Interim report
Page 1
PO Box 751 PC 112 Ruwi Sultanate of Oman. National Bank of Oman SAOG CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS 30 June 2026 (UNAUDITED)
Page 2
SR.NO INDEX PAGE NO 1 CHAIRPERSON’S REPORT 1 2 CONDENSED CONSOLIDATED INTERIM STATEMENT OF FINANCIAL POSITION 2 3 CONDENSED CONSOLIDATED INTERIM STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME 3 4 CONDENSED CONSOLIDATED INTERIM STATEMENT OF CASH FLOWS 4 5 CONDENSED CONSOLIDATED INTERIM STATEMENT OF CHANGES IN EQUITY 5 6 NOTES TO CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS 6 - 33
Page 13
-3- CONDENSED CONSOLIDATED INTERIM STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME For the period ended 30 June 2026 (unaudited) Six months ended 30 June Three months ended 30 June 2026 2025 2026 2025 Notes ’000 ’000 ’000 ’000 Interest income 16 124,055 120,908 63,045 60,408 Interest expense 17 (69,358) (71,352) (35,385) (35,065) NET INTEREST INCOME 54,697 49,556 27,660 25,343 Income from Islamic financing and Investment 13,686 12,376 6,942 6,546 Interest expenses on Islamic customers’ deposits (8,829) (8,597) (4,561) (4,617) NET INCOME FROM ISLAMIC FINANCING AND INVESTMENTS 4,857 3,779 2,381 1,929 NET INTEREST INCOME AND NET INCOME FROM ISLAMIC FINANCING AND INVESTMENTS 59,554 53,335 30,041 27,272 Fee and commission income 18 21,914 21,440 12,064 11,490 Fee and commission expenses (9,276) (7,699) (4,878) (4,184) Net fee and commission income 12,638 13,741 7,186 7,306 Other operating income 19 18,694 12,363 7,417 4,727 OPERATING INCOME 90,886 79,439 44,644 39,305 Staff costs 20 (21,266) (20,373) (10,592) (10,078) Other operating expenses 21 (10,815) (8,818) (5,677) (4,494) Depreciation 8 (3,466) (3,191) (1,755) (1,590) TOTAL OPERATING EXPENSES (35,547) (32,382) (18,024) (16,162) PROFIT FROM OPERATIONS BEFORE IMPAIRMENT LOSSES AND TAX 55,339 47,057 26,620 23,143 Total impairment losses on financial instruments (net) 22.5 (9,813) (7,097) (4,229) (3,288) PROFIT BEFORE TAX 45,526 39,960 22,391 19,855 Taxation 12 (6,436) (5,935) (2,767) (2,911) PROFIT FOR THE PERIOD 39,090 34,025 19,624 16,944 OTHER COMPREHENSIVE INCOME/(LOSS) Items that will not be reclassified to profit or loss Equity investments at FVOCI – net change in fair value 14,052 7,885 (4,378) 10,879 Tax effect of equity investments at FVOCI – net change in fair value (196) (1,035) (377) (826) OTHER COMPREHENSIVE INCOME/(LOSS) 13,856 6,850 (4,755) 10,053 TOTAL COMPREHENSIVE INCOME FOR THE PERIOD 52,946 40,875 14,869 26,997 Earnings per share: Basic and diluted 23 0.015 0.016 0.003 0.005 The attached notes 1 to 31 form part of the condensed consolidated interim financial statements.
Page 14
-4- CONDENSED CONSOLIDATED INTERIM STATEMENT OF CASH FLOWS For the period ended 30 June 2026 (unaudited) Notes Six months ended 30 June 2026 2025 ’000 ’000 Operating activities Profit before taxation 45,526 39,960 Adjustments for: Depreciation 8 3,466 3,191 Total impairment losses on financial instruments (net) 22.5 9,813 7,097 Gain on investments at FVTPL and amortised cost (4,232) (115) Loss on sale of property and equipment - 4 Amortisation of (discount)/ premium (net) (589) (707) Translation differences (10) - Income from investment securities (dividend and interest) (18,620) (16,836) Operating cash flows before changes in operating assets and liabilities 35,354 32,594 Due from banks and other money market placements 184,180 41,557 Loans, advances and Islamic financing assets (303,346) (147,576) Other assets (51,045) (18,551) Due to banks and other money market deposits 76,459 137,040 Customers’ deposits 584,843 76,320 Other liabilities 61,960 25,955 Cash generated from operating activities 588,405 147,339 Taxes paid (8,803) (6,973) Cash generated from operating activities 579,602 140,366 Investing activities Purchase of investment securities (223,980) (133,256) Proceeds from sale of investment securities 119,367 21,871 Purchase of property and equipment 8 (2,564) (2,103) Proceeds from sale of property and equipment - 10 Income from investment securities (dividend and interest) 17,758 16,406 Net cash used in investing activities (89,419) (97,072) Financing activities Payment of dividend (17,072) (15,284) Payment of lease liabilities (1,145) (1,179) Repayment of Tier 1 perpetual bond (115,500) - Payment of interest on Tier 1 perpetual bond (14,056) (8,316) Net cash used in financing activities (147,773) (24,779) Increase in cash and cash equivalents 342,410 18,515 Cash and cash equivalents at the beginning of the period 415,871 511,310 Cash and cash equivalents at the end of the period 758,281 529,825 Representing: Cash and balances with Central Banks 3 316,773 284,414 Due from Banks with original maturity of three months or less 441,508 245,411 758,281 529,825 Interest received was 60.74 million (30 June 2025: 128.03 million) and interest paid was 37.47 million (30 June 2025: 81.27 million). These are part of the operating cash flows of the Bank. There are no significant non-cash changes to be disclosed for 2026 and 2025. The attached notes 1 to 31 form part of the condensed consolidated interim financial statements
Page 15
- 5 - CONDENSED CONSOLIDATED INTERIM STATEMENT OF CHANGES IN EQUITY For the period ended 30 June 2026 (unaudited) ( ’000) Share capital Share premium Legal reserve Other reserves Retained earnings Total Tier 1 perpetual bond Total equity Balance at 1 January 2026 162,595 34,465 54,198 20,722 329,739 601,719 398,287 1,000,006 Profit for the period - - - - 39,090 39,090 - 39,090 Other comprehensive income for the period - - - 13,856 - 13,856 - 13,856 Total comprehensive income for the period - - - 13,856 39,090 52,946 - 52,946 Net losses on derecognition of financial instruments measured at FVOCI (net of tax) - - - 745 (745) - - - Payment of interest on Tier 1 perpetual bond - - - - (14,056) (14,056) - (14,056) Repayment of Tier 1 perpetual bonds - - - - - - (115,500) (115,500) Dividend paid during the period - - - - (17,072) (17,072) - (17,072) Balance at 30 June 2026 162,595 34,465 54,198 35,323 336,956 623,537 282,787 906,324 Balance at 1 January 2025 162,595 34,465 54,198 11,429 280,437 543,124 225,037 768,161 Profit for the period - - - - 34,025 34,025 - 34,025 Other comprehensive income for the period - - - 6,850 - 6,850 - 6,850 Total comprehensive income for the period - - - 6,850 34,025 40,875 - 40,875 Net losses on de-recognition of financial instruments measured at FVOCI (net of tax) - - - 107 (107) - - - Transfer to impairment reserve - - - 1,055 (1,055) - - - Payment of interest on Tier 1 perpetual bond - - - - (8,316) (8,316) - (8,316) Dividend paid during the period - - - - (15,284) (15,284) - (15,284) Balance at 30 June 2025 162,595 34,465 54,198 19,441 289,700 560,399 225,037 785,436 Profit for the period - - - - 36,182 36,182 - 36,182 Other comprehensive income for the period - - - 14,557 - 14,557 - 14,557 Total comprehensive income for the period - - - 14,557 36,182 50,739 - 50,739 Net gain on derecognition of financial instruments measured at FVOCI (net of tax) - - - (12,221) 12,221 - - - Transfer to impairment reserve - - - (1,055) 1,055 - - - Payment of interest on Tier 1 perpetual bond - - - - (8,318) (8,318) - (8,318) Issuance of Tier 1 perpetual bonds - - - - - - 173,250 173,250 Issuance cost on Tier 1 perpetual bonds - - - - (1,101) (1,101) - (1,101) Balance at 31 December 2025 162,595 34,465 54,198 20,722 329,739 601,719 398,287 1,000,006 The attached notes 1 to 31 form part of the condensed consolidated interim financial statement
Page 16
- 6 - NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS As at 30 June 2026 (unaudited) 1 LEGAL STATUS AND PRINCIPAL ACTIVITIES Nation al Bank of Oman SAOG ("NBO", "the Bank") was established in the Sultanate of Oman in 1973 as a joint stock company and is engaged in retail, wholesale, investment and Islamic banking services within the Sultanate of Oman, through overseas branches in the U nited Arab Emirates and Egypt. In Oman the Bank operates under banking license issued by the Central Bank of Oman and is covered by its deposit insurance scheme, whereas in the United Arab Emirates and in Egypt the branches operate under a commercial bank licences given by the respective Central Banks. The Bank is in the process of closing down its operations in Egypt and has sought necessary approvals. The Bank is head quartered in Muscat, Sultanate of Oman and its registered address is PO Box 751, Ruwi, Postal Code 112, Muscat, Sultanate of Oman. The Bank’s equity shares are listed on the Muscat Stock Exchange. Perpetual bonds are listed on the Euronext Dublin. Financial Services Authority of the Sultanate of Oman requires all Public Joint Stock Companie s to disclose the financials of the Parent Company in a separate column in the condensed consolidated financial interim statements vide circular E/2/2007 dated 21 January 2007. The Bank has the following fully owned Special Purpose Vehicles (“SPV”): Name of the entity Country of incorporation Activity of the subsidiary Percentage of ownership 2026 2025 NBO Global Markets Cayman Limited Cayman Islands Financial services 100% 100% The size, operations and financial statements of the above SPV are not material to the condensed consolidated financial interim statements of the Bank. Hence, financial statements of the parent company have not been provided in a separate column in these condensed consolidated financial interim statements. 2 MATERIAL ACCOUNTING POLICIES The condensed consolidated interim financial statements of the Bank are prepared in accordance with IFRS Accounting Standard 34, Interim Financial Reporting and the relevant disclosure requirements of the Financial Services Authority (“FSA”) and should be read in conjunction with the Bank’s last annual financial statements as at and for the year ended 31 December 202 5 (‘last annual financial statements’). They do not include all the information required for a complete set of financial statements prepared in accordance with IFRS standards. The condensed consolidated interim financial statements do not contain all information and disclosures required for full financial statements prepared in accordance with International Financial Reporting Standards. In addition, results for the six months ended 30 June 2026 are not necessarily indicative of the results that may be expected for the financial year ending 31 December 2026. The accounting policies used in the preparation of the condensed consolidated interim financial statements are consistent with those used in the preparation of the annual financial statements for the year ended 31 December 2025. The condensed consolidated interim financial statements are prepared in Rial Omani, rounded to the neare st thousands, except as indicated. The functional currencies of the Bank’s operations are as follows: Sultanate of Oman: Rial Omani United Arab Emirates: UAE Dirham Egypt: US Dollar The condensed consolidated interim financial statements are prepared under the historical cost convention, modified to include measurement of derivative financial instruments and certain investments, either through profit and loss account or through other comprehensive Income, at fair value. 2 (a) New and amended IFRS Accounting Standards adopted by the Bank The new standards and amendments to standards that were effective for annual periods beginning from 1 January 202 6 did not have any impact on these condensed consolidated inte rim financial statements of the Bank.
