TMFB TSC 2012 Prospectus PDF

ADVICE FOR INVESTORS INVESTORS ARE STRONGLY ADVISED IN THEIR OWN INTEREST TO CAREFULLY READ THE CONTENTS OF THE
PROSPECTUS, ESPECIALLY THE RISK FACTORS AT PARA 4.4 BEFORE MAKING ANY INVESTMENT DECISION.
TAMEER MICROFINANCE BANK LIMITED

(A MICRO FINANCE BANK INCORPORATED UNDER THE COMPANIES ORDINANCE 1984 AND LICENSED UNDER THE MICROFINANCE INSTITUTIONS ORDINANCE, 2001)
PROSPECTUS
PUBLIC OFFER OF RATED LISTED AND PARTIALLY SECURED*TERM FINANCE CERTIFICATES [TAMEER SARMAYA CERTIFICATES TFC 1andTFC 2] FOR AN AGGREGATE AMOUNT OF PKR 1,000,000,000,
* [THE ISSUE WILL BE SECURED PARTIALLY THROUGH THE MICROFINANCE CREDIT GUARANTEE FACILITY PROVIDED BY THE STATE BANK OF PAKISTAN. THE SECURITY WILL BE A PARTIAL GUARANTEE OF 40% OF THE OUTSTANDING PRINCIPAL COMPONENT. FOR DETAILS PLEASE REFER TO PART 6 OF THE PROSPECTUS TITLED TRUSTEE AND SECURITY]
TAMEER SARMAYA CERTIFICATES ARE FIXED RATE AND FIXED TENOR INSTRUMENTS AS ILLUSTRATED HEREINBELOW:
Type TFC 1 TFC 2 Total
Tenor 13 months 24 months
Issue Amount In PKR (Million) 500 500 1,000
Profit Rate 12.00% p.a. 12.50% p.a.
INSTRUMENT RATING A (Single A) ENTITY RATING A (Single A) BY JCR-VIS Credit Rating Company Limited
PUBLIC SUBSCRIPTION: From November 21st2012 to February 21st2013 (both days inclusive).
DATE OF PUBLICATION OF THIS PROSPECTUS IS 14TH November2012
Prospectus Tameer Sarmaya Certificate
GLOSSARY OF ABBREVIATIONS AND TERMS

The capitalized terms used in this Prospectus unless otherwise defined therein, shall have the following meaning: 1. 1.1. 1.2. 1.3. 1.4. 1.5. 1.6. 1.7. 1.8. 1.9. 1.10. 1.11. 1.12. 1.13. 1.14. 1.15. 1.16. 1.17. Definitions ALCO means the Asset Liability Committee of Tameer Bank Call Option Redemption Prior to Final Redemption Date (For details please refer to para 2.15.of the prospectus titled Call and Put Options); Call Option Notice has the meaning ascribed thereto in Paragraph 2.15 (Call and Put Options); CDC means the Central Depository Company of Pakistan Limited; CDC Regulations means the Central Depository Company of Pakistan Limited Regulations; CDS means the Central Depository System of the CDC; Closed Period has the meaning ascribed thereto in sub-paragraph 2.1.1 (Registered Instruments and Register of TFC Holders) of Paragraph 2.1 (Instrument Registration); Closing Date means the last date of the Subscription Period on which the subscription money in respect of the Issue is received by the Bankers to the Issue; Date of Investment means the date when an Eligible Investors subscription money is received by any of the Bankers to the Issue; Declaration of Trust has the meaning ascribed thereto in Paragraph 6.1 (Declaration of Trust) of PART 6 (Trustee and Security); Eligible Investors has the meaning ascribed thereto in Paragraph 2.1 (Eligible Investors); Events of Default has the meaning ascribed thereto in Paragraph 6.4 (Events of Default and Consequences) of PART 6 (Trustee and Security); Guaranteed Obligations has the meaning ascribed thereto in Paragraph 6.1.1 (MCGF Guarantees) of PART 6 (Trustee and Security); GPRS POS Technology a mobile POS system with GPRS technology and allows to take POS wherever one go. Initial Issue Expenses has the meaning ascribed thereto in Paragraph 3.3 (Expenses of the Issue) of PART 3 (Commission, Brokerage and Other Expenses of the Issue); Interim Period means the period commencing from the Closing Date and ending on the Issue Date; Issue has the meaning as ascribed thereto in Paragraph 2.1 (Issue) of PART 2 (TFCs and Related Matters);
Tameer Micro Finance Bank Limited
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1.18. 1.19. 1.20. 1.21. 1.22.
Issue Date means the date on which the TFCs are issued (dispatched/credited)to the TFC Holders; Issuer means Tameer Microfinance Bank Limited; Investors means those Eligible Investors to whom the TFCs will be allotted in accordance with the provisions of this Prospectus; KSE Approval has the meaning ascribed thereto in Sub-paragraph 1.2.1 (Approval of the Prospectus by KSE) & (Approval, Consents and Listings); Lead Advisor means the bank appointed to arrange and manage all aspects of the Issue lead advisor appointed for Tameer TFC is Standard Chartered Bank (Pakistan) Limited (Standard Chartered) ; Legal Advisor means the legal counsel engaged as the transaction counsel in respect of the Issue, legal advisor appointed for Tameer TFC is Mandviwalla and Zafar Associates ; Listing Regulations means the Listing Regulations of the Karachi Stock Exchange Limited; Material Contracts means the contracts listed in Paragraph 9.1.6 (Material Contracts / Documents) of PART 9 (Miscellaneous Information); MCGF Guarantees has the meaning ascribed thereto in sub-paragraph2.1.3.1 of Paragraph 2.13 (MCGF Guarantee); MCGF Guidelines means the Microfinance Credit Guarantee Facility (MCGF) Guidelines issued by the State Bank of Pakistan, Agricultural Credit & Microfinance Department under AC&MFD Circular No. 3 of 2012 dated June 21, 2012http://www.sbp.org.pk/acd/2012/C3-AnnexA.pdf; Microfinance Ordinance means the Microfinance Institutions Ordinance, 2001 issued by the State Bank of Pakistanhttp://www.sbp.org.pk/l_frame/MF_Inst_Ord_2001.pdf ; Obligations means inter alia the Redemption Amount and all other amounts payable by the Issuer to the TFC Holders in respect of the TFCs and includes the amounts payable by the Issuer to the TFC Holders pursuant to the Declaration of Trust and the Terms and Conditions (For details please refer to definition of the term Obligations given in Section 6.1.1); Ordinance means the Companies 1984http://www.secp.gov.pk/corporatelaws/pdf/Comp_Ord1984.pdf; Ordinance,
1.23. 1.24. 1.25. 1.26. 1.27.
1.28.
1.29.
1.30. 1.31.
Put Option means the option to sell the TFC; For details please refer to para2.15.2of the prospectus titled Call and Put Options) Redemption Amount means, in respect of TFC 1 and TFC 2, the amounts payable by the Issuer to the TFC Holders on each Redemption Date for such TFCs, and comprising of the principal component and the profit calculated on the profit rate; Redemption Date means each date on which the Redemption Amount is payable by the Issuer in respect of TFC 1 and TFC 2, being the dates that shall be set out in the Redemption Schedule;
Tameer Micro Finance Bank Limited Page 3 of 83
1.32.
1.33.
1.34.
Subscription Period means the period during which the Issue is open for subscription to the public, being the period commencing from [November 21st2012] and ending on [February 21st2013] (both days inclusive); Successful Subscribers means the members of the public that have subscribed to the Issue during the Subscription Period and to whom the TFCs have been allotted in accordance with the provisions of this Prospectus; Telenor means Telenor Pakistan Limited; Terms and Conditions means the terms and conditions governing the TFCs attached as Schedule 6 to the Declaration of Trust; TFC Holders means the persons registered as the holders of the TFCs in the register of the TFCs maintained by the Issuer in accordance with the Declaration of Trust; and TFC Subscription Application means the application for subscription to the Issue in the prescribed format, available with the Bankers to the Issue and to be duly filled and filed by each Eligible Investor for the purpose of subscription to the Issue. Trigger Events In the event Telenor divests its shareholding in the Issuer and / or the Issuer has knowledge that Telenor intends to divest its shareholding in the Issuer, which would result in Telenor being less than 51% shareholder in the Issuer, then the Issuer shall immediately inform the Trustee of the same (Trigger Event). Touchpoints Touchpoint is the interface of a product, a service or a brand with customers, non-customers, employees and other stakeholders before, during and after a transaction.
1.35.
1.36. 1.37. 1.38. 1.39.
1.40.
1.43
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2.
Abbreviations ALCO Asset and Liability Committee; CAGR Compounded Annual Growth Rate; CEOChief Executive Officer; CROthe Companies Registration Office of the SECP; CGAP Consultative Group to Assist the Poor; CVT Capital Value Tax; DFID Department for International Development, United Kingdom; EMI Equal Monthly Installment; GAAP Generally Accepted Accounting Principles; GoP the Government of Pakistan; GLP Gross Loan Portfolio IPO Initial Public Offering; ISE Islamabad Stock Exchange; JCR JCR-VIS Credit Rating Company Limited; KSE Karachi Stock Exchange Limited; LSE Lahore Stock Exchange; SCRA Special Convertible Rupee Account; SECP the Securities and Exchange Commission of Pakistan; SBP the State Bank of Pakistan; TDR Term Deposit Receipt; TFC Term Finance Certificate and it includes two types of TFCs i.e. Tameer Sarmaya Certificate 1 and Tameer Sarmaya Certificate 2; TFC 1 Tameer Sarmaya Certificate 1 @ 12% for thirteen months. TFC 2 Tameer Sarmaya Certificate 2 @ 12.5% for two years. WHT Withholding Tax.
