Bank Alfalah Limited ($BAFL)

Hello, everyone, and welcome to the corporate briefing session of Bank Alfalah for the year ended 2025. I'm Syed Akbar Ali, Head of Capital Markets and Investor Relations for Bank Alfalah, and will be moderating today's session. Today, we are joined by the senior leadership of the bank to highlight bank achievement during 2025 and the way forward. I'm pleased to welcome Atif Bajwa, President and CEO of the bank; Ms. Anjum Hai, Chief Financial Officer; and Mr. Pervez Shahbaz Khan, Group Head Global Markets and Treasury. Firstly, you would have a welcome from our President, followed by a detailed presentation by CFO, after which we'll open the floor for Q&A. [Operator Instructions] With this, I'll just request sir, Atif Bajwa for his welcome[indiscernible].

[Foreign Language] Good afternoon to everyone. It's a pleasure to have you all join us in this call. And hopefully, we'll be able to give you a good briefing on the achievements of Bank Alfalah and an outlook for the near-term future. It's the first time that -- in a long time that I have personally also joined this corporate briefing, and it's a pleasure to do so. And I look forward to having a conversation and possibly answering some of your questions. But in the meantime, I would request Ms. Anjum Hai, our CFO, to please take us through the presentation that has been prepared for your benefit. Thank you.

