ib-annual report 2016 signature (1) - investbank · 2018-05-29 · raouf abu jaber &sons co....

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6 an

d cl

eara

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of th

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oard

of D

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tors

for

the

said

yea

r.

2006

2007

2008

2009

2010

%25

%11.50

%14.15

%10.71

%10

11,000,000

6,325,000

8,675,000

7,500,000

7,750,000

2009

2.000

4.000

6.000

8.0007.238

10.887

9.596

11.25211.931 12.365

14.310

10.000

12.000

14.000

2010 2011 2012 2013

16.000

2014 2015 2016

15.607

The Bank continued the distribution of free shares to the shareholder in the framework of its effort to increase the capital of the Bank and in a way that complies with the requirements of the Central Bank and strengthens the financial base of the bank. A total of 8.250 million shares were distributed annually from the years 2006 until 2010 as shown in Schedule No. 10

The following graph shows the annual profits after taxes from 2009 to 2016.

34th

-

The shares owned by members of the Board of Directors and individuals in the senior management and their relatives and the controlled companies for the years 2016 and 2015

Abdul Rahim Jardaneh & Sons Co.,represented by:

Madaba Financial Investment Co., represented by:

Mr. Ayman Shafiq Farhan Jumaian

Dr. Nabil Hani Jamil Qaddumi

Raouf Abu Jaber &Sons Co. represented by:

Jordan Medical Drug Co. represented by

Mr. Abdul Rahim Nizar Abdul Rahim Jardaneh

Mrs. Wijdan Mohammad Yaseen Khalil Altalhouni

Mrs. Zina Nizar Abdul Rahim Jardaneh

Fahmi bin Faeq bin Fahmi Abu Khadra

Bank of Palestine represented by

Mr. Roshdi Mahmoud RashidAlghalayeeni

Mr. Jiries Spero Jiries Alisa

Mr. Hani Ibrahim Suleiman Fadayel

Mr. Emad Nihad Khalil Jeryes

Member

Member

Member

Member

Member

Member

Member

Member

Member

Mr. Bisher Mohammad Abdul Rahim Jardaneh

Chairmanof theBoard

Vice Chairman

Jordanian

Jordanian

Jordanian

Jordanian

Jordanian

Jordanian

Jordanian

Jordanian

Jordanian

Jordanian

Jordanian

Jordanian

Saudi

Palestinian

Palestinian

Kuwaiti

185,581

850,000

38,138 95,699 95,699

57,561

2,153,936

9,088

20,000

1,009,479

8,431,216

4,962,866

97,000

5,000

5,320 5,320 5,320

5,000 5,000

97,000 1,000,359

5,994,399

9,420,627 9,420,627 9,420,627

5,994,399 2,420,407

4,962,866 4,962,866

9,088

2,153,936

29,088

9,440,695 9,440,695

2,153,936

1,035,581 185,581

Annual Report 34th

3Annual Report 34th

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

Bank of Palestine

Abdul Rahim Nizar Abdul Rahim Jardaneh

Almadar International Investment Co.

Fahmi bin Faeq bin FahmiAbu Khadrah

Hazem bin Faeq bin FahmiAbu Khadrah

Samer bin Faeq bin FahmiAbu KhadrahZina Nizar Abdul Rahim Jardaneh

Ihab Shafiq Farhan Jumaian

Lina Nizar Abdul Rahim Jardaneh

The Congress Foundation

Zainah Saad Khalaf Altal

Tamarah Saad Khalf Altal

General Investment C0.

Nabil Hani Jamil Qaddumi

Saad Hani Jamil Qaddumi

Alzarka Grand Mills Co.

United Insurance Co.

Jordan Drugstore Co.

Total

Raghdah Hamdi Khalil Manko

Jordan Kuwaiti Bank

Jordan Kuwaiti Bank

Jordan Kuwaiti Bank

Jordan Kuwaiti Bank

Alkhaleej Bank/Kuwait

Alkhaleej Bank/Kuwait

Director of Insurance Regulatory Commission

Palestinian

Jordanian

Jordanian

Jordanian

Jordanian

Jordanian

Jordanian

Jordanian

Jordanian

Jordanian

Jordanian

Jordanian

Jordanian

Kuwaiti

Kuwaiti

Liechtenstein

Saudi

Saudi

Saudi

9,420,627

8,431,216

7,371,427

7,026,822

5,994,399

5,733,449

5,733,274

5,733,274

4,880,143

4,341,648

3,651,246

2,310,936

2,310,935

2,154,328

2,153,936

1,850,907

1,316,414

1,313,715

1,009,479

81,967,767

1,666,666

1,461,233

1,262,320

18,750

15,092,303

5,000 1,666,667

1,667,667

7,350,000

5,000 Board Membership

Board Membership

5,000

5,000

5,000

25,000

Board Membership

Board Membership

Board Membership

Annual Report 34th

2016

4,236 4,236

4,236 4,236

1,070 1,070

1,070 1,070

2,140 2,140

31,719 31,719

2015

1

1

2

3

Mr. Ayman Shafiq Farhan Jumaiaan


Nizar Abdul Rahim Nizar Jardaneh

Darah Abdul Rahim Nizar Jardaneh

Rawan Abdul Rahim Nizar Jardaneh

Wijdan “Mohammad Yasin” Khaleel Al Talhouni Bassam Khaleel Abdul Rahim Alsaket

Bisher Mohammad Abdul Rahim Jardaneh

Ayman Shafiq

Montaser Izzat Ahmad Abu Dawwas Chief Executive Officer

Almashreq Real Estate Services

Co.

Private Joint Stock

Company

Private Joint Stock

CompanyPrivate Joint

Stock Company

Arabtech Jardaneh Palestine/Architects

& EngineersMadaba Financial

Investment Co.

Chairman of the Board

Vice Chairman

Nahlah Tawfeeq Jeryes Karadsheh

Zaid Ayman Shafiq Jumaiaan

Wife

Son

Son

Daughter

Daughter

Husband

Vice Chairman

Member

Member

Jordanian

Jordanian

Jordanian

Jordanian

Jordanian

Jordanian

Jordanian

Jordanian

Jordanian

Jordanian

Jordanian

329,141

33,331

38,138

500,000 %0.05

38,138

33,331

329,141

Palestinian

No shares are owned by relatives of individuals in senior / executive management.

No shares are owned by companies controlled by individuals in senior / executive management or their relatives.

1

2

3

4

5

6

7

Annual Report 34th

Bank of Palestine 9,420,627 9.421 9,420,627 9.421

8,431,216 8.431 8,431,216 8.431

7,371,427 7.371 7,371,427 7.371

7,026,822 7.027 7,026,822 7.027

5,994,399 5.994 2,420,407 2.420

5,733,449 5.733 2,329,035 2.329

5,733,274 5.733 2,328.561 2.329


The total balance of loans and director and indirect facilities used as at the end of 2016 and that were grantedto members of the Board of Directors of the Bank and persons related to them are as follows:

Almadar International InvestmentCo.

Raghdah Hamdi Khalil MankoFahmi bin Faeq bin Fahmi Abu KhadrahHazem bin Faeq bin Fahmi Abu Khadrah

Mr. Bisher Mohammad Abdul Rahim Jardaneh Group 3,127

64

6

1,870

2.3

981

2,006

0.16

8,056.46

Mr. Rauof Abu Jaber Group

Mrs. Wijdan Mohammad Yaseen Khaleel Altalhouni

Mr. Abul Rahim Nizar Abdul Rahim Jardaneh Group

Mrs. Zina Nizar Abdul Rahim Jardaneh

Mr. Ayman Safiq Farhan Jumaian Group

Dr. Nabil Hani Jamil Alqadoumi Group

Mr. Hani Ibrahim Suleimjan Fadayel

Total

Samer bin Faeq bin Fahmi Abu Khadrah

Annual Report 34th

Mr. Bisher Mohammad Abdul Rahim Jardaneh 6,000 49,000 5,000 60,000 0

6,000 6,618 5,000 17,618 1

5,500 2,500 4,286 12,286 2

5,500 4,079 4,286 13,865 1

6,500 2,000 4,286 12,786 1

8,250 750 4,286 13,286 1

5,500 49,000 4,286 58,786 1

6,000 49,000 5,000 60,000 0

6,000 6,736 5,000 17,736 0

8,250 2,500 4,286 15,036 2

6,000 5,604 5,000 16,604 0

69,500 177,787 50,716 298,003

Mr. Ayman Shafiq Farhan Jumaiaan

Mrs. Wijdan “Mohammad Yaseen” Khalil Altalhouni

Mr. Abdul Rahim Nizar Abdul Rahim Jardaneh

Mrs. Z Nizar Abdul RahimJardaneh

Dr. Nabil Hani Jamil Qaddumi

Mr.Hani Ibrahim Suleiman Fadayel

Mr. Jiries Spiro Jiries Alisa

Mr. Emad Nihad Khail Jeryes

Mr. Roshdi Mahmoud Rashid Alghalayeeni

Fahmi bin Faeq bin Fahmi Abu Khadra

Total

Annual Report 34th

1500,480 2,500 225,000 727,980

141,400 400 22,000 163,800

64,500 8,170 20,000 92,670

126,000 700 35,000 161,700

117,000 400 30,000 147,400

98,666 400 30,000 129,066

76,533 600 10,000 87,133

4,000 2,181 0 6,181

1,569,844 15,351 468,000 2,053,195

30,000 0 30,000

98,666 25,000 123,666

91,666 28,000 119,666

79,533 18,000 97,533

141,400 25,000 166,400

Montaser Izzat Ahmad Dawwas

Chief ExecutiveOfficer

Chief Risk Management

Head of Internal Audit Department

Assistant / Facilities for large corporationsDepartment

Assistant / Commercial BankingServices Department

Emad Osama Abdulrahim Asfour

Mohammad Ali Yousef Hawash(Up till 2016/07/31)

Ramzi Ridwan Hasan Darweesh

Mohannad ZuhairAhmad Bokah

Tarerq “Mohammad Nazih” Mohammad Mamdooh Sakkijha

Assistant / Personal Banking Services Department

Mayes Adnan Mahmoud Alshalabi

Ra’ad Moneer Abdulrahim Abu Resa’

Mohammad AliWaleed Abu Anza

Executive Manager/ Organizational Development Department

Executive Manager, Legal Department

Jareer Na’el Jamil Alajlouni

Executive Manager/ Treasury Depatment

Mohammad Saeed Yahya Fayeq Aldajani

Executive Manager/ Financial Corporations

Rola Adel Kamel Zakareya(Starting 2016/08/01)

Khaled Zuhair Jamil Abu Alsha’er(up till 2016/01/31)

Total

Executive Manager/Compliance Department

Executive Manager/Compliance Department

2

3

4

5

6

7

8

9

10

11

12

13

COMMUNITY SERVICE AND PROTECTION OF THE ENVIRONMENT

Annual Report 34th

When community service aims to achieve the highest concept of investment, then growth will be achieved, and sustainability is reached and all efforts are combined to achieve targets, and this is the path we have set ourselves in INVESTBANK in all the multiple initiatives we stated within our program of social responsibility. We aspire through these initiatives to reflect our vision in the noblest way, and we desire to establish as a top priority a community service that will give people the dignified life they deserve.

We view the environment as one of the most important factors in the process of development, and when environment receives proper backing and support in all fields it becomes a fertile ground for more investment, both in human and material resources, thus it has become the first axis of our attention and care.

The second axis in our social plans is to empower local communities to enable them to face challenges and to create new employment opportunities to enable these communities to become self sufficient.

We did not neglect support of cultural and artistic initiatives that aim to preserve the civilized and cultural heritage, thus we supported the creative economy that highlights the abilities of our local artists in this field, thus enabling them to present civilized Jordan in all aspects.

Renewable energy is the new language of the world today, accordingly we established our own project to generate electricity, thus becoming the first bank in Jordan to utilize renewable energy source to cover all its electricity requirements.

We are proud today of all the successes we were able to achieve in the field of social responsibility and are determined to consolidate all our efforts to continue with the path we set for ourselves to serve our community, thus investing in a better future for ourselves and for future generations.

Four Winters

On the environmental level, and within INVESTBANK’s Al Shams fund initiatives, the Bank sponsored the organic farming project as part of Al Shams Farmers’ Market for five years in Ajloun region and the surrounding villages. We provided financing of organic seeds, pesticides, organic fertilizers, and irrigation water. INVESTBANK, jointly with the Royal Society for the Conservation of Nature, trained farmers of Al Kifah Cooperative Society, a community based organization, on methods to reduce wastage of products and proper packaging of produce. This enabled the farmers in the past years to increase their production on annual basis and to expand their commercial activity in the local market and to serve the markets of the capital Amman.

The project achieved an increase of %40 in production, and an increase in total sales by %46, the number of direct beneficiaries of the project reached 285 farmers and the indirect beneficiaries reached 1,078 in 2016, compared to the year before. To enforce the sustainability of the project, INVESTBANK expanded the initiative to include new cooperative societies by training members of these societies to give them proper qualification, jointly with Al Kifah Cooperative Society, by introducing them to all the fundamentals of organic farming.

The initiative was further enforced by signing a memorandum with the Jordanian Organic Farming Association to strengthen the national cooperation in the field of organic farming , giving particular attention to the training and licensing internationally accredited Jordanian organic farming inspectors.

INVESTBANK also created new marketing channels by signing partnership contracts with private sector establishments to introduce Al Shams Farmers’ Market and to created new sources of income for the farmers. The Bank introduced Al Shams Farmers’ Market to Four Winters in the spirit of “ from the farm to the table”, and Four Winters created Golden Apple Pie Ice Cream, utilizing as an ingredient chemicals free apples supplied by Al Shams Farmers’ Market, and %25 of the income generated was utilized to build a plastic green house in Ajloun farms.

Annual Report 34th

Annual Report 34th

Within the same concept, INVESTBANK expanded its sponsorship to cover the southern region of Jordan, by establishing partnership with Zikra Initiative, to create a development food production project in Ghor Al Mazaraa region. This project aims to empower the local community, which has the highest poverty rate in the Kingdom. The project aims to enforce environmental sustainability by reducing wastage of the tomatoes harvest, being the crop that is subject to the highest wastage in Ghour Region. It also aims to increase the value added to the harvest by enabling the processing of the produce into other food products, such as dried tomatoes, crushed dried tomatoes, dried tomatoes powder, tomatoes vinegar, and other products. The project also aims to bridge the gap between the farm and the local produce market.

In the field of cultural and educational level, the increased support that INVESTBANK has offered to the Petra National Trust has achieved notable success which solidified the necessity of the partnership with the Society to fulfill their vision of directing the creativity of young people to serve the Rose City environment, and to market Petra as an international landmark and heritage. A new series of functions were introduced to train and qualify forty young men and women from the Petra Region by local visual artists to build their abilities and skills to introduce work of art highlighting the beauty of the Rose City. The art works will be exhibited in a dinner banquet inspired by the Nabatian heritage, the revenue of the banquet will be allocated to support the activity of Petra National Trust.

Annual Report 34th

INVESTBANK played a leading role in the field of renewable sources of power. The Bank executed the solar power generation project by installing solar panels over the head office’s parking lot. The solar power generation project is a clean source of energy aiming to product a maximum of 386 kilowatt, providing %65 of the bank’s electricity requirements. INVESTBAK is the first bank to utilize renewable sources of power to cover parts of the requirements of the head office of electricity. The bank is currently studying the possibility to expand this successful project to utilize renewable sources of energy by installing solar panels to all branches of the bank.

Annual Report 34th

INVESTBAK enforced this year the concept of practicing healthy habits among staff, which contributes to improving their quality of life and their daily performance. The Bank continued holding educational lecture covering various subjects of interest to the staff, and also conducted free medical test for staff of the head office and all the branches, jointly with Medlab medical laboratories and Jordan International Insurance Company. These tests will be carried out on annual basis, as continuation of staff health and educational campaign introduced by the Bank last year under the heading “Time to Change”.The Bank also created in cooperation with the National blood bank a special blood storage facility for the bank employees, in which their blood donations are preserved for their use, or for the use of their relatives in emergencies. Staff will donate blood for this program every six months. As for developing human capabilities, INVESTBANK continued its charitable practice of supporting Gifted Autistic Children Society by offering scholarships for autistic children, in addition to covering the expense of training some of the children to integrate them in the society and for them to become effective participants in utilizing their energies. The Bank also provided support for the training of mothers on coping with their autistic children.

•

•

•

•

Annual Report 34th

Royal Society for the Conservation of Nature

Zikra Initiative

Hashemite Jordanian Fund

National Society for the Conservation of Petra

The Society for the Care of Gifted Autistic Children

Others

Total

67,750

19,140

19,976

15,500

5,000

1,314

128,680

Auditing fees for INVESTBAK in the year 2016 were 66,000 JOD

Auditing fees for the subsidiary Al Mawared for Financial Brokerage Company in the year 2016 were 8,500 JOD

Auditing fees for the subsidiary Tamkeen Leasing Company in the year 2016 were 7,500 JOD

Auditing fees for the subsidiary Al Istethmari Letamweel Selselat Al Imdad in 2016 were 6,500 JOD

Annual Report 34th

This is an independent unit that studies and deals with complaints of clients and responds to these complaints as quickly as possible. We aim to present the best service to our clients and enforce the loyalty and communication values with them and to satisfy their expectations. The Client Care Department staff strives to carry out all efforts to solve any client complaint and to reduce the permitted timeline to deal with every complaint. This target is achieved by reinforcing the staff knowledge and educating them on banking procedures and regulations

BRANCHES 85 57 9 23

4 8 2 1

42 27 29 25

0 0 15 0

135 36 0 3

1 6 5 1

1 2 0 0

5 2 0 1

0 0 0 9

1 1 0 1

0 3 2 0

274 142

542

62 64

COLLECTION

ELECTRONIC SERVICES DEPARTMENT

INFORMATION TECHNOLOGY DEPARTMENT

SALES

CREDIT AND FACILITIES PROCEDURES/ PRODUCTS DEVELOPMENT DEPARTMENT

LEGAL DEPARTMENT

CASH DEPARTMENT- ATM’S FAILURES – CALL CENTER

COURIER COMPANY / ARAMEX

CHECKBOOKS AND PASSWORDS PRINTING UNIT

TRANSFERS AND OPERATIONS DEPARTMENT- LOAN EXECUTION DEPARTMENT

TOTAL

TOTAL NUMBER OF COMPLAINTS

- All complaints were handled and solved to the satisfaction of clients and according to the policies andprocedures of the Bank.

- A circular was issued to all employees of the Bank stressing the necessity of clarifying commissionscharged by the bank, thus ensuring all clients are fully aware of the commissions charged to their accounts.

- A circular was issued to all employees of the Bank stressing the need to explain to clients the timerequired by the Bank to complete their transactions.

Annual Report 34th

The Bank’s management takes care in attracting qualified candidates for vacant positions, and then the applicants are screened to select the best qualified ones based on the selection standards and the approved hiring policies. This policy guarantees that sufficient numbers of properly qualified staff are available at the proper time and as per the Bank’s organization chart and manpower plans. By following this principle, properly qualified and capable employees are then selected to carry full responsibility to achieve the vision of INVESTBANK and achieve the planned targets. The Bank appointed qualified staff with distinguished experience in the banking field in 2016 to supplement its staffing structure. The number of the Bank’s employees and subsidiary companies in the end of 2016 reached 665 employees.

Following is a presentation of the number of employees as per their qualifications and distribution of staff in the head office, branches and subsidiary companies.

Phd 0

22

396

48

17

25

508

Master degree

Bachelor’s degree

Diploma

General Secondary school

Less than secondary school

Total

• Mr. Khaled Abu Alshaer / Head of Compliance Department resigned on 2016/01/31

• Mr. (Mohammad Ali) Hawash / Head of Internal Audit Department resigned on 2016/07/31

The staff are distributed among the Head Office and branches and the subsidiary companies:Al Istethmari Letamweel Selselat Al Imdad , Al Mawared for Financial Brokerage Company, and Tamkeen Leasing Company and as per the work loads. This guarantees proper execution of the required tasks from each employee and guarantees the highest level of productivity and performance. Following is the number of employees in each location:

305

23

9

11

11

13

11

9

6

6

7

7

11

9

70

508

12

48

16

81

157

Annual Report 34th

Head Office/ Abdul Hamid Sharaf Street

Main Branch / Head Office

Prime clients service center / Head office

Makkah Branch / Makkah Street

Emar Branch / Emar Towers

Taj Mall Branch / Taj Mall

Swaifiyah Branch / Wakalat Street

Wihdat Branch / Al Sharq Al Awsat Roundabout

Sahab Branch / Sahab Industrial City Branch

Zarqa Branch / King Hussain Street

Irbid Branch / Wasfi Eltal Street

Aqaba Branch / Alnahda Street

Abdoun Branch / Suleiman Qidah Street

Dabouq Branch / Mohammad Ahmad Tareef Street

Sales Department

Al Mawared for Financial Brokerage Company / Shmaisani

Al Istethmari Letamweel Selselat Al Imdad / Alqastal

Tamkeen Leasing Company / Makkah Street

Jordan Trade Facilities Company / Shemaisani (A subsidiary of Tamkeen Leasing Company)

Total

Total

1

1

1

1

7

1

4

1

1

1

1

3

1

3

1

1

4

2

6

7

1

2

4

1

3

1

2

2

1

1

1

1

1

Annual Report 34th

In line with the Bank’s policy to develop the skills and abilities of its staff and to enable them to carry out their duties efficiently and productively, which leads to raising the level of service and productivity of the Bank, %29 of the Bank employees participated in specialized training courses and workshops, some of which are:

2nd Annual Product Development Excellence in Banking MENA Allan Llloyds Group

3rd Banks Risks Conference Albaross Consulting

4th Annual Procurement Strategy Summit 2016 Fleming Gulf

Advanced Company Analysis,Valuation &Financial Modelling Euro Money

Advanced Corporate Credit Analysis / Moody's Analytics Banking Studies Institute

Bayt.com's Thought Leader Event Bayt.com

Certified Anti Money Laundering Specialist Banking Studies Institute

Cisco Certified Network Asscociate Specialized Technical Services (STS)

Cisco Otrain

CISSP Specialized Computer Technical Services (STS)

COBIT 5 Samir Abu Tahoon Center (SMT – Center)

COBIT 5 Foundation Risk Management Consultants

COBIT 6 Samir Abu Tahoon Center (SMT – Center

CPA Course Morgan International Jordan

CRISC ISACA Organisation

EBRD TFP Trade Finance Forum EBRD Financial Institutions

EBRD Trade Finance Workshop on Banks Guarantees European Bank for Reconstruction & Development

Enhancing Access to finance for small and medium Enterpresies Jordan Banking Association

Foreign Account Tax Compliance ACT - FATCA Banking Studies Institute

IFRSQ- a Practical guide to missing successful implementations Moody’s Analytics

IFRS 9 Understanding the new regime for financial instruments International Faculty of Finance (IFF)

Implementing CISCO Secure Mobility Otrain

ITIL Foundation V3.5 Specialized Technical Services (STS)

ITIL Foundation V3.6 Specialized Technical Services (STS)

Jordan's Securities Market Jordan Banking Institute

Leadership Skills For Auditors The Institute of internal Auditors

Leadership Skills For Supervisors: Communication,Coaching & Conflict Specialized Technical Services STS

Mobile Payment Security Forum Risk Management Consultants

Newset Trends in Risk Management Solution & KYC Pio Tech

Oracle HCM Cloud Day Jordan Oracle

PCI DSS compliance Business as usual workshop EMP

PCI DSS Version 3.1 Global Business Promotion

PCI Security Standards Council

1

1

16

2

1

1

1

1

2

1

1

2

2

2

1

3

2

3

1

5

2

1

2

1

1

3

1

1

1

5

1

2

4

PMI Professional in Business Analysis Pioneers Academy

Project Management Professional Process & Smith

Real Change Ripple Management / Inhouse

Risk Analyst Analytic Tools and Modelling Workshop Risk Matrix LTD

SIBOS Conference SIBOS

The Advance Executive PA Masterclass Training Appanage Learning & Development

The Regional Compliance Workshop Financial Crime Compliance Academy

The Training and development Show Terrapinn

The Visanet Clearing & Settlement System EMP Emerging Markets Payments

Stores and Warehouse Management London Gate Academy

Preparation of Interior Auditing Report and Currency according to IAA standards

Osool Training and Consultancy

Electronic Archiving and Filing Osool Training and Consultancy

Credit issued based on power of Incoming of Credit International Chamber of Commerce

Qualification Program to pass the certification of accredited money laundering specialist ( CAMS)

Banking Studies Institute

Credit analysis for loan applications by emerging small andmedium enterprises

Global Communities Jordan

Financial Analysis for Loaning Purposes General Union of Banking and Insurance Employess

Labor Regulations ( Jordan Labor Law – Social Insurance Law –Income Tax Law)

Almutaseloon Alawael for Training andConsultancy

Financial and Cash Flow Analysis Banking Studies Institute

Central Bank Guidelines for local and foreign transfers Jordan Banking Association

Central Bank Guidelines for granting credit facilities Jordan Banking Association

Transfers and drafts Banking Studies Institute

Part one – Certified Internal Auditor Certification (CIA) Banking Studies Institute

International Standard for Financial Reports 9 Albatross Consulting

International Standard for Financial Reports 9 Jordan Banking Association

Issued Guarantees Jordan Banking Association

Advanced Skills in Health Insurance Knowledge Kingdom for Consultancy and Training

Advanced Skills in Electronic Office Management and Organizing Knowledge Kingdom for Consultancy and Training

Guarantee Program for Emerging Small Enterprises Jordan Banking Association

CICS Osool Training and Consultancy

Specialized Vocational Diploma in Financial Analysis Program Banking Studies Institute

Clearing of net results for cards activity based on Real Time Gross Settlement System (RTGS)

Central Bank

Affect of Recommendation 16 issued by FATF on banking activitiesof clients’ transfers

Arab Academy for Financial and Banking Sciences

Application of Automatic Clearing House (ACH) Central Bank

Annual Report 34th

Annual Report 34th

2

3

1

11

3

7

1

3

2

1

1

2

1

1

2

15

3

1

1

2

2

1

New Procedures in developing Stress Testing Albatross Consulting

New Amendment to Basel 3 Albatross Consulting

Enforcement of supervisory and regulatory bodies and reduction of risks related to corresponding banks De Risking

Arab Banks Federation

Evaluating , financing and monitoring projects Banking Studies Institute

Accounting Standards No. 9 Albatross Consulting

Developing skills and behavior of tellers and client relations employees in banks and financial institutions

Banking Studies Institute

Financing small and medium projects Jordan Banks Association

Swift transfers Banking Studies Institute

Banking forgery and counterfeit detection Banking Studies Institute

Master of business administration Open Arab University

Bank methods of handling international sanctions and embargo AZ International

Internal auditing standards as per the standards of international internal auditors institute IIA

Osool Training and Consultancy

Health and vocational safety supervisor Jordan Pulse Academy

New International Financial Report Standard No. 16 related to accomplishments

Jordan Securities Commission

Time management and work pressure management skills Banking Studies Institute

Excellence skills in clients relation service Banking Studies Institute

41st Arab dealers conference Financial Markets Association

Power efficiency application workshop Jordan Banks Association

Common Reporting Standards Symposium – Challenges and suggested solutions

Jordan Banks Association

Introduction workshop to the updates on the execution departmenton the Amman Trial Court

Ministry of Justice

Workshop on dealing with sovereign financial instruments and the Jordan capital market

Central Bank

Compliance function in accordance with the guidelines of combating money laundering and financing of terrorism

Albatross Consulting

The Bank adopts a clear policy of calculating employees’ perks based on return on equities compared to the anticipated return for the same year. Portions of the allocation of perks are executed as delayed payment units as per the bank approved policies and based on the evaluation of the annual performance of employees and on achieving the targets allocated to them, and these are divided into financial, supervisory and managerial targets.

