OLP Financial Services Pakistan Limited ('OLP' or 'the Company') commenced commercial operations in 1986 as a private limited company and later converted into a public limited company in 1987. It is listed on PSX. OLP was established as a joint venture between ORIX Corporation, Japan and local investors. The blend of international experience and local expertise garnered over the last 39 years provides OLP with a unique competitive edge. OLP provides innovative financial products and services across Pakistan through its network of 33 branches in 31 cities. Following ORIX Corp’s diversification strategy, the Company focuses on achieving business excellence with a nationwide customer base, particularly SMEs. Operating under an Investment Finance Services license from the Securities Commission of Pakistan, OLP serves both corporate and individual customers.

The Company's main shareholding resides with ORIX Corp. (~49.58%), followed by State Life Insurance Corporation (~9.81%). The general public holds ~(33.71)%, with the rest distributed among various entities. The shareholding structure provides stability to the Company's ownership. Listed on the Tokyo and New York Stock Exchanges, ORIX Corp. is a leading integrated financial services group in Japan, operating across 28 countries and regions globally. Its business has evolved from leasing to include lending, investment, life insurance, banking, asset management, automobile, real estate, and environmental and energy-related activities. The Group has experience of six decades of operations and has a total asset base of (¥ 16,866bln Mar-25) and equity of (¥ 4,172bln Mar-25 ).

The Company has an eight-member Board including deemed director, CEO, five Non-Executive Directors, and two Independent Directors. The Board also includes one Female Director. Mr. Khalid Aziz Mirza, Chairman of the Board, brings over five decades of experience and has been associated with the Board since Jun’16. Mr. Rashid Ahmed Jafer, an Independent Director, is a fellow member of ICAP and a member of the SBP - ICAP Coordination Committee and has over three decades of experience in statutory audit. He joined the Board on 26-Oct-23. Furthermore, Mr. Anwar Mansoor Khan, an independent director, renowned supreme court lawyer, and ex-attorney general of Pakistan, is also present on the Board. The Board similarly consists of members with years of diverse and relevant experiences. The Board meets periodically and is assisted by four Board committees: (I) Audit & Risk Committee, (II) Human Resource Nomination and Remuneration Committee, (III) Credit Committee, and (IV) Compensation Committee to ensure rigorous monitoring of management's policies and the entity's operations. These committees are headed by Independent / Non-Executive Directors Directors. Overall, Board oversight is considered effective with timely meetings, while minutes of the meetings are documented adequately. The Company's external auditor, M/S. A.F. Fergusons & Co. issued an unqualified audit opinion on the annual financial statements for FY24. For FY25, KPMG Taseer Hadi & Co has been appointed as the Company's external auditors. Both firms are QCR-rated and in category 'A' of SBP's panel

The Company has a well-established organizational structure with all heads of departments, except Internal Audit, reporting to the CEO, who then reports to the BoD. However, the head of Internal Audit reports to the BoD through the Audit & Risk Committee. Mr. Shaheen Amin, CEO, has been associated with the Company since 1986 and has served in various positions during his tenure. Further, Mr. Mian Faysal Riaz, COO, has been with the Company for over three decades. They are supported by an experienced management team. The Company has four management committees, namely Management Committee, Asset & Liability Management Committee, Management Credit Committee, and IT Steering Committee. Management committees meet regularly to enhance the governance process throughout the organization. The Company has in-house IT application software that has periodically been upgraded and extended to all areas of the business. The Company has implemented numerous policies and procedures, such as the IT Security Policy and Business Continuity Plan, to ensure smooth and continued operations. The risk department has defined minimum thresholds for credit approval, and all credits falling below the minimum level of threshold are subject to a post-execution risk review, in which the risk department performs a thorough review of credit documents.

