| Crescent Investment Bank Limited |
|
|
|
|
|
|
|
|
|
| Annual
Report 1999 |
|
|
|
| CONTENTS |
|
|
| Company
Information |
|
| Board
of Directors |
|
| Notice
of Annual General Meeting |
|
| Directors
Report and Chief Executive's Review |
|
| Form "34" |
|
|
| Auditor's
Report t~ the Members |
|
| Balance Sheet |
|
|
| Profit
and Loss Account |
|
| Statement
of Sources and Application of Funds |
|
| Notes
to the Accounts |
|
| Investor
Information |
|
| Form of Proxy |
|
|
|
| COMPANY
INFORMATION |
|
|
| Corporate
Secretary |
|
| Rashid Sadiq |
|
|
| Auditors |
|
| Riaz
Ahmad & Company |
|
| Chartered
Accountants |
|
|
| Legal Advisors |
|
| Hassan
& Hassan Advocates |
|
|
| Bankers |
|
| Bank
of America NT & $A |
|
| Bank
Al Habib Limited |
|
| Deutsche
Bank A. G. |
|
| Faysal
Bank Limited |
|
| Habib
American Bank |
|
| Habib
Bank A. G. Zurich |
|
| Industrial
Development Bank of Pakistan |
|
| Metropolitan
Bank Limited |
|
| Muslim
Commercial Bank Limited |
|
| National
Bank of Pakistan |
|
| National
Development Finance Corporation |
|
| Societe
Generale -The French and International Bank |
|
| Standard
Chartered Bank |
|
| The
Bank of Punjab |
|
| The
Bank of Khyber |
|
|
| Registered
Office |
|
| 83
- Babar Block, New Garden Town, Lahore. |
|
|
|
| BOARD
OF DIRECTORS |
|
|
| Muhammad
Rafi |
Chairman |
|
| Nessar Ahmed |
|
President & Chief
Executive |
|
| Ahsan
M. Saleem |
|
| Dr.
Amjad Waheed (N.I.T., Nominee) |
|
| Humayun
Mazhar |
|
| Tariq Shall |
|
| Zahid Bashir |
|
|
|
| NOTICE
OF ANNUAL GENERAL MEETING |
|
|
| NOTICE
is hereby given that the 10th Annual General Meeting of the shareholders of
Crescent |
|
| Investment
Bank Limited, will be held on Wednesday, June 14, 2000 at 11.30 a.m. at Pearl
Continental |
|
| Hotel,
Shahrah-e-Quaid-e-Azam, Lahore to transact the following business: |
|
|
| 1.
To receive, consider and adopt the audited accounts of the company for the
year ended |
|
| December
31, 1999 together with Directors' and Auditors' Reports thereon. |
|
|
| 2.
To approve as recommended by Directors, the payment of Cash Dividend @ 11.50%
i.e. |
|
| Rupees
1.15 per share for the year ended December 31, 1999. |
|
|
| 3. To appoint auditors and to fix their
remuneration. |
|
|
| By
Order of the Board |
|
|
| Rashid Sadiq |
|
| Corporate
Secretary |
|
|
| Registered
Office: |
|
| 03-Babar
Block, New Garden Town, |
|
| Lahore. |
|
| Phone:
No. (042) 5601974-75, 5039631 |
|
| Fax
No. (042) 5881976 |
|
| E-mail:
rashid.sadiq@cressoft.com.pk |
|
|
| Dated:
May 16, 2000 |
|
|
| NOTE: |
|
|
| 1.
The Members Register will remain closed from June 00, 2000 to June 14, 2000
(both days |
|
| inclusive).
Transfer received in order at the Registered Office by the close of business
hours |
|
| on
June 07, 2000 will be treated in time for the entitlement of dividend
payment. |
|
|
| 2.
A member eligible to attend and vote at this meeting may appoint another
member as proxy |
|
| to
attend and vote in the meeting. Proxies in order to be effective must be
received by the |
|
| company
at the Registered Office not later than 48 hours before the time of holding
the |
|
| meeting. |
|
|
| 3. CDC account holders will further have to
follow the under mentioned guidelines as laid down |
|
| in
circular No. 1 date January 26, 2000 of the Securities and Exchange
Commission of Pakistan |
|
| for
attending the meeting: |
|
|
| i)
In case of individuals, the account holder or sub-account holder and/or the
person |
|
| whose
securities are in group account and their registration details are uploaded
as |
|
| per
the Regulations, shall authenticate his identity by showing his original
National |
|
| Identity
Card (NIc) or original passport at the time of attending the meeting. The |
|
| shareholders
registered on CDS are also requested to bring their Participants I.D. |
|
| members
and account numbers in CDS. |
|
|
| ii)
In case of corporate entity, the Board of-Directors' resolution/power of
attorney with |
|
| specimen
signature of the nominee shall be produced (unless it has been provided |
|
| earlier)
at the time of meeting. |
|
|
|
| DIRECTORS
REPORT & |
|
| CHIEF
EXECUTIVE'S REVIEW |
|
|
| Dear
Shareholders, |
|
|
| We
are pleased to present herewith the 10th Annual Report of Crescent Investment
Bank Limited |
|
| (CresBank).