Page 17
- 7 - NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS (CONTINUED) As at 30 June 2026 (unaudited) 2 BASIS OF PREPARATION OF THE CONDENSED CONSOLIDATED INTEIRM FINANCIAL STATEMENTS (continued) 2 (b) Impact of IFRS Accounting Standards issued but not yet applied by the Bank There are certain new accounting standards and amendments to accounting standards have been published that are not mandatory for current reporting period s and have not been early a dopted by the Bank. The Bank is currently assessing the impact of these new standards and amendments is set out below : - IFRS 19 Subsidiaries without Public Accountability: Disclosures (effective for annual periods beginning on or after 1 January 2027) - IFRS 18 Presentation and Disclosure in Financial Statements (effective for annual periods beginning on or after 1 January 2027) 2 (c) Use of estimates and judgements The preparation of the condensed consolidated interim financial statements requires management to make judgments, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets and liabilities, income and ex penses. Actual results may differ from these estimates. The significant judgments made by the Management in applying the Bank’s accounting policies and the key sources of estimation uncertainty were the same as those described in the last annual financial statements. The Bank has robust governance in place to ensure appropriateness of the IFRS 9 framework and resultant Expected Credit Loss (“ECL”) estimates. Specifically, all aspects of the IFRS 9 framework are overseen by the management risk committee. The Bank reviews its individually significant loans and advances at each reporting date to assess whether an impairment loss should be recorded. Judgment by management is required in the estimation of the amount and timing of future cash flows when determini ng the impairment loss. In estimating these cash flows, the Bank makes judgments about the borrower’s financial situation and the net realisable value of collateral. These estimates are based on assumptions about several factors and actual results may diff er, resulting in future changes to the allowance. Loans and advances that have been assessed individually and found not to be impaired and all individually insignificant loans and advances are then assessed collectively, in groups of assets with similar ri sk characteristics, to determine whether provision should be made due to incurred loss events for which there is objective evidence but whose effects are not yet evident. The collective assessment takes account of data from the loan portfolio (such as cred it quality, levels of arrears, credit utilisation, loan to collateral ratios etc.) and concentrations of risks. The Bank incorporates forward -looking information into both its assessment of whether the credit risk of an instrument has increased significant ly since its initial recognition and its measurement of ECL. Based on consideration of a variety of external actual and forecast information, the bank formulates a fundamental view of the future direction of relevant economic variables as well as a reasonable range of possible scenarios. In addition, the Bank continues to review the appropriateness of ECL provisions considering changes in macroeconomic environment, risk profile as well as any actual and expected increase in credit risk. The Bank performs h istorical analysis to determine key economic variables that impact credit risk across different portfolios. Macroeconomic forecasts for these economic variables are used to estimate risk parameters (PD and LGD) on a forward -looking basis for all borrowers and instruments that are in scope of IFRS 9 ECL framework. In accordance with IFRS 9 requirements, the Bank estimates these risk parameters under upside, base and downside scenarios with representative weights used to measure ECL. From a sensitivity anal ysis point of view, if the pessimistic scenario was changed by +10% / - 10%, ECL change would not be material to the condensed consolidated interim financial statements . 3 CASH AND BALANCES WITH CENTRAL BANKS 30/06/2026 30/06/2025 31/12/2025 ’000 ’000 ’000 Cash 32,499 36,542 34,808 Other balances with Central Banks 284,274 247,872 320,846 Cash and cash equivalents 316,773 284,414 355,654 Capital deposit with Central Bank of Oman - 500 500 Cash and balances with Central Banks 316,773 284,914 356,154
Page 18
- 8 - NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS (CONTINUED) As at 30 June 2026 (unaudited) 3 CASH AND BALANCES WITH CENTRAL BANKS (continued) (i) At 30 June 2026, cash and balances with Central Bank of Oman included balances amounting to nil (30 June 2025: 500,000 and 31 December 2025: 500,000) as capital deposit. (ii) Minimum cash reserve to be maintained with Central Bank of Oman as of 30 June 2026 is 3% (30 June and 31 December 2025 – 3%) of total deposits and for Central Bank of UAE, is 1% (30 June and 31 December 2025 – 1%) of time deposits and 14% (30 June and 31 December 2025 – 14%) of all other deposits. (iii) ECL on the cash and balances with Central Banks is not material and accordingly no adjustment has been accounted by the Bank. All the exposures are related to stage 1. 4 DUE FROM BANKS AND OTHER MONEY MARKET PLACEMENTS 30/06/2026 30/06/2025 31/12/2025 ’000 ’000 ’000 Loans and advances to Banks 37,076 38,057 45,680 Placement with Banks 467,333 309,164 255,819 Demand balances 28,005 19,806 33,146 Due from banks and other money market placement 532,414 367,027 334,645 Less: allowance for credit losses (note 22.3) (215) (250) (250) Due from banks and other money market placement 532,199 366,777 334,395 5 LOANS, ADVANCES AND ISLAMIC FINANCING ASSETS 30/06/2026 30/06/2025 31/12/2025 ’000 ’000 ’000 Overdrafts 96,718 87,623 83,544 Personal loans 1,601,387 1,564,536 1,562,701 Term loans, Islamic financing and others 2,935,058 2,587,999 2,681,051 Gross loans, advances and Islamic financing assets for customers 4,633,163 4,240,158 4,327,296 Less: allowance for credit losses (note 22.3) (189,175) (172,554) (176,942) Loans, advances and Islamic financing assets for customers 4,443,988 4,067,604 4,150,354 Gross loans, advances and Islamic financing assets for customers include 113 million due from related parties at 30 June 2026 (30 June 2025 – 122 million, 31 December 2025 – 125 million). Included in above the Islamic financing asset (net of allowance for credit losses) of 389 million as at 30 June 2026 (30 June 2025 – 384 million, 31 December 2025 – 392 million). Provided during the period/year includes contractual interest reserved for 4.68 million (30 June 2025 – 5.11 million and 31 December 2025 – 9.87 million). Recovered/released during the period/year includes recovery of reserved interest at 1.40 million (30 June 2025 – 0.77 million and 31 December 2025 – 1.79 million). All loans and advances require payment of interest based on agreed tenors, some at fixed rates and others at rates that re-price prior to maturity. Contractual interest reserved and recovery thereof is shown under net interest income and income from Islamic financing in the consolidated condensed interim statement of profit or loss. As of 30 June 2026, loans and advances on which interest is not being accrued or where interest has been reserved amounted to 203 million (30 June 2025 – 195 million and 31 December 2025 – 195 million).