Everyone can we have the first slide, please? Okay. So I will be starting with the first slide where we have an overview of the bank. So basically, we are a AAA-rated commercial bank. We are majority shareholding in Corp and Abu Dhabi Group. We operate out of 245 cities through 1,186 branches. We have presence in 4 countries abroad. Our CAR is 15.87%. Recently, our market cap has increased to PKR 170 billion. So if. You go to the next slide, there we are looking at our operating units. So basically, 6 key operating units and under each, we have a very comprehensive product suite. So very diversified product portfolio. We do SME, agri, consumer banking. We are into acquiring business. We have a very comprehensive and strong digital arm. Our investment banking division, which operates under corporate is a very strong one with -- along with treasury. We'll talk about more in the subsequent slide for each of these. So our next slide is here, we're looking at the digital touch points. So we have over 110,000 touch points. This includes branches and our digital network. So here, we are looking at ATMs, CDMs, our e-commerce merchants and digitally enabled merchants. We are serving around 9.4 million customers. Our debit card portfolio stands at 3.8 million and our credit card book is around 469,000. Moving on, the next slide shows the growth trajectory of the bank for the for the last 5 years, the slide has disappeared. Can they still see it. Should I carry on, would they be able to see it? Sorry about the disruption, just give us a minute, we're just trying to get slide back online. Okay. Sorry about that. So here on this slide, we are looking at our growth trajectory over the last 5 years. So I'll talk about deposits first. So CAGR for our deposits over the last 5 years has been 23% and in 2024, towards the end of 2024, there was a strategic shift in our strategy, whereby we started to focus more on averages and you only [indiscernible] average, and we moved away from chasing end-of-period deposits. But despite that, during the -- during 2025, we have increased the deposit book by 16.8%. When we look at gross advances, our CAGR has been 13.8%. And this is a factor of basically the credit environment in which we operate. When we look at the numbers for '22,'23, it was a very high interest rate regime at that time. And hence, the demand was quite sluggish. In 2024, there was aggressive growth in advances, and there was a factor of the ADR-led taxation, which impacted the strategies of all banks in the industry. And some of the lending undertaken at that time were not on very favorable terms. But that situation has now normalized in 2025. And if we exclude the impact of ADR tax, then our growth in 2025 was actually 30% -- over 30%. Looking at trade, again, our CAGR has been 13%. This is on the back of mainly import led growth. Investment is a factor of, firstly, surplus liquidity and our treasury strategy, sometimes the borrower to place based on the interest rate view. Our investment book at December end is actually more skewed towards T-bills and VIB floaters. So quite well positioned for this year. We move on to the next slide where we are looking at the deposit details. So our market share for deposits at cutoff was 6.2% for current deposits [indiscernible] plus 5.9% and our car mix stood at 38%. As I said, that we've been focusing more on average. So our average CAR notes during 2025 was 21%. And if you look at the split of the Islamic average grew by 33%, while the conventional retail grew by 23%. So quite significant growth there. Moving on, the next slide talks about advances. So our advances market share at cut off was 7.4%. The average growth in advances was 22%. If you look at the segments, then our SME and Agri grew by 33%, and the market share for SME was 8.1% and for agri was 4.7%. For consumer lending, we continue to be the -- amongst the top 2 banks in the market, and the portfolio grew by 43%. And for auto loans and home loans, we are the leader while for credit card and personal loans, we are #2. The next slide. Here we're looking at trade volumes and remittances. Again, we see growth trajectory. So trade volume, 20% up versus last year. And on the back of that, our market shares increased to 9.6%. For remittances, the volumes increased by 8.7%, and our market share is now at 14.7%. On the back of these volumes, our FX income has also increased by 25% over last year. Next slide just shows us the -- our overseas footprint. So we operate in 4 countries abroad, but 2 of these are in sales mode. And going forward, we intend to focus more on our core geographies, which are UAE and [indiscernible]. The slide shows the size of the deposits and advances in these overseas jurisdictions, which is basically $162 billion in deposits and $54 million in net advances. If you move on and we look at [indiscernible] highlighting the digital proposition here. So firstly, what I'd like to highlight that we have been awarded the Best Digital Bank award 4 years in a row by PBA. And that's basically a recognition of our -- the strength of our platform and something which we are very proud of. So digital throughput has increased by -- has increased by 64% to PKR 18.3 trillion, and a significant part of it PKR 7 trillion of this comes through our alfa app. And our alfa app volumes grew significantly and our users also the 30-day actives, which we monitor have grown to 1.3 million. Our digital migration ratio has increased to 90%. And if you look at all the rest of the channels there, we see growth across all like digital payments, digital lending, everything shows a very strong growth versus last year. Move on to our next slide, there we have a snapshot of the balance sheet. I've already discussed these items, so I'll move on to the P&L. So our profit after tax for the year was PKR 28 billion. And there were a couple of themes, which I would like to highlight here. Firstly, of course, versus 2024, the interest rates were lower by 8.3% on average. So that resulted in spread compression during the period, which we managed to make up through growth in card averages and then also our treasury strategy paid off because towards end of 2024, our treasury built positions in long-term bonds, which realized dividend capital gains for us and supported NII when there was spread compression. And noninterest income, all lines were up except for fee commission, where there are 2 factors impacting them. Firstly, the decline in the home remittence commission income, that's down because of the change in the SPP pricing for remittence and the second one was the BISP fee, which was down because, again, the contractual terms for that contract was revised, and now it's more NII-driven product. So as a result, our total income is up by 7%. Our admin expenses are up 38%. And the key component here is the home remittence market fee. Again, linked to the change in SVP pricing regime. If we exclude that, then the admin expenses actually increased by 26%, and that's on the back of increase in our branch network. Of course, the branches which we opened in 2024 also are having the full year impact this year. Then there are, of course, increments hiring and certain lines which were impacted because there were price hikes way above the prevailing inflation. For example, the SMS cost. So quite a few factors putting pressure on costs there. Provisions also up versus last year. The key factor there was subjective provisioning, which the bank took in line with our conservative stance on provisioning, which we follow. Okay. The next slide here just highlights the key ratios for us. I'll just pinpoint a couple. So when we look at spreads, we see that we've maintained our spread all through the year. And this is a result of our strategy on deposits, whereby we've been pursuing current account and averages. So you -- we can see that we've managed to increase our spreads. The other 2 ratios I would want to highlight here are the NPL ratio, which is 4.1%, which is a very healthy, which is very low and coverage is 102%, which gives us a comfort on the provisioning on the portfolio. So moving on. Okay, this slide talks about our CSR initiatives. So during the period, bank gave donations of $300 million and also another $187 million through our Islamic charity. And another thing to highlight here is that we have pledged another $5 million towards the victims and the communities impacted by flood. This is on top of the $10 million, which we pledged for the flood relies in 2022. The -- the slide on the right shows where all this donation has gone to support like education, environment and health care, et cetera. Next slide talks about recognitions. I think that -- moving on, I just want to highlight the risks. So these are some of the BAU risks which a bank undertakes in our day-to-day banking activity. And I just want to -- again, these are the -- as a routine we undergo we have a very strong risk management department, which oversees this risk. We have policies and procedures around managing and mitigating these risks. So these are considered very BAU in a bank and quite normalized. However, the next slide highlights some of the headwinds which we are presently facing because of the present scenario. And right now, it's premature to talk about this, there are quite a few headwinds there. But actually, the ultimate outcome of this would really -- and the impact on the sector and the banking, which actually depends upon how long this war lasts. But just for the information as the possible headwind. I think that concludes my presentation. If there are any questions, we could take them.