The report covers the twelve months period ended December 31, 1999. During
the |
|
| year
CresBank earned after tax profit of Rupees 138.52 million as against the
after tax loss of |
|
| Rupees
141.91 million last year. Political changes towards the end of the year and
subsequent |
|
| macro-economic
initiatives have resulted in significant Iowering of interest rates, easing
of liquidity |
|
| and
improvements on the stock markets. |
|
|
| Current
Economic Scenario: |
|
|
| The
economic indicators for the period 1998-99 incorporated the full impact of
the May 1995 events. |
|
| GDP
growth declined to 3.1% from 4.3% (revised) achieved during 1997-95.
Large-scale |
|
| manufacturing
arid agriculture sectors recorded reduced growth of 2.7% and 0.4%
respectively as |
|
| compared
to 7.6% and 3.8% during 1997-98. Budget deficit was reduced to 3.4% of GDP
from 5.6% |
|
| last
year. Inflation ((3PI) remained well under control at 5.7% as against 7.8%
last year. |
|
|
| A
socio-economic reform agenda was announced by the present government. One of
the pillars of |
|
| the
agenda is revival of the economy and restoration of investors confidence. The
first initiative |
|
| towards
economic revival has been to reduce the cost of capital i.e. State Bank's
discount rate has |
|
| been
lowered by 2% to 11%, a downward trend in T-Bill rates has been maintained
arid the rates on |
|
| savings
schemes have also been cut by around 2%. For long term strategy, the
government has |
|
| identified
four critical areas of growth i.e. agriculture, small and medium-sized
industries, oil and |
|
| gas,
arid information technology. The government is also directing its efforts
rewards higher revenue |
|
| collection.
To document undeclared assets, a tax amnesty scheme has also been announced.
Tax |
|
| on
agriculture is also to be introduced. |
|
|
| Debt
at 96.7% of GDP remains the country's most pressing problem. During financial
year 1999, |
|
| debt
servicing took up 65.5% of the total revenue. A high level of debt payments
has left the balance |
|
| of
payment position vulnerable to external shocks in December 2000 and with
increased oil prices |
|
| and
without a major turn around in exports, the government is most likely to seek
another round of |
|
| rescheduling. |
|
|
| The
KSE 100 index improved from 945 points as on December 31, 1998 to 1,409
points as on |
|
| December
31, 1999, an improvement of 49%. The major chunk of this increase (i.e.152
points) |
|
| occurred
after the October 1999 change. Market capitalization as at December 31, 1999
was |
|
| Rs.366.67
billion as against Rs.268.47 billion as on December 31, 1998, an increase of
36.6%. Due |
|
| to
discontinuation of prize schemes by Commercial Banks, unattractiveness of
investing in US Dollar |
|
| deposits
by resident Pakistanis and continuing depression in the real estate business,
there is |
|
| substantial
liquidity in the system. With a fall in interest rates, the stock market is
attracting a lot of |
|
| attention.
We maintain our optimistic outlook subject to success of the government's
intended reforms |
|
| and
restoration of the investors confidence. |
|
|
| Financing
Activities: |
|
|
| CresBank
continued to maintain a "high quality low risk" portfolio.