Page 19
- 9 - NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS (CONTINUED) As at 30 June 2026 (unaudited) 6 INVESTMENT SECURITIES 30/06/2026 30/06/2025 31/12/2025 ’000 ’000 ’000 Investments measured at Fair value through profit and loss (FVTPL) Quoted investments-Oman 2,795 2,080 2,555 Quoted investments-Foreign - 160 160 Unquoted investments in funds 2,734 2,790 2,805 Total FVTPL investments 5,529 5,030 5,520 Investments measured at Fair value through other comprehensive income (FVOCI) - Equity Quoted investments-Oman 104,462 52,986 66,193 Quoted investments-Foreign 44,871 60,092 30,069 Total FVOCI investments 149,333 113,078 96,262 Investments measured at amortised cost Government development bonds-Oman 344,878 286,337 306,430 Government Sukuk-Oman 46,788 31,838 39,423 Treasury Bills 96,152 96,212 63,232 Quoted investments-Oman 53,863 45,712 53,971 Quoted investments-Foreign 9,037 16,377 16,552 Total – amortised cost 550,718 476,476 479,608 Total investment securities 705,580 594,584 581,390 Less: allowance for credit losses (note 22.3) (1,379) (924) (924) Total investment securities 704,201 593,660 580,466 Details of significant investments Details of investments exceeding 10% of the carrying value of the Bank’s investment portfolio are as follows: Bank’s portfolio Carrying value % ’000 30/06/2026 Government Development Bonds - Oman 56% 391,666 Treasury Bills 14% 96,152 30/06/2025 Government Development Bonds - Oman 54% 318,175 Treasury Bills 16% 96,212 31/12/2025 Government Development Bonds - Oman 60% 345,853 Treasury Bills 11% 63,232 In 2026 (YTD June), the Bank received dividends of 4.74 million from its FVOCI equities (YTD June 2025: 4.27 million for FVOCI equities), recorded as other operating income. Government Sukuk – Oman, Quoted investments – Oman and Quoted investments – Foreign of 83.82 million (30 June 2025 : 19.21 million and 31 December 2025: 80.65 million) are assigned as collateral against USD borrowings of 73.08 million (30 June 2025: 12.63 million and 31 December 2025: 65.23). The Bank designated certain investments as equity securities at FVOCI. The FVOCI designation was made because the investments are expected to be held for strategic purposes rather than with a view to profit on a subsequent sale and there are no plans to dispose of these investments in the short or medium term. This designation is irrevocable.
Page 20
- 10 - NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS (CONTINUED) As at 30 June 2026 (unaudited) 7 OTHER ASSETS 30/06/2026 30/06/2025 31/12/2025 ’000 ’000 ’000 Customers’ indebtedness for acceptances (note 11) 129,809 101,425 84,549 Less: allowance for credit losses (note 22.3) (164) (106) (62) Net Customers’ indebtedness for acceptances 129,645 101,319 84,487 Prepaid expenses and others 18,516 16,805 15,410 Positive fair value of derivatives (note 30) 11,659 9,089 8,980 159,820 127,213 108,877 8 PROPERTY AND EQUIPMENT Freehold land and buildings and leasehold improvements Motor vehicles, furniture and equipment Capital work in progress Right to use assets Total ’000 ’000 ’000 ’000 ’000 Reconciliation of carrying amount: Balance as at 1 January 2026, net of accumulated depreciation 45,038 11,392 2,072 2,476 60,978 Additions 5 1,438 1,121 1,249 3,813 Disposal - - - (24) (24) Transfers 224 466 (690) - - Depreciation (855) (1,704) - (907) (3,466) Balance at 30 June 2026, net of accumulated depreciation 44,412 11,592 2,503 2,794 61,301 At cost 65,526 56,169 2,503 5,019 129,217 Accumulated depreciation (21,114) (44,577) - (2,225) (67,916) Net carrying value at 30 June 2026 44,412 11,592 2,503 2,794 61,301 Reconciliation of carrying amount: Balance as at 1 January 2025, net of accumulated depreciation 46,018 10,643 1,050 1,756 59,467 Additions - 1,055 1,048 1,535 3,638 Disposals (6) (9) - (11) (26) Transfers 272 368 (640) - - Depreciation (832) (1,498) - (861) (3,191) Balance at 30 June 2025, net of accumulated depreciation 45,452 10,559 1,458 2,419 59,888 At cost 65,264 54,507 1,458 4,495 125,724 Accumulated depreciation (19,812) (43,948) - (2,076) (65,836) Net carrying value at 30 June 2025 45,452 10,559 1,458 2,419 59,888 Reconciliation of carrying amount: Balance as at 1 January 2025, net of accumulated depreciation 46,018 10,643 1,050 1,756 59,467 Additions 6 2,440 3,166 2,496 8,108 Disposals - (58) - (11) (69) Transfers 701 1,443 (2,144) - - Depreciation (1,687) (3,076) - (1,765) (6,528) Balance at 31 December 2025, net of accumulated depreciation 45,038 11,392 2,072 2,476 60,978 At cost 65,297 54,306 2,072 5,039 126,714 Accumulated depreciation (20,259) (42,914) - (2,563) (65,736) Net carrying value at 31 December 2025 45,038 11,392 2,072 2,476 60,978
Page 21
- 11 - NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS (CONTINUED) As at 30 June 2026 (unaudited) 9 DUE TO BANKS AND OTHER MONEY MARKET DEPOSITS 30/06/2026 30/06/2025 31/12/2025 ’000 ’000 ’000 Borrowings 484,038 285,138 407,131 Vostro balances 7,304 44,840 7,752 491,342 329,978 414,883 Borrowings include bank borrowings amounting to 73.08 million (30 June 2025 : 12.63 million and 31 December 2025: 65.23 million) with underlying collateral in the form of Government Sukuk – Oman, Quoted investments – Oman and Quoted investments – Foreign of 83.82 million (30 June 2025: 19.21 million and 31 December 2025: 80.65 million). 10 CUSTOMERS’ DEPOSITS 30/06/2026 30/06/2025 31/12/2025 ’000 ’000 ’000 Term deposits 2,085,652 1,983,511 2,006,644 Current accounts 1,874,708 1,630,019 1,389,348 Savings accounts 633,600 591,313 613,125 4,593,960 4,204,843 4,009,117 11 OTHER LIABILITIES 30/06/2026 30/06/2025 31/12/2025 ’000 ’000 ’000 Liabilities under acceptances (note 7) 129,809 101,425 84,549 Other liabilities and accrued expenses 53,449 41,622 38,018 Negative fair value of derivatives (note 30) 9,371 9,371 8,131 Allowances for credit losses for loan commitments and financial guarantees (note 22.3) 6,202 4,630 6,623 Deferred tax liability (note 12) 2,158 3,992 2,006 Lease liabilities 2,044 1,461 1,907 203,033 162,501 141,234
Page 22
- 12 - NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS (CONTINUED) As at 30 June 2026 (unaudited) 12 TAXATION 30/06/2026 30/06/2025 31/12/2025 ’000 ’000 ’000 Tax expenses Current tax expense for the period/year 6,480 5,147 11,519 Deferred tax (44) 788 837 Total tax expenses for the period/year 6,436 5,935 12,356 The Bank is liable to income tax at the following rates: 30/06/2026 30/06/2025 31/12/2025 Sultanate of Oman (of consolidated taxable income) 15% 15% 15% United Arab Emirates (of taxable income) a. National level 9% 9% 9% b. Emirates level 20% 20% 20% Egypt (of taxable income) 22.5% 22.5% 22.5% Set out below is reconciliation between incomes tax calculated on accounting profit with income tax expense for the period: 30/06/2026 30/06/2025 31/12/2025 ’000 ’000 ’000 Accounting profit 45,526 39,960 82,563 Tax at applicable rate 6,829 5,994 12,384 Tax exempt revenues (1,166) (538) (946) Others 817 (309) 81 Total 6,480 5,147 11,519 The Bank's liabilities for taxation in the Sultanate of Oman have been assessed and agreed up to the year ended 31 December 2020. Management believes that additional taxes, if any, in respect of open tax assessments would not be significant to the Bank’s consolidated financial position as at 30 June 2026. The tax assessments of the Egypt operations in respect of the different taxes applicable are at different stages of completion with the respective tax authorities. The Bank’s liability in respect of its branches in UAE has been agreed with the tax authorities up to 31 December 2023. 30/06/2026 30/06/2025 31/12/2025 ’000 ’000 ’000 Income tax liability Through comprehensive income 6,480 5,147 11,519 Through prior years 17,143 12,151 11,857 Through retained earnings - - 2,608 23,623 17,298 25,984 30/06/2026 30/06/2025 31/12/2025 ’000 ’000 ’000 Recognised deferred tax liability Deferred tax liabilities are attributable to the following: Deductible temporary differences relating to provisions 1,965 1,961 2,009 FVOCI investments 193 2,031 (3) 2,158 3,992 2,006 Movement of deferred tax liability 30/06/2026 30/06/2025 31/12/2025 ’000 ’000 ’000 Balance at the beginning of the period/year 2,006 2,169 2,169 (Released)/ provided during the period/year (44) 788 837 Tax effect of movement in FVOCI investments 196 1,035 (1,000) 2,158 3,992 2,006
Page 23
- 13 - NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS (CONTINUED) As at 30 June 2026 (unaudited) 13 OTHER RESERVES FVOCI reserve Impairment Reserve Total ’000 ’000 ’000 At 1 January 2026 5,900 14,822 20,722 Net movement on FVOCI 14,797 - 14,797 Tax effect of net results on FVOCI (196) - (196) At 30 June 2026 20,501 14,822 35,323 At 30 June 2025 3,564 15,877 19,441 At 31 December 2025 5,900 14,822 20,722 The impairment reserve represents excess of impairment allowance (net of tax) calculated as per CBO norms and IFRS 9. The reserve is not available for distribution to the shareholders. 14 TIER 1 PERPETUAL BOND The Bank has issued Perpetual Tier 1 Capital Securities (the “Tier 1 Securities”) with details mentioned in the table below. The Tier 1 Securities constitute direct, unconditional, subordinated and unsecured obligations of the Bank and are classified as equity in accordance with IAS 32: Financial Instruments – Classification. The key features of the instruments are as follows: No fixed date of maturity. Payment of interest and/or capital is solely at the discretion of the Bank . The instruments are deeply subordinated and rank just above the ordinary shareholders These securities also allow the Bank to write -down (in whole or in part) any amounts due to the holders in the event of non-viability with the approval of the Central Bank of Oman. The determination of equity classification of these instruments requires significant judgment as certain clauses, particularly the "Events of Default”, require interpretation. The Directors, after factoring in the clauses relating to the write -down, non -payment and subordination in the instrument offering document, consider that the Bank will not reach the point of insolvency before a write -down is affected due to a non -viability event. Accordingly, such clauses were assessed by the Directors as not being g enuine for the purpose of determining the debt vs equity classification. The Directors have considered appropriate independent legal advice in forming their judgment around this matter. Issuance Month/Year Issued Amount Coupon Rate November 2022 USD 134.11 million ( 51.63 million) Fixed interest rate of 6.75% with a reset after 5 years October 2024 USD 150.40 million ( 57.90 million) Fixed interest rate of 6.75% with a reset after 5 years November 2025 USD 450 million ( 173.3 million) Fixed interest rate of 6.63% with a reset after 5 years These securities form part of Tier 1 Capital of the Bank and comply with Basel -III and Central Bank of Oman regulations (BM 1114).