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TABLE OF CONTENTS
PART -1 1. APPROVALS, CONSENT AND LISTING ON THE STOCK EXCHANGE----9 PART-II 2. TERM FINANCE CERTIFICATES AND RELATED MATTERS----------------12 PART-III 3. COMMISSIONS,BROKERAGE AND OTHER EXPENSES OF THE ISSUE--24 PART-IV 4. HISTORY AND PROSPECTS--------------------------------------------------------------26 PART-V 5. FINANCIAL INFORMATION & CREDIT RATING REPORT-------------------39 PART-VI 6. TRUSTEE AND SECURITY----------------------------------------------------------------59 PART-VII 7. MANAGEMENT OF THE COMPANY--------------------------------------------------63 PART-VIII 8. MISCELLANEOUS INFORMATION----------------------------------------------------68 PART-IX 9. APPLICATION AND ALLOTMENT INSTRUCTIONS-----------------------------71 PART-X 10. SIGNATORIES TO THE PROSPECTUS------------------------------------------------76 PART-XI 11. MEMORANDUM OF ASSOCIATION---------------------------------------------------78 PART-XII 12. SUBSCRIPTION FORM----------------------------------------------------------------------86
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1. SUMMARY OF THE ISSUE

Issuer Issue / Transaction Tameer Microfinance Bank Limited(Tameer or the Bank) Rated, Listed and partially Secured Term Finance Certificates (TFCs) issued as an instrument of redeemable capital under Section 120 of the Companies Ordinance, 1984. The proceeds of the issue will be utilized for expansion of the Issuers Advances portfolio( For details refer to paragraph 2.12) Upto PKR 1000 million as per the table given below. TFC 1 Tenor Amount (PKR Mn) 13 months 500 TFC 2 24 months 500
Purpose
Total Issue Amount Tenor and Amount Offered
Profit Rate
TYPE OF TFCs RATE TFC-1 12.0% per annum TFC-212.5% per annum TYPE OF TFCs FREQUENCY TFC-1 Monthly TFC-2 Monthly
Profit Payment Frequency
Subscription Period Profit Accrual
3 months for both types of TFCs from November 21st 2012 to February 21st2013. From the Date of Investment in the Issue
Security
The Issue will be secured partially through the Microfinance Credit Guarantee Facility, provided by the State Bank of Pakistan. Through this facility, each TFC 1 and TFC 2 are guaranteed up to the extent of 40% of the outstanding principal component of the Redemption Amount as on the date of event of default by the Bank ( For details please refer to paragraph 6.1.1). A (Single A) by JCR VIS A (Single A) by JCR VIS PKR 5,000/- or in multiples thereof;
Issue Rating Entity Rating Minimum Investment
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Listing Lead Advisor & Structuring Bank
Karachi Stock Exchange Limited (KSE ;) Standard Chartered Bank (Pakistan) Limited (Standard Chartered or Lead Advisor & Structuring Bank or LA);
Issue Schedule
Date of Opening of subscription period Date of Closing of Subscription period Date of Interim Profit Payment Issue Date Profit Payments Principle Repayment/Redemption Maturity Date Standard Chartered Bank (Pakistan) Limited Bank Al Falah Limited Askari Bank Limited Faysal Bank Limited Tameer Micro Finance Bank Limited Bank Al Habib Limited Summit Bank Limited Habib Metropolitan Bank Limited KASB Bank Limited Sindh Bank Limited
November 21st,2012 February 21st,2013 March 15th,2013 March 16th,2013 Please refer to para 2.14 Please refer to para 2.14 Please refer to para 2.14
Bankers to The Issue
Underwriting Listing
None
Karachi Stock Exchange Limited (KSE)
Market Maker Allotment basis Holding of TFCs Put Option(Early Redemption) Registrar& Transfer Agent Trustee Risk Factors
JS Global Capital Limited First come first serve basis TFCs may be held either in physical form or in book entry (scrip-less) form through CDS of CDC Exercisable only upon the occurrence of a Trigger Event as described in para 2.15.2 THK Associates (Pvt) Ltd IGI Investment Bank Ltd. For details refer to para 4.6
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Prospectus Tameer Sarmaya Certificate PART I
1. APPROVALS, CONSENT AND LISTING ON THE STOCK EXCHANGE 1.1. APPROVAL OF THE SECURITIES AND EXCHANGE COMMISSION OF PAKISTAN Approval of the Securities and Exchange Commission of Pakistan as required under section 57(1) of the Companies Ordinance, 1984 (the Ordinance) has been obtained for the issue, circulation and publication of this Prospectus. Disclaimer It must be distinctly understood that in giving this approval, the Securities and Exchange Commission of Pakistan (SECP) does not take any responsibility for the financial soundness of the Issuer and any of its schemes stated herein or for the correctness of any of the statements made or opinions expressed with regards to them by the Tameer Microfinance Bank Ltd (Tameer or the Company or the Issuer) in this Prospectus. SECP has not evaluated quality of the issue and its approval for the issue, circulation and publication of this prospectus should not be construed as any commitment of the same. The public/ investors should conduct their own independent due diligence and analysis regarding the quality of the issue before investment in the TFC being offered through this prospectus. 1.2. CLEARANCE OF PROSPECTUS BY KARACHI STOCK EXCHANGE The Prospectus for the issue of rated, listed and partially secured Term Finance Certificate (TFCs) has been cleared by the Karachi Stock Exchange Limited (KSE) in accordance with the requirements under its Listing Regulations. Disclaimer The publication of this document does not represent solicitation by KSE. The contents of this document do not constitute an invitation to invest in TFCs or subscribe for any securities or other financial instrument by KSE, nor should it or any part of it form the basis of, or be relied upon in any connection with any contract or commitment whatsoever of KSE. It is clarified that information in this Prospectus should not be construed as advice on any particular matter by KSE and must not be treated as a substitute for specific advice. KSE disclaims any liability whatsoever for any loss howsoever arising from or in reliance upon this document to any one, arising from any reason, including, but not limited to, inaccuracies, incompleteness, and/ or mistakes, for decisions and/ or actions taken based on this document. KSE neither takes responsibility for the correctness of contents of this document nor the ability of the Issuer to fulfill its obligations thereunder. Advice from a suitably qualified professional should always be sought by investors in relation to any investment in securities.
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1.3. FILING OF PROSPECTUS AND OTHER DOCUMENTS WITH THE REGISTRAR OF COMPANIES The Company has delivered to the Registrar of Companies, Karachi as required under sections 57 (3) and (4) of the Companies Ordinance 1984, a copy of this Prospectus signed by all the Directors of the Company together with the following documents attached thereto: (a) Auditors Report bearing reference number AC2/419/12 dated April 3, 2012 under Section 53(1) read with Clause 28(1) of Section 2 of Part 1 of the Second Schedule of the Ordinance; (b) Letter from the Auditors bearing reference number AC2/418/12 dated April 3, 2012 being the Consent under Section 55 of the Ordinance; (c) Auditors Certificate on Break-up Value per Share bearing number AC2/420/12 dated April 3, 2012; (d) Auditors Certificate on Issued, Subscribed and Paid-up Capital bearing number AC2/421/12 dated April 3, 2012; (e) Interim Condensed Financial Statements for the Half Year Ended June 30, 2012 issued on July 20, 2012; (f) Copies of Contracts listed in sub-paragraph 9.1.6 of PART9 (Miscellaneous Information); (g) Written confirmations of the Auditors, Legal Advisors and Bankers to the Issue, mentioned in the Prospectus consenting to act in their respective capacities, as required under Section 57(3)(a) of the Ordinance; (h) Consent of Directors and Chief Executive of the Issuer to their respective appointments being made and their having been named or described as such Directors and Chief Executive in the Prospectus as required under Section 57(3) of the Ordinance, read with sub-clause (1) and (4) of Section 1 of Part 1 of the Second Schedule of the Ordinance. The Issuer has filed written confirmations of such consents, as required under Section 184 of the Ordinance. 1.4. LISTING ON KARACHI STOCK EXCHANGE Application has been made to the KSE for permission to deal in and for quotation of the TFCs of the Company. If for any reason, the Application for Listing is not accepted by KSE, the Issuer undertakes to immediately publish a notice in the press a notice to that effect and to thereafter to refund the subscription money with profit at the rate of 12.00% and 12.50% (depending on investment in TFC 1 or TFC 2 respectively) without surcharge as required under Section 72 of the Ordinance, and if any such money is not refunded within eight (8) days after the Issuer becomes liable to refund it, the Directors of the company shall be liable to refund the money from the expiration of the said eighth (8th) day together with surcharge at the rate of 1.5% per month as required under the provisions of Section 72 of the Ordinance.
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PART II 2. TERM FINANCE CERTIFICATES AND RELATED MATTERS 2.1. ISSUE OF LISTED TFCS TO THE GENERAL PUBLIC The Total TFC Issues consists of PKR 1,000,000,000 to be issued in the form of rated, listed and partially secured Term Finance Certificates (TFCs) being the instrument of redeemable Capital under section 120 of the Ordinance for the tenors of thirteen (13) months, and twenty four (24) months as follows: PKR Million Tenor Amount (Rs. in million) Profit Payment TFC 1 13 Months 500 Monthly TFC 2 24 Months 500 Monthly
These are the first listed TFC Issues by Tameer Microfinance Bank Limited. The TFCs will be offered to the general public under the brand name of Tameer Sarmaya Certificate each set having an aggregate face value of PKR 5,000/- or in multiples thereof. TFCs will be issued in two classes i.e. Tameer Sarmaya Certificate 1 (TFC 1) and Tameer Sarmaya Certificate 2 (TFC 2) and both these classes of term finance certificates shall comprise of such number of coupons as correspond to the number of Redemption Dates. The minimum amount of application for the subscription of TFCs is PKR 5,000/-. The TFC is structured to redeem as per para 2.13. The redemption value of the TFCs shall be specified on the TFC itself. For more details, please refer to paragraph 2.13. Notwithstanding that the TFCs shall be issued as TFC 1 and TFC 2, both classes of TFCs shall entitle the holder thereof to the same rights and benefits and both TFCs shall be identical as to the rights of the TFC Holders and the Trustee and the obligations of the Issuer, except differences in the Redemption Dates in respect of the principal component, the final Redemption Date and the Profit Rate. Each TFC shall have a face value of PKR 5,000 and may be issued in multiples thereof. There is no pre-IPO placement; the entire amount is available for subscription by the public including both individual and institutional investors for three (3) months from the date of commencement of public subscription. However, if the target amount i.e. PKR 1,000,000,000 is subscribed before the end of the subscription period, the subscription period will be closed immediately. Since there is no minimum subscription requirement, all subscription amounts up to the target amount of PKR 1,000 Million will be listed on KSE. 2.2 PARTIALLY SECURED TERMFINANCE CERTIFICATES
The Issue will be secured partially through the Microfinance Credit Guarantee Facility, provided by the State Bank of Pakistan. Through this facility, each TFC1 and TFC 2 are guaranteed up to the extent of 40% of the outstanding principal component of the Redemption Amount as on the date of event of default by the Bank ( For details please refer to para 6.1.1).
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2.3. INTEREST OF TFC HOLDERS The TFC Holders have no special interest or other interest in the property, assets and / or profit of the Issuer except as the holders of the TFC. 2.4. OPENING AND CLOSING OF SUBSCRIPTION THESUBSCRIPTION LIST SHALL BE OPEN FOR 3 MONTHSBOTH FOR TFC-1 and TFC-2 AT THE COMMENCEMENT OF BANKING HOURS ON NOVEMBER 21ST2012 AND CLOSE AT THE END OF BANKING HOURS ON FEBRUARY 21ST2013 (BOTH DAYS INCLUSIVE) 2.5. INVESTOR ELIGIBILITY The following persons can invest in the Issue: Pakistani citizens residing in or outside Pakistan; Persons holding dual nationalities including Pakistani nationality; Foreign Nationals whether residing in or outside Pakistan; Companies, bodies corporate or other legal entities incorporated or established in or outside Pakistan (to the extent permitted by their constitutive documents and existing regulations, as the case may be); Mutual Funds, Provident/pension/gratuity funds/trusts, (subject to the terms of the Trust Deed and existing regulations); Branches in Pakistan of companies and bodies corporate incorporated outside Pakistan; and / or Such other Persons that are permitted to invest in TFCs pursuant to the relevant provisions of the Ordinance and their constituent documents. Additional Instructions for Foreign/Non-Resident Investors In case of foreign investors who are not individuals, applications must be accompanied with a letter on applicants letterhead stating the legal status of the applicant, place of incorp oration and operations and line of business. A copy of memorandum of association or an equivalent document should also be enclosed, if available. Where applications are made by virtue of Power of Attorney, the same must be lodged with the application. Copies of these documents can be attested by the bank manager/officer in the country of applicants residence. Such applicants may also subscribe using their Special Convertible Rupee Account (SCRA) as set out in the State Bank of Pakistans Foreign Exchange Manual. 2.6. MINIMUM AMOUNT OF APPLICATIONAND BASIS OF ALLOTMENT OF TFCS The minimum amount of application for subscription to the Issue is PKR 5,000; Applications for subscription of less than one (1) TFC, i.e. an application for subscription for an amount less than PKR 5,000shall not be entertained. Application for TFCs by the general public, including institutions and individuals, must be made fora minimum of the aggregate face value of Rs. PKR 5,000 or in multiples thereof. Allotment of TFCs shall be subject to scrutiny of applications for subscription.
