,791 3,029
Less: Written-off during the year (148) (604)
Earnings for the year 8,642 7,398
Cost of equity 5.18% 6.02%
Capital charges 3,161 3,257
Economic Value Added (EVA) 5,481 4,141

Market Value Added Statement
Amount
Particulars Number of Shares Value per Share (Taka)
(Million Taka)
Market Value 1,609,990,668 23.40 37,673.78
Book Value 1,609,990,668 28.95 46,609.23
Market Value Added - - (8,935.45)
Market Share Information
Particulars Market Share of IBBL in the Banking Sector (%)

Serial No.
2014 2013
1 Deposit 8.53 8.15
2 General Investment 8.78 8.75
3 Import 9.78 9.93
4 Export 10.07 10.19
5 Remittance 25.53 26.67
Market Price at DSE in 2014
(In Taka)
Market Price at CSE in 2014

(In Taka)

Financial Calendar
Financial Calendar-2014
Items Date
Dividend for 2013 paid (Stock-June 05, 2014, cash-June 09, 2014) May 30, 2014
Financial Statements for the year 2014 signed March 21, 2015
32nd Annual General Meeting to be held June 13, 2015
Dividend for 2014 proposed to be paid June 30, 2015
Interim Financial Statements
1st quarter ended March 31, 2014 (unaudited) approved by the Board of Directors May 11, 2014
2nd quarter/Half Yearly ended June 30, 2014 (unaudited) approved by the Board of Directors July 17, 2014
3rd quarter ended September 30, 2014 (unaudited) approved by the Board of Directors October 25, 2014
4th quarter/Year ended December 31, 2014 (audited) approved by the Board of Directors March 21, 2015
Financial Calendar-2015 (Proposed)

Items Date
Financial Statements for the year 2015 will be finalized and signed February 27, 2016
33rd Annual General Meeting will be held March 31, 2016
Dividend for 2015 proposed to be paid April 17, 2016
Interim Financial Statements
1st quarter ended March 31, 2015 (unaudited) will be approved by the Board of Directors May 09, 2015
2nd quarter/Half Yearly ended June 30, 2015 (unaudited) will be approved by the Board of Directors July 10, 2015
3rd quarter ended September 30, 2015 (unaudited) will be approved by the Board of Directors October 13, 2015
4th quarter/Year ended December 31,2015 (audited) will be approved by the Board of Directors February 27, 2016

Financial Highlights
(In million Taka)
Sl.
No. Particulars 2014 2013
1 Paid-up Capital 16,099.91 14,636.28

2 Total Eligible Capital 48,569.86 45,487.38
3 Capital Surplus 10,695.59 13,599.40
4 Total Assets (Excluding contra) 652,422.04 547,229.63
5 Total Deposits 560,696.30 473,140.96
6 Total Investments (excluding Investment
463,475.47 403,194.80
in Shares/ Securities)
7 Total Contingent Liabilities and Commitments 112,819.23 113,715.58
8 Investment Deposit Ratio 79.88% 82.35%
9 Classified Investment to Total Investments 4.92% 3.71%
10 Profit after Tax & Provision 3,999.06 4,948.58
11 Classified Investment during current year 7865.34 729.10
12 Provision kept against Classified Investments 13,354.72 9,037.80
13 Provision Surplus 0.18 0.75
14 Cost of Fund 8.55% 9.45%
15 Profit Earning Assets 506,579.98 421,982.74
16 Non-Profit Earning Assets 145,842.06 125,246.89
17 Return on Investments 9.86% 11.53%
18 Return on Assets 0.67% 0.96%
19 Income from Investments 51,010.20 50,192.98
20 Earnings per Share (Taka) 2.48 3.07
21 Net Income per Share (Taka) 2.48 3.07
22 Price Earning Ratio (Times) 11.24 12.35
23 Net Asset Value (NAV) 46,612.81 43,760.68
24 Net Asset Value (NAV) Per Share 28.95 27.18
25 Net Operating Cash Flow Per Share (NOCFPS) 29.52 21.44
26 Dividend Yield Per Share 6.41% 5.20%
27 Dividend Payout Ratio Per Share 60.39% 53.24%
28 Dividend Cover Ratio (Times) 2.75 3.07
29 Operating Profit as % working fund 3.13% 3.30%

Five Years Performance
(In million Taka)
Sl. Particulars 2010 2011 2012 2013 2014
Balance Sheet (Financial Position)
1 Authorized Capital 10,000.00 20,000.00 20,000.00 20,000.00 20,000.00
2 Paid up Capital 7,413.12 10,007.71 12,509.64 14,636.28 16,099.91
3 Share Premium 1.99 1.99 1.99 1.99 1.99
4 Reserve Fund 16,081.14 17,792.50 24,116.47 26,512.48 28,.097.92
5 Retained Earnings 2,594.59 3,202.47 3,152.25 2,634.53 2,414.99
6 Shareholders’ Equity 28,400.03 33,716.73 39,780.35 43,760.68 46,612.81
7 Deposits (including Bills Payable) 291,934.60 341,853.67 417,844.14 473,140.96 560,696.30
Investments (including Investment in Shares
8 275,493.94 322,772.83 399,930.79 474,015.95 564,332.00
and Securities)
Investments (excluding Investment in Shares
9 263,225.13 305,840.56 372,920.72 403,194.80 463,475.47
and Securities)
Investment Deposit Ratio (as per BB guide-
10 90.17% 89.47% 85.18% 82.35% 79,88%
lines)
11 Total Assets (including Contra) 443,684.79 502,613.05 592,580.50 664,554.96 765,241.27
12 Total Assets (excluding Contra) 330,586.12 389,192.12 482,536.32 547,229.63 652,422.04
13 Fixed Assets 6,748.44 7,100.19 14,808.23 15,732.81 15,926.36
Capital Measures
14 Total Risk Weighted Assets (RWA) 256,804.90 257,564,30 311,511.60 319,215.90 378,742.72
15 Crore Capital- Tier- I 18,559.80 23,401.24 28,249.95 32,222.40 35,025.95
16 Suplementary Capital (Tier- II) 9,840.20 10,315.49 13,803.20 13,189.60 13,543.92
17 Regulatory Capital (Tier I, II & III) 28,400.00 33,716.73 42,053.16 45,487.38 48,569.86
Statutory Capital (Paid up Capital & Statutory
18 15,348.08 20,012.14 24,933.30 29,274.89 32,199.82
Reserve)
19 Equity/Capital Surplus/Deficit 5,287.58 7,960.24 10,901.96 13,599.40 10,695.59
20 Capital Adequacy Ratio 11.06% 13.09% 13.49% 14.26% 12.83%
Assets Quality
21 Classified Investment 4,655.63 8,292.32 14,212.80 14,941.9 22,807.24
22 Classified Investment to Total Investment 1.77% 2.71% 3.81% 3.71% 4.92%
23 Provision against Classified Investment 1,840.00 3,054.00 6,054.35 9,037.80 13,354.72
General Provision against Unclassified
24 3,443.00 3,996.00 3,935.90 3,371.60 3,625.48
Investment
25 General Provision on Off Balance Sheet Items 930.00 1,120.00 1,100.45 1,137.20 1,128.20

Five Years Performance
(In million Taka)

Sl. Particulars 2010 2011 2012 2013 2014
Operating Performance (Income Statement)

26 Investment Income 24,766.26 32,019.53 43,672.23 48,145.46 49,109.96
27 Profit Paid on deposit 14,471.89 18,401.22 25,870.43 30,975.19 30,650.27
28 Net Investment Income 10,294.37 13,618.31 17,801.80 17,170.27 18,459.69
29 Non-Investment Income 5,362.64 6,381.76 6,345.56 7,972.88 8,937.07
30 Total Income 30,128.90 38,401.29 50,017.79 56,093.75 58,047.03
31 Administrative & other Exp. 7,202.31 9,652.76 8,724.65 11,039.15 12,074.13
32 Total Expenditure Excluding Provision 21,674.20 28,053.98 34,595.09 42,014.33 42,724.40
Provision for Investment, Off Balance Sheet
33 1,114.99 2,384.31 3,512.07 3,029.26 4,790.91
Items & Other Assets
34 Total Expenditure Including Provision 21,674.20 28,053.98 38,107.16 45,043.59 47,515.31
35 Net Profit before Tax 8,454.71 10,347.31 11,910.65 11,074.76 10,531.71
36 Net Profit after Tax 4,463.47 4,841.45 5,338.91 4,948.58 3,999.06
37 Provision for Income Tax 4,108.98 5,515.56 6,571.74 6,101.57 6532.65
38 Import 246,281.00 301,207.00 284,588.00 285,890.00 316,971.00
39 Export 148,421.00 178,244.00 197,095.00 205,269.00 222,753.00
40 Remittance 214,629.00 236,607.00 300,915.00 286,956.00 308,722.00
41 Total Foreign Exchange Business 609,331.00 716,058.00 782,598.00 778,115.00 848,447.00
Distribution Network
42 Number of Correspondent Banks 295 313 320 331 597
43 Number of Foreign Correspondents 919 935 676 690 723
44 Number of Shareholders 58,923 60,550 60,302 62,772 60,857
45 Number of Employees 10,349 11,465 12,188 12,980 13,574
46 Number of Branches 251* 266* 276* 286* 294*
Shareholders’ Information
47 Cash Dividend - 7% 8% 8% 15%
48 Stock Dividend 35% 25% 17% 10% -
49 Net Assets Value (NAV) per Share (Taka) 23.48 27.78 27.18 27.18 28.95
50 Earning per Share (Taka) (original) 6.02 4.84 4.42 3.40 2.48
51 Earning per Share (Taka) (restated) 3.57 3.87 3.65 3.07 2.48
52 Market Value per Share (Taka) (Highest) 90.00 83.98 59.00 45.00 36.80
Efficiency Ratio
53 Gross Profit Ratio 51.97% 52.08% 48.28% 44.80% 47.20%
54 Cost of Fund 8.65% 8.86% 9.32% 9.45% 8.55%
55 Cost Income Ratio ( Per Taka) 0.72 0.73 0.76 0.75 0.74
56 Return on Equity (ROE) 19.00% 17.42% 13.42% 11.36% 8.85%
57 Return on Assets (ROA) 1.47% 1.35% 1.27% 0.96% 0.67%
58 Price Earning Ratio (Times) 13.29 11.27 12.21 12.35 11.24
59 Spread 4.87% 4.03% 4.10% 3.79% 4.27%
* Including 30 SME/Agriculture Branches

Media Highlights

Publications

Success Story
Halima has become an Employer of 400 workers
Halima Khatun could have pursued a career commensurate hindrance arose is adequate capital for a countable start-
to her better and a bit higher educational career. But instead up. She started looking out for a fund from local banks
of looking for a job she had a long mindset to rather create and investment funders. But she failed in her quest getting
jobs for others, especially helpless women. An investment poor response from lenders who were not interested in
from Islami Bank Bangladesh Limited has made her dream such a non-traditional craft. She then went to Islami Bank’s
true. As an SME investment client she is now a catchword Kumarkhali Branch. The branch carried out feasibility study
for referring to success beyond Kumarkhali of Kushtia. of the proposal from different dimensions and subsequently
came to invest a fund of Tk.3,50,000/- (US$ 4,500) in 2011
When she was too minor she would often think of doing under Women Entrepreneur Development Scheme.
something special and appreciable. This vision found a new
dimension when her eyes opened wide to the world outside This marked the beginning of her success story. From
home confinement. Her husband came out in support of her the same year she started supplying her fashion wears
quest for learning needle-works (Karchupi Kaj) on maiden to neighboring districts. As of now, her enterprise runs an
fashion wears. investment to the tune of Tk.9,00,000/-( US$ 11570 almost).
She now employs 400 women workers along with a male
Her own earning, that contributed to her family, started marketing team of six. Success has marked not only in
from those exclusive needle-works since 2005. She started quality, it implied in quantity as well. She is set on an
organizing the neighboring poor widows and women arduous plan of supplying in bulk to the capital city Dhaka
suspended in worst economic condition to engage them in
and other remote marketplaces across the country. Taking
similar works. With their active hands got together she started
care of her family she has chalked out her day’s work that
getting stitching works on contractual production-sharing on
need her intensive insight and attention to all that concerns
weekly basis. Soon after she started her hand-crafted fashion
her business - ranging from raw material outsourcing to
decorations through needle-works especially on bridal sharee,
fashion ideas, comparative market analysis, outsourcing of
design sharee, fancy sharee, urna (scarf), lehenga, 3-piece,
accessories and patterns, human resource factors and all
punjabi and embroidered quilts which spread its popularity
widely among fashion lovers of the locality. other details. Her business now calls for modern computer-
aided fusion and pattern designing, samplings and other
Such popularity ignited her passion and commitment to precision works. She is planning to arrange for these vital
open up her own and exclusive factory in 2009. The only and advanced gadgets for her business.

Success Story
Besides own benefit of business, she has a mindset of and a sustainable career in craftsmanship. Her fashion-
some allied objectives including employment generation, wear factory and showroom are often visited by high profile
especially among the less-advantaged and helpless rural dignitaries who all expressed their high note of satisfaction
women to empower them for earning an honorable income on the quality of work and her passion for high esteem.
Lovely Begum Honored with

District’s Best Farmer Award
An Inspiring lady Lovely Begum of Chinishpur Village of transaction qualified herself to take investment for eight
Narsingdi has demonstrated an exemplary ‘ Win by Struggle. times and reach to the larger investment of Tk.60,000/-.
An investment and simultaneously training under Islami
Bank’s RDS program has brought in a great change in her She started taking lease of land with the expansion and
life. She became the village’s role model, inspiring other diversification of her projects for cultivation. Her success
maiden dreams for contributing to their families. By a hectic pleased the Narsingdi District Agricultural Extension
day’s end, a smiling dining together with her family members Department so much that they honored her with the
brings a paradise fallen on earth. “Alhamdulillah”, as she ‘District’s Best Farmer Award’. Later she was sent off to
always says, “I could not come out of the grip of poverty, China for taking an advanced training on farming. Back
unless I would have been trusted with an IBBL investment.” home, she devoted all her skill and experience in cultivating
vegetables and various seasonal crops.
Lovely’s life was like other rural housewives who hustle to
Lovely Begum is a glaring example of how Islami Bank’s
managing their home, cattle rearing, cooking and other farm
micro-investment support has brought such a life changing
works. She has been involved in agricultural work for last
impact on the lives of rural people, especially women. She
ten years. However, she has no cultivable land which bound
has raised two semi-constructed living rooms, bought a
her to depend on bodily labor in the field that too remained
husking and an irrigation pump. She has brought a family
scarce other than crop seasons.
from the morass of poverty to greater self-reliance and self-
She became a member of RDS in 1996 and initially got an esteem. She offered her experience and achievement to
investment of Tk.5000/-(US$ 65.00). Her record of good other female entrepreneurs of and even outside Narsingdi.

Success Story
Tayubur from Beggar to

Self-Dependent
Physical challenge can be won if and when mental spirit and came forward with a sanction. Beggar Tayubur is now
advances triumphant. This was once again proved in well-off, thanks to Islami Bank’s scheme that befitted his
Tayubur’s case. With his impaired health he had to choose condition.
virtually a beggar’s life to feed a family of six – including
his aging and elderly mother, wife and three children. But “Running an auto-rickshaw driven by battery was still
begging has all along been against his wish and taste, who permissible,” said Tayubur and “it gave me a scope to earn
always dreamt of any means for a living without begging – by driving it even though I was at handicapped.” He can
to live and let his dependants live with a dignified identity in no longer drive it by himself as authorities don’t allow a
the society. physically challenged person to drive a vehicle in Dhaka. So
he let it run in the outskirts of Dhaka on sharing basis, where
Tayubur Rahman learnt that Islami Bank has a programme battery-driven vehicles are allowed. A modest earning from
to rehabilitate the destitute. So he applied for an assistance share driving of his auto is now adequate to run his family.
and his situation met a lenient consideration. He applied to Most importantly it has exonerated him from begging, a life
provide himself with an auto-rickshaw. Bank stood by him he hated most.

Success Story
China Habib’s Ponds are the Sources of

Nutrition of Dashara Village
East Dashara village in Manikganj Sadar Upazila recently She got more water bodies leased in, prepared them and
witnessed an event that kept inquirers and development applied for an investment of Tk.50, 000. With investment
activists shuttling the quiet village in frequent propensity. looming and her interest heightening with no-look-back
And the event was all about a village homemaker known intensity, she qualified for another investment of Tk.1.00 lac.
typically by China Habib. From childhood she was unlike a Today, her one-pond-project has been expanded into a huge
village girl languishing for fancy for lamenting for high life. patch with 5 large ponds, fetching her average annual catch
What she always looked for, was making sense of enterprise worth 5 tones of fish that includes various carps in addition
and creating scope for an earning with dignity. She found to traditionally lucrative ruhi and katla variety.
ponds and small water bodies lay unutilized. She planned
for cultivating fish in those water bodies. But the key China Habib now plans to expand her cultivation to newer
impediment stood with funds. heights, engaging more workers and leasing in more ponds.
She runs an MSS account with Islami Bank and had her
China rushed to get a membership of Rural Development homestead rebuilt from thatched to concrete, digging her
Scheme of IBBL. Initially, she was granted a small investment own tube well, and sanitary latrine. She often is heard of
of Tk.15, 000. She bought fish fries and let them breed in a consigning all tributes and care from Islami Bank for her
small pond. At early attempts she could account for profit. cherished life.

Success Story
RDS Changed the Steering of

Laxmi Rani’s Life
For generations Luxmi Rani’s and also her husband’s family success the investment kept increasing from Tk. 8000.00 to
lived with wooden crafts in a village which is situated in a Tk.1,00,000 /- (US$. 1300). Now the whole-sellers come to
walking distance of Munshigonj branch of IBBL. She added her house for purchasing her products.
to it a new dimension with the investment of RDS. Laxmi
Rani is an Artisan. She used to buy wood from saw mills, Luxmi Rani provided her son all that he needed to complete
dried it for a little seasoning and, together, they produced his study in medicine; got him married and she too was sent
utensils and sold them to the whole sellers. They were hardly off to college. “I told my daughter-in-law to continue with
manage their family with the little amount of money they Islami Bank for it was the spell of my fortune”, said Luxmi.
earn. By the way her son talked with an RDS official and
She now runs two accounts, one for the RDS investment and
requested him to visit their home crafts of wooden utensils
and small utilities. the other for her personal monthly savings (MSS). Many is
her neighborhood followed her and that adds to her smile as
After visiting Laxmi Rani’s home by fellow of RDS, she started the forerunner towards self-reliance.
to deposit of Tk.25/- per month which was the beginning of
A proud Luxmi’s identity of a wood maker has gradually
the change she made both to her enterprise and her family
receded to oblivion; as she is more known as a doctor’s
of four members. An RDS investment of Islami Bank initially
mother. “ All that I could do” takes it tribute to Islami Bank,
for Tk.8, 000 (US$. 105) changed the steering of her life.
who not only gave me investment, often inquired my well-
For building sufficient stock, she started buying timber
being and gave advices that I didn’t know, “ a grateful Luxmi
that reduced her raw materials cost. She started selling the
is often quoted as sharing smilingly with visitors and vendors
goods to Jinjira and other local bazaars. Satisfied upon her
about the cooperation IBBL extended to her initiative.

Success Story
Timber Trader Loknath has become

a Model Entrepreneur
A glare of dreamy future would always radiate from the they started importing wherein they passed a difficult time
young Loknath, more so as he completed graduation from due to lack of capital. 1996 was the turning point for them
the prestigious Victoria College of Comilla. A bash new as they entered as a member of the Islami Bank’s Bashurhat
world seemed to have unfolded to him. But unlike chasing branch. They started business with a modest fund of Tk.0.15
a career, Lokanath turned back to his root in Bashurhat, million from IBBL to procure timber. Loknath passionately
Companyganj. Side by side with assuming the leadership of showed their craftsmanship with service and commitment
a dwindling family business, he started teaching profession to business. They imported timber from many countries
for roughly three years, for he did not like to be a burden to including Myanmar, Nigeria, Suriname, Cameroon, Vietnam,
the family. He had an in-born instinct in enterprise. and Liberia. They sold their timber all over the country.
Loknath Bhowmik is now the chief of their timber dynasty - Presently, they are availing a limit of Tk.750.00 million.
M/s Popular Export & Import Company (Pvt) Limited being Their company now ranks leading in the country in timber
its chairman. They have settled their six brothers and sisters business, employing nearly 200 skilled workers and staff.
to dignity. Loknath and his family is grateful to Islami Bank,
and according to Arabinda Bhowmik, company’s MD, Islami The Bhowmiks have diverted their enterprise to agro industry
Bank has helped them fulfill their dream. (Luna Agro) and Fuel Wood (Akash Briquetting Limited)
with equal seriousness. A remote outback called Bashurhat,
Loknath Bhowmik is just an ensemble of successful Noakhali, is known otherwise by this timber company. Getting
entrepreneur. He has developed this family enterprise from Islami Bank by their side, they say, “it was like taking aside
1980s. But the enterprise dates back to 1950s. From 2002 along a mountain that safeguards, protects and provides.”

Success Story
Nurjahan is the Savior of

Her Disabled Spouse
Nurjahan Begun is a lady of vision, honesty, hard work and self hand work in each work made her products popular and
confidence. Like many other less advantaged family living in customer’s demand persuaded shop to buy her clothes.
the country side with practically no access to basic needs,
sustainable income and resource, Nurjahan’s destiny was At a point she took an investment of Tk.50,000 (US$ 650). She
almost certain to live an impoverished life. Her husband is a now owns a factory-cum-showroom in a busy marketplace
day laborer. Whatever her husband earned was too inadequate of Jamalpur, employing 10 workers. She gives emphasis on
to provide for two square meals and coarse loin. In addition to hard training women for making quality fashion wear and
that they had no earning at off seasons. However, Nuvrjahan’s handicrafts. With the increase of business, she now runs
spirit did not diminish. She rather took a vow in silence and her personal savings as well. Her shop fetches her a modest
looked around for a scope to strike on an occasion to break average income of Tk.20,000 /- per month, adequate to bring
through the vicious cycle of a perennial poverty. One day the smile on the faces she cares at home and works outside for.
opportunity really struck. She heard about Islami Bank. She
Her successful entrepreneurship has brought new hope
reached to Islami Bank’s Jamalpur Branch and became a
and aspiration for a brighter future. Nurjahan’s two children
member of its Rural Development Scheme.
afford to avail themselves better education. She is a
The first investment of BDT 5000/- (US$ 65) was a modest fantastic example of how destitute friendly microfinance of
beginning for her fate-changing enterprise of handicraft IBBL brought such escalating impact on the lives of women
making and readymade clothes. Her husband helped her in rural Bangladesh. With sincerity and hard work she is
to sold them to cloth shops and fashion outlets. At first it providing a sustainable life for herself, her husband and her
was quite hand for her to convince the shop-owners. But children. Often she comes in reference to self esteem and
reasonable price tags with admirable quality and decent success earned through hard labor and enterprising tenacity.

Success Story
IBBL Stipend Made Shathi Accident struck Asma

an Icon of Brilliance Ensured her Dignity with
Morning really showed the
IBBL Assistance
day. A little girl was taking
everybody by surprise with Happiness endured for a little
her talent from pre-school in Asma’s life. Her happy family
age. Father, Mohammad with husband and children
Shaban Ali, earned a struggling met a series of shocks and
livelihood pulling rickshaw in turbulence that came in a
Gazi Haridanga, Paikgachha, row. First, accident struck
Khulna. With wife struggling with burning of their shop, the
even more and four children only source of income. Danger
perishing under acute poverty, befell on this happy family.
Shaban Ali could not even dream to send his children to Asma’s husband looked out
for a job and nothing came
school. But Sathis’s talent could hardly be stopped. She
out even his frantic search for
own in amazing brilliance in primary and came out with
an earning. Then he started learning driving and somehow
GPA 5 in HSC from Luxmikhola Collegiate school in 2013.
managed a driving license. But again misfortune made a
She defied poverty, won impoverishment and sidelined even
sudden unwelcome visit to this impoverished family. While
the slightest chance of being a dropout. And the propitious
driving he met an accident of fatal proportion and the sky fell
moment arrived when she admitted at International down on Asma’s head. She has to carry on both feeding the
Relations in the University of Dhaka. family and provide for medical care for her husband. Such
Sathi could enter in the Oxford of the East, entirely by her an unbearable load made her puzzled and she literally was
about to give up.
own merit, but didn’t know how to survive in the capital city
where living and carrying on education appeared unbearably Prolonged treatment, supported also by her passionate
expensive for her. So she survived on private tutoring relatives, could save her husband’s life, but could not make
elsewhere, but that too, proved inadequate. She was then him able to work as a normal person. Now he works as a
advised to apply for a stipend of Islami Bank Bangladesh temporary bus-conductor, but his little earning is quite
Limited. Bank found both merit and potential in granting her futile for meeting the family’s day-to-day needs. Their four
a 4-year education benevolence package. Now she is the children go to school and that too accounts for a regular and
happiest student in that she can devote herself entirely in compulsive spending.
education. “I took myself this far,” says Sathi, “but the rest
Asma applied for a sewing machine to IBBL, being advised
remained uncertain and Islami Bank’s stipend ensured my by neighbors. Islami Bank granted her a sewing machine
education, fulfilled my dream.” She literally started weeping that helped turn her life upside down, making remarkable
in acknowledging her and her family’s gratitude to Islami change for a sustainable livelihood. It also gave her a sense
Bank. The boats behind always follow the leading cruise. of dignity in terms of earning honorably for a living. It could
Sathi has become an icon to her other brothers and sisters, not bring her fortune back, but made her life worth living for,
even her neighbors and friends left at the remote Gazi with sense of self-esteem and dignity.
Haridanga village in Paikgacha.

Report of the Shariàh Supervisory Committee
During the year 2014 the Shariàh Supervisory Committee met in different meetings and reviewed different operational activities
of the Bank, including those referred to it by the Board of Directors and the Management of the Bank, and gave opinions and
decisions related to Shariàh. The Honourable members of the Shariàh Supervisory Committee attended 8 Seminars organized by
the Management of the Bank on the eve of inauguration of new branches and 18 Shariàh Awareness Programs arranged by the
Head Office and different Zones. Apart from this, the Shariàh Secretariat conducted Shariàh inspection at 286 branches during
the period excluding 8 new branches of the Bank opened in 2014 and submitted detailed report thereon.
The duty of the Shariàh Supervisory Committee is to give independent opinion and necessary guidelines upon observing and
reviewing the activities of the Bank and the responsibility of the Bank is to ensure that the Bank conducts its business in accordance
with the rules and principles of Islamic Shariàh.
The Shariàh Supervisory Committee, after reviewing the Shariàh inspection reports, audited reports i.e. Balance Sheet, Profit &
Loss Accounts and other financial statements of the Bank for the year 2014, gives the following opinions:
1. The agreements of investments and transactions executed by Islami Bank Bangladesh Limited during the year have
been made in accordance with the principles of Islamic Shariàh. However some exceptions have been observed at the
implementation level as per Shariàh inspection report.
2. Profit distributed to deposit accounts has been made in accordance with Islamic Shariàh.
3. The income detected as doubtful as per Principles and Rules of Islamic Shariàh has not been included in the distributable
income of the Bank.
4. The calculation of Zakat on the Zakatable asset of the Bank has been made in compliance with the rules and the
principles of Islamic Shariàh. It is pertinent to state that Islami Bank does not pay Zakat on behalf of the depositors
and Shareholders. It is the responsibility of the Depositors and Shareholders to pay Zakat on their deposits and shares
respectively.
5. It is necessary to provide more Shariàh training to the employees of the Bank and arrange more Shariàh Awareness
Programs to make the clients aware regarding Shariàh compliance.
6. The Rural Development Scheme (RDS) is a praiseworthy effort of IBBL for the welfare of the poor people of the country.
It is essential to take effective precautionary measures for ensuring Shariàh compliance in this respect.
7. Different steps for improving Shariàh Compliance like motivational programs, administrative measures and intensive
supervision to be strengthened by the management.
8. Islami Bank Bangladesh Limited is playing an appreciable role in the field of education, health and other welfare activities
apart from the banking operations. Such kind of programs should be expanded.
May Allah (SWT) bestow us with the best of Tawfique in gaining His satisfaction through implementing Shariàh in every spheres
of our life. Ameen.
Sheikh Moulana Mohammad Qutubuddin Professor Dr. Abu Bakr Rafique

Chairman Member Secretary

Audit Committee Report
In compliance with the Bank Company Act 1991 (as specifically shareholders, depositors and the society as a
amended up to 2013) and Bangladesh Bank BRPD Circular whole. In this context, the Audit Committee comprising of
No. 11 dated 27 October 2013 the formal Audit Committee 4(four) members has been appointed by the Bank’s Board
of IBBL has been functioning duly appointed by the of Directors. Pursuant to the instructions of the Bangladesh
Bank’s Board of Directors to assist the Board for ensuring Securities and Exchange Commission and the Bangladesh
the achievement of objectives of the Bank, efficiency Bank, 03 (three) Independent Directors have been included
of operations and compliance with the applicable laws, in the Committee. As per Bangladesh Bank Circular, no
regulations and internal policies to make the Bank a unique, member of the Executive Committee has been included in
strong and dependable organization for all stakeholders the Audit Committee.
Composition of the Audit Committee
Status in the Board of Status in the Audit

Sl. No. Name
Directors Committee
1. Professor NRM Borhan Uddin, Ph.D. Independent Director Chairman
2. Dr. Areef Suleman Director Member
3. Janab Md. Abdus Salam, FCA, FCS Independent Director Member
4. Barrister Mohammed Belayet Hossain Independent Director Member
As per regulatory guidelines, Janab Abu Reza Md. Yeahia, Company Secretary of IBBL acts as the Secretary of the Audit Committee.

Statement of the Audit Committee 5. Examined whether the findings and

recommendations made by the internal auditors
The Audit Committee during its regular review observed that & external auditors are duly considered by the
the internal controls of the Bank are okay. However, qualified management or not.
& competent Personnel, particularly at the ‘Divisional Head’
level, are yet to be in place 6. Evaluated whether the internal audit functions
have been conducted independently from the
The committee also during its regular review of the external management.
audit functions, observed that effective co-ordination of
external audit function, independence of external auditors 7. Reviewed the Manual of Internal Control &
were ensured and the external auditors’ findings were Compliance. Evaluated the Management
reviewed in order to be satisfied that appropriate actions Information System (MIS) to ensure appropriate
have been taken. computerization system and its uses.
8. Approved the Audit Calendar for the period under
Meeting of the Audit Committee review and advised to carry out the audit program
meticulously.
During the year 2014, the Audit Committee of the Bank
9. Reviewed the financial statements to ensure that
organized 24 (twenty four) meetings. Proceedings of
these financial statements are in full compliance
the Audit Committee meetings were reported timely and
with the Acts, Rules and the Accounting Standards
regularly to the Board of Directors as well as Bangladesh
(BAS/BFRS)
Bank to comply the Bangladesh Bank DOS circular letter no.
07 dated 24.04.2011. 10. Evaluated the Management Information System
(MIS) and advised to audit Bank’s Software
During the period, the Committee performed, amongst (eIBS) by external software Audit Firm to ensure
others, the following key functions, where applicable, to the appropriate automation system & its uses; and
extent it was brought before the Committee. also to hire IT Experts ASAP.
11. Discussed the Bangladesh Bank inspection reports
1. Discussed the internal and external audit reports on the Branches and Head office and advised the
and advised the management to rectify all lapses management to rectify all lapses and to comply
revealed in the reports. Additionally from time to with Bangladesh Bank’s instructions & circulars
time the concerned Head of Wings/Divisions/ meticulously.
Branches and other officers including the
Managing Director of the Bank were invited to 12. Reviewed the Self-Assessment of Anti Fraud
attend the meetings of the Audit Committee in Internal Control on quarterly basis for onward
order to augment the process of regularization of submission to Bangladesh Bank in compliance
lapses and irregularities with DOS circular letter no. 17 dated 07.11.2012.
13. Advised the management to complete all the
2. Assessed reports relating to fraud, forgery, documentation formalities carefully and retain
deficiencies in internal control or other similar each and every document properly.
issues detected by internal and external auditors
and inspectors of the regulatory authority and 14. Reviewed the reports on overdue, classified,
placed the same before the Board after reviewing rescheduled & written off investment and other
whether necessary corrective measures have been non-performing assets and directed to exert all-out
taken by the management. efforts to reduce non-performing assets.
3. Evaluated the compliance culture across the Bank. 15. Reviewed the reports on income leakage (i.e.
unrealized commission) to increase the Bank’s
4. Reviewed the activities of the internal audit and profit & to take preventive measures for not to
the organizational structure and ensured that no increase the income leakage.
unjustified restriction or limitation hinders the
internal audit process and examined the efficiency 16. Suggested to take up the matters with concerned
and effectiveness of internal audit functions. lawyers for early disposal of the suits for recovery
of the Bank’s dues.

17. Advised the management to ensure full compliance Review of Financial Statements of 2014
of regulatory issues.
The Audit Committee, reviewed and examined the Annual
18. Advised the management to ensure full shari’ah Financial Statements of the Bank to confirm whether
compliance in all areas of business. all the required disclosures and information have been
19. Suggested some measures, including hiring more incorporated in the Financial Statements following
professional Accountants, for capacity building of International Accounting Standards (IAS) and International
the internal auditors and to further strengthen the Financial Reporting Standards (IFRS) adopted as
internal audit functions. Bangladesh Accounting Standards(BAS) and Bangladesh
Financial Reporting Standards(BFRS) respectively by the
20. Reviewed the stress testing procedure and Health Institute of Chartered Accountants of Bangladesh, Bank
of the Bank in respect of all areas of business. Company Act 1991(as amended up to 2013), Bangladesh
Bank Guidelines, the Companies Act 1994, the Bangladesh
21. Reviewed whether the laws and regulations framed Securities and Exchange Commission Rules 1987 and other
by the regulatory authorities (central Bank and laws and rules applicable in Bangladesh and also Standards
other bodies) and internal regulations approved by issued by the Accounting and Auditing Organization for
the Board are being complied with. Islamic Financial Institutions (AAOIFI), Bahrain, etc. The
Committee recommended the Financial Statements of 2014
22. Reviewed the revised Human Resources Policy of
for consideration of the Board.
the Bank.
23. Reviewed the Quarterly Operations Report (QOR) Meeting with Statutory Auditors
of all Branches on quarterly basis.
The Committee met with the Statutory Auditors for
24. Evaluated the status of large investment clients on finalization of financial statements. It properly addressed
regular basis. the issues mentioned in the Management Letter for taking
appropriate action by the Management.
25. Evaluated the certificate on the effectiveness of
Internal Control Policy, Practice & Procedure of the
bank. Acknowledgement
26. Appraised the implementation status of Circulars/ The Committee expressed its profound thanks and gratitude
Circular Letters issued by Regulatory bodies to the Members of the Board, Management, Auditors and the
(Bangladesh Bank & others). Regulatory Authorities, in particular, Bangladesh Bank and
the Bangladesh Securities and Exchange Commission for
Statutory Auditors’ Appointment their excellent support while performing its coveted duties
and responsibilities.
The Audit Committee recommended to the Board for
appointing Statutory Auditors in the Annual General Meeting
for the year 2015.
Interim Financial Reports of 2014

Professor NRM Borhan Uddin, Ph.D.
Chairman
The Audit Committee reviewed and recommended the
Audit Committee
quarterly & half yearly Financial Statements to the Board and
ensured that authentic and reliable Financial Information
have been incorporated in preparing those Financial
Statements and in other interim reports.

Independent Auditors’ Report
&
Audited Financial Statements
of
and its Subsidiaries

To the Shareholders of Islami Bank Bangladesh Limited
We have audited the accompanying consolidated financial statements of Islami Bank Bangladesh Limited and its subsidiaries
(the “Group”) as well as the separate financial statements of Islami Bank Bangladesh Limited (the “Bank”), which comprise
the consolidated and separate balance sheets as at 31 December 2014, and the consolidated and separate profit and loss
accounts, consolidated and separate statements of changes in equity and consolidated and separate cash flow statements
for the year then ended, and a summary of significant accounting policies and other explanatory information.
Management’s Responsibility for the Financial Statements and Internal Controls
Management is responsible for the preparation of consolidated financial statements of the Group and also separate financial
statements of the Bank that give a true and fair view in accordance with Bangladesh Financial Reporting Standards (BFRS)
as explained in note 2.1 and for such internal control as management determines is necessary to enable the preparation of
consolidated financial statements of the Group and also the separate financial statements of the Bank that are free from
material misstatement, whether due to fraud or error. The Bank Company Act, 1991 as amended and the Bangladesh Bank
regulations require the management to ensure effective internal audit, internal control and risk management functions of the
Bank. The management is also required to make a self-assessment on the effectiveness of anti-fraud internal controls and
report to Bangladesh Bank on instances of fraud and forgeries.
Auditors’ Responsibility
Our responsibility is to express an opinion on these consolidated financial statements of the Group and the separate financial
statements of the Bank based on our audit. We conducted our audit in accordance with Bangladesh Standards on Auditing
(BSA). Those standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable
assurance about whether the consolidated financial statements of the Group and the separate financial statements of the
Bank are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the consolidated
financial statements of the Group and separate financial statements of the Bank. The procedures selected depend on our
judgment, including the assessment of the risks of material misstatement of the consolidated financial statements of the
Group and the separate financial statements of the Bank, whether due to fraud or error. In making those risk assessments,
the auditor considers internal control relevant to the entity’s preparation of consolidated financial statements of the Group
and the separate financial statements of the Bank that give a true and fair view in order to design audit procedures that are
appropriate in the circumstances. An audit also includes evaluating the appropriateness of accounting policies used and
the reasonableness of accounting estimates made by management, as well as evaluating the overall presentation of the
consolidated financial statements of the Group and also the separate financial statements of the Bank.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.
Opinion
In our opinion, the consolidated financial statements of the Group and also the separate financial statements of the Bank give
a true and fair view of the consolidated financial position of the Group and the separate financial position of the Bank as at 31
December 2014, and of its consolidated and separate financial performance and its consolidated and separate cash flows for
the year then ended in accordance with Bangladesh Financial Reporting Standards (BFRS) as explained in note 2.1.
Report on Other Legal and Regulatory Requirements
In accordance with the Companies Act 1994, Securities and Exchange Rules 1987, the Bank Company Act 1991 as amended
and the rules and regulations issued by Bangladesh Bank, we also report the following:

(a) we have obtained all the information and explanation which to the best of our knowledge and belief were necessary
for the purpose of our audit and made due verification thereof;
(b) to the extent noted during the course of our audit work performed on the basis stated under the Auditors’
Responsibility section in forming the above opinion on the consolidated financial statements of the Group and the
separate financial statements of the Bank and considering the reports of the management to the Bangladesh Bank
on anti-fraud internal controls and instances of fraud and forgeries as stated under the Management’s Responsibility
for the Financial Statements and Internal Control:
i) internal audit, internal control and risk management arrangements of the Group and the Bank as disclosed in
note 3.31 appeared to be adequate;
ii) nothing has come to our attention regarding material instances of forgery or irregularity or administrative error
and exception or anything detrimental committed by employees of the Bank and its related entities other than
matters disclosed in note 3.31.8;
(c) financial statements of subsidiary companies of the Bank namely Islami Bank Securities Limited have been audited
by Howladar Yunus & Co., Chartered Accountants and Islami Bank Capital Management Limited have been audited
by Hussain Farhad & Co., Chartered Accountants and have been properly reflected in the consolidated financial
statements;
(d) in our opinion, proper books of accounts as required by law have been kept by Islami Bank Bangladesh Limited so far
as it appeared from our examination of those books and proper returns adequate for the purpose of our audit have
been received from 225 branches not visited by us;
(e) the consolidated balance sheet and consolidated profit and loss account of the Group and the separate balance
sheet and separate profit and loss account of the Bank dealt with by the report are in agreement with the books of
account;
(f) the expenditure incurred was for the purposes of the Bank’s business;
(g) the consolidated financial statements of the Group and the separate financial statements of the Bank have been
drawn up in conformity with prevailing rules, regulations and Bangladesh Financial Reporting Standards as explained
in note 2.1 as well as with related guidance, circulars issued by Bangladesh Bank and decision taken in tripartite
meeting amongst Inspection Team of Bangladesh Bank, External Auditors and the Management of Islami Bank
Bangladesh Limited held on 03 March 2015;
(h) adequate provisions have been made for the investments, other assets and off-Balance Sheet items which are, in our
opinion, doubtful of recovery;
(i) the records and statements submitted by the branches have been properly maintained and consolidated in the
financial statements;
(j) the information and explanation required by us have been received and found satisfactory;
(k) we have reviewed over 80% of the risk weighted assets of the Bank and we have spent around 9,000 person hours for
the audit of the books and accounts of the Bank.
Aziz Halim Khair Choudhury Syful Shamsul Alam & Co. Howladar Yunus & Co.
Chartered Accountants Chartered Accountants Chartered Accountants
Date: 21 March, 2015

Place: Dhaka

Islami Bank Bangladesh Limited and its Subsidiaries
Consolidated Balance Sheet
As at 31 December 2014
31.12.2014 31.12.2013
Particulars Notes
Taka Taka
Property and Assets
Cash in hand 7(a) 46,219,359,839 44,291,523,619
Cash in hand (including foreign currency) 7(a)(i) 7,696,844,962 8,180,346,965
Balance with Bangladesh Bank & its agent bank(s) (including foreign currency) 7(a)(ii) 38,522,514,877 36,111,176,654
Balance with other banks & financial institutions 8(a) 23,615,218,198 12,700,116,779
In Bangladesh 8(a)(i) 21,205,895,651 7,950,737,265
Outside Bangladesh 8(a)(ii) 2,409,322,547 4,749,379,514
Placement with banks & other financial institutions 9.0 2,000,000,000 -
Investments in shares & securities 10(a) 99,677,400,553 66,098,953,627
Government 10(a)(i) 97,435,777,770 63,698,877,770
Others 10(a)(ii) 2,241,622,783 2,400,075,857
Investments 460,385,467,466 402,994,804,977
General investments etc. 11.1(a) 433,004,101,205 375,000,298,497
Bills purchased & discounted 11.2(a) 27,381,366,261 27,994,506,480
Fixed assets including premises 12(a) 15,930,479,589 15,738,858,683
Other assets 13(a) 3,751,558,076 4,545,107,670
Non - banking assets - -
Total property and assets 651,579,483,721 546,369,365,355
Liabilities and Capital
Liabilities
Placement from banks & other financial institutions 46 (a) 7,657,500,743 -
Deposits & other accounts 14(a) 559,713,580,029 472,121,971,348
Mudaraba savings deposits 183,125,942,453 155,191,605,056
Mudaraba term deposits 169,288,934,029 130,523,371,328
Other mudaraba deposits 149,300,904,194 130,276,510,230
Al- wadeeah current and other deposit accounts 54,347,905,252 52,000,826,777
Bills payable 3,649,894,101 4,129,657,957
Mudaraba perpetual bond 15.0 3,000,000,000 3,000,000,000
Other liabilities 16(a) 34,220,763,730 27,289,134,160
Deferred tax liabilities 17(a) 403,081,867 194,189,314
Total liabilities 604,994,926,369 502,605,294,822
Capital/shareholders’ equity 46,584,557,352 43,764,070,533