Outstanding position of |
|
| financial
assistance as on December 31, 1999 is given below: |
|
|
|
Rupees in Million |
|
|
|
December |
December |
Change Over |
|
|
31, 1999 |
31, 1998 |
1998 |
|
|
|
(Percentage) |
|
|
| Fund Based: |
|
1,572 |
4,053 |
(61.21) |
|
| Commercial
Papers |
1,279 |
3,675 |
|
|
| Loans
and Advances |
293 |
378 |
|
|
|
|
|
| Non-Fund
Based: |
997 |
978 |
1.94 |
|
| Guarantees
/ Acceptances |
997 |
978 |
|
|
|
| Due
to encashment of foreign currency deposits and unattractive yields thereon,
volumes have |
|
| registered
a significant decline. |
|
|
| Balance
Sheet & Operating Results |
|
|
| Total
assets of CresBank as at December, 31, 1999 were Rupees 7,092 million as
against Rupees |
|
| 8,332
million last year. This depicted a decrease of Rupees 1,240 million (14.89
percent) over the |
|
| December
31, 1998 position. |
|
|
| CresBank
earned an after tax profit of Rupees 138.52 million during the year as
against a loss of |
|
| Rupees
141.91 million last year. The Operating Income before provisions, provisions
made during |
|
| the
year and appropriations thereof are as follows: |
|
|
|
(Rupees in
million) |
|
|
1999 |
1998 |
|
|
| OPERATING
INCOME BEFORE PROVISIONS |
|
166.54 |
54.33 |
|
| Provision
for Doubtful Commercial Papers, |
|
|
|
| Loans
& Advances, other Receivables & Guarantees |
|
56.70 |
52.41 |
|
| Provision
for Diminution in value of investments |
|
(34.68) |
137.93 |
|
|
---------- |
---------- |
|
| Total
Provisions |
|
22.02 |
190.34 |
|
|
---------- |
---------- |
|
| PROFIT/(LOSS)
BEFORE TAXATION |
|
144.52 |
(136.01 ) |
|
| Provision
for Taxation |
|
6.00 |
5.90 |
|
|
|
---------- |
---------- |
|
| PROFIT/(LOSS)
AFTER TAXATION |
|
138.52 |
(141.91) |
|
| Un-appropriated
profit brought forward |
|
0.01 |
141.92 |
|
|
---------- |
---------- |
|
| PROFIT
AVAILABLE FOR APPROPRIATION |
|
138.53 |
0.01 |
|
| APPROPRIATIONS |
|
| Transfer
to Reserve for Contingencies |
|
27.80 |
-- |
|
| Proposed
Cash Dividend @ 11.5% |
|
57.53 |
-- |
|
|
---------- |
---------- |
|
|
85.33 |
-- |
|
|
---------- |
---------- |
|
| UN-APPROPRIATED
PROFIT CARRIED FORWARD |
|
53.20 |
0.01 |
|
|
========== |
========== |
|
| Earning
per Share |
|
|
| The
after tax earning per share for the year 1999 works out to Rupees 2.77' per
share on the |
|
| outstanding
shares at the end of year. |
|
|
| Dividend |
|
|
| Considering
improved results for the year, the Board of Directors have recommended to pay
cash |
|
| dividend
at the rate of 11.50 percent i.e. Rupees 1.15 per share. |
|
|
| Y2K
Compliance |
|
|
| We
had reported in the 9th Annual Report that we had restructured all our
hardware and software |
|
| packages
well before time in order to move into the 21st century. It is a matter of
great satisfaction |
|
| to
report that there have been no glitches in the moreover to the new
millennium. |
|
|
| Future
Outlook |
|
|
| Due
to availability of substantial liquidity in the system, revival of the
textiles and cement sectors |
|
| and
hopes of success of the new macro economic initiatives, the stock market has
staged a substantial |
|
| recovery.
Accordingly, CresBank has initiated steps for restructuring its assets
profile to enable it to |
|
| meet
payments of Rupee counterpart funds to SBP and also improve the spreads. The
Company |
|
| for
running brokerage activities has already been incorporated. Other formalities
are being completed |
|
| and
it is expected that this will commence operations by the end of the year
2000. |
|
|
| Auditors |
|
|
| The
Auditors M/S. Riaz Ahmed & Company, Chartered Accountants, retire and