Page 24
- 14 - NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS (CONTINUED) As at 30 June 2026 (unaudited) 15 CONTINGENT LIABILITIES AND COMMITMENTS 30/06/2026 30/06/2025 31/12/2025 ’000 ’000 ’000 Guarantees 361,227 286,573 331,864 Documentary letters of credit 88,874 52,092 67,122 Undrawn commitment to lend 112,386 103,511 107,086 562,487 442,176 506,072 (i) The allowances for credit losses for commitments and financial guarantees amounts to 6.20 million (30 June 2025 – 4.63 million and 31 December 2025 – 6.62 million) and is included under note 11. (ii) Guarantees include 4.46 million (30 June 2025 – 4.56 million and 31 December 2025 – 4.46 million) relating to non-performing loans. 16 INTEREST INCOME 6 months ended 6 months ended 3 months ended 3 months ended 30/06/2026 30/06/2025 30/06/2026 30/06/2025 ’000 ’000 ’000 ’000 Interest from customers 107,002 103,134 54,287 51,348 Interest from investments 12,345 11,627 6,258 5,985 Interest from banks 4,708 6,147 2,500 3,075 124,055 120,908 63,045 60,408 17 INTEREST EXPENSE 6 months ended 6 months ended 3 months ended 3 months ended 30/06/2026 30/06/2025 30/06/2026 30/06/2025 ’000 ’000 ’000 ’000 Interest to customer 61,283 65,565 30,964 32,650 Interest to banks 8,075 5,787 4,421 2,415 69,358 71,352 35,385 35,065 18 FEE AND COMMISSION INCOME 6 months ended 6 months ended 3 months ended 3 months ended 30/06/2026 30/06/2025 30/06/2026 30/06/2025 ’000 ’000 ’000 ’000 Fee and commission income 21,914 21,440 12,064 11,490 Less: fee and commission expenses (9,276) (7,699) (4,878) (4,184) Net fee and commission income 12,638 13,741 7,186 7,306 The disaggregation of fee and commission income is provided under note 2 8. 19 OTHER OPERATING INCOME 6 months ended 6 months ended 3 months ended 3 months ended 30/06/2026 30/06/2025 30/06/2026 30/06/2025 ’000 ’000 ’000 ’000 Income from investment securities 9,381 4,465 1,479 441 Net gain from foreign exchange and derivatives 7,066 5,521 4,814 3,145 Miscellaneous income 2,247 2,377 1,124 1,141 18,694 12,363 7,417 4,727
Page 25
- 15 - NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS (CONTINUED) As at 30 June 2026 (unaudited) 20 STAFF COST 6 months ended 6 months ended 3 months ended 3 months ended 30/06/2026 30/06/2025 30/06/2026 30/06/2025 ’000 ’000 ’000 ’000 Employees' salaries 14,752 14,461 7,372 7,210 Contribution to social insurance schemes 1,418 1,460 745 725 Other staff costs 5,096 4,452 2,475 2,143 21,266 20,373 10,592 10,078 The Bank employed 1,409 employees as of 30 June 2026 (30 June 2025 – 1,405). 21 OTHER OPERATING EXPENSES 6 months ended 6 months ended 3 months ended 3 months ended 30/06/2026 30/06/2025 30/06/2026 30/06/2025 ’000 ’000 ’000 ’000 Establishment costs 1,983 1,843 1,052 924 Operating and administration expenses 8,612 6,761 4,520 3,468 Directors’ remuneration and sitting fees 220 214 105 102 10,815 8,818 5,677 4,494
Page 26
- 16 - NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS (CONTINUED) As at 30 June 2026 (unaudited) 22 CLASSIFICATION AND MEASUREMENT OF FINANCIAL INSTRUMENTS 22.1 Comparison of impairment provisions in accordance with IFRS 9 and regulatory provision under Central Bank of Oman’s (CBO) requirement: Impairment charge and provision held as of 30 June 2026 Amounts in ’000 As per CBO Norms As per IFRS 9 Difference Impairment Loss charged to profit and loss - 9,813 NA Provisions required as per CBO norms/ held as per IFRS 9 218,798 197,135 (21,663) Gross non-performing loan ratio (percentage) - 4.4 - Net non-performing loan ratio (percentage) - 3.6 - Mapping of IFRS 9 and CBO norms as of 30 June 2026 Amounts in ’000 Asset Classification as per CBO Norms Asset Classificatio n as per IFRS 9 Gross Amount Provision required as per CBO Norms Provision held as per IFRS 9 Difference between CBO provision required and provision held under IFRS 9 Net Amount as per IFRS 9 Reserve interest as per CBO norms (1) (2) (3) (4) (5) (6) = (4)-(5)+(8) (7) = (3)-(5) (8) Standard Stage 1 3,971,936 49,970 11,204 38,766 3,960,732 - Stage 2 262,291 2,960 8,385 (5,425) 253,906 - Stage 3 - - - - - - Subtotal 4,234,227 52,930 19,589 33,341 4,214,638 - Special Mention Stage 1 - - - - - - Stage 2 195,861 1,990 29,205 (27,215) 166,656 - Stage 3 - - - - - - Subtotal 195,861 1,990 29,205 (27,215) 166,656 - Substandard Stage 1 - - - - - - Stage 2 - - - - - - Stage 3 7,840 1,950 4,327 (2,235) 3,513 142 Subtotal 7,840 1,950 4,327 (2,235) 3,513 142 Doubtful Stage 1 - - - - - - Stage 2 - - - - - - Stage 3 13,377 6,177 5,051 1,568 8,326 442 Subtotal 13,377 6,177 5,051 1,568 8,326 442 Loss Stage 1 - - - - - - Stage 2 - - - - - - Stage 3 181,858 119,161 131,003 24,164 50,855 36,006 Subtotal 181,858 119,161 131,003 24,164 50,855 36,006 Other items not covered under CBO circular BM 977 and related instructions Stage 1 1,853,311 - 2,659 (2,659) 1,850,652 - Stage 2 201,936 - 1,093 (1,093) 200,843 - Stage 3 4,455 - 4,208 (4,208) 247 - Subtotal 2,059,702 - 7,960 (7,960) 2,051,742 - Total Stage 1 5,825,247 49,970 13,863 36,107 5,811,384 - Stage 2 660,088 4,950 38,683 (33,733) 621,405 - Stage 3 207,530 127,288 144,589 19,289 62,941 36,590 Total 6,692,865 182,208 197,135 21,663 6,495,730 36,590
Page 27
- 17 - NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS (CONTINUED) As at 30 June 2026 (unaudited) 22 CLASSIFICATION AND MEASUREMENT OF FINANCIAL INSTRUMENTS (continued) 22.1 Comparison of impairment provisions in accordance with IFRS 9 and regulatory provision under Central Bank of Oman’s (CBO) requirement (continued): Impairment charge and provision held as of 30 June 2025 Amounts in ’000 As per CBO Norms As per IFRS 9 Difference Impairment Loss charged to profit and loss - 7,097 N.A. Provisions required as per CBO norms/ held as per IFRS 9 197,143 178,464 (18,679) Gross non-performing loan ratio (percentage) - 4.6 - Net non-performing loan ratio (percentage) - 3.9 - Mapping of IFRS 9 and CBO norms as of 30 June 2025 Amounts in ’000 Asset Classification as per CBO Norms Asset Classification as per IFRS 9 Gross Amount Provision required as per CBO Norms Provision held as per IFRS 9 Difference between CBO provision required and provision held under IFRS 9 Net Amount as per IFRS 9 Reserve interest as per CBO norms (1) (2) (3) (4) (5) (6) = (4)-(5)+(8) (7) = (3)-(5) (8) Standard Stage 1 3,471,436 44,758 10,494 34,264 3,460,942 - Stage 2 374,565 4,181 11,499 (7,318) 363,066 - Stage 3 - - - - - - Subtotal 3,846,001 48,939 21,993 26,946 3,824,008 - Special Mention Stage 1 - - - - - - Stage 2 199,635 2,039 22,452 (20,413) 177,183 - Stage 3 - - - - - - Subtotal 199,635 2,039 22,452 (20,413) 177,183 - Substandard Stage 1 - - - - - - Stage 2 - - - - - - Stage 3 6,872 1,707 1,958 (138) 4,914 113 Subtotal 6,872 1,707 1,958 (138) 4,914 113 Doubtful Stage 1 - - - - - - Stage 2 - - - - - - Stage 3 31,898 14,991 23,879 (7,324) 8,019 1,564 Subtotal 31,898 14,991 23,879 (7,324) 8,019 1,564 Loss Stage 1 - - - - - - Stage 2 - - - - - - Stage 3 155,752 99,052 102,272 25,518 53,480 28,738 Subtotal 155,752 99,052 102,272 25,518 53,480 28,738 Other items not covered under CBO circular BM 977 and related instructions Stage 1 1,379,825 - 1,611 (1,611) 1,378,214 - Stage 2 250,593 - 3,159 (3,159) 247,434 - Stage 3 4,558 - 1,140 (1,140) 3,418 - Subtotal 1,634,976 - 5,910 (5,910) 1,629,066 - Total Stage 1 4,851,261 44,758 12,105 32,653 4,839,156 - Stage 2 824,793 6,220 37,110 (30,890) 787,683 - Stage 3 199,080 115,750 129,249 16,916 69,831 30,415 Total 5,875,134 166,728 178,464 18,679 5,696,670 30,415
Page 28
- 18 - NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS (CONTINUED) As at 30 June 2026 (unaudited) 22 CLASSIFICATION AND MEASUREMENT OF FINANCIAL INSTRUMENTS (continued) 22.2 Comparison of impairment provisions in accordance with IFRS 9 and regulatory provision under Central Bank of Oman’s (CBO) requirement: Restructured loans as at 30 June 2026 Amounts in ’000 Asset classification as per CBO’s Norms Asset classificatio n as per IFRS 9 Gross carrying amount Provision required as per CBO’s norms Provision held as per IFRS 9 Difference between CBO provision required and provision held under IFRS 9 Net carrying amount as per IFRS 9 Reserve interest as per CBO’s norms (1) (2) (3) (4) (5) (6) = (4)-(5)+(8) (7) = (3)-(5) (8) Classified as performing Stage 1 - - - - - - Stage 2 114,820 1,184 26,219 (25,035) 88,601 - Stage 3 - - - - - - Subtotal 114,820 1,184 26,219 (25,035) 88,601 - Classified as non- performing Stage 1 - - - - - - Stage 2 - - - - - - Stage 3 53,589 34,581 35,236 3,623 18,353 4,278 Sub total 53,589 34,581 35,236 3,623 18,353 4,278 Total Stage 1 - - - - - - Stage 2 114,820 1,184 26,219 (25,035) 88,601 - Stage 3 53,589 34,581 35,236 3,623 18,353 4,278 Total 168,409 35,765 61,455 (21,412) 106,954 4,278 Restructured loans as at 30 June 2025 Amounts in ’000 Asset classification as per CBO’s Norms Asset classificatio n as per IFRS 9 Gross carrying amount Provision required as per CBO’s norms Provision held as per IFRS 9 Difference between CBO provision required and provision held under IFRS 9 Net carrying amount as per IFRS 9 Reserve interest as per CBO’s norms (1) (2) (3) (4) (5) (6) = (4)-(5)+(8) (7) = (3)-(5) (8) Classified as performing Stage 1 - - - - - - Stage 2 193,767 2,330 24,430 (22,100) 169,337 - Stage 3 - - - - - - Subtotal 193,767 2,330 24,430 (22,100) 169,337 - Classified as non- performing Stage 1 - - - - - - Stage 2 - - - - - - Stage 3 60,457 30,342 43,270 (7,508) 17,187 5,420 Sub total 60,457 30,342 43,270 (7,508) 17,187 5,420 Total Stage 1 - - - - - - Stage 2 193,767 2,330 24,430 (22,100) 169,337 - Stage 3 60,457 30,342 43,270 (7,508) 17,187 5,420 Total 254,224 32,672 67,700 (29,608) 186,524 5,420