Paid - up capital 18.0 16,099,906,680 14,636,278,800
Statutory reserve 20.0 16,099,906,680 14,638,613,627
Other reserves 21.0 11,998,012,969 11,851,258,703
Retained earnings 39(a) 2,386,670,563 2,637,858,071
Non-controlling interest 39(b) 60,460 61,332
Total liabilities & shareholders’ equity 651,579,483,721 546,369,365,355

Consolidated Balance Sheet
31.12.2014 31.12.2013
Particulars Notes
Taka Taka
Off-balance sheet items
Contingent liabilities
Acceptances & endorsements - -
Letters of guarantee 22.0 8,839,985,590 7,354,594,651
Irrevocable letters of credit (including back to back bills) 99,102,373,685 83,946,725,635
Bills for collection 4,853,286,313 22,390,676,317
Other contingent liabilities 23,581,701 23,581,701
Total 112,819,227,289 113,715,578,304
Other commitments
Documentary credits, short term and trade related transactions - -
Forward assets purchased and forward deposits placed - -
Undrawn note issuance, revolving and underwriting facilities - -
Undrawn formal standby facilities, credit lines and other commitments - -
Total - -
Total off-balance sheet items including contingent liabilities 112,819,227,289 113,715,578,304
The annexed notes form an integral part of these financial statements.
Prof. NRM Borhan Uddin Ph.D Md. Abdus Salam FCA, FCS
Director Director
Barrister Mohammed Belayet Hossain Mohammad Abdul Mannan

Director Managing Director
This is the consolidated balance sheet referred to in our separate report of even date.
Aziz Halim Khair Choudhury Syful Shamsul Alam & Co Howladar Yunus & Co.
Dhaka
21 March 2015

Consolidated Profit & Loss Account
For the year ended 31 December 2014
Particulars Notes 2014 2013
Taka Taka
Operating income
Investment income 23(a) 49,109,956,379 48,145,464,380
Profit paid on mudaraba deposits 24(a) (30,592,937,508) (30,900,279,562)
Net investment income 18,517,018,871 17,245,184,818
Income from investments in shares & securities 25(a) 1,847,241,058 2,112,029,193
Commission, exchange & brokerage income 26(a) 5,883,332,280 4,978,658,614
Other operating income 27(a) 1,223,373,942 985,819,291
Total operating income 27,470,966,151 25,321,691,916
Operating expenses
Salary & allowances 28(a) 8,197,568,114 7,552,761,347
Rent, taxes, insurances, electricity etc. 29(a) 1,000,045,580 825,130,483
Legal expenses 30(a) 16,206,043 35,285,323
Postage, stamps and telecommunication etc. 31(a) 47,306,134 44,536,896
Stationery, printing and advertisement etc. 32(a) 317,612,092 330,098,889
Chief executive’s salary & fees 33.0 8,400,000 7,323,548
Directors’ fees & expenses 34(a) 13,183,767 11,875,334
Shari’ah supervisory committee’s fees & expenses 35.0 2,562,124 1,401,423
Auditors’ fees 36(a) 2,344,118 2,168,000
Charges on investment losses - -
Depreciation and repair to bank’s assets 37(a) 866,506,137 729,987,642
Zakat expenses 425,985,241 385,750,934
Other expenses 38(a) 1,205,550,108 1,138,621,359
Total operating expenses 12,103,269,458 11,064,941,178
Profit/ (loss) before provision 15,367,696,693 14,256,750,738
Provision for investments & off- balance sheet exposures 16.1.4 4,670,784,729 3,015,633,502
Provision for diminution in value of investments in shares 16.2(a) 36,184,361 45,627,899
Other provisions 16.4 117,049,502 13,201,000
Total provision 4,824,018,592 3,074,462,401
Total profit/(loss) before taxes 10,543,678,101 11,182,288,337
Provision for taxation for the period
Current tax 16.7(a) 6,367,368,688 6,195,969,079
Deferred tax 17(b) 208,892,553 (44,439,537)
Net profit/ (loss) after tax 3,967,416,860 5,030,758,795
Net profit after tax attributable to: 3,967,416,860 5,030,758,795
Equity holders of IBBL 3,967,415,282 5,030,757,057
Non-controlling interest 39(b) 1,578 1,738
Retained earnings from previous year 2,637,858,071 3,073,402,299
Add: Net profit after tax (attributable to equity holders of IBBL) 3,967,415,282 5,030,757,057
Profit available for appropriation 6,605,273,353 8,104,159,356
Appropriation: 6,605,273,353 8,104,159,356

General reserve 122,779,553 123,940,000
Dividend 2,634,530,184 3,127,410,000
Retained earnings 39(a) 2,386,670,563 2,637,858,071
Consolidated earnings per share 41(a) 2.46 3.12
Prof. NRM Borhan Uddin Ph.D Md. Abdus Salam FCA, FCS Barrister Mohammed Belayet Hossain Mohammad Abdul Mannan
Director Director Director Managing Director
This is the consolidated profit & Loss account referred to in our separate report of even date.
Dhaka
21 March 2015

Consolidated Cash Flow Statement
2014 2013
Particulars Note
Taka Taka
Cash flows from operating activities
Investment income 49,004,594,914 49,302,935,930
Profit paid on mudaraba deposits (31,722,869,528) (30,718,018,746)
Income/ dividend receipt from investments in shares & securities 1,870,699,544 2,112,029,193
Fees & commission receipt in cash 5,883,332,280 4,978,658,614
Recovery from written off investments 39,350,296 43,918,185
Payments to employees (8,100,074,962) (7,130,884,895)
Cash payments to suppliers (326,348,124) (306,150,694)
Income tax paid (5,648,297,930) (5,763,293,016)
Receipts from other operating activities 1,213,407,361 985,205,915
Payments for other operating activities (2,594,835,403) (2,977,864,593)
(i) Operating profit before changes in operating assets 9,618,958,448 10,526,535,893
Changes in operating assets and liabilities
Increase/(decrease) of statutory deposits - -
(Increase)/decrease of net trading securities - -
(Increase)/decrease of placement to other banks - -
(Increase)-decrease of investments to customers (57,190,662,489) (30,274,082,090)
(Increase)/decrease of other assets 1,013,868,776 (1,475,585,020)
Increase/(decrease) of placement from other banks 7,657,500,743 -
Increase/(decrease) of deposits from other banks (193,547,298) (1,023,989)
Increase/(decrease) of deposits received from customers 86,764,748,509 52,892,382,596
Increase/(decrease) of other liabilities account of customers - -
Increase/(decrease) of trading liabilities - -
Increase/(decrease) of other liabilities 2,872,167,220 2,132,072,253
(ii) Cash flows from operating assets and liabilities 40,924,075,461 23,273,763,750
Net cash flows from operating activities (A)=(i+ii) 50,543,033,909 33,800,299,643
Cash flows from investing activities
Proceeds from sale of securities 1,175,692,382 836,868,609
Payment for purchase of securities/BGIIB (34,768,348,787) (41,393,061,898)
Placement to Islamic Refinance Fund Account (2,000,000,000) -
Payment for purchase of securities/membership - -
Purchase/sale of property, plants & equipments (941,612,274) (1,555,262,018)
Purchase/sale of subsidiaries - -
Net cash flows from investing activities (B) (36,534,268,679) (42,111,455,307)
Cash flows from financing activities
Receipts from issue of debt instruments - -
Payment for redemption of debt instruments - -
Receipts from issuing ordinary share/ rights share - -
Dividend paid in Cash (1,170,902,304) (1,000,771,200)
Net cash flows from financing activities (C) (1,170,902,304) (1,000,771,200)
Net increase/(decrease) in cash (A+B+C) 12,837,862,926 (9,311,926,864)
Add/(less): effects of exchange rate changes on cash & cash equivalent 5,074,713 4,621,542
Add: cash & cash equivalents at beginning of the year 56,991,640,398 66,298,945,720
Cash & cash equivalents at the end of the year 44(a) 69,834,578,037 56,991,640,398
This is the consolidated cash flow statement referred to in our separate report of even date.
Dhaka
21 March 2015

176
Consolidated Statement of Changes in Equity
(Amount in Taka)
General/ Assets Revaluation Non-
Paid-up Share Statutory Retained
Particulars other revaluation reserve of controlling Total
capital premium reserve earnings
reserves * reserve securities interest
1 2 3 4 5 6 7 8 9 10(2+3+4+5+6+7+8+9)
Balance as at 01 January 2014 14,636,278,800 1,989,633 14,638,613,627 287,697,750 11,498,971,320 62,600,000 2,637,858,071 61,332 43,764,070,533
Annual Report 2014

Changes in accounting policy restated balance - - - - - - - -
Surplus/ (deficit) on account of revaluation of properties - - - - - - - -
Surplus/ (deficit) on account of revaluation of investments (shares - - - - - 18,900,000 - - 18,900,000
& securities)
Currency translation differences - - - 5,074,713 - - - 5,074,713
Net gain and losses not recognized in the income statement - - - - - - - - -
Net profit for the period - - - - - - 3,967,415,282 1,578 3,967,416,860
Transfer to reserve - - 1,461,293,053 122,779,553 - - (1,584,072,606) - -
Dividend: - - - - - - -
Bonus shares 1,463,627,880 - - - - - (1,463,627,880) - -
Cash dividend - - - - - - (1,170,902,304) (2,450) (1,170,904,754)
Issue of share capital - - - - - - - - -
Total shareholders’ equity as on 31 December 2014 16,099,906,680 1,989,633 16,099,906,680 415,552,016 11,498,971,320 81,500,000 2,386,670,563 60,460 46,584,557,352
Add: Mudaraba perpetual bond - - - - - - - 3,000,000,000
Add: General provision for unclassified investments and off- balance - - - 4,753,680,000 - - - - 4,753,680,000
sheet items
Adjustment for currency translation differences - - - (6,392,484) - - - (6,392,484)
Less: 50.00% of assets revaluation reserve - - - - (5,749,485,660) - - - (5,749,485,660)
Less: 50.00% of revaluation reserve of securities - - - - - (40,750,000) - - (40,750,000)
Total equity as on 31 December 2014 16,099,906,680 1,989,633 16,099,906,680 5,162,839,532 5,749,485,660 40,750,000 2,386,670,563 60,460 48,541,609,208
*Note : General / other reserves 01.01.2014 01.01.2013

General reserve 254,379,979 130,439,979
Dividend equalization account 32,000,000 32,000,000
Currency translation differences 1,317,771 (3,303,771)
Total 287,697,750 159,136,208
Consolidated Statement of Changes in Equity
(Amount in Taka)
General/ Assets Revaluation Non-
Particulars other revaluation reserve of controlling Total
reserves * reserve securities interest
1 2 3 4 5 6 7 8 9 10(2+3+4+5+6+7+8+9)
Balance as at 01 January 2013 12,509,640,000 1,989,633 12,423,662,342 159,136,208 11,498,971,320 34,700,000 3,073,402,299 59,594 39,701,561,396
Changes in accounting policy restated balance - - - - - - - - -
Surplus/ (deficit) on account of revaluation of properties - - - - - - - - -
Surplus/ (deficit) on account of revaluation of investments (shares - - - - - 27,900,000 - - 27,900,000
& securities)
Net gain and losses not recognized in the income statement - - - - - - - - -
Net profit for the period - - - - - - 5,030,757,057 1,738 5,030,758,795
Transfer to reserve - - 2,214,951,285 123,940,000 - - (2,338,891,285) - -
Dividend: - - - - - - -
Bonus shares 2,126,638,800 - - - - - (2,126,638,800) - -
Cash dividend - - - - - - (1,000,771,200) - (1,000,771,200)
Issue of share capital - - - - - - - - -
Total shareholders’ equity as on 31 December 2013 14,636,278,800 1,989,633 14,638,613,627 287,697,750 11,498,971,320 62,600,000 2,637,858,071 61,332 43,764,070,533
Add: Mudaraba perpetual bond - - - - - - - - 3,000,000,000
Add: General provision for unclassified investments and off- balance - - - 4,508,800,000 - - - - 4,508,800,000
sheet items
Adjustment for currency translation differences (1,317,771) - (1,317,771)
Less: 50.00% of assets revaluation reserve - - - - (5,749,485,660) - - - (5,749,485,660)
Less: 50.00% of revaluation reserve of securities - - - - - (31,300,000) (31,300,000)
Total equity as on 31 December 2013 14,636,278,800 1,989,633 14,638,613,627 4,795,179,979 5,749,485,660 31,300,000 2,637,858,071 61,332 45,490,767,102
Annual Report 2014

This is the consolidated statement of changes in equity referred to in our separate report of even date.
177
Dhaka
21 March 2015
Balance Sheet
31.12.2014 31.12.2013
Particulars Notes
Taka Taka
Property and Assets
Cash in hand 7.0 46,219,359,426 44,291,514,939
Cash in hand (including foreign currency) 7.1 7,696,844,549 8,180,338,285
Balance with Bangladesh Bank & its agent bank(s) (including foreign currency) 7.2 38,522,514,877 36,111,176,654
Balance with other banks & financial institutions 8.0 20,199,350,245 12,327,320,344
In Bangladesh 8(i) 17,790,027,698 7,577,940,830
Outside Bangladesh 8(ii) 2,409,322,547 4,749,379,514
Placement with banks & other financial institutions 9.0 2,000,000,000 -
Investments in shares & securities 10.0 100,856,528,896 67,211,398,968

Government 10.1 97,435,777,770 63,698,877,770
Others 10.2 3,420,751,126 3,512,521,198
Investments 11.0 463,475,467,466 403,194,804,977

General investments etc. 11.1 436,094,101,205 375,200,298,497
Bills purchased & discounted 11.2 27,381,366,261 27,994,506,480
Fixed assets including premises 12.0 15,926,361,916 15,732,808,589
Other assets 13.0 3,744,970,802 4,471,783,137
Non - banking assets - -
Total property and assets 652,422,038,751 547,229,630,954
Liabilities
Placement from banks & other financial institutions 46.0 7,657,500,743 -
Deposits & other accounts 14.0 560,696,300,836 473,140,955,031

Mudaraba savings deposits 14.1 183,128,708,639 156,072,977,380
Other mudaraba deposits 14.2 149,346,325,824 129,401,794,243
Al- wadeeah current and other deposit accounts 14.3 54,396,285,416 52,124,147,978
Bills payable 14.4 3,649,894,101 4,129,657,957
Mudaraba perpetual bond 15.0 3,000,000,000 3,000,000,000
Other liabilities 16.0 34,052,027,094 27,133,860,568
Deferred tax liabilities 17.0 403,397,747 194,134,041
Total liabilities 605,809,226,420 503,468,949,640
Capital/ shareholders’ equity 46,612,812,331 43,760,681,314

Paid - up capital 18.0 16,099,906,680 14,636,278,800
Other reserves 21.0 11,998,012,969 11,851,258,703
Retained Earnings 39.0 2,414,986,002 2,634,530,184
Total liabilities & shareholders’ equity 652,422,038,751 547,229,630,954

Balance Sheet
31.12.2014 31.12.2013
Particulars Notes
Taka Taka
Off-balance sheet items
Acceptances & endorsements - -
Letters of guarantee 22.0 8,839,985,590 7,354,594,651
Irrevocable letters of credit (including back to back bills) 99,102,373,685 83,946,725,635
Bills for collection 4,853,286,313 22,390,676,317
Other contingent liabilities 23,581,701 23,581,701
Total 112,819,227,289 113,715,578,304
Other commitments
Documentary credits, short term and trade related transactions - -

Forward assets purchased and forward deposits placed - -
Undrawn note issuance, revolving and underwriting facilities - -
Undrawn formal standby facilities, credit lines and other commitments - -
Total - -
Total off-balance sheet items including contingent liabilities 112,819,227,289 113,715,578,304
This is the balence sheet referred to in our separate report of even date.
Dhaka
21 March 2015

Profit & Loss Account
2014 2013
Particulars Notes
Taka Taka
Operating income
Investment income 23.0 49,109,956,379 48,145,464,380
Profit paid on mudaraba deposits 24.0 (30,650,270,621) (30,975,185,536)
Net investment income 18,459,685,758 17,170,278,844
Income from investments in shares & securities 25.0 1,900,248,402 2,047,514,660
Commission, exchange & brokerage income 26.0 5,870,373,508 4,969,126,047
Other operating income 27.0 1,166,448,971 931,638,616
Total operating income 27,396,756,639 25,118,558,167
Operating expenses
Salary & allowances 28.0 8,183,199,841 7,538,859,361
Rent, taxes, insurances, electricity etc. 29.0 996,139,867 822,139,328
Legal expenses 30.0 16,206,043 35,067,030
Postage, stamps and telecommunication etc. 31.0 47,130,710 44,343,667
Stationery, printing and advertisement etc. 32.0 317,409,591 329,947,366
Chief executive’s salary & fees 33.0 8,400,000 7,323,548
Directors’ fees & expenses 34.0 12,787,017 11,587,834
Shari’ah supervisory committee’s fees & expenses 35.0 2,562,124 1,401,423
Auditors’ fees 36.0 2,229,118 2,070,000
Charges on investment losses - -
Depreciation and repair to bank’s assets 37.0 862,001,406 725,713,644
Zakat expenses 425,985,241 385,750,934
Other expenses 38.0 1,200,083,831 1,134,942,662
Total operating expenses 12,074,134,789 11,039,146,797
Profit/ (loss) before provision 15,322,621,850 14,079,411,370
Provision for investments & off- balance sheet exposures 16.1.4 4,670,784,729 3,015,633,502
Provision for diminution in value of investments in shares 16.2 3,074,883 423,778
Other provisions 16.4 117,049,502 13,201,000
Total provision 4,790,909,114 3,029,258,280
Total profit/(loss) before taxes 10,531,712,736 11,050,153,090
Current tax 16.7.1 6,323,390,422 6,145,665,449
Deferred tax expense/(income) 17.0 209,263,706 (44,096,951)
Net profit/ (loss) after tax 3,999,058,608 4,948,584,592
Retained earnings from previous year 2,634,530,184 3,152,246,877
Add: Net profit after tax 3,999,058,608 4,948,584,592
Profit available for appropriation 6,633,588,792 8,100,831,469
Appropriation: 6,633,588,792 8,100,831,469
General reserve 122,779,553 123,940,000
Dividend 2,634,530,184 3,127,410,000
Retained earnings 39.0 2,414,986,002 2,634,530,184
Earnings per share (EPS) 41.0 2.48 3.07
This is the profit & loss account referred to in our separate report of even date.
Dhaka
21 March 2015

Cash Flow Statement
2014 2013
Particulars Note
Taka Taka
Investment income 49,004,594,914 49,302,935,930
Profit paid on mudaraba deposits (31,780,202,641) (30,792,924,720)
Income/ dividend receipt from investments in shares & securities 1,713,711,788 2,047,514,660
Fees & commission receipt in cash 5,870,373,508 4,969,126,047
Recovery from written off investments 39,350,296 43,918,185
Payments to employees (8,085,706,689) (7,116,982,909)
Cash payments to suppliers (326,145,623) (305,999,171)
Income tax paid (5,597,112,182) (5,731,916,584)
Receipts from other operating activities 1,166,448,971 931,638,616
Payments for other operating activities (2,583,191,009) (2,969,365,539)
(i) Operating profit before changes in operating assets 9,422,121,333 10,377,944,515
Increase/(decrease) of statutory deposits - -
(Increase)/decrease of net trading securities - -
(Increase)/decrease of placement to other banks - -
(Increase)/decrease of investments to customers (60,280,662,489) (30,274,082,090)
(Increase)/decrease of other assets 1,025,213,295 (1,496,849,260)
Increase/(decrease) of placement from other banks 7,657,500,743 -
Increase/(decrease) of deposits from other banks (193,547,298) (1,023,989)
Increase/(decrease) of deposits received from customers 87,748,893,103 53,897,836,775
Increase/(decrease) of other liabilities account of customers - -
Increase/(decrease) of trading liabilities - -
Increase/(decrease) of other liabilities 2,153,192,172 2,017,256,323
(ii) Cash flows from operating assets and liabilities 38,110,589,526 24,143,137,759
Net cash flows from operating activities (A)=(i+ii) 47,532,710,859 34,521,082,274
Proceeds from sale of securities - -
Payment for purchase of securities/BGIIB (33,626,229,928) (40,173,425,198)
Placement to Islamic Refinance Fund Account (2,000,000,000) -
Payment for purchase of securities/membership - -
Purchase/sale of property, plants & equipments (940,778,952) (1,555,029,989)
Purchase/sale of subsidiaries - -
Net cash flows from investing activities (B) (36,567,008,880) (41,728,455,187)
Receipts from issue of debt instruments - -
Payment for redemption of debt instruments - -
Receipts from issuing ordinary share/ rights share - -
Dividend paid in Cash (1,170,902,304) (1,000,771,200)
Net cash flows from financing activities (C) (1,170,902,304) (1,000,771,200)
Net increase/(decrease) in cash (A+B+C) 9,794,799,675 (8,208,144,113)
Add/(Less): effects of exchange rate changes on cash & cash equivalent 5,074,713 4,621,542
Add: cash & cash equivalents at beginning of the year 56,618,835,283 64,822,357,854
Cash & cash equivalents at the end of the year 44.0 66,418,709,671 56,618,835,283
This is the cash flow statement referred to in our separate report of even date.
Dhaka
21 March 2015

182
Statement of Changes in Equity
(Amount in Taka)
General/ Assets Revaluation
Particulars other revaluation reserve of Total
reserves * reserve securities
1 2 3 4 5 6 7 8 9 (2+3+ 4+5+6+7+ 8)
Annual Report 2014

Balance as at 01 January 2014 14,636,278,800 1,989,633 14,638,613,627 287,697,750 11,498,971,320 62,600,000 2,634,530,184 43,760,681,314
Changes in accounting policy restated balance
Surplus/ (deficit) on account of revaluation of properties - - - - - - -
Surplus/ (deficit) on account of revaluation of investments (shares - - - - - 18,900,000 - 18,900,000
& securities)
Net gain and losses not recognized in the income statement - - - - - - - -
Net profit for the period - - - - - 3,999,058,608 3,999,058,608
Transfer to reserve - - 1,461,293,053 122,779,553 - - (1,584,072,606) -
Dividend: -
Bonus shares 1,463,627,880 - - - - - (1,463,627,880) -
Cash dividend - - - - - - (1,170,902,304) (1,170,902,304)
Issue of share capital - - - - - - - -
Total shareholders’ equity as on 31 December 2014 16,099,906,680 1,989,633 16,099,906,680 415,552,016 11,498,971,320 81,500,000 2,414,986,002 46,612,812,331
Add: General provision for unclassified investments and off- - - - 4,753,680,000 - - - 4,753,680,000
balance sheet items
Adjustment for currency translation differences - - - (6,392,484) - - - (6,392,484)
Less: 50.00% of assets revaluation reserve - - - - (5,749,485,660) - - (5,749,485,660)
Less: 50.00% of revaluation reserve of securities - - - - - (40,750,000) - (40,750,000)
Total equity as on 31 December 2014 16,099,906,680 1,989,633 16,099,906,680 5,162,839,532 5,749,485,660 40,750,000 2,414,986,002 48,569,864,187
*Note : General / other reserves 01.01.2014 01.01.2013

General reserve 254,379,979 130,439,979
Reserve related to DTA on provision for BL - -
Currency translation differences 1,317,771 (3,303,771)
Total 287,697,750 159,136,208
(Amount in Taka)
General/ Assets Revaluation
Particulars other revaluation reserve of Total
reserves * reserve securities
1 2 3 4 5 6 7 8 9 (2+3+ 4+5+6+7+ 8)
Balance as at 01 January 2013 12,509,640,000 1,989,633 12,423,662,342 159,136,208 11,498,971,320 34,700,000 3,152,246,877 39,780,346,380
Changes in accounting policy restated balance - -
Surplus/ (deficit) on account of revaluation of properties - - - - - - -
Surplus/ (deficit) on account of revaluation of investments (shares - - - - - 27,900,000 - 27,900,000
& securities)
Net gain and losses not recognized in the income statement - - - - - - - -
Net profit for the period - - - - - 4,948,584,592 4,948,584,592
Transfer to reserve - - 2,214,951,285 123,940,000 - - (2,338,891,285) -
Dividend: -
Bonus shares 2,126,638,800 - - - - - (2,126,638,800) -
Cash dividend - - - - - - (1,000,771,200) (1,000,771,200)
Issue of share capital - - - - - - - -
Total shareholders’ equity as on 31 December 2013 14,636,278,800 1,989,633 14,638,613,627 287,697,750 11,498,971,320 62,600,000 2,634,530,184 43,760,681,314
Add: General provision for unclassified investments and off- - - - 4,508,800,000 - - - 4,508,800,000
balance sheet items
Adjustment for currency translation differences (1,317,771) (1,317,771)
Less: 50.00% of assets revaluation reserve - - - - (5,749,485,660) - - (5,749,485,660)
Less: 50.00% of revaluation reserve of securities - - - - - (31,300,000) - (31,300,000)
Total equity as on 31 December 2013 14,636,278,800 1,989,633 14,638,613,627 4,795,179,979 5,749,485,660 31,300,000 2,634,530,184 45,487,377,883
Annual Report 2014

This is the statement of changes in equity referred to in our separate report of even date.
183
Dhaka
21 March 2015
184
Liquidity Statement
Assets & liabilities analysis
Amount in Taka
Particulars Up to 1 Month 1 - 3 Months 3 - 12 Months 1 - 5 years More than 5 years Total 31.12.2014 Total 31.12.2013
1 2 3 4 5 6 7=(2 + 3 + 4 + 8
5 + 6)
ASSETS
Annual Report 2014

Cash in hand 10,375,904,079 - - - 35,843,455,347 46,219,359,426 44,291,514,939
Balance with other banks & financial institutions (Note-8.2) 10,994,350,245 9,025,000,000 180,000,000 - - 20,199,350,245 12,327,320,344
Placement with Banks & other Financial Institutions - 2,000,000,000 - - - 2,000,000,000 -
Investments (in shares & securities) (Note-10.4) 19,355,655,126 35,460,000,000 42,618,000,000 300,000,000 3,122,873,770 100,856,528,896 67,211,398,968
General investments etc. (Note-11.1.1) 63,378,766,515 79,432,061,802 107,961,949,441 96,501,760,873 88,819,562,574 436,094,101,205 375,200,298,497
Bills purchased & discounted (Note-11.2.1) 7,108,296,384 9,544,931,260 10,728,138,617 - - 27,381,366,261 27,994,506,480
Fixed assets including premises (land & building), furniture and fixtures - - 744,614,312 2,632,757,271 12,548,990,333 15,926,361,916 15,732,808,589
(Note-12.3)
Other assets (Note-13.1) 309,653,248 1,677,839,626 919,707,427 560,204,150 277,566,351 3,744,970,802 4,471,783,137
Non - banking assets - - - - - - -
Total assets 111,522,625,597 137,139,832,688 163,152,409,798 99,994,722,294 140,612,448,375 652,422,038,751 547,229,630,954
LIABILITIES
Placement from banks & other financial institutions 4,254,533,600 869,506,935 2,533,460,208 - - 7,657,500,743 -
Deposits (Note-14.6) 92,716,058,878 108,991,484,445 154,552,463,751 95,997,641,176 108,438,652,586 560,696,300,836 473,140,955,031
Other accounts - - - - - - -
Provision & other liabilities (Note-16.9) 2,952,471,399 12,821,710,542 3,899,744,057 1,811,279,527 12,566,821,569 34,052,027,094 27,133,860,568
Deferred tax liability/ (assets) - - - - 403,397,747 403,397,747 194,134,041
Mudaraba perpetual bond - - - - 3,000,000,000 3,000,000,000 3,000,000,000
Total liabilities 99,923,063,877 122,682,701,922 160,985,668,016 97,808,920,703 124,408,871,902 605,809,226,420 503,468,949,640
Net liquidity gap 11,599,561,720 14,457,130,767 2,166,741,782 2,185,801,591 16,203,576,473 46,612,812,331 43,760,681,314
This is the liquidity statement referred to in our separate report of even date.
Dhaka
21 March 2015
Notes to the consolidated financial statements
1.0 The Bank and its activities
1.1 Islami Bank Bangladesh Limited (hereinafter referred to as “the Bank” or “IBBL”) was established as a Public Limited Banking
Company in Bangladesh in 1983 as the first Shari’ah based Scheduled Commercial Bank in the South East Asia. Naturally, its
modus operandi is substantially different from those of other conventional Commercial Banks. The Bank conducts its business
on the Shari’ah principles of Mudaraba, Musharaka, Bai-Murabaha, Bai-Muajjal, Hire Purchase under Shirkatul Melk, Bai-Salam
and Bai-as-Sarf etc. There is a Shari’ah Supervisory Committee in the Bank which ensures that the activities of the Bank are
being conducted on the precepts of Islam.
The shares of the Bank are listed with both Dhaka Stock Exchange (DSE) Limited and Chittagong Stock Exchange (CSE)
Limited. The Bank carries out its business activities through its Head Office in Dhaka, 14 Zonal Offices, 294 branches including
53 Authorised Dealer (AD) branches and 3 Off-shore Banking Units (OBUs) in Bangladesh. The Principal place of business is the
Registered Office of the Bank situated at Islami Bank Tower, 40, Dilkusha Commercial Area, Dhaka-1000, Bangladesh.
These financial statements as at and for the year ended 31 December 2014 include the consolidated and separate financial
statements of the Bank. The consolidated financial statements comprise the financial statements of the Bank and its
subsidiaries (mentioned in Note - 1.4, together referred to as “the Companies”).
1.2 Nature of business/principal activities of the Bank
1.2.1 Commercial banking services
All kinds of commercial banking services are provided by the Bank to the customers following the principles of Islamic Shari’ah,
the provisions of the Bank Company Act, 1991 as amended, Bangladesh Bank’s directives and directives of other regulatory
authorities.
1.2.2 Islamic micro-finance
Islamic micro-finance represents micro-finance and the Islamic finance industry. Under Islamic micro-finance, major focus is
given on improvement of living standard of poor people. The projects are closely monitored so that the members are really
benefited. IBBL provides this services under the umbrella of Rural Development Scheme (RDS) and Urban Poor Development
Scheme (UPDS).
1.2.3 Mobile financial services -”mCash”
IBBL has launched mobile financial services on 27 December 2012 under the name “Islami Bank mCash” as per Bangladesh
Bank approval (reference no. DCMPS/PSD/37/(W)/2012-321 dated 14 June 2012). Islami Bank mCash offers different services
through Mobile phone that include deposit and withdrawal of cash money, fund transfer from one account to another, receiving
remittance from abroad, knowing account balance and mini-statement, giving and receiving salary, mobile recharge and
payment of utility bill, merchant bill payment etc.
1.3 Off-shore banking unit (OBU)
Bangladesh Bank has approved the operation of Off-Shore Banking Unit (OBU) of Islami Bank Bangladesh Limited located
at Head Office Complex Branch- Dhaka, Uttara Branch- Dhaka and Agrabad Branch- Chittagong through letter no. BRPD
(P-3)744(111)/2010-1032 dated 28 March, 2010. The Bank commenced the operation of its Off-shore Banking Unit from
08.02.2011 at Head Office Complex Branch, Dhaka, and from 27.09.2011 at Agrabad Branch, Chittagong. Operations of OBU
located at Uttara Branch, Dhaka has not yet been started. Due to having different functional currency (Note 2.3), the operation
of OBU has been considered as “foreign operation” for reporting purposes and relevant financial reporting standards have been
applied accordingly (Note 3.2.2). The financial statements of the OBU are included in the separate financial statements of the
Bank and eventually in the consolidated financial statements. The sole financial statements of OBU are shown both in the
currency in which it operates (i.e. USD) and in the presentation currency of the Bank (i.e. BDT) in Annexure - E.

1.4 Subsidiaries of the Bank
1.4.1 Islami Bank Securities Limited (IBSL)

As per Bangladesh Securities and Exchange Commission’s (BSEC) Letter No. SEC/Reg/CSE/MB/ 2009/444 dated 20.12.2009
and approval of Bangladesh Bank through Letter No. BRPD (R-1)717/2010-47 dated 07.02.2010; IBBL established a subsidiary
Company named “Islami Bank Securities Limited” to operate stock broker and stock dealer activities.
The share capital of Islami Bank Securities Ltd. is Tk. 2,700,000,000/- divided into 2,700,000 shares of Tk.1,000/ each out of
which share capital of IBBL is Tk.2,699,946,000/- divided into 2,699,946 shares of Tk.1,000/- each which represent 99.998% of
total share of the subsidiary Company.
IBSL was incorporated on 22.03.2010 and date of commencement of business was 23.05.2010. Required capital was
transferred to IBSL on 25.05.2010 which is operating business under the license issued by the Bangladesh Securities &
Exchange Commission (BSEC). As a stock broker, IBSL acts as an agent in the purchase and sale of Shari’ah approved listed
securities and realizes commission on transactions in accordance with approved commission schedule.
1.4.2 Islami Bank Capital Management Limited (IBCML)

As per Bangladesh Bank BRPD Circular No. 12 dated 14.10.2009 and approval of Bangladesh Bank through Letter No. BRPD
(R-1)717/2010-47 dated 07.02.2010, IBBL established another subsidiary Company named “Islami Bank Capital Management
Limited” to operate portfolio management, underwriting, issue management etc. IBCML was incorporated on 01.04.2010 and
required capital was transferred on 06.07.2010.
The share capital of Islami Bank Capital Management Ltd. is Tk.300,000,000/- divided into 300,000 shares of Tk.1,000/ each
out of which share capital of IBBL is Tk.299,993,000/- divided into 299,993 shares of Tk.1,000/- each which represent 99.998%
of total share of the subsidiary Company. Permission of Bangladesh Securities and Exchange Commission (BSEC) is yet to be
received for the core operation of IBCML.
1.4.3 IBBL Exchange Singapore Pte. Ltd.
IBBL Exchange Singapore Pte. Ltd. has been incorporated in Singapore, as a subsidiary of Islami Bank Bangladesh Limited for
remittance services and things incidental thereto under the Companies Act, CAP. 50 of the Republic of Singapore. Till 31 December
2014, no share capital of the subsidiary has been paid by its parent company i.e. Islami Bank Bangladesh Limited. Therefore, the
financial statements of IBBL Exchange Singapore Pte. Ltd has not been consolidated with that of the parent i.e. IBBL.
2.0 Basis of preparation
2.1 Statement of compliance
The Bank and its subsidiaries are being operated in strict compliance with the rules of Islamic Shari’ah. The consolidated
and separate financial statements of the Bank have been prepared basically as per provisions of the “Guidelines for Islamic
Banking” issued by Bangladesh Bank through BRPD Circular No. 15 dated 09.11.2009 with reference to the provisions of the
Bank Company Act, 1991 as amended and by Bangladesh Bank BRPD Circular No.14 dated 25.06.2003 & Bangladesh Bank’s
other circulars/instructions and in accordance with International Financial Reporting Standards (IFRSs) adopted as Bangladesh
Financial Reporting Standards (BFRSs) by the Institute of Chartered Accountants of Bangladesh (ICAB); the Companies Act,
1994; the Securities and Exchange Rules, 1987; Dhaka and Chittagong Stock Exchanges’ Listing Regulations and other laws
and rules applicable in Bangladesh and Standards issued by the Accounting and Auditing Organization for Islamic Financial
Institutions (AAOIFI), as a member of that organization.
In case the requirements of guidelines and circulars issued by Bangladesh Bank differ with those of other regulatory authorities
and financial reporting standards, the guidelines and circulars issued by Bangladesh Bank prevails. As such the Bank has
departed from those requirements of BFRSs in order to comply with the rules and regulations of Bangladesh Bank which are
disclosed below:

i) Provision on investments and off-balance sheet exposures
BFRS: As per BAS 39 “Financial Instruments: Recognition and Measurement” an entity should start the impairment assessment
by considering whether objective evidence of impairment exists for financial assets that are individually significant. For financial
assets that are not individually significant, the assessment can be performed on an individual or collective (portfolio) basis.
Bangladesh Bank: As per BRPD circular No.14 dated 23 September 2012, BRPD circular No. 19 dated 27 December 2012, BRPD
circular No. 05 dated 29 May 2013 and BRPD circular No. 16 dated 18 November 2014 a general provision at 0.25% to 5% under
different categories of unclassified investments (good/standard investments) has to be maintained regardless of objective
evidence of impairment. Also provision for sub-standard, doubtful and bad & loss investments have to be provided at 20%, 50%
and 100% respectively (except short-term agricultural and micro-credits where 5% for sub-standard and doubtful investments
and 100% for bad & loss investments) depending on the duration of overdue. Again as per BRPD Circular No.14 dated 23
September 2012 and BRPD Circular No.19 dated 27 December 2012, a general provision at 1% is required to be provided for
all off-balance sheet exposures. Such provision policies are not specifically in line with those prescribed by “BAS 39 “Financial
Instruments: Recognition and Measurement”.
ii) Recognition of investment income in suspense
BFRS: Investment to customers are generally classified as ‘loans and receivables’ as per BAS 39 “Financial Instruments:
Recognition and Measurement” and investment income is recognised through effective interest rate method over the term of
the investment. Once an investment is impaired, investment income is recognised in profit and loss account on the same basis
based on revised carrying amount.
Bangladesh Bank: As per BRPD circular no. 14 dated 23 September 2012, once an investment is classified, investment income
on such investment are not allowed to be recognised as income, rather the corresponding amount needs to be credited to an
investment income in suspense account, which is presented as liability in the balance sheet.
iii) Investment in shares and securities
BFRS: As per requirements of BAS 39 “Financial Instruments: Recognition and Measurement” investment in shares and
securities generally falls either under “at fair value through profit and loss account” or under “available for sale” where any
change in the fair value (as measured in accordance with BFRS 13) at the year-end is taken to profit and loss account or
revaluation reserve respectively.
Bangladesh Bank: As per BRPD circular no. 14 dated 25 June 2003 investments in quoted shares and unquoted shares are
revalued at the year end at market price and as per book value of last audited balance sheet respectively. Provision should be
made for any loss arising from diminution in value of investment; otherwise investments are recognised at cost.
iv) Revaluation gains/losses on Government securities
BFRS: As per requirement of BAS 39 “Financial Instruments: Recognition and Measurement” where securities will fall under
the category of Held for Trading (HFT), any change in the fair value of held for trading assets is recognised through profit and
loss account. Securities designated as Held to Maturity (HTM) is measured at amortised cost method and interest income is
recognised through the profit and loss account.
Bangladesh Bank: HFT securities are revalued on the basis of mark to market and at year end any gains on revaluation of
securities which have not matured as at the balance sheet date are recognised in other reserves as a part of equity and
any losses on revaluation of securities which have not matured as at the balance sheet date are charged in the profit and
loss account. Profit on HFT securities including amortisation of discount are recognised in the profit and loss account.
HTM securities which have not matured as at the balance sheet date are amortised at the year end and gains or losses on
amortisation are recognised in other reserve as a part of equity.
v) Other comprehensive income
BFRS: As per BAS 1 “Presentation of Financial Statements” Other Comprehensive Income (OCI) is a component of financial
statements or the elements of OCI are to be included in a single Other Comprehensive Income statement.
Bangladesh Bank: Bangladesh Bank has issued templates for financial statements which will strictly be followed by all
banks. The templates of financial statements issued by Bangladesh Bank do not include Other Comprehensive Income are the
elements of Other Comprehensive Income allowed to be included in a single Other Comprehensive Income (OCI) Statement. As
such the Bank does not prepare the other comprehensive income statement. However, elements of OCI, if any, are shown in the
statements of changes in equity.

vi) Financial instruments - presentation and disclosure
In several cases Bangladesh Bank guidelines categorise, recognise, measure and present financial instruments differently from
those prescribed in BAS 39 “Financial Instruments: Recognition and Measurement”. As such full disclosure and presentation
requirements of BFRS 7 “Financial Instruments: Disclosures” and BAS 32 “Financial Instruments: Presentation” cannot be
made in the financial statements.
vii) Financial guarantees
BFRS: As per BAS 39 “Financial Instruments: Recognition and Measurement”, financial guarantees are contracts that require
an entity to make specified payments to reimburse the holder for a loss it incurs because a specified debtor fails to make
payment when due in accordance with the terms of a debt instrument. Financial guarantee liabilities are recognised initially
at their fair value, and the initial fair value is amortised over the life of the financial guarantee. The financial guarantee
liability is subsequently carried at the higher of this amortised amount and the present value of any expected payment
when a payment under the guarantee has become probable. Financial guarantees are included within other liabilities.
Bangladesh Bank: As per BRPD 14 dated 25 June 2003, financial guarantees such as letter of credit, letter of guarantee will be
treated as off-balance sheet items. No liability is recognised for the guarantee except the cash margin.
viii) Balance with Bangladesh Bank: (Cash Reserve Requirement)
BFRS: Balance with Bangladesh Bank that are required to be kept as part of cash reserve requirement, should be treated as
other asset as it is not available for use in day to day operations as per BAS 7 “Statement of Cash Flows”.
Bangladesh Bank: Balance with Bangladesh Bank is treated as cash and cash equivalents.
ix) Cash flow statement
BFRS: The Cash flow statement can be prepared using either the direct method or the indirect method. The presentation is
selected to present these cash flows in a manner that is most appropriate for the business or industry. The method selected
is applied consistently.
Bangladesh Bank: As per BRPD 14 dated 25 June 2003 and BRPD 15 dated 09 November 2009, cash flow statement is to be
prepared following a mixture of direct and indirect methods.
x) Non-banking asset
BFRS: No indication of Non-banking asset is found in any BFRS.
Bangladesh Bank: As per BRPD 14 dated 25 June 2003 and BRPD 15 dated 09 November 2009, there must exist a face item
named Non-banking asset.
xi) Presentation of intangible asset
BFRS: An intangible asset must be identified and recognised, and the disclosure must be given as per BAS 38 “Intangible
Assets”.
Bangladesh Bank: There is no regulation for intangible assets in BRPD 14 dated 25 June 2003 and BRPD 15 dated 09 November 2009.
xii) Off-balance sheet items
BFRS: There is no concept of off-balance sheet items in any BFRS; hence there is no requirement for disclosure of off-balance
sheet items on the face of the balance sheet.
Bangladesh Bank: As per BRPD 14 dated 25 June 2003 and BRPD 15 dated 09 November 2009, off balance sheet items (e.g.
Letter of credit, Letter of guarantee etc.) must be disclosed separately on the face of the balance sheet.

xiii) Investments net off provision
BFRS: Investments should be presented net off provision.
Bangladesh Bank: As per BRPD 14 dated 25 June 2003 and BRPD 15 dated 09 November 2009, provision on investments are
presented separately as liability and can not be netted off against investments.
xiv) Revenue
As per BAS 18 “Revenue”, revenue should be recognized on accrual basis but due to the unique nature of Islamic Banks, income
from investment under Mudaraba, Musharaka, Bai-Salam, Bai-as-Sarf and Ujarah modes is accounted for on realization basis
as per AAOIFI and Bangladesh Bank guidelines.
[Note 4 includes Compliance with Financial Reporting Standards as applicable in Bangladesh]
2.1.1 Authorization of the financial statements for issue
The consolidated financial statements and the separate financial statements of the Bank have been authorized for issue by the
Board of Directors on 21 March, 2015.
2.1.2 Changes in accounting standards
No new International Financial Reporting Standards (IFRSs) have been adopted by The Institute of Chartered Accountants of
Bangladesh (ICAB) as Bangladesh Financial Reporting Standards (BFRSs) during the year that are effective for the first time
for the financial year 2014 that have a significant impact on the Companies and accordingly no new accounting standards have
been applied in preparing these financial statements.
2.1.3 Prior period adjustments
Prior period adjustments, if any, to be recognized retrospectively as per BAS 8 “Accounting Policies, Changes in Accounting
Estimates and Errors”. Accordingly during the year an adjustment was made regarding the elimination on consolidation of
the amount of placement to AD Branches by Off-shore Banking Unit (OBU) shown in the head titled “Mudaraba/Mudaraba
Documentary Bills” under investments. OBU started this type of placement from the year 2013 which was kept in a head
titled “Cover Fund MDB Investment Account” under other liabilities at AD Branches. As per BFRS 10 “Consolidated Financial
Statements”, all intra-company balances should be eliminated on consolidation. Since, this type of transaction and related
balances arose only in the year 2013, the adjustment was made retrospectively from the year 2013 and corrected in current year.
Due to the above prior period adjustments, investment and other liabilities have been adjusted by Tk.3,609,750,453 and
Tk.3,585,147,117 respectively for the year 2013. Net profit after tax has been adjusted by Tk.24,603,336 and accordingly
general reserve has been adjusted by the same amount of that year. The effect in Earnings per Share (EPS) was of Tk.0.015 per
share (restated) due to the above adjustments.
2.2 Basis of measurement
The financial statements have been prepared on the historical cost basis except for the following material items:
- Land is recognized at cost at the time of acquisition and subsequently measured at fair value following revaluation model as
per BAS 16 “Property Plant & Equipment”.
- Investments in quoted shares are revalued at the year end at market price as per Bangladesh Bank circular.
2.3 Functional and presentation currency
The consolidated and separate financial statements of the Bank are presented in Bangladeshi Taka (Taka/Tk./BDT) which is
the functional currency of the Bank and its subsidiaries except Off-shore Banking Unit (OBU) where the functional currency is
US Dollar (USD).
All financial information presented in Taka has been rounded to the nearest integer, except otherwise indicated.