[Operator Instructions]

I'm from MTP Investment. Sir, my first question is regarding the marketing, advertisement and publicity cost. Recently, the cost spiked to around PKR 5.3 billion in the June quarter. But recently, we had normalized to around PKR 1.5 million, the marketing and advertisement cost. So is this the new level? And can you give a general idea of what the operating expenses are expected next year? There were certain one-offs in the last year, so can we expect this to normalize in the next year.

I think you're right that this started normalizing. And the expectation for this year is that this particular head of expenses, which is marketing for remittances, will come down to between -- on an annual basis, between PKR 4.5 billion to PKR 5 billion, which is a considerable reduction from last year, which we know there are reasons for. But this year, that -- this item is going to be normalized. And of course, not fully taking into account the inflationary impact that we are likely to see as a result of the Iran situation. I think we would have seen a more increase in other costs.

Including other cost you are saying that around PKR 4.5 billion or PKR 5 billion are one-off, we won't see in this year.

So in that head, which was marketing for remittances, which had gone up to about PKR 13 billion last year. We are anticipating that had to be between PKR 4.5 billion to PKR 5 billion.

Okay. Sir, my next question is that can you give an idea of your exposure in the Middle East, obviously, with the current situation in the Middle East, there are a concern for NPL. So what is the actual exposure in the Dubai NY region of advances and investments?

Advances, we do have advances in Dubai, but the primary export there is in bonds. And that is something that we feel we have adequate coverage. You want to add something regarding the bonds?

Yes. In international operations, we are mostly concentrated in investment-grade bonds. So in terms of credit, I think we are reasonably comfortable because there has not been much movement in credit bonds, which are investment grade.

The next question is from [indiscernible]

So I just wanted to understand your interest income has declined significantly. But your net interest margin seems to have gone up. How -- could you just shed light on how is this managed?

Interest income, if you look at the net interest income, our numbers...

Sorry, there's a significant decline in gross interest income, right?

Gross -- so gross lines, basically both the yield and the markup are go down because of the fact -- because of the reduction in interest rates.

Yes, that I understand. But your margins still have increased. Your net interest margin has still increased.

We maintain the margin.

We've managed to maintain the margin because of our efforts and the way we have structured the portfolio mix, but why you see the decline in gross lines is basically just because of the decline in interest rates. Net the spread is the same. Actually better.

Yes, that's what I was saying that the spread is better, but the gross amount has declined significantly. So I guess you did a good job here.

Thank you very much.

Next question comes from the line of [indiscernible] Haider.

Sir, my question is regarding compensation. The bank is paying PKR 49 billion and compensation whereas other banks which have more branches and more number of staff members, they are paying way less. So can you please tell me what your reason because bank seems to be very generous, which is good, but that compensation should translate into profits, which still are declining and the decline is, I think, the highest in the industry. If we compare the results in 2024 -- 2025 results are far more like they're not in line with the industry. So can you please explain why bank is spending so much money on admin expenses?

Your question has 2 parts. So let me first look at the compensation piece. So see we have competitive compensation. We are very much in line with the market. The conversation is a factor of, of course, the complexity of the bank and the scale. So you see when you compare us to the banks of our size and complexity you see that our compensation is in line with those banks. And again, in this market to attract talent, you have to compensate them accordingly. In terms of our headcount as well, we are very much in line with those banks. And I'm not sure it really depends on which one you're looking at. So to compare [indiscernible] look at banks in the market who have the same offering, for example, digital consumer, all of those things add to the complexity of the job and, of course, the human resource attached to it. Now regarding the fact that why our profitability is down, the key factor for that, which I explained in my narrative was a plant that we were impacted because of the home remittance marketing. Now why we were impacted more is the fact that, firstly, Alfalah was the second largest player in the home remittence domain. And the change in the pricing structure by Central Bank, this was something which happened towards end of 2024. So -- it -- the new structure favored banks with lower market share in remittance space. And of course, to be able to maintain those flows because those flows are critical for our trade activities and other banking activities. So we had to spend a little bit more. And this is -- you see that impact in our profitability. But now the situation has normalized. And going forward, we expect that, that debt is not going to impact us going forward. Does that answer your question?