NAMES AND CURRICULUM VITAES OF MEMBERS OF THE BOARD OF DIRECTORS

Annual Report 34th

1961

2008/5/26

CHAIRMAN OF THE BOARD Abdul Rahim Jardaneh and Sons Co.

NO. OF SHARES OF THE BANK’S CAPITAL OWNED BY THE MEMBER 185,581NAME OF THE INDIVIDUAL REPRESENTING THE LEGAL ENTITY Mr. Bisher MohammaAbdulRahim Jardaneh NO. OF SHARES OWNED BY THE REPRESENTING PERSON

DATE OF BIRTH

DATE OF JOINING THE BOARD

NATURE OF MEMBERSHIP Non executive / Not independent

ACADEMIC QUALIFICATION

EXPERIENCE AND POSTS HELD

- Executive General Manager / Arabtec Jardaneh Group Co.- Member of the Greater Amman Municipal Board- Member of the Board of Trustees of Cooperation Organization(Welfare ) / Geneva, and Head of the Strategy and GovernanceCommittee- Member of the Board, Jordan Investment Promotion Authority- Member of the Board / Almafraq Development Organization- Vice Chairman of the Board, Jordanian Strategy Forum- Vice Chairman – Zaha Children Organization- Member of the Board, Arab Orphans Committee- Chairman of the Arab Cultural Society

Mr. Jardaneh also held the following posts:- Member of the Executive Committee of the InternationalFederation of Consulting Engineers (FIDIC) / Geneva.- Member of the Royal All Jordan Committee- Member of the Royal Committee for Water in Jordan- Member of Investment Fund of Jordan Social SecurityOrganization.- Member of the Board / Nugul Group of Companies.- Member of the Board, Jordan Economic Development Council(JEDCO).- Chairman of the Board, Jordan Engineering and ArchitecturalBusiness Forum.- Committee Member, Jordan National Agenda Committee.- Member of the Young Presidents Organizations WPO –YPO.- Member /Jordanian Engineering Association- Member of Jordanian Businessmen Association, US-JordanBusinessmen Association and European – Jordanian BusinessmenAssociation

-BSC (Honor) in civil engineering , 1982 from Illinois University(Urbana-Champaign) – USA-MSC (Honor) , 1985 in construction management from

University of California – Berkeley – USA

Annual Report 34th

30/04/2006

57,5611961

VICE CHAIRMAN OF THE BOARD

NO. OF SHARES OF THE BANK’S CAPITAL OWNED BY THE MEMBERNAME OF THE INDIVIDUAL REPRESENTING THE LEGAL ENTITYNO. OF SHARES OWNED BY THE REPRESENTING PERSON

DATE OF BIRTH


NATURE OF MEMBERSHIP



Annual Report 34th


MEMBER OF THE BOARD Dr. Nabil Hani Jamil Qaddumi

NO. OF SHARES OWNED BY THE MEMBER OF THE BANK’S CAPITAL 2,153,936

DATE OF BIRTH 1954

DATE OF JOINING THE BOARD 01/01/2000

NATURE OF MEMBERSHIP Non executive / Non independent

ACADEMIC QUALIFICATION 1982 , Phd, Civil Engineering, Massachusetts Institute of Technology (USA)MSc Civil Engineering, Stanford University (USA),1977BSc , Civil Engineering, University of Texas, Austin (USA) 1976American University of Beirut, 1972 - 1975 , Civil Engineering

- Chairman of the Board, Projacs International (www.projeacs.com)- Chairman of the Board, Safwan Petroleum Technologies Co.(www.spetco.com)- 1982 -1994 Lecturer, Faculty of Engineering / University of Kuwait- 1989-1991Visiting Professor, Faculty of Engineering / StanfordUniversity- 2008 – 2014 Chairman, of the Board of - 2008 – present, Palestine Governor, Arab Fund for Economic and SocialDevelopment- Chairman of Hani Qaddumi Scholarship Foundation-

Annual Report 34th

VICE CHAIRMAN OF THE BOARD Raouf Abu Jaber and Sons Co.

NO. OF SHARES OF THE BANK’S CAPITAL OWNED BY THE MEMBER 9 088

NATURE OF MEMBERSHIP Non executive / Not independent

NAME OF THE INDIVIDUAL REPRESENTING THE LEGAL ENTITY Mr. Emad Nihad Khalil jeryes (starting 12/02/2014)

NO. OF SHARES OF THE BANK’S CAPITAL OWNED BY THE MEMBER

DATE OF BIRTH 1960

0 000

ACADEMIC QUALIFICATION BSc Commerce and Business Administration / Beirut Arab University


– General Manager, United Insurance Co.- Member of the Board, Jordan Union of Insurance Co., andHead of the Audit Committee.- Member of the Board , Jordan Paper and Cardboard Factories,and member of the Audit Committee.- General Manager, Arab European Insurance Co.- Deputy General Manager, Arab Eagle Insurance Co.

Annual Report 34th

NATURE OF MEMBERSHIP Non executive / Non independent


MEMBER OF THE BOARD Jordan Drugstore Co.

NO. OF SHARES OF THE BANK’S CAPITAL OWNED BY THE MEMBER 1,009,479

NAME OF THE INDIVIDUAL REPRESENTING THE LEGAL ENTITY Abdul Rahim Nizar Abdul Rahim Jardaneh

NO. OF SHARES OWNED BY THE REPRESENTING PERSON 8,431,216

DATE OF BIRTH 1962


ACADEMIC QUALIFICATION BSc Pharmacy, Minnesota University – USA 1984

-Chairman of the Board, Dar Al Dawa Development and Investment Co.-Chairman of the Board, Nutri Dar Co.-Member of the Board, Jordan Drugstore Co.

Annual Report 34th

MEMBER OF THE BOARD Mr. Fahmi Bin Fayeq Bin Fahmi Abu Khadra


DATE OF BIRTH 1964


NATURE OF MEMBERSHIP Non executive / independent

ACADEMIC QUALIFICATION MSc Business Administration

1987 – 1989 Credit Facilities Off cer / Arab Bank Head Off ce- 1989 – 2001 General Manager, Alriyadh Medical Services Co.-1991 – 2001 Member of the Board of Directors, Amman Surgical Hospital-2003 Chairman of the Board, Amman Surgical Hospital-1997 , Saudi Arabia, General Manager United PharmaceuticalManufacturing Co.-2004, Saudi Arabia, Manager, Medicinal Products and Rubber Factory-2007, Saudi Arabia , General Manager, Care Corporation-1999, Chairman of the Board, Switchers Limited, Britain.


MEMBER OF THE BOARD Mrs. Wijdan “Mohammad Yaseen” Khalil Altalhouni


DATE OF BIRTH 1939


NATURE OF MEMBERSHIP Non executive / independent

ACADEMIC QUALIFICATION BSc, Economy and Political Science

-1968 – 1973 Central Bank, Research and Studies Department.-Member of the Board of Director, Grand Flour Mills of Zarka.-Vice Chairman of the Board, Multaqa Altadawul Joint Stock Co.-Member of the Board of Directors: Investment , Trade and Export Co.-Member of Jordan Businessmen Association, and a member of thefollowing committees:-Finance & Economy Committee-Manufacturing Committee-Commercial Committee.-Member of the Board, Arab Business Women - Head of ProjectsCommittee-Chairman of the Board of Trustees, Jordan Business and professionalwomen Forum


Annual Report 34th

MEMBER OF THE BOARD PALESTINE BANK CO.

NO. OF SHARES OF THE BANK’SCAPITAL OWNED BY THE MEMBER 9,420,627NAME OF THE INDIVIDUAL REPRESENTING THE LEGAL ENTITY Mr Rushdi Mahmoud Rasheed Alghalayeeni (starting 30/04/2014)NO. OF SHARES OWNED BY THE REPRESENTING PERSON -

DATE OF BIRTH 1962

ACADEMIC QUALIFICATION BSc (Honors) , Economy and Computer Sciences, American University of Cairo, Egypt, 1986 Certificat in Assessing and managing risks in banks, Cairo

EXPERIENCE AND POSTS HELD 1989 joined the Bank of Palestine 2008 till the present Deputy General Manager, Bank of Palestine

Annual Report 34th

DATE OF


MEMBER OF THE BOARD


DATE OF BIRTH



- Member of the Board Jordan Drugs Store.


MEMBER OF THE BOARD


DATE OF BIRTH





Annual Report 34th

MEMBER OF THE BOARD Mr. Hani Ibrahim Suleiman Fadayel

NO. OF SHARES OF THE BANK’SCAPITAL OWNED BY THE MEMBER 5320

DATE OF BIRTH 1952


NATURE OF MEMBERSHIP Non executive / Independent

ACADEMIC QUALIFICATION -BSc/ Business Administration, University of Jordan 19751975 – 1985 Citibank, Jordan-1985 – 2009, Regional Manager, Arab Bank , Bahrain- 2010 till the present, General Manager, Fadayel AdministrativeConsultancy Co.- 2009 – 2010 , Assistant General Manager, Arab Bank , Amman /Jordan- 2010 – present, Member of the Board and Head of RisksManagement Department, BankMed/ Lebanon- 2011 – present, Member of the Board, GroupMed International,Lebanon.


NAME Mr. Bassam Mustafa Amin Hammad

POSITION

ACADEMIC QUALIFICATION BSc Accountancy / Business Administration

YEAR OF GRADUATION 1979

DATE OF APPOINTMENT 12/6/1983

DATE OF BIRTH 1952

1980 – 1983 Southern Cement Company1983 – 2007 INVESTBANK2008 – present, Secretary General of the Board of DirectorsFormer Member of the Board of Directors in the following companies:- Aldaman Investment Company- Bank Alquds- Woolen Industries Company- Aqaba Vegetable Oils Refining Company


Annual Report 34th

Annual Report 34th

CONSOLIDATEDFINANCIALSTATEMENTS

Annual Report 34th

DECEMBER 31 2016

-

Annual Report 34th

Annual Report 34th

TO THE SHAREHOLDERS OF INVEST BANK

In our opinion, the financial statements present fairly, in all material respects the financial position of Invest Bank (publicly listed Company) as at 31 December 2016, and its financial performance and its cash flows for the year then ended in accordance with International Financial Reporting Standards.

The Group’s consolidated financial statements comprise• the consolidated statement of financial position as at December 2016 ,31;• the consolidated statement of comprehensive income for the year then ended;• the consolidated statement of changes in equity for the year then ended;• the consolidated statement of cash flows for the year then ended; and• the notes to the consolidated financial statements, which include a summary of significantaccounting policies.

We conducted our audit in accordance with International Standards on Auditing (ISAs). Our responsibilities under those standards are further described in the Auditor’s Responsibilities for the Audit of the consolidated Financial Statements section of our report.

We are independent of the Bank in accordance with the International Ethics Standards Board for Accountants’ Code of Ethics for Professional Accountants (IESBA Code). We have fulfilled our other ethical responsibilities in accordance with the IESBA Code.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Key Audit Matters Provision for impairment in direct credit facilities

Acquisition of a subsidiary

Overview

Provision for impairment in direct credit facilities We have performed the following procedures to assess the reasonableness of the Provision for impairment in direct credit facilities.

Annual Report 34th

As part of designing our audit, we determined materiality and assessed the risks of material misstatement in the consolidated financial statements. In particular, we considered where the directors made subjective judgments; for example, in respect of significant accounting estimates that involved making assumptions and considering future events that are inherently uncertain. As in all of our audits, we also addressed the risk of management override of internal controls, including among other matters consideration of whether there was evidence of bias that represented a risk of material misstatement due to fraud.

We tailored the scope of our audit in order to perform sufficient work to enable us to provide an opinion on the consolidated financial statements as a whole, taking into account the structure of the Bank, the accounting processes and controls, and the industry in which the Bank operates.

Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the consolidated financial statements of the current period. These matters were addressed in the context of our audit of the consolidated financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters.

As described in the accounting policies (2.10) ,(2.6) and note number (3) Critical Accounting Estimates And Judgments, the management calculates the provision for impairment in direct credit facilities according to the accounting policies described in note (2.10) (2.6) and in accordance with Central Bank of Jordan related instructions. The Management reviews the contracts individually or in group to assess whether there is objective evidence of impairment such as default in payments of customers. In case evidence exist the management assess the impairment value based on the recoverable amount from the assets mortgaged to the Bank and in accordance with the International Financial Reporting Standards and Central Bank of Jordan Instructions.

Due to the importance of these estimates and judgments, It is considered as significant risk which might lead to material misstatement in the consolidated financial statements when available information and estimates are misused to determine the provision value.As disclosed in Note (10) to the consolidated financial statements, management had recognised a provision for impairment in direct credit facilities with an amount of JD 23,314,696, while net direct credit facilities amounted to JD 538,630,285 which represents %56 of the group total assets as at 31 December 2016.

• Understood the nature of credit facilities.• Assessed management's methodology inclassifying loans and the method used indetermining the recoverable amount from themortgaged assets when sold and expected cashflow.• Tested sample of customers classified asnon-performing customers to check thereasonableness of their classification• Tested the information systems of the bank andthe automatic classification of the non-performingloans.• Assessed management's methodology inassessing the required provision as at 31December 2016.• Assessed the key assumptions used, based onour understanding of the group and the nature ofthe business.• Tested sample of management estimates of therecoverable amounts from the sale of mortgagedassets.• Tested select of relevant procedures andinternal controls applied by the management.• Re-calculated the provision for impairment indirect credit facilities for a sample of customers inaccordance with the International FinancialReporting Standards and Central Bank of JordanInstructions.• Assess the adequacy of disclosures over theprovision for impairment in direct credit facilities.

Acquisition of a subsidiary We have performed the following procedures regarding the acquisition process of Jordan trade facilities company:2.10) ,(2.6) The bank acquired %93,275 of Jordan Trade

Facilities company which owns %100 of Trade Facilities for Finance Leasing Company during the year 2016, through its subsidiary (Tamkeen Leasing Company), through a purchase of 15,390,385 shares with 1JD par value. The acquisition cost was JD 20,774,620 which resulted in a goodwill amounted to JD 1,430,598 disclosed under intangible assets. The acquisition process requires the management to use its professional judgement in determining the fair value of the net assets at the date of acquisition and determine the goodwill value in accordance with International financial Reporting standards.

Due to the importance of these estimates it is considered a key audit matter

As disclosed in Note (24-2) (Intangible assets) The goodwill represent the positive difference between the cost of acquisition or purchase price of the associate or subsidiary and the company’s net asset fair value at the date of acquisition. Impairment test for goodwill is performed at the date of each financial statement, and impairment is booked when there is objective evidence that the goodwill is impaired and the impairment loss is recorded in the income statement

• Assessed the Bank ability to control the relevantfinancial and operating policies of Jordan TradeFacilities Company.

• Assessed the computation of fair value of the netassets at and goodwill at the date of acquisition, inaddition to reviewing the specialist reports assignedby the bank for the acquisition process.

• Assessed the assumptions used in determiningthe value fair value.• Assessed the calculation of non-controllinginterest in net income and net assets of JordanTrade Facilities Company.

• Assessed the impairment test of the goodwill thatwas performed by the bank at year end.

• Assess the adequacy of disclosures overacquisition of a subsidiary.

Annual Report 34th

The directors are responsible for the other information. The other information comprises all the other information included in the Bank’s annual report for the year 2016 but does not include the consolidated financial statements and our auditor’s report thereon.

Our opinion on the consolidated financial statements does not cover the other information and we do not and will not express any form of assurance conclusion thereon.

In connection with our audit of the consolidated financial statements, our responsibility is to read the other information identified above and, in doing so, consider whether the other information is materially inconsistent with the consolidated financial statements or our knowledge obtained in the audit, or otherwise appears to be materially misstated.

We read the other information, and there is no material misstatement therein, to communicate to those charged with governance.

Management is responsible for the preparation and fair presentation of the financial statements in accordance with International Financial Reporting Standards, and for such internal control as management determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the financial statements, management is responsible for assessing the Bank’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Bank or to cease operations, or has no realistic alternative but to do so.

Those charged with governance are responsible for overseeing the Bank’s financial reporting process.

Annual Report 34th

Annual Report 34th

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.

As part of an audit in accordance with ISAs, we exercise professional judgment and maintain professional scepticism throughout the audit. We also:

• Identify and assess the risks of material misstatement of the financial statements, whether due to fraud orerror, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficientand appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resultingfrom fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentionalomissions, misrepresentations, or the override of internal control.

• Obtain an understanding of internal control relevant to the audit in order to design audit procedures that areappropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of theBank’s internal control.

• Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates andrelated disclosures made by management.

• Conclude on the appropriateness of management’s use of the going concern basis of accounting and, based onthe audit evidence obtained, whether a material uncertainty exists related to events or conditions that may castsignificant doubt on the Bank’s ability to continue as a going concern. If we conclude that a material uncertaintyexists, we are required to draw attention in our auditor’s report to the related disclosures in the financialstatements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the auditevidence obtained up to the date of our auditor’s report. However, future events or conditions may cause the Bankto cease to continue as a going concern.

• Evaluate the overall presentation, structure and content of the financial statements, including the disclosures,and whether the financial statements represent the underlying transactions and events in a manner that achievesfair presentation.

Annual Report 34th

We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.

We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.

From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the consolidated financial statements of the current period and are therefore the key audit matters. We describe these matters in our auditor’s report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.

The Bank maintains proper accounting records and the accompanying consolidated financial statements are in agreement therewith the financial date presented in the Board of Directors’ report. We recommended that the General assembly of Shareholders approve these financial statements.

Amman - Jordan30 March 2017

6

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Annual Report 34th

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,083

)

24,1

97,1

08

(7,7

25,7

03)

16,4

71,4

05

(2,8

46,3

89)

(6,7

48,4

98)

534,

487

149,

832

1,55

4,59

296

2,43

5

(45,

212,

272)

71,6

34,3

6368

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(72,

698,

279)

(1,8

08,3

39)

(9,7

00,0

00)

17,6

06(4

79,2

32)

19,0

00(2

62,3

06)

(20,

774,

618)

375,

979

- -(2

4,27

1,51

0)7,

304,

323

(8,0

00,0

00)

(7,0

00,0

00)

25 17 30

41,5

01,8

2213

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33,5

01,8

2241

,809

37,2

6043

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,681

25,7

38,9

7713

6,98

0,54

0

162,

719,

517

29,0

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84,1

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1,80

9)

(115

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)

(962

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)

(43,

051)

(39,

303)

6 6 7 10 13 15 16 20 8

Inve

st B

ank

(the

“Ban

k”) w

as e

stab

lishe

d as

a J

orda

nian

pub

lic s

hare

hold

ing

com

pany

und

er r

egis

trat

ion

No.

(173

) dat

ed 1

2 Au

gust

198

2 in

acc

orda

nce

with

the

Com

pani

es L

aw N

o. (1

2) fo

r th

e ye

ar 1

964

with

a p

aid

in c

apita

l of J

D 6

mill

ion

dist

ribu

ted

over

6 m

illio

n sh

ares

with

a p

ar v

alue

of J

D 1

per

sha

re.T

he B

ank’

s ca

pita

l was

incr

ease

d se

vera

l tim

es to

bec

ome

JD 7

7,50

0,00

0 / J

D 1

per

sha

re a

s of

31

Dec

embe

r 20

10.

Furt

herm

ore,

dur

ing

2011

, the

Ban

k’s

capi

tal w

as in

crea

sed

to J

D 8

5,25

0,00

0 / J

D 1

per

sha

re. F

inal

ly,

the

Ban

k’s

capi

tal w

as in

crea

sed

by J

D 1

4,75

0,00

0 on

10

Apri

l 201

2. A

ccor

ding

ly, t

he B

ank’

s au

thor

ized

and

paid

in c

apita

l bec

ame

JD 1

00 M

illio

ns /

JD 1

per

sha

re.

The

Ban

k’s

Hea

d O

ffice

is lo

cate

d in

Am

man

, Abd

Alh

amee

d Sh

araf

Str

eet,

Shm

esan

i, Te

l: 50

0150

0, P

.O B

ox 9

5060

1, A

mm

an –

111

95 J

orda

n.

The

Ban

k pr

ovid

es b

anki

ng a

nd r

elat

ed fi

nanc

ial s

ervi

ces

thro

ugh

its H

ead

Offi

ce a

nd T

wel

ve b

ranc

hes

in th

e H

ashe

mite

Kin

gdom

of J

orda

n, a

nd it

s su

bsid

iari

es.

Inve

st B

ank

is a

pub

lic s

hare

hold

ing

com

pany

list

ed in

Am

man

Sto

ck E

xcha

nge

Thes

e co

nsol

idat

ed fi

nanc

ial s

tate

men

ts h

ave

been

app

rove

d by

2.1

B

asis

of p

repa

ratio

n

The

acco

mpa

nyin

g co

nsol

idat

ed fi

nanc

ial s

tate

men

ts fo

r th

e ye

ar e

nded

31

Dec

embe

r 20

16 o

f the

Ban

k an

d it

s su

bsid

iari

es a

re p

repa

red

in a

ccor

danc

e w

ith th

e st

anda

rds

issu

ed b

y th

e In

tern

atio

nal A

ccou

ntin

g St

anda

rds

Boa

rd (I

ASB

), in

terp

reta

tions

issu

ed b

y th

e Co

mm

ittee

of t

he IA

SB, p

reva

iling

loca

l law

s an

d re

gula

tions

of t

he

Cent

ral B

ank

of J

orda

n.

The

cons

olid

ated

fina

ncia

l sta

tem

ents

are

pre

pare

d un

der

the

hist

oric

al c

ost c

onve

ntio

n, e

xcep

t for

fina

ncia

l as

sets

at f

air

valu

e th

roug

h pr

ofit o

r lo

ss, fi

nanc

ial a

sset

s at

fair

val

ue th

roug

h ot

her

com

preh

ensi

ve in

com

e th

at h

ave

been

mea

sure

d at

fair

val

ue a

t the

dat

e of

thes

e co

nsol

idat

ed fi

nanc

ial s

tate

men

ts. H

edge

d as

sets

and

liab

ilitie

s ar

e al

so s

tate

d at

fair

val

ue.

The

repo

rtin

g cu

rren

cy o

f the

se c

onso

lidat

ed fi

nanc

ial s

tate

men

ts is

the

Jord

ania

n D

inar

whi

ch is

the

func

tiona

l cu

rren

cy o

f the

Ban

k.

The

acco

untin

g po

licie

s ap

plie

d in

pre

pari

ng th

e fin

anci

al s

tate

men

t for

the

year

end

ed 3

1 D

ecem

ber

2016

are

cons

iste

nt w

ith th

ose

used

in th

e ye

ar e

nded

31

Dec

embe

r 20

15 e

xcep

t for

the

info

rmat

ion

pres

ente

d in

note

(2-2

).

22,3

78,2

2620

,604

,844

2,85

2,14

92,

759,

899

(894

,045

)(3

,303

,506

)13

,466

7,30

716

3,29

526

4,51

2

8

2016

2015

Net

cas

h us

ed in

inve

stm

ent i

n su

bsid

iari

esN

et c

ash

gene

rate

d fr

om in

vest

men

t in

subs

idia

ries

Div

iden

ds p

aid

Bor

row

ed fu

nds

Effe

ct o

f exc

hang

e ra

te fl

uctu

atio

ns o

n ca

sh a

nd c

ash

equi

vale

nts

Net

incr

ease

in c

ash

and

cash

equ

ival

ents

Net

cas

h fl

ows

(use

d in

) gen

erat

ed fr

om in

vest

ing

activ

ities

Net

cas

h fl

ows

gene

rate

d fr

om fi

nanc

ing

activ

ities

Fina

ncin

g ac

tiviti

es

42

Annu

al R

epor

t 34

th

The

prin

cipa

l acc

ount

ing

polic

ies

appl

ied

in t

he p

repa

ratio

n of

the

se c

onso

lidat

ed fi

nanc

ial s

tate

men

ts f

or t

he

year

end

ed 3

1 D

ecem

ber

2015

exc

ept

for

the

impl

emen

tatio

ns o

f ne

w s

tand

ards

and

am

endm

ents

on

exis

ting

stan

dard

s as

men

tione

d be

low

:

(a)

New

sta

ndar

ds, a

men

dmen

ts a

nd in

terp

reta

tions

ado

pted

by

the

Ban

k

The

Ban

k ha

s ap

plie

d th

e fo

llow

ing

stan

dard

s an

d am

endm

ents

for

the

first

tim

e fo

r th

eir

annu

al r

epor

ting

peri

od c

omm

enci

ng 1

Jan

uary

201

6, w

hich

doe

s no

t hav

e a

mat

eria

l eff

ect o

n th

e ba

nks

finan

cial

sta

tem

ents

:

-Am

endm

ent t

o (IA

S 16

) Pro

pert

y, p

lant

and

equ

ipm

ent a

nd (I

AS 3

8) In

tang

ible

ass

ets

whi

ch r

epre

sent

s th

eac

cept

able

met

hods

for

depr

ecia

tion

and

amor

tizat

ion.