2.4 Use of estimates and judgments
The preparation of the consolidated and separate financial statements of the Bank in conformity with BFRSs require management
to make judgments, estimates and assumptions that affect the application of accounting policies and the reported amount of
assets, liabilities, income and expenses. Actual results may differ from these estimates.
Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognized
prospectively i.e. in the period in which the estimate is revised and in any future period affected.
Information about significant areas of estimation uncertainty and critical judgments in applying accounting policies that have
the most significant effect on the amounts recognized and presented in the consolidated and separate financial statements of
the Bank are included in following notes/statements:
a) Note 16.7 Current tax liabilities

b) Note 17.0 Deferred tax liabilities
c) Note 37.0 Depreciation
d) Note 16.1-16.4 Provisions for investments, diminution in value of investment in shares and other assets
e) Note 21.2 Asset revaluation reserve
f) Liquidity statement Assets & liabilities analysis
2.5 Cash flow statement
Cash Flow Statement is prepared in accordance with BAS 7 “Statement of Cash Flows”, and as per “Guidelines for Islamic
Banking” issued by Bangladesh Bank through BRPD Circular No. 15 dated 09.11.2009 and BRPD Circular No.14 dated
25.06.2003. The Statement shows the structure of changes in cash and cash equivalents during the financial year.
2.6 Statement of changes in equity
Statement of Changes in Equity has been prepared in accordance with BAS 1 “Presentation of Financial Statements”, and as
per “Guidelines for Islamic Banking” issued by Bangladesh Bank through BRPD Circular No. 15 dated 09.11.2009 and BRPD
Circular No.14 dated 25.06.2003.
2.7 Liquidity statement
Liquidity Statement has been prepared in accordance with the residual/remaining maturity of Assets and Liabilities as on 31
December 2014 and as per “Guidelines for Islamic Banking” issued by Bangladesh Bank through BRPD Circular No. 15 dated
09.11.2009 and BRPD Circular No.14 dated 25.06.2003 as per the following basis:
i) Balance with other banks and financial institutions, etc are on the basis of their respective maturity term;
ii) Investments in shares & securities are on the basis of their respective maturity;
iii) General investments are on the basis of their recovery/repayment schedule;
iv) Fixed assets are on the basis of their useful lives;
v) Other assets are on the basis of their realization/amortization;
vi) Deposits and other accounts are on the basis of their maturity and payments;
vii) Provisions and other liabilities are on the basis of their adjustment/settlement;
viii) Due to perpetual in nature/maturity, Mudaraba perpetual bond (MPB) is reported under maturity more than 5 (five)
years.
2.8 Reporting period
These financial statements of the Bank and its subsidiaries cover one calendar year from 01 January 2014 to 31 December
2014.

3.0 Significant accounting policies
The accounting policies set out below have been applied consistently to all periods presented in the consolidated and separate
financial statements of the Bank (together referred to as ‘financial statements’) except provision for investment which have
been changed due to new circular issued by Bangladesh Bank (Note 3.16.1).
Certain comparative amounts in the financial statements have reclassified and rearranged to conform to the current year’s
presentation.
3.1 Basis of consolidation
3.1.1 Subsidiaries
Subsidiaries are investees controlled by the Parent. The Parent ‘controls’ an investee if it is exposed to, or has rights to, variable
returns from its involvement with the investee and has the ability to affect those returns through its power over the investee.
The financial statements of subsidiaries are included in the consolidated financial statements from the date that control
commences until the date that control ceases.
3.1.2 Transactions eliminated on consolidation
Inter-company balances and transactions, and any unrealized income and expenses (except for foreign currency transaction
gains and losses) arising from inter-company transactions are eliminated in preparing consolidated financial statements.
Unrealized losses are eliminated in the same way as unrealized gains, but only to the extent that there is no evidence of
impairment. The investments in shares of subsidiaries held by the Bank in the separate financial statements are eliminated
against the corresponding share capital of subsidiaries in the consolidated financial statements.
3.2 Foreign currency
3.2.1 Foreign currency transactions
Transactions in foreign currencies are translated into the respective functional currencies (Bangladeshi Taka in case of IBBL
Main Operations and US Dollar in case of OBU) at the spot exchange rates ruling at the date of transactions as per BAS 21
“The Effects of Changes in Foreign Exchange Rates”. Monetary assets and liabilities held in US Dollar at the reporting date are
retranslated into the functional currency in BDT at the weighted average revaluation rate of inter-bank market as determined
by Bangladesh Bank. Monetary assets and liabilities denominated in other foreign currencies at the reporting date are first
translated into US Dollar at buying rates of New York closing of the previous day and then retranslated from US Dollar into the
functional currencies in the same manner specified above.
Non-monetary assets and liabilities denominated in foreign currencies that are measured at fair value are retranslated to
the functional currency at the exchange rate at the date that the fair value was determined. Non-monetary items in a foreign
currency that are measured based on historical cost are translated using the exchange rate at the date of the transaction.
Foreign exchange differences (rates at which transactions were initially recorded and the rate prevailing on the reporting date/
date of settlements) of the monetary items are recognized in the profit and loss.
3.2.2 Foreign operations
The assets and liabilities of foreign operations (Note - 1.3) are translated to Bangladeshi Taka at spot exchange rates prevailing
at the reporting date. The income and expenses of foreign operations are translated at spot exchange rates at the date of
transactions as long as practicable otherwise average rate of exchange has been used. Foreign currency differences arising
on translation are recognized in other comprehensive income and presented directly in the foreign currency translation
reserve (translation reserve) in equity. If the settlement of a monetary item receivable from or payable to a foreign operation
is neither planned nor likely in the foreseeable future, then foreign currency differences arising on the item form part of the
net investment in the foreign operation and are recognized in other comprehensive income and accumulated in the translation
reserve within equity.

3.3 Revenue
3.3.1 Investment income
Income from general investments is accounted for on accrual basis except for investments under Musharaka, Mudaraba,
Bai-Salam, Bai-as-Sarf and Ujarah (Khidmah Card) modes of Investment where the investment income is accounted for on
realization basis. The Bank does not charge any rent during the gestation period of investment against Hire Purchase under
Shirkatul Melk (HPSM) mode of investment but it fixes the sale price of the assets at a higher level in such a way to cover its
expected rate of return. Such income is recognized on realization basis.
Profit/Rent/Compensation accrued on Classified Investments are suspended and accounted for as per circulars issued by
Bangladesh Bank in this regard from time to time. At the time of recovery or regularization of those investments the related
income which was suspended and shown as a liability is taken as investment income as per circulars issued by Bangladesh
Bank. As a result, all the transferred amount to investment income from suspense during the year has already beed included in
the investment income of the Bank
Profit on deposits with other banks & financial statements is accounted for on accrual basis.
3.3.1.1 Sharing of investment income
In case of investment, Mudaraba fund gets preference over cost free fund. The investment income earned through deployment
of Mudaraba Fund is shared by the Bank and the Mudaraba depositors at the pre-agreed ratio.
3.3.2 Income from investment in Bangladesh Government Islamic Investment Bond (BGIIB) & Islamic Inter-bank Fund Market (IIFM)
Profit from investment in Bangladesh Government Islamic Investment Bond (BGIIB) & Islamic Inter-bank Fund Market (IIFM) is
accounted for on accrual basis.
3.3.3 Fees, commission and exchange income
Fees, Commission and Exchange Income on services provided by the Bank are recognized as and when the related services
are rendered. Commission charged to customers on letter of credit and letter of guarantee are credited to Income at the time
of effecting the transactions.
3.3.4 Dividend income
Dividend income from investments is accounted for when the right to receive income is established.
3.4 Income tax expenses
Income tax expenses comprise current and deferred taxes. Income taxes are recognized in profit or loss except to the extent
that it relates to items recognized directly in equity, in which case it is recognized in equity.
3.4.1 Current tax
Current tax is the expected tax payable on the taxable income for the year, using tax rates enacted or substantially enacted
at the reporting date and any adjustment to the tax payable in respect of previous years. Provision for current income tax has
been made on taxable income of the Bank as per following rates:
Type of income 2014 2013
Business income 42.50% 42.50%
Dividend income 20.00% 20.00%

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

3.8.1 Held to Maturity (HTM)
Held-to-maturity investments are non-derivative assets with fixed or determinable payments and fixed maturity that the entity
has the positive intent and ability to hold to maturity, and which are not designated as at fair value through profit or loss or as
available for sale. These are measured at amortized cost at each year end by taking into account any discount or premium on
acquisition. Any increase or decrease in value of such investments is recognized in equity.
3.8.2 Held for Trading (HFT)/Fair value through profit or loss (FVTPL)
Some investment in shares and securities are designated at fair value, with fair value changes recognized immediately in profit
or loss.
3.8.3 Available-for-sale (AFS)
Available-for-sale investments are non-derivative investments that are designated as available-for-sale or are not classified
as another category of financial assets. Available-for-sale investments comprise generally equity securities. Unquoted equity
securities whose fair value cannot reliably be measured are carried at cost. All other available-for-sale investments are carried
at fair value and changes recognized in equity (Note 3.18.6).
Dividend income is recognized in profit or loss when the right to receive income is established. Other fair value changes, other
than impairment losses are presented as reserve in equity.
3.8.4 Derivative investments
The Bank has no investment in any derivative instrument.
3.9 Investment in subsidiaries
Investments in subsidiaries are accounted for under cost method of accounting in the Bank’s Financial Statements in
accordance with BFRS 10”Consolidated Financial Statements”.
3.10 Fixed assets
3.10.1 Recognition and measurement
Items of fixed assets excluding land and building are measured at cost less accumulated depreciation and accumulated
impairment losses. Land and building is recognized at cost at the time of acquisition and subsequently measured at revalued
amounts which is the fair value at the time of revaluation done by independent valuer and any surplus on revaluation is shown
as equity component until the disposal of asset, as per BAS 16 “Property, Plant & Equipment” and Bangladesh Bank BCD
Circular Letter No. 12 & 18 dated 20 April 1993 & 15 June 1993 respectively and BRPD Circular No.10 dated 25 November 2002
& BRPD Circular No.09 dated 31 December 2008. Deficit arising on subsequent revaluation is adjusted against the balance in
the Revaluation reserve account. Revaluation is carried out with sufficient regularity to ensure that the carrying amount of
assets does not differ materially from their fair value.
Cost includes expenditures that are directly attributable to the acquisition of assets. The cost of self-constructed assets
includes the following:
- the cost of materials and direct labour;
- any other cost directly attributable to bringing the asset to a working condition for the intended use;
- when the Companies have an obligation to remove the asset or restore the site, an estimate of the costs of dismantling
and removing the items and restoring the site on which they are located; and
- capitalized borrowing costs.
Purchased software that is integral to the functionality of the related equipment is capitalized as part of that equipment.
Any gain or loss on disposal of an item of fixed assets (calculated as the difference between the net proceeds from disposal
and the carrying amount of the item) is recognized in profit or loss.

3.10.2 Subsequent costs
Subsequent costs is capitalized only when it is probable that the future economic benefits associated with the costs will flow
to the entity. Ongoing repairs and maintenance is expensed as incurred.
3.10.3 Depreciation
Items of fixed assets are depreciated from the date that they are installed and are ready for use, and in respect of internally
constructed assets, from the date that the asset is completed and ready for use.
Depreciation is calculated to write-off the cost/revalued amount of items of fixed assets less their estimated residual values
using either of straight-line method (SLM) or reducing balance method (RBM) over their estimated useful lives and recognized
in profit and loss. Land is not depreciated.
The estimated rate of depreciation for the current and comparative years of fixed assets are as follows:
Items Method Rates
Building Reducing balance 2.50%
Furniture and fixtures -Do- 10.00%
Mechanical appliances -Do- 20.00%
Books -Do- 30.00%
Motor vehicles Straight-line 20.00%
Computers -Do- 25.00%
Depreciation methods, useful lives and residual values are reviewed at each reporting date and adjusted if appropriate.
3.10.4 Intangible assets
An intangible asset is recognized if it is probable that the future economic benefits that are attributable to the asset will flow
to the entity and the cost of the assets can be measured reliably. Intangible assets is amortized using the straight line method
over the estimated useful life of 4 (four) years.
3.10.5 Capital work in progress
Fixed assets that is being under construction/acquisition is accounted for as capital work in progress until construction/
acquisition is completed and measured at cost. The work in progress is transferred to cost of that fixed assets when the
construction is completed and it becomes available for use.
3.10.6 Derecognition
An item of fixed assets is derecognized upon disposal or when no economic benefits are expected from its use or disposal. Any
gain or loss arising on derecognition of the asset is recognized in profit or loss.
3.11 Lease payments
Payments made under operating leases are recognized in profit or loss on a straight-line basis over the term of the lease.
3.12 Other assets
Other assets include all other financial assets, other income receivable, advance against expenses etc.

3.13 Non-banking assets
Non-banking assets are acquired on account of the failure of a client to repay the investment in time after receiving the decree
from the court regarding the right and title of the mortgaged property.
3.14 Impairment of non-financial assets
The carrying amounts of the non-financial assets, other than investment property and deferred tax assets, if any are reviewed
at each reporting date to determine whether there is any indication of impairment. If any such indication exists, then the asset’s
recoverable amount is estimated. An impairment loss is recognized if the carrying amount of an asset or cash-generating unit
(CGU) exceeds its recoverable amount. All intangible assets having infinite useful life, if any are tested for impairment at least
annually.
3.15 Deposits and other accounts
Deposit and other accounts include Al Wadeeah current deposit as well as savings, term and other Mudaraba deposits. Deposits
by customers and banks are recognized when the Bank enters into contractual agreements with the counterparties. These
items are brought to Financial Statements at the gross value of the outstanding balance.
3.15.1 Profit paid on deposits
As per Mudaraba principle, agreement between the Mudaraba depositors and the Bank, the Mudaraba depositors are entitled to
get minimum 65% of the investment income earned through deployment of Mudaraba Fund as per weightage assigned to each
type of Mudaraba deposit. In the year 2014, IBBL paid 71.48% of Investment Income earned through deployment of Mudaraba
Fund. In some Mudaraba Deposits, additional rate was allowed over the rate derived as per weightage. Mudaraba Depositors do
not share any income derived from various banking services where the their fund is not involved and any income derived from
Investing Bank’s Equity and other Cost Free Fund. Al-Wadeeah Depositors do not share any income of the Bank.
Profit is paid/provided to Mudaraba Deposit accounts at provisional rate on half-yearly/yearly/anniversary basis considering
overall projected growth, performance and profitability of the Bank during the year. Final Rates of profit of any accounting year
are declared after finalization of Shari’ah Inspection report and certifying the Investment Income of the Bank by the statutory
auditors.
3.16 Provisions
Provision is recognized if, as a result of a past event, the Companies has a present legal or constructive obligation that can
be estimated reliably, and it is probable that an outflow of economic benefits would be required to settle the obligation, in
accordance with the BAS 37 “Provisions, Contingent Liabilities and Contingent Assets”.
3.16.1 Provision for investments and off-balance sheet exposures
Provision for Investment for the year 2014 and 2013 is made as per instruction of Bangladesh Bank through BRPD Circular
No.14 dated 23 September 2012 and BRPD Circular No.19 dated 27 December 2012. However, for calculation of provision for
the year 2013, the amendments made by BRPD Circular No.05 dated 29 May 2013, BRPD Circular No.06 dated 29 May 2013,
BRPD Circular No.14 dated 18 December 2013 and BRPD Circular No.15 dated 23 December 2013 has been considered and
for the year 2014, the amendments made by BRPD Circular No.16 dated 18 November 2014 has been considered. Investments
have not been classified against which order staying classification has been issued by the Hon’ble High Court.
Provision for off-balance sheet exposures for the year 2014 and 2013 is also made as per latest instruction of Bangladesh Bank
through BRPD Circular No.14 dated 23 September 2012 and BRPD Circular No.19 dated 27 December 2012.

The rates of provision for the year 2014 and 2013 are given below:
2014 2013
Particulars Classification/Percentage (%) of provision requirement
UC SMA SS DF BL UC SMA SS DF BL
Small and Medium Enterprise (SME)

0.25% 0.25% 20% 50% 100% 0.25% 0.25% 20% 50% 100%
Financing
Investment for House Building &

Consumer 2% 2% 20% 50% 100% 2% 2% 20% 50% 100%
Professional
Other than House Building &

5% 5% 20% 50% 100% 5% 5% 20% 50% 100%
Professional
All Other (Except Short-term Agricultural and

1% 1% 20% 50% 100% 1% 1% 20% 50% 100%
Micro-Credits)
Short-term Agricultural and Micro-Credits 2.50% 5% 100% 5% 100%
Investment to Stock Dealers & Stock Broker 2% 20% 50% 100% 2% 20% 50% 100%
Off Balance Sheet exposures 1% 1%
3.16.2 Provision for other assets
Provision for other assets is made as per instruction of Bangladesh Bank through BRPD circular No.14 dated 25.06.2001.
3.16.3 Provision for nostro accounts
Provision for nostro accounts is to be made on the unreconciled debit balance of nostro account over more than 3 months as on
the reporting date in accordance with the guideline of Foreign Exchange Policy Department of Bangladesh Bank, FEPD Circular
no. FEPD (FEMO) / 01/2005-677 dated 13 September 2005. There was no unreconciled entries outstanding for more than 3
months and accordingly no provision has been made in this regard.
3.17 Employee benefits
3.17.1 The Bank provides various long-term and short-term benefits to the employees under different schemes.
A defined contribution plan is a post-employment benefit plan under which an entity pays fixed contributions to a separate entity
and has no legal or constructive obligation to pay further amounts. Obligations for contributions to defined contribution plan
are recognized as personnel expense in profit or loss in the periods during which related services are rendered by employees.
The Bank maintains one funded defined contribution plan for its employees - Provident fund.
3.17.1.1 Provident fund
The Provident Fund is for the regular and confirmed employees who works for a minimum period of 5(five) years at IBBL and
it came into force with effect from 1st day of March 1986. The fund receives contributions @ 10% of the basic pay both from
employees and employer.
3.17.2 Defined benefit plans
A defined benefit plan is a post-employment benefit plan other than a defined contribution plan. The Bank’s net obligation
in respect of defined benefit plans is calculated separately for each plan by estimating the amount of future benefit that
employees have earned in return for their service in the current and prior periods. The Bank has two funded defined benefit
plans - Gratuity fund and Superannuation fund.

3.17.2.1 Gratuity fund
The Gratuity Fund for the regular and confirmed employees of IBBL was established on 1st day of March 1986. The employees
who serve at least 7 (seven) years at IBBL are normally entitled to get gratuity equivalent to 1(one) month’s basic pay. Employees
served for minimum 12 years get 1.5 (one and a half) months’ basic pay and employees served for 20 years get 2 (two) months’
basic pay. Adequate contributions have been made as per the recommendation of actuarial valuation report and our analysis
during the year. Actuarial valuation of the gratuity fund was conducted up to the year 2014 by professional actuary which
shows sufficient amount of surplus fund available at the valuation date.
3.17.2.2 Superannuation fund
The Fund came into force with effect from the 19 June, 2008. It was established for financial help to the members of the IBBL
Employees’ Superannuation Fund and their families in case of retirement, death, physical disability of employee while in service
or of any incidence of like nature acceptable to the Board of Trustees and retirement from the service. During the year 2014,
Tk.20.00 million has been provided by the Bank to the Fund. Actuarial valuation of the superannuation fund was conducted
up to the year 2014 by professional actuary which shows sufficient amount of surplus fund available at the valuation date.
3.17.3 Short-term employee benefits
Short-term employee benefit obligations are measured on an undiscounted basis and are expensed as the related service is
provided. A liability is recognized for the amount expected to be paid if the Companies has a present legal or constructive
obligation to pay this amount as a result of past service provided by the employee, and the obligation can be estimated reliably.
3.17.4 Other employee benefits
Other employee benefits include which are not included in short-term employee benefits, post-employment benefits and other
termination benefits.
3.17.4.1 Benevolent fund
The Benevolent Fund for the regular and confirmed employees of the Bank was established in the year 1986. This Fund is
mainly used for payment of scholarship to the meritorious students among the children of IBBL’s officers and sub-staff, to
allow short term quard/grant to meet some unexpected and specific needs of the staff of IBBL like accident, clinical treatment,
marriage ceremony of the employees and their dependents etc. The Bank contributed Tk.10.00 million to the fund during the
year 2014 .
3.17.5 Workers’ Profit Participation Fund (WPPF)
As per Bangladesh Labour Act, 2006 as amended in 2013 all companies fall within the scope of WPPF (which includes Bank)
are required to provide 5% of its profit before charging such expense to their eligible employees within the stipulated time. The
Bank obtained opinion from its legal advisor regarding this issue which stated that the Bank is not required to make provision
for WPPF as the provision of Bangladesh Labour Act 2006 as amended contradicts with that of the Bank Company Act 1991.
As such the Bank did not make any provision during the year for WPPF.
3.18 Share capital and reserves
3.18.1 Capital
3.18.1.1 Authorized Capital
Authorized Capital is the maximum amount of share capital that the Bank is authorized to raise as per its Memorandum and
Articles of Association.

3.18.2 Share Premium
Share premium arose from sale of some un-subscribed Right Share for the year 1996 at above the par value and can be utilized
as per section 57 of the Companies Act, 1994.
3.18.3 Statutory reserve
As per section 24 of the Bank Company Act, 1991 as amended, at least 20% or more of the net profit before tax is transferred
to statutory reserve every year until the balance of the reserve equates with the paid-up capital.
3.18.4 Assets revaluation reserve
This represents the difference between the book value and the re-valued amount of premises (Land and Building) of the Bank
as assessed by professional valuers in the year 2000, 2002, 2003, 2004, 2005, 2006, 2009 and 2012 as per guideline issued by
Bangladesh Bank, which was reviewed by the statutory auditors. This reserve is not distributable. However, to calculate Capital
Adequacy Ratio (CAR), 50% of the same is considered as a component of supplementary capital as per Bangladesh Bank BRPD
Circular No. 24 dated 03 August 2010.
3.18.5 Revaluation reserve of securities
Investment in shares of Bangladesh Shipping Corporation is held for fulfillment of Statutory Liquidity Reserve (SLR) as per
Bangladesh Bank Letter No. BCD (P)744(23)(II)/1030 dated 08.11.1983, BRPD Circular No.15 dated 31.10.2005, DOS Circular
Letter No.10 dated 11.09.2006, BRPD Circular No.03 dated 12.03.2008 and DOS Circular Letter No.05 dated 26.05.2008. The
shares have been revalued as on 30.12.2014 on the basis of closing market price of Dhaka Stock Exchange Limited (DSE).
The surplus is credited to Revaluation Reserve on securities account (Note - 3.8.3) and 50% of the same has been taken as a
component of Supplementary Capital as per Bangladesh Bank BRPD Circular No. 24 dated 03 August 2010. and shown in the
Statement of Changes in Equity as per Bangladesh Bank guidelines. However, deficit arising on such revaluation is debited to
Revaluation reserve on securities account.
3.18.6 Non-controlling interest
Non-controlling interest is the portion of the profit or loss and net assets of the subsidiaries of IBBL (Islami Bank Securities
Limited & Islami Bank Capital Management Limited) that is not owned by the Parent (IBBL). Non-controlling interest belongs
to other investors and is reported on the consolidated balance sheet of the parent Company (IBBL) to reflect the claim
on assets belonging to other, non-controlling shareholders. Also, non-controlling interest is reported on the consolidated profit
and loss account as a share of profit belonging to non-controlling shareholders.
3.19 Subordinated debt-Mudaraba Perpetual Bond (MPB)
Mudaraba Perpetual Bond (MPB) was issued by the Bank under the mudaraba principles of Islamic Shari’ah as per approval
of Bangladesh Bank Letter No. BRPD (P-1)661/14(a)/2006-1437 dated 07.05.2006 and Bangladesh Securities and Exchange
Commission Letter No. SEC/CI/CPLC-118/2006/385 & SEC/CI/RPO-01/2007/386 both dated 10.06.2007. The Investment
Corporation of Bangladesh (ICB) is the Trustee of the MPB. The MPB is listed with Dhaka Stock Exchange Ltd. & Chittagong
Stock Exchange Ltd. and trading of the same started from 25 November 2007. It is treated as a component of Supplementary
Capital as Subordinated Debt. The instrument having face value of Tk.1,000 each is subordinated to the claims of other creditors
and depositors. In the case of liquidation the subordinated debt holders would be paid just before paying to the shareholders
assuming there are assets to distribute after all other liabilities and debts have been paid. The Mudaraba Perpetual Bond (MPB)
is perpetual in nature i.e.infinite maturity. Profit paid against Mudaraba Perpetual Bond is at the final profit rate of 8 (eight) years
Mudaraba Savings Bond and an additional amount equivalent to 10.00% of the rate of dividend declared for the respective year.
3.20 Other liabilities
Other liabilities comprise items such as provision for investment, provision for taxes, profit/rent suspense, accrued expenses,
etc. Other liabilities are recognized in the balance sheet as per guidelines of Bangladesh Bank, Bangladesh Financial Reporting
Standards (BFRS) etc.

3.21 Contingent liabilities
Any possible obligation that arises from past events and the existence of which will be confirmed only by the occurrence or
non-occurrence of one or more uncertain future events not wholly within the control of the Bank; or
Any present obligation that arises from past events but is not recognized because, it is not probable that an outflow of resources
embodying economic benefits will be required to settle the obligation, is considered as contingent liability.
Contingent liabilities are not recognized but disclosed in the financial statements unless possibility of an outflow of resources
embodying economic benefits is reliably estimated. Contingent assets are not recognized in the financial statements as this
may result in the recognition of income which may never be realized.
3.22 Off-balance sheet items
Off-balance sheet items are disclosed under Contingent liabilities & other commitments and required provision on Off-balance
sheet exposures have been made in accordance with Bangladesh Bank guidelines (Note 3.16.1).
3.23 Earnings per share (EPS)
The Bank presents basic and diluted (when dilution is applicable) earnings per share (EPS) for its ordinary shares. Basic EPS
is calculated by dividing the profit or loss attributable to ordinary shareholders of the Bank with the weighted average number
of ordinary shares outstanding during the period, adjusted for the effect of change in number of shares for bonus issue, share
split and reverse split. Diluted EPS is determined by adjusting the profit or loss attributable to ordinary shareholders and the
weighted average number of ordinary shares outstanding, for the effects of all dilutive potential ordinary shares. However,
dilution of EPS is not applicable for these financial statements as there was no dilutive potential ordinary shares during the
relevant periods. Hence no Diluted EPS has been calculated. Consolidated basic EPS has also been calculated and presented
in the same manner.
3.24 Segment reporting
An operating segment is a component of the Bank that engages in business activities from which it may earn revenues and
incur expenses, including revenues and expenses that relate to transactions with any of the Bank’s other components. All
operating segments’ operating results are reviewed regularly by the Bank’s Management (as being the chief operating decision
maker) to make decisions about resources to be allocated to the segment and to assess its performance, and for which discrete
financial information is available.
Segment results that are reported to the Management include items directly attributable to a segment as well as the items that
can be allocated on a reasonable basis. Segments which are reportable is analyzed at the end of the financial year. Comparative
information is provided for newly reportable segments but no current year information is provided for segments which are non-
reportable in current year even it was reportable in previous year as per BFRS 8 “Operating Segments”.
Details about segment reporting has been given at Annexure - D
3.25 Off-setting
The value of any asset or liability as shown in the balance sheet is not off-set by way of deduction from another liability or
assets unless there exist legal right thereof. Financial assets and financial liabilities are offset and the net amount is presented
in the balance sheet when there is a legally enforceable right to offset the recognized amounts and there is an intention to
settle on a net basis, or realize the asset and settle the liability simultaneously. Income and expenses are presented on a net
basis only when permitted under BFRS, or for gains or losses arising from a similar transactions.
3.26 Materiality and aggregation
Each material class of similar items is presented separately in the financial statements. Items of dissimilar nature or function
are presented separately unless they are immaterial as permitted by BAS 1 “Presentation of Financial Statements”.

3.27 Inter-branch transactions
Transactions with regard to inter-branches and units are reconciled regularly and efforts are taken to minimize the unreconciled
entries at the end of the year.
3.28 Revenue, gains, expenses & losses prohibited by Shari’ah
Doubtful income which is prohibited by Shari’ah due to lapses in compliance of Shari’ah principles for investment as per Shari’ah
Supervisory Committee report is included in the investment income of the Bank and appropriate amount of corporate tax is
paid on it accordingly on these whole amount whether realized or not. It is not distributed to either depositors or shareholders
of the Bank rather the amount net of corporate tax is transferred to an account titled “Doubtful income account’ under other
liabilities of the Bank. Only realized amount of doubtful income (on which corporate tax has already been paid due to inclusion
in investment income) is then expended for charitable purposes.
Bank charges compensation on overdue investments under Bai-modes. The total amount of compensation is not included
in investment income rather kept separately under other liabilities. However, tax on these amount duly considered. Realized
amount of compensation (on which corporate tax has already been paid due to inclusion in investment income) are expended
for charitable purposes.
Interest received from the balances held with foreign banks and from foreign currency clearing account with Bangladesh
Bank are not credited to income, since it is not permissible as per Shari’ah. These are expended for charitable purposes after
payment of corporate income tax thereon.
3.28.1 Doubtful income account
Doubtful income was temporarily used to create provision as per decision of Shari’ah Supervisory Committee till 2013. And
realized amount were transferred/utilized for charitable purposes. However, from the year 2014 the Bank has decided to
introduce a separate account after payment of corporate income tax whether realized or not. Accordingly, from this year, net
of corporate tax amount of doubtful income has been transferred to “doubtful income account” as a charge in profit & loss
account under other provisions (Note 16.3.2).
3.29 Dividend payments
Final dividend is recognized when it is approved by the shareholders in Annual General Meeting (AGM). The proposed dividend
for the year 2014, therefore, has not been recognized as a liability however disclosed in the balance sheet in accordance
with BAS 10 “Events after the Reporting Period”. Dividend payable to the Bank’s shareholders is recognized as a liability and
deducted from the shareholders’ equity in the period in which the shareholders’ right to receive the dividend is established.
3.30 Events after the reporting period
All material events after the reporting period that provide additional information about the Companies’/Bank’s position at the
balance sheet date are reflected in the financial statements as per BAS 10 “Events after the Reporting Period”. Events after the
reporting period that are not adjusting events are disclosed in the notes when material (Note - 39).

3.31 Risk management
The Bank Company Act, 1991 as amended and the Bangladesh Bank Regulations require the Management to ensure effective
internal audit, internal control and risk management functions of the Bank. The Management is also required to make a self-
assessment on the effectiveness of anti-fraud internal controls and report to Bangladesh Bank on instances of fraud and
forgeries.
Department of Off-site Supervision (DOS) of Bangladesh Bank issued Circular No.-02 dated 15 February 2012 on Risk
Management Guidelines for Banks and instructed all scheduled banks operating in Bangladesh to follow this Guidelines for
managing various risks which have been complied by the Bank.
In addition, the Bank is also following relevant Bangladesh Bank guidelines on risk based capital adequacy, supervisory review
process, stress testing and managing the banking risks in other core risk areas.
The risk of a bank is defined as the possibility of losses, financial or otherwise. The Risk Management of the Bank covers 6
(six) Core Risk Areas of Banking industry i.e. Investment (Credit) Risk , Foreign Exchange Risk, Asset-Liability Management,
Prevention of Money Laundering, Internal Control & Compliance Risk and Information & Communication Technology Risk. The
risk management procedures in the core risk areas have been devised in line with the core risk management guidelines of
Bangladesh Bank. All the Risk Management Guidelines are periodically reviewed by the Bank and Bangladesh Bank periodically
inspects the implementation status of these guidelines and as per the reports of Bangladesh Bank, IBBL is well compliant in
Core Risk Management activities.
In line with instruction of Bangladesh Bank, IBBL formed a Risk Management Wing (RMW) to formulate risk assessment and
management policies, methodologies, guidelines and procedures for risk identification, risk measurement, risk monitoring,
deciding acceptable level of risk and risk controlling. Risk management function involves identification, assessing, taking
mitigating steps, preparing Risk Management Paper (RMP), conducting monthly risk management meeting, stress testing and
reporting the competent authority from time to time. It also reports to Bangladesh Bank on quarterly basis along with the RMP,
minutes of the monthly meeting and all other required supporting papers. Moreover, in compliance with the “Bank Company
Act 1991 as amended”, Section 15 (Kha) and BRPD Circular No. 11 dated 27 October, 2013 of Bangladesh Bank, the Bank has
constituted a Risk Management Committee comprising of 5 (five) directors from the Board to formulate risk management
policies, procedures and oversee the risk management activities of the Bank.
The prime objective of the Risk Management is that the Bank takes well calculative Business Risk Policy for safeguarding
the Bank’s capital, its financial resources and profitability from various risks. In this context, the Bank implemented all the
guidelines of Bangladesh Bank as under:
3.31.1 Internal Control and Compliance
Operational loss may arise from errors and frauds due to lack of internal control and compliance. With a view to overcome such
lapses and verification of asset quality, ensure quality of customer service, overall security arrangement, operational efficiency
and compliance of regulatory issues as guided through different circulars, manuals from Head Office and other regulatory
bodies. Bank organizes its management through Internal Control & Compliance Wing (ICCW) which consists of three Divisions
namely (1) Audit & Inspection Division, (2) Compliance Division and (3) Monitoring Division.
(1) Audit & Inspection Division
Internal Audit & Inspection Division undertakes periodical and special audit of the Branches, Divisions and Departments of
Head Office to review operational effectiveness and internal & external compliance requirements. The Bank has introduced Risk
Based Internal Audit and grading of the branches. The Audit Committee of the Board subsequently reviews the lapses identified
by Audit and Inspection Division. The Audit Committee also reviews Bangladesh Bank Inspection Reports and other issues
indicated in the guidelines prescribed by Bangladesh Bank. Necessary steps/measures are taken on the basis of observations
& suggestions of the Committee.
The Audit & Inspection Division conducts investigations against complaints received from customers, anonymous persons,
management & others and submits the reports to the competent authority. Periodical Inspection reports of Zonal Heads,
Shari’ah Inspections & Branch Manager’s self Audit are also reviewed by the Division regularly and necessary guidances and
suggestions are given with continuous follow-up thereagainst.

(2) Compliance Division
The Compliance Division handles the ‘regulatory issues of Bangladesh Bank as well as other regulatory bodies’ and submits
‘status report on regulatory compliance’ quarterly to the Audit Committee as per BRPD Circular No.12 dated 23.12.2002.
The Compliance Division ensures that the Bank complies with all regulatory requirements while conducting its day to day
business. The Compliance Division maintains liaison with the regulatory bodies for any regulatory changes and notify the same
to all concerned.
(3) Monitoring Division
This Division performs the following:
i) Assesses the risk of the functional areas of the Branches described in the Departmental Control Function Checklist (DCFCL)
and determines the frequency of Audit/Inspection of the branches based on the gravity of risks involved.
ii) Monitors the Internal Control Functions through the Quarterly Operations Report (QOR) and other mechanisms.
iii) Checks the completion/execution of Investment Documentation.
3.31.2 Foreign Exchange Risk Management
Foreign Exchange Risk is the current or prospective risk to earnings and capital arising from adverse movements in currency
exchange rates. The Bank is exposed to profit rate risk and settlement risk on account of its foreign exchange business. Foreign
Exchange business includes trading of foreign currencies relating to import, export, remittances and other ancillary services.
IBBL is dealing with a substantial volume of foreign trade and remittance business of the country which exposes the Bank to
foreign exchange risk. IBBL has adopted foreign exchange risk manual through which the foreign exchange operations are
dealt with.
Foreign Exchange risks are measured and monitored by the Treasury Division. Treasury Division consists of separate Front
Office, Back Office and Mid Office. The Treasury Front Office (Dealing Room) independently performs the deals and the Treasury
Back Office is responsible for verification of the deals and passing of their entries in the books of account.
The Foreign Exchange Risk is minimized through proper market analysis, real time pricing of Foreign Exchange, fixation of
different market related limits (daylight, overnight, stop loss and management action trigger) and counter parties credit limits
set by the management and ensure adherence to the limits by the Treasury Front Office. All Foreign Exchange transactions are
revalued at weighted average exchange rate as provided by Bangladesh Bank at the end of each month. All Nostro Accounts
are reconciled regularly and outstanding entries are reviewed by the management for its settlement/recompilation. The open
position maintained by the bank at the end of the day remains within the stipulated limit prescribed by the Bangladesh Bank.
3.31.3 Investment (Credit) Risk Management
Investment (Credit) risk is one of the major risks faced by the Bank. This can be described as potential loss arising from the
failure of counter party to perform as per contractual agreement with the Bank. The failure may result from unwillingness or
inability of the counter party in discharging his / her financial obligation. Therefore, Bank’s Investment (Credit) risk management
activities have been designed to address all these issues. IBBL has designed its own operational manuals for each modes
and products. It has also designed its own investment risk management guideline which is compatible with the regulatory
guideline and islamic modes of finance. There is a dedicated committee namely “Investment Risk Management Committee”
which periodically reviews the operational manuals and risk management guidelines and ensures compliance of the same.
3.31.4 Asset Liability Management
The Asset Liability Committee (ALCO) of the Bank monitors balance sheet risk, liquidity risks, investment deposit ratio (IDR),
deposit mix, investment mix, gap analysis etc. under the leadership of MD & CEO of the Bank. Asset Liability Committee
(ALCO) reviews liquidity requirement of the Bank, the maturity of assets and liabilities, deposit and investment pricing strategy,
sensitivity of assets and liabilities, management indicators/ratios and the liquidity contingency plan. The primary objective of
the ALCO is to monitor and avert significant volatility in Net Investment Income (NII), investment value and exchange earnings.

