Bahrain Islamic Bank B S C : Composition of Capital and Liquidity Disclosures – 30 June 2023

Bahrain Islamic Bank B.S.C.

Composition of Capital and Liquidity Disclosures

As at 30 June 2023

Reconcilation of Published Financial Balance Sheet to Regulatory Reporting as at 30 June 2023

	Statement of Financial		Statement of Financial
	position as per
		position as per
	published financial
		Regulatory Reporting
	statements
	Q2 2023		Q2 2023
	BD'000		BD'000
Assets
Cash and balances with banks and Central Bank	60,224	60,224
Gross Placements with financial institutions	41,148	41,148
Less: Expected credit loss (stage 3)	(3,686)	(3,686)
Less: Expected credit loss (stage 1 and stage 2)	(3)	-
Net placements with financial institutions	37,459	37,462
Gross financing assets	666,273	666,273
Less: Expected credit loss (stage 3)	(21,081)	(21,081)
Less: Expected credit loss (stage 1 and stage 2)	(12,077)	-
Net financing assets	633,115	645,192
Gross investment securities	303,449	303,449
Less: Expected credit loss (stage 3)	(26,794)	(26,794)
Less: Expected credit loss (stage 1 and stage 2)	(148)	-
Net investment securities	276,507	276,655
Ijarah Muntahia Bittamleek	313,402	313,402
Less: Expected credit loss (stage 3)	(1,617)	(1,617)
Less: Expected credit loss (stage 1 and stage 2)	(1,864)	-
Net Ijarah Muntahia Bittamleek	309,921	311,785
Investment in associates	8,115	8,115
Investment in real estate	16,176	16,176
Property and equipment	13,679	13,679
Other assets	15,465	15,465
TOTAL ASSETS	1,370,661	1,384,753
Liabilities, Equity Of Investment Accountholders
And Owners' Equity
Liabilities
Placements from financial institutions	143,252	143,252
Placements from non-financial institutions and individuals	282,203	282,203
Financing from financial institutions	110,236	110,236
Customers' current accounts	208,386	208,386
Other liabilities	44,316	44,161
of which: Expected credit loss - Off balance sheet exposures (stage 3)	1,310	1,310
(stage 1 and stage 2)	155	-
of which: Other liabilities	42,851	42,851
Total Liabilities	788,393	788,238
Total Equity of Investment Accountholders	442,709	442,709
Owners' Equity
Share capital	106,406	106,406
Subordinated Mudaraba (AT1)	-	-
Treasury shares	(892)	(892)
Shares under employee share incentive scheme	(169)	(169)
Share premium	206	206
Statutory reserve	6,606	6,606
Real estate fair value reserve	1,320	1,320
Investment securities fair value reserve	1,585	1,585
Expected credit loss	-	14,247
of which: amount eligible for Tier 2 capital subject to a maximum of 1.25% of credit risk weighted assets	-	8,978
of which: amount ineligible for Tier 2 capital	-	5,269
Profit for the period	6,035	6,035
Retained earnings brought forward	(6,538)	(6,538)
of which: Retained earnings as of 1 January 2023	(4,217)	(4,217)
of which: Zakah and donations approved	(420)	(420)
of which: Profit distribution on AT1 Capital	(1,901)	(1,901)
Equity Attributable to Parent's Shareholders	114,559		128,806
Subordinated Mudaraba (AT1)	25,000	25,000
Total Owners' Equity	139,559	153,806
TOTAL LIABILITIES, EQUITY OF INVESTMENT
ACCOUNTHOLDERS AND OWNERS' EQUITY	1,370,661		1,384,753

Composition of Capital Common Disclosure Template as at 30 June 2023

Common Equity Tier 1 capital: instruments and reserves

	1.	Directly issued qualifying common share capital plus related stock surplus	118,192
	2.	Retained earnings	7,758
	3.	Accumulated other comprehensive income (and other reserves)	1,585
	4.	Not applicable	-
	5.	Common share capital issued by subsidiaries and held by third parties (amount allowed in group CET1)	-
	6.	Common Equity Tier 1 capital before regulatory adjustments	127,535
		Common Equity Tier 1 capital: regulatory adjustments
	7.	Prudential valuation adjustments	-
	8.	Goodwill (net of related tax liability)	-
	9.	Other intangibles other than mortgage-servicing rights (net of related tax liability)	-
	10.	Deferred tax assets that rely on future profitability excluding those arising from temporary differences (net of related tax	-
	liability)
	11.	Cash-flow hedge reserve	-
	12.	Shortfall of provisions to expected losses	-
	13.	Securitisation gain on sale (as set out in paragraph 562 of Basel II framework)	-
	14.	Not applicable	-
	15.	Defined-benefit pension fund net assets	-
	16.	Investments in own shares	-
	17.	Reciprocal cross-holdings in common equity	-
		Investments in the capital of banking, financial and insurance entities that are outside the scope of regulatory consolidation,
	18.	net of eligible short positions, where the bank does not own more than 10% of the issued share capital (amount above 10%	-
		threshold)
	19.	Significant investments in the common stock of banking, financial and insurance entities that are outside the scope of	-
	regulatory consolidation, net of eligible short positions (amount above 10% threshold)
	20.	Mortgage servicing rights (amount above 10% threshold)	-
	21.	Deferred tax assets arising from temporary differences (amount above 10% threshold, net of related tax liability)	-
	22.	Amount exceeding the 15% threshold	-
	23.	of which: significant investments in the common stock of financials	-
	24.	of which: mortgage servicing rights	-
	25.	of which: deferred tax assets arising from temporary differences	-
	26.	CBB specific regulatory adjustments	-
	27.	Regulatory adjustments applied to Common Equity Tier 1 due to insufficient Additional Tier 1 and Tier 2 to cover	-
	deductions
	28.	Total regulatory adjustments to Common equity Tier 1	-
	29.	Common Equity Tier 1 capital (CET1)	127,535

