Pak Libya is a Joint Venture Financial Institution (JVFI), operating within the framework of commercial and banking laws of Pakistan, regulated by the State Bank of Pakistan.

Pak Libya Holding Company (Pvt.) Limited was formed as a Private Limited Company in October 1978, owned jointly by the Government of Pakistan and the Government of Libya. It was established with an initial tenure of thirty years. Subsequently, this tenure was extended for further thirty years till October 2038.

The Company's primary objective is to foster the development of the country's industrial and economic infrastructure. Its core avenues are asset building: loans & advances, investments in the capital & money markets, and project and infrastructure financing and private equity. The registered office of the Company is located at 5th Floor, Block C, Finance and Trade Centre, Shahrah-e-Faisal, Karachi, Pakistan. The Company has one Sales and Service Center, which is located in Lahore.

The Company is equally owned by the Government of the Islamic Republic of Pakistan (GoP), represented through SBP & the Ministry of Finance (MoF), and the Government of Libya, represented through Libyan Foreign Investment Company (LAFICO), implying strong sovereign support.

The ownership structure of the Company has remained unchanged since its inception and is anticipated to persist in its current form in the foreseeable future.

The Company's sovereign ownership reflects the strong business acumen of the sponsors.

The financial muscle of the sponsors is considered very strong.

The overall control of the board is vested with five members, indicating equal representation of the sponsors. The Chairman, Mr. Jehad Jamal El Barag, is the representative of the Government of Libya, while the Company’s Managing Director, Mr. Tariq Mahmood, CFA, represents the Government of Pakistan.

The Chairman, Mr. Jehad Jamal El-Barag holds a Master’s degree in Arts and a Diploma in International Finance from Escuela de Alta Dirección y Administración (EADA) in Barcelona, Spain, as well as a Bachelor of Arts in Business Administration from SRH Hochschule, Berlin in Germany. Mr. Barag presently serves as Director, Corporate Management Department at Libyan Foreign Investment Company ("LAFICO"), Tripoli, Libya. He earlier also served with LAFICO as Deputy Director of Treasury and Cash Operations Management.

Mr. Bashir B. Omer Matok holds an MBA degree in Financial Management from the University of Hull, England and a Bachelor's in Accounting from Grayounis University, Benghazi, Libya. He has also attended international and local conferences, courses, and training programs on Forex Trading, Stock Market, and Banking. He brings with him extensive expertise of 28 years in Financial Management, Accounting, Portfolio Management and Stock Market Operations. He has established himself as a distinguished investment banker while overseeing a diverse range of business and management areas in various regions.

Mr. Tariq Mahmood holds a Master's degree from New Mexico State University USA and is also a CFA charter holder. He possesses more than 25 years of Corporate & Investment Banking Experience, including vital international exposure working at a U.S. bank in Texas, USA. He also worked in the Corporate & Investment Banking Group at one of the largest public sector banks in Pakistan for several years before joining one of the leading DFIs in 2010, where he headed the Corporate Finance & subsequently Investment Banking Divisions for several years. Mr. Tariq also served on the Boards of Central Depository Company of Pakistan and Deli-JW Glassware (a Chinese-Pakistani Joint Venture Company) as a Nominee Director.

Ms. Nasheeta Maryam Mohsin holds an MBA degree from the University of California, Berkeley, HAAS School of Business & M.Phil. in Development Studies from Cambridge University, UK. She has vast experience in the financial sector and is presently serving as a Special Secretary, Finance Division, Government of Pakistan, overseeing various functions including budget, external finance, debt management, and finance regulations, etc. Before assuming responsibility as Special Secretary, she was serving as Joint/Additional Secretary - External Finance, Secretary Social Welfare, Special Education, Women Development, etc.

Mr. Khalid S.T Benrjoba possesses a Master's degree in International Business from the United Kingdom and a Bachelor's degree in Accounting from Libya. He has served as a Board Member at Corinthia Group Malta, where he played a pivotal role in steering the company through complex business environments. He has also served with Pak Libya Holding Company as Deputy Managing Director and member of the Executive Committee to run, supervise, and oversee the Company's affairs.

In line with best corporate governance practices, the Company has three Board Committees in place, namely Audit Committee and Human Resource Management Committee, chaired by Mr. Khalid S.T Benrjoba and Mr. Jehad Jamal Ali El-Barag, respectively, while the Risk Management Committee is chaired by Ms. Nasheeta Maryam Mohsin. During the period, quarterly BOD meetings were held to review the Company’s performance and monitor progress toward its strategic objectives. Attendance by the Board members remained strong, and the minutes of all meetings were formally documented.