3.31.5 Prevention of Money Laundering
Money Laundering risk is defined as the loss of reputation and expenses incurred as penalty for being negligent in prevention
of money laundering. For mitigating the risks, the Bank has formed 05(five) members Central Compliance Unit (CCU) under
the leadership of the Chief Anti Money Laundering Compliance Officer (CAMLCO) at Head Office. Anti Money Laundering
Compliance Units are also functioning at Zonal Offices and Branches, where the transactions of the accounts are independently
reviewed to verify Suspicious Transaction Reports (STRs). A Manual for prevention of money laundering was developed and
approved by the Board of Directors. IBBL has introduced (a) Uniform Account Opening Form (AOF), (b) Know Your Customer
(KYC) Profile and (c) Transaction Profile (TP) in the Bank as per instructions of Bangladesh Bank. IBBL had already issued 6
(six) instruction circulars and 11 (eleven) circular letters providing necessary instructions for Prevention of Money Laundering
activities and also for combating of Financial Terrorism.
Moreover, IBBL had conducted a good number of training sessions/workshops to create awareness and development of the
skill of the officials for identifying suspicious transactions. IBBL introduced a Policy Guideline to combat terrorist financing in
the light of Anti Terrorism Act (Amendment) Act, 2012 coupled with the Money Laundering Prevention Act- 2012 approved by
the Board of Directors of the Bank.
IBBL has exclusively completed the KYC procedures of Legacy Accounts (accounts opened before 30 April 2002). To establish
fruitful Anti Money Laundering drive at branch level, IBBL introduced AML Rating systems such as excellent/good/satisfactory/
marginal through self Assessment Report & Independent Testing Procedure as per instruction of Bangladesh Bank.
3.31.6 Information and Communication Technology Risk Management
The Bank has adequately addressed Information and Communication Technology (ICT) Risk Management. It is an in-depth
exercise and continual process. The (ICT) Risk Management exercise mainly includes minimizing financial and image loss to
the institution in all events such as natural disasters, technological failures, human errors etc. The Bank uses own developed
Core Banking Software to perform all types of transactions including local/ online/ internet in a secured way. To take care of
its core banking system, a separate security module has been incorporated in the software which manages different roles/
privileges for different users. All financial transactions can be tracked for future audit purposes.
The Bank uses Central Data Centre to replicate transactions in branches in case of data failure or inconsistencies. Data
travelling through network uses encryption and decryption mechanism.
In line with the Bangladesh Bank directives, the Bank has approved its own ICT policies for its operations and services. Under
these policy guidelines, a security policy has also been worked out. To abide by and adhere to what is laid down in the policy; the
implementation has been made through Active Directory Services (ADS), Password Policy, Kerberos Policy, Audit Policy, Group
Policy, User Rights, Permission Policy etc. In order to secure network resources from public network, the Bank has introduced
Virtual Private Network (VPN), Access Control List (ACL), IP filtering and TCP/UDP service blocking through router and firewall
devices. It has already centralized the administrative control to access the network, mailing system and internet. IBBL has
introduced Business Continuity Plan (BCP) for its entire network and trained the officials to cope up with any contingencies.
3.31.7 Internal audit
Internal Audit is used as an important element to ensure good governance of IBBL. Internal Audit activity of IBBL is effective
and it provides senior management with a number of important services. These include detecting and preventing fraud, testing
internal control, and monitoring compliance with own policies & procedures, applicable rules & regulations, instructions/
guidelines of regulatory authority etc.
During the year 2014, Audit Division of Internal Control & Compliance Wing conducted inspection on most of the Branches/
Divisions of Head Office of the Bank and submitted reports presenting the findings of the audits/ inspections. Necessary control
measures and corrective actions have been taken on the suggestions or observations made in these reports. The reports or
key points of the reports have also been discussed in the meetings of the Audit Committee of the Board and necessary steps
have been taken according to the decision of the said Committee for correct functioning of Internal Controls & Compliance.

3.31.8 Fraud and forgeries
Fraud means wrongful or criminal deception intended to result in financial or personal gain. It will never be possible to eliminate
all frauds and no system is completely fraud proof, since many fraudsters are able to bypass control systems put in place.
IBBL continuously pays attention to implement and improve the anti-fraud internal controls for prevention of fraud and forgery.
IBBL assesses /evaluates the effectiveness of its Anti-Fraud Internal Control measures on quarterly basis as per the items/
areas mentioned in the prescribed checklist of Bangladesh Bank. During the year 2014, 5 (five) incidents of fraud at 4 (four)
different branches have been detected by the Bank and it has duly been reported to Bangladesh Bank. The Bank has already
made adequate provision in this regard.
3.32 Credit rating report
Credit Rating Information and Services Ltd. CRISL was engaged by the Bank for the purpose of rating the Bank since 2002 as
per Bangladesh Bank BRPD Circular No.06 dated 5 July 2006. CRISL assigned AA+ rating in the long term (indicates high safety
and high credit quality) and ST-1 in the short term (highest certainty of timely repayment) to IBBL based on the financials up
to 31 December 2013.
3.33 Regulatory and legal compliance
Among others, the Bank complied with the requirements of the following circular, rules and regulations:
a) The Bank Company Act, 1991 as amended
b) The Companies Act, 1994
c) BRPD Circular No. 14 dated 25.06.2003 and “Guidelines for Islamic Banking” issued by Bangladesh Bank through BRPD
Circular No. 15 dated 09.11.2009
d) Other circulars, rules and regulations issued by Bangladesh Bank from time to time
e) The Securities and Exchange Rules, 1987
f) The Securities and Exchange Ordinance, 1969
g) The Securities and Exchange Commission Act, 1993
h) Income Tax Ordinance, 1984
i) VAT Act, 1991
j) Standards issued by AAOIFI
k) The Stamp Act-1899
l) The Customs Act-1969
m) The Money Laundering Prevention Act, 2012
n) The Anti Terrorism (Amendment) Act, 2013 etc.

4.0 Compliance with Financial Reporting Standards as applicable in Bangladesh
The Companies/Bank complied, as per Para 12 of Securities & Exchange Rule 1987, with the following Bangladesh Accounting
Standards (BASs) and Bangladesh Financial Reporting Standards (BFRSs) as adopted by The Institute of Chartered Accountants
of Bangladesh (ICAB) in preparing the financial statements of IBBL subject to departure described in note - 2.1, where we have
followed Bangladesh Bank guidelines:
Sl. No. BFRS No. BFRS Title Compliance Status
First-time adoption of International Financial Reporting

1 1 Not Applicable
Standards
2 2 Share-based Payment Not Applicable
3 3 Business Combinations Not Applicable
4 4 Insurance Contracts Not Applicable
Non-current Assets Held for Sale and Discontinued

5 5 Not Applicable
Operations
6 6 Exploration for and Evaluation of Mineral Resources Not Applicable
7 7 Financial Instruments: Disclosures Complied
8 8 Operating Segments Complied
9 10 Consolidated Financial Statements Complied
10 11 Joint Arrangements Not Applicable
11 12 Disclosure of Interests in other Entities Complied
12 13 Fair Value Measurement Complied

Compliance with Bangladesh Accounting Standards as applicable in Bangladesh (Contd…)
Sl. No. BAS BAS Title Compliance Status

No.
1 1 Presentation of Financial Statements Complied
2 2 Inventories Not Applicable
3 7 Statement of Cash Flows Complied
4 8 Accounting Policies, Changes in Accounting Estimates and Errors Complied
5 10 Events after the Reporting Period Complied
6 11 Construction Contracts Not Applicable
7 12 Income Taxes Complied
8 16 Property, Plant & Equipment Complied
9 17 Leases Complied
10 18 Revenue Complied
11 19 Employee Benefits Complied
12 20 Accounting for Government Grants and Disclosure of Government Not Applicable
Assistance
13 21 The Effects of Changes in Foreign Exchange Rates Complied
14 23 Borrowing Costs Not Applicable
15 24 Related Party Disclosures Complied
16 26 Accounting and Reporting by Retirement Benefit Plans Not Applicable
17 27 Separate Financial Statements Complied
18 28 Investments in Associates and Joint Ventures Not Applicable
19 29 Financial Reporting in Hyperinflationary Economics Adopted and effective on or
after 01 January 2015 but
not applicable for the Bank
20 31 Interest in Joint Ventures Not Applicable (Replaced
with IFRS/BFRS 11)
21 32 Financial Instruments: Presentation Complied
22 33 Earnings per Share Complied
23 34 Interim Financial Reporting * Complied
24 36 Impairment of Assets Complied
25 37 Provisions, Contingent Liabilities and Contingent Assets Complied
26 38 Intangible Assets Complied
27 39 Financial Instruments: Recognition and Measurement Complied
28 40 Investment Property Not Applicable
29 41 Agriculture Not Applicable
(*) Complied while the quarterly and half-yearly interim financial reports were prepared during the year as per regulations of
Bangladesh Securities and Exchange Commission (BSEC).

5.0 Audit committee
As per Bangladesh Bank BRPD circular No.11 dated 27 October 2013, the Audit Committee was formed by the Board of
Directors of the Bank consisting of the Board Members. As at 31 December 2014 the following directors were the members of
the Audit Committee:
Sl. Name of the Member Status with the Status with the Educational Qualification
No. Bank Committee
1 Prof. NRM Borhan Uddin, Ph.D. Independent Chairman B.Com (Hon’s), M.Com (Management) C.U.
Director MBA, M.S, Ph.D (USA) in Management
2 Janab Md. Abdus Salam, FCA, FCS Independent Member B.Com (Hon’s), M.Com (Accounting) D.U,
Director FCA, FCS
3 Dr. Areef Suleman Director Member Masters in Economics, Masters
in Business Leadership & Ph.D. in
Economics.
4 Janab Barrister Mohammed Independent Member L.L.B. (Hons), L.L.M, PGDL (UK), Barrister-
Belayet Hossain Director at-law
Audit Committee of the Board met in 24 occasions in the year 2014. They met in 04 occasions regarding finalization of financial
statements for the year 2014 with the Senior Management of the Bank and external auditors in which among others, the following
issues were discussed:
(i) The Committee examined the financial statements of 2014 of the Bank to see whether all the disclosures and
information have been incorporated in the financial statements & whether the Bank followed Bangladesh Financial
Reporting Standards (BFRSs) and other procedures in preparing financial statements.
(ii) In finalizing the financial statements for the year 2014, several alternatives and various pertinent issues, such as
impact of doubtful income, dividend, compensation, profit paid on deposits (PPD), Capital Adequacy Ratio (CAR) &
Risk Weighted Assets (RWA) etc. were considered by the Audit Committee.
(iii) The Committee discussed the management letter issued by the external auditors and details Inspection Report
submitted by Bangladesh Bank, compliance status of those reports, internal check & control systems and provided
appropriate guidelines to the Management for overall improvement of the Management and Accounting system and
minimization of various types of risks.
(iv) Like previous years, the Committee also exchanged views with the statutory auditors and management of the Bank
before finalization of the financial statements of the Bank.
6.0 Related party disclosures
As per BAS 24 “Related Party Disclosures”, a related party is a person or entity that is related to the entity (i.e. IBBL) that is
preparing its financial statements. Related party transaction is a transfer of resources, services, or obligations between a
reporting entity and a related party, regardless of whether a price is charged as per BAS 24.
Related Parties include the Bank’s Directors, key management personnel, associates, companies under common directorship
etc. as per BAS 24 “Related Party Disclosures”. All transactions involving related parties arising in the normal course of business
are conducted at arm’s length at normal commercial rates on the same terms and conditions as third party transactions using
valuation modes, as admissible.
6.1 Lending policy for transactions with Bank related person/related parties
Transactions with Bank related person/related parties including Directors are made as per rules and regulations of the Bank
Company Act 1991 as amended and as per circulars issued by Bangladesh Bank time to time including the following general rules:
i) Terms & conditions for financial transaction with bank related person/related parties will not be easier than other
persons i.e. other Investment clients.
ii) Prior approval from the majority of Board of Directors shall be required for all financial transactions with bank related
person/related parties.
iii) The Bank shall not allow funded facilities exceeding 10% of Tier -1 capital to the Bank related persons/related parties;
real investment facilities shall be considered deducting encashable securities from funded investment.

6.2 Name of the Directors along with all related Firms/ Companies/ Institutions/Parties as at 31 December 2014:
Status with Name of the related Firms/

Sl. No Name of the Directors Remarks
the Bank Companies/ Institutions/ Parties etc.
1 Janab Abu Nasser Muhammad Abduz Zaher, Chairman The Ibn Sina Trust, The IBN Sina
Representative of the Ibn Sina Trust, Pharmaceutical Ind. Ltd. and
Manarat Trust.
2 Janab Yousif Abdullah Al-Rajhi Vice- Not applicable Foreign Director

Vice – Chairman Chairman
3 Engr. Mustafa Anwar, Representative of the Vice- Birds Group

Public Institution for Social Security, Kuwait. Chairman
4 Janab Abdullah Abdul Aziz-Al-Rajhi Director Not applicable Foreign Director
5 Dr. Areef Suleman Representative of of Director Islamic Development Bank, K.S.A. Foreign Director
Islamic Development Bank, K.S.A.
6 Janab Mohammed Abdullah Al Jalahma, Director Kuwait Awqaf Public Foundation, Foreign Director
Representative of Kuwait Awqaf Public Kuwait
Foundation, Kuwait.
7 Janab Salahuddin Ahmed Representative of Director Kuwait Finance House, Kuwait. Foreign Director
Kuwait Finance House, Kuwait.
8 Dr. Abdulhameed Fouad Al-Khateeb, Director Arabsas Travel & Tourist Agency, KSA. Foreign Director
Representative of Arabsas Travel & Tourist
Agency, KSA.
9 Engr. Md. Eskander Ali Khan Representative Director KEARI Limited,

of Al-Rajhi Co. for Industry & Trade, K.S.A.
10 Janab Md. Abul Hossain Representative of Director Investment Corporation of

Investment Corporation of Bangladesh. Bangladesh (ICB).
11 Janab Md. Abdus Salam, FCA, FCS Director Not applicable Independent
Director
12 Janab Humayun Bokhteyar, FCA. Director Not applicable Independent

Director
13 Prof. NRM Borhan Uddin Ph.D Director Not applicable Independent

Director
14 Prof. Dr. A.K.M Sadrul Islam Director The Ibn Sina Trust. Independent
Director
15 Barrister Mohammed Belayet Hossain Director Jurists Consortium Independent

Director
16 Janab Mohammad Abdul Mannan Ex-Officio Not applicable Managing Director

Director

6.3 Related party balances and transactions
6.3.1 Related party balances
a) Nature and type of balances and transactions of related parties (Directors) of the Bank are as follows:
Amount in Taka
SL. Name of the Name of the Director Relationship Purpose Classified Outstanding Disbursement/ Realised Outstanding
No. Account/Firm/ of the Position balance charged during during the balance
Trust etc. Director with as on the year year as on
the Firm/ 01.01.2013 31.12.2014
Trust etc.
1 2 3 4 5 6 7 8 9 10=7+8-9
1 Fouad Prof. Abu Nasser Director HPSM Un 17,774,009 1,453,443 3,401,000 15,826,452
Al-Khateeb Muhammad Abduz (Project) Classified
Hospital Zaher (Chairman)
2 Ibn Sina Trust Prof. Abu Nasser Member of Purchase - do- 417,145,385 45,468,344 98,811,472 363,802,257
Muhammad Abduz Board of of House,
Zaher (Chairman) and Trustee BMRE &
Prof. Dr. A.K.M Sadrul Import of
Islam (Independent Machinery
Director).
3 Ibn Sina Prof. Abu Nasser Director Bank - do- 244,036 - - 244,036
Pharmaceutical Muhammad Abduz Guarantee
Ind. Ltd. Zaher (Chairman), Prof.
Dr. A.K.M Sadrul Islam
(Independent Director)
and Md. Abdus Salam,
(Independent Director)
4 Mrs. Shahanara Engr. Md. Eskander Ali Husband Housing - do- 1,643,834 142,683 366,600.00 1,419,917
Begum Khan (Director)
5 Mohammad Jb. Mohammad Abdul Himself Housing - do- 4,297,265 494,593 852,000.00 3,939,858
Abdul Mannan Mannan Managing
Director & Ex - Officio
Director
6 Barrister Independent Director Himself Purchase of - do- 3,163,520 185,446 234,640.00 3,114,326
Mohammed Commercial
Belayet Hossain Flat
Total 444,268,049 47,744,509 103,665,712 388,346,846
(b) Other type of balances of related parties of the Bank are as follows:
SL. Name of the related parties Nature of Nature of transactions Closing balance (Taka)
No. relationship
31.12.2014 31.12.2013
1 Islami Bank Securities Limited (IBSL) Parent- subsidiary Investment in Share capital by IBBL 2,699,946,000 2,699,946,000
Bank balance 39,970,915 112,512,177
MTDR balance 886,152,827 889,006,145
Quard balance 90,000,000 200,000,000
Profit receivable 11,218,112 15,075,838
Mudaraba investment 3,000,000,000 -
Accounts payable 7,023,067 93,055,051
Office rent payable 67,689 -
2 Islami Bank Capital Management Parent- subsidiary Investment in Share capital by IBBL 299,993,000 299,993,000
Limited
Bank balance 45,421,630 3,813,310
Dividend payable 104,997,550 -

6.3.2 Related party transactions
Nature and type of related party transactions of the Bank during the year 2014 are as follows:
SL. Name of the related Nature of relationship Nature of transaction 2014 (Taka)
No. party
1 Islami Bank Securities Parent- subsidiary Deposit to Savings account maintained with IBBL 3,630,708,197
Limited (IBSL) Withdraw from Savings account maintained with 3,630,323,619
IBBL
Deposit to Current account maintained with IBBL 621,004,225
Withdraw from Current account maintained with 692,190,267
IBBL
Bank charge paid to IBBL 3,829
Payment against office rent 406,134
Profit against MTDR 57,286,496
Profit against SND 5,297
Profit withdrawn against MTDR 57,950,000
Quard availed from IBBL 210,000,000
Payment against Quard 320,000,000
2 Chief Executive Officer Key management Short-term employee benefits (Salary and 1,887,852
personnel allowance)
3 Islami Bank Capital Parent- subsidiary Payment of interim dividend to IBBL 104,997,550
Management Limited Profit against SND 41,320
4 Directors of the Bank Director Fees , TA/DA/hotel fare and other expenses 12,787,017
6.4 Other related party disclosures

1. There was no contracts of significance wherein a director has interests subsisted at any time during the year or at the end
of the year.
2. Investment to related parties is effected as per requirement of section 27 of Bank Company Act, 1991 as amended.
3. Share issued to Directors and Executives without consideration or exercisable at discount is Nil.
4. Other disclosures are not applicable as required by BRPD Circular No. 14 dated 25 June, 2003 and BRPD Circular No. 15
dated 09 November, 2009.

31.12.2014 31.12.2013
Taka Taka
7.0 Cash in hand
Cash in hand (including foreign currency) (Note. 7.1) 7,696,844,549 8,180,338,285
Balance with Bangladesh Bank & its agent bank(s) (including foreign currency) (Note. 38,522,514,877 36,111,176,654
7.2)
Total 46,219,359,426 44,291,514,939
7.1 Cash in hand (including foreign currency)
In local currency 7,647,881,565 8,155,182,740
In foreign currency 48,962,984 25,155,545
Total 7,696,844,549 8,180,338,285
7.2 Balance with Bangladesh Bank & its agent bank(s) (including foreign currency)
Balance with Bangladesh Bank (a)
In foreign currency 664,220,218 1,129,186,220
Sub-total 36,535,675,565 34,030,180,128
Balance with Sonali Bank Ltd. (as agent of Bangladesh Bank) (b)
In foreign currency - -
Sub-total 1,986,839,312 2,080,996,526
Total (a+b) 38,522,514,877 36,111,176,654
7.3 Cash Reserve Requirement (CRR) & Statutory Liquidity Ratio (SLR)
Cash Reserve Requirement (CRR) and Statutory Liquidity Ratio (SLR) have been calculated and maintained in accordance with the
Section 25 & 33 of the Bank Company Act, 1991 as amended and the Instruction of Bangladesh Bank Order 1972, Article 36, clause (1).
7.3.1 Cash Reserve Requirement (CRR)
The Cash Reserve Requirement (CRR) of the Bank was 6.00% of average total demand and time liabilities on bi-weekly basis with a
provision of minimum 5.5% on daily basis from 15.12.2010 as per Bangladesh Bank MPD Circular No.4 dated 01 December 2010 and DOS
Circular No.-01 dated on 19.01.2014. The requirement has been revised at 6.50% of average total demand and time liabilities on bi-weekly
basis with a provision of minimum 6.00% on daily basis from 24.06.2014 as per Bangladesh Bank MPD Circular No.01 dated 23 June 2014.
The cash reserve maintained by the Bank was in excess of the statutory requirement throughout the year.
Position of Cash Reserve Requirement (CRR)
Required CRR (6.50% of average total time and demand liabilities) 35,830,701,560 27,255,981,640
Actual reserve held with Bangladesh Bank in local currency (Note 7.2) * 35,843,455,347 32,872,993,908
Excess/(shortfall) 12,753,787 5,617,012,268
* Lien against TT discounting facilities of Tk. 2,80,00,000/- has not been considered as CRR.
7.3.2 Statutory Liquidity Ratio (SLR)
The requirement of Statutory Liquidity Ratio (SLR) of the Bank was 11.50% including CRR from 15.12.2010 to 31.01.2014 as per
Bangladesh Bank MPD Circular No.05 dated 01 December 2010. The required SLR has been revised at minimum 5.50% on daily basis
excluding CRR wherein the excess CRR amount shall be included while calculating SLR from 01.02.2014 as per DOS Circular No.
01 dated 19 January 2014. The reserve maintained by the Bank was in excess of the statutory requirement throughout the year.
Position of Statutory Liquidity Ratio (SLR) *
Required Reserve (5.50% of average total time and demand liabilities) 30,318,285,930 52,240,631,470
Actual reserve maintained (Note 7.3.2.1) 109,115,937,648 106,816,928,719
Excess/(shortfall) 78,797,651,718 54,576,297,249
* Position of SLR as on 31.12.2013 includes CRR.
7.3.2.1 Components of Statutory Liquidity Ratio (SLR)
Cash in hand including foreign currency (Note- 7.1) 7,696,844,549 8,180,338,285
Excess CRR amount (Note-7.3.1) 12,753,787 -
Balance with Sonali Bank as Agent Bank of BB (Note-7.2.b) 1,986,839,312 34,953,990,434
Balance with Islamic Refinance Fund A/c (Note-9) 2,000,000,000 -
Unencumbered approved securities :
Bangladesh Shipping Corporation (Note -10) 101,500,000 82,600,000
Bangladesh Government Islamic Investment Bond (Note -10) 97,318,000,000 63,600,000,000
Total 109,115,937,648 106,816,928,719

31.12.2014 31.12.2013
Taka Taka
7(a) Consolidated cash in hand
i) Cash in hand (including foreign currency)
Islami Bank Bangladesh Limited 7,696,844,549 8,180,338,285
Islami Bank Securities Limited 19 4,660
Islami Bank Capital Management Limited 394 4,020
Sub total 7,696,844,962 8,180,346,965
ii) Balance with Bangladesh Bank & its agent bank(s) (including foreign currency)
Islami Bank Securities Limited - -
Islami Bank Capital Management Limited - -
Sub total (ii) 38,522,514,877 36,111,176,654
Total (i+ii) 46,219,359,839 44,291,523,619
8.0 Balance with other banks & financial institutions
i) In Bangladesh
In current account 619,469,727 1,484,506,514
OBU’s balance with treasury division, IBBL (Note-2.0 _OBU) 69,601,591 -
In Mudaraba savings & MTDR account with other islamic banks / financial 17,170,557,971 6,093,434,316
institutions
Sub total 17,859,629,289 7,577,940,830
Less: OBU’s balance with treasury division, IBBL 69,601,591 -
Sub total (i) 17,790,027,698 7,577,940,830
ii) Outside Bangladesh (Note 8.1)
In current account 2,409,322,547 4,749,379,514
In Mudaraba savings & MTDR account with other islamic banks / financial - -
institutions
Sub total (ii) 2,409,322,547 4,749,379,514
Grand total (i+ii) 20,199,350,245 12,327,320,344
8.1 Currency-wise amount and exchange rate of Balance with other banks & financial
institutions outside Bangladesh
Foreign currency Amount in F.C Exchange rate 31.12.2014 31.12.2013
US Dollar 14,847,644.74 77.9494 1,157,364,999 3,667,751,841
Great Britain Pound 2,165,952.18 120.915 1 261,896,324 97,715,292
Saudi Riyal 431,860.35 20.767 1 8,968,487 6,555,633
EURO 6,364,386.90 94.7007 602,711,894 263,884,950
YEN 3,059,162.00 0.6459 1,975,913 97,780,935
Canadian Dollar 188,754.49 66.9323 12,633,772 2,916,579
Swiss Franc 204,228.27 78.7288 16,078,647 3,527,540
Singapore Dollar 5,277,143.41 58.8831 310,734,563 314,374,989
Australian Dollar 7,308.53 63.3807 463,220 127,780,133
ACU Dollar 351,912.53 77.9494 27,431,371 164,181,379
AED 427,079.67 21.2217 9,063,357 2,910,244
Total 2,409,322,547 4,749,379,514
8.2 Maturity - wise classification Balance with other banks & financial institutions
Repayable on 4,194,350,245 6,307,320,344
demand
With a residual maturity of
Up to 1 Month 6,800,000,000 -
Over 1 month but not more than 3 months 9,025,000,000 6,020,000,000
Over 3 months but not more than 1 year 180,000,000 -
Over 1 year but not more than 5 years - -
More than 5 years - -
Total 20,199,350,245 12,327,320,344

31.12.2014 31.12.2013
Taka Taka
8(a) Consolidated Balance with other banks & financial institutions
i) In Bangladesh
Islami Bank Securities Limited 3,982,477,266 1,082,818,348
Islami Bank Capital Management Limited 413,070,405 388,364,770
Inter-company balances (979,679,718) (1,098,386,683)
Sub-total (i) 21,205,895,651 7,950,737,265
ii) Outside
Bangladesh
Sub-total (ii) 2,409,322,547 4,749,379,514
Total (i+ii) 23,615,218,198 12,700,116,779
9.0 Placement with banks & other financial institutions
Placement to OBU by Treasury Division, IBBL (Note-6.0 _OBU) 7,606,631,085 16,213,482,904
Placement to AD Branches for MDB in FC by OBU (Note-3.0 _OBU) 2,859,555,231 3,609,750,453
Placement to Islamic Refinance Fund Account (*) 2,000,000,000 -
12,466,186,316 19,823,233,357
Less: Placement to OBU by Treasury Division, IBBL 7,606,631,085 16,213,482,904
Less: Placement to AD Branches for MDB in FC by OBU 2,859,555,231 3,609,750,453
Total 2,000,000,000 -
(*) The fund is placed to Bangladesh Bank for Re-finance Scheme as per Bangladesh Bank BRPD Circular No. 13 dated 18
September 2014.
10.0 Investments in shares & securities
Book value as
Book value as at 31
Particulars No. of share at 31 Dec. 2014 Remarks
Dec. 2013 (Taka)
(Taka)
10.1 Government
Bangladesh Shipping Corporation 200,000 101,500,000 82,600,000 Quoted
Karmasangsthan Bank 100,000 10,000,000 10,000,000 Un-Quoted
Central Depository Bangladesh Ltd. 2,284,721 6,277,770 6,277,770 Un-Quoted
Bangladesh Government Islamic
Investment Bond (Islamic Bond) 34 97,318,000,000 63,600,000,000 Un-Quoted
Total government (10.1) 2,584,755 97,435,777,770 63,698,877,770
10.2 Other than Government
i) Subsidiary companies
Islami Bank Securities Limited 2,699,946 2,699,946,000 2,699,946,000 Un-Quoted
Islami Bank Capital Management Limited 299,993 299,993,000 299,993,000 Un-Quoted
Sub total (i) 2,999,939 2,999,939,000 2,999,939,000
ii) Others
Bangladesh Aroma Tea Ltd. 1,570 157,000 157,000 De-listed
Investment in Financial Institutions &
Investors Portfolio Management Co. Ltd. 500,000 5,000,000 5,000,000 Un-Quoted
Mudaraba Subordinated Debt of First
Security Islami Bank Ltd. 800 400,000,000 500,000,000 Un-Quoted
Al- Arafah Islami Bank Ltd. 25,500 385,139 - Quoted
Exim Bank Ltd. 21,635 241,263 - Quoted
Ibn Sina Pharmaceutical Ltd 3,500 365,806 918,984 Quoted

Book value as
Book value as at 31
Particulars No. of share at 31 Dec. 2014 Remarks
Dec. 2013 (Taka)
(Taka)
Shahjalal Islami Bank Ltd. 17,028 193,512 - Quoted
United Airways (BD) Ltd. 61,600 766,413 62,359 Quoted
Fareast Islami Life Insurance Co. Ltd 20,000 2,033,763 690,156 Quoted
Power Grid Company of Bangladesh Ltd. 4,000 161,302 422,512 Quoted
Takaful Islami Insurance Ltd. 24,000 716,641 417,491 Quoted
Apex Tannery Ltd. 250 35,407 - Quoted
Prime Textile Ltd. 10,000 189,272 - Quoted
Summit Power Ltd 2,000 76,190 - Quoted
Confidence Cement 15,000 1,973,817 - Quoted
Premier Cement Mills Limited 25,000 2,440,893 - Quoted
Apex Foods Ltd. 1,000 99,518 - Quoted
Meghna Petroleum Ltd. 13,450 3,423,868 - Quoted
Tallu Spinning Ltd. 55,000 1,906,378 - Quoted
Meghna Cement Ltd. 500 62,155 - Quoted
Social Islami Bank Limited. 20,000 275,859 - Quoted
AMCL(Pran) 550 108,733 - Quoted
Rangpur Foundry 2,000 199,197 - Quoted
Khulna power Company Ltd. - - 701,946 Quoted
ICB Islamic Mutual Fund - - 391,928 Quoted
BEXIMCO - - 340,350 Quoted
Square Textile - - 1,098,139 Quoted
Titas Gas Company Ltd - - 2,381,332 Quoted
Sub total (ii ) 824,383 420,812,126 512,582,198
Sub total Other than Government (i+ii) 3,824,322 3,420,751,126 3,512,521,198
Total (10.1+10.2) 6,409,077 100,856,528,896 67,211,398,968
10.3 Revaluation of shares & securities

All Shares and Securities are shown at cost price other than the Shares of Bangladesh Shipping Corporation which have been
recognized at closing market price as on 30.12.2014 of Dhaka Stock Exchange Ltd. (DSE) as per BRPD Circular No.14 dated 25.06.2003
and DOS Circular No. - 05 dated 26 May 2008. 100% provision was made against probable losses in shares of Bangladesh Aroma Tea
Ltd. and adequate provision have been kept for diminution in value of investment in shares for all quoted shares. Changes in revaluation
of shares of BSC has been shown as revaluation reserve of securities. Provision for diminution in value of investment in shares is not
netted off with investment in shares and securities rather shown under other liabilities.
31.12.2014 Taka 31.12.2013 Taka
10.4 Maturity grouping of investments in shares & securities

Repayable on demand - -
Up to 1 Month 19,355,655,126 7,870,025,198
Over 3 months but not more than 1 year 42,618,000,000 32,230,000,000
Over 1 year but not more than 5 years 300,000,000 20,980,000,000
More than 5 years 3,122,873,770 3,021,373,770
Total 100,856,528,896 67,211,398,968

31.12.2014 31.12.2013
Taka Taka
10(a) Consolidated investments in shares & securities
i) Government
Sub total (i) 97,435,777,770 63,698,877,770
ii) Others
Islami Bank Securities Limited 1,820,810,657 1,887,493,659
Inter-company balances (2,999,939,000) (2,999,939,000)
Sub total (ii) 2,241,622,783 2,400,075,857
Total (i+ii) 99,677,400,553 66,098,953,627
11.0 Investments
General investments etc. (Note-11.1) 436,094,101,205 375,200,298,497
Bills purchased & discounted (Note-11.2) 27,381,366,261 27,994,506,480
Total 463,475,467,466 403,194,804,977
11.1 General investments etc.
i) In Bangladesh
Bai - Murabaha 253,916,688,852 223,243,721,234
Bai - Muajjal 29,797,755,704 24,052,604,799
Hire Purchase under Shirkatul Melk 103,940,758,328 95,481,083,230
Bai-Murabaha Import Bills 5,861,479,708 3,864,715,763
Baim- FC Bills 9,498,987,204 7,627,708,774
Musharaka 484,381,392 427,678,772
Mudaraba investment 3,000,010,000 -
Bai - Salam 4,807,597,612 4,200,400,363
Murabaha Foreign Currency Investment 6,952,880,221 2,632,516,647
Quard 15,478,085,584 13,669,868,915
Investment in Khidmah Card (KC) 16,994,600 -
Sub total (i) 433,755,619,205 375,200,298,497
ii) Out side Bangladesh

Bai - Murabaha - -
Bai - Muajjal - -
Hire Purchase under Shirkatul Melk - -
Musharaka - -
Overseas Investment 2,338,482,000 -
Bai - Salam - -
Quard - -
Others - -
Sub total (ii) 2,338,482,000 -
Grand total (i+ii) 436,094,101,205 375,200,298,497

31.12.2014 31.12.2013
Taka Taka
11.1.1 Maturity-wise classification
Up to 1 Month 63,378,766,515 54,528,901,100
Over 1 year but not more than 5 years 96,501,760,873 76,143,857,496
More than 5 years 88,819,562,574 74,696,552,197
Total 436,094,101,205 375,200,298,497
11.1(a) Consolidated general investments

Inter-company balances (3,090,000,000) (200,000,000)
Total 433,004,101,205 375,000,298,497
11.2 Bills purchased & discounted
i) In Bangladesh
Musharaka Doc. Bill (MDB) 9,640,143,708 9,912,995,710
ii) Outside Bangladesh
Mudarba Doc Bill (UPAS)-OBU 12,317,356,285 12,603,732,451
Bai- As- Sarf (FDB) 2,564,171,038 1,980,004,979
MDB in FC 2,859,695,230 3,497,773,340
Sub-total (ii) 17,741,222,553 18,081,510,770
Total (i+ii) 27,381,366,261 27,994,506,480
11.2.1 Maturity-wise classification of bills purchased & discounted
Payable within 1 month 7,108,296,384 7,266,972,145

Over 1 month but less than 3 months 9,544,931,260 9,757,999,083
Over 3 months but less than 6 months 6,197,718,873 6,336,068,163
6 months or more 4,530,419,744 4,633,467,089
Total 27,381,366,261 27,994,506,480
11.2(a) Consolidated bills purchased & discounted

Total 27,381,366,261 27,994,506,480
11.3 Geographical location wise classification of investments

Within Bangladesh
In rural areas 23,737,344,960 57,950,730,825
In urban areas 437,399,640,506 345,244,074,152
Sub total 461,136,985,466 403,194,804,977
Outside Bangladesh 2,338,482,000 -
Total 463,475,467,466 403,194,804,977

31.12.2014 31.12.2013
Taka Taka
11.4 Division wise classification of investments (*)
Name of the division

Dhaka division 272,135,187,835 235,306,564,951
Chittagong division 92,698,693,385 82,622,005,208
Khulna division 29,491,568,454 27,662,709,769
Rajshahi division 40,518,230,905 33,602,056,279
Barisal division 6,194,634,336 4,963,015,576
Sylhet division 9,364,320,744 8,298,812,931
Rangpur division 13,072,831,807 10,739,640,263
Total 463,475,467,466 403,194,804,977
(*) Division wise classification was made on the basis of the location of the respective branch not on the basis of where the client’s
business actually located.
11.5 Investment on the basis of significant concentration including bills purchased and discounted
Investment to directors 388,103,000 444,024,039

Investment to chief executive & other senior executives 932,323,000 709,713,000
Sector wise other investments:
Trade & commerce 129,544,045,291 125,788,547,816
Real estate 37,680,385,849 27,126,960,967
Transport 6,435,450,233 6,679,236,366
Agriculture (including fertilizer & agriculture implements) 11,131,087,642 20,384,772,976
Industrial investment (Note-11.5.1) 247,350,986,911 193,549,881,241
Others 30,013,085,540 28,511,668,572
Total 463,475,467,466 403,194,804,977
11.5.1 Classification of industrial investments
Textile- spinning, weaving & dyeing 87,159,601,548 65,376,404,677

Steel, re-rolling & engineering 17,068,455,427 29,987,979,981
Agro-based industry 49,839,002,427 19,794,827,022
Garments & garments accessories 20,675,772,163 12,795,660,097
Food & beverage 3,760,121,383 8,813,035,537
Cements industry 3,598,514,014 2,109,608,059
Pharmaceuticals 2,885,125,681 2,405,347,507
Poultry, poultry feed & hatchery 822,844,373 946,366,232
Sanitary wares 49,095,993 295,739,448
Chemicals, toiletries & petroleum 7,812,668,913 8,497,580,126
Printing & packaging 1,086,738,101 3,470,009,518
Power (electricity) 5,056,579,437 4,514,955,566
Ceramic & bricks 2,566,593,448 2,898,246,586
Health care ( hospital & others) 1,280,794,799 2,149,039,985
Plastic industries 573,062,291 1,951,880,354
Petrol pump & CNG filling station 468,972,758 1,104,093,937
Information technology 394,475,062 492,899,079
Hotel & restaurant 62,263,592 788,638,527
Other industries 42,190,305,501 25,157,569,003
Total 247,350,986,911 193,549,881,241

31.12.2014 31.12.2013
Taka Taka
11.6 Details of investment to customers group (10.00% of regulatory equity and above)
Number of clients with amount of sanctioned limit of investments exceeding 10.00% of total regulatory equity of the Bank & classified
amount thereon are given below:
Number of clients 15 15
Amount of investments 122,271,000,000 119,260,000,000
Classified amount thereon Nil Nil
Measures taken for recovery Not Applicable Not Applicable
Total regulatory capital of the Bank was Tk. 48,569.86 million as at 31 December 2014 (Tk. 45,487.38 million as on 31 December 2013).
(Taka in million)
Outstanding as on 31.12.2014
Sl. No. Name of clients Sanctioned limit 31.12.2013
Funded Non-funded Total
1 Noman Group 18,275.00 13,507.00 4,367.00 17,874.00 19,333.00
2 S. Alam Group 16,825.00 14,378.00 2,168.00 16,546.00 14,372.00
3 Aman Group 8,672.00 6,594.00 3,359.00 9,953.00 5,529.00
4 Farzana Group 12,000.00 5,755.00 4,016.00 9,771.00 9,083.00
5 Badsha Group 7,537.00 4,020.00 4,060.00 8,080.00 5,786.00
6 MSA Group 8,456.00 5,715.00 1,987.00 7,702.00 7,088.00
7 Delta Group 5,948.00 4,968.00 1,919.00 6,887.00 5,593.00
8 Nur-e-Madina Group 5,348.00 5,223.00 1,458.00 6,681.00 7,515.00
9 Patromax Refinery 4,550.00 3,135.00 3,156.00 6,291.00 6,120.00
10 Ananda Group 7,099.00 6,168.00 13.00 6,181.00 5,711.00
11 Mosharraf Group 6,767.00 4,947.00 1,094.00 6,041.00 7,195.00
12 Nassa Group 7,850.00 3,570.00 2,127.00 5,697.00 6,331.00
13 BRB Group 8,121.00 3,243.00 2,376.00 5,619.00 5,806.00
14 Abul Khair Group 7,181.00 2,534.00 2,237.00 4,771.00 8,134.00
15 Abdul Monem Group 6,291.00 4,177.00 - 4,177.00 5,664.00
Total 87,934.00 34,337.00 122,271.00 119,260.00
31.12.2014 31.12.2013
11.7 Classification status - wise investments Taka Taka
Unclassified :
i) Unclassified including staff investment 424,231,589,013 371,539,189,061
ii) Special mention account (SMA) 16,436,640,275 16,713,715,269
Total unclassified (i+ii) 440,668,229,288 388,252,904,330
Classified :
iii) Substandard 2,235,222,352 1,707,265,721
iv) Doubtful 1,513,000,505 653,099,020
v) Bad and Loss 19,059,015,321 12,581,535,906
Total classified (iii+iv+v) 22,807,238,178 14,941,900,647
Grand total ( i to v) 463,475,467,466 403,194,804,977
11.8 Pledged collaterals against investments
Land & building 656,240,012,983 526,482,176,344
MTDR, securities, etc. 34,816,740,707 16,942,474,643
Share certificates 56,140,000 140,992,500
Total 691,112,893,690 543,565,643,487

31.12.2014 31.12.2013
Taka Taka
11.9 Particulars of investments
i) Investments considered good in respect of which the bank is fully secured 442,129,601,677 389,317,407,158
ii) Investments considered good in respect of which the Bank holds debtors’ personal 16,994,600 -
security
iii) Investments considered good and secured by personal security of one or more 21,328,871,189 13,877,397,819
persons in addition to personal security of debtors
iv) Investments considered bad or doubtful not provided for - -
Total 463,475,467,466 403,194,804,977
v) Investments due by directors or employees of the bank or any of them either severally 12,086,232,123 9,087,895,956
or jointly with any other persons
vi) Investments due by directors or employees of the bank are interested as directors, 379,628,709 434,919,394
partners, managing agents or in the case of private companies as members
vii) Total amount of investments, including temporary investments, made any time 3,756,720,608 3,577,165,708
during the year to directors or employees of the bank or any of them either severally
or jointly with any other persons
viii) Total amount of investments, including temporary investments granted during the - -
year to the Companies or firms in which the directors of the bank are interested as
directors, partners, managing agents or, in the case of private companies as members
ix) Investments due from other banks - -
x) Classified investments:
a) Classified investments on which profit has not been charged 19,059,015,321 12,581,535,906
b) Provision for classified investments 13,354,720,000 9,037,800,000
c) Provision kept against investments classified as bad & loss 12,997,864,539 8,794,188,000
d) Amount credited to profit/ rent /compensation suspense account 4,637,284,546 2,483,769,765
xi) Particulars of written off investments
a) Cumulative amount of investment written off since inception to 31st December last year 5,318,286,468 5,148,936,721
b) Amount of investment written off during this year (*) 259,980,017 169,349,747
c) Total amount written Off (a + b) 5,578,266,485 5,318,286,468
d) Amount recovered against written off investment up to this year (**) 1,322,391,025 1,283,040,729
e) Amount waived against written off investment up to this year 939,801,797 913,271,547
f) Amount of investment written off against which suit has been filed to recover the same 3,316,073,663 3,121,974,192
(*) Out of the total amount of investment written-off during the year of 2014, Tk.72,44,117/- was written-off from profit/rent suspense
and Tk.11,16,09,013/- was from compensation suspense .
(**) During the year of 2014, Tk.39,350,296/- (2013 Tk. 43,918,185/-) was recovered from the clients in cash.
12.0 Fixed assets (Annexure-A)
12.1 Tangible assets
Land 7,593,266,550 7,592,598,419
Building 6,317,393,834 6,234,391,377
Construction/ capital work-in-process 197,106,998 103,812,967
Furniture and fixtures 811,688,722 719,377,288
Mechanical appliances 3,098,463,563 2,721,050,008
Motor vehicles 599,438,630 525,169,792
ATM 632,874,804 482,830,169
Books 5,875,956 4,773,584
Total cost of tangible assets including revaluation 19,256,109,057 18,384,003,604
Less: Accumulated depreciation 3,607,189,972 2,934,615,074
Net book value of tangible assets at the end of the year 15,648,919,085 15,449,388,530

