Aug 07 - 13, 2006

In today's business environment when customized financial solutions and personalized services make a big difference, the First Habib Modaraba (FHM) by virtue of its expertise and experience leads from the front and deliver up to the entire satisfaction of its stakeholders.

The Habib Group with vast experience in the industrial, financial and commercial sectors floated FHM in 1985. The basic aim of the FHM was to make contribution towards the transformation of our mercantile as well as financial system and dealings in line with principles elaborated in Sharia

The FHM is a multipurpose Modaraba and is engaged in multiple activities i.e. Ijara financing, Morabaha financing and equity investments.

FHM commenced its business operation in March, 1985, with initial capital of Rs.25.0 million only. Continuing with solid, dynamic and prudent approach now Allhamdolillah, the FHM has a total equity base of around Rs.1.600 billion and an asset size of approximately of Rs.4.0 billion which at present is the highest in entire Modaraba sector.

The Management of FHM has always given emphasis on building-up quality assets portfolio. The efficacy of FHM's business strategy and prudent risk management policies has supported the management to maintain outstanding assets quality while ensuring sustainability of performance, despite the increasingly competitive operating environment.

By the grace of Almighty Allah we have achieved considerable growth in size while maintaining solid assets portfolio, sound capital base and handsome return to stakeholders.

To give good return to Certificate Holders is the prime objective of the management of FHM and it is proved that in the very first year of operation, the profit was distributed to Certificate Holders. Subsequently, the FHM never failed to give dividend in any single year and profit has always been given in shape of cash dividend and stock dividend every year in 20 years of business operations without any fail.

It is also remarkable that in business operations of over two decades not a single advances portfolio has become bad or doubtful. FHM continues to maintain infection free assets portfolio which demonstrates good credit evaluation and effective risk management policies.

The management always believes in steady growth and not the policy of aggressive employment of Modaraba's fund. Efforts have always been made to enlarge the area of business in a prudent manner and execute funding transactions judiciously on selective basis with in-depth assessment of client. Business transactions have always been done on economic considerations, keeping in view the safety of investor's funds.

Through judicious administration of funds and sound investment policies, the FHM has assembled a very lucrative portfolio of investment that has consistently yielded very attractive returns.

With continuing sound financial position, the FHM is also maintaining 'A' category credit rating since almost last 10 years. Recently, on financials of 30th June, 2005, M/s Pakistan Credit Rating Agency Ltd. (PACRA) has awarded rating scale of A1+ for short term and AA for long term. A1+ is highest level in PACRA's rating scale for short term rating. According to PACRA's assessment the credit rating of FHM indicate a very low expectation of credit risk and very strong capacity for timely payment of financial commitments.

Moreover, the FHM has also secured the 'Excellence Award' on best performing Modaraba within Modaraba sector for four consecutive years from Modaraba Association of Pakistan.

Since the very start of business operation, FHM has concentrated on Ijara financing as a core and main line of business. No doubt, the leasing sector is performing well since the last several years and it has been proven that this sector is playing its great role for growth in capital investment and industrialization of Pakistan. However, presently this sector is facing intense competition from conventional and Islamic commercial bank as these banks have entered in lease business with low cost of funds available with them and also with strong support of large network of branches all over Pakistan.

The management of FHM is keeping a close eye on the emerging opportunities and preparing itself for the new Sharia compliant product by way of continuous market research.

Being a multipurpose Modaraba, FHM has a variety of various modes of businesses based on the Islamic principles while retaining Ijara as its main line of business. Evolution is inevitable for a growing organization like FHM so that it can perform a bigger role in the Islamic financial system of the country with expansion of its size and scope.

The diversification will not only elevate our capability to serve our customer more effectively but also increase business volume as well.

We draw our success by complying with highest ethical and moral standards. FHM makes all efforts to enhance superior professional competencies. To conquer new heights and accept new challenges, are always constant realities of FHM. Consistent planning, professionalism and proactive approach are the keys to our success.

We are confident that we will keep embarking our ambitious target with high level of customer satisfaction. We will continue to keep our growth momentum with dedication and deep sense of commitment while maintaining our financial discipline, adhering to professional and moral codes.