NBFCs have emerged as an alternative to the conventional banking system, catering to Infrastructure, SMEs, etc., sectors operating in the economy. Despite improving the country's financial inclusion, NBFCs have limited outreach. NBFCs have witnessed ~34.5% YoY growth in total assets from ~ PKR 3,447bln in 6MFY24 to ~ PKR 6,204bln in 6MFY25. The Company holds substantial structural advantages over its peers to support the growth plans and help in maintaining a leadership position in the NBFCs industry. OLP has reported a PAT of ~PKR 1007mln, with the highest asset base of ~PKR 34,582mln in the industry in 9MFY25. Core Income is generated through finance and loans (~68%) and finance leases (~32%). The Company's topline grew by ~16.6% to ~PKR 6,885mln (FY23: ~PKR 5,903mln) during FY24. This is mainly due to increased earning portfolios and a high policy rate. On the other hand, during 9MFY25, the topline witnessed a decline of ~9% to ~PKR 5,399mln (9MFY24: ~PKR 5,961mln), due to declining interest rates resulting in the markup on the finance lease to fall by ~33% to ~PKR 1,447mln (9MFY24: PKR 2,144mln) during 9MFY25. During FY24, the Company's value-driven growth was impacted by rising interest expense (~22.7%) (FY24: ~PKR 3,876mln, FY23: ~PKR 3,158mln). However, due to a wider interest rate spread, the Company reported an increase of ~15% in its net income, reporting it at ~PKR 1,393mln (FY23: ~PKR1,211mln). On the other hand, during 9MFY25, the Company reported a drop of ~14% in the finance costs to ~PKR 2,494mln (9MFY24: ~PKR 2,916mln) due to falling interest rates. Owing to higher inflationary pressure, administrative and general expenses grew, reported at ~PKR 1,235mln (9MFY24: ~PKR 1,200mln) in 9MFY25. The Company, facing a trickle-down effect of declining income and increased administrative expenses, reported a declined profit after tax of ~PKR 1,007mln (9MFY24: ~PKR 1,081mln). The Company's key strengths lie in its robust risk management framework, cautious portfolio-building strategy for future business growth, and ongoing efforts to establish a foundation for launching new products when the market stabilizes.

The well-diversified finances/loan portfolio, with  limited concentrated in the top 20 groups, is deemed satisfactory. The Company's extensive track record and understanding of the target customer segment further support asset quality metrics. The Company is exposed to market risk mainly in the form of movement in interest rates affecting its debt obligations, leases, and loan receivables. The Company also has a policy not to assume any unhedged foreign currency position. The Company has an investment book of ~PKR 4,455mln as of 9MFY25 (9MFY24: ~PKR 4,913mln), reporting a decline of ~9.3% primarily due to redemption of treasury bills. The investment portfolio is divided into Government Securities (~51%) and Related Party investments (~49%), with a minimal allocation to the equity market. As of 9MFY25, the Company reported an Investment/Equity coverage of ~40.6% (9MFY24: ~46.8%), a decline of ~6.2% due to a decline in treasury bills lowering the investment book of the Company ultimately impacting the coverage. The Company utilizes Certificates of Investment/Deposits (COI/COD) and borrows from financial institutes for funding needs. As of 9MFY25, total funding was reported at ~PKR 20,635mln (9MFY24: ~PKR 18,257mln) with an increase of ~13% and decrease in Certificates of Investments/Deposits by ~38% to ~PKR 3,336mln (9MFY24: ~PKR 5,337mln). The Company's liquidity position decrease to ~13% during 9MFY25 (9MFY24: ~15.4%). As of FY24, the Company's equity base reported an increase of ~6.91% to ~PKR 10,471mln (FY23: ~PKR 9,794mln) due to the rise in the Company's unappropriated profit by ~PKR 661.2mln. Furthermore, increasing equity and a decline in funding by ~2.4% to ~PKR 18,235mln (FY24: ~PKR 18,679mln) improved debt to equity ratio to ~1.7x (FY23: ~1.9x). During 9MFY25, a similar rise in the Company's equity base was reported with an increase of ~4.5% to ~PKR 10,970mln (9MFY24: ~PKR 10,492mln) while the debt to equity ratio also increased to ~1.9x (9MFY24: ~1.7x). The Company has reported a Capital Adequacy Ratio (CAR) of ~28% as of 9MFY25 (9MFY24: ~29%).

OLP Financial Services Pakistan Ltd. has issued a privately placed Term Finance Certificate "PPTFC", as an instrument of Redeemable Capital. The issue amount is PKR 3,000mln inclusive of PKR 1,000mln for the green shoe option. Allied Bank Limited shall be the Financial Advisor & Lead Arranger. Tenor up to 05 years inclusive of 01 year grace period. The profit rate is 3-month KIBOR plus 80bps per annum, with no floor or cap. Repayments shall be made in 16 equal quarterly installments; the first principal repayment falling due at the end of 15 months from the date of the first disbursement. The proceeds are mainly for the purpose of meeting working capital requirements.

The issue is secured against specific charges on leases and financial assets and related receivables with a 25% margin. The Company shall not create any encumbrances with respect to the underlying security and claims of such security holders shall rank superior to the claims of ordinary shareholders.

The PPTFC is secured against a specific charge on leases and financial assets and related receivables with an initial margin maintained at 25%, which collectively covers value amounting to PKR 4bln, which provides mitigation against unforeseeable risk.