-Am

endm

ents

to IA

S (3

4) “

Fina

ncia

l sta

tem

ents

” re

gard

ing

the

disc

losu

res

in th

e fin

anci

al s

tate

men

ts.

-Am

endm

ent t

o IA

S (1

9) “

Empl

oyee

s be

nefic

iary

pla

n” th

at r

equi

re th

e us

e of

dis

coun

ted

curr

ency

rat

e to

mee

t the

obl

igat

ions

from

em

ploy

ee b

enefi

ciar

y pl

an.

-Am

endm

ent t

o IA

S (2

7) “

Sepa

rate

Fin

anci

al S

tate

men

t” r

esto

re th

e op

tion

of u

sing

equ

ity m

etho

d fo

r en

titie

sin

sep

arat

e fin

anci

al s

tate

men

t to

acco

unt f

or in

vest

men

ts in

sub

sidi

arie

s, a

ssoc

iate

s an

d jo

int v

entu

res.

-Am

endm

ent t

o IA

S (1

) “Pr

esen

tatio

n of

Fin

anci

al S

tate

men

ts”

clar

ify th

e re

quir

emen

t for

fina

ncia

l sta

tem

ent

pres

enta

tion

and

acco

untin

g po

licie

s di

sclo

sure

s.-

Amen

dmen

t to

IFR

S (7

) “Fi

nanc

ial i

nstr

umen

ts: D

iscl

oser

s” th

at r

equi

re d

iscl

osur

e of

info

rmat

ion

abou

tsi

gnifi

cant

fina

ncia

l ins

trum

ents

aft

er s

ale

and

disc

lose

the

clea

ranc

e be

twee

n fin

anci

al a

sset

s an

d fin

anci

allia

bilit

ies

and

was

not

men

tion

in IA

S (3

4)-

Amen

dmen

t to

IFR

S (1

1) “

Join

t agr

eem

ent”

whi

ch p

rovi

de a

spe

cific

met

hod

for

calc

ulat

ing

the

acqu

isiti

on in

a jo

int a

gree

men

t.-

Amen

dmen

t to

IFR

S (1

0) “

Cons

olid

ated

fina

ncia

l sta

tem

ents

” an

d IA

S (2

8) “

Inve

stm

ent i

n as

soci

ates

the

elim

inat

ion

for

conc

iliat

ed fi

nanc

ial s

tate

men

ts fo

r In

vest

men

t com

pani

es a

nd s

ubsi

diar

ies.

-An

nual

impr

ovem

ents

to IF

RS

2014

-201

2 Cy

cle.

(b)

New

sta

ndar

ds, a

men

dmen

ts a

nd in

terp

reta

tions

not

yet

ado

pted

-IF

RS

9 Fi

nanc

ial I

nstr

umen

ts: I

FRS

9 ad

dres

ses

the

clas

sific

atio

n, m

easu

rem

ent a

nd d

erec

ogni

tion

offin

anci

al a

sset

s an

d fin

anci

al li

abili

ties

and

intr

oduc

es n

ew r

ules

for

hedg

e ac

coun

ting.

The

IASB

mad

e fu

rthe

rch

ange

s to

the

clas

sific

atio

n an

d m

easu

rem

ent r

ules

and

als

o in

trod

uced

a n

ew im

pair

men

t mod

el. T

he n

ewfin

anci

al in

stru

men

ts s

tand

ard

mus

t be

appl

ied

for

finan

cial

yea

rs c

omm

enci

ng o

n or

aft

er 1

Jan

uary

201

8.

-IF

RS

15 R

even

ue fr

om C

ontr

acts

with

Cus

tom

er: T

he IA

SB h

as is

sued

a n

ew s

tand

ard

for

the

reco

gniti

on o

fre

venu

e. T

his

will

rep

lace

IAS

18 w

hich

cov

ers

cont

ract

s fo

r go

ods

and

serv

ices

and

IAS

11 w

hich

cov

ers

cons

truc

tion

cont

ract

s. T

he n

ew s

tand

ard

is b

ased

on

the

prin

cipl

e th

at r

even

ue is

rec

ogni

zed

whe

n co

ntro

l of a

good

or

serv

ice

tran

sfer

s to

a c

usto

mer

– s

o th

e no

tion

of c

ontr

ol r

epla

ces

the

exis

ting

notio

n of

ris

ks a

ndre

war

ds. T

he s

tand

ard

perm

its a

mod

ified

ret

rosp

ectiv

e ap

proa

ch fo

r th

e ad

optio

n. T

he s

tand

ard

shou

ld b

ead

opte

d m

anda

tory

for

finan

cial

yea

rs c

omm

enci

ng o

n or

aft

er 1

Jan

uary

201

8.

-IF

RS

(16

) “Le

ases

” m

ust b

e ap

plie

d fo

r fin

anci

al y

ears

com

men

cing

on

1 Ja

nuar

y 20

19, t

hat w

ill r

epla

ce IA

S(1

7)“L

ease

s” w

hich

set

s ou

t the

pri

ncip

les

for

the

reco

gniti

on, m

easu

rem

ent,

pres

enta

tion

and

disc

losu

re o

fle

ases

.

-IA

S (1

2) “

Inco

me

Tax”

mus

t be

appl

ied

for

finan

cial

yea

rs c

omm

enci

ng o

n 1

Janu

ary

2017

. Add

ress

es th

em

easu

rem

ents

and

rec

ogni

tion

for

diffe

red

tax

asse

ts.

-IA

S (7

) “St

atem

ent o

f cas

h flo

w”

mus

t be

appl

ied

for

finan

cial

yea

rs c

omm

enci

ng o

n 1

Janu

ary

2017

.Ad

dres

ses

the

addi

tiona

l dis

clos

ure

rega

rdin

g th

e ch

ange

in li

abili

ties

resu

lting

from

fina

ncin

g ac

tiviti

es.

The

cons

olid

ated

fina

ncia

l sta

tem

ents

incl

ude

the

finan

cial

sta

tem

ents

of t

he B

ank

and

the

who

lly o

wne

d su

bsid

iary

com

pani

es c

ontr

olle

d by

it. C

ontr

ol e

xist

s w

hen

the

Ban

k ha

s th

e ab

ility

to c

ontr

ol th

e fin

anci

al a

nd

oper

atin

g po

licie

s of

the

subs

idia

ry c

ompa

nies

in o

rder

to a

chie

ve fi

nanc

ial b

enefi

ts o

ut o

f the

ir o

pera

tions

. All

inte

r-co

mpa

ny tr

ansa

ctio

ns, b

alan

ces,

rev

enue

s an

d ex

pens

es b

etw

een

the

Ban

k an

d its

sub

sidi

arie

s ar

e el

imin

ated

, as

wel

l as

betw

een

the

subs

idia

ries

them

selv

es.

The

cons

olid

ated

fina

ncia

l sta

tem

ents

con

tain

s th

e ba

nks

finan

cial

sta

tem

ent a

nd it

s fo

llow

ing

subs

idia

ries

:

*Jo

rdan

Com

pany

for

Fact

orin

g w

as e

stab

lishe

d on

21

Dec

embe

r 20

11 a

nd h

as n

ot c

omm

ence

d its

ope

ratio

nsas

of t

he d

ate

of th

ese

cons

olid

ated

fina

ncia

l sta

tem

ents

.

* *

The

ban

k ac

quir

ed %

93,2

75 o

f Jor

dan

Trad

e Fa

cilit

ies

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pany

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ch o

wns

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de F

acili

ties

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nce

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ing

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ing

the

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roug

h its

sub

sidi

ary

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keen

Lea

sing

Com

pany

),th

roug

h a

purc

hase

of 1

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0,38

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ares

with

1JD

par

val

ue. T

he a

cqui

sitio

n co

st w

as J

D 2

0,77

4,62

0 an

d t

he fa

ir v

alue

of n

et a

sset

s am

ount

ed to

JD

19,

344,

022

at th

e da

te o

f acq

uisi

tion,

whi

ch r

aise

d a

good

will

amou

nted

to J

D 1

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dis

clos

ed u

nder

inta

ngib

le a

sset

s.

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finan

cial

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tem

ents

of t

he s

ubsi

diar

ies

are

prep

ared

usi

ng th

e sa

me

acco

untin

g po

licie

s ad

opte

d by

th

e B

ank.

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nges

are

mad

e to

the

acco

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g po

licie

s of

sub

sidi

arie

s, w

hen

nece

ssar

y, to

alig

n th

em w

ith

acco

untin

g po

licie

s ad

opte

d by

the

Ban

k

The

bank

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ect a

nd in

dire

ct in

vest

emen

ts in

trad

e fa

cilit

ies

for

finan

ce le

asin

g is

%94

,667

as o

f 3

1 D

ecem

ber

2016

.

The

finan

cial

sta

tem

ents

of t

he s

ubsi

diar

ies

are

prep

ared

usi

ng th

e sa

me

acco

untin

g po

licie

s ad

opte

d by

th

e B

ank.

Cha

nges

are

mad

e to

the

acco

untin

g po

licie

s of

sub

sidi

arie

s, w

hen

nece

ssar

y, to

alig

n th

em w

ith a

ccou

ntin

g po

licie

s ad

opte

d by

the

Ban

k.

Subs

idia

ries

are

inve

stee

s co

ntro

lled

by th

e B

ank.

The

fina

ncia

l sta

tem

ents

of t

he s

ubsi

diar

ies

are

incl

uded

in

the

cons

olid

ated

fina

ncia

l sta

tem

ents

from

the

date

the

Ban

k ob

tain

s co

ntro

l of t

he in

vest

ee a

nd c

ease

s w

hen

the

Ban

k lo

ses

cont

rol o

f the

inve

stee

.

Non

-con

trol

ling

inte

rest

rep

rese

nts

the

port

ion

of n

et p

rofit

or

loss

and

net

ass

ets

not o

wne

d di

rect

ly

or in

dire

ctly

by

the

Ban

k in

its

subs

idia

ries

and

are

pre

sent

ed in

the

cons

olid

ated

sta

tem

ent o

f inc

ome

and

with

in e

quity

in th

e co

nsol

idat

ed s

tate

men

t of fi

nanc

ial p

ositi

on s

epar

atel

y fr

om th

e eq

uity

att

ribu

tabl

e to

the

shar

ehol

ders

of t

he B

ank.

Jord

ania

n Co

mpa

ny fo

r Fa

ctor

ing

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Fina

ncia

l se

curi

ties

bro

kera

ge

Leas

e fin

anci

nM

anag

emen

t an

d op

erat

ion

of

bond

ed s

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s

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2010

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Jord

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faci

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94.7

2016

An

nual

Rep

ort

34th

A bu

sine

ss s

egm

ent i

s a

grou

p of

ass

ets

or o

pera

tions

join

tly e

ngag

ed in

pro

vidi

ng a

n in

divi

dual

pro

duct

or

serv

ice

and

a g

roup

of r

elat

ed p

rodu

cts

or s

ervi

ces

subj

ect t

o ri

sks

and

retu

rns

diffe

rent

from

thos

e of

oth

er

busi

ness

seg

men

ts. I

t is

mea

sure

d ac

cord

ing

to th

e re

port

s us

ed b

y th

e G

ener

al M

anag

er o

r ot

her

key

deci

sion

mak

ers

at th

e B

ank.

A ge

ogra

phic

al s

egm

ent i

s a

dist

ingu

isha

ble

com

pone

nt o

f an

entit

y en

gage

d in

pro

vidi

ng p

rodu

cts

or s

ervi

ces

with

in a

par

ticul

ar e

cono

mic

env

iron

men

t sub

ject

to r

isks

and

ret

urns

diff

eren

t fro

m th

ose

of c

ompo

nent

s op

erat

ing

in o

ther

eco

nom

ic e

nvir

onm

ents

.

It is

the

finan

cial

ass

ets

held

by

the

Ban

k fo

r th

e pu

rpos

e of

trad

ing

in th

e ne

ar fu

ture

and

ach

ievi

ng g

ains

from

th

e flu

ctua

tions

in m

arke

t pri

ces

in th

e sh

ort t

erm

or

trad

ing

mar

gins

.

Fina

ncia

l ass

ets

at fa

ir v

alue

thro

ugh

profi

t or

loss

are

initi

ally

sta

ted

at fa

ir v

alue

at a

cqui

sitio

n da

te (p

urch

ase

cost

s ar

e re

cord

ed a

t the

con

solid

ated

sta

tem

ent o

f inc

ome

upon

acq

uisi

tion)

and

sub

sequ

ently

m

easu

red

at fa

ir v

alue

. Mor

eove

r, c

hang

es in

fair

val

ue a

re r

ecor

ded

in th

e co

nsol

idat

ed s

tate

men

t of i

ncom

e in

clud

ing

the

chan

ge in

fair

val

ue r

esul

ting

from

tran

slat

ion

of n

on-m

onet

ary

asse

ts s

tate

d at

fore

ign

curr

ency

. G

ains

or

loss

es r

esul

ting

from

the

sale

of t

hese

fina

ncia

l ass

ets

are

take

n to

the

cons

olid

ated

sta

tem

ent o

f inc

ome.

Div

iden

ds a

nd in

tere

sts

from

thes

e fin

anci

al a

sset

s ar

e re

cord

ed in

the

cons

olid

ated

sta

tem

ent o

f inc

ome.

It is

not

allo

wed

to r

ecla

ssify

any

fina

ncia

l ass

ets

to /

from

this

cat

egor

y ex

cept

for

the

case

s sp

ecifi

ed in

In

tern

atio

nal F

inan

cial

Rep

ortin

g St

anda

rds.

It is

not

allo

wed

to c

lass

ify a

ny fi

nanc

ial a

sset

s th

at d

o no

t hav

e pr

ices

in a

ctiv

e m

arke

ts a

nd a

ctiv

e d

ealin

gs in

this

item

.

Rep

rese

nts

finan

cial

ass

ets

whi

ch h

ave

fixed

or

agre

ed p

aym

ents

whi

ch th

e ba

nk s

ubm

itted

in th

e fir

st p

lace

an

d th

ese

finan

cial

ass

ets

do n

ot h

ave

quot

ed p

rice

s in

act

ive

mar

kets

.

Dir

ect c

redi

t fac

ilitie

s ar

e re

cord

ed a

t am

ortiz

ed c

ost a

fter

ded

uctin

g th

e pr

ovis

ion

for

the

dire

ct c

redi

t fac

ilitie

s a

nd in

tere

st a

nd c

omm

issi

ons

in s

uspe

nse.

A pr

ovis

ion

for

the

impa

irm

ent i

n di

rect

cre

dit f

acili

ties

is r

ecog

nize

d w

hen

it is

obv

ious

that

the

finan

cial

ass

ets

of th

e B

ank

cann

ot b

e re

cove

red,

ther

e is

an

obje

ctiv

e ev

iden

ce o

f the

exi

sten

ce o

f an

even

t neg

ativ

ely

affe

ctin

g th

e fu

ture

cas

h flo

ws

of th

e di

rect

cre

dit f

acili

ties,

and

the

impa

irm

ent a

mou

nt c

an b

e es

timat

ed.

The

prov

isio

n is

take

n to

the

cons

olid

ated

sta

tem

ent o

f inc

ome.

Inte

rest

and

com

mis

sion

s on

non

-per

form

ing

cred

it fa

cilit

ies

are

susp

ende

d in

acc

orda

nce

with

the

regu

latio

ns o

f the

Cen

tral

Ban

k of

Jor

dan.

Impa

ired

cre

dit f

acili

ties,

for

whi

ch s

peci

fic p

rovi

sion

s ha

ve b

een

take

n, a

re w

ritt

en o

ff by

cha

rgin

g th

e pr

ovis

ion

aft

er a

ll ef

fort

s ha

ve b

een

mad

e to

rec

over

the

asse

ts. A

ny s

urpl

us in

the

prov

isio

ns is

take

n to

the

cons

olid

ated

st

atem

ent o

f inc

ome,

whi

le d

ebt r

ecov

erie

s ar

e ta

ken

to in

com

e.

Thos

e fin

anci

al a

sset

s re

pres

ent t

he in

vest

men

ts in

equ

ity in

stru

men

ts h

eld

for

long

term

.

Fina

ncia

l ass

ets

at fa

ir v

alue

thro

ugh

othe

r co

mpr

ehen

sive

inco

me

are

initi

ally

sta

ted

at fa

ir v

alue

plu

s tr

ansa

ctio

n co

sts.

Sub

sequ

ently

, the

y ar

e m

easu

red

at fa

ir v

alue

with

gai

ns a

nd lo

sses

ari

sing

from

ch

ange

s in

fair

val

ue r

ecog

nize

d in

the

cons

olid

ated

sta

tem

ent o

f oth

er c

ompr

ehen

sive

inco

me

and

with

in o

wne

r's

equi

ty, i

nclu

ding

the

chan

ges

in fa

ir v

alue

res

ultin

g fr

om tr

ansl

atio

n of

non

-mon

etar

y as

sets

sta

ted

at fo

reig

n cu

rren

cy. G

ain

or lo

ss fr

om th

e sa

le o

f the

se in

vest

men

ts s

houl

d be

rec

ogni

zed

in th

e co

nsol

idat

ed s

tate

men

t of c

ompr

ehen

sive

inco

me

and

with

in o

wne

r's

equi

ty, a

nd th

e ba

lanc

e of

th

e ev

alua

tion

rese

rve

for

thes

e as

sets

sho

uld

be tr

ansf

erre

d di

rect

ly to

the

reta

ined

ear

ning

s no

t to

the

cons

olid

ated

sta

tem

ent o

f inc

ome.

No

impa

irm

ent t

estin

g is

req

uire

d fo

r th

ose

asse

ts.

Div

iden

ds a

re r

ecor

ded

in th

e co

nsol

idat

ed s

tate

men

t of i

ncom

e.

Fina

ncia

l ass

ets

at a

mor

tized

cos

t are

the

finan

cial

ass

ets

whi

ch th

e B

ank'

s m

anag

emen

t int

ends

acc

ordi

ng to

its b

usin

ess

mod

el to

hol

d fo

r th

e pu

rpos

e of

col

lect

ing

the

cont

ract

ual c

ash

flow

s w

hich

com

pris

e th

eco

ntra

ctua

l cas

h flo

ws

that

are

sol

ely

paym

ents

of p

rinc

ipal

and

inte

rest

on

the

prin

cipa

l out

stan

ding

Fina

ncia

l ass

ets

are

reco

rded

at c

ost u

pon

purc

hase

plu

s ac

quis

ition

exp

ense

s. M

oreo

ver,

the

issu

e pr

emiu

m \

disc

ount

is a

mor

tized

usi

ng th

e ef

fect

ive

inte

rest

rat

e m

etho

d, a

nd r

ecor

ded

to in

tere

st a

ccou

nt. P

rovi

sion

s as

soci

ated

with

the

decl

ine

in v

alue

of t

hese

inve

stm

ents

lead

ing

to th

e in

abili

ty to

rec

over

the

inve

stm

ent o

r pa

rts

ther

eof a

re d

educ

ted.

Any

impa

irm

ent i

s re

gist

ered

in th

e co

nsol

idat

ed s

tate

men

t of i

ncom

e an

d sh

ould

be

pre

sent

ed s

ubse

quen

tly a

t am

ortiz

ed c

ost l

ess

any

impa

irm

ent l

osse

s.

The

amou

nt o

f the

impa

irm

ent l

oss

reco

gniz

ed is

the

diffe

renc

e be

twee

n th

e as

set's

car

ryin

g am

ount

and

the

pres

ent v

alue

of e

stim

ated

futu

re c

ash

flow

s di

scou

nted

at t

he o

rigi

nal e

ffect

ive

inte

rest

rat

e

It is

not

allo

wed

to r

ecla

ssify

any

fina

ncia

l ass

ets

from

/ to

this

cat

egor

y ex

cept

for

cert

ain

case

s sp

ecifi

ed a

the

Inte

rnat

iona

l Fin

anci

al R

epor

ting

Stan

dard

s (a

nd in

the

case

of s

ellin

g th

ose

asse

ts b

efor

e its

mat

urity

da

te, t

he r

esul

ts s

houl

d be

rec

orde

d in

a s

epar

ate

acco

unt i

n th

e co

nsol

idat

ed s

tate

men

t of i

ncom

e,

disc

losu

res

shou

ld b

e m

ade

in a

ccor

danc

e to

the

requ

irem

ents

of I

nter

natio

nal F

inan

cial

Rep

ortin

g St

anda

rds)

.

Fair

val

ue r

epre

sent

s th

e cl

osin

g m

arke

t pri

ce (A

cqui

sitio

n of

ass

ets/

Sal

e of

liab

ilitie

s) o

f fina

ncia

l ass

ets

and

der

ivat

ives

on

the

date

of t

he c

onso

lidat

ed fi

nanc

ial s

tate

men

ts. I

n ca

se th

e de

clar

ed m

arke

t pri

ces

do

not e

xist

, act

ive

trad

ing

of s

ome

finan

cial

ass

ets

and

deri

vativ

es is

not

ava

ilabl

e, o

r th

e m

arke

t is

inac

tive,

fa

ir v

alue

is e

stim

ated

by

one

of s

ever

al m

etho

ds in

clud

ing

the

follo

win

g:

-Co

mpa

riso

n w

ith th

e fa

ir v

alue

of a

noth

er fi

nanc

ial a

sset

with

sim

ilar

term

s an

d co

nditi

ons.

-An

alys

is o

f the

est

imat

ed fu

ture

cas

h flo

ws

and

disc

ount

ed c

ash

flow

s at

cur

rent

rat

es a

pplic

able

for

item

sw

ith s

imila

r te

rms

and

risk

cha

ract

eris

tics.

Eval

uatio

n of

long

term

ass

ets

and

liabi

litie

s th

at b

ears

no

inte

rest

in a

ccor

danc

e to

dis

coun

ted

cash

flow

s us

ing

effe

ctiv

e in

tere

st r

ate,

pre

miu

ms

and

disc

ount

ed a

re a

mor

tized

with

in in

tere

st r

even

ue o

r ex

pens

e in

th

e co

nsol

idat

ed s

tate

men

t of i

ncom

e.

The

eval

uatio

n m

etho

ds a

im to

pro

vide

a fa

ir v

alue

refl

ectin

g th

e ex

pect

atio

ns o

f the

mar

ket,

and

take

into

co

nsid

erat

ion

mar

ket f

acto

rs, r

isks

and

exp

ecte

d be

nefit

s, a

t the

tim

e of

eva

luat

ion

of th

e fin

anci

al in

stru

men

ts.

In c

ase

the

fair

val

ue o

f an

inve

stm

ent c

anno

t be

mea

sure

d re

liabl

y, it

is s

tate

d at

cos

t les

s an

y im

pair

men

t

An

nual

Rep

ort

34th

An

nual

Rep

ort

34th

Inte

rest

inco

me

is r

ealiz

ed a

nd e

xpen

ses

are

reco

gniz

ed u

sing

the

effe

ctiv

e in

tere

st r

ate

met

hod,

exc

ept f

or

inte

rest

and

com

mis

sion

on

non-

perf

orm

ing

loan

s w

hich

are

not

rec

ogni

zed

as r

even

ue b

ut r

ecor

ded

in th

e in

tere

st a

nd c

omm

issi

on in

sus

pens

e ac

coun

t unt

il th

ey a

re r

ecei

ved

in c

ash.

Expe

nses

are

rec

ogni

zed

on th

e ac

crua

l bas

is.

Com

mis

sion

is r

ecor

ded

as r

even

ue w

hen

the

rela

ted

serv

ices

are

pro

vide

d.

Div

iden

ds a

re r

ecor

ded

whe

n re

aliz

ed (d

ecid

ed u

pon

by th

e G

ener

al A

ssem

bly

of S

hare

hold

ers)

.

Fina

ncia

l ass

ets

are

reco

gniz

ed o

n th

e tr

adin

g da

te w

hich

is th

e da

te th

e B

ank

com

mits

its

elf t

o pu

rcha

se o

r se

ll th

e fin

anci

al a

sset

s

For

hedg

e ac

coun

ting

purp

oses

, fina

ncia

l der

ivat

ives

are

sta

ted

at fa

ir v

alue

. H

edge

s ar

e cl

assi

fied

as fo

llow

s:

-Fa

ir v

alue

hed

ge:

Hed

ge fo

r th

e ch

ange

in th

e fa

ir v

alue

exp

osur

es o

f the

Ban

k's

asse

ts a

nd li

abili

ties.

Whe

n th

e co

nditi

ons

of e

ffect

ive

fair

val

ue h

edge

are

met

, the

res

ultin

g ga

in o

r lo

ss fr

om r

e-m

easu

ring

the

fair

val

ue h

edge

is r

ecog

nize

d in

the

cons

olid

ated

sta

tem

ent o

f inc

ome.

Whe

n th

e co

nditi

ons

of e

ffect

ive

port

folio

hed

ge a

re m

et, t

he g

ain

or lo

ss r

esul

ting

from

the

reva

luat

ion

of

the

hedg

ing

inst

rum

ent a

t fai

r va

lue

as w

ell a

s th

e ch

ange

in th

e fa

ir v

alue

of t

he a

sset

s or

liab

ilitie

s po

rtfo

lio

are

reco

rded

in th

e co

nsol

idat

ed s

tate

men

t of i

ncom

e fo

r th

e sa

me

peri

od.