offer themselves for |
|
| re-election. |
|
|
| In
the end, the Directors appreciate the dedication and hard work put in by the
employees of the |
|
| Bank. |
|
|
| For
and on behalf of the Board of Directors |
|
|
| Nessar Ahmed |
|
| President
& Chief Executive |
|
|
| Dated:
16th May, 2000 |
|
|
|
| FORM '34' |
|
|
| Pattern
of Holding of Shares as at 31 December 1999 |
|
|
| No. of |
Shareholding |
|
|
| Shareholders |
From |
To |
Total Shares Held |
|
|
| 358 |
1 |
100 |
15737 |
|
| 572 |
101 |
500 |
142404 |
|
| 364 |
501 |
1000 |
268304 |
|
| 684 |
1001 |
5000 |
1508976 |
|
| 151 |
5001 |
10000 |
1006946 |
|
| 63 |
10001 |
15000 |
764746 |
|
| 36 |
15001 |
20000 |
625542 |
|
| 16 |
20001 |
25000 |
357653 |
|
| 27 |
25001 |
30000 |
720525 |
|
| 8 |
30001 |
35000 |
252866 |
|
| 17 |
35001 |
40000 |
624878 |
|
| 13 |
40001 |
45000 |
559422 |
|
| 6 |
45001 |
50000 |
290620 |
|
| 1 |
50001 |
55000 |
54972 |
|
| 4 |
55001 |
60000 |
230972 |
|
| 3 |
60001 |
65000 |
186667 |
|
| 2 |
70001 |
75000 |
142732 |
|
| 2 |
75001 |
80000 |
150074 |
|
| 4 |
80001 |
85000 |
330183 |
|
| 1 |
85001 |
90000 |
87907 |
|
| 1 |
90001 |
95000 |
90720 |
|
| 3 |
95001 |
100000 |
296443 |
|
| 2 |
100001 |
105000 |
201272 |
|
| 2 |
105001 |
110000 |
214986 |
|
| 5 |
110001 |
115000 |
564285 |
|
| 1 |
115001 |
120000 |
116400 |
|
| 2 |
125001 |
130000 |
250126 |
|
| 1 |
135001 |
140000 |
138645 |
|
| 1 |
145001 |
150000 |
149616 |
|
| 3 |
150001 |
155000 |
452230 |
|
| 1 |
170001 |
175000 |
170688 |
|
| 1 |
180001 |
185000 |
101020 |
|
| 1 |
185001 |
190000 |
105070 |
|
| 1 |
190001 |
195000 |
192034 |
|
| 1 |
205001 |
210000 |
200035 |
|
| 1 |
235001 |
240000 |
236927 |
|
| 1 |
245001 |
250000 |
245700 |
|
| 1 |
270001 |
275000 |
273970 |
|
| 1 |
295001 |
300000 |
295583 |
|
| 2 |
310001 |
315000 |
624901 |
|
| 1 |
340001 |
345000 |
344858 |
|
| 2 |
345001 |
350000 |
694388 |
|
| 1 |
395001 |
400000 |
395899 |
|
| 1 |
525001 |
530000 |
525239 |
|
| 1 |
605001 |
10000 |
807300 |
|
| 1 |
865001 |
890000 |
885222 |
|
| 3 |
960001 |
965000 |
2886096 |
|
| 1 |
970001 |
975000 |
974845 |
|
| 1 |
1130001 |
1135000 |
1131230 |
|
| 1 |
1445001 |
1450000 |
1449994 |
|
| 1 |
1915001 |
1920000 |
1919209 |
|
| 1 |
2310001 |
2315000 |
2310262 |
|
| 1 |
2425001 |
2430000 |
2427671 |
|
| 1 |
2680001 |
2685000 |
2682704 |
|
| 1 |
3125001 |
3130000 |
3127464 |
|
| 1 |
3700001 |
3705000 |
3700959 |
|
| 1 |
4995001 |
5000000 |
4998825 |
|
| 1 |
5350001 |
5355000 |
5352748 |
|
| ---------- |
|
---------- |
|
| 2385 |
|
50025690 |
|
| ========== |
|
========== |
|
|
| Categories
of Shareholders as at 31 December 1999 |
|
|
| Categories |
|
Numbers |
Shares Held |
Percentage |
|
|
| Individuals |
|
2205 |
9787703 |
19.566 |
|
|
|
|
| Investment
Companies |
11 |
1380649 |
2.760 |
|
|
|
|
| Insurance
Companies |
9 |
1351641 |
2.702 |
|
|
|
|
| Joint
Stock Companies |
71 |
20906445 |
41.791 |
|
|
|
|
| Financial
Institutions |
40 |
13420423 |
26.827 |
|
|
|
|
| Modaraba
Companies |
3 |
5340 |
0.010 |
|
|
|
|
| Others * |
|
46 |
3173489 |
6.344 |
|
|
---------- |
---------- |
---------- |
|
| TOTAL |
|
2385 |
50025690 |
100.000 |
|
|
========== |
========== |
========== |
|
| Others |
|
|
| Modarabas |
|
27 |
2670413 |
5.338 |
|
|
|
|
| Non-Residents |
|
14 |
475322 |
0.950 |
|
|
| Trust |
|
1 |
16067 |
0.032 |
|
|
| Others(CDC) |
|
4 |
11687 |
0.024 |
|
|
---------- |
---------- |
---------- |
|
| TOTAL |
|
46 |
3173489 |
6.34 |
|
|
========== |
========== |
========== |
|
|
|
|
|
| AUDITORS'
REPORT TO THE MEMBERS |
|
|
| We
have audited the annexed balance sheet of CRESCENT INVESTMENT BANK LIMITED as
