GFH Financial BSC : MN - Subsequent revisions to certain disclosures for the year ended 31st December 2022

CMP/MAR/2023/0003

نﻼﻋإ

Announcement

	Date		15/03/2023		ﺦﯾرﺎﺗﻟا
	Company Name		.ب.م.ش ﺔﯾﻟﺎﻣﻟا شﺗإ فإ ﻲﺟ ﺔﻋوﻣﺟﻣ		ﺔﻛرﺷﻟا مﺳإ
		GFH Financial Group B.S.C.
	Trading Code	GFH		لوادﺗﻟا زﻣر
			رﯾرﻘﺗو ةروﺷﻧﻣﻟا ﺔﯾﻟﺎﻣﻟا تﺎﻧﺎﯾﺑﻟا ﻲﻓ ﺔﺟردﻣﻟا تﺎﺣﺎﺻﻓﻹا ضﻌﺑﻟ ﺔﻘﺣﻼﻟا تﻼﯾدﻌﺗﻟا
			2022 رﺑﻣﺳﯾد 31 ﻲﻓ ﺔﯾﮭﺗﻧﻣﻟا ﺔﻧﺳﻠﻟ ﺔﻛرﺷﻟا ﺔﻣﻛوﺣ
	Subject		Subsequent revisions to certain disclosures included within the		عوﺿوﻣﻟا
			published Financial Statements and Corporate Governance Report
			for the year ended 31st December 2022

رﯾارﺑﻓ 9 ﻲﻓ ﺔﯾﻟﺎﻣﻟا شﺗإ فإ ﻲﺟ ﺔﻋوﻣﺟﻣ نﻋ ردﺎﺻﻟا ﻖﺑﺎﺳﻟا حﺎﺻﻓﻹا ﻰﻟإ ةرﺎﺷﻹﺎﺑ ﺔﻘﻗدﻣﻟا ﺔﯾوﻧﺳﻟا ﺔﯾﻟﺎﻣﻟا تﺎﻧﺎﯾﺑﻟا ﻰﻠﻋ ﺔﻘﻓاوﻣﻟاو ةرادﻹا سﻠﺟﻣ عﺎﻣﺗﺟا ﺞﺋﺎﺗﻧ نﺄﺷﺑ 2023 ذﺧﺗا دﻗ ةرادﻹا سﻠﺟﻣ نأ ﻰﻟإ ةرﺎﺷﻹا دوﻧ ، 2022 رﺑﻣﺳﯾد 31 ﻲﻓ ﺔﯾﮭﺗﻧﻣﻟا ﺔﯾﻟﺎﻣﻟا ﺔﻧﺳﻠﻟ

1.2 ﻰﻟإ ﻲﻛﯾرﻣأ رﻻود نوﯾﻠﻣ 1.5 نﻣ ةرادﻹا سﻠﺟﻣ ءﺎﺿﻋأ تﺂﻓﺎﻛﻣ ضﯾﻔﺧﺗﺑ ارارﻗً ﮫﯾﺟوﺗﺑ ﺎھرارﻗ ﺔﯾﻋرﺷﻟا ﺔﺑﺎﻗرﻟا ﺔﺋﯾھ تردﺻأ ، كﻟذ ﻰﻟإ ﺔﻓﺎﺿﻹﺎﺑ .ﻲﻛﯾرﻣأ رﻻود نوﯾﻠﻣ