-Ca

sh fl

ow h

edge

:H

edge

for

the

chan

ge in

the

curr

ent a

nd e

xpec

ted

cash

flow

s ex

posu

res

of th

e B

ank'

s as

sets

and

liab

ilitie

s

Whe

n th

e co

nditi

ons

of e

ffect

ive

cash

flow

hed

ge a

re m

et, t

he g

ain

or lo

ss o

f the

hed

ging

inst

rum

ents

isre

cogn

ized

in th

e co

nsol

idat

ed s

tate

men

t of o

ther

com

preh

ensi

ve in

com

e in

ow

ners

' equ

ity. S

uch

gain

or

loss

is

tran

sfer

red

to th

e co

nsol

idat

ed s

tate

men

t of i

ncom

e in

the

peri

od in

whi

ch th

e he

dge

tran

sact

ion

impa

cts

the

cons

olid

ated

sta

tem

ent o

f inc

ome

-H

edge

for

net i

nves

tmen

t in

fore

ign

entit

ies:

Whe

n th

e co

nditi

ons

of th

e he

dge

for

net i

nves

tmen

t in

fore

ign

entit

ies

are

met

, fai

r va

lue

is m

easu

red

for

the

hedg

ing

inst

rum

ent o

f the

hed

ged

net a

sset

s. In

cas

e of

an

effe

ctiv

e re

latio

nshi

p, th

e ef

fect

ive

port

ion

of th

e lo

ss o

r pr

ofit r

elat

ed to

the

hedg

ing

inst

rum

ent i

s re

cogn

ized

in th

e co

nsol

idat

ed s

tate

men

t of o

ther

com

preh

ensi

ve in

com

e an

d in

ow

ner'

s eq

uity

. The

inef

fect

ive

port

ion

is r

ecog

nize

d in

the

cons

olid

ated

st

atem

ent o

f inc

ome.

The

effe

ctiv

e po

rtio

n is

rec

orde

d in

the

cons

olid

ated

sta

tem

ent o

f inc

ome

whe

n th

e in

vest

men

t in

fore

ign

entit

ies

is s

old.

Whe

n th

e co

nditi

ons

of th

e ef

fect

ive

hedg

e do

not

app

ly, g

ain

or lo

ss r

esul

ting

from

the

chan

ge in

the

fair

val

ue

of th

e he

dgin

g in

stru

men

t is

reco

rded

in th

e co

nsol

idat

ed s

tate

men

t of i

ncom

e in

the

sam

e pe

riod

.

The

fair

val

ue o

f fina

ncia

l der

ivat

ives

for

trad

ing

such

as

forw

ard

fore

ign

curr

ency

con

trac

ts, f

utur

e in

tere

st r

ate

cont

ract

s, s

wap

agr

eem

ents

, and

fore

ign

curr

ency

opt

ions

is r

ecor

ded

in th

e co

nsol

idat

ed s

tate

men

t of fi

nanc

ial

posi

tion

unde

r ot

her

asse

ts o

r ot

her

liabi

litie

s as

the

case

may

be.

Fai

r va

lue

is m

easu

red

acco

rdin

g to

the

prev

ailin

g m

arke

t pri

ces,

and

if th

ey a

re n

ot a

vaila

ble,

the

mea

sure

men

t met

hod

shou

ld b

e di

sclo

sed.

The

ch

ange

in th

eir

fair

val

ue is

rec

ogni

zed

in th

e co

nsol

idat

ed s

tate

men

t of i

ncom

e.

Asse

ts s

old

with

a s

imul

tane

ous

com

mitm

ent t

o re

purc

hase

them

at a

futu

re d

ate

cont

inue

to b

e re

cogn

ized

in

the

cons

olid

ated

fina

ncia

l sta

tem

ents

as

a re

sult

of th

e B

ank'

s co

ntin

uous

con

trol

ove

r th

ese

asse

ts a

nd a

s th

ere

late

d ri

sks

and

bene

fits

are

tran

sfer

red

to th

e B

ank

upon

occ

urre

nce.

The

y al

so c

ontin

ue to

be

mea

sure

d in

acco

rdan

ce w

ith th

e ad

opte

d ac

coun

ting

polic

ies.

Am

ount

s re

ceiv

ed a

gain

st th

ese

cont

ract

s ar

e re

cord

ed w

ithin

lia

bilit

ies

unde

r bo

rrow

ed fu

nds.

The

diff

eren

ce b

etw

een

the

sale

pri

ce a

nd th

e re

purc

hase

pri

ce is

rec

ogni

zed

as a

n in

tere

st e

xpen

se a

mor

tized

ove

r th

e co

ntra

ct p

erio

d us

ing

the

effe

ctiv

e in

tere

st r

ate

met

hod.

Purc

hase

d as

sets

with

cor

resp

ondi

ng c

omm

itmen

t to

sell

at a

spe

cific

futu

re d

ate

are

not r

ecog

nize

d in

the

cons

olid

ated

fina

ncia

l sta

tem

ents

bec

ause

the

Ban

k ha

s no

con

trol

ove

r su

ch a

sset

s an

d th

e re

late

d ri

sks

and

bene

fits

are

not t

rans

ferr

ed to

the

Ban

k up

on o

ccur

renc

e. P

aym

ents

rel

ated

to th

ese

cont

ract

s ar

e re

cord

edun

der

depo

sits

with

ban

ks a

nd o

ther

fina

ncia

l ins

titut

ions

or

loan

s an

d ad

vanc

es in

acc

orda

nce

with

the

natu

reof

eac

h ca

se. T

he d

iffer

ence

bet

wee

n th

e pu

rcha

se p

rice

and

res

ale

pric

e is

rec

orde

d as

inte

rest

rev

enue

am

ortiz

ed o

ver

the

life

of th

e co

ntra

ct u

sing

the

effe

ctiv

e in

tere

st r

ate

met

hod.

Asse

ts s

eize

d by

the

Ban

k ar

e sh

own

unde

r "o

ther

ass

ets"

at t

he a

cqui

sitio

n va

lue

or fa

ir v

alue

, whi

chev

er is

lo

wer

. As

of th

e co

nsol

idat

ed fi

nanc

ial s

tate

men

ts d

ate,

thes

e as

sets

are

rev

alue

d in

divi

dual

ly a

t fai

r va

lue.

Any

decl

ine

in th

eir

mar

ket v

alue

is ta

ken

to th

e co

nsol

idat

ed s

tate

men

t of i

ncom

e w

here

as a

ny s

uch

incr

ease

is n

ot

reco

gniz

ed. A

sub

sequ

ent i

ncre

ase

is ta

ken

to th

e co

nsol

idat

ed s

tate

men

t of i

ncom

e to

the

exte

nt it

doe

s no

t ex

ceed

the

prev

ious

ly r

ecor

ded

impa

irm

ent.

Prov

isio

n is

pro

vide

d ag

ains

t siz

ed a

sset

s fo

r m

ore

than

four

yea

rs a

ccor

ding

to c

entr

al b

ank

of J

orda

n re

gula

tion

A.Go

odw

illTh

e go

odw

ill r

epre

sent

the

posi

tive

diffe

renc

e be

twee

n th

e co

st o

f acq

uisi

tion

or p

urch

ase

pric

e of

the

asso

ciat

eor

sub

sidi

ary

and

the

com

pany

’s n

et a

sset

fair

val

ue a

t the

dat

e of

acq

uisi

tion.

The

good

will

res

ultin

g fr

om in

vest

men

t in

subs

idia

ry is

dis

clos

ed in

a s

epar

ate

note

as

inta

ngib

le a

sset

,as

for

good

will

res

ultin

g fr

om in

vest

men

t in

asso

ciat

e it’

s di

sclo

sed

as p

art o

f inv

estm

ent a

ccou

nt a

nd it

get

sim

pair

ed o

ver

the

peri

od, w

hen

its v

alue

goe

s do

wn.

Impa

irm

ent t

est f

or g

oodw

ill is

per

form

ed a

t the

dat

e of

eac

h fin

anci

al s

tate

men

t, w

hich

is th

e re

sult

ofa

decr

ease

in c

ash

flow

gen

erat

ed b

y go

odw

ill r

ecov

erab

le v

alue

at t

he d

ate

of th

e fin

anci

al c

ompa

red

toth

e co

st o

f goo

dwill

rec

orde

d in

the

book

s, in

suc

h ca

ses

the

good

will

impa

irm

ent a

mou

nt is

dis

clos

ed in

the

Inco

me

stat

emen

t.

An

nual

Rep

ort

34th

B.O

ther

inta

ngib

le a

sset

sIn

tang

ible

ass

ets

purc

hase

d in

an

acqu

isiti

on a

re s

tate

d at

fair

val

ue a

t the

dat

e of

acq

uisi

tion.

Inta

ngib

le a

sset

spu

rcha

sed

othe

r th

an th

roug

h ac

quis

ition

are

rec

orde

d at

cos

t.

Inta

ngib

le a

sset

s ar

e to

be

clas

sifie

d on

the

basi

s of

eith

er d

efini

te o

r in

defin

ite u

sefu

l life

. Int

angi

ble

asse

ts w

ith

defin

ite u

sefu

l eco

nom

ic li

ves

are

amor

tized

ove

r th

eir

usef

ul li

ves

and

reco

rded

as

an e

xpen

se in

the

cons

olid

ated

sta

tem

ent o

f inc

ome.

Inta

ngib

le a

sset

s w

ith in

defin

ite li

ves

are

revi

ewed

for

impa

irm

ent a

s of

the

cons

olid

ated

fina

ncia

l s

tate

men

ts d

ate,

and

impa

irm

ent l

oss

is tr

eate

d in

the

cons

olid

ated

sta

tem

ent o

f inc

ome

as a

n ex

pens

e fo

r th

e pe

riod

.

No

capi

taliz

atio

n of

inte

rnal

ly g

ener

ated

inta

ngib

le a

sset

s re

sulti

ng fr

om th

e B

ank'

s op

erat

ions

is m

ade.

Th

ey a

re r

athe

r re

cord

ed a

s an

exp

ense

in th

e co

nsol

idat

ed s

tate

men

t of i

ncom

e fo

r th

e pe

riod

.

Any

indi

catio

ns o

f im

pair

men

t in

the

valu

e of

inta

ngib

le a

sset

s as

of t

he c

onso

lidat

ed fi

nanc

ial s

tate

men

ts d

ate

are

revi

ewed

. Fur

ther

mor

e, th

e es

timat

ed u

sefu

l liv

es o

f the

impa

ired

inta

ngib

le a

sset

s ar

e re

asse

ssed

, a

nd a

ny a

djus

tmen

t is

mad

e in

the

subs

eque

nt p

erio

d.

Soft

war

e an

d co

mpu

ter

prog

ram

s ar

e am

ortiz

ed o

ver

thei

r es

timat

ed u

sefu

l eco

nom

ic li

ves

at a

rat

e of

%20

ann

ually

.

Tran

sact

ions

in fo

reig

n cu

rren

cies

dur

ing

the

year

are

rec

orde

d at

the

exch

ange

rat

es p

reva

iling

at t

he d

ate

of th

e tr

ansa

ctio

n.

Fina

ncia

l ass

ets

and

finan

cial

liab

ilitie

s de

nom

inat

ed in

fore

ign

curr

enci

es a

re tr

ansl

ated

at t

he a

vera

ge

rate

s pr

evai

ling

on th

e co

nsol

idat

ed s

tate

men

t of fi

nanc

ial p

ositi

on d

ate

and

decl

ared

by

the

Cent

ral B

ank

of J

orda

n.

Non

-mon

etar

y as

sets

and

liab

ilitie

s de

nom

inat

ed in

fore

ign

curr

enci

es a

nd r

ecor

ded

at fa

ir v

alue

are

tran

slat

ed o

n th

e da

te w

hen

thei

r fa

ir v

alue

is d

eter

min

ed.

Gai

ns o

r lo

sses

res

ultin

g fr

om fo

reig

n cu

rren

cy tr

ansl

atio

n ar

e re

cord

ed in

the

cons

olid

ated

sta

tem

ent o

f inc

ome.

Tran

slat

ion

diffe

renc

es o

n no

n-m

onet

ary

asse

ts a

nd li

abili

ties

deno

min

ated

in fo

reig

n cu

rren

cies

are

rec

orde

d as

par

t of t

he c

hang

e in

fair

val

ue.

Cash

and

cas

h eq

uiva

lent

s co

mpr

ise

cash

bal

ance

s w

ith th

e Ce

ntra

l Ban

k of

Jor

dan

and

bala

nces

with

ban

ks a

ndfin

anci

al in

stitu

tions

mat

urin

g w

ithin

thre

e m

onth

s fr

om p

urch

ase

date

, les

s ba

lanc

es d

ue to

ban

ks a

nd fi

nanc

ial

inst

itutio

ns m

atur

ing

with

in th

ree

mon

ths

and

rest

rict

ed fu

nds.

Prep

arat

ion

of th

e co

nsol

idat

ed fi

nanc

ial s

tate

men

ts a

nd th

e ap

plic

atio

n of

the

acco

untin

g po

licie

s re

quir

e th

eB

ank'

s m

anag

emen

t to

perf

orm

ass

essm

ents

and

ass

umpt

ions

that

affe

ct th

e am

ount

s of

fina

ncia

l ass

ets

and

liabi

litie

s, fa

ir v

alue

res

erve

and

the

disc

losu

re o

f con

tinge

nt li

abili

ties.

Mor

eove

r, th

ese

asse

ssm

ents

and

as

sum

ptio

ns a

ffect

rev

enue

s, e

xpen

ses,

pro

visi

ons,

and

cha

nges

in th

e fa

ir v

alue

sho

wn

with

in th

e co

nsol

idat

ed s

tate

men

t of o

ther

com

preh

ensi

ve in

com

e. In

par

ticul

ar, t

his

requ

ires

the

Ban

k's

man

agem

ent t

o is

sue

sign

ifica

nt ju

dgm

ents

and

ass

umpt

ions

to a

sses

s fu

ture

cas

h flo

w a

mou

nts

and

thei

r tim

ing.

Mor

eove

rth

e sa

id a

sses

smen

ts a

re n

eces

sari

ly b

ased

on

assu

mpt

ions

and

fact

ors

with

var

ying

deg

rees

of c

onsi

dera

tion

and

unce

rtai

nty.

In a

dditi

on, a

ctua

l res

ults

may

diff

er fr

om a

sses

smen

ts d

ue to

the

chan

ges

resu

lting

from

the

cond

ition

s an

d ci

rcum

stan

ces

of th

ose

asse

ssm

ents

in th

e fu

ture

.

A pr

ovis

ion

is s

et a

gain

st th

e la

wsu

its r

aise

d ag

ains

t the

Ban

k. T

his

prov

isio

n is

sub

ject

to a

n ad

equa

te le

gal

stud

y pr

epar

ed b

y th

e B

ank'

s le

gal a

dvis

ors.

Mor

eove

r, th

e st

udy

high

light

s po

tent

ial r

isks

that

the

Ban

k m

ay

enco

unte

r in

the

futu

re. S

uch

lega

l ass

essm

ents

are

rev

iew

ed p

erio

dica

lly.

A pr

ovis

ion

for

perf

orm

ing

and

non-

perf

orm

ing

loan

s is

take

n on

the

base

s an

d es

timat

es a

ppro

ved

by th

e B

ank'

s m

anag

emen

t in

conf

orm

ity w

ith In

tern

atio

nal F

inan

cial

Rep

ortin

g St

anda

rds

(IFR

S). T

he o

utco

me

of

thes

e ba

ses

and

estim

ates

is c

ompa

red

agai

nst t

he a

dequ

acy

of th

e pr

ovis

ions

as

per

the

Cent

ral B

ank

of

Jord

an's

inst

ruct

ions

. The

str

icte

st o

utco

me

that

con

form

s to

Inte

rnat

iona

l Fin

anci

al R

epor

ting

Stan

dard

s is

us

ed fo

r de

term

inin

g th

e pr

ovis

ion.

Impa

irm

ent l

oss

is b

ooke

d af

ter

a su

ffici

ent a

nd r

ecen

t eva

luat

ion

of th

e as

sets

sei

zed

by th

e B

ank

has

been

cond

ucte

d by

app

rove

d su

rvey

ors.

The

impa

irm

ent l

oss

is r

evie

wed

per

iodi

cally

.

Man

agem

ent p

erio

dica

lly r

eass

esse

s th

e ec

onom

ic u

sefu

l liv

es o

f tan

gibl

e an

d in

tang

ible

ass

ets

for

the

purp

ose

of c

alcu

latin

g an

nual

dep

reci

atio

n an

d am

ortiz

atio

n ba

sed

on th

e ge

nera

l con

ditio

n of

thes

e as

sets

an

d th

e as

sess

men

t of t

heir

use

ful e

cono

mic

live

s ex

pect

ed in

the

futu

re. I

mpa

irm

ent l

oss

(if a

ny) i

s ta

ken

to

the

cons

olid

ated

sta

tem

ent o

f inc

ome.

Man

agem

ent f

requ

ently

rev

iew

s th

e fin

anci

al a

sset

s st

ated

at c

ost t

o es

timat

e an

y de

clin

e in

thei

r va

lue.

Impa

irm

ent l

oss

(if a

ny) i

s ta

ken

to th

e co

nsol

idat

ed s

tate

men

t of i

ncom

e as

an

expe

nse

for

the

year

.

Man

agem

ent e

stim

ates

the

impa

irm

ent i

n fa

ir v

alue

whe

n th

e m

arke

t val

ue r

each

es a

cer

tain

lim

it in

dica

tive

of

the

amou

nt o

f im

pair

men

t los

s, w

hich

doe

sn't

confl

ict w

ith th

e In

tern

atio

nal F

inan

cial

Rep

ortin

g St

anda

rds

and

the

inst

ruct

ions

of t

he R

egul

ator

y au

thor

ities

.

Fair

Val

ue H

iera

rchy

:

The

Ban

k de

term

ines

and

dis

clos

es th

e le

vel i

n th

e fa

ir v

alue

hie

rarc

hy in

to w

hich

the

fair

val

ue m

easu

rem

ents

ar

e ca

tego

rize

d in

thei

r en

tiret

y, s

egre

gatin

g fa

ir v

alue

mea

sure

men

ts in

acc

orda

nce

with

the

leve

ls d

efine

d in

IFR

S. D

iffer

entia

ting

betw

een

Leve

l 2 a

nd L

evel

3 fa

ir v

alue

mea

sure

men

ts, i

.e.,

asse

ssin

g w

heth

er in

puts

are

ob

serv

able

and

whe

ther

the

unob

serv

able

inpu

ts a

re s

igni

fican

t, m

ay r

equi

re ju

dgm

ent a

nd a

car

eful

ana

lysi

sof

the

inpu

ts u

sed

to m

easu

re fa

ir v

alue

, inc

ludi

ng c

onsi

dera

tion

of fa

ctor

s sp

ecifi

c to

the

asse

t or

liabi

lity

The

man

agem

ent b

elie

ves

that

the

estim

ates

ado

pted

in th

e pr

epar

atio

n of

the

cons

olid

ated

fina

ncia

lst

atem

ents

are

rea

sona

ble.

This

item

con

sist

s of

the

follo

win

g:

Cash

on

hand

Bal

ance

s w

ith c

entr

al b

anks

Curr

ent a

nd d

eman

d ac

coun

tsTe

rm a

nd n

otic

e de

posi

ts

Stat

utor

y ca

sh r

eser

ve *

10,7

54,1

30

6,15

2,44

9 -

43,6

43,4

38

91,2

50,0

17

-Ex

cept

for

the

stat

utor

y ca

sh r

eser

ve, t

here

are

no

rest

rict

ed b

alan

ces

as o

f 31D

ecem

ber

2016

and

201

5.-

Ther

e ar

e no

bal

ance

s m

atur

ed in

a p

erio

d ex

ceed

ing

thre

e m

onth

s as

of 3

1 D

ecem

ber

2016

and

201

5.

Dep

osit

cert

ifica

te30

,700

,000

8,94

5,79

8

728,

924

22,0

00,0

00

39,5

53,0

69

102,

527,

791

31,3

00,0

00

An

nual

Rep

ort

34th

JDJD

JDJD

JDJD

JDJD

JDJD

JDJD

This

item

con

sist

s of

the

follo

win

g:

Loca

l Ban

ks a

nd F

inan

cial

Inst

itutio

nsFo

reig

n B

anks

and

Fi

nanc

ial I

nstit

utio

nsTo

tal

Tota

l

31 D

ecem

ber

31 D

ecem

ber

31 D

ecem

ber

31 D

ecem

ber

31 D

ecem

ber

31 D

ecem

ber

2016

2015

2016

JD

31 D

ecem

ber

2016

JD

31 D

ecem

ber

2015

2015

2016

2015

Curr

ent a

nd d

eman

d ac

coun

ts

Dep

osit

mat

urin

g w

ithin

th

ree

mon

ths

Tota

l

-N

on-i

nter

est b

eari

ng b

alan

ces

at b

anks

and

fina

ncia

l ins

titut

ions

am

ount

ed to

JD

29,

012,

436

as o

f31

Dec

embe

r 20

16 a

gain

st J

D 2

0,46

4,39

1 as

of 3

1 D

ecem

ber

2015

.

-Th

ere

is n

o re

stri

cted

bal

ance

s as

of 3

1 D

ecem

ber

2016

aga

inst

JD

2,3

83,2

68 a

s of

31

Dec

embe

r 20

15.

Loca

l Ban

ks a

nd

Fina

ncia

l Ins

titut

ions

Fore

ign

Ban

ks a

nd

Fina

ncia

l Ins

titut

ions

Dep

osits

5,50

0,00

0

Ther

e ar

e no

res

tric

ted

depo

sits

as

of 3

1 D

ecem

ber

2016

and

201

5.

Dep

osits

bal

ance

s m

atur

ing

with

in a

per

iod

exce

edin

g th

ree

mon

ths

amou

nted

to

JD 5

,500

,000

as

of 3

1 D

ecem

ber

2016

aga

inst

JD

5,0

00,0

00 a

s of

31

Dec

embe

r 20

15.

This

item

con

sist

s of

the

follo

win

g:

Com

pani

es s

hare

sIn

vest

men

t fun

ds

2,08

9,00

0

39,1

16

2,12

8,11

6

2,51

7,28

1

39,1

16

2,55

6,39

7

This

item

con

sist

s of

the

follo

win

g:

This

item

con

sist

s of

the

follo

win

g:

Quo

ted

shar

es

Unq

uote

d sh

ares

*

*Th

e fa

ir v

alue

of t

he u

nquo

ted

shar

es h

as b

een

valu

ed u

sing

the

net b

ook

valu

e m

etho

d w

hich

is c

onsi

dere

dth

e be

st v

alua

tion

met

hod

for

such

inve

stm

ents

.

Rea

lized

loss

es o

n th

e sa

le o

f sha

res

at fa

ir v

alue

thro

ugh

othe

r co

mpr

ehen

sive

inco

me

amou

nted

to J

D 6

72,0

71 fo

r th

e ye

ar e

nded

31

Dec

embe

r 20

16 a

gain

st J

D 3

4,04

7 fo

r th

e ye

ar e

nded

31

Dec

embe

r 20

15,

whi

ch w

as d

irec

tly

reco

rded

to r

etai

ned

earn

ings

in o

wne

r's

equi

ty.

Cas

h di

vide

nds

on fi

nanc

ial a

sset

s am

ount

ed to

JD

1,5

54,5

92 fo

r th

e ye

ar e

nded

31

Dec

embe

r 20

16

agai

nst J

D 9

62,4

35 fo

r th

e ye

ar e

nded

31

Dec

embe

r 20

15.

Quo

ted

finan

cial

ass

ets:

Gov

ernm

enta

l bon

ds *

Gov

ernm

enta

l bon

ds g

uara

ntee

d by

the

gove

rnm

ent

Unq

uote

d fin

anci

al a

sset

s:

Com

pani

es b

onds

and

deb

entu

res

Tota

l fina

ncia

l ass

ets

at a

mor

tized

cos

t

Bon

ds a

nd b

ills

anal

ysis

:

Fixe

d re

turn

Floa

ting

rate

Anal

ysis

bon

ds a

nd tr

easu

ry b

ills

-6,

359,

996

83,1

29,7

6782

,075

,105

88,4

07,9

7510

7,72

7,47

9

14,7

93,7

8411

,352

,475

Gov

ernm

enta

l bon

ds16

,942

,111

-

31,7

35,8

95

Tota

l5,

500,

000

5,00

0,00

0

5,00

0,00

0

5,50

0,00

0

5,50

0,00

0

5,00

0,00

0

5,00

0,00

0

Tota

l

Tota

l

Corp

orat

e lo

ans

(Com

pani

es b

onds

and

deb

entu

res)

5,27

8,20

819

,292

,378

Tota

l

11,3

52,4

75

120,

143,

870

119,

079,

954

98,1

19,9

5411

2,05

4,94

4

22,0

23,9

167,

025,

010

Tota

l

An

nual

Rep

ort

34th

This

item

con

sist

s of

the

follo

win

g:

Indi

vidu

als

(ret

ail)

:

Ove

rdra

ft

Loan

s an

d di

scou

nted

bill

s *

Cred

it Ca

rds

Rea

l est

ate

loan

s

Com

pani

es

Corp

orat

e:

Ove

rdra

ft

Loan

s an

d di

scou

nted

bill

s *

Med

ium

and

sm

all e

ntiti

es

Gove

rnm

ent a

nd p

ublic

sec

tor

Ove

rdra

ft

Loan

s an

d di

scou

nted

bill

s *

Tota

l

Less

: Pro

visi

on fo

r im

pair

men

t in

dire

ct c

redi

t fac

ilitie

s

Inte

rest

in s

uspe

nse

Net

Dir

ect C

redi

t Fac

ilitie

s

7,87

8,53

3

15,9

08,8

06

12,4

39,7

77

94,8

08,1

91

124,

713,

597

79,8

83,1

62

220,

305,

556

12,3

15,3

95

24,2

03-

568,

277,

220

23,3

14,6

96

6,33

2,23

9

538,

630,

285

7,65

8,98

5

10,1

14,2

94

13,2

15,4

33

48,7

18,6

50

117,

991,

221

72,7

11,5

44

206,

238,

290

8,41

5,25

4

485,

063,

671

19,2

77,8

46

11,0

81,5

57

454,

704,

268

The

mov

emen

t on

the

prov

isio

n fo

r im

pair

men

t in

dire

ct c

redi

t fac

ilitie

s w

as a

s fo

llow

s:

Bal

ance

at 1

Jan

uary

Bal

ance

at 1

Jan

uary

Prov

isio

n (s

urpl

us)

Bal

ance

s ge

nera

ted

from

inve

stm

ent i

n su

bsid

iari

es

Char

ge fo

r th

e ye

ar

Use

d du

ring

the

year

(w

ritt

en-o

ff)*

Prov

isio

n (s

urpl

us)

Char

ge fo

r th

e ye

ar

Use

d du

ring

the

year

(w

ritt

en-o

ff)*

Bal

ance

at y

ear

end

Bal

ance

at y

ear

end

4,41

6,99

31,

220,

209

9,86

7,53

53,

773,

109

19,2

77,8

46

4,52

9,39

247

7,00

513

5,25

85,

141,

655

146,

580

(678

,137

)21

3,66

0(5

76,1

48)

(894

,045

)

(199

,601

) -

-

(11,

159)

(210

,760

)

8,89

3,36

41,

019,

077

10,0

81,1

953,

321,

060

23,3

14,6

96

4,97

2,95

36,

775,

559

12,0

16,6

425,

449,

261

29,2

14,4

15

487,

461

(5,5

37,6

18)

1,63

9,24

310

7,40

8(3

,303

,506

)

1,04

3,42

1)17

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788,

350)

(1,7

83,5

60)

(6,6

33,0

63)

4,41

6,99

31,

220,

209

9,86

7,53

53,

773,

109

19,2

77,8

46

*Net

aft

er d

educ

ting

inte

rest

and

com

mis

sion

s re

ceiv

ed in

adv

ance

of J

D 1

8,90

8,60

9 as

of

31 D

ecem

ber

2016

aga

inst

JD

6,8

13,2

31 a

s of

31

Dec

embe

r 20

15.