Page 29
- 19 - NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS (CONTINUED) As at 30 June 2026 (unaudited) 22 CLASSIFICATION AND MEASUREMENT OF FINANCIAL INSTRUMENTS (continued) 22.3 Movement in Expected credit losses (ECL) As at 30 June 2026 Stage 1 Stage 2 Stage 3 Total ’ 000 ’ 000 ’ 000 ’ 000 Exposure subject to ECL - Central bank balances 284,274 - - 284,274 - Due from banks and other money market placements 532,414 - - 532,414 - Loans, advances and Islamic financing assets 3,971,936 458,152 203,075 4,633,163 - Investment securities (debt) 550,718 - - 550,718 - Acceptances 75,346 54,463 - 129,809 - Contingent liabilities and commitments 410,559 147,473 4,455 562,487 5,825,247 660,088 207,530 6,692,865 Opening Balance - as at 1 January 2026 - Central bank balances - - - - - Due from banks and other money market placements 250 - - 250 - Loans, advances and Islamic financing assets 8,972 35,216 132,754 176,942 - Investment securities (debt) 924 - - 924 - Acceptances 14 48 - 62 - Contingent liabilities and commitments 728 1,707 4,188 6,623 10,888 36,971 136,942 184,801 Net transfer between stages - Central bank balances - - - - - Due from banks and other money market placements - - - - - Loans, advances and Islamic financing assets 1,919 (2,080) 161 - - Investment securities (debt) - - - - - Acceptances (4) 4 - - - Contingent liabilities and commitments 36 (36) - - 1,951 (2,112) 161 - Charge / (release) for the period (net) - Central bank balances - - - - - Due from banks and other money market placements (35) - - (35) - Loans, advances and Islamic financing assets 313 4,454 10,460 15,227 - Investment securities (debt) 455 - - 455 - Acceptances 34 68 - 102 - Contingent liabilities and commitments 257 (698) 20 (421) 1,024 3,824 10,480 15,328 Write off for the period - Loans, advances and Islamic financing assets - - (2,994) (2,994) - - (2,994) (2,994) Closing Balance - as at 30 June 2026 - Central bank balances - - - - - Due from banks and other money market placements 215 - - 215 - Loans, advances and Islamic financing assets 11,204 37,590 140,381 189,175 - Investment securities (debt) 1,379 - - 1,379 - Acceptances 44 120 - 164 - Contingent liabilities and commitments 1,021 973 4,208 6,202 13,863 38,683 144,589 197,135
Page 30
- 20 - NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS (CONTINUED) As at 30 June 2026 (unaudited) 22 CLASSIFICATION AND MEASUREMENT OF FINANCIAL INSTRUMENTS (continued) 22.3 Movement in Expected credit losses (ECL) (continued) As at 30 June 2025 Stage 1 Stage 2 Stage 3 Total ’ 000 ’ 000 ’ 000 ’ 000 Exposure subject to ECL - Central bank balances 247,872 - - 247,872 - Due from banks and other money market placements 367,027 - - 367,027 - Loans, advances and Islamic financing assets 3,471,436 574,200 194,522 4,240,158 - Investment securities (debt) 476,476 - - 476,476 - Acceptances 34,483 66,942 - 101,425 - Contingent liabilities and commitments 253,967 183,651 4,558 442,176 4,851,261 824,793 199,080 5,875,134 Opening Balance - as at 1 January 2025 - Central bank balances - - - - - Due from banks and other money market placements 106 - - 106 - Loans, advances and Islamic financing assets 10,573 32,716 121,270 164,559 - Investment securities (debt) 559 - - 559 - Acceptances 93 127 - 220 - Contingent liabilities and commitments 325 2,491 1,231 4,047 11,656 35,334 122,501 169,491 Net transfer between stages - Central bank balances - - - - - Due from banks and other money market placements - - - - - Loans, advances and Islamic financing assets (151) (77) 228 - - Investment securities (debt) - - - - - Acceptances - - - - - Contingent liabilities and commitments 337 (337) - - 186 (414) 228 - Charge / (release) for the period (net) - Central bank balances - - - - - Due from banks and other money market placements 144 - - 144 - Loans, advances and Islamic financing assets 72 1,312 12,121 13,505 - Investment securities (debt) 365 - - 365 - Acceptances (69) (45) - (114) - Contingent liabilities and commitments (249) 923 (91) 583 263 2,190 12,030 14,483 Write off for the period - Loans, advances and Islamic financing assets - - (5,510) (5,510) - - (5,510) (5,510) Closing Balance - as at 30 June 2025 - Central bank balances - - - - - Due from banks and other money market placements 250 - - 250 - Loans, advances and Islamic financing assets 10,494 33,951 128,109 172,554 - Investment securities (debt) 924 - - 924 - Acceptances 24 82 - 106 - Contingent liabilities and commitments 413 3,077 1,140 4,630 12,105 37,110 129,249 178,464
Page 31
- 21 - NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS (CONTINUED) As at 30 June 2026 (unaudited) 22 CLASSIFICATION AND MEASUREMENT OF FINANCIAL INSTRUMENTS (continued) 22.4 Movement in loans As at 30 June 2026 Stage 1 Stage 2 Stage 3 Total ’ 000 ’ 000 ’ 000 ’ 000 Exposure subject to ECL Opening Balance - as at 1 January 2026 3,549,929 582,483 194,884 4,327,296 Transfer to stage 1 154,167 (154,167) - - Transfer to stage 2 (6,305) 6,707 (402) - Transfer to stage 3 (2,927) (15,654) 18,581 - New loans, advances and Islamic financing assets 323,385 120,609 - 443,994 Recovery of loans, advances and Islamic financing assets (46,313) (81,826) (6,994) (135,133) Write off for the period - - (2,994) (2,994) Closing Balance - as at 30 June 2026 3,971,936 458,152 203,075 4,633,163 As at 30 June 2025 Stage 1 Stage 2 Stage 3 Total ’ 000 ’ 000 ’ 000 ’ 000 Exposure subject to ECL Opening Balance - as at 1 January 2025 3,342,348 557,782 190,576 4,090,706 Transfer to stage 1 5,063 (5,063) - - Transfer to stage 2 (18,313) 18,518 (205) - Transfer to stage 3 (13,271) (3,453) 16,724 - New loans, advances and Islamic financing assets 193,253 19,211 - 212,464 Recovery of loans, advances and Islamic financing assets (37,644) (12,795) (7,063) (57,502) Write off for the period - - (5,510) (5,510) Closing Balance - as at 30 June 2025 3,471,436 574,200 194,522 4,240,158 22.5 Total impairment losses on financial instruments (net) 6 months ended 6 months ended 3 months ended 3 months ended 30/06/2026 30/06/2025 30/06/2026 30/06/2025 ’000 ’000 ’000 ’000 Impairment of allowances for credit losses: Due from banks and other money market placements 35 (144) 48 (92) Loans, advances and Islamic financing assets (13,604) (11,022) (6,234) (4,910) Investment securities (debt) (455) (365) (261) (350) Acceptances (102) 114 (109) (32) Contingent liabilities and commitments 421 (583) 290 (692) Total (13,705) (12,000) (6,266) (6,076) Recoveries and releases from: Provision for credit losses 1,654 1,857 717 1,111 Loans, advances and Islamic financing assets written off 2,238 3,046 1,320 1,677 Total 3,892 4,903 2,037 2,788 Net Impairment losses (9,813) (7,097) (4,229) (3,288)
Page 32
- 22 - NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS (CONTINUED) As at 30 June 2026 (unaudited) 23 EARNINGS PER SHARE Basic earnings per share are calculated by dividing the profit for the period after interest on perpetual tier 1 capital, by the weighted average number of shares outstanding during the period as follows: 6 months ended 6 months ended 3 months ended 3 months ended 30/06/2026 30/06/2025 30/06/2026 30/06/2025 Net profit after tax (’000s) 39,090 34,025 19,624 16,944 Less: Interest on tier 1 perpetual bond (’000s) (14,056) (8,316) (14,056) (8,316) Profit attributable to shareholders (’000s) 25,034 25,709 5,568 8,628 Weighted average number of shares outstanding during the period (in ’000s) 1,625,946 1,625,946 1,625,946 1,625,946 Basic earnings per share () 0.015 0.016 0.003 0.005 There are no instruments that are dilutive in nature, hence the basic and diluted earnings per share are same for both the period. Interest on Perpetual Tier I capital is adjusted in computation of earnings per share on payment basis.