Allotment of TFCs shall be made on a First Come-First Served Basis and applications for subscription of TFCs shall not be accepted once the issue amount for each class of TFCs has been fully subscribed. In case Bankers to the Issue on any given day accept subscriptions which result in the target amount under each TFC 1 and TFC 2 being exceeded, then all applications in excess of the target amount will be returned to the applicants along with profit at the rate of 12.00% and 12.50% (depending on TFC-1 or TFC-2, respectively) per annum for the number of days for which such applicants are deprived of their money. Therefore there will be no over subscription. In order to ensure that the allotment of the TFCs is made to the Investors on a First Come-First Served basis, the Bankers to the Issue shall mark each application for subscription with the date and time of receipt and all applications shall be processed in a chronological order. The applications not marked with the date and time of receipt shall be accommodated after all the applications properly marked with the date and time have been accommodated. Allotment of TFCs shall be subject to scrutiny of applications for subscription. Profit Payment for TFC Investment Monies Profit will be paid at a fixed rate of profit at the rate of 12.00% and 12.50% per annum, depending on investment in TFC 1 or TFC 2 respectively from the Date of Investment. To bring all TFCs at par, an interim profit payment for the period from the Date of Investment till the Issue Date will be made of the TFCs after the close of subscription period on March 15th,2013. From the Issue Date, all subsequent profits shall be payable monthly (for TFC 1 and TFC 2) in arrears on the outstanding Principal amount. 2.7. REFUND OF MONEY TO UNSUCCESSFUL APPLICANTS The Issue has been structured on First Come-First Served Basis as such there will be no oversubscription. However in the event upon the Issue being fully subscribed, the Bankers to the Issue accept any applications for subscriptions that results in the Bankers to the Issue receiving an amount in excess of the issue amount of each class of TFCs, then the Bankers to the Issue shall refund such excess amount to the applicants along with profit accrued on such excess amount calculated as follows: a) all excess subscription monies received in respect of TFC 1 (TFC 1 Refund Amount) shall accrue profit at the rate of 12.00% p.a., to be calculated from the Date of Investment till the actual date of payment plus three (3) additional days; and b) all excess subscription monies received in respect of TFC 2 (TFC 2 Refund Amount) shall accrue profit at the rate of 12.50% p.a., to be calculated from the Date of Investment till the actual date of payment plus three (3) additional days; 2.8. MINIMUM SUBSCRIPTION The Issue is not subject to any minimum subscription requirement as the issue is not project specific but the proceeds of the issue will be utilized to expand Tameers portfolio, and to meet short term working capital requirements.
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2.9. ISSUE,CREDIT AND DESPATCH OF TFCS

The Company shall credit or dispatch, as the case may be, TFCs within thirty (30) days from the Date of Investment. TFCs will be issued either in scripless form in the Central Depository System (CDS) or in the shape of physical scrips on the basis of option exercised by the successful applicants. TFCs in physical form shall be delivered to the applicants through registered mail or courier service, whereas scripless TFCs shall be directly credited through book entries into the respective CDS accounts of allottees maintained with the Central Depository Company of Pakistan Limited (CDC). The TFCs issued directly for induction in the CDS, without the issuance of the physical certificates and the TFC scrips (with the terms and conditions), shall be subject to the terms and conditions for the issuance of the TFCs specified in Schedule E of the Trust Deed dated February 14, 2012 executed between the Company and the Trustee for the TFC Issue.
The applicants who opt for issuance of TFCs in scripless form in the CDS should fill in the relevant columns in the Application Form. In order to exercise the scripless option, the applicant must also have a CDS account at the time of subscription. In case where the CDS account is not mentioned or is not correct, physical TFC certificates will be issued. If the Company defaults in complying with the requirements of the Listing Regulations, it will pay to the KSE a penalty of PKR 5000/- per day for the period during which the default continues. The KSE may also notify the fact of such default and the name of the Company by notice and also by publication in the Daily Quotation. 2.10. TRANSFER OF TFCS
2.10.1. Physical Scrips TFCs shall be transferred in the manner as provided under the Companies Ordinance, 1984.Transfer of TFCs will be subject to payment of the applicable stamp duty levied by the Provincial Government. Stamp duty on initial issuance will be borne by the Company, while stamp duty on subsequent transfer will be on account of the TFC holders. 2.10.2. Transfer under Book Entry System TFCs will be declared as eligible security through the CDS of CDC and will be eligible for transfer after the Issue Date. Stamp duty on initial issuance will be borne by the Company. TFCs, which are in the CDS, shall subsequently be transferred in accordance with the Central Depositories Act, 1997 and the Central Depository Company of Pakistan Limited regulations. The transfer fee for all subsequent transfers shall be borne by the TFC holders. 2.10.3. Stamp Duty and Costs and Charges The stamp duty applicable on the transfer of TFCs shall be borne by the TFC Holders affecting such transfer. All costs and charges of the CDC applicable on the transfer of the TFCs in the CDS shall be borne by the TFC Holder affecting such transfer. Notwithstanding anything contained in this Prospectus, the term transfer as used in this Prospectus does not mean and / or include, nor shall be deemed to and / or interpreted to mean and / or include the initial issuance of the TFCs to the Investor by the Issuer.
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2.11.
TFC ISSUES IN PRECEDING YEARS
The Issuer has not issued any term finance certificates, whether privately placed and / or offered to the public in the preceding years. 2.12. PRINCIPAL PURPOSE OF SUBSCRIPTION MONEY
The proceeds of the Issue, comprising of the subscription monies shall be utilized by the Issuer towards the expansion of the Issuers advances portfolio. 2.13. REGISTERED INSTRUMENT
TFCS WILL BE IN REGISTERED FORM AND THE COMPANY SHALL MAINTAIN OR CAUSE TO BE MAINTAINED A REGISTER OF TFC HOLDERS. 2.14. REDEMPTION OF TFCS
A register of TFC holders will be maintained or cause to be maintained by the Company. The register of TFC holders will be closed for a period of 7 days prior to the profit payment.
The Company will give a minimum of 14 days notice to the Exchange prior to the Book Closure for Profit payments. All payments will be made either through crossed cheque, pay order or direct bank deposit on the basis of option exercised by the applicant in the TFCs Subscription Application. In case of cheque or pay order, the instrument will be dispatched to the mailing address of the registered holder of the TFC. Redemption Schedule for TFC 1 The illustrative Redemption Schedule in respect of TFC 1 having a Face Value of PKR 5000 based on a profit rate of 12% (as set out in Column III) for thirteen (13) months investment as set out in Column (I):
I Months II Principal Redemption III Indicative Profit @ 12.00 %
50 49.99 49.98 49.97 49.96 49.95 49.94 49.93 49.92 49.91 49.9 49.89 49.88 649.22
IV Zakat @ 2.5%
0.03 0.03 0.03 0.03 0.03 0.03 0.03 0.03 0.03 0.03 0.03 0.03 124.7 125
V Withholding Tax @ 10%
VI Total Payment
VII Principal Payment in %

0.02% 0.02% 0.02% 0.02% 0.02% 0.02% 0.02% 0.02% 0.02% 0.02% 0.02% 0.02% 99.76% 100.00%
VIII Principal Amount Outstanding

5,000.00 4,999.00 4,998.00 4,997.00 4,996.00 4,995.00 4,994.00 4,993.00 4,992.00 4,991.00 4,990.00 4,989.00 4,988.00 0
0 1 2 3 4 5 6 7 8 9 10 11 12 13 Total 1 1 1 1 1 1 1 1 1 1 1 1 4,988 5,000.00 5 5 5 5 5 5 4.99 4.99 4.99 4.99 4.99 4.99 4.99 64.92 45.97 45.96 45.95 45.94 45.93 45.92 45.92 45.91 45.9 45.89 45.88 45.87 4908.19 5,459.23
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Redemption Schedule for TFC 2 The illustrative Redemption Schedule in respect of TFC 2 having a Face Value of PKR 5000 based on a profit rate of 12.5% (as set out in Column III) for twenty-four (24) months investment (as set out in Column I):
I Months
II Principal Redemption
III Indicative Profit @ 12.50 %
IV Zakat @ 2.5%
V Withholding Tax @ 10%
VI Total Payment
VII Principal Payment in %
VIII Principal Amount Outstanding

5,000.00
0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 Total 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 4,977 5,000.00 52.08 52.07 52.06 52.05 52.04 52.03 52.02 52.01 52 51.99 51.98 51.97 51.96 51.95 51.94 51.93 51.92 51.91 51.9 51.89 51.88 51.86 51.85 51.84 1,247.13 0.03 0.03 0.03 0.03 0.03 0.03 0.03 0.03 0.03 0.03 0.03 0.03 0.03 0.03 0.03 0.03 0.03 0.03 0.03 0.03 0.03 0.03 0.03 124.43 125 5.21 5.21 5.21 5.21 5.2 5.2 5.2 5.2 5.2 5.2 5.2 5.2 5.2 5.19 5.19 5.19 5.19 5.19 5.19 5.19 5.19 5.19 5.19 5.18 124.71 47.84 47.83 47.82 47.81 47.81 47.8 47.79 47.78 47.77 47.76 47.75 47.74 47.73 47.73 47.72 47.71 47.7 47.69 47.68 47.67 47.66 47.64 47.63 4899.23 5997.29 0.02% 0.02% 0.02% 0.02% 0.02% 0.02% 0.02% 0.02% 0.02% 0.02% 0.02% 0.02% 0.02% 0.02% 0.02% 0.02% 0.02% 0.02% 0.02% 0.02% 0.02% 0.02% 0.02% 99.54% 100.00%
4,999.00 4,998.00 4,997.00 4,996.00 4,995.00 4,994.00 4,993.00 4,992.00 4,991.00 4,990.00 4,989.00 4,988.00 4,987.00 4,986.00 4,985.00 4,984.00 4,983.00 4,982.00 4,981.00 4,980.00 4,979.00 4,978.00 4,977.00 0
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The following table illustrates the tentative profit payment for the interim period and for the TFC 1 and TFC 2 commencing from the Issue Date:
TFC 1
Profit Payment Interim First Second Third Fourth Fifth Sixth Seventh Eighth Ninth Tenth Eleventh Twelfth Thirteenth & final Profit Period From To Interim Period (Date of Investment until the Issue Date) March16, 2013 April 16, 2013 May 16, 2013 June 16, 2013 July 16, 2013 August 16, 2013 Sep 16, 2013 Oct 16, 2013 Nov 16, 2013 Dec 16, 2013 Jan 16, 2014 Feb 16, 2014 March 16, 2014 April15th, 2013 May 15, 2013 June 15, 2013 July 15, 2013 August 15, 2013 Sep 15, 2013 Oct 15, 2013 Nov 15, 2013 Dec 15, 2013 Jan 15, 2014 Feb 15, 2014 March 15, 2014 April 15, 2014 Profit Payment Date March 15, 2013 April 15th, 2013 May 15, 2013 June 15, 2013 July 15, 2013 August 15, 2013 Sep 15, 2013 Oct15, 2013 Nov 15, 2013 Dec 15, 2013 Jan 15, 2014 Feb 15, 2014 March 15, 2014 April 15, 2014
TFC 2 Profit Payment Interim First Second Third Fourth Fifth Sixth Seventh Eighth Ninth Tenth Eleventh Twelfth Thirteenth Fourteenth Fifteenth Sixteenth Seventeenth Eighteenth Nineteenth Twentieth Twenty-First Twenty-Second Twenty-Third Twenty-Fourth & final Profit Period From To Interim Period (Date of Investment until the Issue Date) March 16, 2013 April 16, 2013 May 16, 2013 June 16, 2013 July 16, 2013 August 16, 2013 Sep 16, 2013 Oct 16, 2013 Nov 16, 2013 Dec 16, 2013 Jan 16, 2014 Feb 16, 2014 March 16, 2014 April 16, 2014 May 16, 2014 June 16, 2014 July 16, 2014 August 16, 2014 Sep 16, 2014 Oct 16, 2014 Nov 16, 2014 Dec 16, 2014 Jan 16, 2015 Feb 16, 2015 April 15, 2013 May 15, 2013 June 15, 2013 July 15, 2013 August 15, 2013 Sep 15, 2013 Oct 15, 2013 Nov 15, 2013 Dec 15, 2013 Jan 15, 2014 Feb 15, 2014 March 15, 2014 April 15, 2014 May 15, 2014 June 15, 2014 July 15, 2014 August 15, 2014 Sep 15, 2014 Oct 15, 2014 Nov 15, 2014 Dec 15, 2014 Jan 15, 2015 Feb 15, 2015 March 15, 2015 Profit Payment Date March 15, 2013 April 15, 2013 May 15, 2013 June 15, 2013 July 15, 2013 August 15, 2013 Sep 15, 2013 Oct 15, 2013 Nov 15, 2013 Dec 15, 2013 Jan 15, 2014 Feb 15, 2014 March 15, 2014 April 15, 2014 May 15, 2014 June 15, 2014 July 15, 2014 August 15, 2014 Sep 15, 2014 Oct 15, 2014 Nov 15, 2014 Dec 15, 2014 Jan 15, 2015 Feb 15, 2015 March 15, 2015
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2.14.1. Mode of Payment of Redemption Amount The Redemption Amount shall be paid by the Issuer to the TFC Holders either by way of a crossed cheque, pay order or by direct credit in the TFC holders bank account maintained with any bank in Pakistan including Easypaisa on the basis of the mode of payment elected by the Investor in the TFC Subscription Application. In the event the TFC Holder elects for payment by way of a cheque or pay order then such payment instrument shall be dispatched to the mailing address of the registered TFC Holder as on each Redemption Date. 2.14.2. Profit The Face Value of each TFC shall accrue profit from the Date of Investment at the fixed profit rate applicable to TFC 1 and TFC 2. The profit rates applicable to the TFCs are as follows: TFC 1 Profit Rate (Fixed Rate) 12.00% p.a. TFC 2 12.50% p.a.