Non

-per

form

ing

cred

it fa

cilit

ies

amou

nted

to J

D 3

8,50

9,59

2 w

hich

is e

quiv

alen

t to

%6.

8 of

tota

l dir

ect

cred

it fa

cilit

ies

as o

f 31

Dec

embe

r 20

16 a

gain

st J

D 3

4,24

0,98

2, w

hich

is e

quiv

alen

t to

%7.

1 of

tota

l cre

dit

faci

litie

s as

of 3

1 D

ecem

ber

2015

.

Non

- pe

rfor

min

g cr

edit

faci

litie

s ex

clud

ing

inte

rest

and

com

mis

sion

s in

sus

pens

e am

ount

ed to

JD

32

,183

,664

whi

ch is

equ

ival

ent t

o %

5.7

of to

tal d

irec

t cre

dit f

acili

ties

afte

r ex

clud

ing

inte

rest

in s

uspe

nse

as o

f 31

Dec

embe

r 20

16 a

gain

st J

D 2

3,56

5,93

3 w

hich

is e

quiv

alen

t to

%4.

97 o

f tot

al c

redi

t fac

ilitie

s af

ter

excl

udin

g in

tere

st in

sus

pens

e as

of 3

1 D

ecem

ber

2015

.

Dir

ect c

redi

t fac

ilitie

s gr

ante

d to

/ gu

aran

teed

by

Jord

an G

over

nmen

t as

of 3

1 D

ecem

ber

2016

JD

24,

203

agai

nst J

D Z

ero

as o

f 31

Dec

embe

r 20

15.

Part

of t

he c

olla

tera

ls o

f the

due

inst

alm

ents

and

fina

nce

leas

e co

ntra

ct r

elat

ed to

Jor

dan

Tard

e Fa

cilit

ies

Com

pany

with

an

amou

nt o

f JD

16,

937,

500

(Che

ques

and

pro

mis

sory

not

es) a

s of

31

Dec

embe

r 20

16 w

ere

depo

site

d as

col

late

rals

aga

inst

the

loan

s an

d ov

erdr

aft o

f the

com

pany

.

Non

-per

form

ing

cred

it fa

cilit

ies

prov

isio

n am

ount

ed to

JD

23,

052,

493

as o

f 31

Dec

embe

r 20

16 a

gain

st J

D

18,3

79,2

94 a

s of

31

Dec

embe

r 20

15 in

add

ition

the

wat

ch li

st p

rovi

sion

am

ount

ed to

JD

262

,203

as

of 3

1 D

ecem

ber

2016

aga

inst

JD

898

,552

as

of 3

1 D

ecem

ber

2015

.

The

prov

isio

ns n

o lo

nger

nee

ded

due

to s

ettle

men

ts o

r re

paym

ents

of d

ebts

and

tran

sfer

red

agai

nst o

ther

de

bts

amou

nted

to J

D 8

,043

,963

as

of 3

1 D

ecem

ber

2016

aga

inst

JD

9,5

14,1

19 a

s of

31

Dec

embe

r 20

15.

The

prov

isio

n fo

r im

pair

ed c

redi

t fac

ilitie

s re

pres

entin

g w

atch

list

and

non

-per

form

ing

cred

it fa

cilit

ies

are

calc

ulat

ed b

ased

on

the

indi

vidu

al c

usto

mer

and

not

the

port

folio

exc

ept f

or th

e am

ount

880

,327

JD

has

be

en c

alcu

late

d on

the

base

s of

the

port

folio

An

nual

Rep

ort

34th

-

Bal

ance

at 1

Jan

uary

Inte

rest

in s

uspe

nse

for

the

year

Inte

rest

tran

sfer

red

to r

even

ue

Inte

rest

in s

uspe

nse

wri

tten

-off

*

Bal

ance

at y

ear

end

Bal

ance

at 1

Jan

uary

Inte

rest

in s

uspe

nse

for

the

year

Inte

rest

rev

erse

d to

inco

me

Inte

rest

in s

uspe

nse

wri

tten

-off

*

Bal

ance

at y

ear

end

-N

et c

redi

t fac

ilitie

s ar

e di

stri

bute

d ac

cord

ing

to e

cono

mic

sec

tor

taki

ng in

to c

onsi

dera

tion

that

all

loan

sgr

ante

d in

side

Jor

dan

as fo

low

s:

Tota

l

49,8

61,0

15

2,00

0,22

61,

661,

116

6,18

1,86

21,

238,

353

11,0

81,5

57

1,55

1,70

6

(5,1

56,0

42)

(1,1

44,9

82)

6,33

2,23

9

12,2

88,9

06

3,46

6,92

8

(1,8

13,1

96)

(2,8

61,0

81)

11,0

81,5

57

394,

319

92,2

8976

7,18

729

7,91

1

(31,

313)

(925

,392

)(3

,827

,503

)(3

71,8

34)

(652

,797

)(2

01,5

79)

(286

,658

)(3

,948

)

1,71

0,43

562

6,43

42,

834,

888

1,16

0,48

2

1,75

2,82

23,

040,

787

6,04

5,74

61,

449,

551

484,

627

257,

817

2,36

8,68

235

5,80

2

(25,

562)

(1,5

97,5

60)

(170

,061

)(2

0,01

3)

(211

,661

)(3

9,92

8)(2

,062

,505

)(5

46,9

87)

2,00

0,22

61,

661,

116

6,18

1,86

21,

238,

353

73,4

56,0

37

126,

729,

392

43,3

84,7

57

32,3

75,0

34

1,35

5,41

5

64,8

68,1

88

16,0

24,1

10

24,2

03-

568,

277,

220

38,5

21,1

69

71,5

49,8

50

116,

701,

788

26,5

76,6

52

43,3

19,8

41

1,21

9,31

3

60,6

40,3

19

20,6

94,1

65

105,

840,

574

160,

199,

069

485,

063,

671

This

item

con

sist

s of

the

follo

win

g:

Cost

Addi

tions

Dis

posa

ls

Dis

posa

ls

Addi

tions

Tran

sfer

s

Bal

ance

at 3

1 D

ecem

ber

Bal

ance

at 3

1 D

ecem

ber

Net

boo

k va

lue

of fi

xed

asse

ts a

s of

31

Dec

embe

r Ad

vanc

ed p

aym

ents

on

purc

hase

pro

pert

y an

d eq

uipm

ent a

nd p

roje

cts

und

er c

onst

ruct

ion

**N

et p

rope

rty

and

equi

pmen

t

9,34

1,88

6

14,3

60,0

9611

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,518

321,

879

2,10

7,26

437

,425

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9,34

1,88

6

9,34

1,88

6

14,8

62,1

4612

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,559

446,

985

2,36

6,93

239

,886

,508

-1,

223,

505

6,69

7,73

316

4,00

01,

402,

008

9,48

7,24

6

1,57

1,33

551

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(81,

253)

(38,

865)

262,

192

2,19

9,45

1

-50

2,05

020

0,47

584

,500

103,

248

890,

273

-80

0,40

3

(81,

270)

(45,

730)

86,3

3617

0,95

21,

057,

691

(152

,930

)

-

(146

,047

)

665,

831

-

314,

097

-

-

(2

5,92

9)

8,31

9,30

020

6,67

212

,174

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1,71

8,79

7

12,9

31,9

234,

549,

259

240,

313

27,7

11,5

1664

8,13

5

9,34

1,88

613

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4,67

2,78

124

0,31

328

,573

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648,

135

-73

8,57

112

3,52

2-

862,

093

-

-1,

930,

223-

-11

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(25,

930)

65

4,43

3

- -

*Ac

cord

ing

to th

e de

cisi

on ta

ken

by b

oard

of d

irec

tors

of t

he b

ank

and

the

seni

or m

anag

emen

t of A

l-M

awar

ed(S

ubsi

diar

y co

mpa

ny),

non

perf

orm

ing

cred

it fa

cilit

ies

with

thei

r re

late

d in

tere

st in

sus

pens

e ha

ve b

een

wri

tten

off

amou

nted

to o

f JD

1,3

55,7

42 d

urin

g th

e ye

ar e

nded

31

Dec

embe

r 20

16 a

gain

st J

D 9

,494

,144

for

the

year

201

5.

Bal

ance

s ge

nera

ted

from

inve

stm

ent i

n su

bsid

iari

es

-39

2,62

113

1,48

529

,710

80,5

2663

4,34

2

Bal

ance

s ge

nera

ted

from

inve

stm

ent i

n su

bsid

iari

es

An

nual

Rep

ort

34th

-

-Pr

oper

ty, p

lant

and

equ

ipm

ent i

nclu

de fu

lly d

epre

ciat

ed it

ems

amou

ntin

g to

JD

5,8

13,1

01as

of 3

1 D

ecem

ber

2016

agai

nst J

D 4

,048

,529

as

of 3

1 D

ecem

ber

2015

.

*Th

is it

em c

onta

ins

pled

ge la

nds

and

build

ings

by

JD 6

,222

,084

to th

e in

tere

st o

f spe

cial

ized

fina

nce

leas

e co

.ag

ains

t cap

ital l

ease

for

subs

idia

ry w

hich

am

ount

ed to

JD

6,3

81,7

47 a

s of

31

Dec

embe

r 20

15.

This

item

con

sist

s of

the

follo

win

g:

Bal

ance

at y

ear

end

35,6

8822

6,57

0

-

-

652,

698

652,

698

720,

369

(60,

899)

60,8

99

35,6

881,

537,

177

3,00

3,46

31,

955,

925

7,38

07,

380

-

1,69

2,85

647

9,23

2

60,8

991,

895,

026

1,43

0,59

8 - -

1,43

0,59

8--1,

955,

925

2,19

7,06

2

*Ad

ditio

ns r

epre

sent

the

amou

nts

paid

to a

cqui

re a

nd im

prov

e th

e ba

nkin

g sy

stem

s an

d pr

ogra

ms.

** T

he b

ank

acqu

ired

%93

.275

of J

orda

n Tr

ade

faci

litie

s C

o. d

urin

g th

e ye

ar 2

016,

thro

ugh

its s

ubsi

diar

y (T

amke

en L

easi

ng C

ompa

ny),

whi

ch o

wns

%10

0 of

Tra

de F

acili

ties

for

Fina

nce

Leas

ing

Com

pany

), as

the

bank

pur

chas

ed 1

5,39

0,38

5 sh

ares

with

1JD

sta

ted

valu

e. T

he a

cqui

sitio

n co

st J

D 2

0,77

4,62

0 an

dth

e ne

t ass

ets

fair

val

ue J

D 1

9,34

4,02

2 on

the

date

of a

cqui

sitio

n th

at r

aise

d a

good

will

am

ount

ed to

JD

1,4

30,5

98.

An im

pair

men

t tes

t has

bee

n pe

rfor

med

for

good

will

on

31 D

ecem

ber

2016

, in

whi

ch th

e G

oodw

ill

was

not

impa

ired

2015

Cost

Addi

tions

Dis

posa

ls

Dis

posa

ls

Addi

tions

Tran

sfer

s

Bal

ance

at 3

1 D

ecem

ber

Bal

ance

at 3

1 D

ecem

ber

Net

boo

k va

lue

of fi

xed

asse

ts a

s of

31

Dec

embe

r Ad

vanc

ed p

aym

ents

on

purc

hase

pro

pert

y an

d eq

uipm

ent a

nd p

roje

cts

und

er c

onst

ruct

ion

**N

et p

rope

rty

and

equi

pmen

t

9,07

8,79

910

,326

,486

6,99

3,74

931

7,12

91,

573,

880

28,2

90,0

43

132,

500

533,

384

8,93

1,38

82,

348,

137

1,88

3,75

7

(3,6

15)

4,03

3,61

0

(127

,750

)(1

31,3

65)

--

--

335,

577

321,

879

2,10

7,26

437

,425

,643

9,34

1,88

611

,294

,518

14,3

60,0

96

257,

688

1,09

4,09

57,

578,

944

--

5,26

5,56

2-

961,

599

(131

,228

)

164,

000

1,40

2,00

89,

487,

246

6,69

7,73

3-

1,22

3,50

5

157,

879

705,

256

27,9

38,3

979,

341,

886

4,59

6,78

513

,136

,591

-11

,398

789,

353

-77

7,95

5-

157,

879

716,

654

28,7

27,7

509,

341,

886

5,37

4,74

013

,136

,591

-

33

5,57

7-

An

nual

Rep

ort

34th

-

JDJD

31 D

ecem

ber

2016

31 D

ecem

ber

2015

Bal

ance

rel

ated

to fr

audu

lent

tran

sact

ions

Prov

isio

n re

late

d to

this

bal

ance

Proc

eeds

from

insu

ranc

e co

mpa

ny

Net

bal

ance

rel

ated

to fr

audu

lent

tran

sact

ions

12,9

74,7

00

(1,5

00,0

00)

12,

974,

700 -

(10,

435,

500)

(1

0,43

5,50

0)

1,03

9,20

0

2,5

39,2

00

The

Ban

k w

as im

pose

d to

em

bezz

lem

ent t

rans

actio

n in

the

bala

nces

at b

anks

and

fina

ncia

l ins

titut

ions

ac

coun

ts w

hich

led

to a

loss

of a

ppro

xim

atel

y JD

12.

9 m

illio

n. T

his

prim

arily

rel

ates

to th

e po

ssib

ility

of

collu

sion

bet

wee

n so

me

of th

e ba

nk’s

em

ploy

ees.

All

the

nece

ssar

y le

gal p

roce

dure

s w

ere

take

n by

the

bank

’s m

anag

emen

t and

a p

rovi

sion

for

an a

mou

nt o

f JD

10.

4 m

illio

n w

as b

ooke

d fo

r th

e tr

ansa

ctio

n as

of

31

Dec

embe

r 20

16 a

nd 3

1 D

ecem

ber

2015

aft

er n

ettin

g th

e am

ount

s ex

pect

ed to

be

reco

vere

d an

d th

ere

poss

esse

d as

sets

, and

ded

uctin

g pr

ocee

ds fr

om th

e in

sura

nce

com

pany

with

an

amou

nt o

f JD

1.5

mill

ion.

The

case

is s

till p

endi

ng a

t the

Gen

eral

Att

orne

y.

(13)

OTH

ER A

SSET

S

This

item

con

sist

s of

the

follo

win

g:

JDJD

31 D

ecem

ber

2016

31 D

ecem

ber

2015

Accr

ued

inte

rest

and

rev

enue

Prep

aid

expe

nses

*

Asse

ts s

eize

d by

the

Ban

k **

Ref

unda

ble

depo

sits

Bal

ance

s re

late

d to

frau

dule

nt tr

ansa

ctio

ns -

Net

***

Oth

ers

1,59

6,91

7

3,15

1,09

2

43,0

96,3

52

436,

480

134,

747

2,20

4,51

1

55,1

23,2

85

*Pr

epai

d ex

pens

es in

clud

e JD

18

mill

ion

whi

ch r

epre

sent

the

rent

of t

he n

ew b

ranc

h fo

r th

e ba

nk in

Abdo

un A

rea

for

18 y

ears

that

are

pai

d in

adv

ance

.

** T

he C

entr

al B

ank

of J

orda

n’s

inst

ruct

ions

req

uire

dis

posa

l of a

sset

s se

ized

by

the

bank

dur

ing

a m

axim

um p

erio

d of

two

year

s fr

om th

e da

te o

f for

eclo

sure

and

the

Cent

ral B

ank

of J

orda

n ca

n ex

tend

that

pe

riod

for

a m

axim

um o

f ano

ther

two

cons

ecut

ive

year

s. T

he b

alan

ce is

pre

sent

ed n

et o

f rel

ated

im

pair

men

t pro

visi

on fo

r th

e am

ount

of J

D 4

24,6

89 a

s of

31

Dec

embe

r 20

16 a

gain

st to

JD

496

,352

for

the

year

201

5, a

nd p

rovi

sion

for

asse

ts s

eize

d fo

r m

ore

than

four

yea

rs a

ccor

ding

to th

e in

stru

ctio

ns o

f Cen

tral

B

ank

of J

orda

n fo

r th

e am

ount

s of

JD

1,3

61,8

41 a

t 31

Dec

embe

r 20

16 a

gain

st J

D 2

80,4

15 a

s of

31

Dec

embe

r 20

15.

The

mov

emen

t on

asse

ts s

eize

d by

the

Ban

k w

as a

s fo

llow

s:

Post

-dat

ed C

hequ

es

Purc

hase

acc

epta

nces

1,03

9,20

0

3,46

3,98

6

JD

Bal

ance

at b

egin

ning

of t

he y

ear

Addi

tions

*

Bal

ance

at y

ear

end

2,88

9,85

22,

889,

852

13,5

21,9

95

46,6

99,5

7871

4,02

547

,413

,603

36,5

12,0

88

(7,0

99,4

09)

-(7

,099

,409

)(2

,379

,368

)

71,6

63-

71,6

63

39,3

03

(1,0

81,4

26)

-(1

,081

,426

)(2

80,4

15)

42,3

82,3

2771

4,02

543

,096

,352

47,4

13,6

03

Dis

posa

ls

Prov

isio

n fo

r as

sets

sei

zed

for

mor

eth

an 4

yea

rs *

*

(Pro

visi

on) A

mou

nt re

vers

ed fr

om

impa

irmen

t of a

sset

s se

ized

by

the

Bank

31 D

ecem

ber

2015

31 D

ecem

ber

2014

Seiz

ed

Asse

ts

Othe

r Se

ized

*As

sets

*Th

is it

em r

epre

sent

fair

val

ue o

f siz

ed s

tock

s ag

ains

t mat

ured

faci

litie

s am

ount

ed to

JD

683

,800

inad

ditio

n to

JD

30,

225

repr

esen

ts s

ized

tool

s as

of 3

1 D

ecem

ber

2016

and

31

Dec

embe

r 20

15.

** T

his

item

rep

rese

nt p

rovi

sion

aga

inst

siz

ed a

sset

s fo

r m

atur

ed fa

cilit

ies

and

bank

siz

ed it

for

mor

e th

an

four

yea

rs a

nd th

e pr

ovis

ion

agai

nst s

eize

d as

sets

for

mor

e th

an tw

o ye

ars

and

less

than

four

yea

rs

acco

rdin

g to

the

inst

ruct

ions

of C

entr

al B

ank

of J

orda

n.

***

This

item

incl

udes

net

bal

ance

rel

ated

to th

e fr

audu

lent

tran

sact

ions

aft

er d

educ

ting

the

rela

ted

prov

isio

n as

sho

wn

belo

w:

Tota

lJD To

tal

1,59

4,05

6

3,08

5,64

9

47,4

13,6

03

1,59

8,72

7

2,53

9,20

0

354,

018

59,0

66,1

38

111,

007

2,36

9,87

8

Bal

ance

s ge

nera

ted

from

inve

stm

ent

in s

ubsi

diar

ies

902,

069

-

9

02,0

69-

-

52

Annu

al R

epor

t 34

th

This

item

con

sist

s of

the

follo

win

g:

Curr

ent a

ccou

nts

Tim

e an

d no

tice

Dep

osits

*

Tota

l

*Th

is a

mou

nt d

oes

not i

nclu

de a

ny a

mou

nt m

atur

ing

with

in a

per

iod

exce

edin

g th

ree

mon

ths

as o

fD

ecem

ber

2016

and

201

5

This

item

con

sist

s of

the

follo

win

g:

Savi

ng d

epos

its

Dep

osits

cer

tifica

tes

Savi

ng d

epos

its

Dep

osits

cer

tifica

tes

35,5

172,

365,

638

2,40

1,15

552

,788

2,90

6,80

42,

959,

592

31,8

43-

31,8

4331

,683

6,02

7,00

06,

058,

683

67,3

602,

365,

638

2,43

2,99

884

,471

8,93

3,80

49,

018,

275

336,

911,

427

248,

498,

356

25,9

62,3

99

62,2

73,4

22

213,

948,

456

162,

691,

700

524,

055

50,7

32,7

01

25,1

29,7

00

9,08

7,44

7

286,

619

15,7

55,6

34

46,8

27,1

60

45,6

14,9

82

1,87

7

1,21

0,30

1

622,

816,

743

465,

892,

485

26,7

74,9

50

129,

972,

058

15,6

24,0

4011

8,70

6,25

1

18,3

33,8

2948

1,73

4,38

81,

8

215,

229,

166

8,83

7,06

944

5,52

0,56

2

297,

886

- -

-

29

7,88

6

25,1

95,4

9758

4,07

6,35

5

This

item

con

sist

s of

the

follo

win

g:

Cash

mar

gins

on

dire

ct c

redi

t fac

ilitie

s

Cash

mar

gins

on

indi

rect

cre

dit f

acili

ties

Oth

er m

argi

ns

22,8

27,7

05

9,32

3,95

2

5,75

0

32,1

57,4

07

26,7

00,5

06

11,3

88,5

71

5,75

0

38,0

94,8

27

Bor

row

ed fu

nds

are

deta

iled

as fo

llow

s:

31 D

ecem

ber

2016

Bor

row

ed lo

ans

from

bank

s/ L

ocal

inst

ituat

ion

99,7

89,6

24

99,7

89,6

24

Mon

thly

,Qua

rter

ly,

Sem

i Ann

ually

and

on

mat

urity

dat

e

Mor

tgag

e gu

rant

ee/

Tool

s an

d eq

uipm

ent

gura

ntee

%4.

3 to

%8.

25

185

143

Mon

thly

,Qua

rter

ly,

Sem

i Ann

ually

and

on

mat

urity

dat

e

Mor

tgag

e gu

rant

ee/

Tool

s an

d eq

uipm

ent

gura

ntee

%4.

5 to

%7.

75

31 D

ecem

ber

2015

Bor

row

ed lo

ans

from

bank

s/ L

ocal

inst

ituat

ion

-G

over

nmen

t and

Pub

lic s

ecto

r de

posi

ts a

mou

nted

to J

D 4

6,82

7,16

0 w

hich

is e

quiv

alen

t to

%7.

5 of

tota

lcu

stom

er’s

dep

osits

as

of 3

1 D

ecem

ber

2016

aga

inst

JD

8,3

75,0

92 w

hich

is e

quiv

alen

t to

(%14

.1) o

f tot

alcu

stom

er’s

dep

osits

as

of 3

1 D

ecem

ber

2015

.

-N

on-i

nter

est b

eari

ng d

epos

its a

mou

nted

to J

D 1

53,4

26,5

82 w

hich

is e

quiv

alen

t to

%24

.6 o

f tot

al c

usto

mer

sde

posi

ts a

s of

31

Dec

embe

r 20

16 a

gain

st J

D 1

41,4

71,8

78, w

hich

is e

quiv

alen

t to

(%24

.2)o

f tot

al c

usto

mer

sde

posi

ts a

s of

31

Dec

embe

r 20

15.

-R

estr

icte

d de

posi

ts a

mou

nted

to J

D 8

,808

286

whi

ch is

equ

ival

ent t

o %

1.4

of to

tal c

usto

mer

’s d

epos

its a

s of

31 D

ecem

ber

2016

aga

inst

JD

13,

483,

960,

whi

ch is

equ

ival

ent t

o (%

2.3)

as

of 3

1 D

ecem

ber

2015

.

-D

orm

ant d

epos

its a

mou

nted

to J

D 5

,382

,574

as

of 3

1 D

ecem

ber

2016

aga

inst

JD

5,3

64,8

53 a

s of

31

Dec

embe

r 20

15.

978

715

-B

orro

wed

fund

s re

pres

ents

cre

dit f

acili

ties

from

loca

l ban

ks a

mou

nted

to J

D 7

2,28

9,62

4 an

d in

form

of o

verd

raft

acco

unts

and

rev

olvi

ng lo

ans

gran

ted

to th

e su

bsid

iary

com

pani

es (T

amke

enLe

asin

g Co

mpa

ny a

nd A

l-Is

teth

mar

iLe

Tam

wee

l Sel

sela

t Al I

mda

d) a

gain

st th

e gu

aran

tee

of th

e su

bsid

iari

es’ n

etw

orth

.

-B

orro

wed

fund

s al

so c

onta

ins

cred

it fa

cilit

ies

gran

ted

from

Jor

dan

Mor

tgag

e re

finan

cing

com

pany

am

ount

ed to

JD27

,500

,000

, and

ban

k re

finan

ce a

n ho

usin

g lo

ans

for

inte

rest

rat

e of

%7.

5.

-Fi

xed

inte

rest

loan

s am

ount

ed to

JD

78,

789,

624

and

vari

able

inte

rest

loan

sam

ount

ed 2

1,00

0,00

0 as

of 3

1 D

ecem

ber

2016

aga

inst

fixe

d in

tere

st lo

ans

amou

nted

42,

322,

037

and

ther

e is

no

loan

sin

tere

st r

ates

as

of 3

1 D

ecem

ber

2015

.

-Pa

rt o

f the

col

late

rals

of t

he d

ue

and

fina

nce

leas

e co

ntra

ct r

elat

ed to

Jor

dan

Tard

e Fa

cilit

ies

Com

pany

with

an

amou

nt o

f JD

16,

937,

500

(Che

ques

and

pro

mis

sory

not

es) a

s of

31

Dec

embe

r 20

16 w

ere

depo

site

das

colla

tera

ls a

gain

st th

e lo

ans

and

over

draf

t of t

he c

ompa

ny.