Page 33
- 23 - NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS (CONTINUED) As at 30 June 2026 (unaudited) 24 ASSETS/ LIABILITIES MISMATCH The residual maturity behavioral of the assets, liabilities and equity at 30 June 2026 is as follows: On demand within 3 months 3 to 12 months Subtotal less than 12 months 1 to 5 years Over 5 years Subtotal over 12 months Total ’000 ’000 ’000 ’000 ’000 ’000 ’000 Cash and balances with Central Banks 166,442 62,460 228,902 63,474 24,397 87,871 316,773 Due from Banks and other money market placements 493,699 15,400 509,099 23,100 - 23,100 532,199 Loans, advances and Islamic financing assets 429,048 334,054 763,102 1,548,074 2,132,812 3,680,886 4,443,988 Investment securities 266,153 10,936 277,089 285,277 141,835 427,112 704,201 Other assets 154,792 5,010 159,802 18 - 18 159,820 Property and equipment - - - - 61,301 61,301 61,301 Total assets 1,510,134 427,860 1,937,994 1,919,943 2,360,345 4,280,288 6,218,282 Future interest cash inflows 68,715 178,110 246,825 708,421 316,758 1,025,179 1,272,004 Due to Banks and other money market deposits 180,237 234,105 414,342 77,000 - 77,000 491,342 Customers’ deposits 931,124 1,739,590 2,670,714 1,262,843 660,403 1,923,246 4,593,960 Other liabilities 174,180 28,086 202,266 122 645 767 203,033 Taxation 23,623 - 23,623 - - - 23,623 Shareholders’ equity - - - - 623,537 623,537 623,537 Tier 1 perpetual bonds - - - - 282,787 282,787 282,787 Total liabilities and shareholders’ equity 1,309,164 2,001,781 3,310,945 1,339,965 1,567,372 2,907,337 6,218,282 Future interest cash outflows 43,921 91,159 135,080 256,401 102,820 359,221 494,301 Total liquidity gap (total assets – total liabilities and shareholders’ equity 200,970 (1,573,921) (1,372,951) 579,978 792,973 1,372,951 -
Page 34
- 24 - NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS (CONTINUED) As at 30 June 2026 (unaudited) 24 ASSETS/ LIABILITIES MISMATCH (continued) The residual maturity behavioral of the assets, liabilities and equity at 30 June 2025 is as follows: On demand within 3 months 3 to 12 months Subtotal less than 12 months 1 to 5 years Over 5 years Subtotal over 12 months Total ’000 ’000 ’000 ’000 ’000 ’000 ’000 Cash and balances with Central Banks 139,520 48,238 187,758 64,146 33,010 97,156 284,914 Due from Banks and other money market placements 294,068 52,688 346,756 14,246 5,775 20,021 366,777 Loans, advances and Islamic financing assets 325,742 376,709 702,451 1,364,008 2,001,145 3,365,153 4,067,604 Investment securities 226,572 31,865 258,437 261,192 74,031 335,223 593,660 Other assets 121,575 5,638 127,213 - - - 127,213 Property and equipment - - - - 59,888 59,888 59,888 Total assets 1,107,477 515,138 1,622,615 1,703,592 2,173,849 3,877,441 5,500,056 Future interest cash inflows 60,369 158,763 219,132 634,200 294,626 928,826 1,147,958 Due to Banks and other money market deposits 215,718 5,775 221,493 108,485 - 108,485 329,978 Customers’ deposits 759,079 1,139,177 1,898,256 1,471,461 835,126 2,306,587 4,204,843 Other liabilities 139,421 21,843 161,264 54 1,183 1,237 162,501 Taxation 17,298 - 17,298 - - - 17,298 Shareholders’ equity - - - - 560,399 560,399 560,399 Tier 1 perpetual bonds - - - - 225,037 225,037 225,037 Total liabilities and shareholders’ equity 1,131,516 1,166,795 2,298,311 1,580,000 1,621,745 3,201,745 5,500,056 Future interest cash outflows 41,429 94,618 136,047 304,591 117,358 421,949 557,996 Total liquidity gap (total assets – total liabilities and sharedholders’ equity (24,039) (651,657) (675,696) 123,592 552,104 675,696 -
Page 35
- 25 - NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS (CONTINUED) As at 30 June 2026 (unaudited) 24 ASSETS/ LIABILITIES MISMATCH (continued) The residual maturity behavioral of the assets, liabilities and equity at 31 December 202 5 is as follows: On demand within 3 months 3 to 12 months Subtotal Less than 12 months 1 to 5 years Over 5 years Subtotal Over 12 months Total ’000 ’000 ’000 ’000 ’000 ’000 ’000 Cash and balances with Central Banks 192,385 56,856 249,241 75,092 31,821 106,913 356,154 Due from banks and other money market placements 235,758 36,056 271,814 62,581 - 62,581 334,395 Loans, advances and Islamic financing assets 327,989 375,962 703,951 1,552,087 1,894,316 3,446,403 4,150,354 Investment securities 183,183 35,526 218,709 256,303 105,454 361,757 580,466 Other assets 104,685 4,192 108,877 - - - 108,877 Property and equipment - - - - 60,978 60,978 60,978 Total assets 1,044,000 508,592 1,552,592 1,946,063 2,092,569 4,038,632 5,591,224 Future interest cash inflows 66,521 175,248 241,769 672,639 288,353 960,992 1,202,761 Due to banks and other money market deposits 228,995 160,863 389,858 25,025 - 25,025 414,883 Customers’ deposits 696,101 1,228,476 1,924,577 1,323,320 761,220 2,084,540 4,009,117 Other liabilities 135,063 5,060 140,123 64 1,047 1,111 141,234 Taxation 25,984 - 25,984 - - - 25,984 Shareholders’ equity - - - - 601,719 601,719 601,719 Tier 1 perpetual bonds - - - - 398,287 398,287 398,287 Total liabilities and shareholders’ equity 1,086,143 1,394,399 2,480,542 1,348,409 1,762,273 3,110,682 5,591,224 Future interest cash outflows 43,217 96,927 140,144 317,474 138,076 455,550 595,694 Total liquidity gap (total assets – total liabilities and shareholders’ equity (42,143) (885,807) (927,950) 597,654 330,296 927,950 -
Page 36
- 26 - NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS (CONTINUED) As at 30 June 2026 (unaudited) 24 ASSETS/ LIABILITIES MISMATCH (continued) The tables below analyse s the Bank’s financial liabilities into relevant maturity groupings based on their contractual maturities . Where there are no contractual maturities, the balances are considered as "Due on demand". 30 June 2026 On demand within 3 months 3 to 12 months Subtotal less than 12 months 1 to 5 years Over 5 years Subtotal over 12 months Total ’000 ’000 ’000 ’000 ’000 ’000 ’000 Customers’ deposits 2,839,514 1,322,219 4,161,733 432,227 - 432,227 4,593,960 Due to Banks and other money market deposits 180,237 234,105 414,342 77,000 - 77,000 491,342 Other liabilities 174,180 28,086 202,266 122 645 767 203,033 Future interest cash outflows 43,921 91,159 135,080 256,401 102,820 359,221 494,301 Contingent liabilities 545,001 - 545,001 - - - 545,001 30 June 2025 Customers’ deposits 2,508,590 833,086 3,341,676 863,114 53 863,167 4,204,843 Due to Banks and other money market deposits 215,718 5,775 221,493 108,485 - 108,485 329,978 Other liabilities 139,421 21,843 161,264 54 1,183 1,237 162,501 Future interest cash outflows 41,429 94,618 136,047 304,591 117,358 421,949 557,996 Contingent liabilities 442,176 - 442,176 - - - 442,176 31 December 2025 Customers’ deposits 2,279,105 977,417 3,256,522 752,595 - 752,595 4,009,117 Due to Banks and other money market deposits 228,995 160,863 389,858 25,025 - 25,025 414,883 Other liabilities 135,063 5,060 140,123 64 1,047 1,111 141,234 Future interest cash outflows 43,219 96,927 140,146 317,474 138,076 455,550 595,696 Contingent liabilities 506,072 - 506,072 - - - 506,072
Page 37
- 27 - NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS (CONTINUED) As at 30 June 2026 (unaudited) 25 RELATED PARTY TRANSACTIONS Parties are considered to be related if one party has the ability to control the other party or exercise significant influence over the other party in making financial or operational decisions. Related parties comprise principal shareholders, directors and key management personnel of the Bank. Key management personnel comprise those individuals of the Bank who are involved in the strategic planning and decision making of the Bank. The terms of these transactions are approved by the Bank’s management and are made on terms agreed by the Board of Directors. In the ordinary course of business, the Bank conducts transactions with certain of its directors, shareholders, senior management and companies over which they have significant interest. The Bank engages in transactions with related parties at arm's length terms and in accordance with relevant laws and regulations. Terms of these transactions are approved by the Bank's Board and Management. Principal shareholders of the Bank includes those shareholdes who exercises significant influence on the Bank and their close family members. Other related parties include transactions with key management personnel, directors and transactions with those entities which are controlled by either the principal shareholders or key management personnel or directors of the Bank. The aggregate amounts of balances with such related parties are as follows: 30/06/2026 31/12/2025 Principal shareholder Others Total Principal shareholder Others Total ’000 ’000 ’000 ’000 ’000 ’000 Loans, advances and Islamic financing assets - 113,334 113,334 - 124,728 124,728 Customers' deposits 352 47,090 47,442 341 40,863 41,204 Due from banks 495 - 495 218 - 218 Due to banks 167 - 167 145 - 145 Letters of credit, guarantees and acceptances 1,102 7,354 8,456 954 4,618 5,572 Investments 2,599 1,231 3,830 2,831 1,174 4,005 The statement of comprehensive income includes the following amounts in relation to transactions with related parties: 30/06/2026 30/06/2025 Principal shareholder Others Total Principal shareholder Others Total ’000 ’000 ’000 ’000 ’000 ’000 Interest income - 3,257 3,257 11 3,231 3,242 Commission income 4 186 190 2 203 205 Interest expense - 469 469 - 520 520 Other expenses - 533 533 - 570 570 Details regarding senior management are set out below: The Bank considers the personnel of Management Executive Committee to be key management personnel for the purposes of IAS 24 ‘Related Party Disclosures.” The balances in respect of these related parties included in the statement of financial position as at the reporting date are as follows: 30/06/2026 ’000 31/12/2025 ’000 Loans, advances and Islamic financing assets 565 458 Customers’ deposits 1,872 1,642