31.12.2014 31.12.2013
Taka Taka
12.2 Intangible assets
Computer software 386,329,162 309,480,952
Total cost of intangible assets 386,329,162 309,480,952
Less: Accumulated amortization 108,886,331 26,060,893
Net book value of intangible assets at the end of the year 277,442,831 283,420,059
Total net book value at the end of the year (12.1+12.2) 15,926,361,916 15,732,808,589
12.3 Maturity-wise classification
Up to 1 Month
Over 1 month but not more than 3 months - -
Over 3 months but not more than 1 year 744,614,312 736,244,555
More than 5 years 12,548,990,333 13,876,539,399
Total 15,926,361,916 15,732,808,589
12.4 Revaluation of land & building
As per Bangladesh Bank BCD Circular Letter No. 12 & 18 dated April 20, 1993; June 15, 1993; BRPD Circular No.10 dated November 25, 2002;
circular No. 09 dated 31 December 2008 and circular No. 24 dated 03 August 2010, the Bank revalued its land and building by the professional
valuers for the year 2000, 2002, 2003, 2004, 2005, 2006, 2009 & 2012 respectively which was reviewed by the statutory auditors.
12(a) Consolidated fixed assets (Annexure-B)

12(a).1 Tangible assets
Islami Bank Securities Limited 3,757,475 5,326,024
Sub-total 15,652,676,560 15,454,714,554
12(a).2 Intangible assets
Islami Bank Bangladesh Limited 277,442,831 283,420,059
Islami Bank Securities Limited 360,198 724,070
Sub-total 277,803,029 284,144,129
Total (12.a.1+12.a.2) 15,930,479,589 15,738,858,683
13.0 Other assets
i) Income generating other assets - -
ii)Non-income generating other assets
Stock of stationery in hand 119,939,381 95,667,966
Stamps in hand 12,550,769 9,147,405
Advance rent paid 525,644,682 544,345,583
Security deposits paid account 18,351,705 14,091,298
Suspense 501,345,335 1,739,115,350
Advance against expenses 15,430,338 12,988,634
Pre-paid expense-OBU 26,680,339 -
Accrued income 2,009,498,611 1,822,961,997
IB General account (Note - 13.3) 119,780,146 -
F.C. clearing adjustment 358,648,429 180,027,615
mCash System A/c 6,800,258 23,136,480
Receivables from Seylon Bank PLC * 30,300,809 30,300,809
Sub-total (ii) 3,744,970,802 4,471,783,137
Total (i+ii) 3,744,970,802 4,471,783,137
*100% provision was made against probable losses for Receivables from Seylon Bank PLC

31.12.2014 31.12.2013
Taka Taka
13.1 Maturity-wise classification
Up to 1 Month 309,653,248 311,682,569
Over 3 months but not more than 1 year 919,707,427 925,734,755
Over 1 year but not more than 5 years 560,204,150 563,875,463
More than 5 years 277,566,351 279,385,390
Total 3,744,970,802 4,471,783,137
13.2 Classification status of other assets
Unclassified 3,657,138,574 4,359,009,787

Doubtful - 6,185,928
Bad/ Loss 87,832,228 106,587,422
Total 3,744,970,802 4,471,783,137
13.3 IB General account
13.3.1 Un-reconciled entries of Inter branch transactions in Bangladesh
Age Number Amount in Taka Amount in Taka

Upto 3 months (*) 13 119,780,146 -
Over 3 months but not more than 6 months - - -
Total 13 119,780,146 -
(*) All the outstanding entries in the above mentioned IB General Account have been fully adjusted within 8 March 2015.
13.3.2 Un-reconciled entries of inter branch transactions outside
Bangladesh
Age Number Amount in Taka Amount in Taka
Upto 3 months - - -
Total - - -
13(a) Consolidated other assets
Inter-company balances (116,215,662) (15,075,838)
Total 3,751,558,076 4,545,107,670
14.0 Deposits & other accounts
Mudaraba savings deposits (Note-14.1) 183,128,708,639 156,072,977,380
Other mudaraba deposits (Note-14.2) 149,346,325,824 129,401,794,243
Al- wadeeah current and other deposit accounts (Note-14.3) 54,396,285,416 52,124,147,978
Bills payable (Note-14.4) 3,649,894,101 4,129,657,957
Total 560,696,300,836 473,140,955,031
14.1 Mudaraba savings deposits
Mudaraba Savings Deposits 177,206,503,531 151,518,685,457
Mudaraba Savings Deposits (RDS) 4,455,720,616 3,670,537,107
Mudaraba Savings Deposit (RDS-RIP) 448,754 4,764,099
Mudaraba School Student Savings 651,387,313 329,734,176
Mudaraba Farmers Savings A/C 814,648,425 549,256,541
Total 183,128,708,639 156,072,977,380

31.12.2014 31.12.2013
Taka Taka
14.2 Other mudaraba deposits
Mudaraba Special Notice Deposits 6,071,880,203 5,916,386,559
Mudaraba Hajj Deposits 1,850,748,069 1,528,653,665
Mudaraba Savings Bond 16,820,776,032 15,826,157,593
Mudaraba NRB Savings Bond 858,190,578 725,923,015
Mudaraba Special Savings (Pension) Deposits 93,252,815,277 82,700,530,973
Mudaraba Monthly Profit Deposit Scheme 21,789,339,383 18,988,275,561
Mudaraba Muhor Savings 429,546,767 381,733,723
Mudaraba Waqf Cash Deposit 533,005,487 436,010,591
Mudaraba Upahar Deposit Scheme 12,686,900 11,404,500
Mudaraba FC Deposit 7,725,100,106 2,886,251,563
Mudaraba FC Deposit ERQ 2,237,022 466,500
Total 149,346,325,824 129,401,794,243
14.3 Al Wadeeah current & other deposits accounts
Al Wadeeah Current Deposits 26,276,899,883 24,472,256,739
Convertible Taka Account 151,708 151,708
Non Resident Investors Taka Account 310,807,655 48,860,474
Non Resident FC of Exchange House / Banks 122,651,435 849,140,151
Non Resident FC of Exchange House / Banks-OBU (Note-2.0 _OBU) 69,601,591 -
Non Resident Taka Account 2,135,452,545 1,836,556,742
Foreign Currency Deposit 227,322,404 200,312,993
Foreign Currency Deposit ERQ 753,219,113 479,242,042
Other FC Deposit 37,832,780 39,649,561
Foreign Currency: Security Deposit 108,181,538 90,197,035
Foreign Currency Held against Back to Back L/C 3,797,545,715 3,201,204,154
Foreign Currency held against Cash L/C 474,533,179 527,160,494
Foreign Demand Draft /TT Payable 631,415,387 1,172,175,682
Foreign Currency Deposit against Foreign Bank Guarantee 31,131,042 31,051,406
Profit Payable 10,163,838,731 11,293,770,751
Remittance Card Account 1,473,936 2,338,109
Sundry Deposits (Note-14.3.1) 9,282,404,631 7,855,092,506
FC Deposit of EPZ Enterprises 8,042,291 1,752,237
Mobile Wallet A/C 33,381,443 23,235,194
Sub total 54,465,887,007 52,124,147,978
Less: Non Resident FC of Exchange House / Banks-OBU 69,601,591 -
Total 54,396,285,416 52,124,147,978

31.12.2014 31.12.2013
Taka Taka
14.3.1 Break-up of sundry deposits
Sundry creditors 896,843,941 185,866,407
Supervision charge 48,673,117 44,608,406
Security deposit L/G 1,814,160 1,814,160
Security money payable 115,811,065 148,276,146
Security money locker 14,662,095 11,074,697
Marginal deposit 670,929,112 651,756,174
Bank guarantee 7,970,052 2,915,986
Excise duty - 18,026,590
Closed account profit 297,584,883 239,950,693
Sundry deposit others 118,757,267 314,166,544
Govt. tax & VAT 23,066,578 53,058,084
Security Deposit - Investment 17,343,383 8,257,544
Security Deposit - L/C (Wes) 7,582,244 5,371,000
Security Deposit - Foreign L/C General 6,219,958,060 5,274,879,206
Security Deposit - Back to Back L/C (Inland) - 2,050,000
Security Deposit - Bank Guarantee 691,224,104 543,205,590
Security Deposits - Foreign Bill Negotiation( FBN)/ MDB 210,422 210,422
Security Deposit - IBP 145,486 145,486
Security Deposit - Inland L/C 48,831,511 56,388,464
RDS (RIP) 86,519,838 277,965,238
Other earnings (Note-14.3.1.1) 14,477,313 15,105,669
Total 9,282,404,631 7,855,092,506
14.3.1.1 Break-up of other earnings

Opening balance 15,105,669 14,662,181
Received from B. Bank FC clearing A/c 1,994,335 3,960,862
Received from foreign correspondents/banks 252,006 149,552
Total receipt during the year 2,246,341 4,110,414
Total available balance 17,352,010 18,772,595
Less:
Income tax provision @ 42.50% 954,697 1,746,926
Transferred/ paid for charitable activities 1,920,000 1,920,000
Closing balance 14,477,313 15,105,669

31.12.2014 31.12.2013
Taka Taka
14.4 Bills payable
P.O. payable 2,916,986,417 2,946,159,689
T.T. payable 18,540,133 27,292,942
D.D. payable 318,699,302 594,694,593
FC bills payable 5,181,274 5,181,274
BEFTN payable 66,657,641 84,460,023
Spot cash payable 323,829,334 471,869,436
Total 3,649,894,101 4,129,657,957
14.5 Maturity wise classification of deposits (other than inter-Bank deposit)
Re-payable on demand 12,674,499,013 10,675,633,571
Re- payable within 1 month 79,719,294,943 67,146,952,355
Over 3 months but within 6 months 85,303,560,053 71,850,536,143
Over 5 years but within 10 years 108,432,499,867 79,323,858,649
Unclaimed Deposits for 10 years or more 6,152,719 16,684,927
Sub-total 560,374,035,914 472,625,142,811
14.6 Maturity grouping of Inter- bank deposits are as under
Re-payable on demand - -
Re- payable within 1 month 322,264,922 515,812,220
Over 1 month but within 6 months - -
Over 6 months but not more than 1 year - -
Over 1 year but not more than 5 years - -
Over 5 years but within 10 years - -
Sub-total 322,264,922 515,812,220
Total (14.5+14.6) 560,696,300,836 473,140,955,031
14.7 Other banks’ deposits with IBBL
Al Wadeeah Current Deposits 144,716,985 311,608,209
Mudaraba Special Notice Deposits 129,129,207 143,019,736
Mudaraba Savings Account 48,418,730 61,184,275
Total 322,264,922 515,812,220
14.8 Sector wise break up of deposits and other accounts
Government 204,387,000 205,578,000
Other banks’ deposit 322,264,922 515,812,220
Other public 576,694,000 753,318,000
Foreign currency 13,919,212,012 9,478,603,808
Private 545,673,742,902 462,187,642,993
Total 560,696,300,836 473,140,955,031

31.12.2014 31.12.2013
Taka Taka
14(a) Consolidated deposits & other accounts
Inter-company balances (983,874,763) (1,020,407,470)
Total 559,713,580,029 472,121,971,348
15.0 Mudaraba Perpetual Bond (Note - 3.19) 3,000,000,000 3,000,000,000

15.1 Security pledged against Mudaraba Perpetual Bond (MPB) 4,489,100,000 4,489,100,000

Provision for classified & unclassified investments and off- balance sheet items 18,108,400,000 13,546,600,000
(Note- 16.1)
Provision for diminution in value of investments in shares (Note - 16.2) 3,498,661 423,778
Other provisions (Note - 16.3) 194,527,027 109,681,000
Compensation account (Note-16.5) 171,936,390 -
Profit/ rent /compensation suspense (Note - 16.6) 4,637,284,546 2,483,769,765
Current tax (Note-16.7) 8,104,445,048 7,050,182,433
Zakat payable 1,490,415,591 1,115,146,578
Dividend payable - 9,790,440
Foreign correspondents charges 2,433,269 484,485
Incentive bonus payable 1,185,893,152 1,080,000,000
Payable against expenditure 85,384,738 391,192,037
Clearing adjustment 36,341,416 64,782,783
Transfer delivery adjustment 157,569 65,773
Substitute cash assistance - 650
BEFTN adjustment 808,378 14,905,662
Payable to Benevolent Fund & SAF 30,000,000 30,000,000
Deffered/Unearned Airtime Commission 183,800 -
F.C. Payable A/c IBBL Travel Card 266,176 -
F.C. Payable A/c IBBL Hajj Card 51,333 -
IB General account (Note - 16.8) - 1,236,835,184
Total 34,052,027,094 27,133,860,568
16.1. Provision for investments including bad & doubtful investments
General provision
Unclassified investments excluding OBU 3,307,926,000 3,041,538,171
Unclassified investments -OBU 123,193,000 162,134,829
Special mention account 194,361,000 167,927,000
Sub-total (Note-16.1.1) 3,625,480,000 3,371,600,000
Off-balance sheet items (Note-16.1.2) 1,128,200,000 1,137,200,000
Sub-total (General provision) 4,753,680,000 4,508,800,000
Specific provision (Note-16.1.3)
Substandard 101,045,936 130,347,000
Doubtful 255,809,525 113,265,000
Bad and loss 12,997,864,539 8,794,188,000
Sub-total (Specific provision) 13,354,720,000 9,037,800,000
Total provision held at the end of the year 18,108,400,000 13,546,600,000

31.12.2014 31.12.2013
Taka Taka
16.1.1 General provision on unclassified investment including OBU
Provision held at the beginning of the year 3,371,600,000 3,935,900,000
Provision made/ (no longer required) during the year 253,880,000 (564,300,000)
16.1.2 General provision on off-balance sheet items
Provision made/ (no longer required) during the year (9,000,000) 36,750,000
Total provision held at the end of the year (*) 1,128,200,000 1,137,200,000
Sub-total (16.1.1+16.1.2) 4,753,680,000 4,508,800,000
16.1.3 Provision for classified investments
Fully provided investment written off/waived/transferred (Note-16.1.3.1) (148,335,025) (603,651,687)
Recoveries of amounts previously written off 39,350,296 43,918,185
Provision made during the year 4,425,904,729 3,543,183,502
Provision no longer required - -
Net charge to profit & loss account for classified investment 4,425,904,729 3,543,183,502
Total provision for investments (16.1.1+16.1.3) 16,980,200,000 12,409,400,000
Total provision (16.1.1+16.1.2+16.1.3) 18,108,400,000 13,546,600,000
16.1.3.1 Breakup of fully provided investment written off/waived/transferred
Transferred to compensation and doubtful income realised account - (372,776,167)
Due to waiver during the year - (130,491,017)
Due to written-off during the year (148,335,025) (100,384,503)
Total (148,335,025) (603,651,687)
16.1.4 Provision made for investments & off- balance sheet items for the year 2014 2013
Provision for classified investments 4,425,904,729 3,543,183,502
General provision for unclassified investment including OBU 253,880,000 (564,300,000)
General provision for off-balance sheet items (9,000,000) 36,750,000
Total 4,670,784,729 3,015,633,502
16.1.5 Total Provision Requirement and maintained for investments including off balance sheet items at the end of year 2014
Required Maintained
Particulars of Investment
Provision for 2014 Provision for 2014
General provision on unclassified investment including OBU 3,625,411,712 3,625,480,000
Provision for classified investments 9,390,919,650 9,391,020,000
Provision for investments considering qualitative judgement 3,963,700,000 3,963,700,000
Total provision for investment 16,980,031,362 16,980,200,000
General provision on off-balance sheet items 1,128,192,273 1,128,200,000
Total provision for investment including off balance sheet items at the end of 18,108,223,635 18,108,400,000
the year
Provision surplus/(deficit) for the year 2014 176,365
31.12.2014 31.12.2013
16.2 Provision for diminution in value of investments in shares Taka Taka
Opening balance 423,778 -
Add: Provision made during the year 3,074,883 423,778
Closing balance (Note-16.2.1) 3,498,661 423,778

31.12.2014 31.12.2013
Taka Taka
16.2.1 Provision for diminution in value of investments in shares
i) Dealing securities
Quoted 3,341,661 266,778
Un-quoted - -
Sub-total (i) 3,341,661 266,778
ii) Investment securities
Quoted - -
Un-quoted 157,000 157,000
Sub-total (ii) 157,000 157,000
Total (i+ii) 3,498,661 423,778
16.2(a) Consolidated provision for diminution in value of investments in shares made

during the year
Islami Bank Bangladesh Limited 3,074,883 423,778
Total 36,184,361 45,627,899
16.3 Other provisions
Provision for other assets (Note-16.3.1) 123,369,900 109,681,000
Provision for doubtful income account (Note-16.3.2) 71,157,127 -
Total 194,527,027 109,681,000
16.3.1 Provision for other assets
Opening balance 109,681,000 96,550,000
Less: Transfer for settlement - 70,000
Add: Provision made during the year 13,688,900 13,201,000
Closing balance 123,369,900 109,681,000
16.3.2 Provision for doubtful income account
Opening balance - -
Add: Provision made during the year 103,360,602 -
Less: Expended for charitable purposes 32,203,475 -
Closing balance 71,157,127 -
16.4 Other provisions for the year
Provision for other assets 13,688,900 13,201,000
Provision for doubtful income account 103,360,602 -
Total 117,049,502 13,201,000
Adequate provision for the investments, off-balance sheet items and other assets have been made as per the relevant circulars
issued by Bangladesh Bank as well as decision taken in tripartite meeting amongst Inspection Team of Bangladesh Bank, External
Auditors and the Management of Islami Bank Bangladesh Limited and subsequent communications to the Bank. However, out
of cases under writ petitions provisions have been made against cases as per the instruction of Bangladesh Bank and accrued
profit on investments under writ petitions cases have been credited to profit/rent suspense accounts instead of investment
income on prudence basis.

31.12.2014 31.12.2013
Taka Taka
16.5 Compensation account
Opening balance - -
Addition during the year 769,375,628 -
Total 769,375,628 -
Less: Income tax provision @ 42.50% 326,984,642 -
Less: expended for charitable activities 270,454,596 -
Closing balance 171,936,390 -
16.6 Profit/rent/compensation suspense
Profit/rent suspense (Note-16.6.1) 1,717,660,073 563,405,586

Compensation suspense (Note-16.6.2) 2,919,624,473 1,920,364,179
Total 4,637,284,546 2,483,769,765
16.6.1 Profit/ rent suspense
Balance at the beginning of the year 563,405,586 499,628,822

Amount transferred to suspense account during the year 2,884,720,516 1,092,592,585
Amount transferred to investment income during the year (1,723,221,912) (886,661,150)
Amount written-off during the year (7,244,117) (142,154,671)
Amount waived during the year - -
Balance at the end of the year 1,717,660,073 563,405,586
16.6.2 Compensation suspense

Balance at the beginning of the year 1,920,364,179 1,115,334,219
Amount transferred to suspense account during the year 1,635,324,839 1,507,028,245
Amount transferred to compensation income during the year (387,287,567) (571,507,268)
Amount written-off during the year (111,609,013) (130,491,017)
Amount waived during the year (137,167,965) -
Balance at the end of the year 2,919,624,473 1,920,364,179
16.7 Current tax liability
Balance of provision on 01 January 10,062,355,707 8,887,170,146

Add: Provision made during the year ( Note 16.7.1) 6,323,390,422 6,145,665,449
Add: Other provision made during the year 327,984,375 134,676,797
Less: Settlement for previous year 5,100,387,470 5,105,156,685
Total (a) 11,613,343,034 10,062,355,707
Advance tax
Balance of advance tax on 01 January 3,012,173,274 2,385,413,375
Add: Payment made during the year 5,597,112,182 5,731,916,584
Less: Settlement for previous year 5,100,387,470 5,105,156,685
Total ( b) 3,508,897,986 3,012,173,274
Net balance as at 31 December (a-b) 8,104,445,048 7,050,182,433

31.12.2014 31.12.2013
Taka Taka
16.7.1 Provision for current tax made during the year
Income tax @ 42.50% on taxable profit (A) 6,300,768,396 6,277,417,613
Add: Income tax @ 20% on dividend income 22,622,026 2,924,633
Add: Excess profit tax -
Less: Provision already kept - 134,676,797
Estimated provision required as at 31 December, (i) 6,323,390,422 6,145,665,449
Provision held
Balance at 1st January 10,062,355,707 8,887,170,146
Less: Tax for previous year 5,100,387,470 5,105,156,685
Actual provision for tax held (ii) 4,961,968,237 3,782,013,461
Estimated provision needs to be made (i-ii) 1,361,422,185 2,363,651,988
Provision actually made during the year 6,323,390,422 6,145,665,449
Computation of taxable profit
Profit before tax 10,531,712,736 11,050,153,090
Less: Dividend income 113,110,128 14,623,166
Profit before tax (excluding dividend income) 10,418,602,608 11,035,529,924
Add : Inadmissible expenditure 5,712,242,877 4,771,131,634
Less : Further allowable expenditure 1,305,508,083 1,060,870,511
Estimated taxable profit for the year (A) 14,825,337,402 14,745,791,047
Provision for tax for the year ended on 31.12.2014 has been made as per Income Tax Ordinance, 1984 applying prevailing rates
applicable on the net profit. Income tax assessments have been completed by the Deputy Commissioner of Taxes up to the
accounting year 2010 and income tax return has been submitted for the year 2013. The Bank filled appeals/ writ petitions against
tax assessment orders of different levels of tax authorities to the appropriate tax authorities and High Court on different disputed
issues. Adequate provisions for those assessment years have been made in the books of accounts.
16.7.2 Reconciliation of effective tax rate
2014 2013
Particulars
% Taka % Taka
Profit before income tax as per profit 10,531,712,736 11,050,153,090
and loss account
Income Tax using the domestic 42.50% 4,475,977,913 42.50% 4,696,315,063
corporate tax rate
Factors affecting the tax charge for
current year:
Non deductible expenses 23.05% 2,427,703,223 18.35% 2,038,187,362
Tax exempt income -5.27% (554,840,935) -5.30% (585,546,764)
Tax savings from reduced tax rates -0.24% (25,449,779) -0.03% (3,290,212)
from dividend
Total income tax expenses 60.04% 6,323,390,422 55.62% 6,145,665,449

31.12.2014 31.12.2013
Taka Taka
16.7(a) Consolidated current tax liability

Total 6,367,368,688 6,195,969,079
16.8 IB General account
Un-reconciled entries of inter branch transactions in

Bangladesh
Maturity Number Amount in Taka Amount in Taka
Upto 3 months (*) - - 1,236,835,184
More than 6 months - - -
Total (i+ii+iii) - - 1,236,835,184
(*) All the outstanding entries in the above mentioned IB General Account have been fully adjusted within 24.02.2014.
16.9 Maturity-wise classification of other liabilities
Up to 1 Month 2,952,471,399 1,960,889,341
More than 5 years 12,566,821,569 12,864,421,577
Total 34,052,027,094 27,133,860,568
16(a) Consolidated other liabilities

Islami Bank Securities Limited 3,214,833,187 400,594,220
Inter-company balances (3,202,020,617) (293,055,051)
Total 34,220,763,730 27,289,134,160
17.0 Deferred tax (assets)/ liabilities
Deferred tax assets and liabilities have been recognised and measured in accordance with the provision of Bangladesh Accounting
Standards (BAS) 12 “Income Taxes” and BRPD circular No. 11 dated 12 December 2011. Calculation of deferred tax has been
made on all temporary differences between the tax base and carrying amounts for financial reporting purpose. Deferred tax
assets and liabilities are attributable to the following:
i) Deferred tax on fixed assets
Carrying amount 4,180,620,405 4,001,520,552

Tax Base 3,231,449,236 3,218,534,573
Temporary timing difference 949,171,169 782,985,979
Deferred tax (asset)/liability @ 42.50% 403,397,747 332,769,041
Opening balance 332,769,041 238,230,992
Deferred tax (income)/expenses 70,628,706 94,538,049

31.12.2014 31.12.2013
Taka Taka
ii) Deferred tax on provision for gratuity
Carrying amount - -
Tax Base - 326,200,000
Temporary timing difference - (326,200,000)
Deferred tax (asset)/liability @ 42.50% - (138,635,000)
Opening balance (138,635,000) -
Deferred tax (income)/expenses 138,635,000 (138,635,000)
Net deferred tax (income)/expenses (i+ii) 209,263,706 (44,096,951)
Net deferred tax (assets)/liabilities (i+ii) 403,397,747 194,134,041
17(a) Consolidated Deferred tax (assets)/liabilities
Islami Bank Securities Limited (315,880) 55,273
Total 403,081,867 194,189,314
17(b) Consolidated deferred tax (income)/expenses
Islami Bank Bangladesh Limited 209,263,706 (44,096,951)
Islami Bank Securities Limited (371,153) (342,586)
Total 208,892,553 (44,439,537)
18.0 Share capital
18.1 Authorized capital
The authorized capital of the Bank is Tk.20,000,000,000 divided into 2,000,000,000 ordinary shares of Tk.10 each.
18.2 Paid up capital
The shareholders of the bank in their 31st Annual General Meeting held on May 31, 2014 approved 10% Stock Dividend (Bonus
Share) for the year 2013, thus Paid-up Capital of the Bank has increased from Tk.14,636.28 million to Tk.16,099.91 million at
the end of the year 2014; as detailed below:
31.12.2014 Taka
146,36,27,880 ordinary shares of Tk.10 each 14,636,278,800
14,63,62,778 Ordinary Shares of Tk.10 each issued as Bonus Share 1,463,627,880
Total 16,099,906,680
18.2.1 The Paid-up Capital of the Bank is Tk.1609,99,06,680 divided into 160,99,90,668 ordinary shares of Tk.10 each fully subscribed by:
No. of Shares as 31.12.2014 31.12.2013

Particulars % of Total
on 31 Dec, 2014 Amount in Taka Amount in Taka
(i) Sponsors/ promoters 939,778,646 58.3717% 9,397,786,460 8,613,115,660
(ii) General public 670,191,705 41.6270% 6,701,917,050 6,022,978,440
(iii) Government of the People’s
20,317 0.0013% 203,170 184,700
Republic of Bangladesh*
Total 1,609,990,668 100.000% 16,099,906,680 14,636,278,800
* The shares have already been sold by the Government of Bangladesh but no transfer has yet been made in share register of the Bank.

18.2.2 Break up of share holding and percentage thereof as on 31.12.2014
No. of Total Holdings/ No.
Holdings Percentage (%)
Shareholders of Shares
Less than 500 Shares 35,874 5,211,980 0.32%
500 to 5,000 Shares 18,510 32,322,349 2.01%
5,001 to 10,000 Shares 2,654 18,847,539 1.17%
10,001 to 20,000 Shares 1,691 24,013,505 1.49%
20,001 to 30,000 Shares 644 15,691,283 0.98%
30,001 to 40,000 Shares 315 10,837,851 0.67%
40,001 to 50,000 Shares 221 9,874,581 0.61%
50,001 to 100,000 Shares 398 27,967,216 1.74%
100,001 to 1,000,000 Shares 452 131,233,400 8.15%
Over 1,000,000 Shares 98 1,333,990,964 82.86%
Total 60,857 1,609,990,668 100.00%
19.0 Capital adequacy as per Basel - II as on 31 December 2014 (Consolidated)

The Calculation of Capital Adequacy of the Bank has been done as per the revised guidelines on Risk Based Capital Adequacy
(RBCA) for Banks (Revised Regulatory Framework in line with Basel-II) issued by Bangladesh Bank vide BRPD Circular No. 09
dated 03.08.2010 and BRPD Circular No. 35 dated 29.12.2010. Detail calculation of Capital Adequacy as per Basel-II as on
December 31, 2014 is given below:
(Amount in million Taka)
31.12.2014 31.12.2014 31.12.2013
Particulars
(Consolidated) (Solo) (Consolidated)
A. Regulatory capital
1. Tier-1 (Core capital) (Note-19.1) 34,997.69 35,025.95 32,201.18
2. Tier-2 (Supplementary capital) (Note-19.2) 13,543.92 13,543.92 13,289.59
3. Tier-3 (Additional supplementary capital) (Note-19.3) - - -
A. Total regulatory capital (1+2+3) 48,541.61 48,569.86 45,490.77
B. Total Risk Weighted Assets (RWA) (Note-19.4) 378,467.30 378,742.72 318,913.69
C. Capital Adequacy Ratio (CAR) (as against required above 12.83% 12.83% 14.26%
10.00% )
D. Core capital to RWA (as against required minimum 5.00%) 9.25% 9.25% 10.10%
E. Supplementary capital to RWA 3.58% 3.58% 4.17%
F. Minimum Capital Requirement (MCR) 37,846.73 37,874.27 31,891.37
G. Surplus capital (A-F) 10,694.88 10,695.59 13,599.40
19.1 Tier-1 (Core capital)

1.1 Fully paid-up capital/capital deposited with BB 16,099.91 16,099.91 14,636.28
1.2 Statutory reserve 16,099.91 16,099.91 14,638.61
1.3 Non-repayable share premium account 1.99 1.99 1.99
1.4 General reserve 377.16 377.16 254.38
1.5 Retained earnings 2,386.67 2,414.99 2,637.86
1.6 Non-controlling interest in subsidiaries 0.06 - 0.06
1.7 Non-cumulative irredeemable preferences shares - - -
1.8 Dividend equalization account 32.00 32.00 32.00
1.9 Sub-total: (1.1 to 1.8) 34,997.69 35,025.95 32,201.18

(Amount in million Taka)
31.12.2014 31.12.2014 31.12.2013
(Consolidated) (Solo) (Consolidated)
Deductions from Tier-1 (Core capital)
1.10 Book value of goodwill - - -
1.11 Shortfall in provisions required against classified - - -
assets
1.12 Shortfall in provisions required against investment - - -
in shares
1.13 Remaining deficit on account of revaluation of - - -
investment in securities after netting off from any
other surplus on the securities.
1.14 Reciprocal crossholdings of bank capital / - - -
subordinated debt
1.15 Any investment exceeding the approved limit - - -
1.16 Investment in subsidiaries which are not - - -
consolidated
1.17 Others (Specify) - - -
1.18 Sub total (1.10 to 1.17) - - -
1.19 Total eligible tier-1 capital (1.9-1.18) 34,997.69 35,025.95 32,201.18
19.2 Tier-2 (Supplementary capital)
2.1 General provision (unclassified investment and off 4,753.68 4,753.68 4,508.80
balance sheet exposure)
2.2 Assets revaluation reserves up to 50% 5,749.49 5,749.49 5,749.49
2.3 Revaluation reserves of securities up to 50% 40.75 40.75 31.30
2.4 Revaluation reserves for equity instruments up to 10% - - -
2.5 All other preference shares - - -
2.6 Perpetual subordinated debt (Mudaraba Perpetual Bond) 3,000.00 3,000.00 3,000.00
2.7 Others (if any item approved by Bangladesh Bank) - - -
2.8 Sub-total (2.1 to 2.7) 13,543.92 13,543.92 13,289.59
2.9 Deductions, if any - - -
2.10 Total Eligible Tier-2 Capital (2.8 - 2.9) 13,543.92 13,543.92 13,289.59
19.3 Tier-3 (Additional supplementary capital)
3.1 Short-term subordinated debt - - -
4. Total supplementary capital (2.10+3) 13,543.92 13,543.92 13,289.59
5. Total regulatory capital (1.19+4) 48,541.61 48,569.86 45,490.77
19.4 Risk Weighted Assets (RWA) for
1. Investment (credit) risk 336,165.95 336,701.42 287,207.41
(i) On-balance sheet 313,692.19 314,227.66 270,318.56
(ii) Off-balance sheet 22,473.76 22,473.76 16,888.85
2. Market Risk 6,394.91 6,394.91 744.20
3.Operational risk 35,906.44 35,646.39 30,962.08
Total Risk Weighted Assets (1+2+3) 378,467.30 378,742.72 318,913.69
31.12.2014 31.12.2013
Taka Taka
20.0 Statutory reserve
Opening balance 14,638,613,627 12,423,662,342
Add: Addition made this year 1,461,293,053 2,214,951,285
Closing balance 16,099,906,680 14,638,613,627
At least 20% of net profit before tax is transferred to statutory reserve account each year until the cumulative balance equal to
the amount of paid up capital account as per Section 24 of the Bank Company Act 1991 as amended. During the year 2014 the
Amount required to be equal to the amount of paid up capital was transferred to statutory reserve.

31.12.2014 31.12.2013
Taka Taka
21.0 Others reserves
General reserve (Note-21.1) 377,159,532 254,379,979
Assets revaluation reserve (Note-21.2) 11,498,971,320 11,498,971,320
Revaluation reserve of securities (Note-21.3) 81,500,000 62,600,000
Translation reserve (Note-21.4) 6,392,484 1,317,771
Share premium 1,989,633 1,989,633
Total 11,998,012,969 11,851,258,703
21.1 General reserve
Opening balance 254,379,979 130,439,979
Add: Addition/(adjustment) made this year 122,779,553 123,940,000
Closing balance 377,159,532 254,379,979
21.2 Assets revaluation reserve
Opening balance 11,498,971,320 11,498,971,320
Add: Addition/(adjustment) made this year - -
Closing balance 11,498,971,320 11,498,971,320
21.3 Revaluation reserve of securities
Opening balance 62,600,000 34,700,000
Add: Addition/(adjustment) made this year 18,900,000 27,900,000
Closing balance 81,500,000 62,600,000
21.4 Translation reserve
Opening balance 1,317,771 (3,303,771)
Add: Addition/ (adjustment) made this year 5,074,713 4,621,542
Closing balance 6,392,484 1,317,771
22.0 Letter of guarantee
(a) Claim against the bank which is not acknowledged as debt - -
(b) Money for which the bank is contingently liable in respect of guarantees
issued favouring :
i) Directors - -
ii) Government 210,589,850 771,904,461
iii) Bank and other financial institutions 500,000 457,275
iv) Others 8,628,895,740 6,582,232,915
Total 8,839,985,590 7,354,594,651
2014 2013
Taka Taka
23.0 Investment income
Income from general investment (Note-23.1) 48,521,667,089 47,083,761,335
Profit on deposits with other banks & financial institutions (Note-23.2) 588,289,290 1,061,703,045
Total 49,109,956,379 48,145,464,380
23.1 Income from general investment (*)
Bai Murabaha 29,474,302,572 28,494,774,596

Musharaka /Musharaka Documentary Bills 1,463,048,565 2,013,000,424
Bai Muajjal 4,477,450,761 3,235,748,522
Hire Purchase under Shirkatul Melk 11,755,116,774 11,621,383,638
Bai Salam 312,385,391 306,181,459
Bai -As- Sarf (FDB /FCD), IBP, MFCI and UPAS 285,866,022 221,367,054
Investment income: Off-shore Banking Unit (OBU) 753,497,004 450,098,863
Compensation income (*) - 741,206,779
Sub total 48,521,667,089 47,083,761,335
(*) This amount includes any amount transferred from profit/rent/compensation suspense due to recovery or regularization of
investment (i.e. due to declassification of investment) during the year. Amount transferred from profit/rent suspense is included
in the “Investment income under respective mode of investment” and amount transferred from compensation suspense is
included under “Compensation income”.

2014 2013
Taka Taka
23.2 Profit on deposits with other banks & financial institutions
In Bangladesh 588,289,290 1,061,703,045
Outside Bangladesh - -
Sub total 588,289,290 1,061,703,045
Grand total (23.1+23.2) 49,109,956,379 48,145,464,380
23.3 Investment income derived from the fund deployed by
Mudaraba deposits 42,524,199,777 42,360,516,514
Other deposits/fund 6,585,756,602 5,784,947,866
Total 49,109,956,379 48,145,464,380
23(a) Consolidated investment income
Total 49,109,956,379 48,145,464,380
24.0 Profit paid on mudaraba deposits
Profit paid on Mudaraba Savings Deposit 6,753,174,438 6,548,541,394
Profit paid on Mudaraba Term Deposit Account 11,963,579,333 10,933,682,496
Profit paid on other Mudaraba Deposits 11,424,508,214 12,018,664,519
Profit paid on Placement (*) 173,608,636 1,090,297,127
Profit paid on Mudaraba Perpetual Bond (MPB) 335,400,000 384,000,000
Total 30,650,270,621 30,975,185,536
* Profit paid on placement includes Tk 11,17,73,018 for 2014 (in 2013 Tk Nil) against profit paid on placement of off-shore
Banking Units (OBUs).
24(a) Consolidated profit paid on mudaraba deposits

Inter-company transactions (57,333,113) (74,905,974)
Total 30,592,937,508 30,900,279,562
25.0 Income from investments in shares & securities
i. Inside Bangladesh
Bangladesh Government Islamic Investment Bond (BGIIB) 1,784,915,681 2,032,412,208
Bangladesh Shipping Corporation (BSC) 2,000,000 -
Central Depository Bangladesh Ltd. (CDBL) 5,711,802 14,623,166
Income on Share Securities Trading 2,222,593 479,286
Islami Bank Capital Management Limited 104,997,550 -
Other Banks/companies 400,776 -
Sub total (i) 1,900,248,402 2,047,514,660
ii. Outside Bangladesh - -
Sub total (ii) - -
Grand total (i+ii) 1,900,248,402 2,047,514,660
25(a) Consolidated income from investments in shares & securities
Inter-company transactions (104,997,550) -
Total 1,847,241,058 2,112,029,193

2014 2013
Taka Taka
26.0 Commission, exchange & brokerage income
Commission income 3,477,847,228 3,062,812,206
Exchange income (Note 26.1) 2,392,526,280 1,906,313,841
Total 5,870,373,508 4,969,126,047
26.1 Exchange income
Gross exchange gain 2,392,526,280 1,906,313,841
Less: exchange loss - -
Net exchange gain 2,392,526,280 1,906,313,841
26(a) Consolidated commission, exchange & brokerage income
Islami Bank Capital Management - -
Limited
Total 5,883,332,280 4,978,658,614
27.0 Other operating income
Rent on locker 11,817,153 9,996,314
Telephone/ trunk call charge recovered 647,733 2,199,495
P&T charge recovered - 4,134,575
Income from ATM 47,806,594 -
E & TA fees recovered 1,195,640 984,515
Income from SWIFT 139,851,387 115,959,435
Account maintenance charges realised 703,099,468 676,603,675
Service charges recovered 37,111,895 29,097,431
Service charges recovered: OBU 13,871,627 8,223,565
Income from Mobile Wallet 4,095,642 1,280,876
Rent on premises realised 2,538,886 2,260,944
Sale proceeds of tender schedule 2,999,500 1,381,000
Profit on sale of bank’s car 21,249,366 3,055,859
MICR cheque charge realised 26,932,254 5,249,147
Others 153,231,826 71,211,785
Total 1,166,448,971 931,638,616
27(a) Consolidated other operating income
Islami Bank Bangladesh Limited 1,166,448,971 931,638,616
Inter Company Transactions (57,333,113) (74,905,974)
Total 1,223,373,942 985,819,291
28.0 Salary & allowances (*)
Basic pay 3,437,505,591 3,141,844,803
Allowances 2,396,531,797 2,231,927,682
Bonus 1,634,071,311 1,543,127,817
Contribution to provident fund 289,091,142 265,759,059
Contribution to Gratuity (**) 396,000,000 326,200,000
Contribution to benevolent fund 10,000,000 10,000,000
Contribution to superannuation fund (**) 20,000,000 20,000,000
Total 8,183,199,841 7,538,859,361
(*) The above salary & allowances includes Tk.36,11,290/- for 2014 (in 2013 Tk.30,70,104/-) against salary and allowances of
Off-shore Banking Units (OBUs).
(**) As per latest Actuarial valuation report, there was no shortfall in the fund to meet-up the related liability up to 31 December
2014.