An

nual

Rep

ort

34th

This

item

con

sist

s of

the

follo

win

g:

31 D

ecem

ber

2016

Prov

isio

n fo

r em

ploy

ees

end-

of s

ervi

ce in

dem

nity

Prov

isio

n fo

r la

wsu

its

agai

nst t

he B

ank(

Not

e 46

)

Oth

ers

31 D

ecem

ber

2015

Prov

isio

n fo

r em

ploy

ees

end-

of s

ervi

ce in

dem

nity

Prov

isio

n fo

r la

wsu

its

agai

nst t

he B

ank(

Not

e 46

)

Oth

ers

-

-

-

-

19,6

2713

,466

-

33,0

93

608,

094

52,3

1822

,956

636,

373

1,06

2,46

3

1,08

2,09

0

215,

613

229,

079

640,

620

- 60

0,00

036

,373

659,

329

652,

318

710,

086

608,

094 -

-

5,00

0

-

-

-

-

-

-

5,00

0

12,3

207,

307

-

19,6

27

108,

830

906,

781

924,

101

-

264,

512

-

271,

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1,06

2,46

3

1,08

2,09

011

3,83

0

A.Pr

ovis

ion

for

inco

me

tax

The

mov

emen

t on

the

prov

isio

n fo

r in

com

e ta

x is

as

follo

ws:

Bal

ance

at t

he b

egin

ning

of t

he y

ear

Bal

ance

s ge

nera

ted

from

inve

stm

ent i

n su

bsid

iari

es

Tota

l inc

ome

tax

paid

Prio

r ye

ar’s

inco

me

tax

Inco

me

tax

for

the

year

Bal

ance

at y

ear

end

Inco

me

tax

prov

isio

n fo

r th

e ye

ar e

nded

31

Dec

embe

r 20

16 a

nd 2

015

was

cal

cula

ted

acco

rdin

g to

app

licab

le

law

s, r

egul

atio

ns a

nd In

tern

atio

nal fi

nanc

ial r

epor

ting

stan

dard

s.

6,20

8,28

73,

467,

908

278,

912

-

(7,1

17,6

09)

(4,0

92,0

44)

143,

763

-

6,98

8,10

16,

832,

423

6,50

1,45

46,

208,

287

Inco

me

tax

expe

nse

for

the

year

con

sist

s of

the

follo

win

g:

Prio

r ye

ar’s

inco

me

tax

Def

erre

d ta

x as

sets

Amor

tizat

ion

of d

efer

red

tax

asse

ts

Def

erre

d ta

x lia

bilit

ies

Amor

tizat

ion

of d

efer

red

tax

liab

ilitie

s

Bal

ance

at y

ear

end

855,

082 -

6,77

0,96

7

660,

769

(1,2

29,2

76)

(805

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)

163,

372

-

6,98

8,10

16,

832,

423

27,1

57

(6,3

12)

(419

,463

)

6,29

5,01

8

Inco

me

tax

on p

rofit

for

the

yea

The

lega

l inc

ome

tax

rate

in J

orda

n fo

r th

e B

ank

is %

35 a

nd fo

r th

e su

bsid

iari

es is

%24

.

Tax

stat

us o

f the

Ban

kTh

e ba

nk h

as r

each

ed to

a fi

nal s

ettle

men

t with

the

Inco

me

and

Sale

s Ta

x D

epar

tmen

t up

to th

e en

d of

the

year

201

3 an

d In

com

e an

d sa

les

tax

depa

rtm

ent a

ccep

ted

year

201

4 ta

x re

turn

s w

ithou

t any

am

endm

ents

.

The

bank

pro

vide

d its

tax

decl

arat

ion

for

the

year

201

5 on

the

peri

od s

peci

fied

lega

lly a

nd S

ales

Tax

D

epar

tmen

t did

not

rev

ise

reco

rd u

ntil

the

date

of p

repa

ratio

n of

thes

e fin

anci

al s

tate

men

ts.

As p

er th

e op

inio

n of

the

com

pany

’ man

agem

ent a

nd it

s ta

x ad

viso

r, th

e ta

x lia

bilit

ies

exce

edin

g th

e bo

oked

pr

ovis

ion

as o

f 31

Dec

embe

r 20

16.

Tax

stat

us o

f Al M

awar

ed fo

r Fi

nanc

ial B

roke

rage

Com

pany

(Sub

sidi

ary

Com

pany

)

The

com

pany

has

rea

ched

to a

fina

l set

tlem

ent w

ith th

e in

com

e an

d sa

les

tax

depa

rtm

ent f

or th

e pe

riod

si

nce

ince

ptio

n on

5 J

une

2006

till

the

end

of

the

year

201

1. M

oreo

ver,

Inc

ome

and

sale

s ta

x de

part

men

t ac

cept

ed y

ears

201

,201

and

201

4 ta

x re

turn

s w

ithou

t any

am

endm

ents

.

As p

er th

e op

inio

n of

the

com

pany

’ man

agem

ent a

nd it

s ta

x co

nsul

tant

, the

com

pany

will

not

hav

e an

y ta

x lia

bilit

ies

exce

edin

g th

e bo

oked

pro

visi

on a

s of

31

Dec

embe

r 20

16.

Tax

stat

us o

f Tam

keen

Lea

sing

Com

pany

(Sub

sidi

ary

Com

pany

)

The

com

pany

has

not

sub

mitt

ed it

s ta

x re

turn

for

the

peri

od s

ince

ince

ptio

n on

31

Oct

ober

200

6 to

31

Dec

embe

r 20

07 a

nd fo

r th

e ye

ars

2008

and

200

9.

The

com

pany

has

rea

ched

to a

fina

l set

tlem

ent w

ith th

e in

com

e an

d sa

les

tax

depa

rtm

ent f

or th

e ye

ars

,201

0 20

1,2

01 ,2

01 a

nd 2

014.

As p

er th

e op

inio

n of

the

com

pany

’s m

anag

emen

t and

its

tax

cons

ulta

nt, t

he c

ompa

ny w

ill n

ot h

ave

any

tax

liabi

litie

s ex

ceed

ing

the

book

ed p

rovi

sion

as

of 3

1 D

ecem

ber

2016

.

An

nual

Rep

ort

34th

B.D

efer

red

tax

asse

ts/L

iabi

litie

sTh

is it

em c

onsi

sts

of th

e fo

llow

ing:

Acco

unts

incl

uded

A-D

efer

red

Tax

Asse

ts

B-

Def

erre

d Ta

x Li

abili

ties

Prov

isio

n fo

r em

ploy

ees

end-

of-s

ervi

ce in

dem

nitie

s

Prov

isio

n fo

r la

wsu

its

agai

nst t

he B

ank

Prov

isio

n fo

r de

bts

Wat

ch li

st

Prov

isio

n fo

r la

wsu

its/ J

orda

nTr

ade

Faci

litie

s Co

mpa

ny

Prov

isio

n fo

r im

pair

men

t in

seiz

ed a

sset

s by

the

Ban

k

Prov

isio

n fo

r im

pair

men

t on

por

tfol

io

6,86

9

302,

515 -

Prov

isio

n fo

r bu

ildin

gs o

wne

d m

ore

than

four

yea

rs

Chan

ge in

fair

val

ue r

eser

veEf

fect

of e

arly

ado

ptio

n of

IF

RS

(9)

1,79

1,76

3 -5,

016,

973

938,

678

8,27

4,26

6

Prov

isio

n fo

r im

pairm

ent i

n fin

anci

al b

roke

rage

Prov

isio

n fo

r dou

btfu

l deb

t –

Jord

an T

rade

Fac

ilitie

s Co

mpa

nyUn

paid

boa

rd o

f dire

ctor

s bon

uses

/ A

l Maw

ared

Com

pany

9,60

0

Prov

ision

aga

inst

bal

ance

s rel

ated

to fr

audu

lent

tran

sact

ions

*

Unpa

id e

mpl

oyee

s bon

us

Unp

aid

boar

d of

dir

ecto

rsre

mun

erat

ions

12,0

00

3,65

2,42

5

280,

652

19,6

27

328,

537

--

--

-

880,

327

33,0

9313

,466

--

130,

559

141,

841

49,6

44

22,9

56

853,

046

-

880,

327 -

71,6

63-

1,08

1,42

6-

-

--

-

275,

317

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741,

657

40,0

0050

,000

-

--

-

308,

114

173,

723

424,

689

148,

641

98,1

4547

6,64

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361,

841

11,5

83

371,

862

1,06

2,46

3

864,

328

22,9

56

640,

620

215,

613

637,

456

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4,21

7

--

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496,

352

280,

415

1,79

1,76

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0,01

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50,0

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2,42

510

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,500

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678

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1,86

3

114,

630

37,7

0840

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80,9

3174

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7,73

7

2,36

8,20

7-

-5,

906,

059

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-18

,033

10,4

35,5

00

2,06

7,12

1

6,31

2

2,81

2,85

0

8,27

4,26

6

1,20

4,07

4-

Tax

stat

us o

f Al I

stet

hmar

i Let

amw

eel S

else

lat A

l Im

dad

Com

pany

(Sub

sidi

ary

Com

pany

)

The

com

pany

has

rea

ched

to a

fina

l set

tlem

ent w

ith th

e in

com

e an

d sa

les

tax

depa

rtm

ent u

ntil

the

end

of

the

year

201

0.

Inco

me

and

sale

s ta

x de

part

men

t acc

epte

d ye

ars

201

,201

2 ,2

01 a

nd 2

014

As p

er th

e op

inio

n of

the

com

pany

’s m

anag

emen

t and

its

tax

cons

ulta

nt, t

he c

ompa

ny w

ill n

ot h

ave

any

tax

liabi

litie

s ex

ceed

ing

the

book

ed p

rovi

sion

as

of 3

1 D

ecem

ber

2016

.

Tax

stat

us o

f Jor

dan

Trad

e Fa

cilit

ies

Com

pany

(Sub

sidi

ary

Com

pany

)

The

Inco

me

and

Sale

s Ta

x de

part

men

t had

fina

lized

its

revi

ew a

nd is

sued

a fi

nal c

lear

ance

up

to th

e ye

ar e

nded

31

Dec

embe

r 20

11. T

he C

ompa

ny r

aise

d a

law

sui

t aga

inst

the

inco

me

tax

depa

rtm

ent i

n th

e re

late

d co

urts

cla

imin

g ba

ck a

mou

nt o

f JD

419,

000

for

2009

and

stil

l in

the

case

in c

ourt

. Als

o th

e Co

mpa

ny r

aise

d a

lega

l cas

e in

the

spec

ializ

ed c

ourt

for

the

tax

impo

sed

in 2

010.

The

app

eal d

ecis

ion

has

been

dec

lare

d on

19

Dec

embe

r 20

16

appr

ovin

g th

e am

ount

rec

orde

d in

the

corp

orat

e in

com

e ta

x re

turn

not

ing

that

the

amou

nt is

pai

d in

full.

The

co

mpa

ny w

ill a

ppea

l thi

s de

cisi

on in

the

cour

t. Th

e m

anag

emen

t and

the

tax

advi

sor

exce

pt ta

x su

rplu

s am

ount

of

JD 1

40,0

00.

The

Com

pany

sub

mitt

ed c

orpo

rate

inco

me

tax

retu

rn fo

r th

e ye

ars

201

,201

and

201

4 on

the

due

date

s. T

he

Inco

me

and

Sale

s Ta

x de

part

men

t had

fina

lized

its

revi

ew a

nd is

sued

a fi

nal c

lear

ance

for

2012

and

201

3. F

or 2

014

it w

as a

ccep

ted

unde

r th

e sa

mpl

e ba

sis.

The

Com

pany

sub

mitt

ed c

orpo

rate

inco

me

tax

retu

rn fo

r th

e ye

ar e

nded

31

Dec

embe

r 20

15 o

n th

e du

e da

te. T

he

Inco

me

and

Sale

s Ta

x de

part

men

t did

not

rev

iew

the

inco

me

tax

for

the

year

201

5 up

to d

ate

of is

suin

g th

e fin

anci

al s

tate

men

ts.

The

Subs

idia

ry “

Jord

an F

acili

ties

for

Fina

nce

Leas

e L.

L.C

“sub

mitt

ed c

orpo

rate

inco

me

tax

retu

rn u

p to

the

year

en

ded

31 D

ecem

ber

2014

and

it w

as a

ccep

ted

unde

r th

e sa

mpl

e ba

sis

As p

er th

e op

inio

n of

the

com

pany

’ man

agem

ent a

nd it

s ta

x co

nsul

tant

, the

com

pany

and

its

subs

idia

ry w

ill n

ot

have

any

tax

liabi

litie

s ex

ceed

ing

the

book

ed p

rovi

sion

as

of 3

1 D

ecem

ber

2016

.

Def

erre

d ta

x lia

bilit

ies

incl

ude

an a

mou

nt o

f JD

2,8

12,8

50 a

s of

31

Dec

embe

r 20

16 a

gain

st J

D 2

,067

,121

as

of 3

1 D

ecem

ber

2015

whi

ch r

epre

sent

s ta

x lia

bilit

ies

agai

nst g

ains

on

the

eval

uatio

n of

fina

ncia

l ass

ets

at

fair

val

ue th

roug

h ot

her

com

preh

ensi

ve in

com

e w

hich

is s

how

n un

der

fair

val

ue r

eser

ve in

ow

ners

' equ

ity.

In a

dditi

on, t

here

's a

n am

ount

of J

D Z

ero

as o

f 31

Dec

embe

r 20

16 a

gain

st J

D 6

,312

as

of 3

1 D

ecem

ber

2015

re

pres

ents

def

erre

d ta

x lia

bilit

ies

on g

ain

on fi

nanc

ial a

sset

s at

fair

val

ue th

roug

h pr

ofit o

r lo

ss w

hich

is

rela

ted

to th

e ea

rly

adop

tion

of IF

RS

(9).

*Th

is it

em r

epre

sent

s th

e de

ferr

ed ta

x be

nefit

s ex

pect

ed fr

om th

e pr

ovis

ion

book

ed a

gain

st th

e ba

lanc

esre

late

d to

the

frau

dule

nt tr

ansa

ctio

ns (n

ote

13),

and

the

man

agem

ent b

elie

ves

thes

e am

ount

s ca

n be

reco

vere

d fr

om in

the

futu

res.

An

nual

Rep

ort

34th

The

mov

emen

t on

defe

rred

tax

asse

ts /

liabi

litie

s w

as a

s fo

llow

s:

Bal

ance

at t

he b

egin

ning

of t

he y

ear

Bal

ance

s ge

nera

ted

from

inve

stm

ent

in s

ubsi

diar

ies

Addi

tions

Ded

uctio

ns

Bal

ance

at y

ear

end

5,36

5,91

52,

073,

433

1,22

9,27

673

9,41

7

855,

082

-

6,88

3,61

52,

812,

850

C.Th

e su

mm

ary

of th

e re

conc

iliat

ion

betw

een

acco

untin

g pr

ofit a

nd ta

xabl

e pr

ofit i

s as

foll

ows:

Acco

untin

g pr

ofit f

or th

e ye

a

Non

-tax

able

pro

fi

Expe

nses

not

ded

uctib

le fo

r ta

x pu

rpos

es

Taxa

ble

profi

Inco

me

tax

perc

enta

ge fo

r th

e B

ank

Def

erre

d ta

xes

perc

enta

ge fo

r th

e B

ank

Inco

me

tax

perc

enta

ge fo

r th

e su

bsid

iary

com

pani

es

Def

erre

d ta

x pe

rcen

tage

for

the

subs

idia

ry c

ompa

nies

22,3

78,2

26

(6,0

42,1

26)

6,02

4,57

0

22,3

60,6

70

%35

%35

%24

%24

This

item

con

sist

s of

the

follo

win

g:

Bro

kera

ge p

ayab

le

Acce

pted

and

cer

tified

che

ck

Accr

ued

inte

rest

Sund

ry c

redi

tors

Div

iden

ds p

ayab

le

Dep

osits

on

safe

dep

osit

boxe

s

Accr

ued

expe

nses

Oth

er li

abili

ties

544,

726

1,04

1,83

2

3,23

0,26

9

3,32

6,20

2

94,4

68

110,

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per

sha

re a

s of

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end

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of 3

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as

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me

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ral B

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ral b

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isks

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ral B

ank

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item

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sist

s of

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follo

win

g:

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ance

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erre

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x lia

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Unr

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ain

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n sa

le o

f fina

ncia

l ass

ets

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ugh

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r co

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ance

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nd o

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yea

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cial

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nted

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er d

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ting

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rred

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liabi

litie

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inst

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item

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gain

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rict

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nt o

f JD

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nual

Rep

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34th

2016

2015

This

item

con

sist

s of

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follo

win

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This

item

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follo

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item

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follo

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pani

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item

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sist

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This

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sist

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ded

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com

mun

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nual

Rep

ort

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This

item

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sist

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the

follo

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This

item

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Ren

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Subs

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fees

Tele

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This

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sist

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the

follo

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g:

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JD

Cash

on

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bal

ance

s at

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Cent

ral B

ank

mat

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with

in th

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mon

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pres

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-per

form

ing

cred

it fa

cilit

ies

Pro

visi

on fo

r no

n-pe

rfor

min

g cr

edit

faci

litie

s

Inte

rest

in s

uspe

nse

*Su

ch b

alan

ces

and

tran

sact

ions

are

elim

inat

ed in

the

cons

olid

ated

fina

ncia

l sta

tem

ents

and

are

sho

wfo

r ex

plan

ator

y pu

rpos

es o

nly.

Exec

utiv

e m

anag

emen

t sal

arie

s an

d be

nefit

s am

ount

ed to

JD

2,6

45,7

38 fo

r th

e ye

ar e

nded

31

Dec

embe

r 20

16

agai

nst J

D 2

,529

,196

for

the

year

201

5

Max

imum

cre

dit i

nter

est r

ate

in J

orda

nian

din

ars

2

1 M

inim

um c

redi

t int

eres

t rat

e in

Jor

dani

an d

inar

s 2.

75

Max

imum

cre

dit i

nter

est r

ate

in o

ther

cur

renc

ies

4

Min

imum

cre

dit i

nter

est r

ate

in o

ther

cur

renc

ies

3

Max

imum

deb

it in

tere

st r

ate

in J

orda

nian

din

ars

4.2

5M

inim

um d

ebit

inte

rest

rat

e in

Jor

dani

an d

inar

s

0

Max

imum

deb

it in

tere

st r

ate

in o

ther

cur

renc

ies

M

inim

um d

ebit

inte

rest

rat

e in

oth

er c

urre

ncie

s

0

Max

imum

cre

dit c

omm

issi

on r

ate

0.1

M

inim

um c

redi

t com

mis

sion

rat

e

6,70

0,32

64,

148,

205

43,5

85,7

5454

,434

,285

44,8

91,3

27

- -

--

5,07

9,61

8

990,

679

2,83

0,20

832

,968

,517

36,7

89,4

0424

,541

,295

- -

1

40,2

6314

0,26

319

,163

1,36

4,62

591

1,40

27,

298,

477

9,57

4,50

49,

993,

374

306,

062

302,

852

6,46

9,02

47,

077,

938

2,61

4,30

0

94,9

3942

,715

177,

180

314,

834

703,

801

- -

(5,0

79,6

18)

(5,0

79,6

18)

3,56

5,62

1

- -

-

-

-

-

-

- -

-

- -

-

- -

1,45

7,64

4

- -

606,

998

-

11,4

96,0

28

-

4,47

2,62

0

-

3,96

9,63

0

Gene

ral f

ram

ewor

k of

ris

k m

anag

emen

t

The

bank

has

iden

tified

con

trol

leve

ls (d

efen

se li

nes)

by

plac

ing

the

fram

ewor

k fo

r th

e fo

llow

ing

cont

rol l

evel

s as

follo

ws:

•B

usin

ess

units

: rep

rese

nts

empl

oyee

s th

at a

re p

art o

f firs

t lin

e de

fens

e, w

hich

res

pons

ible

for

risk

man

agem

ent a

nd r

elat

edco

ntro

l pro

cedu

res.

•In

depe

nden

t ris

k m

anag

emen

t fun

ctio

n: th

e em

ploy

ees

of r

isk

man

agem

ent d

epar

tmen

t rep

rese

nt th

e se

cond

line

def

ense

by m

akin

g th

em r

espo

nsib

le o

ver

arra

ngin

g ri

sk m

anag

emen

t effo

rts

and

faci

litat

ing

the

supe

rvis

ion

proc

ess

over

the

impl

emen

ted

proc

edur

es fr

om th

e ba

nk.

•Co

mpl

ianc

e D

epar

tmen

t: th

e em

ploy

ees

of c

ompl

ianc

e de

part

men

t rep

rese

nt a

noth

er p

art i

n th

e se

cond

line

def

ense

by

assu

re o

f com

plyi

ng w

ith th

e im

plem

ente

d pr

oced

ures

, law

s an

d re

gula

tions

.

•In

tern

al a

udit:

Inte

rnal

aud

it em

ploy

ees

repr

esen

t the

thir

d lin

e de

fens

e, a

nd th

ey a

re r

espo

nsib

le fo

r pe

rfor

min

g an

inde

pend

ent r

evie

w fo

rco

ntro

l pro

cedu

res

and

syst

ems

that

are

rel

ated

to r

isk

man

agem

ent a

t the

ban

k le

vel.

In a

dditi

on, t

he B

ank

had

esta

blis

hed

a ri

sk m

anag

emen

t com

mitt

ee fr

om th

e bo

ard

of d

irec

tors

in o

rder

to m

anag

e th

e ri

sks

that

the

bank

is e

xpos

ed to

. Th

ese

risk

s ar

e m

anag

ed to

miti

gate

d th

e im

pact

of t

hese

ris

ks to

ens

ure

prop

er a

lignm

ent w

ith

the

bank

str

ateg

y

The

Ris

k M

anag

emen

t Com

mitt

ee's

task

s ar

e as

follo

ws:

A.To

sup

ervi

se th

e m

anag

emen

t of t

he r

isk

polic

y an

d en

sure

that

the

Ris

k M

anag

emen

t and

Com

plia

nce

Dep

artm

ent

achi

eves

its

obje

ctiv

es a

ccor

ding

to th

e ap

prov

ed p

olic

ies.

B.T

o en

sure

app

ropr

iate

and

suf

ficie

nt s

uppo

rt fo

r th

e R

isk

Man

agem

ent a

nd C

ompl

ianc

e D

epar

tmen

t in

achi

evin

g its

obje

ctiv

es in

acc

orda

nce

with

the

appr

oved

pol

icie

s an

d pr

oced

ures

and

the

Cent

ral B

ank'

s in

stru

ctio

ns.

C.To

ens

ure

the

avai

labi

lity

of w

ork

proc

edur

es fo

r ri

sk m

anag

emen

t in

com

plia

nce

with

the

vari

ous

man

agem

ent r

isk

polic

ies

at th

e B

ank.

D.T

o en

sure

the

use

of th

e ne

w te

chni

ques

and

met

hod

of m

anag

emen

t and

ass

essm

ent o

f ris

k m

anag

emen

t.

E.To

iden

tify

basi

s an

d pr

inci

ples

of r

isk

man

agem

ent a

nd r

isk

acce

ptan

ce, r

isk

tran

sfer

, ris

k re

fuse

and

ris

k m

itiga

tion.

F.To

rev

iew

the

peri

odic

al r

epor

ts o

f the

Ris

k M

anag

emen

t and

Com

plia

nce

Dep

artm

ent.

G.T

o en

sure

that

the

Ban

k ad

here

s to

the

Cent

ral B

ank

of J

orda

n in

stru

ctio

ns.

H.T

o re

view

the

inte

rnal

cal

cula

tion

of c

apita

l ade

quac

y fo

r th

e ba

nk a

nd p

rese

nt it

to th

e bo

ard

of d

irec

tors

, tak

ing

inco

nsid

erat

ion

the

bank

str

ateg

ies

and

plan

s.

I.En

sure

the

inde

pend

ency

of t

he r

isk

depa

rtm

ent.

The

Ris

k M

anag

emen

t and

Com

plia

nce

Com

mitt

ee h

ave

set t

he r

isk

man

agem

ent f

ram

ewor

k fo

r th

e B

ank.

Mor

eove

r, th

e B

oard

of D

irec

tors

has

est

ablis

hed

the

Ris

k M

anag

emen

t and

Com

plia

nce

Com

mitt

ee, f

orm

ed b

y th

e B

oard

mem

bers

and

ex

ecut

ive

man

agem

ent.

Its o

bjec

tive

is to

mon

itor

and

cont

rol t

he v

ario

us r

isks

(cre

dit r

isks

, ope

ratin

g ri

sks,

mar

ket r

isks

and

co

mpl

ianc

e ri

sks)

or

any

othe

r ri

sks

the

Ban

k m

ight

be

expo

sed

to.

The

depa

rtm

ent m

anag

es th

e B

ank'

s va

riou

s ri

sks

(cre

dit r

isk,

ope

ratin

g ri

sk, m

arke

t ris

k, c

ompl

ianc

e ri

sk, a

nd o

ther

ris

ks)

with

in th

e ge

nera

l fra

mew

ork

of r

isks

man

agem

ent.

The

role

of t

he d

epar

tmen

t can

be

sum

mar

ized

as

follo

ws:

•R

isk

Iden

tifica

tion.

•R

isk

Asse

ssm

ent.

•R

isk

Cont

rol /

Miti

gatio

n.•

Ris

k M

onito

ring

.

The

Ban

k m

anag

ed to

pre

pare

the

requ

ired

pla

ns a

nd a

ctio

n po

ints

to e

nsur

e th

e co

mpl

ianc

e w

ith th

e Ce

ntra

l Ban

k of

Jor

dan

inst

ruct

ions

rel

ated

to (B

asel

III)

and

inte

rnal

cap

ital a

dequ

acy

asse

ssm

ent p

roce

ss.

An

nual

Rep

ort

34th

Cred

it ri

sks

are

defin

ed a

s th

e pr

obab

ility

of n

ot fu

lly r

ecov

erin

g th

e de

bt o

r in

tere

st in

the

spec

ified

tim

e ca

usin

g fin

anci

al lo

sses

to th

e B

ank.