Page 38
- 28 - NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS (CONTINUED) As at 30 June 2026 (unaudited) 25 RELATED PARTY TRANSACTIONS (continued) The income and expenses in respect of these related parties included in the financial statement are as follows: 6 months ended 6 months ended 30/06/2026 30/06/2025 ’000 ’000 Interest Income 14 18 Interest Expense 36 37 Salaries and other short-term benefits 2,764 2,978 Post-employment benefits 100 74 26 SHAREHOLDERS The shareholders of the Bank who own 10% or more of the Bank’s shares, based on information obtained from Muscat Clearing and Depository. 30/06/2026 30/06/2025 31/12/2025 Number of shares held (’000) The Commercial Bank of Qatar 567,453 567,453 567,453 Suhail Salim Abdullah Al Mukhaini Bahwan 239,805 239,805 239,805 % of shareholding The Commercial Bank of Qatar 34.90% 34.90% 34.90% Suhail Salim Abdullah Al Mukhaini Bahwan 14.75% 14.75% 14.75% The percentage shareholding is calculated based on the total shares of the Bank outstanding at the reporting date. 27 CAPITAL ADEQUACY The risk asset ratio calculated in accordance with the capital adequacy guidelines of the Bank for International Settlement is as follows: 30/06/2026 30/06/2025 31/12/2025 ’000 ’000 ’000 Capital base Common equity Tier 1 546,683 493,275 559,107 Eligible additional Tier 1 - capital 282,787 225,037 398,287 Tier 2 capital 24,275 20,769 15,711 Total capital base 853,745 739,081 973,105 Risk weighted assets Credit risk 4,490,796 4,020,610 4,346,825 Operational risk 287,929 272,144 287,929 Market risk 106,038 165,888 127,638 Total risk weighted assets 4,884,763 4,458,642 4,762,392 Common Equity Tier 1 Ratio 11.2% 11.1% 11.7% Tier 1 Ratio 17.0% 16.1% 20.1% Risk asset ratio (Basel II norms) 17.5% 16.6% 20.4%
Page 39
- 29 - NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS (CONTINUED) As at 30 June 2026 (unaudited) 28 SEGMENT REPORTING For management purposes, the Bank is organised into five operating segments based on business units and are as follows: - Retail Banking offers various products and facilities to individual retail and high net -worth customers to meet everyday banking needs. This includes asset products like personal loans, housing loan, credit cards and term loans and liability products like savings account, current account and term deposits. - Wholesale Banking delivers a variety of products and services to Corporate, Government and Financial Institutions, that include lending, accepting deposits, trade finance, treasury and foreign exchange . It also includes investment Banking which offers investment products such as asset management, corporate advisory and brokerage services to retail customers and institutional clients. - International operations include UAE and Egypt operations. - Islamic Banking offers various products as per Shari’a principles. - Funding Center – The Funding center is responsible for balancing and managing the liquidity of funds within the Bank. It acts as repository of funds by allocating funds transfer pricing to various business units for performance management purposes. The department also handles the Bank's investments in securities, asset/liability management and cash instruments. Management monitors the operating results of these segments separately for the purpose of making decisions about resource allocation and performance assessment. The costs incurred by the support functions are allocated to operating segments for performance measurement purposes. Segment information by business line is as follows: Retail Banking Wholesale Banking International Banking Islamic Banking Funding center Total ’000 ’000 ’000 ’000 ’000 ’000 30 June 2026 Operating income 30,453 42,532 3,766 6,052 8,083 90,886 Net profit 9,574 20,134 761 1,169 7,452 39,090 Total assets 1,551,236 3,313,040 348,282 521,001 484,723 6,218,282 30 June 2025 Operating income 30,027 34,394 2,959 5,185 6,874 79,439 Net profit 7,881 19,213 130 648 6,153 34,025 Total assets 1,509,468 2,869,713 219,705 538,728 362,442 5,500,056 Disaggregated revenues IFRS 15 requires the disclosure of disaggregated revenue from contracts with customers for m ajor products / service lines. The below table provides disaggregation of commission and fee income (net) into revenues within Bank’s reportable segments. Contract revenue is further segregated based on the products and services: 30 June 2026 Retail Wholesale International Islamic Total ’000 ’000 ’000 ’000 ’000 Transactional 4,470 - - 63 4,533 Trade Income 18 1,738 190 34 1,980 Account Services 96 468 (6) - 558 Underwriting & Syndication 349 3,608 207 258 4,422 Investment banking - 1,145 - - 1,145 Total 4,933 6,959 391 355 12,638
Page 40
- 30 - NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS (CONTINUED) As at 30 June 2026 (unaudited) 28 SEGMENT REPORTING (continued) Disaggregated revenues (continued) 30 June 2025 Retail Wholesale International Islamic Total ’000 ’000 ’000 ’000 ’000 Transactional 5,377 - 2 17 5,396 Trade Income 31 1,259 131 39 1,460 Account Services 10 754 (6) 22 780 Underwriting & Syndication 363 4,318 88 602 5,371 Investment banking - 734 - - 734 Total 5,781 7,065 215 680 13,741 For management purposes the Bank also reports the segment information of its operations by the following geographical locations: i) Oman ii) United Arab Emirates (UAE) iii) Egypt Transactions between the above segments are conducted at estimated market rates on an arm’s length basis. Segment information by geography is as follows: For the period ended 30 June 2026 Oman UAE Egypt Total ’000 ’000 ’000 ’000 Net interest income and income from Islamic financing and Investment activities 56,813 2,740 1 59,554 Fees, Commission and other operating income 30,307 998 27 31,332 Operating income/(loss) 87,120 3,738 28 90,886 Operating expenses (34,200) (1,335) (12) (35,547) Operating profit/(loss) 52,920 2,403 16 55,339 Impairment losses (net) and taxation (16,146) (114) 11 (16,249) Segment profit/(loss) for the period 36,774 2,289 27 39,090 Other information Segment assets 5,870,000 348,172 110 6,218,282 For the period ended 30 June 2025 Oman UAE Egypt Total ’000 ’000 ’000 ’000 Net interest income and income from Islamic financing and Investment activities 51,426 1,909 - 53,335 Fees, Commission and other operating income 25,054 1,038 12 26,104 Operating income/(loss) 76,480 2,947 12 79,439 Operating expenses (31,168) (1,195) (19) (32,382) Operating profit/(loss) 45,312 1,752 (7) 47,057 Impairment losses (net) and taxation (12,403) (699) 70 (13,032) Segment profit/(loss) for the period 32,909 1,053 63 34,025 Other information Segment assets 5,280,351 218,978 727 5,500,056
Page 41
- 31 - NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS (CONTINUED) As at 30 June 2026 (unaudited) 29 FAIR VALUE OF FINANCIAL INSTRUMENTS Based on the valuation methodology outlined below, the fair values of all financial instruments at 30 June 2026, 30 June 2025 and 31 December 2025 are considered by the Management not to be materially different to their book values. Estimation of fair values The following summarises the major methods and assumptions used in estimating the fair values of assets and liabilities: 1. Loans, advances and Islamic financing assets Fair value is calculated based on discounted expected future principal and interest cash flows. Loan repayments are assumed to occur at contractual repayment dates, where applicable. For loans that do not have fixed repayment dates or that are subject to prepayment risk, repayments are estimated based on experience in previous periods wh en interest rates were at levels similar to current levels, adjusted for any differences in interest rate outlook. Expected future cash flows are estimated considering credit risk and any indication of impairment. Expected future cash flows for homogeneous categories of loans are estimated on a portfolio basis and discounted at current rates offered for similar loans to new borrowers with similar credit profiles. The estimated fair values of loans reflect changes in credit status since the loans were made and changes in interest rates in the case of fixed rate loans. 