PASHA_BANK_ANNUAL REPORT 2022

SECTION ONE GENERAL INFORMATION I. BANK’S FOUNDATION DATE, START-UP STATUTE, HISTORY ABOUT THE CHANGES IN THIS MENTIONED STATUTE 118 II. EXPLANATION ABOUT THE BANK’S CAPITAL STRUCTURE, SHAREHOLDERS OF THE BANK WHO ARE IN CHARGE OF THE MANAGEMENT AND/OR AUDITING OF THE BANK DIRECTLY OR INDIRECTLY, CHANGES IN THESE MATTERS (IF ANY) AND THE GROUP THE BANK BELONGS TO 119 III. EXPLANATION ON THE BOARD OF DIRECTORS, MEMBERS OF THE AUDIT COMMITTEE, PRESIDENT AND EXECUTIVE VICE PRESIDENTS, CHANGES IN THESE MATTERS (IF ANY) AND SHARES OF THE BANK THEY POSSESS 120 IV. EXPLANATION ON SHAREHOLDERS HAVING CONTROL SHARES 120 V. INFORMATION ON THE BANK’S SERVICE TYPE AND FIELD OF OPERATIONS 120 VI. EXISTING OR POTENTIAL, ACTUAL OR LEGAL OBSTACLES ON IMMEDIATE EQUITY TRANSFER BETWEEN THE BANK AND ITS SUBSIDIARIES OR REPAYMENT OF THE DEBT 121 SECTION TWO UNCONSOLIDATED FINANCIAL STATEMENTS I. BALANCE SHEET (STATEMENT OF FINANCIAL POSITION) 122 II. OFF-BALANCE SHEET 124 III. STATEMENT OF PROFIT OR LOSS 126 IV. STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME 127 V. STATEMENT OF CHANGES IN SHAREHOLDERS’ EQUITY 128 VI. STATEMENT OF CASH FLOW 130 VII. PROFIT DISTRIBUTION STATEMENT 131 SECTION THREE EXPLANATIONS ON ACCOUNTING POLICIES I. BASIS OF PRESENTATION 132 II. EXPLANATIONS ON STRATEGY OF USING FINANCIAL INSTRUMENTS AND FOREIGN CURRENCY TRANSACTIONS133 III. EXPLANATIONS ON FORWARD TRANSACTIONS, OPTIONS AND DERIVATIVE INSTRUMENTS 133 IV. EXPLANATIONS ON INTEREST INCOME AND EXPENSE 133 V. EXPLANATIONS ON FEE AND COMMISSION INCOME AND EXPENSE 134 VI. EXPLANATIONS ON FINANCIAL ASSETS 134 VII. EXPLANATIONS ON EXPECTED CREDIT LOSS 135 VIII. EXPLANATIONS ON OFFSETTING FINANCIAL ASSETS 138 IX. EXPLANATIONS ON SALES AND REPURCHASE AGREEMENTS AND SECURITIES LENDING TRANSACTIONS 138 X. EXPLANATIONS ON ASSETS HELD FOR RESALE AND FIXED ASSETS FROM DISCONTINUED OPERATIONS AND LIABILITIES RELATED WITH THESE ASSETS 138 XI. EXPLANATIONS ON GOODWILL AND OTHER INTANGIBLE ASSETS 138 XII. EXPLANATIONS ON PROPERTY AND EQUIPMENT 139 XIII. EXPLANATIONS ON INVESTMENT PROPERTIES 139 XIV. EXPLANATIONS ON LEASING TRANSACTIONS 140 XV. EXPLANATIONS ON PROVISIONS AND CONTINGENT COMMITMENTS 140 XVI. EXPLANATIONS ON OBLIGATIONS RELATED TO EMPLOYEE RIGHTS 140 XVII. EXPLANATIONS ON TAXATION 141 XVIII. EXPLANATIONS ON BORROWINGS 142 XIX . EXPLANATIONS ON ISSUANCE OF SHARES CERTIFICATES 142 XX. EXPLANATIONS ON AVALIZED DRAFTS AND ACCEPTANCES 142 Contents 116 PASHA Bank 2022 Annual Report