Mor

eove

r, c

redi

t ris

k re

pres

ents

the

maj

or p

ortio

n ba

nks

are

expo

sed

to in

gen

eral

. In

reco

gniti

on o

f thi

s re

ality

, the

Ban

k ha

s ac

cord

ed c

redi

t ris

k m

anag

emen

t gre

at s

igni

fican

ce th

roug

h m

anag

ing

cred

it ri

sks

at

the

port

folio

leve

l, ec

onom

ic s

ecto

r le

vel,

grou

p le

vel,

or s

ingl

e cu

stom

er le

vel,

taki

ng in

to c

onsi

dera

tion

the

achi

evem

ent o

f an

appr

opri

ate

retu

rn o

n th

e ri

sks

the

Ban

k is

exp

osed

to.

To a

chie

ve th

is, b

ased

on

the

risk

man

agem

ent s

trat

egy,

the

Ban

k ha

s pe

rfor

med

the

follo

win

g:

1.Th

e ri

sk a

ppet

ite a

nd c

eilin

gs a

re b

ased

on

cred

it ri

sk c

omm

ensu

rate

with

the

acce

ptab

le r

isk

limits

adop

ted

by th

e B

oard

of D

irec

tors

and

Ris

ks a

nd C

ompl

ianc

e D

epar

tmen

t. R

isk

limits

are

set

for

each

clie

nt,

grou

p an

d ec

onom

ic s

ecto

r, in

ord

er to

miti

gate

the

Ban

k's

expo

sure

to c

redi

t ris

k co

ncen

trat

ions

.

2.Th

e ba

nk im

plem

ente

d a

cred

it ri

sk r

atin

g sy

stem

from

Moo

dy’s

com

pany

for

Corp

orat

e an

d re

tail

com

pani

es, t

his

will

impa

ct o

n th

e qu

ality

of c

redi

t por

tfol

io a

nd w

ill h

elp

in ta

king

the

appr

opri

ate

cred

itde

cisi

ons.

3.Cr

edit

risk

is m

itiga

ted

thro

ugh

cred

it ri

sk fa

ctor

s (c

olla

tera

ls s

uch

as r

eal e

stat

e, s

hare

s or

oth

er)

com

men

sura

te w

ith th

e cr

edit

risk

face

d by

the

Ban

k to

cov

er a

ny u

nexp

ecte

d su

bseq

uent

eve

nts.

4.Pr

oper

lega

l and

cre

dit d

ocum

enta

tion

is a

pplie

d fo

r al

l con

ditio

ns a

ssoc

iate

d w

ith th

e cr

edit

faci

litie

s.

1.Cr

edit

risk

exp

osur

e (l

ess

the

impa

irm

ent p

rovi

sion

and

inte

rest

in s

uspe

nse

and

befo

regu

aran

tees

and

oth

er r

isk

- m

itiga

ting

fact

ors)

:

On

finan

cial

pos

ition

sta

tem

ent i

tem

s:

Bal

ance

s at

the

cent

ral b

ank

of J

orda

n80

,495

,887

7,14

1,47

2

95,7

27,9

74

190,

244

73,8

86

7,33

4,65

7

851,

811

1,46

3,92

2

10,6

36,9

38

123,

156,

774

8,89

3,36

4

1,71

0,43

5

112,

552,

975

-

118,

986,

354

258,

812

41,4

51

3,53

4,94

3

20,6

29

472,

328

1,69

9,34

3

124,

713,

597

1,01

9,07

7

626,

434

123,

068,

086

5,10

8,32

0

299,

363,

259

7,01

2,85

4

3,29

9,29

9

3,44

9,59

5

685,

191

10,2

90,1

26

8,03

5,54

9

326,

932,

040

10,0

81,1

95

2,83

4,88

8

314,

015,

957

777,

328

13,3

71,0

09

129,

216

82,5

69

1,69

1,83

6

34,3

68

686,

488

3,63

2,89

9

20,1

93,9

28

3,32

1,06

0

1,16

0,48

2

15,7

12,3

86

180,

591,

968 - - - - - - -

180,

591,

968 - -

180,

591,

968

-

79,4

02,4

98 - - - - - -

79,4

02,4

98 - -

79,4

02,4

98

193,

619,

088

606,

851,

094

7,59

1,12

6

3,49

7,20

5

16,0

11,0

31

1,59

1,99

9

12,9

12,8

64

24,0

04,7

29

854,

990,

805

23,3

14,6

96

6,33

2,23

9

825,

343,

870

93,5

81,9

93

Bal

ance

s at

ban

ks a

nd fi

nanc

ial i

nstit

utio

ns73

,902

,498

45,8

54,2

92

Dep

osits

at b

anks

and

fina

ncia

l ins

titut

ions

5,50

0,00

05,

000,

000

Cred

it fa

cilit

ies:

Indi

vidu

als

112,

552,

975

65,6

31,1

58

Rea

l est

ate

loan

s 12

3,06

8,08

611

5,10

9,89

6

Com

pani

es

Corp

orat

e 28

7,27

2,63

526

2,90

0,43

7

Smal

l and

med

ium

inst

itutio

ns (S

MEs

)

Gov

ernm

ent a

nd p

ublic

sec

tor

15,7

12,3

8611

,062

,777

120,

143,

870

119,

079,

954

24,2

03-

Bon

ds, b

ills

and

debe

ntur

es:

Tota

l on

finan

cial

sta

tem

ent i

tem

s

Tota

l on

finan

cial

sta

tem

ent i

tem

s

Tota

l on

and

off fi

nanc

ial s

tate

men

t ite

ms

Fina

ncia

l ass

ets

at a

mor

tized

cos

t

6,67

1,33

08,

212,

868

Oth

er a

sset

s

Off

fina

ncia

l pos

ition

sta

tem

ent i

tem

s:

Lett

ers

of g

uara

ntee

78

,223

,226

73,7

77,3

85

Lett

ers

of c

redi

t 7,

613,

523

Lett

ers

of a

ccep

tanc

e 8,

438,

672

3,18

6,94

1

Unu

tilis

ed fa

cilit

y lim

its

28,6

34,4

0717

,312

,891

122,

909,

828

108,

039,

058

948,

253,

698

834,

472,

433

To m

itiga

te th

e ab

ove

cred

it ri

sk e

xpos

ures

, the

Ban

k us

es th

e fo

llow

ing

risk

miti

gatin

g fa

ctor

s w

ithin

the

cond

ition

s of

the

cred

it po

licy

set b

y th

e B

ank:

1.Ca

sh c

olla

tera

ls.

2.Ac

cept

ed b

ank

guar

ante

e.3.

Rea

l est

ate

mor

tgag

es.

4.Li

sted

sha

res

colla

tera

ls.

5.Ve

hicl

es a

nd e

quip

men

t mor

tgag

es.

6.Fi

nanc

ial i

nven

tori

es c

olla

tera

ls

2.C

redi

t exp

osur

es a

ccor

ding

to th

e de

gree

of r

isk:

31 D

ecem

ber

2016

Low

ris

k

Acce

ptab

le r

isk

Of w

hich

is d

ue:*

with

in 3

0 da

ys

from

31

to 6

0 da

ys

Wat

ch li

st

Non

-per

form

ing:

Subs

tand

ard

Dou

btfu

l

Bad

deb

t

Tota

l

Less

: Im

pair

men

t

prov

isio

n

Inte

rest

in

susp

ense

Net

-Cr

edit

expo

sure

s (fi

nanc

ial a

sset

s an

d in

vest

men

ts in

fina

ncia

l ass

ets)

are

dis

trib

uted

acc

ordi

ng to

tcr

edit

clas

sific

atio

n as

follo

ws

(AAA

to A

A-)

- 1

3,05

5,16

0

(A+

TO

A-)

10

,321

,525

(BB

B+

TO B

-)

-

16,7

75,4

86

(B

B+

to B

-)

180

,591

,968

10

,325

Less

than

(B-)

not

cla

ssifi

ed-

Not

cla

ssifi

ed-

39

,240

,002

180,

591,

968

79,4

02,4

98

825,

343,

870

726,

433,

375

13,7

61,8

41

An

nual

Rep

ort

34th

-

31 D

ecem

ber

2015

Low

ris

k 3,

115,

952

12,3

447,

690,

456

188,

206

182,

017,

094

-

193

,024

,052

Acce

ptab

le r

isk

61,2

75,2

7311

4,24

9,92

828

4,23

0,94

710

,246

,897

-

50

,854

,292

520,

857,

337

Of w

hich

is d

ue:*

with

in 3

0 da

ys

191,

672

194,

323

8,09

0,81

892

,943

-

-

8,5

69,7

56

from

31

to 6

0 da

ys

71,

437

71,8

244,

830,

117

150,

887

-

-

5,

124,

265

Wat

ch li

st

997,

518

536,

744

5,14

6,49

21,

989,

653

-

-

8,

670,

407

Non

-per

form

ing:

Subs

tand

ard

146,

192

17,1

8830

0,72

51,

339

-

-

46

5,44

4

Dou

btfu

l 65

4,92

627

,464

316,

341

65,2

25

-

1,

063,

956

Bad

deb

t 5,

858,

516

3,14

7,55

320

,122

,594

3,58

2,91

9

-

3

2,71

1,58

2

72,0

48,3

7711

7,99

1,22

131

7,80

7,55

516

,074

,239

182,

017,

094

50,8

54,2

9275

6,79

2,77

8

Less

: Im

pair

men

t

prov

isio

n 4,

416,

993

1,22

0,20

99,

867,

535

3,77

3,10

9

-

-

1

9,27

7,84

6

Inte

rest

in

susp

ense

2,

000,

226

1,66

1,11

66,

181,

862

1,23

8,35

3

-

-

1

1,08

1,55

7

Net

65

,631

,158

115,

109,

896

301,

758,

158

11,0

62,7

7718

2,01

7,09

4

50

,854

,292

726,

433,

375

-Cr

edit

expo

sure

s (fi

nanc

ial a

sset

s an

d in

vest

men

ts in

fina

ncia

l ass

ets)

are

dis

trib

uted

acc

ordi

ng to

tcr

edit

clas

sific

atio

n as

follo

ws

(AAA

to A

A-)

- 5,

507,

713

(A+

TO

A-)

-

11,7

33,3

59

(BB

B+

TO B

-)

- 7,

534,

525

(B

B+

to B

-)

182,

017,

094

18,0

10,3

37

Less

than

(B-)

not

cla

ssifi

ed-

-

N

ot c

lass

ified

-

8,

068,

358

*Th

e w

hole

deb

t bal

ance

bec

omes

due

whe

n on

e of

the

inst

allm

ents

or

inte

rest

is d

ue. M

oreo

ver,

the

over

draf

t acc

ount

bec

omes

due

whe

neve

r it

exce

eds

the

ceili

ng.

Cre

dit e

xpos

ures

incl

ude

cred

it fa

cilit

ies,

bal

ance

s an

d de

posi

ts a

t ban

ks in

add

ition

to fi

nanc

ial a

sset

s.

2016

Guar

ante

es a

gain

st:

Low

ris

k 7,

141,

472

-5,

108,

320

777,

328

13,0

27,1

20

Acce

ptab

le r

isk

59,6

53,6

5411

6,13

3,85

413

7,85

6,36

41,

363,

547

315,

007,

419

wat

ch li

st

--

6,44

2-

6,44

2

Non

-per

form

ing:

Subs

tand

ard

250

-85

,654

-85

,904

Dou

btfu

l 89

1,20

0,25

6-

191,

200,

364

Bad

deb

t 48

7,92

02,

664,

838

4,23

4,06

61,

137,

623

8,52

4,44

7

67,2

83,3

8511

9,99

8,94

814

7,29

0,84

63,

278,

517

337,

851,

696

Of i

t:

Cash

mar

gins

7,

275,

581

52,0

005,

123,

207

777,

328

13,2

28,1

16

Rea

l est

ate

47,2

35,4

5011

9,94

6,94

813

7,74

8,57

91,

450,

000

306,

380,

977

Trad

e st

ocks

6,

073,

742

165

,513

-6,

239,

255

Vehi

cles

and

equ

ipm

ent

6,69

8,61

2 4

,253

,547

1,05

1,18

912

,003

,348

67,2

83,3

8511

9,99

8,94

814

7,29

0,84

63,

278,

517

337,

851,

696

2015

Guar

ante

es a

gain

st:

Low

ris

k 3,

115,

952

12,3

447,

690,

456

188,

206

11,0

06,9

58

Acce

ptab

le r

isk

99,6

56,9

847,

002,

125

wat

ch li

st

482,

547

536,

744

3,02

1,45

41,

222,

547

5,26

3,29

2

Non

-per

form

ing:

Subs

tand

ard

--

97,7

4497

,744

Dou

btfu

l 10

873

,060

809

73,9

77

Bad

deb

t 35

2,00

18,

642,

589

15,0

90,6

391,

706,

942

25,7

92,1

71

42,6

70,6

2110

8,92

1,72

118

7,42

3,31

610

,119

,820

349,

135,

478

Of i

t:

Cash

mar

gins

3,

167,

953

12,3

447,

690,

456

188,

206

Rea

l est

ate

31,6

69,1

4810

8,90

9,37

716

6,54

7,34

29,

024,

560

316,

150,

427

Trad

e st

ocks

5,

214,

568

12,5

47,6

9862

2,78

418

,385

,050

Vehi

cles

and

equ

ipm

ent

2,6

18,9

52 6

37,8

2028

4,27

03,

541,

042

42,6

70,6

2110

8,92

1,72

118

7,42

3,31

610

,119

,820

349,

135,

478

The

follo

win

g ta

ble

brea

ks d

own

the

fair

val

ue o

f col

late

rals

hel

d as

sec

urity

for

cred

it fa

cilit

ies:

Gua

rant

ees

fair

val

ue a

re e

valu

ated

whe

n th

e fa

cilit

ies

are

gran

ted

base

d on

acc

epta

ble

eval

uatio

n m

etho

ds fo

r th

ese

guar

ante

es, i

n th

e su

bseq

uent

per

iods

the

fair

val

ue is

upd

ated

to m

arke

t pri

ces

or

rela

ted

asse

ts p

rice

s.

182,

017,

094

50,8

54,2

92

An

nual

Rep

ort

34th

- - --

- -

20,0

71,9

9220

,071

,992

100,

071,

878

100,

071,

878

-

120,

143,

870

120,

143,

870

Deposits at banks and financial institutions5,500,000- - - - 5,500,000

Direct credit facilities:

Individuals 112,552,975- - - - 112,552,975

Real estate loans 123,068,086- - - - 123,068,086

Companies:

Corporate 287,272,635- - - - 287,272,635

Small and medium institutions 15,712,386-

-

-

-

15,712,386

Government and Public sector24,203 - - 24,203

Bonds, bills and debentures:

Financial assets at amortized cost

Other assets

- - -

Total /the current year 2016 771,967,9618,548,79632,023,51810,32512,785,2538,017825,343,870

679,287,4636,967,20236,163,48610,3353,852,511152,378726,433,375

110,971,8783,477,5425,694,450

Total / comparative figures 2015

4.Credit risk exposure according to geographic area as follows:

Balances at Central Bank of Jordan 80,495,887- - - - 80,495,887

Balances at banks and financial institutions29,698,5815,071,25426,329,06810,32512,785,2538,01773,902,498

*Excluding Middle East Countries.

Res

ched

uled

Loa

ns

Thes

e lo

ans

are

loan

s pr

evio

usly

cla

ssifi

ed a

s no

n-pe

rfor

min

g cr

edit

faci

litie

s bu

t tak

en o

ut th

ere

from

ac

cord

ing

to p

rope

r re

sche

dulin

g. T

hey

have

bee

n cl

assi

fied

as "

debt

s un

der

cont

rol (

wat

ch li

st)"

or

chan

ged

to p

erfo

rmin

g an

d am

ount

ed to

JD

11,

650,

355

as o

f 31

Dec

embe

r 20

16 a

gain

st J

D 2

,182

,339

for

the

year

20

15

Res

truc

ture

d Lo

ans

Res

truc

turi

ng m

eans

rea

rran

ging

cre

dit f

acili

ties

inst

allm

ents

thro

ugh

incr

easi

ng th

eir

dura

tion,

pos

tpon

ing

som

e in

stal

lmen

ts, o

r in

crea

sing

the

grac

e pe

riod

. Res

truc

ture

d de

bts

amou

nted

to J

D 3

1,05

9,83

9 fo

r th

e ye

ar 2

016

agai

nst J

D 3

6,14

7,09

8 fo

r th

e ye

ar 2

015.

Bon

ds, B

ills,

and

Deb

entu

res

The

follo

win

g ta

ble

illus

trat

es th

e cl

assi

ficat

ion

of b

onds

, bill

s, a

nd d

eben

ture

s ac

cord

ing

to e

xter

nal r

atin

g in

stitu

tions

:

-30

,644

,853

30,6

44,8

53

-88

,435

,101

88,4

35,1

01

-11

9,07

9,95

411

9,07

9,95

4

-

-

-

-

- - 120,143,870

6,671,330--- - 6,671,330

An

nual

Rep

ort

34th

-

-

-

-

-

-

-

-

-

Financial assets at amortised cost

Other assets 3,207,344770,0752,693,911- 6,671,330

5.Credit exposure according to economic sectors as follows:

Item

Deposits at banks and financial institutions 5,500,000 - - - - - - 5,500,000

Credit facilities 49,099,34871,677,386179,380,94173,616,717753,69112,531,033151,546,966 538,630,285 24,203

- - - - - 80,495,887 80,495,887

Balance at banks and financial institutions 73,902,498 - - - - - 73,902,498

17,923,916 - 100,071,878 120,143,870

Total / comparative figures

2,148,076- - -

- -

Ope

ratio

nal r

isk

is d

efine

d as

the

risk

of l

oss

resu

lting

from

inad

equa

te o

r fa

iled

proc

esse

s, p

eopl

e an

d sy

stem

s or

from

ext

erna

l eve

nts.

Thi

s de

finiti

on in

clud

es le

gal r

isk.

Inve

stm

ent b

ank

has

impl

emen

ted

a Co

ntro

l and

Ris

k Se

lf-As

sess

men

t pro

cess

for

the

man

agem

ent o

f ope

ratio

nal r

isk

at th

e B

ank

thro

ugh

the

use

of a

n au

tom

ated

sys

tem

nam

ed C

ARE.

Th

e B

ank

man

ages

ope

ratio

nal R

isk

on th

e ba

sis

of th

e fo

llow

ing:

-Pr

epar

atio

n of

ope

ratio

nal r

isk

polic

y.-

Prep

arat

ion

of O

pera

tiona

l Ris

k Ac

coun

tabi

lity

Polic

y an

d ap

prov

ed b

y ba

nk b

oard

of d

irec

tors

.-

Impl

emen

t ris

k pr

ofile

that

det

erm

ine

risk

s an

d th

e m

itiga

ting

cont

rols

for

thes

e ri

sks

for

the

bank

s m

ain

depa

rtm

ents

.-

Impl

emen

t aut

omat

ic s

yste

m fo

r op

erat

ion

risk

man

agem

ent (

CAR

E sy

stem

) to

impl

emen

tse

lf-as

sess

men

t met

hodo

logy

for

risk

s an

d co

ntro

ls p

roce

dure

.-

Bui

ld d

atab

ase

for

risk

s ev

ents

and

ope

ratio

nal e

rror

s.-

Expr

ess

an o

pini

on o

ver

wor

king

pro

cedu

re to

eva

luat

e th

e ri

sks

in it

and

the

adeq

uacy

of t

hese

impl

emen

ted

cont

rol p

roce

dure

s.-

Rep

ortin

g to

the

Boa

rd R

isk

Man

agem

ent C

omm

ittee

and

the

Exec

utiv

e R

isk

Man

agem

ent

Com

mitt

ee w

ith n

eede

d re

port

s.

Com

plia

nce

Ris

k

This

rep

rese

nts

the

risk

s th

at a

rise

from

the

prob

abili

ty th

at th

e B

ank

may

not

com

ply

with

(vio

late

/

tran

sgre

ss) t

he p

reva

iling

law

s, r

egul

atio

ns, i

nstr

uctio

ns, b

anks

law

s, a

nd c

ode

of e

thic

s is

sued

by

inte

rnat

iona

l

and

loca

l reg

ulat

ory

auth

oriti

es.

Com

plia

nce

with

the

regu

latio

ns a

nd p

reva

iling

law

s is

sued

by

the

regu

lato

ry a

utho

ritie

s re

pres

ents

one

of t

he

mos

t im

port

ant r

isks

whi

ch th

e B

ank

mig

ht b

e ex

pose

d to

, due

to th

e m

ajor

fina

ncia

l los

ses

resu

lting

from

the

viol

atio

n of

the

law

s an

d in

stru

ctio

ns th

at a

ffect

the

Ban

k's

repu

tatio

n. M

oreo

ver,

the

past

few

yea

rs w

itnes

sed

man

y ne

w r

egul

atio

ns, i

nstr

uctio

ns a

nd la

ws

orga

nizi

ng th

e w

ork

of th

e va

riou

s in

stitu

tions

. Acc

ordi

ngly

, the

need

for

man

agin

g th

e co

mpl

ianc

e ri

sk o

f the

Ban

k is

nec

essa

ry. M

oreo

ver,

com

plia

nce

enha

nces

the

effic

ienc

y

of m

anag

ing

risk

s an

d de

crea

ses

the

risk

the

Ban

k m

ight

be

expo

sed

to a

s a

resu

lt of

non

com

plia

nce

with

the

prev

ailin

g la

ws

and

inst

ruct

ions

.

An

nual

Rep

ort

34th

-

-

-

- -

-

Total /

C/-1

Inte

rest

Rat

e R

isk:

-Se

nsiti

vity

ana

lysi

s:

31 D

ecem

ber

2016

31 D

ecem

ber

2015

C/-2

For

eign

cur

renc

ies

risk

31 D

ecem

ber

201

31 D

ecem

ber

201

(80,

698)

(9,7

19)

(2,7

14)

868

(20,

341)

80,6

98

9,71

9

2,71

4

(868

)

20,3

41

(14,

205)

687

1,87

1

4,00

8

(58,

197)

(1,8

71)

(687

)

(4,0

08)

58,1

97

14,2

05

(4,6

76)

(10,

020)

(31,

717)

35,5

12

(24,

298)

22,0

32

(6,7

85)

2,16

9

(50,

852)

An

nual

Rep

ort

34th

This

rep

rese

nts

the

risk

res

ultin

g fr

om th

e de

clin

e in

the

fair

val

ue o

f the

inve

stm

ent p

ortf

olio

of t

he s

hare

s

If th

ere

is a

neg

ativ

e ch

ange

in th

e ef

fect

will

be

equa

l with

neg

ativ

e ef

fect

.

due

to th

e ch

ange

s in

the

valu

e of

the

shar

es in

dica

tors

and

the

chan

ge in

the

valu

e of

sha

res

indi

vidu

ally

.

C/-3

Ris

ks o

f Cha

nges

in S

hare

s Pr

ices

:

(25,

476)

(80,

930)

(1,0

31,8

16)

(66,

581)

(123

,500

)

-

(21,

760)

(907

,987

)

(72,

277)

-

Inte

rnat

iona

l Sto

ck

Exch

ange

(106

,060

)(4

8,81

0)In

tern

atio

nal S

tock

Ex

chan

ge

The

Ban

k ad

opts

the

asse

ts-l

iabi

litie

s co

mpa

tibili

ty p

rinc

iple

and

the

suita

bilit

y of

mat

uriti

es to

nar

row

gap

s th

roug

h ca

tego

rizi

ng a

sset

s an

d lia

bilit

ies

into

var

ious

mat

uriti

es o

r pr

ice

revi

ew m

atur

ities

, whi

chev

er a

re

near

er, t

o lo

wer

ris

ks in

inte

rest

rat

es, s

tudy

ing

gaps

in th

e re

late

d in

tere

st r

ates

, and

usi

ng h

edgi

ng p

olic

ies

thro

ugh

the

adop

tion

of a

dvan

ced

finan

cial

inst

rum

ents

suc

h as

der

ivat

ives

.

31 December 2016Assets:Cash and balances at the Central Bank of Jordan 30,700,000 - - - - 60,550,017 91,250,017 Balance at banks and financial institutions 39,990,062 - - - - 29,012,436 73,902,498Deposits at banks and financial institutions - -500,000

- -

5,000,000Financial assets at fair value through statement of income - -

- -

-

5,500,000

50,169,08958,187,09460,563,64474,988,057166,810,632127,911,769 2,128,1162,128,116

Financial assets at fair value through othercomprehensive income

538,630,285 Direct credit facilities – net

Financial assets at amortised cost 6,417,53948,251,907 11,332,533

2,432,9982,432,998

29,625,8628,927,75015,588,279 120,143,870Property and equipment – net - -- -

- - -

- - -

- -

-7,857,886

28,573,60928,573,609Intangible assets - -

- -- -

3,003,4633,003,463Deferred tax assets 6,883,6156,883,615

Other assets 3,311,455 - 51,659,299Total assets LiabilitiesDeposits at banks and financial institutions- - - - - -

- -

- - -- -

- - -

Customers’ deposits Cash margins 38,094,827

Borrowed funds

152,53188,915,807 182,398,911176,163,676 94,000,961 74,419,627 206,248,469949,576,672 127,429,221

139,377,94651,015,51538,801,984 114,495,338 117,499,211177,958,846785,233,458 146,084,618(50,462,139)131,383,396137,361,692 (20,494,377) (43,079,584)28,289,623164,343,214 (18,655,397)

96,992,95421,624,96621,454,230 117,777,372 123,951,123166,330,896690,773,584 142,642,04395,878,855154,280,668129,994,266 73,166,436 69,595,176185,576,648845,419,891 136,927,842

(1,114,099)132,655,702108,540,036 (44,610,936) (54,355,947) 19,245,752154,646,307 (5,714,201)

102,830,96611,398,028 104,677,243 109,727,573153,426,582622,816,743 140,756,3516,753,2717,767,870 5,586,712 5,355,989 4,773,099

30,944,098 29,793,70931,849,617 4,231,383 2,415,649 555,16899,789,624Sundry provisions - -- 710,086710,086

Income tax provision - - - 6,501,4546,501,454Deferred tax liabilities - - - 2,812,8502,812,850

Other liabilities - - - 12,074,87612,074,876Total liabilities Interest rate reporting gap 31 December 2015Total assets Total liabilities

Interest rate reporting gap

4,900,000

24,437,914 24,437,914 - - - - - -

An

nual

Rep

ort

34th

-

-

-

-

-

-

-

-

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2016

Asse

ts

Cash

and

bal

ance

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ank

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ance

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nstit

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787

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01)

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ets

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ilitie

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anks

and

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Con

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Cash

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00,3

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34,3

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242

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1

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22,4

923,

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733

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2,34

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Tota

l ass

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anks

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Re

port

34t

h

(38/

D) L

IQU

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ISK

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t: T

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tabl

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ustr

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e ba

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ning

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riod

to th

e co

ntra

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l mat

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at t

he d

ate

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e fin

anci

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men

ts.