Composition of Capital Common Disclosure Template as at 30 June 2023

Additional Tier 1 capital: instruments

	30.	Directly issued qualifying Additional Tier 1 instruments plus related stock surplus	25,000
	31.	of which: classified as equity under applicable accounting standards	-
	32.	of which: classified as liabilities under applicable accounting standards	-
	33.	Directly issued capital instruments subject to phase out from Additional Tier 1	-
	34.	Additional Tier 1 instruments (and CET1 instruments not included in row 5) issued by subsidiaries and held by third parties	-
	(amount allowed in group AT1)
	35.	of which: instruments issued by subsidiaries subject to phase out	-
	36.	Additional Tier 1 capital before regulatory adjustments	25,000
		Additional Tier 1 capital: regulatory adjustments
	37.	Investments in own Additional Tier 1 instruments	-
	38.	Reciprocal cross-holdings in Additional Tier 1 instruments	-
		Investments in the capital of banking, financial and insurance entities that are outside the scope of regulatory consolidation,
	39.	net of eligible short positions, where the bank does not own more than 10% of the issued common share capital of the entity	-
		(amount above 10% threshold)
	40.	Significant investments in the capital of banking, financial and insurance entities that are outside the scope of regulatory	-
	consolidation (net of eligible short positions)
	41.	CBB specific regulatory adjustments	-
	42.	Regulatory adjustments applied to Additional Tier 1 due to insufficient Tier 2 to cover deductions	-
	43.	Total regulatory adjustments to Additional Tier 1 capital	-
	44.	Additional Tier 1 capital (AT1)	25,000
	45.	Tier 1 capital (T1 = CET1 + AT1)	152,535
		Tier 2 capital: instruments and provisions
	46.	Directly issued qualifying Tier 2 instruments plus related stock surplus	1,320
	47.	Directly issued capital instruments subject to phase out from Tier 2	-
	48.	Tier 2 instruments (and CET1 and AT1 instruments not included in rows 5 or 34) issued by subsidiaries and held by third	-
	parties (amount allowed in group Tier 2)
	49.	of which: instruments issued by subsidiaries subject to phase out	-
	50.	Provisions	8,978
	51.	Tier 2 capital before regulatory adjustments	10,298
		Tier 2 capital: regulatory adjustments
	52.	Investments in own Tier 2 instruments	-
	53.	Reciprocal cross-holdings in Tier 2 instruments	-
		Investments in the capital of banking, financial and insurance entities that are outside the scope of regulatory consolidation,
	54.	net of eligible short positions, where the bank does not own more than 10% of the issued common share capital of the entity	-
		(amount above the 10% threshold)
	55.	Significant investments in the capital banking, financial and insurance entities that are outside the scope of regulatory	-
	consolidation (net of eligible short positions)
	56.	National specific regulatory adjustments	-
	57.	Total regulatory adjustments to Tier 2 capital	-
	58.	Tier 2 capital (T2)	10,298
	59.	Total capital (TC = T1 + T2)	162,833
	60.	Total risk weighted assets	837,775

Composition of Capital Common Disclosure Template as at 30 June 2023

Capital ratios and buffers

	61.	Common Equity Tier 1 (as a percentage of risk weighted assets)	15.22%
	62.	Tier 1 (as a percentage of risk weighted assets)	18.21%
	63.	Total capital (as a percentage of risk weighted assets)	19.44%
	64.	Institution specific buffer requirement (minimum CET1 requirement plus capital conservation buffer plus countercyclical	9%
	buffer requirements plus D-SIB buffer requirement, expressed as a percentage of risk weighted assets)
	65.	of which: capital conservation buffer requirement	2.50%
	66.	of which: bank specific countercyclical buffer requirement	N/A
	67.	of which: D-SIB buffer requirement	N/A
	68.	Common Equity Tier 1 available to meet buffers (as a percentage of risk weighted assets)	15.22%
		National minima including CCB (where different from Basel III)
	69.	CBB Common Equity Tier 1 minimum ratio	9.00%
	70.	CBB Tier 1 minimum ratio	10.50%
	71.	CBB total capital minimum ratio	12.50%
		Amounts below the thresholds for deduction (before risk weighting)
	72.	Non-significant investments in the capital of other financials	-
	73.	Significant investments in the common stock of financials	-
	74.	Mortgage servicing rights (net of related tax liability)	-
	75.	Deferred tax assets arising from temporary differences (net of related tax liability)	-
		Applicable caps on the inclusion of provisions in Tier 2
	76.	Provisions eligible for inclusion in Tier 2 in respect of exposures subject to standardized approach (prior to application of	14,247
	cap)
	77.	Cap on inclusion of provisions in Tier 2 under standardized approach	8,978
	78.	N/A	-
	79.	N/A	-
	Capital instruments subject to phase-out arrangements (only applicable between 1 Jan 2019 and 1 Jan 2023)
	80.	Current cap on CET1 instruments subject to phase out arrangements	NA
	81.	Amount excluded from CET1 due to cap (excess over cap after redemptions and maturities)	NA
	82.	Current cap on AT1 instruments subject to phase out arrangements	NA
	83.	Amount excluded from AT1 due to cap (excess over cap after redemptions and maturities)	NA
	84.	Current cap on T2 instruments subject to phase out arrangements	NA
	85.	Amount excluded from T2 due to cap (excess over cap after redemptions and maturities)	NA