2.15.
CALL AND PUT OPTIONS
2.15.1. Call Option (Early Redemption at Issuers Option) The TFCs are subject to an early redemption option, at any time prior to the final Redemption Date, at the option of the Issuer, in respect of the total Face Value of the Issue (Call Option), subject to the fulfillment of the following conditions: the Issuer has issued a notice in writing to the Trustee at least fifteen (15) days before the proposed date of exercise of the Call `Option and such proposed date falls on a Redemption Date; upon exercise of the Call Option the Issuer shall be obliged to make payment of the entire Outstanding Face Value in respect of the relevant TFC plus a Call Option premium calculated at the rate of 1% of Outstanding Face Value. In case of any dispute as to the amount payable against any TFC, the determination of the Trustee in this regard, save for manifest error, shall be final and binding on the Issuer and the respective TFC Holders; the Issuer shall not be entitled to redeem the TFCs before their stipulated maturity except in accordance with the terms hereof; no TFC redeemed in exercise of the Call Option may subsequently be re-issued nor any of the TFC Holders shall be obliged to purchase back any of such redeemed TFCs; and the Call Option may be exercised by the Issuer to redeem the TFCs.
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2.15.2. Put Option (Redemption Prior to Final Redemption Date) The TFCs are subject to an early redemption option exercisable at any time prior to the final Redemption Date, at the option of the TFC Holder, either in respect of the total or partial Face Value of the Issue (Put Option), upon the occurrence of the Trigger Event subject to the fulfillment of the following conditions: In the event Telenor divests its shareholding in the Issuer and / or the Issuer has knowledge that Telenor intends to divest its shareholding in the Issuer, which would result in Telenor being less than 51% shareholder in the Issuer, then the Issuer shall immediately inform the Trustee, Karachi Stock Exchange and TFC holders of the same (Trigger Event). The following conditions shall be applicable to the Put Option: the TFC Holder exercising the Put Option issues fifteen (15) days prior notice (Put Option Notice); the option is exercised in respect of TFCs having an aggregate Face Value of PKR 5000 or in multiples thereof; a Put Option premium calculated at the rate of 1% of the Outstanding Face Value shall be paid by the Issuer to the TFC Holders exercising the Put Option. In case of TFCs held in CDC, TFC holders can exercise the Put Option as per the central Depositary Company of Pakistan Limited Regulations under Section 5.5B (www.cdcpakistan.com); and TFCs applied for redemption will not be tradable in the secondary market. In case of physical certificates the investor will have to surrender the certificates along with the redemption notice. TFCs held in CDC will be cancelled when the redemption notice is received by the company. 2.16. REDEMPTION RESERVE
No Redemption Reserve is being created for the redemption of the TFCs. In view of the projected cash flows of the Issuer and the fact that the redemption amounts in respect of the TFCs are partially guaranteed by the SBP BSC and the good credit rating of the TFCs i.e Single A for both TFCs , the Issuer is expected to have adequate funds to meet its financial obligations arising from the Issue. 2.17. ZAKAT AND TAXES 2.17.1. Zakat
Zakat is deductible in case of TFCs held by Muslim citizens of Pakistan, except where a statutory declaration of exemption is filed, and in case of certain non-corporate entities such as Trusts, Funds (subject to being qualified for non-deduction of Zakat in terms of the Zakat and Ushr Ordinance, 1980) etc. Zakat shall be deducted at the time of redemption of the principal amount of the TFCs or on the market value based on the closing rate on the KSE on the first day of Ramzan, whichever is lower, at the rate of 2.50% on such dates as the concerned TFC becomes due for redemption in a Zakat year.
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2.17.2. Income Tax Any income derived from the Term Finance Certificates shall be subject to income tax in accordance with the applicable provisions of the Income Tax Ordinance, 2001 (Tax Ordinance). Tax shall be deducted @ 10% of the gross amount of profit paid, as per the First Schedule, Part 3, Division 1, Para (a) of the Tax Ordinance and shall be deemed to be the final discharge of tax liability on the profit arising to a tax payer other than a company, under subsection 3 of Section 151 of the Income Tax Ordinance. 2.17.3. Withholding Tax In terms of Clause 59, part (IV), Second Schedule of the Tax Ordinance, the Issuer is required to withhold tax, currently at the rate of 10%, from profit payments to all investors except companies and resident individuals whose investment amount is up to PKR 150,000.
2.17.4. Capital Gains Tax Any capital gains derived from the sale of Term Finance Certificates shall be subject to Capital Gains Tax in accordance with the Income Tax Ordinance 2001. 2.17.5. Withholding Tax on Sale and Purchase of TFCs Withholding Tax (WHT) of 0.01% will be charged on the sale/purchase of all shares, Modaraba certificates, and instruments of redeemable capital as defined in the Companies Ordinance, 1984. 2.18. MARKET MAKING
In accordance with the Regulations Governing Market Makers of Karachi Stock Exchange Limited (Market Maker Regulations), JS Global Capital Limited has been appointed and shall act as the market maker for the Issue in accordance with the Market Maker Regulations (Market Maker). The role of the Market Maker shall be to offer bid and ask quotes in the debt market security of the issuer on daily basis during trading hours of the Exchange with the maximum spread of 2.5%(Spread Limit) till complete redemption of debt market security. Price shall be determined by the Market Maker based on the prevailing liquidity, interest rates and credit risk of the Issuer. 2.19. DEFERRED TAXATION
Deferred tax is provided using the Balance Sheet method, providing for all temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for taxation purposes. Deferred tax is measured at the tax rates that are expected to be applied to the temporary differences when they reverse, based on the laws that have been enacted or substantively enacted by the reporting date. A deferred tax asset is recognized only to the extent that it is probable that future taxable profits will be available against which the assets can be utilized. Deferred tax assets are reduced to the extent that is no longer probable that the related tax benefit will be realized.
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The balance of deferred asset liability as at December 31, 2011 is PKR 213.886 million. Break up is as follows:
Amount in000
DEFERRED TAX ASSET - net Deductible temporary differences arising in respect of:
2011
2010
Carry forward tax losses Provision against non-performing loans and advances Deferred grant Deficit on revaluation of assets Taxable temporary differences arising in respect of:
232,903 5,644 6,174 10 244,731
293,905 17,678 9,725 156 321,464
Accelerated depreciation allowance Unrealized gain on derivative financial instrument
(22,560) (8,285) (30,845)
(11,167) (21,092) (32,259)
213,886
289,205
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PART III 3. COMMISSION, BROKERAGE AND OTHER EXPENSES OF THE ISSUE 3.1. COMMISSION TO BANKERS TO THE ISSUE
An overall commission at a maximum rate of 1.6% of the amount collected, in respect of accepted applications will be paid to the Bankers to the Issue for services to be rendered by them in connection with the public offer. 3.2. BROKERAGE
The Issuer shall pay a brokerage fee in respect of the IPO to the members of KSE, LSE and ISE at the rate of 0.25% of the value of TFCs actually sold through them. 3.3. EXPENSES OF THE ISSUE The initial expenses of the Issue paid or payable by the Issuer, inclusive of all commissions are estimated to be PKR 63,197,500 (Initial Issue Expenses). The details of the Initial Issue Expenses are as follows: Expenses Category Commission to Bankers to the Issue* Advisory Expenses Brokerage to the members of Stock Exchanges Stamp Duty Sindh Rating Fee Initial Initial Listing Fee of the Karachi Stock Exchange Processing Fee of the Securities & Exchange Commission of Pakistan Annual Listing Fee of the Karachi Stock Exchange CDC Fee Trustee Fee Registrar Fee Printing & Publication Expenses of Prospectus Print Marketing Electronic Marketing 5,000,000 25,000,000 0.25% 0.05% Rate Amount in PKR* 16,000,000 10,000,000 2,500,000 500,000 600,000 500,000 100,000 80,000 67,500 250,000 500,000 1,000,000
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Legal Expenses Out of Pocket Expenses Total

*Represents maximum Expense related to the Issue
1,000,000 100,000 63,197,500
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PART IV 4. HISTORY AND PROSPECTS 4.1. Background and History of the Issuer
The Issuer is a Microfinance Bank incorporated in August 2005 under the Companies Ordinance 1984and licensed by the State Bank of Pakistan in 2005 under the Microfinance Ordinance, to provide organizational, financial and infrastructural support to poor persons, thereby mitigating poverty and promoting social welfare and economic justice through community building and social mobilization and to provide for matters connected therewith or ancillary thereto. The Issuer aspires to contribute to the economic prosperity of Pakistan by providing low cost microfinance banking services across the less developed areas of Pakistan through a wide array of banking services (loans, savings and insurance) to the under-served and un-banked market of the country. At present, the Issuer is providing banking services to a wide range of low-income, selfemployed and entrepreneurial section of the society through a variety of financial products designed to assist the growth of businesses and produce significant economic multiplier effects on the economy of Pakistan. The Issuer has 104 business locations in both Sindh and Punjab (as of June2012), with over 144,850active accounts as at June2012 and has extended over 435,963 loans up to June2012, since its inception. Of the active accounts, close to 34% are women borrowers, which is one of the highest percentages amongst microfinance banks in Pakistan. Shareholding Structure In December 2008 Telenor acquired 51% of the Issuers share capital. As of December 2011 the shareholding structure of the Issuer is as follows: Shareholding Breakdown as of December 31, 2011 Shareholder Telenor Pakistan Emerging Markets Consulting Limited Centurion Limited International Finance Corporation Other Individuals Total
*Source: Annual Audited Accounts 2011 of Tameer Micro Finance Bank Limited
% Shareholding 51.0 29.4 7.4 4.9 7.3 100.0
The Issuer and Telenor Pakistan have jointly launched the first ever Cellular Phone Banking / Branchless Banking in Pakistan, using Telenors Cellular Phone network and GPRS POS technology. The Issuer aims to introduce to the Pakistani market efficient, highly secure and instant financial products such as mobile wallets, utility bill payments and cash deposit and withdrawal services in their mobile-commerce initiative. After the launch of their joint Easypaisa program in 2009, the Issuer has moved to the forefront of Branchless Banking in Pakistan and the year 2011, the Issuer has collected more than 15.3 million utility bills and over PKR 26 billion of domestic remittances.
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4.2. 4.2.1.