2014 2013
Taka Taka
28(a) Consolidated salary & allowances
Total 8,197,568,114 7,552,761,347
29.0 Rent, taxes, insurances, electricity etc.
Rent, rates and taxes 362,139,320 288,073,881
Insurance 343,706,938 296,574,014
Electricity and lighting 290,293,609 237,491,433
Total 996,139,867 822,139,328
29(a) Consolidated rent, taxes, insurances, electricity etc.
Islami Bank Capital Management Limited - 499,765
Total 1,000,045,580 825,130,483
30.0 Legal expenses
Legal charges 16,206,043 35,067,030
30(a) Consolidated legal expenses
Islami Bank Securities Limited - 218,293
Total 16,206,043 35,285,323
31.0 Postage, stamps, telecommunications etc.
Telephone (*) 38,613,447 35,162,708
Postage 387,577 -
Fax & internet 8,072,366 9,176,881
Stamps charges 57,320 4,078
Total 47,130,710 44,343,667
(*) Telephone expenses includes Tk.3,010/- for 2014 (in 2013 Tk.Nil ) against Telephone bill of Off-shore Banking Units (OBUs).
31(a) Consolidated postage, stamps, telecommunications etc.
Islami Bank Capital Management - -
Limited
Total 47,306,134 44,536,896
32.0 Stationery, printing and advertisement etc.
Paper & table stationery 27,516,110 24,559,569
Printing and stationery (registers and 125,352,068 125,226,110
forms)
Advertisement & publicity 164,541,413 180,161,687
Total 317,409,591 329,947,366
32(a) Consolidated stationery, printing and advertisement etc.
Total 317,612,092 330,098,889

2014 2013
Taka Taka
33.0 Chief executive’s salary & fees
Basic pay 4,800,000 4,112,903
House rent allowance 480,000 480,000
Medical allowance 1,200,000 810,645
Utilities 120,000 120,000
Festival bonus 800,000 800,000
Incentive bonus 1,000,000 1,000,000
Total 8,400,000 7,323,548
34.0 Directors’ fees and expenses
Directors’ fees for attending board/ executive committee/ other committees meeting 2,431,100 3,554,150
TA/DA/hotel fare for local & foreign directors 8,973,833 7,040,132
Others 1,382,084 993,552
Total 12,787,017 11,587,834
34.1 Rate of fees for attending board/ executive committee/ other committees meeting
For board meeting 5,000 5,000
For executive committee/ other committees meeting 4,000 4,000
34(a) Consolidated directors’ fees and expenses
Total 13,183,767 11,875,334
35.0 Shari’ah supervisory committee’s fees & expenses
Shari’ah supervisory members’ fees for attending meeting 727,800 276,000
TA/DA./hotel fare 1,566,024 944,508
Others 268,300 180,915
Total 2,562,124 1,401,423
35.1 Rate of fees for attending shariah supervisory meeting
For shariah supervisory meeting 5,000 5,000
For sub-committee meeting 4,000 4,000
36.0 Auditors’ fees
Auditors’ fees 2,229,118 2,070,000
36(a) Consolidated auditors’ fees
Islami Bank Capital Management Limited 23,000 23,000
Total 2,344,118 2,168,000
37.0 Depreciation/amortization and repair to bank's assets
i) Depreciation/amortization
Premises (building) 140,627,745 139,324,573
Furniture & fixtures 48,274,318 44,271,448
Mechanical appliances 360,487,678 313,530,783
Motor vehicles 57,513,847 61,064,705
Books 644,035 473,073
ATM 77,925,469 61,535,459
Amortization: Intangible assets 82,825,438 26,060,893
Sub total (i) 768,298,530 646,260,934
ii) Repair of bank's properties/assets 93,702,876 79,452,710
Grand total (i+ii) 862,001,406 725,713,644

2014 2013
Taka Taka
37(a) Consolidated depreciation and repair to bank’s assets
Total 866,506,137 729,987,642
38.0 Other expenses
TA/ DA 133,384,530 109,070,556
Repairs to rented premises 6,363,602 6,979,119
Motor car running & maintenance 73,004,044 65,024,893
Periodicals & newspapers 9,983,541 9,909,093
Entertainment Expenses 44,048,136 42,579,158
Reimbursement expense-conveyance 82,598,993 78,905,070
Overtime 55,815,459 48,979,743
Training expenses 40,623,027 33,938,451
Meeting expenses 9,015,645 18,998,913
Bank charges (*) 10,222,740 17,913,449
Uniforms 12,710,324 10,559,151
Conveyance 10,968,375 10,278,692
Honorarium & cash award 18,361,924 21,477,061
Membership fees 5,487,280 3,758,982
Staff welfare 5,756,822 8,682,680
Evening banking allowance 2,592,127 2,470,570
Computer expenses 33,277,076 29,345,864
Wages 41,198,959 32,319,829
Discomfort allowance 17,413,263 14,201,904
Air condition maintenance 1,693,426 1,776,900
WASA / gas expenses 12,328,537 10,357,130
Washing charges 11,257,944 10,225,912
Transportation charges 4,144,936 3,468,423
ATM charges - 14,135,578
Reuters charges 6,260,715 6,525,363
Business development expenses 279,848,759 294,259,895
Photocopy expenses 16,817,513 15,504,196
Upkeep of office premises 18,478,138 15,988,657
Clearing house expenses 314,002 612,779
Bonus share issue expenses 4,599,355 5,403,049
Rating expenses 460,000 460,000
Band width charges 86,915,306 99,239,987
Other regulatory fees and expenses 5,000 177,212
MPB expenses 1,500,000 1,558,800
Recruitment expenses 5,468,222 2,594,456
Professional fees 2,053,424 2,039,500
Loss on sale of bank’s fixed asset 176,461 538,244
Khidmah card expenses 425,064 7,708,857
Mobile wallet expense 10,732,857 1,418,944
BACH Expense 333,529 198,056
Other RDS expenses (Note-38.1) 67,540,903 52,351,857
NPS network transactions charges 113,670 -
VISA expenses 13,723,464 -
Maintenance of software 23,754,600 -
Others 18,312,139 23,005,689
Total 1,200,083,831 1,134,942,662
(*) Bank charges include Tk.14,332/- for 2014 (in 2013 Tk.60,84,364/- ) against Bank charges of Off-shore Banking Units
(OBUs).

2014 2013
Taka Taka
38.1 Other RDS expenses
Risk allowance 37,147,498 28,556,603
By-cycle allowance 9,455,726 7,699,714
Motor cycle allowance 8,104,908 6,230,532
Field allowance 4,052,454 3,115,266
TA/ DA 1,350,818 1,038,422
Fuel 2,026,227 1,557,633
Stationary 3,377,045 2,596,055
Repairing 2,026,227 1,557,632
Total 67,540,903 52,351,857
38.2 Motor car running and maintenance
As on 31.12.2014 the Bank had 255 (Two hundred fifty five) Motor Vehicles (Cars -206, Jeeps -10, Pickup-36 and Microbuses -3).
The Motor Vehicles are used for carrying cash, development works and for other important works of the Bank. Some vehicles are
attached with the senior executives of the Bank as per transport policy of the Bank. A sum of Tk.73,004,044/- was incurred during
the year ended on 31.12.2014 as against Tk.65,024,893/- incurred during the year 2013 for repairs, maintenance, purchase of
fuel & lubricants and insurance etc. for the motor vehicles of the Bank.
38.3 VAT related to expenditures
All the expenditures reported in this Financial Statements are inclusive of VAT except for specific items which are exempted from
VAT by appropriate authority.
38(a) Consolidated other expenses

Islami Bank Capital Management Limited 679,131 90,611
Total 1,205,550,108 1,138,621,359
39.0 Retained earnings: movement of surplus in profit & loss account
Retained earnings as on 1 January 2,634,530,184 3,152,246,877

Add: Net profit after tax 3,999,058,608 4,948,584,592
Sub-total 6,633,588,792 8,100,831,469
Less:
Transfer to statutory reserve 1,461,293,053 2,214,951,285
Transfer to/(from) general reserve 122,779,553 123,940,000
Dividend paid (Bonus share & cash dividend) 2,634,530,184 3,127,410,000
Sub-total 4,218,602,790 5,466,301,285
Balance of retained earnings as at 31 December 2,414,986,002 2,634,530,184
39(a) Consolidated retained earnings
Retained earnings as on 1 January 2,637,858,071 3,073,402,299

Add: Net profit attributable to equity holders of IBBL 3,967,415,282 5,030,757,057
Sub-total 6,605,273,353 8,104,159,356
Less:
Transfer to statutory reserve 1,461,293,053 2,214,951,285
Transfer to/(from) general reserve 122,779,553 123,940,000
Dividend paid (Bonus share & cash dividend) 2,634,530,184 3,127,410,000
Sub-total 4,218,602,790 5,466,301,285
Balance of retained earnings as at 31 December 2,386,670,563 2,637,858,071

39(b) Non-controlling interest Amount in Taka
Share of profit or
Particulars As on 01.01.2014 (loss) for the year As on 31.12.2014 As on 31.12.2013
2014
Islami Bank Securities Limited 52,476 800 53,276 52,476
Less: Dividend - -
Sub-total 53,276 52,476
Islami Bank Capital Management Limited 8,856 778 9,634 8,856
Less: Dividend 2,450 -
Sub-total 7,184 8,856
Total 61,332 1,578 60,460 61,332
The share capital of Islami Bank Securities Ltd. is Tk.2,700,000,000/- divided into 2,700,000 shares of Tk.1,000/ each out of
which share capital of minority is Tk.54,000/- divided into 54 shares of Tk.1,000/- each which represent 0.0020% of total share
of the subsidiary Company.
The share capital of Islami Bank Capital Management Ltd. is Tk.300,000,000/- divided into 300,000 shares of Tk.1,000/ each out
of which share capital of minority is Tk.7,000/- divided into 7 shares of Tk.1,000/- each which represent 0.0023% of total share
of the subsidiary Company.
40.0 Events after reporting period
The Board of Directors of the Bank in its 217th meeting held on 21 March 2015 recommended 15% Cash Dividend for the year
2014 subject to approval of the shareholders in the ensuing 32nd Annual General Meeting to be held on 13 June 2015.
2014 2013
Taka Taka
41.0 Earnings per share (EPS)
a) Attributable profit for the year 3,999,058,608 4,948,584,592
b) Weighted average number of ordinary share during the year 1,609,990,668 1,609,990,668
Basic earnings per share (EPS) (a ÷ b) 2.48 3.07
Previous year’s figures have been adjusted due to issuance of 14,63,62,788 bonus shares during the year 2014 against 10% Stock
Dividend of 2013 as per guidelines of BAS 33, “Earnings per share”. Diluted earnings per share is not applicable since there is no
possibility of dilution of shares during the year.
41(a) Consolidated earnings per share
Consolidated profit after tax 3,967,416,860 5,030,758,795
Less: Profit attributable to non-controlling interest 1,578 1,738
Attributable profit for distribution to shareholders of IBBL 3,967,415,282 5,030,757,057
Weighted average number of ordinary share during the year 1,609,990,668 1,609,990,668
Consolidated basic earnings per share 2.46 3.12
42.0 Net asset value per share (NAV)
a) Capital/shareholders’ equity for the year 46,612,812,331 43,760,681,314
Net asset value per share (NAV) (a ÷ b) 28.95 27.18
Net asset value per share (NAV) has been disclosed as per the Bangladesh Securities and Exchange Commission’s Notification No.SEC/
CMRRCD/2009-193/Admin/03-31 dated June 1, 2009. Previous year’s number of ordinary shares has been adjusted to confirm current
year’s presentation due to issuance of 14,63,62,788 bonus shares during the year 2014 against stock dividend of 2013.
43.0 Net operating cash flow per share (NOCFPS)
a) Net cash flows from operating activities 47,532,710,859 34,521,082,274
Net operating cash flow per share (NOCFPS) (a ÷ b) 29.52 21.44
Net operating cash flow per share (NOCFPS) has been disclosed as per the Bangladesh Securities and Exchange Commission’s
Notification No.SEC/CMRRCD/2009-193/Admin/03-31 dated June 1, 2009. Previous year’s number of ordinary shares has been
adjusted to confirm current year’s presentation due to issuance of 14,63,62,788 bonus shares during the year 2014 against 10%
stock dividend of 2013.

31.12.2014 31.12.2013
Taka Taka
44.0 Reconciliation of cash and cash equivalent at the end of the year
Cash in hand 7,696,844,549 8,180,338,285
Balance with Bangladesh Bank and its agent banks (Sonali Bank Ltd.) 38,522,514,877 36,111,176,654
Balance with other banks and financial institutions 20,199,350,245 12,327,320,344
Total 66,418,709,671 56,618,835,283
44(a) Reconciliation of consolidated cash and cash equivalent at the end of the year
Cash in hand 7,696,844,962 8,180,346,965
Balance with Bangladesh Bank and its agent banks (Sonali Bank Ltd.) 38,522,514,877 36,111,176,654
Balance with other banks and financial institutions 23,615,218,198 12,700,116,779
Total 69,834,578,037 56,991,640,398
45.0 Operating lease payments disclosure 2014 2013

Taka (in million) Taka (in million)
Non-cancellable operating lease rentals for the Bank are payable as follows:
Less than 1 year 406 350
Between 1 and 5 years 2,300 2,515
More than 5 years 4,740 8,750
Total 7,446 11,615
31.12.2014(Taka) 31.12.2013 (Taka)

46.0 Placement from banks & other financial institutions
Borrowing from Abroad-OBU 6,098,512,743 -
Borrowing from the other Banks in Bangladesh-OBU 1,558,988,000 -
Borrowing from Treasury Division, IBBL-OBU (Note-6.0_OBU) 7,606,631,085 16,213,482,904
Fund obtained by AD branches from OBU for MDB in FC (Note-3.0_OBU) 2,859,555,231 3,497,773,330
Sub total 18,123,687,059 19,711,256,234
Less: Borrowing from Treasury Division, IBBL-OBU 7,606,631,085 16,213,482,904
Less: Fund obtained by AD branches from OBU for MDB in FC 2,859,555,231 3,497,773,330
Sub total 10,466,186,316 19,711,256,234
Total 7,657,500,743 -
Fund obtained from OBU for investment in MDB in FC by AD branches is shown under “Cover fund MDB investment” under other
liabilities at AD branches whereas Fund provided to AD branches for MDB in FC is shown under “ Placement with banks & other
financial institutions” in the assets side at OBU’s balance sheet. As the items are intra-units balance, the amount was fully
eliminated while preparing the financial statement of the Bank as a whole.
46(a) Consolidated placement from banks & other financial institutions
Islami Bank Bangladesh Limited 7,657,500,743 -
Total 7,657,500,743 -
47.0 Currency wise exposures
Currency wise exposures are shown at Annexure-C.
Date : Dhaka
21 March 2015

Annexure - A
244
Fixed Assets Schedule
(Amount in Taka)
Cost Depreciation/Amortization Written down value
Sale /
Particulars Addition Charged Adjustment
Annual Report 2014

Balance as at adjustment Total as at Charged upto Total as at as at as at
during the during the during the
01.01.2014 during the 31.12.2014 01.01.2014 31.12.2014 31.12.2014 31.12.2013
year year year
year
1 2 3 4 5 (2 + 3 - 4) 6 7 8 9 (6+ 7 - 8) 10 (5 - 9) 11
A. Tangible Assets
i) Premises
Land 7,592,598,419 668,131 - 7,593,266,550 - - - - 7,593,266,550 7,592,598,418
Building 6,234,391,377 83,002,457 - 6,317,393,834 674,108,520 140,627,745 - 814,736,265 5,502,657,569 5,560,282,857
Construction/capital work 103,812,967 93,294,031 - 197,106,998 - - - - 197,106,998 103,812,967

in process
Sub total (i) 13,930,802,763 176,964,619 - 14,107,767,382 674,108,520 140,627,745 - 814,736,265 13,293,031,116 13,256,694,242
ii) Other fixed assets
Furniture and fixtures 719,377,288 93,886,184 1,574,750 811,688,722 285,489,775 48,274,318 611,122 333,152,971 478,535,751 433,887,513
Mechanical appliances 2,721,050,008 382,712,680 5,299,125 3,098,463,563 1,478,796,723 360,487,678 2,467,124 1,836,817,277 1,261,646,286 1,242,253,285
Motor vehicles 525,169,792 89,248,048 14,979,210 599,438,630 373,935,683 57,513,847 9,767,868 421,681,662 177,756,969 151,234,110
Books 4,773,584 1,108,372 6,000 5,875,956 3,342,856 644,035 4,080 3,982,811 1,893,145 1,430,728
ATM 482,830,169 150,102,635 58,000 632,874,804 118,941,517 77,925,469 48,000 196,818,986 436,055,818 363,888,652
Sub Total (ii) 4,453,200,841 717,057,919 21,917,085 5,148,341,675 2,260,506,554 544,845,347 12,898,194 2,792,453,707 2,355,887,969 2,192,694,288
Total (i+ii) 18,384,003,604 894,022,538 21,917,085 19,256,109,057 2,934,615,074 685,473,092 12,898,194 3,607,189,972 15,648,919,085 15,449,388,530
B. Intangible assets 309,480,952 76,848,210 - 386,329,162 26,060,893 82,825,438 - 108,886,331 277,442,831 283,420,059
Total (A+B) 18,693,484,556 970,870,748 21,917,085 19,642,438,219 2,960,675,967 768,298,530 12,898,194 3,716,076,303 15,926,361,916 15,732,808,589
Annexure -B

Consolidated Fixed Assets Schedule
(Amount in Taka)
Cost Depreciation/Amortization Written down value
Particulars Sale / Adjustment

Balance as at Addition during Total as at Charged upto Charged during Total as at
adjustment during the as at 31.12.2014 as at 31.12.2013
01.01.2014 the year 31.12.2014 01.01.2014 the year 31.12.2014
during the year year
1 2 3 4 5 (2 + 3 - 4) 6 7 8 9 (6+ 7 - 8) 10 (5 - 9) 11
A. Tangible Assets
i) Premises
Land 7,592,598,419 668,131 - 7,593,266,550 - - - - 7,593,266,550 7,592,598,418
Building 6,234,391,377 83,002,457 - 6,317,393,834 674,108,520 140,627,745 - 814,736,265 5,502,657,569 5,560,282,857
Construction/capital work in process 103,812,967 93,294,031 - 197,106,998 - - - - 197,106,998 103,812,967
Sub total (i) 13,930,802,763 176,964,619 - 14,107,767,382 674,108,520 140,627,745 - 814,736,265 13,293,031,116 13,256,694,242
ii) Other fixed assets
Furniture and fixtures 721,573,047 93,921,228 1,574,750 813,919,525 286,274,362 48,465,388 611,122 334,128,628 479,790,897 435,298,685
Mechanical appliances 2,725,837,619 383,311,084 5,299,125 3,103,849,578 1,481,787,048 361,538,852 2,467,124 1,840,858,776 1,262,990,802 1,244,050,572
Motor vehicles 530,785,792 89,428,067 14,979,210 605,234,649 377,434,117 58,653,619 9,767,868 426,319,868 178,914,782 153,351,675
Books 4,773,584 1,108,372 6,000 5,875,956 3,342,856 644,035 4,080 3,982,811 1,893,145 1,430,728
ATM 482,830,169 150,102,635 58,000 632,874,804 118,941,517 77,925,469 48,000 196,818,986 436,055,818 363,888,652
Sub Total (ii) 4,465,800,211 717,871,386 21,917,085 5,161,754,512 2,267,779,900 547,227,363 12,898,194 2,802,109,069 2,359,645,444 2,198,020,312
Total (i+ii) 18,396,602,974 894,836,005 21,917,085 19,269,521,894 2,941,888,420 687,855,108 12,898,194 3,616,845,334 15,652,676,560 15,454,714,554
Annual Report 2014

B. Intangible Assets 311,002,860 76,868,065 - 387,870,925 26,858,731 83,209,165 - 110,067,896 277,803,029 284,144,129
Total (A+B) 18,707,605,834 971,704,070 21,917,085 19,657,392,819 2,968,747,151 771,064,273 12,898,194 3,726,913,230 15,930,479,589 15,738,858,683
245
Annexure - C
246
Currency wise Exposures
(Amount in Taka)
Equivalent Taka of Other
Taka Equivalent Taka of US Dollar Equivalent Taka of GBP Equivalent Taka of EURO Total Taka
ASSETS Currency
2014 2013 2014 2013 2014 2013 2014 2013 2014 2013 2014 2013
1 2 3 4 5 6 7 8 9 10 11 12 13
Annual Report 2014

Cash in hand 7,647,881,565 8,155,182,740 48,722,803 24,346,613 41,111 58,916 109,379 474,284 89,691 275,732 7,696,844,549 8,180,338,285
Balance with Bangladesh Bank & its 37,858,294,659 34,981,990,434 617,769,125 1,089,058,043 11,307,816 10,981,155 34,948,937 28,924,578 194,340 222,444 38,522,514,877 36,111,176,654
agent bank
Balance with banks & other financial 17,790,027,698 7,577,940,830 1,157,364,999 3,667,751,841 261,896,324 97,715,292 602,711,894 263,884,950 387,349,330 720,027,431 20,199,350,245 12,327,320,344
institutions
Placement with other banks & financial 2,000,000,000 - - - - - - - - - 2,000,000,000 -
institutions
Investments (in shares & securities) 100,856,528,896 67,211,398,968 - - - - - - - - 100,856,528,896 67,211,398,968
Investments 426,833,512,348 382,430,515,905 36,641,955,118 20,764,289,072 - - - - - - 463,475,467,466 403,194,804,977
Fixed assets including premises 15,926,361,916 15,732,808,589 - - - - - - - - 15,926,361,916 15,732,808,589
Other assets 3,386,322,373 4,291,755,522 358,648,429 179,188,902 - 6,029 - 832,684 - - 3,744,970,802 4,471,783,137
Non banking assets - - - - - - - - - - - -
Total assets 612,298,929,455 520,381,592,988 38,824,460,474 25,724,634,471 273,245,251 108,761,392 637,770,210 294,116,496 387,633,361 720,525,607 652,422,038,751 547,229,630,954
Equivalent Taka of Other

Taka Equivalent Taka of US Dollar Equivalent Taka of GBP Equivalent Taka of EURO Total Taka
LIABILITIES Currency
2014 2013 2014 2013 2014 2013 2014 2013 2014 2013 2014 2013
Placement from Bangladesh Bank, other
- - 7,657,500,743 - - - - - - - 7,657,500,743 -
banks, financial institutions and agents
Deposits 543,127,194,723 459,532,693,256 13,535,339,386 9,229,002,810 27,861,803 18,116,254 355,500,055 231,152,643 510,768 332,111 557,046,406,735 469,011,297,074
Bills payable 3,644,712,827 4,129,657,957 5,181,274 - - - - - - - 3,649,894,101 4,129,657,957
Other liabilities 34,455,424,841 27,327,994,609 - - - - - - - - 34,455,424,841 27,327,994,609
Mudaraba Perpetual Bond 3,000,000,000 3,000,000,000 - - - - - - - - 3,000,000,000 3,000,000,000
Total liabilities 584,227,332,391 493,990,345,822 21,198,021,403 9,229,002,810 27,861,803 18,116,254 355,500,055 231,152,643 510,768 332,111 605,809,226,420 503,468,949,640
Net position 28,071,597,064 26,391,247,166 1,7626,439,071 16,495,631,661 245,383,448 90,645,138 282,270,155 62,963,853 387,122,593 720,193,496 46,612,812,331 43,760,681,314
Annexure -D

Consolidated segment reporting
A. Segmental operating profit and loss
(Amount in Taka)
Head Office
Dhaka Central Dhaka South Dhaka North Chittagong
Particulars Controlled Khulna Zone Comilla Zone Rajshahi Zone Noakhali Zone Common Consolidated
Zone Zone Zone South Zone
Branchs
Investment income 7,864,341,582 8,164,272,643 3,357,034,251 5,207,671,642 2,214,698,264 1,381,198,679 3,955,241,973 5,048,351,987 1,153,183,876 12,611,202,540 50,957,197,437
Profit paid on mudaraba deposits (1,887,603,968) (2,635,463,005) (2,288,508,458) (3,182,566,357) (2,049,353,121) (2,265,280,882) (1,504,269,560) (2,802,332,105) (2,210,472,418) (9,767,087,634) (30,592,937,508)
Profit received/(paid) on IB General
(2,995,601,682) (2,048,341,657) 1,128,394,251 1,133,524,687 1,301,884,659 2,568,262,468 (428,021,357) 431,023,876 2,445,321,547 (3,536,446,792) -
Account
Net investment income 2,981,135,932 3,480,467,981 2,196,920,044 3,158,629,972 1,467,229,802 1,684,180,265 2,022,951,056 2,677,043,758 1,388,033,005 (692,331,886) 20,364,259,929
Commission, exchange & other income 1,183,114,261 888,332,465 381,240,643 591,274,628 381,142,543 137,224,265 274,092,973 321,443,879 139,913,791 2,808,926,774 7,106,706,222
Total operating income 4,164,250,193 4,368,800,446 2,578,160,687 3,749,904,600 1,848,372,345 1,821,404,530 2,297,044,029 2,998,487,637 1,527,946,796 2,116,594,888 27,470,966,151
Total operating expenses (538,794,877) (695,398,051) (780,202,766) (792,734,809) (770,344,629) (511,307,729) (556,638,624) (536,198,974) (443,393,362) (6,478,255,637) (12,103,269,458)
Operating Profit 3,625,455,316 3,673,402,395 1,797,957,921 2,957,169,791 1,078,027,716 1,310,096,801 1,740,405,405 2,462,288,663 1,084,553,434 (4,361,660,749) 15,367,696,693
There are 16 operating segments including subsidiaries as on 31 December 2014. Out of which only 9 are reportable as per BFRS 8 “Operating Segments”. Hence other non-reportable segments have been shown as under ‘Common’.

Amount in Taka
Head Office
Dhaka Central Dhaka South Dhaka North Chittagong
Particulars Controlled Khulna Zone Comilla Zone Rajshahi Zone Noakhali Zone Common Consolidated
Zone Zone Zone South Zone
Branchs
Investment income 8,850,061,231 8,467,833,468 3,300,224,635 4,289,568,264 2,562,132,953 1,132,539,642 3,624,821,354 5,049,003,654 1,035,462,681 11,945,845,691 50,257,493,573
Profit paid on mudaraba deposits (2,213,780,129) (2,687,852,731) (2,195,387,404) (3,152,415,866) (1,924,440,219) (2,083,358,988) (1,905,284,361) (2,675,451,636) (2,187,881,603) (9,874,426,625) (30,900,279,562)
Profit received/(paid) on IB General
(3,981,703,952) (2,673,936,842) 687,172,364 1,520,594,627 762,881,352 2,438,651,347 (633,703,542) 10,434,682 2,463,431,534 (593,821,570) -
Account
Net investment income 2,654,577,150 3,106,043,895 1,792,009,595 2,657,747,025 1,400,574,086 1,487,832,001 1,085,833,451 2,383,986,700 1,311,012,612 1,477,597,496 19,357,214,011
Commission, exchange & other income 1,165,664,361 740,691,352 335,132,621 512,551,352 263,271,652 114,687,652 217,713,564 342,758,651 115,364,367 2,156,642,333 5,964,477,905
Total operating income 3,820,241,511 3,846,735,247 2,127,142,216 3,170,298,377 1,663,845,738 1,602,519,653 1,303,547,015 2,726,745,351 1,426,376,979 3,634,239,829 25,321,691,916
Total operating expenses (532,128,438) (649,053,469) (695,175,209) (707,696,301) (707,106,124) (445,719,291) (426,624,352) (459,786,061) (391,665,388) (6,049,986,545) (11,064,941,178)
Operating Profit 3,288,113,073 3,197,681,778 1,431,967,007 2,462,602,076 956,739,614 1,156,800,362 876,922,663 2,266,959,290 1,034,711,591 (2,415,746,716) 14,256,750,738
Annual Report 2014

B. Segmental assets and liabilities
The necessary information regarding assets and liabilities of operating segments (except subsidiaries) are not separable and individually identifiable for this purpose. For this reason the assets and liabilities of the respective segments have not
247
been presented here.
Annexure - E
Islami Bank Bangladesh Limited (Off-Shore Banking Unit)
Balance Sheet
31.12.2014 31.12.2013
Particulars Notes
USD BD.Taka USD BD.Taka
Property and assets
Cash in hand - - - -
Cash in hand (including foreign currency) - - - -
Balance with Bangladesh Bank & its agent bank(s) (including
foreign currency) - - - -
Balance with other banks & financial institutions 892,907.33 69,601,591 - -
In Bangladesh 2.0 892,907.33 69,601,591 - -
Outside Bangladesh - - - -
Placement with banks & other financial institutions 3.0 36,684,763 2,859,555,231 46,427,658.56 3,609,750,453
Investments in shares & securities - - - -
Government - - - -
Others - - - -
Investments 158,017,332.85 12,317,356,285 162,105,883.62 12,603,732,451
General investments etc. - - - -
Bills purchased & discounted 4.0 158,017,332.85 12,317,356,285 162,105,883.62 12,603,732,451
Fixed assets - - - -
Other assets 5.0 342,277.67 26,680,339 - -
Non - banking assets - - - -
Total property and assets 195,937,280.41 15,273,193,446 208,533,542.18 16,213,482,904
Liabilities
Placement from banks & other financial institutions 6.0 195,821,030.41 15,264,131,828 208,533,542.18 16,213,482,904
Deposits & other accounts - - - -
Mudaraba Savings Deposits - - - -
Mudaraba Term Deposits - - - -
Other Mudaraba Deposits - - - -
Al- Wadeeah Current and other deposit accounts - - - -
Bills payable - - - -
Other liabilities 7.0 116,250.00 9,061,618 - -
Deferred tax liabilities /(assets) - - - -
Total liabilities 195,937,280.41 15,273,193,446 208,533,542.18 16,213,482,904
Capital/ share-holders’ equity - - - -
Paid - up capital - - - -
Statutory reserve - - - -
Other /translation reserves 8.0 - 6,392,485 - 1,317,771
Retained earnings 17.0 - (6,392,485) - (1,317,771)
Total liabilities & shareholders’ equity 195,937,280.41 15,273,193,446 208,533,542.18 16,213,482,904
Off-balance sheet items - - - -
Acceptances & endorsements - - - -
Letters of guarantee - - - -
Irrevocable letters of credit (including back to back bills) - - - -
Bills for collection - - - -
Other contingent liabilities - - - -
Total - - - -
Other commitments
Documentary credits, short term and trade related transactions - - - -
Forward assets purchased and forward deposits placed - - - -
Undrawn note issuance, revolving and underwriting facilities - - - -
Undrawn formal standby facilities, credit lines and other
commitments - - - -
Total - - - -
Total off-balance sheet items including contingent liabilities - - - -

Profit & Loss Account
31.12.2014 31.12.2013
Particulars
Notes USD Taka BD.Taka BD.Taka
Operating income
Investment income 9.0 9,757,668.45 753,497,004 5,805,716.31 450,098,863
Profit paid on mudaraba deposits 10.0 (1,444,438.12) (111,773,018) - -
Net investment income 8,313,230.33 641,723,986 5,805,716.31 450,098,863
Income from investments in shares & securities - - - -

Commission, exchange & brokerage income - - - -
Other operating income 11.0 179,765.00 13,871,627 106,200.00 8,223,565
Total operating income 8,492,995.33 655,595,613 5,911,916.31 458,322,428
Operating expenses
Salary & allowances 12.0 46,786.43 3,611,290 39,565.18 3,070,104

Rent, taxes, insurances, electricity etc. - - - -
Legal expenses - - - -
Postage, stamps and telecommunication etc. 13.0 38.86 3,010 - -
Stationery, printing and advertisement etc. - - - -
Chief executive’s salary & fees - - - -
Directors’ fees & expenses - - - -
Shari’ah supervisory committee’s fees & expenses - - - -
Auditors’ fees - - - -
Charges on investment losses - - - -
Depreciation and repair to bank’s assets - - - -
Zakat expenses - - - -
Other expenses 14.0 185.00 14,332 78,322.44 6,084,364
Total operating expenses 47,010.29 3,628,632 117,887.62 9,154,468
Profit/ (loss) before provision 8,445,985.04 651,966,981 5,794,028.69 449,167,960
Provision for investments & off- balance sheet items 15.0 - - - -

Provision for diminution in value of investments in shares - - - -
Other provisions - - - -
Total provision - - - -
Total profit/(loss) before taxes 8,445,985.04 651,966,981 5,794,028.69 449,167,960

Current tax 16.0 - - - -
Deferred tax 16.0 - - - -
Net profit/ (loss) after tax 8,445,985.04 651,966,981 5,794,028.69 449,167,960
Retained earnings from previous year - - - -
Less: Interim dividend paid - - - -
Add: Net profit after tax 8,445,985.04 651,966,981 5,794,028.69 449,167,960
Profit available for appropriation 8,445,985.04 651,966,981 5,794,028.69 449,167,960
Less: Appropriation - - - -
Statutory reserve - - - -
General reserve - - - -
Transferred to main operation 17.0 8,445,985.04 658,359,466 5,794,028.69 450,485,731
Retained earnings - (6,392,485) - (1,317,771)

Cash Flow Statement
31.12.2014 31.12.2013
Particulars
Investment income 9,757,668.45 753,497,004 5,805,716.31 450,098,863
Profit paid on mudaraba deposits (1,670,465.79) (129,391,739) - -
Income/ dividend receipt from investments in shares & securities - -
Fees & commission receipt in cash - - - -
Recovery from written off investments - - - -
Payments to employees (46,786.43) (3,611,290) (39,565.18) (3,070,104)
Cash payments to suppliers - - - -
Income tax paid - - - -
Receipts from other operating activities 179,765.00 13,871,627 106,200.00 8,223,565
Payments for other operating activities (223.86) (17,342) (78,322.44) (6,084,364)
i) Operating profit before changes in operating assets & liabilities 8,219,957.37 634,348,260 5,794,028.69 449,167,960
Increase/decrease of statutory deposits - - - -
Increase/decrease of net trading securities - - - -
Increase/decrease of placement to other banks 9,742,896.00 750,195,222 (46,427,658.56) (3,609,750,453)
Increase/decrease of investments to customers 4,088,550.77 286,376,166 (37,637,578.88) (2,664,950,764)
Increase/decrease of other assets - - - -
Increase/decrease of deposits from other banks - - - -
Increase/decrease of deposits received from customers - - - -
Increase/decrease of other liabilities account of customers - - - -
Increase/decrease of trading liabilities - - - -
Increase/decrease of other liabilities - - - -
(ii) Cash flows from operating assets and liabilities 13,831,446.77 1,036,571,388 (84,065,237.44) (6,274,701,217)
Net cash flows from operating activities (A)=(i+ii) 22,051,404.14 1,670,919,648 (78,271,208.75) (5,825,533,257)
Proceeds from sale of securities - - - -
Payment for purchase of securities/membership - - - -
Purchase/sale of property, plants & equipments - - - -
Purchase/sale of subsidiaries - - - -
Net cash flows from investing activities (B) - - - -
Receipts from issue of debt instruments - - - -
Payment for redemption of debt instruments - - - -
Fund obtained from banks & other financial institutions (12,712,511.77) (949,351,076) 84,065,237.44 6,274,701,217
Profit transferred to main operation (8,445,985.04) (658,359,466) (5,794,028.69) (450,485,731)
Net cash flows from financing activities (C) (21,158,496.81) (1,607,710,542) 78,271,208.75 5,824,215,486
Net increase/(decrease) in cash (A+B+C) 892,907.33 63,209,106 - (1,317,771)
Add/(less) effects of exchange rate changes on cash & cash - 6,392,485 - 1,317,771
equivalent
Add:cash & cash equivalents at beginning of the year - - - -
Cash & cash equivalents at the end of the year 892,907.33 69,601,591 - -

Notes to the financial statements
1.0 Status of the Company
Off-shore Banking Units (OBU) of Islami Bank Bangladesh Ltd. governed under the rules and guidelines of Bangladesh Bank.
The Bank obtained permission from Bangladesh Bank for operating of Off-shore Banking Units located at Head Office Complex
Branch, Dhaka, Agrabad Branch, Chittagong and Uttara Branch, Dhaka vide Bangladesh Bank letter no. BRPD (P-3)744
(111)/2010-1032 dated 28 March 2010. The Bank has Commenced the operation of its Off-shore Banking Units from 08.02.2011
at Head Office Complex Branch, Dhaka and from 27.09.2011 at Agrabad Branch, Chittagong.
1.1 Principal activities
The principal activities of the OBU are to provide mudaraba investment against payment of import bills under UPAS (Usance
Payment at Sight) to its customers of Off-shore Banking Units in Bangladesh.
1.2 Significant accounting policies and basis of preparation of financial statements
1.2.1 Basis of accounting
The Off-shore Banking Units maintain its accounting records in USD from which accounts are prepared according to the Bank
Company Act, 1991 as amended up to 2013, Bangladesh Financial Reporting Standards (BFRSs) and other applicable directives
issued by Bangladesh Bank. All the financial statements relating the OBU has already been accounted for in the separate
financial statements of the Bank (considering necessary adjustments relating to intra-units transactions and balances). Along
with that, this financial statements relating to OBU only is prepared and disclosed in compliance with the requirements of
Bangladesh Bank.
1.2.2 Use of estimates and judgments
The preparation of financial statements requires management to make judgments, estimates and assumptions that affect the
application of accounting policies and the report amounts of assets, liabilities, income and expenses. Actual results may differ
from these estimates. The figures (Taka) appearing in these Financial Statements have been rounded off to the nearest integer.
1.2.3 Foreign currency transactions
a. Foreign currency transactions
Foreign currency transactions are converted in to equivalent Taka using the ruling exchange rates on the dates of respective
transactions as per BAS-21 “The Effects of changes in Foreign Exchange Rates”. Foreign currency balances held in US Dollars
are converted into Taka at weighted average rate of inter-bank market as determined by Bangladesh Bank on the closing date
of every month.
b. Transaction gains and losses
The resulting exchange transaction gains and losses are included in the profit and loss account.
1.2.4 Translation reserve
The activities of OBU is considered as foreign operation due to it’s different functional currency other than the non-OBU
operation of the Bank. As per BAS/IAS - 21, items of balance sheet of OBU has been translated to presentation currency using
closing rate and items of income and expenditure has been translated to presentation currency using spot rate prevailing on
the date of actual transaction, otherwise average rate has been used. Due to the above translation using two rates the arising
differences have been kept as translation reserve.
1.2.5 Retained earnings/Net profit transferred to main operation
As on 31 December the net income in USD/foreign currency of OBU is transferred to main operation of the Bank at exchange
rate prevailing on that date.