Yes. But I have another question regarding dividends. Can you please tell us what is the dividend policy going forward? [indiscernible] then going to maintain the payout ratio? And further, how do you see your profitability going forward? Is it going to be at the same level or you see some improvement in the overall profitability, net profit.

So 2 parts. First, the dividend side and the policy is to be considered a safe pair of hands. So consistent payout over the years and to increase gradually as our profitability hopefully improves over the years. So we are -- if you have seen our performance over the last few years, then we've generally kept it reasonably stable for the first 3 quarters. And in the fourth quarter, based on the the final profitability, we've been able to increase the last quarter. And we expect that a similar policy will continue in terms of the expectations for profitability for 2026. We're looking at a reasonably good year. However, as you would expect that we are seeing some uncertainty coming up in the next few months. And that will really determine how the final numbers stack up towards the last few quarters. But far so good.

Next question comes from the line of Fahad [indiscernible]

So my question also pertains to the prevalent situation. And right now, what we're seeing in the secondary market is that yields are slightly up, and there is a lot of talk surrounding increase in interest rates. What we saw in the past was that when the interest rates were on the up, there was -- a the deposits -- the industry deposits shot up significantly. Are we expecting something like that? I know it's a fluid situation. But given the current situation, what is the deposit outlook like right now? That's my first question.

Given the circumstances, a number of factors will be affecting deposit growth. First, of course, we always plan to see as an indicator, money, supply, growth. And as you rightly said, last year, the deposits -- overall deposits grew quite sharply in fact, even beyond money supply growth. So that was -- I think the growth numbers were in excess of what we would have anticipated based on money, supply, growth. But this year, we're not anticipating any significant delta again However, the other factors that are affecting deposits will be how the general public reacts to this uncertainty. Will there be desire to move deposits into cash. That's something we are watching. We haven't seen anything big so far. But of course, you know that uncertainty then drives that kind of behavior where cash is preferred. So far, nothing, but we're watching that space. Also level of business activity could get affected. And that will also impact the deposit numbers in banks. So just you and us are both watching the space.

Right. And my second question is pertaining to the investment book. Now we all know that the bank acted ahead of the curve, while positioning itself post September and they cut out and reduced the borrowing as well. But there was a significant buildup in investments in the last quarter despite the borrowing going down. So what kind of a position is the book at right now? Our intelligence suggests that there are no headwinds expected even at the interest rate were up on the investment book.

Thank you for the question. I'll ask Mr. Pervez to answer that question for us who is the Head of Treasury.

Okay. So on the investment side, you're absolutely correct. We did position ourselves in the last quarter because there was an expectation that interest rate will be cut. So we accordingly managed to increase our overall investment book primarily in T-bills. Secondly, the corresponding borrowing through open market operation was reduced because in the last quarter of 2025, we saw a huge inflow of deposits. So most of the borrowings were offset through the deposit.

And sir, important -- I know this is just -- you don't have to answer this side. But given what's happened and more importantly, from the treasury front, what is your expectation on the rates, if you...

Okay. So Okay, sure. So our expectation is we believe that the interest rates have already bottomed out. We were already expecting it earlier before this U.S. Iran conflict started. So this conflict has actually aggravated the overall situation. And we earlier believe that there could be an interest rate hike at the end of this year, but maybe we might see that hike earlier than that.

Next question comes from the line of [indiscernible] Khan.

So I have a couple of questions. Number 1 is that, I mean, you guys mentioned in the digital footprint, I think, around 9-plus million customer base. So how many of them are non-GP sorry, how many of -- either non-GP or GP? The second part that I was -- interested in this broader umbrella of digitization. So Alfalah is obviously, one of the -- probably the only bank with a digital banking group with segment-wise numbers. You guys mentioned that the digital lending is around PKR 97 million. Is that disbursement annual or the outstanding book? Because if you're talking about the outstanding book, the digital side asset -- digital segments asset side is like roughly PKR 18 million, if I'm not mistaken. That's 2. Number 3 is -- or I mean, we can -- I can add once you answer as well, whatever is easier.