PROSPECTS
Principal Microfinance Loan Products
In its core branch banking, the Issuer has been steadily focusing on cautious expansion into the Microfinance market. With portfolio growing at a 3 year CAGR of 49% and deposits at 62%%, the bank will achieve scale with profitability through the introduction of several efficiency and productivity initiatives. Description Outstanding Portfolio(000) CAGR- Portfolio Deposits(000) CAGR-Deposits 2011 5,054,297 49% 5,405,031 62% 2009 1,513,247
1,267,829
The Issuers goal of poverty elimination, sustainable development and economic empowerment are made possible by building a viable business model that meets the total banking needs of an individual, their house hold unit, their business and sources of earning and the community at large. The four most popular products of the Issuer are as follows: Tameer Karobar Loan This loan provides working capital for Microfinance entrepreneurs for growing their business unit and provides critical cash flows necessary for keeping Micro sector businesses above the poverty line. The average loan size is PKR 30,000 and is targeted towards small shopkeepers, traders and business owners. A loan of this kind is currently not offered by general competition. Tameer Housing Loan Tameer Housing Loan was launched in May 2008 to cater for the diverse needs of Micro sector customers ranging from seasonal crop financing, purchasing shop inventory to buying of machinery and tools for business use. The loan is secured by the deed of a house and has an average loan size of PKR 150,000. Tameer Emergency Loan Emergency offers potential customers an opportunity to borrow funds in a time of distress against assets owned by them. These assets may be in the form of government securities, term deposits, and gold jewelry. So, instead of selling or terminating the hard-earned assets which usually appreciate with time, the customer can rather momentarily pledge those assets to meet their short-term or mid-term needs. The Issuer uses specialized jewelers to verify the jewellery/gold before loan disbursement. The collateral is kept in a sealed packet in secured vaults. Emergency proved a great success and constitutes 78% of all new disbursements. The average loan size is PKR 65,000. Tameer Group Loan The Issuer provides Group loans to men and women in both urban and rural areas with easy loan qualifying terms as the social collateral (group-lending) and relationship quality is made more reliable and more productive for the customer as well as more risk efficient for the Issuer. The Issuer has so far introduced Group Lending with groups of 5 only and verifies the
e-CIB and CNIC of all borrowers in the group. The average loan size is PKR 15,000. Tameer Group Loan is offered in three variants i.e. General (EMI based), Women (EMI based) & agriculture (bullet).
The below table illustrates the disbursement and outstanding portfolio for Loan Products as of June 2012: Products Disbursal As of June Portfolio As of June 2012 2012 Rs in 000 4,635,037 458,178 Tameer Karobar Loan 416,784 164,501 Tameer Housing Loan 5,203,066 Tameer Emergency 13,501,378 Loan 1,944,771 352,916 Tameer Group Loan
4.2.2.
Core Bank Loan Programme
While Tameer Karobar Loan and Tameer Group Loan remained the primary revenue earners for the Issuer, portfolio growth came from the gold-secured Tameer Emergency Loan (TEL) which today stands at almost 80% of the portfolio. This high concentration in secured loans is expected to dilute overall yields. Future plan maintains this trend as a strategic choice to ensure low infection in portfolio. Gross advances as at 31 December 2011 stood at > Rs. 5 billion, which is expected to double by the end of 2013. Gold secured TEL shall form the catalyst to growth, crossing PKR 6,000 million by 2012. The Issuer would also be focusing on the challenge of expanding its portfolio in Tameer Group Loan and Tameer Karobar Loan, both of which being in the form of equal monthly installment based loans have high repayments and hence high turnover. Historically the Issuer has maintained an average retention ratio of less than 15% on unsecured lending till December 2010. Through careful analysis and operational risk adjusted process changes, this is increased to 30% during 2011 to funnel future growth. The Issuer has largely kept its portfolio prices stable since 2008 despite increasing cost of funds resulting from the pressure on the risk free rate. TEL price has been phased over the year to prevent any breakage in sale momentum. 4.2.3. Branchless Banking
While Core Microfinance Banking remains an integral part of the Issuers operations, branchless banking now forms a vital element for future growth and strategic positioning for the Issuer. Customers with m-wallet accounts on Easypaisa have outstripped the customer base acquired by the Issuer in 5 years through conventional channels. With over 15,500 signed agents, Easypaisa is the largest consumer bank offering in Pakistan today in terms of number of touch points. The Bank along with Telenor plans to expand the Easypaisa network to 19,000 agents by end of 2012. Easypaisa represents one of the Banks most vital strengths since it enables it to offer its expanding stable of products to customers all over the country with relatively little investment, taking advantage of Telenors excellent agent network infrastructure. The Bank intends to effectively leverage the said agent network and its M wallet offering to develop a base which can help raise low cost mass deposits.
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4.2.4.
Geographic Expansion
The Issuer feels that through innovative use of new channels, there is considerable room to leverage the existing geographical footprint. Therefore, the plan envisages only a very limited increase in branches over the next four years but instead puts investment behind existing channel renovation, and low cost options like community centers and cheaper touch points like booths and branchless banking. The experience of the last five years has helped to rationalize the capacity model to attain a disbursement capacity of approximately Rs. 7 billion per annum. This has been supported by a distribution base of 104 points while maintaining a default of less than 1%. This is a rare accomplishment by any MFB in the market. It typically takes up to 12-18 months for a touch point to reach a level of optimum efficiency. Between 2009 and 2010, the Issuer almost doubled its branch loan disbursement capacity from PKR 4.60 million a month to PKR 10.00 million a month with the largest branch in Gujranwala achieving PKR 26.00 million a month. The Issuer feels that with support through ancillary channels, these branches can again double their capacity and are expected to reach PKR 15 million of disbursements a month. As before, the dependency will be on larger branches in Central Punjab to carry the bulk of the growth. The steady improvement in the revenue to expense ratio over the last 3 years is testimony to the fact that the management has been able to develop a scalable model. The management intends to scale up by expanding its Hub and Spoke distribution network. Through this, the bank has been able to achieve extensive geographic reach while remaining frugal in cost and resource deployment demonstrating a high level of efficiency. Out of the planned new touch points, 20% will be upgrades from Community Center to low cost Financial Center whereas the rest would constitute newly opened touch points. The increase in touch points will also provide greater opportunity to support the cash management in the field with better results to support the initiative of Bank on Wheels. The proposed touch points if deployed during 2012 will help to build the disbursals volumes in 2013 and 2014, as these touch points will reach their optimum performance level in 12-18 months. In parallel, the deposit generation is expected to pick up due to specialization of branches/ Financial Centers in deposit. The distribution strategy will achieve its optimum efficiency in 12-18 months while affording gradual deployment of capital to retain the positive equation of revenue to expense ratio. 4.2.5. Management of Delinquencies
The Issuer has invested heavily in technology infrastructure as it forms the backbone in maintaining a control over loan disbursements and repayments despite losing geographical proximity. Strong focus on technology, as well as internal controls in credit approvals and portfolio performance reviews, has consistently helped in maintaining the Issuers delinquencies in unsecured loans. The low delinquency number has been further cemented by the Issuers expansion into secured lending which now comprises the bulk of the portfolio. Thus, while the entire banking and microfinance sector is plagued with delinquencies that are increasing, the Issuer has managed to reduce and maintain delinquency level to around 1%. Year Portfolio At Risk 2008 1.33% 2009 1.20% 2010 0.47% 2011 0.69% 2012(June12) 1.24%
Onward maintenance at this level is a bigger challenge due to the recent floods and expected impact of inflationary pressure on the microfinance market. The role of the credit risk control function will have to be improved to provide better risk management as well as analysis of the data to allow predictive scoring. 4.2.6. Deposit Plan
A much bigger challenge to the Issuer today remains its ability to scale up in deposit generation. Pakistan has the lowest saving to GDP ratio in South Asia at 14.3% as compared to 18.2% in Sri Lanka, 32% in Bangladesh and 37% in India.1 However, this data is not a true depiction of the reality. Even now majority of the people in rural and semi urban areas save their money in a safe place in their home. Going forward the Issuer plans to take a number of initiatives to ramp up deposits. Three products form the cornerstone of the Issuers deposit strategy: Mahana Sukh Chain: at a monthly profit payment of 12.34% p.a., this product is targeted towards low income segment of the population. Through monthly profit payment on investment the product meets the regular business needs of the customer. Khas Bachat Certificate: targeted towards widows, and pensioners, the certificate gives an annual, back loaded return of 14% p.a. Launched recently, the product is expected to meet medium term saving needs of the market. Tameer Shajar: Targeted towards senior citizens, the certificate gives a monthly return on investment on competitive rates for 1, 2 & 3 years. All of these products have carried a comprehensive go-to-market strategy with deposit targets for sales team as well as advertising on local cable and mainstream channels. The experience of opening two 24 hour branches, one in Karachi Fish Harbor (KFH) and another in Karachi Sabzi Mandi has helped in deposit generation. The deposits from KFH branch after 15 months of operations stood at PKR 300 million, whereas SM branch had a deposit of approximately Rs. 100 million. Plans are expand penetration in other Mandis/commodity markets through installation of booths. Up until now, the Issuer has not hired dedicated deposit generation sales force in the branches to support the lending and collection teams but has relied on existing teams to generate liabilities. Given the deposit growth challenge for 2012 and beyond, there is a need to hire and develop a deposit specific sales force. The concept has been successfully piloted in 2011 and will be rolled out nationwide in a phased approach in 2012. Apart from improving small TDRs and saving accounts, the bank is also making an effort to increase current account mix within deposits. A substantial gain was due to the launch of clearing facility by the Issuer, as this was instrumental to offer a diverse range of transactional banking services to its account holders. With savings and current account constituting almost 50% of total deposits, the Issuer anticipates the cost of funds to remain steady under the prescribed target of 10-11% in the year 2012.
1
http://econ.worldbank.org/WBSITE/EXTERNAL/EXTDEC/0,,menuPK:476823~pagePK:64165236~p iPK:64165141~theSitePK:469372,00.html
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Overall, Tameer has a deposit base of about PKR 4.5 billion in deposits as of December 2011. 4.2.7. Access to Grants
The Issuer historically has been a recipient of grants from agencies like CGAP, DFID and Bill & Melinda (Gates Foundation) for initiating and managing its technology agenda. However, as the Issuer enters a stage in its existence where market development is the basis to achieving scale in core banking, it has broadened its partnerships to approach various agencies within and outside Pakistan to support it in generating deposits as well as support research and development for new product development. Recently, SBP had provided grant under the Financial Inclusive Program-2, after the successful completion of FIP-1 project, for the purpose of establishing a separate Treasury Function, Home Remittance Cell and for the Remittance Gateway Project. 4.3. Human Resource Program To ensure that the Bank maintains a skilled workforce while moving towards greater empowerment and leadership from within the ranks, extra emphasis has been placed on internal capacity building. The Bank is amongst the few institutions in the industry that have internally developed programs such as employee satisfaction surveys, medical awareness sessions and roll out of the organizations vision and mission through a structured plan. The Bank has also set up an in-house training department to manage internal orientation and both train new employees and ensure existing employees stay on top of their game covering technical training on Microfinance Banking and Core Banking Application, and soft skills. It is intended that the Bank will continue to invest in its Human Resource in order to support the planned growth in a sustainable manner. With high levels of growth and market based compensation, the Issuer has seen increased levels of manpower retention especially at junior management levels. In addition, the Issuers reputation of being an innovator has served to improve the quality of personnel attracted to and retained in management positions. HR is fully empowered and equipped to play an active and strategic role in the overall business process by designing HR systems and procedures which are aligned with the Issuers priorities and business objectives. 4.4. RISK FACTORS Prospective investors should carefully consider the risks and uncertainties described below, in addition to the other information contained in this Prospectus prior to making any investment decision relating to the TFCs. Additional risks and uncertainties not known to the Issuer or that the Issuer currently believes to be immaterial may also have an adverse effect on the business, financial condition and result of operations of the Issuer and the trading price of the TFCs which could consequently have an adverse impact on all or part of the Investors investment and / or the redemption amounts payable in terms of the TFCs. The financial and other related implications of the risks concerned, wherever quantifiable, have been disclosed in the risk factors, detailed below. Unless otherwise stated in the relevant risk factors set forth below, the Issuer is not in a position to specify or quantify the financial or other implications of any of the risks mentioned herein.
The ordering of the risk factors is intended to facilitate ease of reading and reference and the same does not in any manner indicate the importance of one risk factor over another. This Prospectus contains forward looking statements that involve risks and uncertainties. The Issuers actual results could differ materially from those anticipated in these forward looking statements as a result of several factors, including the considerations described below and elsewhere in this Prospectus. Investors are advised to read the following risk factors carefully before making an investment in the TFCs offered in the Issue. The Investors must rely on their own due diligence of the Issuer and the Issue, including the risks and uncertainties. BUSINESS RISKS 1. Credit Risk The Issuers core focus remains managing the credit risk of its microfinance business. However, entering a new and as yet untested business through Branchless Banking has introduced a fresh spectrum of risk parameters for the bank to monitor and evaluate its business growth on. Mitigants in respect of Credit Risk are as follows: In both cases, the Issuer benefits from its strong focus on technology and access to comprehensive MIS that allows for analytical reviews and stress tests. On the core microfinance side, the bank had a NPL to Gross portfolio ratio of 0.69% in the year 2011; Further, the Issuer will be focused on maintaining its defined system base and manual process controls for loan verification, disbursal and repayment leading to better span of control and reduced incidence of fraud and delinquency; Secured Emergency Loan constitutes about 80% of the portfolio; The Issuer has in place a regular process of conducting periodic stress tests on the portfolio to provide early warning on portfolio vulnerabilities; The Issuer plans to invest in its systems to implement a process for comprehensive statistical analytics of its portfolio along product, approver, market, demographic lines; In addition, the Issuer will continue to improve the stress test parameters to explore deeper into the data; and The Issuer will create a Credit Scoring Methodology based on historical data to better allow analysis and predictability of future lending portfolio.