.كﻧﺑﻟا نﻣ ًﻻدﺑ نﯾﻣھﺎﺳﻣﻟا ﻰﻟإ ةﺎﻛزﻟا ﻊﻓد ﺔﯾﻟوؤﺳﻣ

	ﺔﯾدﺎﻌﻟا ﺔﻣﺎﻌﻟا ﺔﯾﻌﻣﺟﻟا عﺎﻣﺗﺟا ﻰﻟإ ةوﻋدﻟا ﻲﻓ ﺎﮭﺟاردإو تارارﻘﻟا هذھ لﺛﻣ نﻋ نﻼﻋﻹا مﺗ
	.مدﺎﻘﻟا عﺎﻣﺗﺟﻻا ﻲﻓ نﯾﻣھﺎﺳﻣﻟا ﻰﻠﻋ ﺎﮭﺿرﻋ مﺗﯾﺳو ، 2023 رﯾارﺑﻓ 26 ﻲﻓ
	سﯾﺋر رﯾرﻘﺗ ﻲﻓ ةدراوﻟا تﺎﺣﺎﺻﻓﻹا ﻰﻠﻋ ﺔﻘﺣﻼﻟا تﻼﯾدﻌﺗﻟا ﻰﻟإ ةرﺎﺷﻺﻟ نﻼﻋﻹا اذھ ﻲﺗﺄﯾ
	تﺎﻧﺎﯾﺑﻟا ﻲﻓ ﺔﻠﺻﻟا تاذ تﺎظﺣﻼﻣﻟا ضﻌﺑو ﺔﯾﻋرﺷﻟا ﺔﺑﺎﻗرﻟا ﺔﺋﯾھ رﯾرﻘﺗو ةرادﻹا سﻠﺟﻣ
	لوادﺟﻟا ﻰﻟإ ﺔﯾﻓﺎﺿﻹا تﺎظﺣﻼﻣﻟاو ةدﻣﻋﻷا ضﻌﺑ ﺔﻓﺎﺿإ تﻣﺗ ، كﻟذ ﻰﻟإ ﺔﻓﺎﺿﻹﺎﺑ .ﺔﯾﻟﺎﻣﻟا
	قﺎﻓرإ مﺗ يذﻟاو ،ﺔﻣﻛوﺣﻟا رﯾرﻘﺗ ﻲﻓ مﮭﺳﻷا تازﺎﯾﺣﺑ ﺔﻘﻠﻌﺗﻣﻟا تﺎﻣوﻠﻌﻣﻟا نﻋ فﺷﻛﺗ ﻲﺗﻟا
	.ﮫﻧﻣ ﺔﻟدﻌﻣ ﺔﺧﺳﻧ
Information
ﺔﻣوﻠﻌﻣﻟا

With reference to the previous disclosure issued by GFH Financial Group on February 9, 2023 in relation to the results of the Board of Directors meeting and the approval of the annual audited financial statements for the fiscal year ending on December 31, 2022, we would like to note that the Board has taken a decision to reduce the remuneration of the members of the Board of Directors from USD

1.5 million to USD 1.2 million. In addition, the Sharia Supervisory Board has also provided their decision to direct the responsibility of paying Zakat to the shareholders, instead of the Bank.

Such decisions were announced and included in the invitation to the Annual General Meeting on February 26, 2023, and will be presented to the shareholders in the ensuing Annual General Meeting. This announcement is being made to indicate the

subsequent revisions that impact disclosures made in the issued report of the Chairman of the Board of Directors, the report of the Sharia Supervisory Board and some related notes in the financial statements. In addition, some columns and additional notes have been added to tables disclosing information related to holdings of shares in the Corporate Governance Report, a revised version of which has been attached.

Name		Mariam Jowhary	يﺮھﻮﺟ ﻢﯾﺮﻣ		ﻢﺳﻹا
Title		Head of Compliance & AML	لاﻮﻣﻻا ﻞﺴﻏ ﺔﺤﻓﺎﻜﻣو ماﺰﺘﻟﻹا ﺲﯿﺋر		ﻲﻔﯿظﻮﻟا ﻰﻤﺴﻤﻟا
	Company Seal ﺔﻛﺮﺸﻟا ﻢﺘﺧ	Signature ﻊﯿﻗﻮﺘﻟا

Subsequent revisions to certain disclosures included within the published Financial Statements and Corporate Governance Report for the year ended 31st December 2022

With reference to the previous disclosure issued by GFH Financial Group on February 9, 2023 in relation to the results of the Board of Directors meeting and approval of the annual audited financial statements for the fiscal year ended on December 31, 2022, we would like to note that the Board has taken a decision to reduce the remuneration of the members of the Board of Directors from USD 1.5 million to USD 1.2 million, and hence the table presented in the Chairman's report will be revised as follows:

(BD 000s)

				Fixed remunerations		Variable remunerations	service-of-Endaward	Aggregateamount		not(Doesinclude allowance)expense	AllowanceExpenses
Name		Remunerations	chairmantheof BODand	allowanceTotal attendingfor andBoard	committee	Others	Total	Remunerations	chairmantheof BODand	plansIncentive	Others**	Total
First: Independent Directors:
Alia Al Falasi		-	56,409	-	56,409	-	-	-	-	-		56,409	-
Ghazi Faisal Ebrahim		75,400	107,540	-	182,940	-	-	-	-	-		182,940	-
Alhajeri
Fawaz Al Tamimi		56,550	57,540	-	114,090	-	-	-	-	-		114,090	-
Ali Murad		56,550	55,278	-	111,828	-	-	-	-	-		111,828	-
Ahmed Al Ahmadi		-	26,885		26,885	-	-	-	-	-		26,885	-
Edris Mohd Rafi Mohd		65,975	58,294		124,269	-	-	-	-	-		124,269	-
Saeed Alrafi
Darwish AlKetbi		56,550	54,901		111,451	-	-	-	-	-		111,451	-
Yousif Abdulla Taqi		28,275	27,639	-	55,914	-	-	-	-	-		55,914	-
Second: Non-Executive Directors:
Jassim Alseddiqi		-	377	-	377	-	-	-	-	-		377	-
Rashed Alkaabi		56,550	58,370	-	114,920	-	-	-	-	-		114,920	-
Third: Executive Directors:
Hisham Alrayes		56,550	55,278	-	111,828	-	-	-	-	-		111,828	-
Total		452,400	558,511	-	1,010,911	-	-	-	-	-	1,010,911	-

