In the Executive Committee of the club, Mr. Idress Memon, Mr. Mazhar Muneer Jafri, Mr. Muhammed Afzal, Mr. Ghulam Abbas, Mr. Nasir uddin Akber, Mr. Fayyaz Alam, Mr. Muhammad Naveed Hashmi, Mr. Ahsan Qadir Munshi, Mr. Abdul Razzak Memon, Miss. Nighat Chishti and Mrs. Wazahat Naseem were also elected unopposed for the next term. On this occasion the newly elected President Mr. Shams Zai and General Secretary Mr. Shamsul Haque in their welcome addresses congratulate the newly elected office bearers and Members Executive Committee. They said the process of election reflects the results that committees are very much cooperative to members.

COMMITTED TO LEADERSHIP

We are in the new Millennium — the much hyped about 21st Century. Society is changing rapidly and moving swiftly toward a new age, and as we enter that new age, we must develop new leaders, not just managers, capable of giving guidance, inspiration and new vision for a new time.

Change is constant and inevitable; things are always changing. 21st Century leaders must develop the capacity to think globally and act locally. They must be prepared to deal with a society experiencing global and social upheaval, rapid technological advancement, changing power relations, and its impact upon the lives of individuals and businesses. 21st Century leaders must unite and become creative forces. Certainly the task ahead of them is seemingly impossible. However, just as change is inevitable, so is progress. We are simply experiencing the birth pains of a new era.

We must become new men and new women, and build a new society that as Jesse Jackson says, prioritizes "human need over human greed". We must build a society, that as Jesse's son Jonathon says, "not just for the Rockefellers but for the Little Fellas". Bishop Desmond Tutu was quoted as saying that he was a "Prisoner of Hope". If he was hopeful, when under apartheid in South Africa, we surely have to be inspired and encouraged by his commitment. Remember every individual is unique and important. Your commitment to leadership development and social change will enhance your self esteem and self confidence while building a better world.

We at Faysal Bank Ltd. are committed to become leaders in banking and we firmly believe that leadership in any arena has direct relation with the Human Factor. Thus in line with our mission and our belief, we are constantly investing in the training and development initiative as we view it as an asset rather than an expense. We at Faysal Bank have a knack for attracting, developing and retaining satisfied bunch of employees. And not only this. We are confident that our consistent hard work and unwaivered commitment will take us closer to fulfilment of customers' satisfaction and our own aspirations. For some it could be the zenith. For us at Faysal its just the beginning.

—Muhammad Asha'ar Saeed

MUSLIM COMMERCIAL BANK LIMITED TERM FINANCE CERTIFICATES HEAVILY OVERSUBSCRIBED

The inaugural Term Finance Certificates (TFCs) issue of Muslim Commercial Bank Limited (MCB) has been oversubscribed over 6 times. As per initial subscription figures received from the banks, a total of Rs. 1207.78 million was received against Rs. 200 million offered to the general public. This is the largest ever public subscription received for a TFC offering to date. The total issue consists of Rs. 1600 million out of which Rs. 1400 million have been taken up by pre-IPO investors.

This is the first subordinated TFCs issue by a banking company in Pakistan. Backed by the credentials of MCB, the issue has attracted massive public response. Investors who applied through the public offer belong to various categories such as provident/pension/gratuity funds/Trust, insurance companies, financial institutions and individual investors. The Issue was advised and arranged by the Consortium of ABN AMRO N.V., Pakistan, Jahangir Siddiqui & Co. Ltd. and Global Securities Pakistan Ltd.

The issue has been assigned a rating of A+(A plus) by JCR-VIS Credit Rating Agency, offering a minimum rate of 11.75% and a maximum of 15.75% for a tenure of 5-1/2 years.

PSO'S PROFITS GROW BY 42%

The Board of Management of Pakistan State Oil Company Limited on Thursday (August 22, 2002) approved a final dividend comprising 80% cash (Rs 8/share) and 20% bonus shares for FY-2002. Combined with the earlier two interim cash dividends of Rs. 5 per share, the total amounts to Rs. 13 per share resulting in the highest-ever cash payout of Rs. 1.86 billion to shareholders of the company.