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S.No NPL (000) NPL(% of Advances)
2008 12,028 1.33%
2009 18,412 1.2%
2010 14,613 0.48%
2011 34,761 0.69%
2012HY 77,495 1.24%
2. Operational Risk While the Issuer has low incidence of losses through operational risk, there is a need to develop a more formal process of identification and mitigating risk in this area. Mitigants in respect of Operational Risk are as follows: In 2010, the bank introduced an operational risk matrix to review its operational risks based on market environment and business factors. This was further finetuned in 2011; and In 2012, it is planned to enhance the matrix to evaluate across business lines i.e. in both Branch and Branchless Banking to ensure an optimal level of controls to limit operational losses and has been effectively implemented. 3. Market and Liquidity The Issuers market and liquidity risk is being managed by its Asset Liability Committee (ALCO)which meets periodically to review and manage these parameters. Historically, the Issuer has supported a conservative view limiting treasury investments to restricted institutions in the interbank market. Mitigants in respect of the Risks associated with Market and Liquidity are as follows: Periodic ALCO meetings are scheduled to gauge the entitys liquidity an d market risk; and The Issuer has developed a comprehensive risk and mitigant matrix to allow the bank to enter into more sophisticated capital market transactions. 4. Compliance / Legal / Regulatory The Issuers foray into Branchless Banking exposes it to compliance, legal and regulatory risk. To manage this, in 2009, the Issuer established an independent compliance function that reports to the CEO and is now enhanced to manage the above risks for the Issuer.
Mitigants in respect of Compliance, Legal and Regulatory Risks are as follows: Regulatory risk management framework is prepared and monitored on regular basis; With business complexity and sophistication increasing on Easypaisa, 2012 require the Compliance Function to spend more time ensuring business needs are being met in line with the regulatory requirements; and
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Anti-Money Laundering (AML) system is in place which has the ability to raise risk flags and exception risk. 5. Business Risk Mitigants
The overall mitigant to Business Risk is Self-Assessment. While the Issuer has an internally developed process for Self-Assessment at branch and department level, in 2011 this process will be rolled out again with more comprehensive training to the users, and regular monitoring at the central level so that its implementation is sustainable. INSTRUMENT RISK 1. Payment and Default Risk This risk is associated with the repayment capacity of the Issuer and the Issuers ability to service the principal (bullet) component of the redemption amount as well as the profit. Further since the TFCs will be repaid through a bullet payment at maturity, payment risk is largely weighted on those particular redemption dates. The Mitigants in respect of Payment and Default Risk are as follows: The Instrument has received rating of A by JCR-VIS Limited which depicts low probability of default; The redemption amounts payable by the Issuer have been partially guaranteed by the MCGF Guarantee to the extent of 40% of the principal component of the redemption amount due and payable by the Issuer; and Furthermore, 80% of Issuers loan portfolio is backed by gold collateral and delinquency ratio has been maintained around 1% indicating low payment/default risk. 2. Liquidity Risk By investing in the TFC the investor assumes the risk of not being able to sell the TFC without adversely affecting the price of the instrument.
Mitigants associated with Liquidity Risk are as follows: The TFCs are to be listed on KSE, which will act as provider of liquidity for TFCs during the life of the instrument by facilitating secondary market trades. In addition, the market maker, JS Global (for details about the market maker please refer to para 2.18 of the prospectus) would also provide liquidity for secondary trading of the Issue. 3. Interest Rate or Price Risk The TFC issue will be listed on KSE and the TFC holders of the Issuer will be able to sell or buy TFCs through the members of KSE and through market makers subsequent to the listing of the issue. Price of TFCs will depend on the TFC market behavior and the performance of
the Issuer. Hence price may rise or fall and result in increase or decrease in the value of TFCs to any extent. Fluctuations in interest rates, and underlying inflation, may adversely affect the yield to investors.
The Mitigants for the Interest Rate Risk are as follows: The TFCs are to be listed on the KSE and can be traded in the secondary market. In addition, the market makers would also provide liquidity for secondary trading of the Issue.
4. Financial Projection Risk The Issuer has prepared financial projections on the basis of various assumptions related to market conditions and is subject to change. Any unforeseen events such as problems arising out of lower than projected portfolio growth has not been taken into account. The investors assume the risk that due to the unforeseen events the Issuer may not be able to maintain consistent growth. 5. Changes in Tax Regime Any adverse change in the existing Tax regime for investment in TFCs, may affect the redemption and profit for the TFC investors. 6. Regulatory Risk Changes in the regulatory framework may have an effect on the returns to investors in so far as such changes impact the return on TFCs.
Mitigants in respect of Regulatory Risk are as follows: As these are fixed rate instruments this risk is expected to be minimal. 7. Exchange Rate Risk Depreciation of the Pakistani Rupee may affect the yield to overseas investors. 8. Security Risk The Issue will be secured partially through the Microfinance Credit Guarantee Facility, provided by the State Bank of Pakistan. Through this facility, each TFC 1 and TFC 2 are guaranteed up to the extent of 40% of the outstanding principal component of the Redemption Amount as on the date of event of default by the Bank ( For details please refer to paragraph 6.1.1). The investors may however note that both TFC1 and TFC2 are unsecured to the extent of 60% of the principal component of the outstanding Obligation and 100% of the profit due and payable by the Issuer in respect of each class of TFCs, as on the date of occurrence of the Event of Default by the bank. Mitigants in respect of Security Risk are as follows: The MCGF Guarantees, guarantee the payment of 40% of the Obligations, due and payable by the Issuer as on the date of occurrence of the default; this is a payment
guaranteed by the Guarantor and shall be made within five (5) Business Days from the date of receipt of a Guarantee claim from the TFC holders, without the requirement of initiating any legal action and / or filing a claim in the courts for recovering the guaranteed amount; As compared to other forms of security which require an enforcement of the security and thereafter the distribution of the proceeds recovered from the liquidation of the security, which is a time consuming process, and also involves a certain degree of risk. However, with the MCGF Guarantees not only is 40% of the principal amount guaranteed but it is also payable within five (5) days from the date of filing the claim by trustee with the SBP BSC, subject to a claim having been filed with SBP BSC after ninety (90) days from the date of default. Accordingly as compared to other forms of security, the MCGF Guarantees guarantee a specified amount and the time of payment of such amount; The Trustee has the right to take the actions specified in sub-section 9.4.2 of the Declaration of Trust to recover the balance amount (as set out in sub-paragraph 7.3.1.5 for ease of reference).
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PART V FINANCIAL INFORMATION AND CREDIT RATING REPORT 5.1. AUDITORS REPORT DATED APRIL 3, 2012 UNDER SECTION 53(1) READ WITH CLAUSE 28(1) OF SECTION 2 OF PART 1 OF THE SECOND SCHEDULE OF THE ORDINANCE.
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5.2.
AUDITORS CERTFICATE FOR BREAK UP VALUE OF SHARES.
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5.3.
AUDITORS CERTIFICATE ON ISSUED, SUBSCRIBED AND PAID UP CAPITAL.
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5.4.
INTERIM CONDENSED FINANCIAL STATEMENTS FOR THE HALF YEAR ENDED JUNE 30, 2012
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5.5.
FINANCIAL SUMMARY :
FINANCIAL SUMMARY 2009 2,789,009 1,663,857 1,346,939 343,469 (616,026) 1,074,382 439,691 (351,296) (119,436) (2543) 8.4 (0.1) 2010 Rs on 000 5,279,100 3,927,848 1,346,939 405,812 (428,997) 1,323,754 753,406 (181,769) 7,067 249,372 10.1 1.9 2011 8,281,106 6,805,261 1,346,939 439,430 (328,145) 1,458,224 1,277,002 (445,874) 226,721 134,470 11 1
Total Assets Total Liabilities Share Capital Reserves Accumulated Profit/Loss Total Equity Mark-up Interest Income Mark-up Income Expense Profit Before Tax Profit/Loss After Tax Breakup Value Per Share Earnings/Loss Per Share Ratio Analysis Return on Assets Return on Equity Advances to Deposits Financial Leverage Ratio CAR
(4%) (11%) 1.19 0.28 61%
0.13% 1% 1.03 0.5 39%
3% 16% 1.12 1.23 60%
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[PAGE INTENTIONALLY LEFT BLANK]
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5.6. CREDIT RATING REPORT The Credit Report in respect of the Issue is attached hereinbelow.
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PART VI
6. TRUSTEE AND SECURITY 6.1.

6.1.1.
SECURITY MCGF Guarantee
Each class of TFCs is partially secured by way of MCGF Guarantees issued by the SBP BSC, vide letter No: DFSD-MCGF (IGI)/492/2012, dated 25th September, 2012; under the MCGF Guidelines, guaranteeing forty percent (40%) of the principal component of the Redemption Amount due and payable by the Issuer in respect of TFC 1 and TFC 2, upon the occurrence of Event of Default under TFC 1 and TFC 2 (Guaranteed Obligations). The MCGF Guarantees shall come into effect on the Issue Date and shall remain valid and in force during the entire term of the relevant class of TFCs. The MCGF Guarantees have been issued by the SBP BSC in favour of the Trustee and pursuant to the Declaration of Trust, the Trustee has confirmed that the Trustee holds the benefit of (a) the MCGF Guarantee issued by SBP BSC to secure TFC 1, in trust for and for the benefit of TFC Holders holding TFCs 1; and the MCGF Guarantee issued by SBP BSC to secure TFC 2, in trust for and for the benefit of TFC Holders holding TFCs 2. Upon the failure of the Issuer to effect payment of the amounts outstanding in respect of TFCs 1 and / or TFCs 2, the Trustee has the right to take the actions as set out in Paragraph 7.2.5 (Enforcement Upon Event of Default), and to serve a claim upon the Guarantor for payment of the Guaranteed Obligations under the MCGF Guarantees, in accordance with the MCGF Guidelines. The Trustee also has the right to recover the Obligations by taking any or all of the following actions against the Issuer: to file suits for the recovery of the Obligations, including with obligation for the appointment of receivers and prompt attachment of all movable and immovable properties of the Issuer; to file suits for the recovery of the Obligations and / or for any shortfall after the enforcement of the Guarantee; to apply for the winding up of the Issuer in accordance with applicable provisions of Law.