31 D

ecem

ber

2016

Liab

ilitie

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t ban

ksan

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gins

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row

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me

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rred

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liabi

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Less

than

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JDJD

JDJD

JDJD

JDJD

Mor

e th

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m

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up

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Mor

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m

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tere

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tal

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ff fin

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tate

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31 D

ecem

ber

2016

Lett

ers

of c

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t and

acc

epta

nces

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52,1

95 1

6,05

2,19

5

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tiliz

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rant

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938,

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g le

ase

cont

ract

liab

ilitie

s 64

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82,

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tal l

iabi

litie

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31 D

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Lett

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of c

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16,9

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73,

777,

385

Ope

ratin

g le

ase

cont

ract

liab

ilitie

s

Capi

tal l

iabi

litie

s

(39)

S A

NAL

YSIS

a.In

form

atio

n on

the

bank

The

Ban

k is

org

aniz

ed, f

or m

anag

eria

l pur

pose

s, w

hich

mea

sure

d ac

cord

ing

to r

epor

ts u

sed

by g

ener

al

man

ager

and

dec

isio

n m

aker

s to

the

Ban

k in

to th

ree

maj

or

. Mor

eove

r, th

e B

ank

owns

thre

e su

bsid

iari

es: o

ne c

ondu

cts

finan

cial

bro

kera

ge, t

he o

ther

fina

ncia

l lea

se, a

nd th

e th

ird

bond

ed s

tore

s op

erat

ioan

d m

anag

emen

t.

-In

divi

dual

s ac

coun

ts: i

nclu

de fo

llow

ing

up o

n in

divi

dual

cus

tom

ers

acco

unts

, and

gra

ntin

g th

em lo

ans,

cre

dit,

cred

it ca

rds,

and

oth

er s

ervi

ces.

-Co

rpor

ate

acco

unts

: inc

lude

follo

win

g up

on

depo

sits

, cre

dit f

acili

ties,

and

oth

er b

anki

ng s

ervi

ces

rela

ted

tocu

stom

ers.

-Tr

easu

ry: i

nclu

des

prov

idin

g de

alin

g se

rvic

es a

nd m

anag

emen

t of t

he B

ank'

s fu

nds.

Up

to o

ne y

ear

JD

From

one

yea

r to

5 y

ears

Mor

e th

an

5 ye

ars

Tota

l

JDJD

JD

Liqu

idity

ris

k re

pres

ents

the

Ban

k’s

inab

ility

to m

eet o

blig

atio

ns o

n th

eir

mat

urity

dat

es. T

o w

ard

off t

hese

ri

sks,

incl

udin

g th

e m

anag

emen

t of a

sset

s an

d lia

bilit

ies,

mat

chin

g, a

nd a

naly

zing

thei

r m

atur

ities

, mat

chin

g th

e m

atur

ities

, div

ersi

fyin

g so

urce

of f

unds

, and

mai

ntai

ning

an

adeq

uate

fund

of c

ash

and

cash

equ

ival

ents

an

d m

arke

tabl

e se

curi

ties,

liqu

idity

is m

anag

ed a

nd r

evie

wed

per

iodi

cally

at d

iffer

ent l

evel

s,. A

ccor

ding

to

the

Cent

ral B

ank

of J

orda

n in

stru

ctio

ns, t

he B

ank

mai

ntai

ns c

ash

reve

rses

to m

itiga

te li

quid

ity r

isk.

5,36

7,23

75,

621,

908

6,83

8,36

27,

963,

620

8,25

3,92

3-

38,8

24,8

31

2,43

2,61

7

4,41

6,71

4

4,32

0,55

131

,049

,394

3

4,53

4,28

3 36

,160

,774

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9,05

5,38

7

-

710,

086

710,

086

160,

871,

787

81,8

62,1

3244

,414

,697

3,52

2,93

680

0,02

8,60

7

88,9

15,8

0718

2,39

8,91

117

6,16

3,67

611

6,68

6,01

694

9,57

6,67

2

Liab

ilitie

s D

epos

its a

t ban

ksan

d fin

anci

alin

stitu

tions

9,

028,

796

-

-

-

-

-

- 9,

028,

796

Cust

omer

s’ d

epos

its 2

71,4

04,2

57 1

16,8

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391

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4

Cash

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gins

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row

ed fu

nds

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6

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me

tax

prov

isio

n 2,

483,

315

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7

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rred

tax

liabi

litie

s -

-

-

- -

-

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3,43

3

2,07

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3

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er li

abili

ties

3,

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58,

242,

187

-

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-

- 13

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Tota

l lia

bilit

ies

291,

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130

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127

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l ass

ets

206,

620,

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69,5

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7673

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3

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52,

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16

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58,7

22-

46,1

80,5

51

1,08

2,09

01,

082,

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64

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48

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3 69

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6,52

6

95,8

78,8

55 1

54,2

80,6

68 12

9,99

4,26

6 11

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3,70

8 84

5,41

9,89

1

31 D

ecem

ber

201

68

Annu

al R

epor

t 34

th

-

-

-

- - - -

Total liabilities

Gross income 11,151,32322,208,4766,951,7901,938,4471,882,1062,476,321491,06547,099,52839,200,482

524,220379,117--(7,182)(2,110)-894,0453,303,506

------423,239423,239(271,819)

11,675,54322,587,5936,951,7901,938,4471,874,9242,474,211914,30448,416,81242,232,169

---(433,180)(938,958)(1,599,717)(23,066,731)(26,038,586)(21,627,325)

11,675,54322,587,5936,951,7901,505,267935,966874,494(22,152,427)22,378,22620,604,844

---(358,958)(336,161)(209,879)(5,865,969)(6,770,967)(6,295,018)

11,151,32322,587,5936,951,7901,146,309599,805664,615(28,018,396)15,607,25914,309,826

168,382,795310,068,105311,876,81618,938,63060,786,08621,640,269-891,692,701764,388,062

------57,883,97157,883,97181,031,829

168,382,795310,068,105311,876,81618,938,63060,786,08621,640,26957,883,971949,576,672845,419,891

367,661,245294,241,00827,432,998882,58752,102,95816,428,251-758,749,047678,534,506

------26,484,41126,484,41112,239,078

367,661,245294,241,00827,432,998882,58752,102,95816,428,25126,484,411785,233,458690,773,584

2,070,64510,179,232

2,759,899

(Recovery) Sundry provisions

Results of business sector

Undistributed

expenditures on sectors

Profit for the before taxes

Income for the

assets

Undistributed assets on sectors

S liabilities

Capital expenditures

Depreciation and amortization 2,852,149

B-Information on the geographical distribution.The bank conducts its business and operations primarily in Jordan. Accordingly, most of the Bank’s revenues, assets and capital expenditures are inJordan.

Total

Total

a.D

escr

iptio

n of

Cap

ital

Acco

rdin

g to

the

Cent

ral B

ank

of J

orda

n La

w a

nd in

com

plia

nce

with

the

capi

tal a

dequ

acy

requ

irem

ents

, cap

ital

Provision for impairmenton direct credit facilities

cons

ists

of m

any

part

s:

•Ti

er o

ne: P

rim

ary

cons

ist o

f the

ban

ks g

oing

con

cern

, whi

ch in

clud

es:

1-Co

mm

on E

quity

Tie

r 1

2-Ad

ditio

nal p

aid

in c

apita

l Tie

r 1.

•Ti

er tw

o: P

rim

ary

cons

ist o

f the

pai

d in

cap

ital t

hat w

ill b

e us

ed w

hen

goin

g co

ncer

n is

sues

ari

se.

•Fo

r al

l thr

ee ty

pes

of p

aid

in c

apita

l (CE

T1, A

T1,T

2) s

peci

al s

tand

ards

that

the

finan

cial

inst

rum

ent m

ust

mee

t to

be c

lass

ified

in th

e ri

ght .

Addi

tiona

lly, t

he B

ank

com

plie

s w

ith A

rtic

le (6

2) o

f the

Ban

ks L

aw w

hich

req

uire

s th

e B

ank

to a

ppro

pria

te %

10

of it

s ne

t pro

fits

in th

e K

ingd

om a

nd c

ontin

ue to

do

so u

ntil

the

rese

rve

equa

ls th

e B

ank'

s pa

id-u

p ca

pita

l.

b.R

egul

ator

y Au

thor

ities

Req

uire

men

ts C

once

rnin

g Ca

pita

l and

Met

hod

of F

ulfil

ling

Them

.

The

Ban

k co

nsid

ers

the

com

patib

ility

of t

he s

ize

of c

apita

l with

the

natu

re o

f ris

ks it

is e

xpos

ed to

pro

vide

d th

at

paid

-up

capi

tal i

s no

t les

s th

an th

e m

inim

um r

equi

red

by th

e Ce

ntra

l Ban

k of

Jor

dan

and

regu

lato

ry c

apita

l, w

hich

is r

equi

red

to b

e:1-

For

com

mon

equ

ity T

ire

1, n

ot le

ss th

an 6

% o

f the

mar

ket r

isk-

wei

ghte

d as

sets

..2-

For

paid

in c

apita

l, no

t to

be le

ss th

an 7

.5%

of t

he m

arke

t ris

k-w

eigh

ted

asse

ts.

3-Fo

r ca

pita

l ade

quac

y ra

tio n

ot to

be

less

than

12%

of m

arke

t ris

k-w

eigh

ted

asse

ts.

c.H

ow to

Ach

ieve

the

Obj

ectiv

es o

f Cap

ital M

anag

emen

t

The

Ban

k's

man

agem

ent a

ims

at a

chie

ving

the

Ban

k's

capi

tal m

anag

emen

t obj

ectiv

es, a

sur

plus

in o

pera

ting

inco

me

and

reve

nues

, and

the

optim

al u

tiliz

atio

n of

the

avai

labl

e so

urce

s of

fund

s so

as

to r

each

the

targ

eted

gr

owth

in s

hare

hold

ers'

equ

ity th

roug

h th

e in

crea

se in

the

stat

utor

y re

serv

e, r

ecog

nize

d pr

ofits

, vol

unta

ry

rese

rve,

and

ret

aine

d ea

rnin

gs.

The

effe

ct o

f cap

ital a

dequ

acy

ratio

is ta

ken

into

con

side

ratio

ns w

hen

ente

ring

to in

vest

men

ts. M

oreo

ver,

ca

pita

l and

its

adeq

uacy

are

mon

itore

d pe

riod

ical

ly, a

nd c

apita

l ade

quac

y is

cal

cula

ted

by th

e R

isk

Man

agem

ent a

nd C

ompl

ianc

e D

epar

tmen

t.

Capi

tal r

isk

was

cal

cula

ted

base

d on

the

cent

ral b

ank

of J

orda

n re

gula

tions

, whi

ch is

rep

rese

nted

by

Bas

el II

I as

at 3

1 D

ecem

ber

2016

, and

Bas

el II

as

at 3

1 D

ecem

ber

2015

det

erm

inan

ts.

An

nual

Rep

ort

34th

Subs

crib

ed a

nd p

aid-

in c

apita

l

Prim

ary

capi

tal i

tem

s:

Tota

l cap

ital f

or c

omm

on s

tock

s

Mon

itori

ng c

hang

es (d

educ

tions

from

cap

ital)

:

Net

equ

ity

100,

000,

000

Stat

utor

y re

serv

e

Fina

ncia

ls a

sset

s fa

ir v

alue

res

erve

in a

ccor

ding

with

16,2

09,6

48R

etai

ned

earn

ings

(net

of r

estr

icte

d am

ount

s)

5,49

1,51

9

23,5

70,7

71

(3,0

03,4

63)

(6,8

83,6

15)

5,31

1,28

4

810,

256,

182

17.3

6

16.7

1

-

5,31

1,28

4

5,31

1,28

4

140,

696,

144-

145,

271,

938

135,

384,

860

Goo

dwill

or

any

inta

ngib

les

asse

ts

Def

erre

d ta

x as

sets

gen

erat

ed fr

om d

oubt

ful d

ebts

Inve

stm

ents

in th

e ca

pita

l of u

ncon

solid

ated

sub

sidi

arie

s

Tier

II o

f pai

d in

cap

ital:

Gen

eral

ban

king

ris

ks r

eser

ve (n

ot m

ore

than

%1,

25) o

f ris

k w

eigh

ted

asse

ts

Tota

l

Adju

stm

ents

(ded

uctio

ns fo

rm p

aid-

in c

apita

l):

Inve

stm

ents

in th

e ca

pita

l of u

ncon

solid

ated

sub

sidi

arie

s

Net

sup

port

ing

paid

-in

capi

tal (

Tier

II)

Tota

l Cap

ital S

truc

ture

Tota

l ris

k w

eigh

ted

asse

ts

Capi

tal a

dequ

acy

ratio

(%)

Com

mon

sto

ck e

quity

hol

ders

’ rat

io (%

)

Ther

e ar

e no

inve

stm

ent p

ortf

olio

s m

anag

ed b

y th

e B

ank

on b

ehal

f of c

usto

mer

s.

Subs

crib

ed a

nd p

aid-

in c

apita

l

Prim

ary

capi

tal i

tem

s:

Goo

dwill

or

any

inta

ngib

les

asse

ts a

nd d

efer

red

tax

asse

ts

Def

erre

d ta

x as

sets

gen

erat

ed fr

om d

oubt

ful d

ebts

pro

visi

ons

Fina

ncia

l ass

ets

fair

val

ue r

eser

ve in

acc

ordi

ng w

ith IF

RS

100,

000,

000

Stat

utor

y re

serv

e

Less

:

21,3

32,9

48

Ret

aine

d ea

rnin

gs (n

et o

f res

tric

ted

amou

nts)

13

,018

,133

(1,0

65,9

20)

125,

963,

321

18.2

1

17.4

8

131,

228,

079

(1,0

65,9

20)

5,26

4,75

8

720,

548,

304

(7,3

21,8

40)

1,72

7,62

9

4,60

3,04

9

Inve

stm

ents

ded

ucte

d fr

om c

apita

l by

%50

Tota

l pri

mar

y ca

pita

l

Addi

tiona

l Pai

d-in

Cap

ital

Gen

eral

ban

king

ris

ks r

eser

ve

Less

:

Inve

stm

ents

ded

ucte

d fr

om c

apita

l by

%50

Tota

l add

ition

al c

apita

l

Tota

l Cap

ital S

truc

ture

Tota

l ris

k w

eigh

ted

asse

ts

Capi

tal a

dequ

acy

ratio

(%)

Com

mon

sto

ck e

quity

hol

ders

’ rat

io (%

)

d.Th

e am

ount

the

Ban

k co

nsid

ers

as c

apita

l and

cap

ital a

dequ

acy

ratio

are

as

foll

ows:

An

nual

Rep

ort

34th

16.7

1 r

atio

(%)

The

tabl

e be

low

ana

lyse

s fin

anci

al in

stru

men

ts c

arri

ed a

t fai

r va

lue

by th

e va

luat

ion

met

hod.

The

diff

eren

tle

vels

hav

e be

en d

efine

d as

follo

ws

Leve

l 1 -

Quo

ted

(una

djus

ted)

mar

ket p

rice

s in

act

ive

mar

kets

for

iden

tical

fina

ncia

l ass

ets

or li

abili

ties

Leve

l 2 -

Val

uatio

n te

chni

ques

for

whi

ch th

e lo

wes

t lev

el in

put t

hat i

s si

gnifi

cant

to th

e fa

ir v

alue

mea

sure

men

t is

dire

ctly

or

indi

rect

ly o

bser

vabl

e m

arke

t dat

a.

Leve

l 3 -

Val

uatio

n te

chni

ques

for

whi

ch th

e lo

wes

t lev

el in

put t

hat i

s si

gnifi

cant

to th

e fa

ir v

alue

mea

sure

men

t is

unob

serv

able

. The

Ban

k ha

s ap

plie

d bo

ok v

alue

met

hod

whi

ch c

onsi

dere

d th

e be

st a

vaila

ble

met

hod

to m

easu

re fa

ir v

alue

of t

hese

inve

stm

ents

due

to d

ifficu

lty o

f fai

r va

lue

mea

sure

men

t.

The

follo

win

g ta

ble

illus

trat

es th

e an

alys

is o

f ass

ets

and

liabi

litie

s ac

cord

ing

to th

e ex

pect

ed p

erio

d of

thei

r re

cove

rabi

lity

or s

ettle

men

t:

Asse

ts:

Cash

and

bal

ance

s at

the

Cent

ral B

ank

91,2

50,0

17-

91,2

50,0

17

73,9

02,4

98- - -

73,9

02,4

98B

alan

ces

at b

anks

and

fina

ncia

l ins

titut

ions

Dep

osits

at b

anks

and

fina

ncia

l ins

titut

ions

5,50

0,00

05,

500,

000

Fina

ncia

l ass

ets

at fa

ir v

alue

thro

ugh

stat

emen

t of i

ncom

e 2,

128,

116

2,12

8,11

6

243,

907,

884

294,

722,

401

538,

630,

285

Dir

ect c

redi

t fac

ilitie

s -

net

Fina

ncia

l ass

ets

at fa

ir v

alue

thro

ugh

othe

r

com

preh

ensi

ve in

com

e -

24,4

37,9

1424

,437

,914

56,3

03,6

8463

,840

,186

120,

143,

870

2,04

5,12

326

,528

,486

530,

127

2,47

3,33

6

28,5

73,6

09

Fina

ncia

l ass

ets

at a

mor

tized

cos

t

Prop

erty

and

pla

nt -

net

Inta

ngib

le a

sset

s 3,

003,

463

378,

258

6,50

5,35

76,

883,

615

8,85

9,58

646

,263

,699

55,1

23,2

85

2,43

2,99

8-

583,

968,

845

38,8

47,8

98

2,43

2,99

8

484,

805,

293

464,

771,

379

949,

576,

672

Def

erre

d ta

x as

sets

Oth

er a

sset

s

Tota

l ass

ets

Liab

ilitie

s:

Dep

osits

at b

anks

and

fina

ncia

l ins

titut

ions

Cust

omer

s’ d

epos

its

622,

816,

743

15,6

25,7

5638

,094

,827

Cash

mar

gins

22

,469

,071

62,7

93,7

1599

,789

,624

36,9

95,9

09

710,

086

-

Bor

row

ed fu

nds

Sund

ry p

rovi

sion

s

710,

086

-6,

501,

454

Inco

me

tax

prov

isio

n 6,

501,

454

2,81

2,85

02,

812,

850

-12

,074

,876

120,

790,

305

785,

233,

458

-D

efer

red

tax

liabi

litie

s

Oth

er li

abili

ties

12

,074

,876

664,

443,

153

343,

981,

074

164,

343,

214

(179

,637

,860

)

Tota

l Lia

bilit

ies

Net

31 D

ecem

ber

2016

Asse

ts:

Cash

and

bal

ance

s at

the

Cent

ral B

ank

102,

527,

791

-10

2,52

7,79

1

45,8

54,2

92-

-

-

45,8

54,2

92B

alan

ces

at b

anks

and

fina

ncia

l ins

titut

ions

Dep

osits

at b

anks

and

fina

ncia

l ins

titut

ions

5,00

0,00

05,

000,

000

Fina

ncia

l ass

ets

at fa

ir v

alue

thro

ugh

stat

emen

t of i

ncom

e 2,

556,

397

2,55

6,39

7

222,

874,

925

231,

829,

343

454,

704,

268

Dir

ect c

redi

t fac

ilitie

s -

net

Fina

ncia

l ass

ets

at fa

ir v

alue

thro

ugh

othe

r

com

preh

ensi

ve in

com

e -

20,5

81,4

6120

,581

,461

71,6

34,3

6347

,445

,591

119,

079,

954

1,80

6,40

526

,921

,345

621,

939

1,33

3,98

6

28,7

27,7

50

Fina

ncia

l ass

ets

at a

mor

tized

cos

t

Prop

erty

and

pla

nt -

net

Inta

ngib

le a

sset

s 1,

955,

925

330,

360

5,03

5,55

55,

365,

915

5,51

4,60

853

,551

,530

59,0

66,1

38

9,01

8,27

5-

583,

892,

917

183,

438

9,01

8,27

5

453,

721,

080

391,

698,

811

845,

419,

891

Def

erre

d ta

x as

sets

Oth

er a

sset

s

Tota

l ass

ets

Liab

ilitie

s:

Dep

osits

at b

anks

and

fina

ncia

l ins

titut

ions

Cust

omer

s’ d

epos

its

584,

076,

355

-32

,157

,407

Cash

mar

gins

32

,157

,407

30,3

51,9

6442

,322

,037

11,9

70,0

73

1,08

2,09

0-

Bor

row

ed fu

nds

Sund

ry p

rovi

sion

s

1,08

2,09

0

-6,

208,

287

Inco

me

tax

prov

isio

n 6,

208,

287

2,07

3,43

32,

073,

433

-13

,835

,700

33,6

90,9

2569

0,77

3,58

4

-D

efer

red

tax

liabi

litie

s

Oth

er li

abili

ties

13

,835

,700

657,

082,

659

358,

007,

886

154,

646,

307

(203

,361

,579

)

Tota

l Lia

bilit

ies

Net

31 D

ecem

ber

2015

An

nual

Rep

ort

34th

A .

B .

C .

2016

Fina

ncia

l ass

ets

thro

ugh

stat

emen

t

of in

com

e 1,

944,

323

2,12

8,11

6

183,

793

Fina

ncia

l ass

ets

thro

ugh

othe

r co

mpr

ehen

sive

inco

me

21,8

51,6

3324

,437

,914

26,5

66,0

30

2,5

86,2

81

23,7

95,9

56 2

,770

,074

2,55

6,39

7-

2,55

6,39

7-

18,3

02,2

3520

,581

,461

23,1

37,8

58

2,2

79,2

26

20,8

58,6

32 2

,279

,226

2015

Fina

ncia

l ass

ets

thro

ugh

stat

emen

t

of in

com

e Fi

nanc

ial a

sset

s th

roug

h ot

her

com

preh

ensi

ve in

com

e

A.Cr

edit

com

mitm

ents

and

con

tinge

ncie

s:

Lett

ers

of c

redi

t 7,

613,

523

13

,761

,841

8,43

8,67

23,

186,

941

26,0

75,7

4431

,800

,034

39,7

77,0

8830

,842

,045

12,3

70,3

9411

,135

,306

28,6

34,4

0717

,312

,891

122,

909,

828

108,

039,

058

804

28,5

80

11,0

0016

7,10

4

11,8

0419

5,68

4

Acce

ptan

ces

and

peri

odic

with

draw

als

Lett

ers

of g

uara

ntee

s:

Paym

ents

Perf

orm

ance

Oth

er

Unu

tiliz

ed c

redi

t fac

ilitie

s

B.C

ontr

actu

al o

blig

atio

ns:

Cont

ract

s to

pur

chas

e pr

oper

ty a

nd e

quip

men

t

Cons

truc

tion

cont

ract

s

Ope

ratin

g le

ases

am

ount

ed to

JD

642

,728

3

1 D

ecem

ber

201

)

The

fair

val

ue o

f the

unq

uote

d fin

anci

al in

stru

men

ts p

rese

nted

in th

e co

nsol

idat

ed fi

nanc

ial p

ositi

on a

re n

ot

mat

eria

lly d

iffer

ent f

rom

thei

r ca

rryi

ng v

alue

in th

e co

nsol

idat

ed fi

nanc

ial s

tate

men

ts. I

n ad

ditio

n, th

e fa

ir

valu

e of

dir

ect c

redi

t fac

ilitie

s, d

epos

its in

ban

ks a

nd fi

nanc

ial i

nstit

utio

n, c

usto

mer

dep

osits

, cas

h m

argi

n an

d bo

rrow

ed m

oney

whi

ch p

rese

nted

at a

mor

tized

cos

t are

not

e m

ater

ially

diff

eren

t fro

m th

eir

carr

ying

va

lue

pres

ente

d in

the

cons

olid

ated

fina

ncia

l sta

tem

ents

bec

ause

the

inte

rest

rat

e in

the

finan

cial

ass

ets

mar

ket a

re n

ot m

ater

ially

diff

eren

t fro

m th

eir

cont

ract

ual p

rice

s, fu

rthe

rmor

e, d

ue to

the

shor

t ter

m p

erio

ds

whe

n it

com

es to

dep

osits

at b

anks

and

fina

ncia

l ins

titut

ion.

The

fair

val

ue p

rese

nted

at a

mor

tized

cos

t is

mea

sure

d ei

ther

thro

ugh

pric

es a

nnou

nced

in th

e m

arke

t whe

n it

is a

vaila

ble

or th

roug

h va

luat

ion

met

hods

su

ch a

s us

ed in

som

e bo

nds

with

fixe

d in

tere

st r

ate

case

s.

Dur

ing

the

first

qua

rter

of 2

015,

the

bank

tran

sfer

red

part

of t

he fi

nanc

ial a

sset

s at

fair

val

ue th

roug

h pr

ofit

and

loss

to fi

nanc

ial a

sset

s at

am

ortiz

ed c

ost,

whi

ch c

ompl

y w

ith th

e lo

ng te

rm s

trat

egic

inve

stm

ent p

lan

and

inve

stm

ent d

rive

n of

thes

e in

vest

men

ts. T

he fa

ir v

alue

of t

he p

ortf

olio

at t

he tr

ansf

erri

ng d

ate

amou

nted

to

JD

2,3

60,1

36 a

nd th

e fa

ir v

alue

as

of 3

1 D

ecem

ber

2016

am

ount

ed to

JD

450

,939

.

An

nual

Rep

ort

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ib-annual report 2016 signature (1) - investbank · 2018-05-29 · raouf abu jaber &sons co....

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