M/s Yousaf Adil, Chartered Accountants are the external auditors of the Company. They expressed an unqualified opinion on the financial statements of the Company for the period ended December 31, 2024. The Internal Audit Function, serving as the Third Line of Defense (TLD) in the internal control system, is one of the most critical components of the overall control environment. It provides independent assurance to the Board and/or its Audit Committee regarding the quality, effectiveness, and objective periodic assessment of the adequacy of governance, risk management, and the design and operational effectiveness of internal controls. This includes an evaluation of the work performed by the First and Second Lines of Defense in achieving risk management and control objectives. In line with the regulatory framework, the Internal Audit function of Pak Libya reports functionally to the Board Audit Committee. The Internal Audit Department of Pak Libya is staffed with three Full-Time Equivalent (FTE) employees, including the Chief Internal Auditor, Mr. M. Shakiluddin. The external audit for CY25 is at an advanced stage of completion.

The Company operates within a well-structured organizational framework designed to ensure the smooth execution of operations. To address the diverse functional requirements efficiently, the organization has been strategically divided into ten specialized departments namely (i) Corporate & Investment Banking, (ii) Private Equity & Strategic Initiatives, (iii) Treasury & Fund Management, (iv) Risk Management & Regulatory Compliance, (v) Legal Affairs & Special Assets, (vi) Operations, (vii) Finance, (viii) Human Resource & Administration, (ix) Information Technology, and (x) Internal Audit.

The Managing Director, Mr. Tariq Mahmood holds a Master's degree from New Mexico State University USA and is also a CFA charter holder. He possesses more than twenty-five years of Corporate & Investment Banking Experience, including international exposure with a U.S. bank and the Deputy Managing Director, Mr. Bashir B. Omer Matok is a distinguished investment banker with diversified international exposure of around 28 years. They are supported by a team of highly qualified and experienced professionals.

The management has multiple committees, namely Credit Committee, Asset & Liability Committee, Risk Review & Compliance Committee, IT Steering Committee, Human Resource Committee and Management Committee to ensure the smooth flow of operations. All these committees comprise the heads of various departments.

During the year, the Company deployed a Comprehensive MIS Dashboard. This single-window interface is designed to provide a centralized, real-time overview of the Loan Management System (LMS), enhancing data accessibility and decision-making. Key features of the new dashboard include Loan Portfolio Analysis, Detailed Data Reporting, and Client Monitoring. The Company's MIS system also includes IFRS 9 for the calculation of Expected Credit Losses (ECL). The Company operates an Oracle-based database system. The credit and treasury modules are implemented on the .NET platform, while the general ledger and other modules are maintained on Oracle.

Pak Libya has an independent Risk Management & Regulatory Compliance Department that monitors credit, market, liquidity and operational risks along with overseeing the Regulatory Compliance function. This department directly reports to the Executive Committee. The role of the ALCO, Risk Review & Compliance Committee and Credit Committee has been strengthened through monthly meetings and regular monitoring of the portfolio.

The DFI industry demonstrated improved financial performance during 9MCY25, supported by easing monetary conditions, prudent balance sheet management, and strong investment income generation. Following the State Bank of Pakistan’s gradual reduction in policy rates, the industry benefitted from lower funding costs and enhanced spreads on previously booked high-yield assets. Total assets of the sector stood at PKR 1.61trn in 9MCY25 compared to PKR 1.67trn in 9MCY24, reflecting a decline of ~3.4% YoY, mainly due to contraction in the investment portfolio. Total investments reduced to PKR 1.11trn from PKR 1.48trn, primarily driven by lower allocations in PIBs and T-bills amid changing interest rate expectations and maturity run-offs of high-yield instruments. On the funding side, total borrowings declined significantly to PKR 1.02trn in 9MCY25 from PKR 1.84trn in 9MCY24, reflecting reduced reliance on short-term market borrowings and improved liquidity management. Despite lower investment volumes, profitability improved substantially, with net mark-up/interest income increasing to PKR 51.3bln from PKR 22.2bln, while total income rose to PKR 64.7bln from PKR 31.5bln. Consequently, profit before tax and profit after tax increased to PKR 52.7bln and PKR 36.9bln, respectively, compared to PKR 16.6bln and PKR 13.1bln in 9MCY24. Asset quality indicators improved, with the infection ratio declining to 8.4% from 13.7%, supported by cautious lending strategies and recoveries. Meanwhile, capitalization remained strong, with CAR improving to 31.8% in 9MCY25 from 26.5% in 9MCY24, remaining comfortably above regulatory requirements. Going forward, the industry’s outlook remains stable; however, margin normalization may gradually emerge as high-yield assets mature in a relatively lower interest rate environment.