The announcement came, as an acknowledgement of the remarkable financial results as a result of unprecedented operating performance, at the conclusion of a PSO BoM meeting at PSO House to review the company's performance and accounts for the year ended June 30, 2002.

For the fiscal year ended June 30, 2002, despite the revenue drop and a record provision of Rs 2 billion made for taxes (an increase of Rs 800 million) PSO earned an all-time record profit before tax of Rs. 5.1 billion, up by 49% while profit after tax rose to Rs. 3.2 billion registering a growth of 42% over prior year period. In addition, the company absorbed the balance financial impact of Rs. 408 million on account of Voluntary Separation Scheme (VSS) offered in April 2001. Even after excluding adjustments and inventory gains / losses, operating profit of the company grew by an impressive 32% over the prior year. The profit increase is primarily due to innovative marketing strategies, organizational restructuring, product mix, revamping of internal systems with improved productivity along with the partial impact of enhanced margins during the last quarter.

Reduced offtakes of fuel oil by Hubco (around 0.9 million tons) primarily resulted in revenue drop of approximately Rs. 11 billion. Had Hubco's consumption level remained at the preceding year's level, the company would have not only reflected much higher growth in revenues but would also have maintained its market participation as fuel oil demand of this power utility was met by PSO being its sole supplier under a long-term Fuel Supply Agreement. The Board noted with appreciation that despite successive drop in international as well as domestic prices and consumption, specifically during first half of FY-02, PSO's gross revenues stood at Rs. 182.3 billion, down by 6.5% over prior period..

FY 2002 experienced global economic recession triggered by September 11, 2001 incident in the USA followed by coalition military operation in Afghanistan. Pakistan's proximity to Afghanistan and a war-like situation on its border with India put Pakistan's economy under tremendous pressure. Consequently, consumption of all products in Pakistan, which grew at a CAGR of 7% over last two decades, dropped by 4% in FY 2002. Consumption of Fuel Oil dropped by 6.3% and that of SKO and LDO dropped by 19% and 15.4% respectively. Motor Gasoline and HSD registered consumption decline of 2.0% and 0.3% respectively.

Despite all the externalities and adverse factors, PSO sold 11.5 million tons of POL products. The company maintained its market share of Mogas at 40% while it snatched 1% share in lubricants and Jet A-1 from the competition. The company managed to contain the decline in HSD sales volume despite overall low agricultural demand as well as restricted supplies to agricultural areas adjacent to Indian border, which have been solely fed by PSO. In addition, aggressive New Vision Development as well as Defence business won by competition for FY-02, which is now regained by PSO, also contributed to HSD volume drop.

Innovative ideas and services in retail business with a particular focus on development of New Vision outlets enabled PSO to enhance its market participation in Mogas and Lubricants. New Vision network expanded to 500 retail outlets at an average construction rate of 2.2 days per outlet. The company successfully equipped 600 retail outlets with Internet facility while C-Store network was expanded to 56, whereas 44 CNG facilities were operational. The latest launch of "PSO Loyalty Card" has been the most innovative marketing initiative, which has not only enabled the customer to earn "PSO Loyalty Points" redeemable in three cities, but has also offered them attractive discounts for their non-petroleum product purchases at a large number of merchant outlets. Other significant contributors to PSO's enhanced market participation were highly successful sales promotion and marketing campaigns, expansion of product range in lubricants and introduction of computerized complaint lodging system with toll-free number.

PSO's initiatives entailed the revamping of the organizational architecture, rationalization of staff, employee empowerment and development, transparency in decision-making through formation of various Cross-Functional Teams, and vertical integration through equity investments in pipeline projects. Implementation of Fleet Management Plan and Enterprise Resource Planning has been the key area of focus.

The Board of Management observed that the just concluded financial year 2001-02 has been an all-time record year in term of profits for PSO. The Board of Management expressed its confidence that in a complete deregulation scenario, PSO is fully geared to capitalize on its core competencies and take full advantage of opportunities arising out of changing business environment. PSO's enhanced profitability in the years to follow would be still better — thus rewarding all its stakeholders.