The term Obligations has the same meaning as ascribed thereto in the Declaration of Trust, and is reproduced below for ease of reference. Obligations means the obligation of the Issuer to redeem the TFCs on the Redemption Dates by payment of the Redemption Amounts to the TFC Holders and comprises of: the amount which is outstanding and payable to the TFC Holders in respect of the TFCs at any time during the term of the Declaration of Trust and includes all other amounts payable under the Declaration of Trust, the TFCs and the Transaction Documents; and
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upon the occurrence of Events of Default, means the obligation of the Issuer to pay to the Trustee for the benefit of the TFC Holders, or directly to the TFC Holders, as the case may be, all amounts due and payable as on such date, including but not restricted to the following: the Redemption Amounts due and remaining unpaid as on such date as set out in the Redemption Schedule; the Redemption Amounts accrued and remaining unpaid as on such date as set out in the Redemption Schedule; the Outstanding Face Value as set out in the relevant Redemption Schedule in respect of all future Redemption Dates; and all other amounts payable to the Trustee and / or the TFC Holders pursuant to the Declaration and the Transaction Documents in respect of the TFC Issue. 6.2 TRUSTEE
In order to safeguard the interests of the TFC holders, IGI Investment Company Limited has been appointed to act as Trustee for the issue. The Issuer shall pay to IGI Investment Company Limited a trustee fee of PKR 700,000 per annum. The fee shall be payable at the beginning of each year commencing from the date of signing of the Trust Deed and on each subsequent anniversary thereof. The Bankers to the Issue have been instructed to inform the Trustee on a daily basis of the subscriptions received for issuance of TFCs. As per the terms of the Declaration of Trust executed between Tameer and the Trustee, the Trustee will ensure the following: The terms and conditions of the Declaration of Trust and Security Documents are adhered to; and The interests of the TFC holders are safeguarded by taking the actions that it deems necessary (as prescribed by the Declaration of Trust) in the event of any breach of terms and conditions of TFC Instrument and the Declaration of Trust by Tameer Microfinance Bank Ltd. 6.3. THE TRUST DEED
The Trust Deed dated June 6th, 2012 (Declaration of Trust) executed between the Company and IGI Investment Company Limited specifies the rights and obligations of the Trustee. In the event of Issuer defaulting on any of its obligations under the terms of the Declaration of Trust, the Trustee may enforce Issuers obligations in accordance with the terms of the Trust Deed. The proceeds of any such enforcement shall be distributed to the TFC Holders at the time in proportion to the amounts owed to each TFC holder pursuant to the TFCs. 6.4. EVENTS OF DEFAULT AND SECURITY ENFORCEMENT PROCEDURE
The event of default will be governed under Article 8.1. of the Declaration of Trust executed between the Company and the Trustee to the Issue. It is clarified, however, that in the event of default, the TFC holders acting through the Trustee shall be entitled to initiate legal
proceedings against the Company for recovery of the outstanding amount payable under the TFCs in case the Company fails to cure the event of default in terms of the Declaration of Trust. The Obligations shall become immediately due and payable, and the Security shall become immediately enforceable by a declaration of the Trustee, notified to the Issuer, upon the occurrence of an Event of Default in case the Company fails to cure the event of default in terms of the Declaration of Trust. Under the Declaration of Trust, each of the following events constitutes an Event of Default: (a) the failure of the Issuer to: (i) redeem any Coupon on its respective Redemption Date and to pay the Redemption Amount and / or any portion thereof on such Redemption Date; or (ii)pay any amounts payable by the Issuer under this Declaration and such failure continues for a period of three (3) consecutive Business Days irrespective of whether or not a demand for the payment of the same has been made upon the Issuer; or (iii) make payments of the Redemption Amount and all other amounts including amounts for early redemption of TFCs) during each Collection Period in accordance with the Amended and Restated Collection Agreement; (b) default by the Issuer in the performance or observance of or compliance with any of its other material obligations or undertakings under the TFC Transaction Documents and such default (other than as specified in sub-clause (a) above) continues for a period of thirty (30) days from the date of receipt of notice by the Issuer from the TFC Trustee in respect of the same;
(c) an event of default (howsoever described and / or defined) occurs under a TFC Transaction Document and such event of default (other than as specified in subclause (a) above) continues for a period of thirty (30) days from the date of receipt of notice by the Issuer from the TFC Trustee in respect of the same;
(d) any representation or warranty made or deemed to be made or repeated by the Issuer in or pursuant to this Declaration is found to be incorrect and / or misleading; (e) the Issuer enters assigns or enters into an arrangement for the benefit of its creditors in respect of any Financial Indebtedness, which has a Material Adverse Effect in the reasonable opinion of TFC Trustee; (f) the Issuer: (i) voluntarily or involuntarily becomes the subject of bankruptcy or insolvency proceedings except for proceedings which are frivolous in nature; and / or elects to become a party to or is subject to any proceedings or procedure under any law for the relief of financially distressed debtors, except for proceedings which are frivolous in nature; and or admits in writing its inability to pay its debts as they mature, to the TFC Trustee; and or a receiver or an administrator is appointed for all or any part of its assets or business;
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(ii)
(iii)
(iv)
(g) the Issuer is unable or admits its inability to meet its payment obligations in respect of its Financial Indebtedness as the same fall due, suspends making payments on any of its Financial Indebtedness or, by reason of actual or anticipated financial difficulties, commences negotiations with one or more of its creditors with a view to rescheduling its Financial Indebtedness or any portion thereof; (h) a moratorium is declared in respect of any Financial Indebtedness of the Issuer; (i) any corporate action, legal proceedings or other procedure or steps are taken in relation to the suspension of payments, winding-up, dissolution, administration or reorganization (by way of voluntary arrangement, scheme of arrangement or otherwise) of the Issuer other than a solvent liquidation or reorganization; (j) the Issuer enters into or initiates steps for entering into a composition, compromise, assignment or arrangement with any of its creditor; (i) the appointment of a liquidator, receiver, administrative receiver, administrator, compulsory manager or other similar officer in respect of the Issuer (if applicable) or any of its assets; (j) enforcement of any Security Interest over substantial assets of the Issuer, which has a Material Adverse Effect in the reasonable opinion of the TFC Trustee; (k) any governmental agency nationalizes, acquires or expropriates (with or without compensation) any or all the assets of the Issuer including but not restricted to the Secured Properties; (l) any other event or circumstance arising out of the Issuers negli gence or default which results in a Material Adverse Effect in the reasonable opinion of the TFC Trustee; (m) any Financial Indebtedness of the Issuer is declared to be or otherwise becomes due and payable prior to its specified maturity as a result of an event of default (howsoever described), which has a Material Adverse Effect in the reasonable opinion of the TFC Trustee; (n) any commitment for any Financial Indebtedness of the Issuer is cancelled or suspended by a creditor of the Issuer, as a result of an event of default(however described), which has a Material Adverse Effect in the reasonable opinion of the TFC Trustee; (o) it is or becomes unlawful for the Issuer to perform any of its material obligations under this Declaration; (p) any obligation or obligations of the Issuer under this Declaration or any TFC Transaction Document are not, or cease to be, legal, valid, binding or enforceable and the cessation individually or cumulatively has a Material Adverse Effect in the reasonable opinion of the TFC Trustee; (q) this Declaration and / or any TFC Transaction Document ceases to be in full force and effect; (r) the Issuer repudiates this Declaration or evidences an intention to repudiate this Declaration;
(s) any Security Document ceases to be in full force and effect or is declared to be void or is repudiated and the conditions resulting in the repudiation are not remedied and / or replacement Security Documents are not executed within a period of fifteen (15) days from the date on which the Security Documents become void and /or are repudiated; (t) any court or arbitrator passes a final non-appealable judgment or arbitral award for payment, against the Issuer and the Issuer fails to effect such payment within sixty (60) days from the date on which the obligation to pay arises; (u) the Issuer fails to comply with any law or regulation to which it may be subject and the same has a Material Adverse Effect in the reasonable pinion of the TFC Trustee; (v) the Issuer fails to comply with the covenants set out in this Declaration and such failure continues for a period of thirty (30) days from the date of receipt of a notice by the Issuer from the TFC Trustee in respect of the same or from the date on which the Issuer has knowledge of the same, whichever is earlier; (w) the Issuer suspends, ceases, or threatens to suspend or cease, to carry on all or a substantial part of its business or to change the nature of its business from that undertaken at the date of this Declaration; (x) any event or series of events (whether related or not) occurs which would have a Material Adverse Effect in the reasonable opinion of the TFC Trustee.
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PART VII 7. MANAGEMENT OF THE COMPANY 7.1. BOARD OF DIRECTORS OF TAMEER MICROFINANCE BANK LTD.
At present, the Board of the Issuer consists of 7 Directors. The affairs of the Issuer are governed by a Board of Directors, which currently consists of the Chief Executive Officer (CEO), The Group Chief Financial Officer (CFO) and six other Directors. The CEO has an overall responsibility to manage the day to day operations of the Issuer. S. No DIRECTOR Designation ADDRESS DIRECTORSHIP HELD IN OTHER COMPANIES
Jon Eddy Abdullah
Director/Chair man
House no. 39/207, Nichada Thani, Samakee Road, Pakkred, Nonthaburi 11120, Thailand Tameer Microfinance Bank Limited A15, Block 7/8, KCHS Union, Karachi, Pakistan House No. 24 A, Street 27, F-6/2, Islamabad F-65, Block 7, Clifton, Karachi
Nadeem Hussain
President & C.E.O/Director
Minhal Private Limited
Roar Bjaerum
Director
Nizar Noor Muhammad
Director
Eastern Garments (Private) Limited Sterling Creations (Private) Limited Rockrete (Private) Limited Eastern Holding (Private) Limited Synergy Textile Mills (Private) Limited -
Salim Raza
Director
64/1, 15th Street, Khyaban-eMujahid, D.H.A, Phase 5, Karachi House No. 22 A, Street No. 27, F6/2, Islamabad H. No. 34, St 27, Sector F-6/2, Islamabad
Karl Broten
Eric Director
Lars Christian Director Iuel
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7.2.
Powers of Directors
As required under section 196 of the Companies Ordinance, 1984, and the Articles of Association of the Issuer, the authority to conduct business of the Issuer is vested with its Board of Directors and they may exercise all such powers of the Issuer as are not required by the Companies Ordinance, 1984 or the Articles of Association of the Issuer or by a special resolution, required to be exercised by the Issuer in the general meeting of the shareholders. 7.3. Profile of the Chairman of the Board of Directors
Jon Eddy Abdullah, who is currently CEO of Total Access Communication PLC., (dtac), Thailand and also the Chairman of the Issuer, is responsible for bringing mobile banking to the unbanked sector of Pakistan in a very integrated telecom / banking model. Jon has been part of the Telenor Group for 7 years and then became CEO of dtac in March 2011. In late 2008, under the leadership of Jon, Telenor Pakistan took a majority interest in Tameer Microfinance Bank in an effort to leverage its leading brand and extensive distribution network in an effort to serve the vastly underserved banking market. The launch of Easypaisa in October 2009 has been recognized by several organizations round the world as a brand and model to watch and emulate going forward. Before joining dtac, Jon worked in Telenor Pakistan as a CEO, Cesky Mobil (Oskar), Czech Republic as a Chief Technology Officer and DiGi Telecom, Malaysia as a Chief Technology Officer and Operating roles. He has over 18 years experience in the mobile communications industry. Jon received his bachelors degree in electrical engineering from Montana State University, USA. 7.4. Profile of the Chief Executive Officer
Nadeem Hussain is the President and Chief Executive Officer of Tameer Microfinance Bank. Prior to his appointment at Tameer, Nadeem spent 27 years with Citigroup, his last appointment being Country Manager for Citibanks Iraq Operations within the Corporate Banking and Investment Division. Nadeem has held several senior management positions with Citigroup in all major financial centers. Whilst based in the UK before his appointment in Iraq, he was instrumental in starting and managing Citi Solutions, the consumer banks financial advisory and services division for Western Europe, where the expected strength of the distribution force was 20,000 individuals, making it the largest in Western Europe. The target market was the middleincome individual who was under served. Prior to his UK assignment, Nadeem served as General Manager and Head of Consumer Banking for Citibank, Pakistan. Under his guidance, Citibank Pakistan pioneered the concept of consumer banking, with the introduction of credit cards, auto mobile financing and residential mortgage financing. Nadeem effectively turned the bank around after it went into loss due to the freezing of foreign currency accounts in 1998. During this time, Nadeem was appointed to the Board of Directors for Pakistan's prestigious Institute of Business Administration, served as Chairman of the Y2000 Bank Committee and the Overseas Chamber of Commerce and was a member of the Government of Pakistan Investment Advisory Board.