So the first part was how many of these are G2P customers. So that would be 3.5 million is of the 9 million number.

Okay. 3.5 million.

G2P, I'm saying is a -- non-G2P is 3.5 million, sorry, it is the other way around.

Okay.

And the second one, could you repeat regarding the lending?

So I think the presentation in slide -- in one of the slides mentions PKR 97 billion book of digital lending, right? PKR 97 billion for digital lending. I'm wondering if that is the disbursement and the outstanding book.

Disbursement.

And what number would it be for outstanding.

We could get back to you on -- with that number. It is going to be less than that.

Okay. And the second part of this question is, obviously, Alfalah, we've seen the on the consumer side, whether it's cards, whether it's the acquiring business, Alfalah has been ahead of the curve for a long time. But in terms of cost to income, it still doesn't perform as with. So my question is, why is that considering that now the branch transactions are now also channeling owards digital channels, CDM, it's way ahead of the curve and CDM numbers are doing well overall as well. So why is the cost to -- by that progress is not reflected in cost to income. And the same for fee total income. The ratio is relatively lower even though Alfalah has a great footprint in most fee income categories.

Okay. So number one, regarding your question on cost of income. So 2 factors here. Number one, firstly, of course, primarily it's the home remittance marketing. If we were to exclude home remittence marketing, the cost to income for the bank for last year would be around 56%. So that's like the normalized level. And also to understand the cost to income for a bank like Alfalah, you need to understand our -- the products we offer and the segments we operate in. So because we are a major retail bank operating a significantly large consumer segment and of course, a digital proposition where we continue to invest. So when we look at a bank of our texture, the normalized cost to income is always around this range of 50% to 55% because retail banks have that texture while corporate banks usually have a lower cost-to-income operating level. So you need to be mindful of that in the comparison when you compare to with other banks. Regarding fee, there were two -- see, if you look at my income note, you will see that all lines are up, there are 2 lines, which impacted fee more. So if you were to utilize the impact of those 2 lines, the fee actually is up by around 12%. And those 2 lines will be, again, one is home remittence business commission and the other one is the BISP commission, where again, both were impacted because the pricing change for these -- so those are the 2 factors there impacting.

One final question on like a very -- so you guys have mentioned the throughput side, if I'm not -- I'm not sure if I'm able to see the volume side of the key channels, right? So alfa, POS and so on. And the second part is that, if I'm not mistaken, the POS and card and e-commerce business numbers in the digital slide referred to the acquiring side. I'm wondering what the uptake is from the issuing side.

Okay. So just for clarity, the volumes which we churn through -- if I'm understanding your question right so it will be...

The number of transactions [indiscernible] PKR 7 trillion is...

Number of transactions -- yes, we don't. We are not reflecting. We can't share that. But again, I think you can take the volume as a proxy...

The second part [indiscernible] if that can be shared, it will be perfect because just to get a sense of what the average transaction size looks like compared to the industry average, so that would be helpful. But the second part would be the, I guess, the PKR 470 million is the cost acquiring throughput. Similarly, I mean, I'm not sure, actually. So if you can just give a sense of the acquiring versus issued numbers in this smaller bit of the pie chart?

Okay. So I think we'll have to get back to you with those numbers. Also see the issuing part of the claim for credit card terms under slide, just to give you a texture, it comes under Slide 7, where you're showing the new cards issued and the volumes outstanding. It does not highlight the fee income on the throughput, but it gives you -- that's how we look at credit cards regarding how much -- how many we acquired and how -- what's the end of period...

That's financing side, right? That's not the spend side and...

So just -- since we don't have what is directing you [indiscernible] but we can get.

Next question is from Aram Ahmed.

This is Aram from [indiscernible] Limited. My first question was regarding the deposit strategy. The presentation noted that the CAR ratio currently stands at 38.2%, unchanged from last year. And the CASA actually declined from 77% to 69%. Regarding my first question, how do we expect the current account ratio to evolve in the years going forward as the bank continues to target low cost deposits. We've seen in other banks as well, the target CAR ratio of around 40% to 50%. And secondly, what what exactly is the reason and the decline of the CASA ratio? Because if the current account ratio has been -- remained constant, so that probably means that the savings ratio has declined. And my third question is, I don't know if this has already been covered, but what is the bank's PIB book split? So what percentage of the PIB has been invested in fixed rate instruments and what has been invested in floating rate instruments.