at |
|
| 31
December 1999 and the related profit and loss account and statement of
sources and application |
|
| of
funds, together with the notes forming part thereof, for the year then ended
and we state that we |
|
| have
obtained all the information and explanations which to the best of our
knowledge and belief |
|
| were
necessary for the purposes of our audit and, after due verification thereof,
we report that: |
|
|
| (a)
in our opinion, proper books of account have been kept by the company as
required by the |
|
| Companies
Ordinance, 1984; |
|
|
| (b) in our opinion: |
|
|
| i)
the balance sheet and profit and loss account together with the notes thereon
have been |
|
| drawn
-up in conformity with the Companies Ordinance, 1984, and are in agreement
with the |
|
| books
of account and are further in accordance with accounting policies
consistently applied |
|
| except
for the changes as stated in notes 2.7 and 2.10 with which we concur; |
|
|
| ii)
the expenditure incurred during the year was for the purpose of the company's
business; and |
|
|
| iii)
the business conducted, investments made and the expenditure incurred during
the year |
|
| were
in accordance with objects of the company; |
|
|
| (c)
in our opinion and to the best of our information and according to the
explanations given to |
|
| us,
the balance sheet, profit and loss account and the statement of sources and
application of |
|
| funds,
together with the notes forming part thereof,' give the information required
by the |
|
| Companies
Ordinance, 1984, in the manner so required and respectively give a true and
fair |
|
| view
of the state of the company's affairs as at 31 December 1999 and of the
profit and the |
|
| changes
in sources and application of funds for the year then ended; and |
|
|
| (d)
in our opinion, Zakat deductible at source under the Zakat and Ushr
Ordinance, 1980 was |
|
| deducted
by the company and deposited in the Central Zakat Fund established under
Section |
|
| 7
of that Ordinance. |
|
|
| Lahore:
17 May 2000 |
|
Riaz Ahmad & Company |
|
|
Chartered Accountants |
|
|
|
| BALANCE
SHEET AS AT 31 DECEMBER 1999 |
|
|
|
NOTE |
RUPEES IN
THOUSAND |
|
|
|
1999 |
1998 |
|
|
| SHARE
CAPITAL AND RESERVES |
|
|
| Authorized
capital |
|
| 100,000,000
ordinary shares of Rupees 10 each |
|
1,000,000 |
1,000,000 |
|
|
|
|
| Issued,
subscribed and paid up capital |
|
3 |
500,257 |
427,570 |
|
|
|
|
|
| Reserves
and, surplus |
|
|
|
|
| Capital
reserves |
|
3 |
309,013 |
353,900 |
|
| Revenue
reserves |
|
3 |
239,470 |
239,470 |
|
| Unappropriated
profit |
|
|
53,203 |
12 |
|
|
|
|
|
|
|
601,686 |
593,382 |
|
|
|
1,101,943 |
1,020,952 |
|
| DEPOSITS
OF FIXED MATURITIES |
|
4 |
4,893,466 |
6,070,914 |
|
| BORROWINGS |
|
5 |
515,161 |
512,218 |
|
| OTHER
LIABILITIES AND PROVISIONS |
|
|
|
|
| Liabilities
against assets subject to finance lease |
|
6 |
9,521 |
9,717 |
|
| Profit
accrued on deposits / borrowings |
|
7 |
190,033 |
263,783 |
|
| Accrued
and other liabilities |
|
8 |
288,736 |
454,840 |
|
| Provision
against guarantees |
|
9.2 |
35,567 |
-- |
|
| Proposed
dividend |
|
|
57,530 |
-- |
|
|
|
|
|
|
|
581,387 |
728,340 |
|
|
|
|
| COMMITMENTS
AND |
|
|
|
| CONTINGENT
LIABILITIES |
|
9 |
|
|
----------- |
----------- |
|
|
7,091,957 |
8,332,424 |
|
|
========== |
========== |
|
| BALANCES
WITH BANKS AND IN HAND |
|
10 |
281,337 |
134,878 |
|
| INVESTMENTS |
|
|
|
| Share
I certificates |
|
|
|
|
| Quoted |
|
11 |
2,479,677 |
1,928,478 |
|
| Unquoted |
|
12 |
89,687 |
125,328 |
|
|
|
|
|
| Other
investments |
|
|
|
|