As of end-Dec24, with approximately 6% share in Advances, the Company falls in the low tier of the respective industry.

The Company derives its revenue from three principal business segments: Corporate & Investment Banking, Treasury & Fund Management and Private Equity & Strategic Initiatives. During CY25, the Company reported a markup income of PKR 35.1bln, compared to PKR 78.8bln in CY24, primarily reflecting the impact of reduced exposure in government securities at better spreads amidst a lower interest rate environment. Markup income was predominantly generated from the investment portfolio, which remains heavily concentrated in Government of Pakistan securities, followed by the loans & advances portfolio. During the year, both investment and advances yields declined owing to the reduction in policy rates and the consequent repricing of earning assets. Despite the compression in asset yields, the Company’s spreads improved, supported by prudent asset-liability management and effective repricing of funding costs, which partially offset the impact of the declining interest rate environment on core earnings.

During CY25, the Company’s total income registered a modest increase to PKR 3.4bln (CY24: PKR 3.0bln), primarily driven by a strong two-fold expansion in fee and commission income. This improvement was further supported by dividend income, which provided an additional cushion to the overall earnings base and enhanced income stability. On the expense side, non-markup expenses increased marginally to PKR 808mln (CY24: PKR 787mln), reflecting disciplined cost management. Despite this slight uptick in operating expenses, profitability strengthened significantly, supported by the improved income trajectory alongside a moderation in provisioning and taxation charges. As a result, the Company’s profit after tax (PAT) increased substantially to PKR 1.8bln (CY24: PKR 358mln), reflecting a strong recovery in bottom-line performance during the year.

The management intends to operate in the Islamic banking domain, for which in-principle approval has been given by SBP. Furthermore, the management’s strategy for portfolio expansion has yielded positive outcomes to date. Going forward, the management remains optimistic, with a continued strategic focus on strengthening core earnings and ensuring long-term sustainability.

As of CY25, the Company’s net advances increased notably to PKR 14.3bln (CY24: PKR 11.2bln), reflecting healthy credit expansion. Supported by the implementation of stringent and comprehensive risk assessment practices, the Company’s overall asset quality profile improved during the year. Consequently, non-performing loans (NPLs) recorded a marginal decline, while both gross and net infection ratios exhibited improvement over the period. This positive trend also extended to the net NPLs-to-equity ratio and the loan loss coverage ratio, indicating strengthened loss-absorption capacity. The Company’s credit exposure remained primarily diversified across key sectors, including Textile, Power, Chemical & Pharma, Steel, and Sugar.  In terms of borrower segmentation, exposures were predominantly concentrated in Corporate and Financial Institutions, followed by SMEs.

As of CY25, the Company’s investment portfolio declined to PKR 181.2bln (CY24: PKR 340.2bln), while continuing to represent a significant proportion of total assets. The portfolio remains predominantly invested in Government securities, primarily Pakistan Investment Bonds (PIBs), reflecting the Company’s strategy to mitigate exposure to interest rate volatility and preserve asset quality. This high concentration in sovereign instruments is consistent with a conservative investment approach adopted by management and broadly aligned with prevailing industry practices. The remaining allocation comprises non-government debt securities, shares of listed entities and others.

As of CY25, the Company’s funding matrix remained predominantly reliant on borrowings, which constituted a substantial share of total liabilities. These borrowings mainly comprised of facilities from financial institutions along with repurchase agreement (repo) borrowings. In parallel, the Company’s deposit base increased to PKR 12.6bln (CY24: PKR 10.1bln). The deposit mix primarily consisted of Certificates of Investment (COIs), with a notable concentration in the private sector, followed by government (federal and provincial) entities and individual investors.

As of CY25, the Company’s equity base strengthened significantly to PKR 11.4bln (CY24: PKR 6.1bln), primarily driven by a substantial gain on revaluation of assets alongside improved profitability. As a result, the Company remained compliant with the Minimum Capital Requirement (MCR), reflecting continued regulatory adequacy and financial resilience. This improvement was also reflected in the equity-to-total assets ratio, which increased to 5.5% (CY24: 1.6%), indicating a stronger capital position relative to the balance sheet size. The Capital Adequacy Ratio (CAR) of PLHCL remained well above the regulatory threshold, standing at 40.78% (CY24: 30.31%), thereby maintaining a substantial buffer against the minimum requirement by the State Bank of Pakistan.