Okay. So one at a time and remind me if I've missed something. So firstly, CASA. Now CASA, yes, you're right. At year end, the CASA ratio went down. Actually, that was something of a customer-led activity because our term deposits went up. It's not something which you were very actively soliciting, but I can just highlight that these were normal BAU term deposits on normal pricing and a good spread. So and that's something which has impacted us at cutoff, but it's not causing us a [indiscernible] on the bottom line.

[indiscernible] Average versus period ending. We don't chase period end.

Yes. We don't chase period end as well.

Just to clarify that, there is an impact because we've changed our strategy. We don't chase period-end numbers for current account deposits. We chase averages for the month. So the consequence of that is that at the period end, we don't have those spikes that for one day, current account goes up, for the month end or period end and then drops the next day. So we've done away with most of that practice. And therefore, the impact is that the current account at least on period end seems to be lower than it was in competitive periods in the previous years.

So regarding your direction on how we foresee the CAR mix to be going forward? It should hover around the same rate and actually improved slightly. But as Atif highlighted, that we are pursuing not a cutoff number, but averages. So we cannot give you a very hard fast number because the numbers that you see here are cut-off driven. But in terms of averages, we will continue to pursue average current accounts and profitable deposits wherever we have a positive spread. Regarding PIB, I will ask Pervez to take that part of the question.

Okay. So you -- I think you asked about the mix of fixed rate bonds versus the floating. So in our overall investment book, the -- primarily the PKR investment book, we have around 27%, which is is PIB and some portion of fixed rate FRR, which is the fixed rate Sukuk. So that's 27% of our portfolio. 33% is T-bills and the rest 40% is either floating rate PIBs or there's some portion on our Islamic balance sheet, which is the VR, the variable rate Sukuk.

Next question is from [indiscernible] .

[Foreign Language] Is expected to be covered and it's going to be as profitable as it was before this price...

No. Unfortunately, it will not be going back to the levels of 2024 and earlier. I think there is -- of course, the government has reduced the rebates that are offered for remittances. And also, there has been an understanding to reduce the the level of marketing spend that's going to be incurred by each bank that is an MOU. So it will be less than last year, but it will be higher than 2024. So when we say normalized, it's really a new normal, but much better than last year because last year was crazy.

[Foreign Language]

[Foreign Language]

Sorry, we cannot give you those specific numbers, but we can say that they will -- it's going to go down significantly.

On the digital banking side, you guys have your own development arm, which is why the cost on that side is elevated. If you can give some sort of color on that, please?

So it's not just the system. Of course, there are separate systems which house our digital offerings, but it's also the team around it, which is sort of developing those products and marketing and selling them. So it's the whole infrastructure around the digital, which adds to this cost.

But to your point, I think it's -- yes, there is a development team, which we believe is larger than other banks. And I think that is what gives us that competitive edge in being able to constantly produce value-added products and stay ahead of the market. And a lot of this investment that is being made in new product development is expected to give us the returns in the coming years. So we are still in an investment phase where we're continuously improving our product set on the digital side, covering more segments and a broader range of products.

[Foreign Language] products, are these lending products? Are these investment products for the customers, [Foreign Language] any sort of interesting things you guys are working on?

So yes, they're all over this slide that we are going to put up to just remind you a little bit on that. So there are, of course, payment applications. What we're trying to do is capture as many payments that go through the economy in our digital systems. And that's our target, and that's where you see that the throughput is rising quite rapidly. Just in digital payments, you can see that there's been a growth of 106% year-on-year. Once you capture the payments going through digital systems, then you better understand who is making those payments, under what terms and whether they need credit also to support their businesses, and that's where you see the digital lending side come in then. So we develop credit scoring methodologies, which help us lend in a safer way. And so digital lending has been growing also quite rapidly, and we expect that to be a growing number in the years to come. Beyond that, there are -- then we go beyond payments and -- of course, while the payments are going through our system, a fair chunk or a percentage of that falls into deposits that stay with us. And so we have -- we classify that under our digital deposit category. So we are monitoring those 3 main items. And then beyond that, then we are looking at how to develop lifestyle, digital lifestyle products so that it's not just regarding financial services, but it's anything that touches other aspects of your lifestyle habits. It could be purchases, marketing. So we have Alfalah mall, so you can go purchase digitally there. You can also borrow for purchasing through our BNPL offerings. Then we have merchant solutions to help merchants actually migrate their businesses to digital. We also are trying to make digital branches, lifestyle branches where -- it's very convenient for people to come in and do their transactions without touching any -- or having any human interaction. So all those things are add-on services, just examples of that. There are many more that we have, and we are working on to improve that further.

