Notes to and forming part of the Consolidated Financial Statements

For the year ended December 31, 2018

Remeasurement of defined benefit obligations

Remeasurement gains and losses arising from experience adjustments and changes in actuarial assumptions are
recognized in other comprehensive income when they occur with no subsequent recycling through the profit and loss
account.

Remeasurement gains and losses pertaining to long term compensated absences are recognized in the profit and loss
account immediately.

5.12.2 United National Bank Limited (UBL UK)

Defined benefit scheme

UBL UK operates a pension scheme (defined benefit scheme) for certain staff. This scheme is closed for new members
and the accrual of benefits has ceased from January 1, 2010. Gains and losses on settlements and curtailments are
charged to the profit and loss account. The interest cost and the expected return on assets are included in other liabilities
and other assets respectively. Remeasurement gains and losses are recognised immediately in other comprehensive
income.

The defined benefit scheme is funded, with the assets of the scheme held separately from those of UBL UK, in separate
trustee administered funds. Pension scheme assets are measured at fair value and liabilities are measured based on
actuarial valuations using the Projected Unit Credit Method. The actuarial valuations are obtained at least triennially and
are updated at each statement of financial position date.

Defined contribution scheme

UBL UK operates a defined contributory pension scheme. The contribution payable in the year in respect of pension costs
and other post-retirement benefits is charged to the profit and loss account. Differences between the contribution payable
in the year and contribution actually paid are shown as either accruals or prepayments in the statement of financial
position.

5.12.3 UBL Fund Managers Limited (UFML)

Defined benefit plan

UFML operates an approved funded gratuity scheme for all employees. Annual contributions to the fund are made on the
basis of actuarial advice using the Projected Unit Credit Method. Remeasurement gains and losses arising from
experience adjustments and changes in actuarial assumptions are recognized in other comprehensive income when they
occur with no subsequent recycling through the profit and loss account.

Defined contribution plan

UFML operates an approved contributory provident fund (defined contribution scheme) for all eligible employees.

Employee Stock Option Scheme

UBL Fund Managers provides an incentive scheme for its top performing employees in the form of share options under the
Employee Stock Option Scheme (ESOS). The scheme has been approved by the SECP.

5.12.4 UBL (Switzerland) AG

UBL (Switzerland) AG maintains a contribution-oriented pension scheme for employees who have reached the age of 25.
It bears a large share of the costs of the occupational pension plan for all employees as well as their surviving dependents
pursuant to legal requirements. The employee benefit obligations and the assets serving as coverage are outsourced to a
collective insurance firm. The organization, management and financing of the pension plan comply with legal regulations,
the deed of foundation and the applicable regulations of the benefit plan.

5.12.5 UBL Bank (Tanzania) Limited

All eligible employees are members of the Public Pension Fund (PPF) or National Social Security Fund (NSSF). The fund
is a defined contribution scheme with the Bank having no legal or constructive obligation to pay further top-up
contributions.

180 United Bank Limited