In addition, the Sharia Supervisory Board (SSB) has also provided their decision to direct the responsibility of paying Zakat to the shareholders, instead of the Bank. Accordingly, SSB Report and appropriation mentioned in Note 18 of the financial statements have been revised to following, respectively:

• 4. Zakah was calculated according to the Islamic Sharia rules and principles, by the net assets method. It is to be noted that the responsibility of paying Zakah lies on the Shareholders of the Bank.
• To allocate an amount of US $ 1,000,000 to civil society organisations

GFH Financial Group B.S.C. Corporate Governance Report

FY-2022

GFH Financial Group BSC ("GFH" or the "Bank") is an Islamic Wholesale bank that was established in 1999 in the Kingdom of Bahrain. GFH's business activities are carried in accordance with the principles of Islamic Sharia which includes financial services, investment and commercial transactions, negotiable financial instruments, in addition to structured finance, securities and liquidity management designed to achieve profitable returns for investors.

In 2004, GFH Financial Group was converted from a closed shareholding company to a public shareholding company. Its shares are currently listed on the Bahrain Bourse, Boursa Kuwait, Dubai Financial Market, and Abu Dhabi Securities Exchange. Furthermore, in 2020 GFH issued Sukuk of up to US$ 500 million which are listed on London Stock Exchange and NASDEQ Dubai.

As a Public Shareholding Company, GFH's corporate governance framework is based on the guidelines issued by Ministry of Industry, Commerce (MOIC) under the Commercial Companies Law promulgated by Decree No. (21) for the year 2001 ("Companies Law") and the amendments thereto, the regulations of MOIC's Corporate Governance Code of 2018 promulgated by Decree No. (19) for 2018, the High-Level Controls Module ("HC Module") issued by the Central Bank of Bahrain (CBB) under its Rulebook - Volumes 2 and 6 and the amendments thereto and the Listing Rules approved by the Board of Directors of Bahrain Bourse in its meeting (4/2019) dated 08/10/2019 and the amendments thereto.

GFH's Corporate Governance Philosophy

The corporate governance framework is focused on assisting GFH to successfully meet its strategic objectives and maintain steady growth whilst remaining fully cognisant of our clients' and shareholders' interests.

GFH believes that compliance with corporate governance principles enhances its value through providing a suitable framework for the Board, Board Committees and Management to perform their duties in a manner that serves the interests of the bank and its shareholders. For this reason, GFH strives to achieve the highest levels of transparency and accountability by adopting and executing strategies, goals and policies which are aimed to comply with the regulatory requirements.

The Board of Directors are accountable to shareholders for the creation and delivery of strong sustainable financial performance and long-term shareholder value. To achieve this, the Board implement and monitors the Bank's strategy and performance, within a framework of sound corporate governance. The Chairman of the Board is responsible for leading the Board, ensuring its effectiveness, monitoring the performance of the CEO and maintaining a dialogue with the bank's stakeholders. The control functions such as Internal Audit, Risk Management and Compliance & AML report directly to the Board Audit and Risk Committee ("ARC").

Compliance with Regulations (High Level Control Module - CBB Rulebook, Volume 2)

In 2022, GFH continued the implementation of the Corporate Governance rules and the requirements of 'High Level Control Module of the CBB Rulebook Volume 2 (HC Module)'.

As per rule HC-A.1.8 and HC-8.2.1 (c) of the HC Module with reference to the disclosure of the non-compliance events (Comply or Explain Principle), which stipulates the need to elucidate the non-compliance cases and provide clarification on the same in event non-compliance with the rules and guidelines of the HC Module, GFH wishes to clarify the following:

• The NRGC committee does not include a Sharia Scholar (a member of Sharia Supervisory Board) as recommended under guidance note HC-9.2.4 (b).
• Contrary to guidance note HC-7.2.2 which recommends all Board Members to attend the shareholders' meeting, the shareholders' meetings held on 3 April 2022 were attended by three Board Members.
• ARC has been dissolved following the resignation of Ms. Alia Al Falasi on 9 November 2022, with the number of remaining committee members short of the quorum required by the ARC charter.

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