1.2.6 Cash flow statement
Cash flow statement has been prepared as per BRPD Circular No. 14, dated June 25, 2003 issued by the Banking Regulation
and Policy Department of Bangladesh Bank.
1.2.7 Reporting period
The financial statements cover from 01 January 2014 to 31 December 2014.
1.3 Assets and basis of their valuation
1.3.1 Cash and cash equivalents
Cash and cash equivalents include notes and coins on hand, unrestricted balances held with Bangladesh Bank and highly liquid
financial assets which are subject to insignificant risk of changes in their fair value, and are used by the unit’s management for
its short-term commitments.
1.3.2 Investments
Investment of OBU are stated in the balance sheet on net basis. Profit is calculated on daily product basis but charged and
account for on realisation/cash basis.
1.4 Allocation of common expenses
Establishment expenses in the nature of rent, rates, taxes, management expenses, printing and stationery, electricity, postage, stamps,
telecommunication and audit fees etc. have not been separately accounted for in the financial statements, but staff costs ( salaries
and allowances) are separately accounted for OBU.
1.5 Profit paid on Mudaraba Deposit/placement
OBU obtains fund under placement form abroad (different foreign Banks) and OBUs of different Banks in Bangladesh (BD)
based on Mudaraba Agreement and pays proportionate amount of investment income earned through deploying these fund
as profit. In some cases OBU pays profit at provisional rate in advance which is shown as “ Prepaid profit on placement” under
other assets.
Off-shore Banking Units (OBUs) of IBBL obtains fund under placement from its Head Office (Treasury Division), abroad (different
foreign Banks) and OBUs of different Banks in Bangladesh (BD) as per Bangladesh Bank Letter No BCD(P)744(27/1416, dated
17 December 1985.
31.12.2014 31.12.2013
2.0 Balance with other banks & financial institutions
In Bangladesh (balance with treasury division) 892,907.33 69,601,591 - -
Outside Bangladesh - - - -
Total 892,907.33 69,601,591 - -
3.0 Placement with banks & other financial institutions
Fund provided to AD Branches for MDB in FC* 36,684,762.56 2,859,555,231 46,427,658.56 3,609,750,453
* This amount has been provided to AD branches to finance investment in MDB in FC as per the requirement of the AD branches as
per Bangladesh Bank FE Circular No. - 03 dated 04 February 2013.
4.0 Investments 158,017,332.85 12,317,356,285 124,468,304.74 9,938,781,687
4.1 Bills purchased & discounted
Mudaraba Documentary Import Bills (MDIB-UPAS)* 158,017,332.85 12,317,356,285 162,105,883.62 12,603,732,451
Total 158,017,332.85 12,317,356,285 162,105,883.62 12,603,732,451
OBU allows the facilities as per Bangladesh Bank

BRPD circular no 28, dated 05 September-2010
5.0 Other assets
Prepaid profit on placement 342,277.67 26,680,339 - -
Total 342,277.67 26,680,339 - -

31.12.2014 31.12.2013
Islami Bank Bangladesh Ltd.-main operation 97,584,215.98 7,606,631,085 208,533,542.18 16,213,482,904
(Treasury Division)
Banks (in BD) 20,000,000.00 1,558,988,000
Banks (abroad) 78,236,814.43 6,098,512,743 - -
Total 195,821,030.41 15,264,131,828 208,533,542.18 16,213,482,904
Profit payable 116,250.00 9,061,618 - -
Total 116,250.00 9,061,618 - -
8.0 Translation reserve
Balance as on 1 January - 1,317,771 - (3,303,771)
Addition/(adjustment) during the year - 5,074,714 - 4,621,542
Balance as at 31 December - 6,392,485 - 1,317,771
9.0 Investment income
Mudaraba documentary import bills (UPAS) 8,177,416.22 631,589,277 5,621,443.36 435,870,767
Mudaraba documentary bills (MDB in FC) 1,580,252.23 121,907,727 184,272.95 14,228,096
Total 9,757,668.45 753,497,004 5,805,716.31 450,098,863
10.0 Profit paid on mudaraba deposits
Profit paid on Placement from Banks (abroad) 1,214,438.12 93,890,518 - -
Profit paid on Placement from Banks (in BD) 230,000.00 17,882,500 - -
Total 1,444,438.12 111,773,018 - -
11.0 Other Income
Service charge realized (MDIB-UPAS) 178,100.00 13,742,126 106,200.00 8,223,565
Service charge realized (Placement to AD Branches) 1,665.00 129,501 - -
Total 179,765.00 13,871,627 106,200.00 8,223,565
12.0 Salary & allowances :
Basic pay 19,882.79 1,534,687 16,813.98 1,304,700
Allowances 15,173.01 1,171,154 12,662.81 982,584
Bonus 9,742.35 751,980 8,406.99 652,350
Contribution to Provident Fund 1,988.28 153,469 1,681.40 130,470
Total 46,786.43 3,611,290 39,565.18 3,070,104
13.0 Postage, stamps and telecommunication etc.
Telephone Bill 38.86 3,010 - -
14.0 Other expenses
Bank Charges 185.00 14,332 78,322.44 6,084,364.00
15.0 Provision for investment
Provision for investment have not been separately accounted for in the financial statements of OBU. These are accounted for
directly in the main financial statements of the Bank.
16.0 Provision for tax
Provision for current and deferred tax have not been separately accounted for in the financial statements of OBU. These are
accounted for directly in the main financial statements of the Bank.
17.0 Retained earnings
Retained earnings as on 1 January - (1,317,771) - -
Addition during the year 8,445,985.04 651,966,981 5,794,028.69 449,167,960
Effect of translation reserve - 1,317,771 - -
Transferred to main operation 8,445,985.04 658,359,466 5,794,028.69 450,485,731
Balance as at 31 December - (6,392,485) - (1,317,771)

Islami Bank Securities Limited
• Report of the Directors

• Auditors’ Report
• Audited Financial Statements

Report of the Directors
Principal Activities
The principal activities of the company are to open beneficiary owner (BO) account under full DP of CDBL, provide Demate & Remate under
full DP of CDBL, provide trading facility under brokerage license, provide investment facility under Musharaka Mode and maintain own
portfolio under dealer account.
Directors
The following Directors have held the office of the Company as on the reporting date:
1. Engr. Md. Eskander Ali Khan, Chairman (Appointed 29 March, 2010)

2. Professor NRM Borhan Uddin, Ph.D.
Vice Chairman (Appointed 07 February, 2013)
3. Salahuddin Ahmed (Appointed 22 June, 2013)
4. Humayun Bokhteyar FCA (Appointed 22 June, 2013)
5. Mohd. Shamsul Haque (Appointed 29 March, 2010)
6. Md. Nurul Islam (Appointed 29 March, 2010)
7. Muhammad Abul Bashar (Appointed 06 September, 2011)
8. Md. Kabir Hossain (Appointed 27 May, 2014)
Auditors
Howladar Yunus & Co. Chartered Accountants were appointed as auditors of the Company.
Statement of directors’ responsibilities

The directors are responsible for preparing the Directors’ Report and the financial statements in accordance with applicable law and
regulations prevailed in the country.
Statement of disclosure to auditors
So far as the directors are aware, there is no relevant audit information of which the company’s auditors are unaware. Additionally, the
directors have taken all the necessary steps that they ought to have taken as directors in order to make themselves aware of all relevant
audit information and to establish that the company’s auditors are aware of that information.
Status of the Company
ISLAMI BANK SECURITIES LIMITED was incorporated on the 22 March 2010 under the Companies Act, 1994 as a public limited company.
It is a subsidiary company of Islami Bank Bangladesh Limited (IBBL) that holds all the shares of the company except 54 (Fifty four) shares
being held by six individual shareholders. The registered office of the company is situated at 20, Dilkusha, C/A in Dhaka, Bangladesh.
On behalf of the Board

Chairman

To the Shareholders of Islami Bank Securities Limited
We have audited the accompanying Financial Statements of Islami Bank Securities Limited, which comprise the statement of financial
position as at December 31 2014, and the statement of comprehensive income, statement of changes in equity and statement of cash flows
for the year then ended and a summary of significant accounting policies and other explanatory information.
Management’s responsibility for the Financial Statements
Management is responsible for the preparation and fair presentation of these financial statements in accordance with Bangladesh Financial
Reporting Standards (BFRS) and for such internal control as management determines is necessary to enable the preparation of financial
statements that are free from material misstatement whether due to fraud or error.
Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with
Bangladesh Standards on Auditing (BSA). Those standards require that we comply with ethical requirements and plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The
procedures selected depended on the auditor’s judgment, including the risks assessment of material misstatement of the financial
statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity’s
preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances,
but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. An audit also includes evaluating the
appropriateness of accounting policies used and the reasonableness of accounting estimates made by management, as well as evaluating
the overall presentation of the financial statements.
Opinion
In our opinion, the financial statements give a true and fair view of the financial position of Islami Bank Securities Limited as at December
31 2014, and of its financial performance and its cash flows for the year then ended in accordance with Bangladesh Financial Reporting
Standards (BFRS), Companies Act, 1994 and other applicable laws and regulations.
Report on Other Legal and Regulatory Requirements
We also report that:
(a) we have obtained all the material information and explanations which to the best of our knowledge and belief were necessary for
the purposes of our audit and made due verification thereof;
(b) in our opinion, proper books of account as required by law have been kept by the Company so far as it appeared from our
examination of those books;
(c) the Company’s financial position and financial performance dealt with by the report are in agreement with the books of account;
and
(d) the expenditure incurred was for the purposes of the Company’s business.
Dated: Dhaka
March 9, 2015

ISLAMI BANK SECURITIES LIMITED
as at 31 December 2014
Amount in Taka
Notes
31.12.2014 31.12.2013
Assets
Non-current assets 309,483,348 311,696,284

Property, plant and equipment 3 3,757,475 5,326,024
Intangible assets 4 360,198 724,070
Investment in TREC (Membership) 5 304,453,399 304,453,399
Preliminary expenses 6 108,025 216,050
Deferred revenue expenses 7 488,371 976,741
Deferred tax assets 8 315,880 -
Current assets 5,570,316,477 2,714,186,176
Cash and cash equivalents 9 346,324,458 193,816,863
Investment in securities 10 1,516,357,258 1,583,040,260
Accounts receivables 11 5,446,630 8,390,347
Advances, deposits and prepayments 12 54,024,522 23,651,723
Investment in MTDR 13 3,636,152,827 889,006,145
Other assets 14 12,010,782 16,280,838
Total assets 5,879,799,825 3,025,882,460
Equity and liabilities
Equity 2,663,812,682 2,623,809,180

Paid up capital 15 2,700,000,000 2,700,000,000
Retained earnings (36,187,318) (76,190,820)
Non-current liabilities 3,000,000,000 55,273

Deferred tax liability 16 - 55,273
Investment from IBBL 17 3,000,000,000 -
Current liabilities 215,987,143 402,018,007

Accounts payables 18 61,158,839 161,216,909
Provision for income tax 19 61,664,633 37,356,636
Accrued expenses 20 1,705,188 1,672,379
Quard against MTDR 21 90,000,000 200,000,000
Other current liabilities 22 1,458,483 1,772,083
Total equity and liabilities 5,879,799,825 3,025,882,460
The annexed notes form an integral part of these Financial Statements
A.K.M. Payer Ahammed Mohd. Shamsul Haque Engr. Md. Eskander Ali Khan
Chief Executive Officer Director Chairman
As per our annexed report of even date
Howladar Yunus & Co. Dated: Dhaka

Chartered Accountants 09 March, 2015

Statement of Comprehensive Income
for the year ended 31 December 2014
Amount in Taka
Notes
2014 2013
Operating income
Investment income 23 111,256,118 145,870,272
Brokerage commissions 24 12,958,772 9,532,567
Other operating income 25 2,328,313 1,940,579
Total operating income 126,543,203 157,343,418
Operating expenses
Salary and allowances 26 14,368,273 13,901,986
Rent, tax, insurance and electricity 27 3,905,713 2,491,390
BO accounts maintenance expenses 1,570,000 1,283,600
Brokerage expenses 28 708,703 498,773
Postage, stamps and communications 29 198,669 204,782
Stationery, printing and advertisements 30 202,501 151,523
Directors’ fees and expenses 31 396,750 287,500
Repair and maintenances 32 1,142,593 958,550
Legal fees - 142,500
CDS charges 962,971 793,581
Depreciation 33 2,382,016 2,352,384
Amortization 34 980,122 963,064
License expenses 35 160,000 60,600
Other expenses 36 1,362,226 1,015,772
Auditor’s fees 92,000 75,000
Total operating expenses 28,432,537 25,181,005
Operating profit 98,110,666 132,162,413
Provision for unrealized gain/(loss) 37 (33,109,478) (45,204,121)
Profit before tax 65,001,187 86,958,292
Less: Tax expenses
Current tax 25,368,838 33,362,272
Deferred tax (371,153) (342,586)
24,997,685 33,019,686
Net profit after tax 40,003,502 53,938,606
Other comprehensive income - -

Total comprehensive income for the year 40,003,502 53,938,606
The annexed notes form an integral part of these Financial Statements
As per our annexed report of even date
Howladar Yunus & Co. Dated: Dhaka

Chartered Accountants 09 March, 2015

Statement of Cash Flows
Amount in Taka
2014 2013
A. Cash flows from operating activities:
Net profit after tax 40,003,502 53,938,606

Adjustment for non-cash items:
Depreciation 2,382,016 2,352,384
Amortization 980,122 963,064
Provision for unrealized gain/(loss) 33,109,478 45,204,121
36,471,617 48,519,569
Cash flow before working capital changes 76,475,119 102,458,175
Changes in working capital:
Increase/(decrease) in accounts payable (100,058,070) 23,906,652
Increase/ (decrease) in provision for income tax 24,307,997 528,921
Increase /(decrease) in provision for expenses 32,809 1,228,197
Increase/ (decrease) in other current liabilities (313,600) 225,749
Increase/ (decrease) in deferred tax liabilities (55,273) (342,586)
Decrease/ (increase) in other assets 4,270,056 1,321,117
Decrease /(increase) in deferred tax assets (315,880) -
Decrease/ (increase) in advance, deposit & prepayments (30,372,799) (4,452,457)
Decrease/ (increase) in accounts receivable 2,943,717 23,340,762
(99,561,043) 45,756,355
Net cash flows from operating activities (23,085,924) 148,214,530
B. Cash flows from investing activities:
Acquisition of fixed assets (813,467) (160,029)
Acquisition of intangible assets (19,855) (72,000)
Investments in securities (1,142,118,859) (1,219,636,700)
Sale of investment in securities 1,175,692,382 836,868,609
Investments in MTDR (2,747,146,682) (67,676,666)
Net cash used in investment activities (2,714,406,481) (450,676,786)
C. Cash flows from financing activities:
Investment from IBBL 3,000,000,000 -
Quard against MTDR (110,000,000) 200,000,000
Net cash flows from financing activities 2,890,000,000 200,000,000
Net increase/(decrease) in cash & cash equivalents 152,507,595 (102,462,256)
Add: Cash & cash equivalents at the beginning of the year 193,816,863 296,279,119
Cash and cash equivalents at the end of the year 346,324,458 193,816,863
The annexed notes form an integral part of these Financial Statements.

Amount in Taka
Retained
Particulars Paid-up Capital Total Equity
Earnings
Opening balance as at 01 January 2013 2,700,000,000 (130,129,426) 2,569,870,574
Total comprehensive income for the year - 53,938,606 53,938,606
Balance as at 31 December 2013 2,700,000,000 (76,190,820) 2,623,809,180
Opening balance as at 01 January 2014 2,700,000,000 (76,190,820) 2,623,809,180
Total comprehensive income for the year - 40,003,502 40,003,502
Balance as at 31 December 2014 2,700,000,000 (36,187,318) 2,663,812,682

Notes to the Financial Statements
as at and for the year ended 31 December 2014
1.0 Status of the company
ISLAMI BANK SECURITIES LIMITED was incorporated on the March 22, 2010 under the Companies Act, 1994 as a public limited
company. It is a subsidiary company of Islami Bank Bangladesh Limited (IBBL) that holds all the shares of the company except
54 (fifty four) shares being held by six individual shareholders. The registered office of the company is situated at 20, Dilkusha
C/A, in Dhaka, Bangladesh.
1.1 Nature of business
The main objective of the company is to carry on the business of a stock broker and stock dealer that is to buy, sell and deal
in shares, stocks, debenture, bonds and other securities, as well as to carry on any business as permissible for a broker and
dealer duly licensed by the Bangladesh Securities and Exchange Commission (BSEC).
2.0 Significant accounting policies and basis of preparation of financial statements
2.1 Statement of compliance
The financial statements have been prepared and presented in accordance with
a) Bangladesh Financial Reporting Standards (BFRS)
b) The Companies act, 1994
c) Securities and Exchange Commission (Stock-Dealer, Stock Broker and Authorized Representative) Rules, 2000
d) Other relevant laws and regulations applicable in Bangladesh
2.2 Basis of preparation
The financial statements have been prepared on a going concern basis following accrual basis of accounting except for
statement of cash flows in accordance with the Companies Act 1994, Securities and Exchange Rules 1987, the Listing Rules
of Dhaka and Chittagong Stock Exchanges and Bangladesh Financial Reporting Standards and other applicable laws and
regulations.
2.3 Basis of measurement
The financial statements have been prepared based on historical cost convention basis. The accounting policies, unless
otherwise stated, have been constantly applied by the Company and are consistent with those of the previous year.
2.4 Going concern
The Company has adequate resources to continue in operation for foreseeable future. For this reasons the directors continue
to adopt going concern basis in preparing the financial statements. The current credit facilities and adequate resources of the
Company provide sufficient funds to meet the present requirements of its existing businesses and operations.
2.5 Components of financial statements
The financial statements referred to here comprise:
a. Statement of Financial Position
b. Statement of Comprehensive Income
c. Statement of Cash Flows
d. Statement of Changes in Equity and
e. Notes to the Financial Statements
2.6 Statement of cash flows
Statement of cash flows is prepared in accordance with the Bangladesh Accounting Standard-7 “Statement of Cash Flows”
under indirect method.
2.7 Reporting period
These financial statements cover one calendar year from 1 January 2014 to 31 December 2014.

2.8 Property, plant and equipment
All Property, Plant and Equipment are stated at cost less accumulated depreciation as per BAS-16 “Property, Plant and
Equipment”. The cost of acquisition of an asset comprises its purchase price and any directly attributable cost of bringing the
assets to its working condition for its intended use inclusive of inward freight, duties and non-refundable taxes.
The company recognizes the cost of purchasing new assets or cost of replacing new assets in the carrying amount of an item
of property, plant and equipment when that cost is incurred if it is probable that the future economic benefits embodied with
the item will flow to the company and the cost of the item can be measured reliably. Expenditure incurred after the assets
have been put into operation, such as repair and maintenance is normally charged off as revenue expenditure in the period in
which it is incurred.
2.8.1 Depreciation policy
Depreciation is charged at the following rates on a straight line method on motor vehicles and computers and other assets are
depreciated on reducing balance method according to their respective percentage given below. Depreciation is charged from
the date of acquisition of particular assets and up to the date of disposal.
Items Rate Method
Mechanical appliances 20-25% Reducing balance
Furniture and fixtures 10-20% Reducing balance
Computers 25% Straight line
Motor vehicles 20% Straight line
2.9 Intangible assets and amortization of intangible assets
Intangible assets acquired separately are measured on initial recognition at cost and are carried at cost less accumulated
amortization and accumulated impairment losses, if any. Amortization is calculated using the straight line method to write
down the cost of intangible assets to their residual values over their estimated useful lives based on the management best
estimates. Subsequent expenditure on software assets is capitalized only when it increases the future economic benefits in
the specifications to which it relates. All other expenditure is expensed as incurred.
Software
Acquired software licenses are capitalized on the basis of costs incurred to acquire and bring the specific software to use.
These costs are amortized over their estimated useful lives of four years.
2.10 Investment in TREC (Membership)
Investment in Stock Exchanges for TREC (Membership) are stated at cost. The cost of acquisition of a TREC (Membership)
comprises its purchase price and any directly attributable cost of completing compliance requirements relevant to it inclusive
of stamp duty and non-refundable taxes, etc. As per the Demutualization Act, 2013 Membership renamed as Trading Right
Entitlement Certificate (TREC) and we have been allotted 7,215,106 and 4,287,330 no. of ordinary shares of Dhaka Stock
Exchange Limited (DSE) and Chittagong Stock Exchange Limited (CSE) respectively.
2.11 Preliminary and deferred revenue expenses
All the preliminary and deferred revenue expenses have been recognized as assets and as per Board’s decision all these assets
will be amortized over the period of 5 (five) years or at a rate of 20% commencing from the year 2011. All these assets are
stated in financial position at cost less accumulated amortization.
Cash and cash equivalents comprise cash in hand and cash at bank, which are held and available for use by the company
without any restriction and are readily convertible to a known amount of cash and that are subject to an insignificant risk of
change in value.
2.13 Investment in securities
Investment in securities means purchase of shares of quoted/listed companies in DSE and CSE through stock dealer account.
Investment is made in shariah complied securities. Investment in securities is categorized as held for trading as per BAS 39 and
valued at market value on the last date of reporting period and relevant unrealized gain /(loss) is recognized in income statement
as per directive # SEC/CMRRCD/2009-193/166 dated January 12, 2015,as per directive # SEC/CMRRCD/2009-193/154 dated
December 09, 2013 and as per directive # SEC/CMRRCD/2009-193/144 dated 27 February 2013 respectively of Bangladesh
Securities and Exchange Commission.

2.14 Advance, deposits and prepayments
Advances are initially measured at cost. After initial recognition, advances are carried at cost less deductions, adjustments or
charges to other account heads. Deposits are measured at payment value. Prepayments are initially measured at cost. After
initial recognition, prepayments are carried at cost less charges to income statement.
2.15 Advance income tax
The amount of advance income tax are (a) Payment made through challan under section 64 and (b) Tax deduction at source
(TDS). TDS mainly deduction of tax at sources (i) By bank on profits arisen from bank deposits (SND and MTDR) (ii) By Dhaka
Stock Exchange Limited and Chittagong Stock Exchange Limited on trading turnover and (iii) against dividend income received
from securities owned by the company under portfolio investment.
2.16 Deferred taxation
Deferred tax liabilities are the amount of income taxes payable in future periods in respect of taxable temporary differences.
Deferred tax assets are the amount of income taxes recoverable in future periods in respect of deductible temporary
differences. Deferred tax assets and liabilities are recognized for the future tax consequences of timing differences arising
between the carrying values of assets, liabilities, income and expenditure and their respective tax bases. Deferred tax assets
and liabilities are measured using tax rates and tax laws that have been enacted or substantially enacted at the reporting date.
The impact on the account of changes in the deferred tax assets and liabilities have also been recognized in the statement of
comprehensive income as per BAS-12 “Income Taxes”.
2.17 Provision for income tax
Provision for current income tax has been made in compliance with relevant provisions of income tax law.
2.18 Share Capital
Ordinary shares are classified as equity when there is no contractual obligation to transfer cash or other financial assets.
2.19 Investment from IBBL
Investment has taken from its parent company ,Islami Bank Bangladesh Limited under mudaraba mode for investment in
stocks, investment in placement share and investment in margin account etc.
2.20 Revenue recognition
Revenue is recognized only when it is probable that the economic benefits associated with the transaction will flow to the
company in accordance with the Bangladesh Accounting Standard (BAS) 18 “Revenue Recognition”:
2.21 Dividend income
All dividends received or receivable against the investment in securities held both under dealer account and Musharaka
Investment have been considered as dividend income in statement of comprehensive income. Dividend income is recognized
on accrual basis.
2.22 Capital gains from direct investment
The difference between cost price and net sales price of the securities is considered as capital gain from direct investment.
2.22.1 Musharaka investment and income
Musharaka investment means the margins (Investment facilities) provided to eligible clients under brokerage operation in
Musharaka principle/ mode of finance. As per Musharaka principle, profits arisen through capital gain and dividend from this
investment are shared between company and client as per agreed ratio and loss is shared as per equity participation ratio.
Investment is valued at market value on the last date of reporting period and relevant unrealized gain (Loss) is recognized
in income statements as per directive # SEC/CMRRCD/2009-193/166 dated January 12, 2015, as per directive # SEC/
CMRRCD/2009-193/154 dated December 09, 2013 and as per directive # SEC/CMRRCD/2009-193/144 dated 27 February
2013 respectively of Bangladesh Securities and Exchange Commission.
2.23 Brokerage commission
Brokerage commission is recognized as income when selling or buying order executed.
2.24 Provisions
All provision is recognized on the financial statement date if, as a result of past events, the company has a present legal or
constructive obligation that can be estimated reliably, and it is probable that an outflow of economic benefits will be required
to settle the obligation.

2.25 Event after the reporting period
As per BAS - 10 “Events after the Reporting period”, events after the reporting period are those events, favorable and
unfavorable, that occur between the end of the reporting period and the date when the financial statements are authorized for
issue. Two types of events can be identified:
i) those that provide evidence of conditions that existed at the end of the reporting period (Adjusting events after the reporting
period) and
ii) those that are indicative of conditions that arose after the reporting period (Non- adjusting events after the reporting
period).
There was no material events which have occurred after the reporting period which could affect the values stated in the
financial statements.
2.26 Related party transaction
As per BAS 24 “Related Party Disclosures”, a related party is a person or entity that is related to the entity (i.e. IBSL) that is
preparing its financial statements. Related party transaction is a transfer of resources, services, or obligations between a
reporting entity and a related party, regardless of whether a price is charged as per BAS 24.
Related Parties include the Company’s Directors, key management personnel, associates, companies under common
directorship etc. as per BAS 24 “Related Party Disclosures”. All transactions involving related parties arising in the normal
course of business are conducted as arm’s length transactions. Details are given in Note.38
2.27 Authorization of the financial statements for issue
The financial statements of the company have been authorized for issue by the Board of Directors on 09 March 2015.
2.28 General
a)The financial statements are presented in Bangladeshi Taka (BDT) currency, which is the company’s functional currency.
b) The figures appearing in these financial statements are expressed in Taka currency and rounded off to the nearest Taka
unless otherwise stated.
c) Previous year’s figures have been rearranged, where necessary, to conform to current year’s presentation.

Amount in Taka
31.12.2014 31.12.2013
3 Property, plant and equipment
Cost
Opening balance at cost 12,599,370 12,439,341
Add: Assets purchased during the year 813,467 160,029
Less: Sale/Adjustment during the year - -
Closing value at cost (a) 13,412,837 12,599,370
Accumulated depreciation
Opening balance 7,273,346 4,920,962
Add: Depreciation charged during the year 33 2,382,016 2,352,384
Less: Adjustment during the year - -
Closing balance of depreciation (b) 9,655,362 7,273,346
Written down value (a - b) 3,757,475 5,326,024
Details are given in Annexure -A
4 Intangible assets
Cost
Add: Assets purchased during the year 19,855 72,000
Less: Sale/Adjustment during the year - -
Closing value at cost (a) 1,541,763 1,521,908
Accumulated amortization
Opening balance 797,838 431,169
Add: Amortized during the year 34 383,727 366,669
Less: Adjustment during the year - -
Closing balance of Amortization (b) 1,181,565 797,838
Written down value (a - b) 360,198 724,070
Details are given in Annexure -B
5 Investment in TREC (Membership)
DSE 24,453,399 24,453,399
CSE 280,000,000 280,000,000
304,453,399 304,453,399
This represents the acquisition cost of DSE and CSE memberships paid by Islami Bank Securities Limited. According to Exchanges
Demutualization Act 2013 and Bangladesh Securities and Exchange Commission (BSEC) approved Demutualization Scheme, Dhaka
Stock Exchange Ltd. (DSE) has allotted total 7,215,105 ordinary Shares at a face value of Taka 10.00 each against acquisition cost of
Taka 24,453,399 while Chittagong Stock Exchange Ltd. (CSE) allotted total 4,287,330 ordinary shares at face value of Taka 10.00 each
against acquisition cost of Taka 280,000,000. Out of the shares allotted DSE has transferred 2,886,042 shares and CSE transferred
1,714,932 shares to BO account of the company. The remaining balance has been kept under blocked account. Since there is no active
market for shares of DSE and CSE and the fair value of the said investments could not be reliably measured.
6 Preliminary expenses
Total value at cost as on 31 December 540,125 540,125
Less: Accumulated amortization as on 31 December (432,100) (324,075)
108,025 216,050

Amount in Taka
31.12.2014 31.12.2013
7 Deferred revenue expenses
Total value at cost as on 31 December 2,441,852 2,441,852
Less: Accumulated amortization as on 31 December (1,953,481) (1,465,111)
488,371 976,741
8 Deferred tax assets
Accounting base of fixed assets 3,626,565
Tax base of fixed assets 4,529,081 -
Deductable temporary difference (DTD) 902,515 -
Deferred tax assets ( 35% of DTD) 315,880 -
9 Cash and cash equivalents
Cash in hand 19 4,660
Cash at bank 9.1 346,324,439 193,812,203
346,324,458 193,816,863
9.1 Cash at bank
i) IBSL account 281,966,263 36,585,767
ii) Customer account 64,358,176 157,226,436
346,324,439 193,812,203
10 Investment in securities
Own portfolio 10.1 1,483,281,601 1,551,780,685
Musharaka portfolio 10.2 33,075,657 31,259,575
1,516,357,258 1,583,040,260
10.1 Own portfolio
Opening balance at cost 1,913,693,110 1,533,852,541
Add: Shares purchased during the year 1,138,029,475 1,216,709,179
Less: Cost of shares sold during the year (1,175,692,383) (836,868,610)
Closing balance of investment at cost 1,876,030,202 1,913,693,110
Less: Provision against un-realized gain/(loss) (Note: 10.1.1) (392,748,601) (361,912,425)
1,483,281,601 1,551,780,685
10.1.1 Provision against unrealized gain/(loss)
Opening balance (361,912,425) (318,233,374)
Add: Addition during the year (Note:37.1) (30,836,176) (43,679,051)
Closing balance (392,748,601) (361,912,425)
10.2 Musharaka portfolio
Add: Shares purchased/(sold) during the year 4,089,384 2,927,523
Closing balance of investment at cost 38,687,354 34,597,970
Less: Provision against un-realized gain/(loss) (Note: 10.2.1) (5,611,697) (3,338,395)
33,075,657 31,259,575

Amount in Taka
31.12.2014 31.12.2013
10.2.1 Provision against unrealized gain/(loss)
Opening balance (3,338,395) (1,813,325)
Add: Addition during the year (Note: 37.2) (2,273,302) (1,525,070)
Closing balance (5,611,697) (3,338,395)
11 Accounts receivables
Receivable from clients 1,199,325 1,000,440
Receivable from CSE (Dealer) 16,986 412,435
Receivable from DSE (Broker) 487,449 6,391,272
Receivable from DSE (Dealer) 3,742,870 586,200
5,446,630 8,390,347
12 Advances, deposits and prepayments
Advance office rent for head office 12.1 5,467,000 8,449,000
Prepaid insurance premium 12.2 36,645 36,645
Prepaid motor car maintenance 12.3 35,174 35,500
Advance income tax 12.4 48,485,703 15,130,578
54,024,522 23,651,723
12.1 Advance office rent for head office
Opening balance 8,449,000 1,242,500
Add: paid during the year - 8,946,000
Less: Charged to profit & loss during the year 2,982,000 1,739,500
5,467,000 8,449,000
12.2 Prepaid insurance premium
Add: paid during the year 43,973 43,973
Less: Charged to profit & loss during the year 43,973 51,124
36,645 36,645
12.3 Prepaid motor car maintenance
Add: paid during the year 35,174 35,500
Less: Charged to profit & loss during the year 35,500 42,000
35,174 35,500
12.4 Advance income tax
Opening balance 15,130,578 17,870,970
Add: Income tax paid during the year 12.4.1 33,355,125 15,130,578
Less: Adjustment against tax assessment - (17,870,970)
48,485,703 15,130,578
12.4.1 Income tax paid during the year
Advance income tax 20,914,690 5,047,252
Tax deduction at source (TDS) 12.4.2 12,440,435 10,083,326
33,355,125 15,130,578

Amount in Taka
31.12.2014 31.12.2013
12.4.2 Tax deduction at source (TDS)
TDS against dividend income 4,879,430 1,871,460
TDS from bank account profit 6,162,135 7,245,536
TDS on brokerage commission by CSE 7,247 9,047
TDS on brokerage commission by DSE 1,391,623 957,283
12,440,435 10,083,326
13 Investment in MTDR
Opening balance 889,006,145 821,329,479
Add: New/reinvestment during the year 2,747,146,682 67,676,666
Less: Encashment during the year - -
3,636,152,827 889,006,145
14 Other asset
Stock in hand 44,650 -
Dividend receivable 748,020 1,205,000
Receivable profit from bank on MTDR 11,218,112 15,075,838
12,010,782 16,280,838
15 Share capital
Authorized capital
5,000,000 ordinary shares of Taka 1,000 each. 5,000,000,000 5,000,000,000
Paid- up capital
27,00,000 ordinary shares of Taka 1,000 only each:
Name of shareholder No. of shares % Amount in Taka

1) IBBL (Represented by four directors) 2,699,946 99.998 2,699,946,000 2,699,946,000
2) Janab Mohd. Shamsul Haque 9 0.0003 9,000 9,000
3) Janab Md. Kabir Hossain 9 0.0003 9,000 9,000
4) Janab Md. Nurul Islam 9 0.0003 9,000 9,000
5) Janab Muhammad Abul Bashar 9 0.0003 9,000 9,000
6) Janab Md. Abdul Jabbar 9 0.0003 9,000 9,000
7) Janab Md. Obaidul Haque 9 0.0003 9,000 9,000
2,700,000 100.00 2,700,000,000 2,700,000,000
16 Deferred tax liability
Accounting base of fixed assets - 5,399,233
Tax base of fixed assets - 5,251,838
Taxable temporary difference (TTD) - 147,395
Deferred tax liabilities( 35% of TTD) - 55,273
17 Investment from IBBL
Opening balance - 50,382,297
Add: Investment received during the year 3,000,000,000 -
Less: Repayment/adjustment investment - (50,382,297)
3,000,000,000 -
Investment has taken from Islami Bank Bangladesh Limited under mudaraba mode. These amount has been invested in MTDR
amounting to Taka 275 crore. The profit sharing ratio between IBBL and IBSL is to be at 50:50 basis.

Amount in Taka
31.12.2014 31.12.2013
18 Accounts payables
Payable to clients 51,872,809 160,416,135
Payable to clients (IPO) 7,017,000 -
Payable to CSE (Dealer) - 744,082
Payable to DSE (Broker) 1,631,549 56,254
Payable to DSE (Dealer) 637,481 438
61,158,839 161,216,909
19 Provision for income tax
Opening balance 37,356,636 36,827,715
Add: Provision for income tax for the year 25,368,838 33,362,272
Less: Adjustment against assessment (1,060,841) (32,833,351)
Tax deduction at source (TDS) - (12,870,970)
Advance income tax (Under sec. 64 of ITO) - (5,000,000)
Payment for tax during the year (1,060,841) (14,962,381)
61,664,633 37,356,636
20 Accrued expenses
Ex gratia bonus 1,200,550 1,080,240
Auditor’s fees 92,000 75,000
CDS charges 106,760 86,213
Electricity bills 13,424 8,601
Holiday allowance 5,400 9,050
Legal fees 85,000 85,000
Network expenses 28,050 28,050
Office maintenance 6,048 2,900
Office rents 67,689 169,222
Professional and consultancy fees 40,250 35,000
Service charges 17,250 17,250
Software annual maintenance fees - 15,000
Telephone bills 24,737 30,781
Wages 12,030 24,072
Water bills 6,000 6,000
1,705,188 1,672,379
21 Quard against MTDR
Opening balance 200,000,000 -
Add: Addition during the year 210,000,000 200,000,000
Less: Payment during the year 320,000,000 -
90,000,000 200,000,000
22 Other current liabilities
Security deposit from clients 1,111,279 1,111,279
Security deposits payable on fixed assets 22.1 16,920 289,318
Sundry creditors 25,757 23,190
TDS payable 240,608 347,900
VAT payable 32,769 396
Bank charge payable 31,150 -
1,458,483 1,772,083

Amount in Taka
31.12.2014 31.12.2013
22.1 Security deposits payable on fixed assets
Computer Source - 145,500
Digilog System 5,550 5,550
Gazi Communication - 33,180
Leads Corporation - 66,000
Net Com 11,370 39,088
16,920 289,318
Amount in Taka
23 Investment income 2014 2013
Cash dividend from own investment 28,602,873 8,485,700
Cash dividend from Musharaka investment 274,448 68,592
Profit from bank on SND 1,979,416 7,039,230
Profit from MTDR 57,286,496 74,316,509
Capital gains from direct investment 23.1 23,112,885 55,960,241
111,256,118 145,870,272
23.1 Capital gains from direct investment
Capital gains from sale of securities 23.1.1 22,305,654 55,257,974
Capital gain from Musharaka investment 23.1.2 807,231 702,267
23,112,885 55,960,241
23.1.1 Capital gains from sale of securities
Capital gains 68,499,785 55,257,974
Less: Capital loss 46,194,131 -
22,305,654 55,257,974
23.1.2 Capital gain from musharaka investment
Capital gains 868,407 732,637
Less: Capital loss 61,176 30,370
807,231 702,267
24 Brokerage commissions
Commission on CSE turnover 66,861 89,187
Commission on DSE turnover 12,891,911 9,443,380
12,958,772 9,532,567
25 Other operating income
BO account opening fees 317,100 318,300
BO accounts maintenance fees 1,960,477 1,604,715
Commission from IPO 8,248 -
Documentation fee (Margin account) 3,100 3,100
Miscellaneous income 39,388 14,464
2,328,313 1,940,579

Amount in Taka
2014 2013
26 Salary and allowances
Salary 11,705,941 10,690,679
Eid bonus 1,142,510 1,001,455
Ex gratia bonus 1,200,550 2,026,680
Holiday allowance 173,100 74,100
Wages 146,172 109,072
14,368,273 13,901,986
27 Rents, taxes, insurance and electricity
Office rents 3,656,514 2,302,189
Renewal of tax token for motor vehicles 14,900 12,714
Insurance premiums 43,973 51,124
Electricity bills 190,326 125,363
3,905,713 2,491,390
28 Brokerage expenses
CSE Howla charges 884 1,120
CSE Laga charges 2,560 3,167
DSE Howla charges 140,392 109,554
DSE Laga charges 561,548 382,914
Investors’ protection fund charges 3,319 2,018
708,703 498,773
29 Postage, stamps and communications
Conveyances 23,245 11,553
Postage 3,517 22,110
Stamps 9,754 10,615
Telephone bills 162,153 160,504
198,669 204,782
30 Stationery, printing and advertisements
Stationeries expenses 120,413 102,487
Printing expenses 58,088 3,036
Advertisements 24,000 46,000
202,501 151,523
31 Directors’ fees and expenses
Directors’ fees 345,000 250,000
Add: Value added tax (VAT) 51,750 37,500
396,750 287,500
32 Repair and maintenances
Motor car running and maintenances 589,622 456,230
Network support 336,600 301,761
Office maintenances 64,435 99,439
Other repair and maintenances 56,936 21,120
Software annual maintenance fees 95,000 80,000
1,142,593 958,550

Amount in Taka
2014 2013
33 Depreciation
Mechanical Appliances 220,270 242,359
Computer 830,904 767,802
Furniture & fixture 191,070 219,023
Motor vehicles 1,139,772 1,123,200
2,382,016 2,352,384
34 Amortization
Preliminary expense 108,025 108,025
Deferred revenue expenses 488,370 488,370
Intangible assets 383,727 366,669
980,122 963,064
35 License expenses
Renewal fees for depository participant (DP) 4,000 4,000
Renewal fees for DSE (Broker and dealer) 20,000 20,000
Renewal fee for TREC 50,000 -
Renewal fees for CSE (Broker and Dealer) 20,000 20,000
Authorized representative expenses 48,500 3,000
Renewal of trade license fees 17,500 13,600
160,000 60,600
36 Other expenses
Annual subscription fees 4,700 9,700
Bank charges 120,529 84,122
Computer accessories 173,360 179,650
Electronic expenses 54,672 25,740
Entertainments 314,311 191,908
Internet bills 99,841 72,448
Govt. fee 3,199 19,436
Reimbursement expenses 31,801 46,132
Miscellaneous expenses 32,377 18,792
Newspaper, magazine and periodicals 23,108 15,684
Professional and consultancy fees 103,638 80,225
Service charges 207,000 197,500
Software expenses 10,000 17,090
Subsidy of BO accounts maintenance exp. 4,290 -
Training program expenses 97,300 8,000
Water bills 82,100 49,345
1,362,226 1,015,772
37 Provision against unrealized gain/(loss)
Own portfolio during the year 37.1 (30,836,176) (43,679,051)
Musharaka portfolio during the year 37.2 (2,273,302) (1,525,070)
(33,109,478) (45,204,121)

Amount in Taka
2014 2013
37.1 Own portfolio during the year
a) Investment in securities at market price as on 31 December 1,359,936,897 1,406,035,940
b) Investment in securities at cost price as on 31 December 1,876,030,202 1,913,693,110
c) Total unrealized gain/(loss) as on 31 December (a-b) 37.1.1 (516,093,305) (507,657,170)
d) Opening balance of provision (361,912,425) (318,233,374)
e) Provision required to be provided (c-d) (154,180,880) (189,423,796)
f) Less: Provision yet to be provided carry forward in next year* (123,344,704) (145,744,745)
g) Provision for the year (e-f) (30,836,176) (43,679,051)
As per directive # SEC/CMRRCD/2009-193/166 dated January 12, 2015 of Bangladesh Securities and Exchange Commission, it is
required to maintain at least 20% provision against unrealized loss .IBSL has made 76% provision against unrealized loss arising to
till date (31.12.14) revaluation of share purchase through own portfolio. However, the directives prohibit payments of cash dividend if
the company makes less than 100% provision against such unrealized loss.
37.1.1 Unrealized gain/(loss)
Opening balance (507,657,170) (434,858,752)
Add: Addition during the year (8,436,135) (72,798,418)
Closing balance (516,093,305) (507,657,170)

37.2 Musharaka portfolio during the year
a) Investment in securities at market price as on 31 December 23,982,447 22,989,562
b) Investment in securities at cost price as on 31 December 38,687,354 34,597,970
c) Total unrealized gain/(loss) as on 31 December (a-b) 37.2.1 (14,704,907) (11,608,408)
d) Opening balance of provision (3,338,395) (1,813,325)
e) Provision yet to be provided (c-d) (11,366,512) (9,795,083)
f) Less: Provision yet to be provided carry forward in next year* (9,093,210) (8,270,013)
g) Provision for the year (e-f) (2,273,302) (1,525,070)
As per directive # SEC/CMRRCD/2009-193/166 dated January 12, 2015 of Bangladesh Securities and Exchange Commission, it is
required to maintain at least 20% provision against unrealized loss.IBSL has made 38% provision against unrealized loss arising to
till date (31.12.14) revaluation of share purchase through musharaka portfolio. However, the directives prohibit payments of cash
dividend if the company makes less than 100% provision against such unrealized loss.
37.2.1 Unrealized gain/(loss)
Opening balance (11,608,408) (9,066,625)

Add: Addition during the year (3,096,499) (2,541,783)
Closing balance (14,704,907) (11,608,408)

38 Nature and type of related party transaction of the company
38.1 Nature and type of related party transaction disclosure of the company Amount in Taka
Name of related party Relationship Nature of transaction 2014
Islami Bank Bangladesh Limited (IBBL) Parent- Deposit to MSA 3,630,708,197
subsidiary Withdraw from MSA 3,630,323,619
Deposit to AWCA 621,004,225
Withdraw from AWCA 692,190,267
Bank Charge paid 3,829
Payment against office rent 406,134
Tax deduction at source
against MTDR 5,962,541
Profit withdraw against MTDR 57,950,000
Payment against Quard
during the year 320,000,000
Quard availed during the year 210,000,000
38.2 Nature and type of balance of related party transaction of the company
Amount in Taka
Name of related party Relationship Nature of transaction
2014
Islami Bank Bangladesh Limited (IBBL) Parent- Bank balance 41,082,194
subsidiary MTDR balance 886,152,827
Quard balance 90,000,000
Receivable profit on MTDR 11,218,112
Investment received under
Mudaraba Mode 3,000,000,000
Profit against MTDR 57,286,496
Profit against SND A/C. 5,297
Accounts payable 7,023,067
Office rent payable 67,689
Directors Board Member Board Meeting participation fees 396,750
Chief Executive Officer key management Short-term employee benefits 1,887,852

Annexure -A

Schedule of Property, Plant & Equipment
Amount in Taka
Cost Depreciation
W.D.V.
Particulars
Balance as at Addition Balance as at Balance as at Charged during the Adjustment Balance as at as at
Adjustment 31.12.2014
01.01.2014 31.12.2014 01.01.2014 year 31.12.2014
Mechanical Appliances 1,642,976 197,669 - 1,840,645 777,048 220,270 - 997,318 843,327

Computer 3,144,635 400,735 - 3,545,370 2,213,277 830,904 - 3,044,181 501,189
Furniture & fixture 2,195,759 35,044 - 2,230,803 784,587 191,070 - 975,657 1,255,146
Motor vehicles 5,616,000 180,019 - 5,796,019 3,498,434 1,139,772 - 4,638,206 1,157,813
Total assets 12,599,370 813,467 - 13,412,837 7,273,346 2,382,016 - 9,655,362 3,757,475
Amount in Taka
Cost Depreciation
W.D.V.
Particulars
Balance as at Addition Balance as at Balance as at Charged during the Adjustment Balance as at as at
Adjustment 31.12.2013
01.01.2013 31.12.2013 01.01.2013 year 31.12.2013
Mechanical Appliances 1,612,976 30,000 - 1,642,976 534,689 242,359 - 777,048 865,928

Computer 3,053,135 91,500 - 3,144,635 1,445,475 767,802 - 2,213,277 931,358
Furniture & fixture 2,157,230 38,529 - 2,195,759 565,564 219,023 - 784,587 1,411,172
Motor vehicles 5,616,000 - - 5,616,000 2,375,234 1,123,200 - 3,498,434 2,117,566
Total assets 12,439,341 160,029 - 12,599,370 4,920,962 2,352,384 - 7,273,346 5,326,024
Annual Report 2014

275
Annexure - B
276
Schedule of Intangible Assets
Amount in Taka
Cost Depreciation W.D.V.
Particulars as at
Balance as at Addition Adjustment Balance as at Balance as at Charged during Adjustment Balance as at 31.12.2014
01.01.2014 31.12.2014 01.01.2014 the year 31.12.2014
Annual Report 2014

Software 1,521,908 19,855 - 1,541,763 797,838 383,727 - 1,181,565 360,198
Total assets 1,521,908 19,855 - 1,541,763 797,838 383,727 - 1,181,565 360,198
Amount in Taka
Cost Depreciation
Charged W.D.V.
Particulars Balance as at Balance as at as at
Addition Balance as at during the Adjustment Balance as at
01.01.2013 Adjustment 01.01.2013 31.12.2013
31.12.2013 year 31.12.2013
Software 1,449,908 72,000 - 1,521,908 431,169 366,669 797,838 724,070

Total assets 1,449,908 72,000 - 1,521,908 431,169 366,669 - 797,838 724,070
Islami Bank Capital Management Limited
• Report of the Directors

• Auditors’ Report
• Audited Financial Statements

Report of the Directors
The Directors is pleased to submit their report and audited financial statements for the year ended 31 December 2014 as follows:
Status of the company
Islami Bank Capital Management Limited was incorporated on the 01 April 2010 under the Companies Act, 1994 as a public limited company.
It is a subsidiary company of Islami Bank Bangladesh Limited that hold all the shares of the company except 07 (Seven) shares being held by
7 (Seven) individual shareholders. The registered office of the company is situated at 20, Dilkusha C/A, Dhaka, Bangladesh.
Principal activities
Islami Bank Capital Management Ltd is yet to start up its operations. The objectives of the company is to carry on Merchant Banking
Operations in all its aspects including underwriting and/or management of issue, public offer of shares, stocks, debentures, bonds, etc.;
sale or purchase of securities or transfer thereof; fund management for clients, underwriting of shares, stocks, debentures, bonds, etc.;
managing portfolio investments of any person or company, by investment in various avenues, etc.
Financial performance
The Company has earned Tk.33,352,300 as Net Profit After Tax (NPAT) in the year 2014 as against Tk.28,235,597 of previous year. Since
the Company has not yet started its operation hence the income was generated mainly by investing the available fund in different deposit
schemes with Scheduled Islamic Banks.
Dividend
The Board has recommended 35% cash interim dividend i.e. Tk.350 per share amounting to Tk.105,000,000 as final dividend for the year
ended 31 December 2014.
Directors
The overall control and management of affairs of Islami Bank Capital Management Limited vests in its Board of Directors. To comply
with the requirements of Bangladesh Securities and Exchnage Commission (BSEC), Companies Act 1994, Merchant Banker and Portfolio
Manager Rules 1996 as amended and Memorandum of Association (MoA) of the Company Mr. Barrister Mohammed Belayet Hossain, one of
the independent directors of Islami Bank Bangladesh Limited has been proposed to be appointed in the Board of the company and 1 (one)
new director namely Mr. Nurul Islam Khalifa has been proposed to be elected as Director of the Company in the 5th Annual General Meeting
of the Company to be held in 24 January 2015 at 11:00 AM in the Board Room of the Islami Bank Bangladesh Limited at 40 Dilkusha C/A,
Dhaka-1000.
Auditor
Hussain Farhad & Co. Chartered Accountants have offered their willingness to be re-appointed and hence the Board recommends their re-
appointment for the year 2015 and to continue till the next Annual General Meeting of the Company.
Key Management Personnel
The affairs of the Company mainly co-ordinated by the Director Mr. Abdus Sadeque Bhuiyan and recently there were some changes made
in the other Key Management Personnel of the Company. New Chief Executive Officer (CEO) namely Mr. Md. Nasir Uddin ACA and Chief
Financial Officer (CFO) namely Mr. Md. Mainudden Khondaker was appointed by the Board of the Company.
Material changes and commitments
There were no other material changes and commitments during the year that may affect financial position of the Company which have
occurred between the end of the financial year of the Company to which the balance sheet related and the date of the report.
On Behalf of the Board
Engr. Mustafa Anwar

Chairman (C.C.)