Are you guys able to provide any clarity -- is this the normal dividend [Foreign Language]

I think like I gave you that overall strategy that we want to be reasonably consistent in the expectation of the market. So if you look at the trend line or the history of our last few years of dividend payouts, I think you'll see what you should expect over the coming quarters.

Sir, I just have a question on the sale of the Bangladesh operations. In your AGM notice, you mentioned the sale proceeds of about $47 billion. But then you also mentioned that the transaction will be done by a merger with Bank Asia. So are we going to have a shareholding in the surviving entity and there will be no exchange of cash? I just wanted to clarify.

It's a cash transaction. We will sell to Bank Asia, and they will merge this into their entity. We will be taken out by cash.

My question from [indiscernible]

My question is on the investment book. Can you tell me the weighted average yield and duration on the fixed PIBs? And what's the average spread over T-bills on the floating rate portfolio in VRF?

Okay. So on the floating rate PIBs, our yields are somewhere around 11.75%. That's the ballpark number. The fixed rate PIBs are 13%. The T-bills are close to 11% and the other -- the variable Sukuk, that's also 11% plus and the fixed rate Sukuk is 15% plus.

We have a few questions in the chat box. So the most favorite one is the reference to the composition of the investment book, which you've already answered. The next question is from Nadim, which is about what is the branch expansion plan for calendar year 2026?

Okay. So we will be opening branches. Actually, we intended to open branches both on the retail and the Islam front. But there is an evolving situation which we will monitor because of the Iran board. Otherwise, our plan is to open more than like around 50 branches in this period -- in this year.

A follow-up question with reference to the stock split. Would it be possible to have an update on the potential stock split announcement communicated earlier by the bank.

It's been approved and it's going to -- I think the book closure for that is going to be in April. So it's going to be affected in this month.

Couple of questions from [indiscernible] one is related to the policy rate outlook going forward? And what is the remittances situation and impact of the ongoing...

Yes, yes. Okay. So I think I've already highlighted in my earlier comments that we expect that the policy rate will increase going forward. It could be as early as next policy rate in April or perhaps in June, depending upon the evolving situation on this U.S. Iran conflict and obviously, its impact on domestic inflation and exchange rate.

And as far as the second question is concerned, possible impact on remittances. I think that was the question. Of course, I think almost everybody is concerned that remittances will be affected because -- our 2 main remitting countries are Saudi Arabia and UAE. And it looks like employment in those countries is going to be affected in the coming months because their own economies will have to go through some readjustment and uncertainty. And as a consequence of that, we're anticipating that remittances may go down. And as a scenario planning for our own exercise, we are looking at up to 20% reduction in the next year. But that's kind of the worst-case scenario planning that we do.

Thank you, sir. We have no raised off at the moment, and there is no remaining questions in the chat box. I close to the end of the meeting time. I'll just request Atif sir to have just concluding remarks for...

Thank you. Thank you very much for listening patiently to the presentation and then asking some very insightful questions. I hope we have answered your questions adequately. I think in the end, just suffice it to say we're living through some difficult times, uncertain times. But within that, we stay -- we remain optimistic and hopeful. While we do anticipate in the short run, there will be some shocks. But depending on how the geopolitical developments take place in the next couple of months, and there may well be opportunities also for Pakistan. As you all know, it seems like Pakistan is playing its cards well on -- as far as this problem is concerned. And if we are able to have some degree of settlement, which involves bringing Iran back into the economic mainstream of the world, then we may end up benefiting from that significantly. And I'm sure there will be a reconstruction exercise in the GCC. And again, we should present ourselves as a partner for that reconstruction effort as well. So while things look bleak right now, but there is -- there could be a silver lining, and we should remain hopeful and optimistic. Thank you very much.

Thank you, everyone, for joining in today and to host you in the next quarter results. Thank you. Take care.