2. Investments Fair value is based on quoted market prices at the reporting date without any deduction for transaction costs. If a quoted market price is not available, fair value is estimated based on discounted cash flow and other valuation techniques. Where discounted cash flow techniques are used, estimated future cash flows are based on management’s best estimates and the discount rate is a market-related rate for a similar instrument at the reporting date. 3. Current account balances due to and due from Banks The carrying amount of current account balances due to and from Banks was considered to be a reasonable estimate of fair value due to their short term nature. 4. Bank and customer deposits For demand deposits and deposits with no defined maturities, fair value is taken to be the amount payable on demand at the reporting date. The estimated fair value of fixed -maturity deposits, including certificates of deposit, is based on discounted cash flows using rates currently offered for deposits of similar remaining maturities. The value of long -term relationships with depositors is not taken into account in estimating fair values. 5. Other financial instruments No fair value adjustment is made with respect to credit -related off-balance sheet financial instruments, which include commitments to extend credit, standby letters of credit and guarantees, as the related future income streams materially reflect contractual fees and commissions actually char ged at the reporting date for agreements of similar credit standing and maturity. Foreign exchange contracts are valued based on market prices. The market value adjustments in respect of foreign exchange contracts are included in other assets and other liabilities. The fair values of financial instruments that are traded in active markets are based on quoted market prices. Other unquoted equities are valued based on information provided by fund managers, investee financial information and current purchase prices. Industry standard valuation models are used to calculate the expected future value of payments by product, which is discounted back to a present value. The model’s interest rate inputs are benchmark and active quoted interest rates in the swap, bond and futures markets. Interest rate volatilities are sourced from brokers and consensus data providers. If consensus prices are not available, these are classified as Level 3 instruments. The Bank measures fair values using the following fair va lue hierarchy, which reflects the significance of the inputs used in making the measurements.
Page 42
- 32 - NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS (CONTINUED) As at 30 June 2026 (unaudited) 29 FAIR VALUE OF FINANCIAL INSTRUMENTS (continued) Valuation models Level 1: inputs that are quoted market prices (unadjusted) in active markets for identical instruments. Level 2: inputs other than quoted prices included within Level 1 that are observable either directly (i.e. as prices) or indirectly (i.e. derived from prices). This category includes instruments valued using: quoted market prices in active markets for similar instruments; quoted prices for identical or similar instruments in markets that are considered less than active; or other valuation techniques in which all significant inputs are directly or indirectly observable from market data. Level 3: inputs that are unobservable. This category includes all instruments for which the valuation technique includes inputs not based on observable data and the unobservable inputs have a significant effect on the instrument’s valuation. This category includes instruments that are valued based on quoted prices for similar instruments for which significant unobservable adjustments or assumptions are re quired to reflect differences between the instruments. The following table shows an analysis of financial instruments other than derivatives instruments recorded at fair value by level of the fair value hierarchy: Level 1 Level 2 Total 30 June 2026 ’000 ’000 ’000 Investment measured at FVTPL Quoted equities 2,795 - 2,795 Unquoted equities - 2,734 2,734 Total 2,795 2,734 5,529 Investment measured at FVOCI Quoted equities 149,333 - 149,333 Total 149,333 - 149,333 TOTAL FINANCIAL ASSETS 152,128 2,734 154,862 Level 1 Level 2 Total 30 June 2025 ’000 ’000 ’000 Investment measured at FVTPL Quoted equities 2,240 - 2,240 Unquoted equities - 2,790 2,790 Total 2,240 2,790 5,030 Investment measured at FVOCI Quoted equities 113,078 - 113,078 Total 113,078 - 113,078 TOTAL FINANCIAL ASSETS 115,318 2,790 118,108 Level 1 Level 2 Total 31 December 2025 ’000 ’000 ’000 Investment measured at FVTPL Quoted equities 2,715 - 2,715 Unquoted equities - 2,805 2,805 Total 2,715 2,805 5,520 Investment measured at FVOCI Quoted equities 96,262 - 96,262 Total 96,262 - 96,262 TOTAL FINANCIAL ASSETS 98,977 2,805 101,782 The Bank's primary medium and long -term financial liabilities are the borrowed funds and subordinated liabilities. The fair values of these financial liabilities not materially different from their carrying values, since these liabilities are reprised at intervals of three or six months, depending on the terms and conditions of the instrument and the resultant applicable margins approximate th e current spreads that would apply for borrowings with similar maturities. Derivative financial instrument at level 2 are valued based on counter party valuation, quoted forward rates and yield curves (see note 3 0). There are no transfers between levels o f fair value measurement hierarchy during the period ended on 30 June 2026, 30 June 2025 and year ended 31 December 2025.
Page 43
- 33 - NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS (CONTINUED) As at 30 June 2026 (unaudited) 30 DERIVATIVES Notional amounts by term to maturity Positive fair value (Note 7) Negative fair value (Note 11) Notional amount total Within 3 months 3 – 12 months Above 1 Year ’000 ’000 ’000 ’000 ’000 ’000 30 June 2026 Interest rate swaps 9,337 (9,337) 951,614 24,508 62,907 864,199 Forward foreign exchange purchase contracts 10 (8) 364,999 221,462 143,537 - Forward foreign exchange sales contracts 2,312 (26) 364,999 221,557 143,442 - Total 11,659 (9,371) 1,681,612 467,527 349,886 864,199 30 June 2025 Interest rate swaps 8,821 (8,821) 488,630 15,404 38,719 434,507 Forward foreign exchange purchase contracts 42 (21) 474,055 252,387 187,362 34,306 Forward foreign exchange sales contracts 226 (529) 474,055 252,281 187,265 34,509 Total 9,089 (9,371) 1,436,740 520,072 413,346 503,322 31 December 2025 Interest rate swaps 8,100 (8,100) 758,217 21,548 62,891 673,778 Forward foreign exchange purchase contracts 6 (13) 375,229 240,358 125,251 9,620 Forward foreign exchange sales contracts 874 (18) 375,229 240,476 125,133 9,620 Total 8,980 (8,131) 1,508,675 502,382 313,275 693,018 Derivatives are valued at level 2 based on quoted forward rates.
Page 44
- 34 - NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS (CONTINUED) As at 30 June 2026 (unaudited) 31 LIQUIDITY COVERAGE RATIO The Liquidity coverage ratio (LCR) is a short time ratio designed to increase resilience against a liquidity shortage of up to 30 days. The LCR is computed as per CBO requirement under the circular BM1127 (BASEL III: Framework on Liquidity coverage ratio and LCR disclosure standards). June 2026 June 2025 December 2025 Total Unweighted Value (average) Total Weighted Value (average) Total Unweighted Value (average) Total Weighted Value (average) Total Unweighted Value (average) Total Weighted Value (average) ’000 ’000 ’000 ’000 ’000 ’000 High quality liquid assets Total High Quality Liquid Assets (HQLA) - 780,581 - 693,567 - 693,805 Cash outflows Stable deposits 397,649 11,929 394,850 11,845 408,255 12,248 Less stable deposits 417,164 41,716 332,968 33,297 353,625 35,363 Retail deposits and deposits from small business customers 814,813 53,645 727,818 45,142 761,880 47,611 Unsecured wholesale funding, of which: Operational deposits (all counterparties) and deposits in networks of cooperative banks 1,879,832 759,480 1,698,508 660,569 1,609,148 661,382 Additional requirements, of which: Credit and liquidity facilities 73,857 7,386 23,083 2,308 40,908 4,091 Other contractual funding obligations 26,872 1,344 18,771 939 17,522 876 Other contingent funding obligations 741,434 209,398 605,952 196,853 634,090 177,079 Total cash outflows 3,536,808 1,031,253 3,074,132 905,811 3,063,548 891,039 Cash inflows Inflows from fully performing exposures 479,427 406,354 316,033 246,678 354,764 281,414 Other cash inflows 208,058 208,058 228,778 228,778 175,357 175,357 Total cash inflows 687,485 614,412 544,811 475,456 530,121 456,771 Total high quality liquid assets - 780,581 - 693,567 - 693,805 Total net cash outflows - 416,841 - 430,355 - 434,268 Liquidity coverage ratio (%) - 187.26 - 161.16 - 159.76 The following tables set out the net stable funding ratio (NSFR) and leverage ratio of the bank: 30/06/2026 30/06/2025 31/12/2025 % % % NSFR 127.40 113.34 130.33 Leverage ratio 12.56 12.30 15.71