Auditors’ Report
To the shareholders of Islami Bank Capital Management Limited
Introduction
We have audited the accompanying financial statements of Islami Bank Capital Management Limited “(the Company)” which comprise
the Statement of Financial Position as at 31 December 2014, the Statement of Comprehensive Income, Statement of Changes in Equity,
Statement of Cash Flows for the year then ended, a summary of significant accounting policies and other explanatory information.
Management’s Responsibility for the Financial Statements
Management is responsible for the preparation of financial statements that give a true and fair view in accordance with Bangladesh Financial
Reporting Standards (BFRS) and for such internal control as management determines is necessary to enable the preparation of financial
statements that are free from material misstatement, whether due to fraud or error.
Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with
Bangladesh Standards on Auditing(BAS). Those standards require that we comply with ethical requirements and plan and perform the audit
to obtain reasonable assurance about whether the financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The
procedures selected depend on our judgment, including the assessment of the risks of material misstatement of the financial statements,
whether due to fraud or error. In making those risk assessments, we consider internal control relevant to the entity’s preparation of financial
statements that give a true and fair view in order to design audit procedures that are appropriate in the circumstances, but not for the
purpose of expressing an opinion on the effectiveness of the entity’s internal control. An audit also includes evaluating the appropriateness
of accounting policies used and the reasonableness of accounting estimates made by management, as well as evaluating the overall
presentation of the financial statements.
Opinion
In our opinion, the financial statements, give a true and fair view of the financial position of Islami Bank Capital Management Limited as
at 31 December 2014 and of their financial performance and cash flows for the year then ended in accordance with Bangladesh Financial
Reporting Standards (BFRS) and comply with the applicable sections of the Companies Act, 1994 and other applicable laws and regulations.
We further report that:
i) 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 and made due verification thereof;
ii) in our opinion, proper books of account as required by law have been kept by the Company so far as it appeared from our examination
of those books;
iii) the statement of financial position dealt with by the report are in agreement with the books of account;
iv) the expenditure incurred was for the purpose of company’s business.
Place: Dhaka
Date: January 07, 2015 Hussain Farhad & Co

31.12.2014 31.12.2013
Particulars Note
Taka Taka
ASSETS:
Non-current assets - 537,485
Preliminary expenses 3 - 537,485
Current assets 463,795,405 426,715,977

Advance income tax 4 40,758,025 38,347,187
Prepaid rent 5 - -
Accrued income 10.2 9,966,581 -
Cash & cash equivalents 6 413,070,799 388,368,790
Total assets 463,795,405 427,253,462
SHAREHOLDERS’ EQUITY & LIABILITIES:
Shareholders equity 307,871,339 379,519,039

Share capital 7 300,000,000 300,000,000
Retained earnings 7,871,339 79,519,039
Current liabilities 155,924,066 47,734,423

Accrued expenses 8 23,000 23,000
Dividend payable 13 105,000,000 -
Provision for income tax 9 50,901,066 47,711,423
Total shareholders’ equity & liabilities 463,795,405 427,253,462
The annexed notes 1 to 13 form an integral part of these financial statements.
Director Director Chairman

Signed as per our annexed report of even date
Place: Dhaka Hussain Farhad & Co

Date: January 07, 2015 Chartered Accountants

Statement of Comprehensive Income
2014 2013
Particulars Notes
Taka Taka
Operating income 10 52,663,859 45,790,331
Less : Operating expenses 702,131 613,376
Audit fees 23,000 23,000

Bank charge 11 2,270 2,710
Conveyance 70 401
Entertainment expenses 5,556 -
Excise duty 10,000 25,000
LTU charge 2,500 3,000
Office rent 12 - 499,765
Professional fees 119,250 34,500
Amortization of preliminary expenses 537,485 24,000
Tribunal fees 2,000 1,000
Profit/(loss) before tax 51,961,728 45,176,955
Less : Provision for income tax 18,609,428 16,941,358
Net profit/(loss) after tax 33,352,300 28,235,597
Director Director Chairman
Signed as per our annexed report of even date
Place: Dhaka Hussain Farhad & Co

Date: January 07, 2015 Chartered Accountants

Amount in Taka
Particulars Share capital Retained earnings Total
Balance as at 01 January 2013 300,000,000 51,283,442 351,283,442

Changes in equity during the year:
Issue of share capital - - -
Net profit/(loss) after tax - 28,235,597 28,235,597
Dividend - - -
Balance as at 31 December 2013 300,000,000 79,519,039 379,519,039
Balance as at 01 January 2014 300,000,000 79,519,039 379,519,039

Changes in equity during the year:
Issue of share capital - - -
Net profit/(loss) after tax - 33,352,300 33,352,300
Dividend (Note - 13) - 105,000,000 105,000,000
Balance as at 31 December 2014 300,000,000 7,871,339 307,871,339

Statement of Cash Flows
2014 2013
Particulars
Taka Taka
Profit/(loss) before tax 51,961,728 45,176,955

Adjustment: - -
Amortization of preliminary expenses 537,485 -
Adjusted operating profit before changes in working capital 52,499,213 45,176,955
Changes in working capital: (9,966,581) 458,422
(Increase)/ decrease in prepaid rent - 458,500

Increase/ (decrease) in accrued income (9,966,581) -
Increase/ (decrease) in accrued expenses/other payables - (78)
Less: Tax paid 17,830,623 16,245,854

Net cash (used in)/ generated from operating activities (A) 24,702,009 29,389,523
Cash flow from investing activities (B) - -
Cash flows from financing activities (C) - -
Net Increase/ (decrease) in cash & cash equivalents (D)=(A+B+C) 24,702,009 29,389,523
Add: Opening cash & cash equivalents (E) 388,368,790 358,979,268
Closing cash & cash equivalents (D+E) 413,070,799 388,368,790

Notes to the Financial Statements
1. Establishment and status of Islami Bank Capital Management Limited
Islami Bank Capital Management Ltd. was incorporated on 01 April, 2010 under the Companies Act, 1994 as a Public Limited
Company. It is a subsidiary company of Islami Bank Bangladesh Limited. Islami Bank Bangladesh Limited holds all the shares of
the company except 7 shares which are held by 7 individuals. The company has been established as per Bangladesh Bank letter #
BRPD (R-1)717/2010-47 dated 7 February 2010. The registered office of the company is situated at Yousuf Chamber, 20 Dilkusha
C/A (6th Floor), Dhaka-1000. The main objectives of the company are to carry on business of Merchant Banking in all its aspects
including Underwriting and/or management of issue, public offer of shares, stocks, debentures, bonds, etc.; sale or purchase of
securities or transfer thereof; fund management for clients, underwriting of shares, stocks, debentures, bonds, etc.; managing
portfolio investments of any person or company, by investment in various avenues, etc. The Company has applied for Registration
Certificate as per rule-4 of Securities and Exchange Commission (Merchant Banker and Portfolio Manager) Rule, 1996. The
certificate of registration has not been issued yet by the Bangladesh Securities Exchange Commission against the application.
2. Significant accounting Policies
2.1 Basis of accounting
The financial statements of the company have been prepared applying accrual basis of accounting under historical cost
convention in accordance with Bangladesh Financial Reporting Standards (BFRS) and other applicable laws and regulations.
2.2 Statement of cash flows
The statement cash flow is prepared using the indirect method as stipulated in Bangladesh Accounting Standard (BAS) 7 “Statement
of Cash Flows”.
Cash and cash equivalents comprise cash in hand, cash at bank and term deposits that are readily convertible to a known amount
of cash and that are subject to an insignificant risk of change in value.
2.4 General
The figures appearing in these Financial Statements have been rounded off to the nearest integer. The financial statements have
been authorized for issue in the 19th Meeting of the Board of Directors held on 7 January 2015.
2.5 Profit on bank deposits
Profit on bank deposits has been recognized as per accrual basis from the year 2014.
31.12.2014 31.12.2013
Taka Taka
3. Preliminary expenses
Less: Amortization/write-off of preliminary expenses 537,485 -
Closing balance - 537,485
4. Advance income tax
Opening balance 38,347,187 22,101,333
Add: Deducted at source during the year 4,265,595 4,563,728
Shahjalal Islami Bank Ltd. 576,665 721,955
EXIM Bank Bangladesh Ltd. 3,128,998 3,295,771
First Security Islami Bank Ltd. 559,932 546,002
Islami Bank Bangladesh Ltd. - -
Add: Paid through challan during the year 13,565,028 11,682,126
Less: Adjusted during the year due to completion of assessment 15,419,785 -
Closing balance 40,758,025 38,347,187

31.12.2014 31.12.2013
Taka Taka
5. Prepaid rent
Opening balance - 458,500
Less: Adjusted during the year - 458,500
Closing balance - -
6. Cash & cash equivalents
Cash in hand 394 4,020
Cash at bank Note - 6.1 413,070,405 388,364,770
413,070,799 388,368,790
6.1 Cash at bank
Shahjalal Islami Bank Ltd. 7,030,337 3,813,310
First Security Islami Bank Ltd. 310,618,438 282,457,459
Islami Bank Bangladesh Ltd. 45,421,630 47,392,241
413,070,405 388,364,770
7. Share capital
Authorized capital
1,000,000 Ordinary shares @ Tk. 1,000 each 1,000,000,000 1,000,000,000
Issued, subscribed and paid up capital
300,000 Ordinary shares @ Tk.1,000 each fully paid up 300,000,000 300,000,000
Details of shareholders are as under:
Name of the shareholders No. of shares Taka Taka
Islamic Bank Bangladesh Limited 299,993 299,993,000 299,993,000

Mr. M. Fariuddin Ahmad 1 1,000 1,000
Mr. Mohammad Abdul Mannan 1 1,000 1,000
Mr. Md. Setaur Rahman 1 1,000 1,000
Mr. Gulam Moula Choudhury 1 1,000 1,000
Mr. A.K.M Malek Chowdhury 1 1,000 1,000
Mr. Nurul Islam Khalifa 1 1,000 1,000
Mr. Abdus Sadeque Bhuiyan 1 1,000 1,000
Total 300,000 300,000,000 300,000,000
8. Accrued expenses
Audit Fees 20,000 20,000
Add: Value Added Tax (VAT) @15% 3,000 3,000
Total 23,000 23,000
9. Provision for income tax
Opening Balance 47,711,423 30,770,065
Add: Provision made during the year 18,609,428 16,941,358
Less: Adjusted during the year due to completion of assessment 15,419,785 -
Closing balance 50,901,066 47,711,423

2014 2013
Taka Taka
10. Operating income
Income received from profit on bank deposits (Note - 10.1) 42,697,278 45,790,331
Accrued profit on bank deposits (Note - 10.2) 9,966,581 -
52,663,859 45,790,331
10.1 Income received from profit on bank deposits
Shahjalal Islami Bank Ltd. 5,766,661 7,219,548
First Security Islami Bank Ltd. 5,599,321 5,460,025
Islami Bank Bangladesh Ltd. 41,320 153,045
42,697,278 45,790,331
10.2 Accrued profit on bank deposits
EXIM Bank Bangladesh Ltd. 6,433,631 -
Shahjalal Islami Bank Ltd. 1,123,206 -
First Security Islami Bank Ltd. 2,409,743 -
9,966,581 -
11. Bank charge
Account maintenance charge of IBSL 1,000 1,500
Account maintenance charge of Bank 1,270 1,210
2,270 2,710
12. Office rent
Rent - 458,500
Add: VAT - 41,265
- 499,765
13. Dividend
The Board of Directors of the Company declared 35% interim dividend in its 18th meeting held in 22 December 2014. And the
Company declared 35% final dividend for the year 2014 in the 19th meeting of the Board of Directors held in 7 January 2015 which
will be approved in next AGM of the Company.

Standard Disclosure Index

Disclosure checklist to the key sections of the Annual Report 2014
Items Ref. Page No.
Corporate Objectives, Values & Structure
• Vision and Mission 6-7
• Overall strategic objectives 8
• Core values and code of conduct / ethical principles 9-10, 40- 41
• Profile of the Company 22, 62-64
• Director’s profiles and their representation on Board of other companies & Organization Chart 28-32 ,24, 23, 34, 208-201, 49-50
Management Report / Commentary and analysis including Director’s Report / Chairman’s

Review/CEO’s Review etc.
• A general review of the performance of the company 14-19, 65-86, 126-129, 153-154
• Description of the performance of the various activities / products / segments of the 65-86, 14-19, 126-135,
company and its group companies during the period under review 153-154, 144
• A brief summary of the Business and other Risks facing the organization and steps taken
87-96, 40, 202-205
to effectively manage such risks
• A general review of the future prospects/outlook 129, 13, 15, 19,91
• Information on how the company contributed to its responsibilities towards the staff
44-45, 116-117, 197-198
(including health & safety)
• Information on company’s contribution to the national exchequer & to the economy 149, 111-125, 147
Sustainability Reporting
• Social responsibility initiatives (CSR) 116-125, 111-115, 149,157-164
• Environment related initiatives 111-115, 116-125, 46, 148
• Environment & Social Obligations 111-115, 46, 148-149
• Integrated Reporting 148-149, 116-125
Appropriateness of Disclosure of Accounting policies and General Disclosures
• Disclosures of adequate accounting policies relevant to assets, liabilities, income and
185-214
expenditure, cash flows, etc. in line with applicable financial reporting standards
• Any Specific accounting policies 186-192
• Impairment of Assets 196
• Changes in accounting policies / Changes in accounting estimates 190
• Accounting policy on subsidiaries 205-207, 186-189
Segment Information
• Comprehensive segment related information bifurcating segment revenue, segment
results and segment capital employed

• Availability of information regarding different segments and units of the entity as well as 144, 200, 247,
non-segmental entities/units 218-219, 101-102
Segment analysis of
• Segment Revenue
• Segment Results
• Turnover
• Operating profit
• Carrying amount of net segment assets
Financial Statements (Including Formats)
• Disclosures of all contingencies and commitments 173, 179, 200
• Comprehensive Related party disclosures 208-211
• Disclosures of remuneration & facilities provided to directors & CEO 41-42, 174, 180, 239

Items Ref. Page No.

• Statement of Financial Position / Balance Sheet and relevant schedules 172-173, 178-179, 212-235, 241-243
• Income Statement / Profit and Loss Account and relevant schedules 174, 180, 235-243, 226-234
• Statement of Changes in Equity / Reserves & Surplus schedule 176-177, 182-183
• Disclosure of type of share capital 232-234, 138, 50-51
• Statement of Cash Flow 175, 181, 242-243
• Consolidated Financial Statement (CFS) 172-177
• Extent of compliance with the core IAS/IFRS or equivalent National Standards 205-207
• Disclosures / contents of notes to accounts 185-243, 251-253, 261-274, 284-286
Information about Corporate Governance
• Board of Directors, Chairman and CEO 33-36, 22-24
• Audit Committee (composition, role, meetings, attendance, etc), Internal Control & Risk Management 24, 37-40, 166-168, 202-205, 208, 87-96
• Ethics And Compliance 40-41, 10, 35
• Remuneration and other Committees of Board 41-42, 24, 34, 239
• Human Capital 42-45, 116-117, 197-198
• Communication To Shareholders & Stakeholders 45, 140-141
- Information available on website 2, 22, 140, www.islamibankbd.com
- Other information 138-141, 147-150, 153-154
• Management Review and Responsibility 46-48, 36
• Disclosure by Board of Directors or Audit Committee on evaluation of quarterly reports 38, 167-168
• Any other investor friendly information 46, 138-141, 147-150, 152-154
Risk Management & Control Environment
• Description of the Risk Management Framework
• Risk Mitigation Methodology 87-96, 105-107, 202-205, 40
• Disclosure of Risk Reporting
Stakeholders Information
• Distribution of shareholding (Number of shares as well as category wise, e.g Promoter group,
138, 232-233, 50
FII etc)
• Shares held by Directors/Executives and relatives of Directors/Executives 50-51
• Redressal of investors complaints 140-141
Graphical/ Pictorial Data
• Earnings per Share
• Net Assets 142-143
• Stock Performance
• Shareholders’ Funds
• Return on Shareholders Fund
Horizontal/Vertical Analysis including following
Operating Performance (Income Statement)
• Total Revenue
• Operating profit
• Profit Before Tax

• Profit after Tax

• EPS
145, 153-154,
Statement of Financial Position (Balance Sheet) 172-174, 178-180
• Shareholders Fund
• Property Plant & Equipment
• Net Current Assets
• Current Liabilities
• Long Term Liabilities

Items Ref. Page No.

Profitability / Dividends / Performance and Liquidity Ratios
• Gross Profit Ratio
• Earning before profit/interest, Depreciation and Tax

• Price earning ratio
146, 152, 154
• Current Ratios

• Return on Capital Employed
• Debt Equity Ratio
Statement of Value Added and Its Distribution
• Government as Taxes
• Shareholders as dividend
• Employees as bonus/remuneration
• Retained by the entity 147-150
• Market share information of the Company’s product/services
• Economic value added
Additional Disclosures
• Human Resource Accounting 44-45
• Any other good additional disclosures (Independence certification Eg GNV /GRI) 45, 47
Specific Areas for Banking Sector
Disclosure of Ratings given by various rating agencies for Instruments issued by /of Bank. For eg.
48, 205, 199
FD, CD, Tier I perpetual Bonds
Details of Advances portfolio Classification wise as per the direction issued by the central bank of
216-220, 101-104, 68-80
the respective countries
Disclosure for Non Performing assets
• Movements in NPA
• Sector-wise breakup of NPA 219-220, 103-104, 80
• Movement of Provisions made against NPA
• Details of accounts restructured as per regulatory guidelines
Maturity Pattern of Key Assets and Liabilities (ALM) 184, 213-231
Classification and valuation of investments as per regulatory guidelines/Accounting Standards 213-220
Business Ratio/Information
• Statutory Liquidity Reserve (Ratio) 212, 94
• Net interest income as a percentage of working funds / Operating cost - Efficiency ratio 154, 142-143
• Return on Average Asset 143, 152, 154
• Cost / Income ratio 146, 154
• Net Asset Value Per Share 152, 154, 242, 142
• Profit per employee 45
• Capital Adequacy ratio 146, 153, 233, 98, 99
• Operating profit as a percentage of working funds 152
• Cash Reserve Ratio / Liquid Asset ratio 212, 94
• Dividend Cover ratio 152
• Gross Non-Performing assets to gross advances/Non-Performing Loans (Assets) to Total Loans (Assets) 152, 153
Details of investment/credit concentration / Sector vise exposures 68-71, 94, 102, 144, 218-219
The break-up of ‘Provisions and contingencies’ included in the Profit and Loss Account 173-174, 179-180, 226-228
Disclosure under regulatory guidelines 232-240, 97-107, 50-58
Details of Non-Statutory investment portfolio 213-215
Disclosure in respect of assets given on operating & finance lease 68, 216-218, 83
Disclosures for derivative investments 194
Bank’s Network: List of Centers or Branches 290-292

Bank’s Network
Zonal Offices 21 Ganakbari Branch 58 Narayanganj Branch*
1 Dhaka Central Zone 22 Gandaria Branch 59 Narsingdi Branch*
2 Dhaka South Zone 23 Gazipur Chowrasta Branch* 60 Naria Branch
3 Dhaka North Zone 24 Gazipur Sadar Branch 61 Nitaiganj Branch
4 Chittagong North Zone 25 Gopalganj Branch 62 Nawabganj Branch
5 Chittagong South Zone 26 Gulshan Branch* 63 Nawabpur Road Branch*
6 Khulna Zone 27 Gulshan Circle1 Branch* 64 Netrakona Branch
7 Bogra Zone 28 Haji Camp Branch 65 New Market Branch*
8 Sylhet Zone 29 Head Office Complex Branch* 66 Palash Branch
9 Comilla Zone 30 IDB Bhaban Branch 67 Pallabi Branch.
10 Barisal Zone 31 Islampur Branch* 68 Paltan Branch*
11 Rajshahi Zone 32 Jamalpur Branch 69 Panthapath Branch
12 Mymensingh Zone 33 Jatrabari Branch 70 Rajbari Branch
13 Noakhali Zone 34 Kanchpur Branch 71 Ramna Branch*
14 Rangpur Zone 35 Kapasia Branch 72 Rampura Branch*
List of Branches 36 Kawran Bazar Branch* 73 Sadarghat Branch*
Dhaka Division 37 Khilgaon Branch 74 Savar Branch
1 Amin Bazar Branch 38 Kishoreganj Branch 75 Shariatpur Branch
2 Araihazar Branch. 39 Konabari Branch. 76 Sherpur Branch
3 Badda Branch 40 Kotiadi Branch 77 Shyamoli Branch*
4 Bangshal Branch* 41 Lalbag Branch 78 Shyampur Branch
5 Baridhara Branch* 42 Local Office * 79 Sreenagar Branch
6 Bhairab Branch 43 Madaripur Branch 80 Takerhat Branch
7 Bhulta Branch 44 Madhabdi Branch* 81 Tangail Branch
8 Board Bazar Branch 45 Manikganj Branch 82 Tarakandi Branch
9 Bakshiganj Branch 46 Mawna Chowrasta Branch 83 Tongi Branch
10 Cantonment Branch 47 Mirpur Branch * 84 Trishal Branch
11 Chawk Mugaltuly Branch* 48 Mirpur 1 Branch * 85 Uttara Branch*
12 Damodya Branch 49 Mirzapur Branch 86 VIP Road Branch*
13 Dohar Branch 50 Madhupur Branch 87 Wiseghat Branch
14 Dhanmondi Branch* 51 Mohakhali Branch* 88 Zinzira Branch
15 Dholaikhal Branch 52 Mohammadpur Krishi Market Branch 89 Fatulla Branch
16 Elephant Road Branch* 53 Motijheel Branch* 90 Kamrangirchar Branch
17 Faridpur Branch 54 Mouchak Branch * 91 Alanga SME/Krishi Branch
18 Farmgate Branch* 55 Moghbazar Branch 92 Bandura SME/Krishi Branch
19 Foreign Exchange Branch* 56 Munshiganj Branch 93 Zirani Bazar SME/Krishi Branch
20 Fulbaria Branch 57 Mymensingh Branch* 94 Muktagacha SME/Krishi Branch

Bank’s Network
95 Kalampur SME/Krishi Branch 133 Gouripur Branch 172 Anwara Branch

96 Sonargaon SME/Krishi Branch 134 Hajiganj Branch 173 Coatbazar SME/Krishi Branch
97 Bhanga SME/Krishi Branch 135 Hazirhat Branch 174 Barodarogahat SME/Krishi Branch
98 Chormuguria SME/Krishi Branch 136 Halishahar Branch 175 Moheshkhali SME/Krishi Branch
Chittagong Division 137 Hathazari Branch 176 Mirerswarai SME/Krishi Branch
99 Agrabad Branch* 138 Jubilee Road Branch* 177 Burichong SME/Krishi Branch
100 Anderkilla Branch* 139 Keranihat Branch 178 Parshuram SME/Krishi Branch
101 Ashuganj Branch 140 Khatunganj Branch* 179 Daudkandi SME/Krishi Branch
102 Bancharampur Branch 141 Laksham Branch 180 Chaprashirhat SME/Krishi Branch
103 Bandartila Branch 142 Luxmipur Branch 181 Akhaura SME/Krishi Branch
104 Bahaddarhat Branch 143 Lohagara Branch Khulna Division
105 Bank Road Branch 144 Maijdee Court Branch 182 Bagerhat Branch
106 Baraiyarhat Branch 145 Pahartali Branch* 183 Benapole Branch*
107 Bashurhat Branch 146 Nabinagar Branch 184 Chowgacha Branch
108 Bandarban Branch 147 Nazumeah Hat Branch 185 Chuadanga Branch
109 Bangodda Bazar Branch 148 Patiya Branch 186 Daulatpur Branch
110 Boalkhali Branch 149 Raipur Branch 187 Jessore Branch*
111 Brahmanbaria Branch 150 Ramganj Branch 188 Jhenaidah Branch
112 CDA Avenue Branch 151 Rangamati Branch 189 Jhikorgacha Branch
113 Chaktai Branch 152 Ramu Branch 190 Kalaroa Branch
114 Chandpur Branch 153 Sandwip Branch 191 Kaliganj Branch
115 Chandraganj Branch 154 Senbag Branch 192 Kaliganj Branch
116 Chatkhil Branch 155 Sitakunda Branch 193 Khulna Branch*
117 Chauddagram Branch 156 Sonagazi Branch 194 Koat Chandpur Branch
118 Chawk Bazaar Branch 157 Station Road Branch* 195 Kumarkhali Branch
119 Chiringa Branch 158 Subarnachar Branch 196 Kushtia Branch*
120 Chhagalnaiya Branch 159 Teknaf Branch 197 Magura Branch
121 Chowmuhani Branch * 160 Terry Patty Branch 198 Meherpur Branch
122 College Road Branch 161 Khagrachari Branch 199 Mongla Branch
123 Comilla Branch * 162 O.R. Nizam Road Branch 200 Morrelgonj Branch
124 Companiganj Branch 163 Oxyzen Moor Branch 201 Narail Branch
125 Kosba Branch 164 Matlab Branch 202 Noapara Branch*
126 Cox’s Bazar Branch 165 Raozan Branch 203 Paikgacha Branch
127 Dagunbhuiyan Branch 166 Chandina Branch 204 Poradah Branch
128 Dewanhat Branch 167 Banshkhali Branch 205 Sarankhola Branch
129 Eidgah Branch 168 Sachar Branch 206 Satkhira Branch
130 Faridganj Branch 169 Sonaimuri Branch 207 Shyamnagar Branch
131 Fatikchari Branch 170 Kadamtoli Branch 208 KDA Avenue Branch
132 Feni Branch 171 Pekua Branch.

Bank’s Network
209 Dak Banglabazar SME/Krishi 241 Nandigram SME/Krishi Branch 271 Sunamganj Branch*
Branch 242 Sujanagar SME/Krishi Branch 272 Zindabazar Branch
210 Fultala SME/Krishi Branch 243 Mohastangarh SME/Krishi 273 Dakshin Surma Branch
211 Jibon Nagar SME/Krishi Branch Branch 274 Golapgonj Branch
Rajshahi Division Barisal Division 275 Shayestagonj SME/Krishi
212 Belkuchi Branch 244 Barguna Branch Branch
213 Bogra Branch* 245 Barisal Branch* 276 Nabiganj SME/Krishi Branch
214 Chanchkoir Branch 246 Bhola Branch Rangpur Division
215 Chapai Nawabganj Branch* 247 Jhalokathi Branch 277 Birampur Branch
216 Dupchanchia Branch 248 Miarhat Branch 278 Bhurungamari Branch
217 Highway Branch 249 Patuakhali Branch 279 Dinajpur Branch*
218 Ishwardi Branch 250 Pirojpur Branch 280 Dhap Branch
219 Joypurhat Branch 251 Torki Branch 281 Gaibandha Branch
220 Kashinathpur Branch 252 Bhandaria Branch 282 Gobindaganj Branch
221 Naogaon Branch 253 Charfashion Branch 283 Jaldhaka Branch
222 Natore Branch 254 Hatkhola Chawkbazar Branch 284 Kurigram Branch
223 Nazipur Branch 255 Lalmohan Branch 285 Lalmonirhat Branch
224 New Market Branch 256 Borhanuddin SME/Krishi 286 Nilphamari Branch
225 Pabna Branch* Branch 287 Panchagarh Branch
226 Panchbibi Branch Sylhet Division 288 Rangpur Branch
227 Rajshahi Branch* 257 Amberkhana Branch 289 Saidpur Branch*
228 Rohanpur Branch 258 Baralekha Branch 290 Setabganj Branch
229 Santhia Branch 259 Beani Bazar Branch 291 Sundarganj Branch
230 Sapahar Branch 260 Biswanath Branch 292 Thakurgaon Branch
231 Shahjadpur Branch 261 Chatak Branch 293 Roumari Branch
232 Shibganj Branch 262 Goala Bazar Branch 294 Patrgram SME/Krishi Branch
233 Sirajganj Branch 263 Habiganj Branch
234 Mohadevpur Branch 264 Jagannathpur Branch
235 Borogola Branch. 265 Kanaighat Branch
236 Ullahpara Branch 266 Kulaura Branch
237 Baneswar Branch 267 Laldighirpar Branch
238 Keshorehat SME/Krishi Branch 268 Moulvi Bazar Branch
239 Shantahar SME/Krishi Branch 269 Sreemangal Branch
240 Kahalu SME/Krishi Branch 270 Sylhet Branch*
* Authorized Dealer
N.B: The detail address of the Branch is available at our website www.islamibankbd.com

Glossary
AAOIFI Accounting and Auditing Organization for Islamic Financial Institutions HR Human Resources
AD Authorized Dealer HTM Held to Maturity
ADB Asian Development Bank IAS International Accounting Standards
ADC Alternative Delivery Channel IBB Institute of Bankers, Bangladesh
AGM Annual General Meeting IBBL Islami Bank Bangladesh Limited
ALCO Asset Liability Committee IBIT Islami Bank Institute of Technology
ATM Automated Teller Machine IBCF Islamic Banks Consultative Forum
BAB Bangladesh Association of Banks IBCA Inter Branch Credit Advice
BACH Bangladesh Automated Clearing House IBDA Inter Branch Debit Advice
BACPS Bangladesh Automated Cheque Processing System IBP Inland Bill Purchase
BAFEDA Bangladesh Foreign Exchange Dealers Association IBF Islami Bank Foundation
BAS Bangladesh Accounting Standards IBTRA Islami Bank Training & Research Academy
BB Bangladesh Bank ICAB Institute of Chartered Accountants of Bangladesh
BBTA Bangladesh Bank Training Academy ICMAB Institute of Cost and Management Accountants of Bangladesh
BCP Business Continuity Plan IC&CW Internal Control & Compliance Wing
BDT Bangladeshi Taka ICB Investment Corporation of Bangladesh
BEFTN Bangladesh Electronic Fund Transfer Network ICT Information and Communication Technology
BFIU Bangladesh Financial Intelligence Unit ICTIC Information and Communication Technology Implementation Committee
BFRS Bangladesh Financial Reporting Standards IDB Islamic Development Bank
BIBM Bangladesh Institute of Bank Management IFRS International Financial Reporting Standards
BO Beneficiary Owners IPO Initial Public Offering
BRPD Banking Regulation & Policy Department IRG Investment Risk Grading
BSA Bangladesh Standards on Auditing LC Letter of Credit
BSEC Bangladesh Security and Exchange Commission MCR Minimum Capital Requirement
CAMLCO Chief Anti Money Laundering Compliance Officer MEIS Micro Enterprise Investment Scheme
CAR Capital Adequacy Ratio MICR Magnetic Ink Character Recognition
CDBL Central Depository Bangladesh Limited MIS Management Information System
CEO Chief Executive Officer MPB Mudaraba Perpetual Bond
CFO Chief Financial Officer NAV Net Asset Value
CIB Credit Information Bureau NOC No Objection Certificate
CNG Compressed Natural Gas NPI Non-performing Investment
CPI Consumer Price Index NRD Non Resident Dollar account
CRAR Capital Adequacy Assessment Ratio OBU Offshore Banking Unit
CRISL Credit Rating Information and Services Limited PCB Private Commercial Banks
CRO Chief Risk Officer POS Point of Sales
CRR Cash Reserve Requirement PPD Profit Paid on Deposits
CSR Corporate Social Responsibility PV Present Value
CSBIBB Central Shari’ah Board for Islamic Banks of Bangladesh RDS Rural Development Scheme
CSE Chittagong Stock Exchange R&D Research and Development
CTR Cash Transaction Report RMG Readymade Garments
DC Data Center ROA Return on Assets
DCFCL Departmental Control Function Check List ROE Return on Equity
DOS Department of Offsite Supervision ROI Return on Investment
DRS Disaster Recovery Site RWA Risk Weighted Assets
DSE Dhaka Stock Exchange Ltd SAFA South Asian Federation of Accountants
EFT Electronic Fund Transfer SEC Securities and Exchange Commission
eIBS Electronic Integrated Banking System SLR Statutory Liquidity Ratio
EPS Earnings Per Share SME Small & Medium Enterprise
ETP Effluent Treatment Plants SMS Short Message Service
EU European Union SMA Special Mention Account
EVA Economic Value Added SOB State Owned Banks
FCB Foreign Commercial Bank SRP Supervisory Review Process
FY Financial Year STR Suspicious Transaction Report
GCIBFI General Council for Islamic Banks and Financial Institutions SWIFT Society for Worldwide Inter-Bank Financial Tele-communication
GDP Gross Domestic Product TA Traveling Allowance
GOB Government of Bangladesh TOR Terms of Reference
HDS Household Durables Scheme VAT Value Added Tax
HFT Held for Trading WAN Wide Area Network
HPSM Hire-Purchase under Shirkatul Melk

NOTICE OF THE 32nd ANNUAL GENERAL MEETING
Notice is hereby given that the 32nd Annual General Meeting of Islami Bank Bangladesh Limited will be held on Saturday, the
13th June, 2015 at 10.00 AM at Bangabandhu International Conference Centre (BICC), Agargaon, Sher-e-Bangla Nagar, Dhaka
for transacting the following business:
Agenda
01. To receive, consider and adopt the Audited Financial Statements for the year that ended on 31st
December 2014 and Reports of the Directors and Auditors thereon.
02. To approve Dividend for the year that ended on 31st December 2014.
03. To appoint Auditor(s) and to fix up their remuneration for the year 2015.
04. To elect/re-elect Directors
05. To approve appointment of Independent Directors.
06. To transact any other business with the permission of the chair.
All Members are requested to kindly make it convenient to attend the Meeting in time.
By order of the Board of Directors
Dated: Dhaka (Abu Reza Md. Yeahia)

22nd March, 2015 Company Secretary
------------------------------------------------------------------------------------------------------------------------------------------------------------
Notes:
a) Record date is 16/04/2015 i.e. the honorable shareholders whose names will appear in the CDS (Central Depository
System) / Company’s Register on 16/04/2015 will be entitled to get dividend for the Year 2014 against their
shareholdings.
b) A member eligible for attending and voting at the Annual General Meeting may appoint a proxy on his / her behalf.
c) Power of Attorney/Proxy/ Forms must be submitted to the Registered Office or Share Department (63, Dilkusha C/A, 5th
Floor, Dhaka) of the Company at least 48 (Forty Eight) hours before the Meeting i.e. 10.00 AM on Thursday, the 11th June,
2015. Revenue Stamp of Tk.20/- (Taka Twenty) only shall have to be affixed on the Proxy Form.
d) The last date for submitting nomination papers at the registered office for election of Directors is 6th June, 2015,
Saturday up to 10.00 AM and last date of withdrawal of nomination paper is 8th June, 2015, Monday up to 12.00 noon.
Scrutiny of nomination papers will be completed on the same day by 5.00 PM.
e) List of the valid candidates for election of Directors will be hung in the Notice Board at the Registered Office on Monday,
the 8th June, 2015 in the afternoon.
f) Election procedures and rules thereto will be available at the Registered Office of the Company/Meeting Place.
g) Annual Report, Attendance Slip and Proxy Form along with the Notice will be sent to the honorable shareholders by post
/ courier. The honorable shareholders may also collect Proxy Forms etc. from the Share Department of the Company.
h) Directors’ Report and Audited Financial Statements of the Bank for the year ended on 31st December 2014 along with the
Auditors’ Report thereon shall be available on Bank’s website (www.islamibankbd.com) from 25/05/2015 onward.
i) Entry is reserved only for Members and Proxies / Attorneys Attendance Slip (duly signed) must be submitted to the
Registration Counter at the time of entrance. Registration Counter shall remain open till 11.00 AM.

PROXY FORM
I/We ------------------------------------------------------------------------------------------------------------------------------------------------------------------ being a member(s) of lslami
Bank Bangladesh Limited do hereby appoint Janab--------------------------------------------------------------------------------------------------------------------------
of---------------------------------------------------------------------------------------- as my/our Proxy to attend and vote on behalf of me/us at the 32nd Annual
General Meeting of the Company to be held on Saturday, the 13th June, 2015 at 10.00 AM at Bangabandhu International Conference Centre
(BICC), Agargaon, Sher-e-Bangla Nagar, Dhaka and at any adjourment thereof.
As witness my/our hand this --------------------------------- day of ------------------------- 2015.
Folio No.: ---------------------------------------------------- BO ID No.:
Tk. 20.00
---------------------------------------------- ------------------------------ (twenty) only -----------------------------------------------------
Signature of the Attorney/ No. of Share(s) Signature of the Member with date
Revenue Stamp
Proxy with date
N.B.: This Form of Proxy, duly signed (as recorded with the bank), stamped and completed must be submitted to the Registered Office or Share Department
(63 Dilkusha C/A, 5th Floor, Dhaka) of the Company at least 48 (Forty Eight) hours before the Meeting i.e. 10:00 AM on Thursday the 11th June 2015
The 32nd Annual General Meeting dated Saturday the 13th June, 2015
ATTENDANCE SLIP
I do hereby submit the Attendance Slip in connection with the 32nd Annual General Meeting of Islami Bank Bangladesh Limited held today Saturday, the 13th June,
2015 at 10.00 AM at Dhaka .
Full Name of the Member : ------------------------------------------------------ Signature of the Member with date
Folio No.: ---------------------- BO ID No.:
No. of Share(s)
Full Name of the Attorney/ Proxy: --------------------------------------------------------------------------------------------- Signature of the Attorney/Proxy with date
N.B.: Members are requested to handover the Attendance Slip at the entrance of the Meeting Hall.

Cover Design : Helpline Resources Ltd. / Mazhar
Inner Design : Helpline Resources Ltd. Sobhan Mansion (2nd Floor)

46/1, Purana Paltan, Dhaka 1000 / Mazhar, Ripon, Monower, Tajul
Printed by : Helpline Resources Ltd.

Annual Report 2014

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Chairman’s Message

Corporate Structure Directors’ Report 59

Management Report and Commentary

Our vision is to always strive to achieve superior financial

Our goal is to establish and maintain modern banking techniques,

We will try to encourage savings in the form of direct investment.

6 Annual Report 2014

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• Ensure Corporate Social Responsibilities (CSR) through all activities

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Shari’ah foundation of ethics • Ensuring justice and fairness

• Piety • Developing the work through innovative and creative ideas

• Allah-fearing state of mind • Preserving confidential information

10 Annual Report 2014

Better Bangladesh Foundation International Expatriate Day Channel I

Annual Report 2014 11

Awards & Recognitions

Institute of Chartered Accountants of Bangladesh (ICAB)

Institute of Cost and Management Accountants of Bangladesh (ICMAB)

Bangladesh Bank and SME Foundation

12 Annual Report 2014

• Potential impact on IBBL’s liquidity and/or costs of funding

Annual Report 2014 13

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Managing Director’s Review

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Board and its Committees

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Vice Chairman Dr. Hasan Mohd. Moinuddin

Annual Report 2014 25

Muhammad Abul Bashar Abdus Sadeque Bhuiyan

Md. Habibur Rahman Bhuiyan, FCA Md. Shafiqur Rahman

A.K.M. Abdul Malek Chowdhury Md. Shamsuzzaman

Md. Mahbub-ul-Alam Mohammad Ali

Rafi Ahmed Begh Abu Reza Mohd. Yeahia

Nurul Islam Khalifa Mohammed Shahid Ullah, ACA, CIB, CDCS

26 Annual Report 2014

Annual Report 2014 27

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

Annual Report 2014 29

Md. Abul Hossain is the General Manager of Investment Corporation of Bangladesh. He

Abdullah Abdul Aziz

30 Annual Report 2014

Humayun Bokhteyar is an Independent Director of Islami Bank Bangladesh Limited since

Prof. NRM Borhan Uddin, Ph.D.

Annual Report 2014 31

Barrister Mohammed Belayet Hossain is an Independent Director of Islami Bank Bangladesh

Barrister Hossain is a regular practitioner in the Supreme Court of Bangladesh. He acted

32 Annual Report 2014

Finance Minister awarding IBBL the ICMAB Best Corporate Award

Annual Report 2014 33

Meeting of the Executive Committee

34 Annual Report 2014