PSO WINS WAPDA'S FIRST-EVER INTERNATIONAL FUEL OIL TENDER

Pakistan State Oil (PSO), the largest oil marketing company in Pakistan, has won the first-ever international tender for Fuel Oil floated by the Water and Power Development Authority (Wapda).

Under the terms of the agreement, PSO will supply two loads of Fuel Oil, each of 55,000 metric tonnes. The first cargo is scheduled to be delivered by September 2-4 while the second will be delivered between September 25-27.

PSO had quoted the premium of US$12.95 and US$13.10 for the two cargoes, which was the lowest as compared to major international oil traders like Glencore and regional traders Fal and Bakri.

PSO has been supplying Fuel Oil to Wapda for the past several years when the prices were controlled by the government. Later, when the government deregulated the product, Wapda started purchasing through local tenders. PSO offered very competitive rates and business by beating local competition. With Wapda going for international tender, PSO has now beaten international competitors and won the business on merit. This shows the commitment of PSO to supply HSFO to Wapda at highly competitive prices.

"We have won Wapda's first international tender as our rates were most economical," a PSO spokesman said. "With competitive prices, we are committed to meet the requirements of the authority in the future also."

The Government of Pakistan had deregulated the import of Fuel Oil from July 1, 2000 for the oil marketing companies and other major consumers like the KESC and Wapda. The power utility has become the first independent consumer to import Fuel Oil.

On July 29th, PSO had entered into an agreement with Wapda for handling and storage of Fuel Oil. This agreement would facilitate the power utility to arrange a portion of its annual requirement through direct imports and PSO would store the product in its storage tanks for onward transportation to its power stations located at Jamshoro, Guddu, Muzaffargarh, Faisalabad and Multan.

Under the arrangement, the authority would pay an agreed hospitality charge to PSO. This would generate certain, assured and guaranteed ancillary profits for the PSO.

"The agreement has further strengthened the healthy business relationship between the two organizations and yet again demonstrated to Wapda that PSO is providing product at very cost-effective and competitive basis," the PSO spokesman added.

NEW CEO AND NEW MANDATES FOR WORLD GOLD COUNCIL

The World Gold Council Executive Committee has appointed James E Burton as the new Chief Executive Officer of the Council with effect from October 1, 2002. He will be based in the World Gold Council head office in London. The World Gold Council was founded in 1987 by the world's leading gold mining companies for the purpose of stimulating the demand for gold by consumers as well as investors.

"I am delighted that we have been able to attract someone of the calibre of Mr Burton to run the Gold Council," said Mr Chris Thompson, Chairman of the Executive Committee. "The World Gold Council has always had the potential to be a major influence in gold's traditional markets. What we need now is Mr Burton's extensive experience in the investment arena and his demonstrated management discipline to make the Council more effective." With the fundamentals of the gold market outlook improving and some fresh new investment product ideas for gold in the pipeline, the future for gold is as bright as I have seen it for some time. "

The new CEO previously served as the CEO of the California Public Employees Retirement System (Calpers), the largest public pension system in the USA with $140 billion in assets and 1.2 million participants. Burton pioneered a more active approach to institutional investing, emphasising corporate governance and management and board accountability to shareholders. He transformed Calpers to a value added organization and a global leader in pension investment.

Prior to Calpers, James Burton served as the Deputy State Controller for the State of California and held various other posts in the California State Government.

The Executive Committee, after an extensive review by Bain & Co of the Council's functions, has given the new CEO a specific mandate to reinvigorate the Council and focus equally on jewellery and investment demand, as well as on cutting costs on sub marginal programs. By year's end Mr Burton will present an overall strategy for the promotion of gold.

"I am thrilled with the opportunity to help bring gold to the greater attention of the world's markets," said Mr Burton. "I have spent a tremendous amount of time during the past several months examining how I can be most valuable to the investment community in this next phase of my career. I am convinced that the Council's new focus offers me that opportunity. "