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As Country Risk Manager with Citigroup in Hong Kong and China, Nadeem was responsible for managing a portfolio of $4 billion in risk assets associated with the handover of sovereignty from the UK to China. While in Hong Kong, he was instrumental in establishing a liquidity and asset protection program. Nadeem also worked in New York, Greece, Bahrain and Riyadh for Citibank in credit, risk and relationship management roles. Nadeem joined Citibank in Saudi Arabia in 1979 immediately after receiving his BA in Economics and Accounting from Muhlenberg College in Pennsylvania. 7.5. Profile of the Chief Financial Officer and Company Secretary of the Issuer
Kabeer Naqvi is the Chief Financial Officer and Company Secretary of the Issuer. He is responsible for contributing to the strategy making and execution for the core microfinance lending and branchless banking businesses, to oversee the financial control, corporate finance, treasury and corporate secretarial departments. He has had vast exposure in the field of Accounting and Finance with expertise in the areas of Audit and Tax as he started his career as an audit trainee at Ford Rhodes Sidat Hyder & Co. Chartered Accountants. At Tameer, Kabeer has been instrumental in designing a back-end accounting and integration methodology for the Branchless banking platform. He has also been responsible in designing a framework for management accounting in order to facilitate the flow of information between Tameer and Telenor Pakistan. Prior to joining the Issuer, he was based in Saudi Arabia as a Tax Consultant for Middle East, Ernst & Young. He was primarily responsible for providing tax compliance services to different clients from banking, insurance, fertilizer, cement, manufacturing and oil and gas sectors of the economy. He also worked as the Head of Internal Audit for Trakker Private Limited where he had a successful track record of managing and establishing internal audit procedures in all areas of operations of the company. Kabeer also has expertise in Business Planning and Development as he served at a Managerial position in a company for the House of Habib Group. 7.6. Qualification of directors
In terms of Section 187(h) of the Ordinance read with Article 64(A-viii) of the Articles of Association of the Bank, a director must be a member unless such director is representative of the Government or an institution or authority that is a member, or is a whole time working director who is an employee of the Bank or a Chief Executive Officer or a person representing a creditor. 7.7. Remuneration of directors
The remuneration of a Director for attending meetings of the Board or a Committee formed by the board shall be PKR 10,000/- for each meeting attended by him, or such other amount as may be prescribed by the Board, provided that a Director who is an executive of the Issuer shall not be entitled to any remuneration for attending meetings of the Board or a Committee formed by the Board. The Directors may also be paid all travelling, hotel and other expenses, properly incurred by them in attending and returning from meetings of the Directors or any committee of the Directors or general meetings of the Issuer or in connection with the business of the Issuer. Where a Director or a firm of which such Director is a partner or a private Bank of which such Director is a director holds an office of profit under the Issuer other than the office of Chief Executive or an office as legal or technical adviser or banker,
the terms of remuneration for such office shall be sanctioned by an Ordinary Resolution of the Issuer, except that the remuneration of directors who are executives of the Issuer shall be decided by the Board of Directors.
7.8.
Amount Of Benefits To Promoters And Officers During The Last Two Years
No benefit has been given or is intended to be given by the Issuer to the promoters and officers of the Issuer other than remuneration for services rendered by them as full time executives of the Issuer. 7.9. Interest Of Directors
The Directors may be deemed to be interested to the extent of fees payable to them for attending board meetings. The Directors performing whole time service to the Issuer may also be deemed to be interested in the remuneration payable to them by the Issuer. The Directors may also be deemed to be interested to the extent of any shares held by each of them in the Issuer and/or the TFCs to be applied for and allotted to them through the public issue. 7.10. Interest Of Directors In Property Acquired By The Bank
None of the Directors of the Issuer had or has any interest in any property acquired by the Issuer within the last two years. 7.11. Election Of Directors
The Directors shall comply with the provisions of section 174 to 178, 180 and 184 of the Ordinance relating to the election of Directors and matters ancillary thereto. The seven (7) present Directors of the Issuer were elected / nominated effective April 23, 2009. The Board of Directors of the Issuer in exercise of powers vested in it through section 180 (2) of the Companies Ordinance 1984, has made appointment of directors in order to fill in the casual vacancies occurred from time to time for the remainder of the three year term. 7.12. OVERDUE LOANS, BORROWING POWERS AND VOTING RIGHTS 7.12.1. Overdue Loans The Bank has no overdue loans. 7.12.2. Borrowing Powers The Directors may from time to time raise or borrow any sum or sums of money or make any arrangement for finance for the purpose of the Issuer. The Director may raise or secure the payment of such sum or sums or financial arrangement in such manner and upon such terms and conditions in all respects as they think fit and in particular by making, drawing, accepting or endorsing on behalf of the Issuer any promissory notes or bills of exchange or by issuing bonds, perpetual or redeemable debentures or debenture stock or any mortgage, charge or other security on the undertaking or the whole or any part of the property of the Issuer (both present and future) but no such charge shall be created on unpaid capital of the Issuer. 7.12.3. Voting Rights The TFCs shall not carry any voting rights in relation to the Issuer.
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PART VIII 8. MISCELLANEOUS INFORMATION 8.1. Registered Office Address
15-A, Block 7&8 Central Commercial Area, K.C.H.S. Union, Karachi. 8.2. 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. Bankers to the Issue
Standard Chartered Bank (Pakistan) Limited Bank Al Falah Limited Askari Bank Limited Faysal Bank Limited Tameer Micro Finance Bank Limited Bank Al Habib Limited Summit Bank Limited Habib Metropolitan Bank Limited KASB Bank Limited Sindh Bank Limited 8.3. Auditors
Ernst & Young Ford Rhodes Sidat Hyder, Chartered Accountants 601 Progressive Plaza Beaumont Road Karachi 8.4. Legal Advisors to the Issue
Mandviwalla & Zafar, Advocates and Legal Consultants C 15 Block 2 Clifton Karachi 8.5. THK Associates (Private) Limited 2nd Floor State Life Building 3 Dr. Ziauddin Ahmed Road Karachi 8.6. Material Contracts Registrar
Declaration of Trust dated June 6th 2012 executed between Tameer Micro Finance Bank Limited and IGI Investment Bank Limited in its capacity as the Trustee; Credit Rating Report dated October 9th 2012 issued by JCR-VIS Credit Rating Company Limited; MCGF Guarantees; and
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Market Making Agreement dated 5th October 2012 executed between Tameer Micro Finance Bank Limited and JS Global Capital Limited. 8.7. INSPECTION OF DOCUMENTS
The Relevant Documents may be inspected at the Registered Office of the Issuer, on any Business Day from the date of publication of this Prospectus until the closing of the Subscription List. The term Relevant Documents as used herein means all documents referred to in this Prospectus and includes the balance sheets of the Issuer, profits and loss accounts of the Issuer, the Memorandum and Articles of Association of the Issuer, the Auditors Certificate, the Declaration of Trust and the Credit Rating Report. 8.8. LEGAL PROCEEDINGS
There are no legal proceedings by or against the Issuer. 8.9. INDEMNITY
In terms of Section 85 of the Ordinance and Article 116 of the Articles of Association of the Issuer, every Director, Chief Executive, Chairman, Manager or Officer of the Issuer or any person (whether an officer of the Issuer or not) employed by the Issuer as Auditor or Advisor (Indemnified Party), shall be indemnified by the Issuer and it shall be the duty of the Issuer to pay out of the fund of the Issuer all costs, losses and expenses which any such Indemnified Party may incur or become liable to, in defending any proceedings, whether civil or criminal, arising out of his dealings in relation to the affairs of the Issuer, except those brought by the Issuer against such Indemnified Party, in which judgment is given in the Indemnified Partys favour or in which the Indemnified Party is acquitted, or in connection with any application under Section 488 of the Ordinance ,in which relief is granted to the Indemnified Party by the Court. 8.10. MEMORANDUM OF ASSOCIATION
The Memorandum of Association of the Issuer, contains the objects for which the Bank was incorporated and the business that the Bank is authorized to undertake. A copy of the Memorandum of Association annexed to this Prospectus as Annex 2 (Memorandum of Association) is being published with all issues hereof except those released as newspaper advertisement. 8.11. VENDORS
The Bank has no Vendors in terms of Clause 12 of section 1 Part 1 of the Second Schedule of the Ordinance. 8.12. SUBSIDIARY COMPANY
The Bank has no subsidiary companies. 8.13. ASSOCIATED COMPANIES AND INVESTMENT THEREIN, IF ANY
The Bank has no investments in associated undertakings.
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PART IX 9. APPLICATION AND ALLOTMENT INSTRUCTIONS GENERAL INSTRUCTIONS 9.1. Eligible Investors
The list of investors eligible to subscribe is as follows: 1) Pakistani citizens resident within or outside Pakistan or Persons holding dual nationalities including Pakistani nationality; 2) Foreign Nationals whether resident within or outside Pakistan; 3) Companies, bodies corporate or other legal entities incorporated or established in or outside Pakistan (to the extent permitted by their constitutive documents and existing regulations, as the case may be); 4) Mutual Funds, Provident/pension/gratuity funds/trusts, (subject to the terms of the Trust Deed and existing regulations); and 5) Branches in Pakistan of companies and bodies corporate incorporated outside Pakistan. 9.2. Application for Subscription and Documents
Application must be made on the commissions approved application form or a legible photocopy thereof on a paper of a4 size weighing at least 62 gm. Copies of Prospectus and application forms can be obtained from the members of KSE, the Bankers to the Issue and their branches, and the registered office of the Issuer. The applicants opting for Book Entry TFCs are required to complete the relevant sections of the Application. In accordance with provisions of the CDC Act and the CDC Regulations, credit of such TFCs is allowed ONLY in the applicants own CDC Account. In case of any discrepancy between the information provided in the Application form and the information already available with CDC, the Issuer reserves the right to issue the TFCs in a physical form. Name (s) and address (es) must be written in full block letters, in English and should not be abbreviated. All Applications must bear the name and signature of the applicant. In case of difference in signature with the Bankers to the Issue and Computerized National Identity Card (CNIC) or National Identity Card for Overseas Pakistanis (NICOP) or Passport both the signatures should be affixed on the application form. 9.3. Applications of Individual Investors
In case of individual investors, an attested photocopy of CNIC (in case of RPs)//Passport (in case of Non Resident Pakistanis and Foreign Investors) as the case may be, should be enclosed and the number of CNIC/Passport should be written against the name of the applicant. Copy of these documents can be attested by any Federal/Provincial Government Gazetted Officer, Councilor, Oath Commissioner or Head Master of High School or bank manager in the country of applicants residence.
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Original CNIC/Passport, along with one attested photocopy, must be produced for verification to the Bankers to the Issue at the time of presenting the application. The attested photocopy will, after verification, be retained by the bank branch along with the application. 9.4. Applications of Institutional Investors
Applications made by companies, corporate bodies, mutual funds, provident/pension/gratuity funds/trusts and other legal entities must be accompanied by an attested photocopy of their Memorandum and Articles of Association or equivalent instrument / document. Where applications are made by virtue of Power of Attorney, the same should also be submitted along with the application. Any Federal/Provincial Government Gazetted Officer, Councilor, Bank Manager, Oath Commissioner and Head Master of High School or bank manager in the country of applicants residence can attest copies of such documents. Attested photocopies of the documents mentioned in 8(i) must be produced for verification to the Bankers to the Issue and the applicants banker (if different from the Bankers to the Issue/offer) at the time of presenting the application. The attested copies, will after verification, be retained by the bank branch along with the application. 9.5. Additional General Instructions
In case of joint application, each applicant must sign the application form and submit attested copies of their CNICs/Passport. The TFCs will be dispatched to the person whose name appears first on the application form while in case of CDS, it will be credited to the CDS account mentioned on the face of the form and where any amount is refundable, in whole or in part, the same will be refunded by cheque or other means by post, or through the bank where the application was submitted, to the person named first on the application form, without interest, profit or return. Please note that joint application will be considered as a single application for the purpose of allotment of TFCs. The person to be nominated shall not be a person other than the following relatives of the member, namely, a spouse, father, mother, brother, sister and son or daughter, including a step or adopted child. The nominee must sign the application form and submit attested copies of their CNICs/passport. Subscription money must be paid by cheque drawn on applicants own bank account or pay order/bank draft payable to one of the Bankers to the Issue Tameer Micro Finance Bank Ltd TFC1 and TFC2 Subscription Account and crossed A/C PAYEE ONLY. The applicant should have at least one bank account with any of the commercial banks but not necessarily with the Bankers to the Issue. The applicants not having a bank account at all (non account holders) are not allowed to submit application for subscription of TFCs. Applications are not to be made by minors and/or persons of unsound mind. Applicants should ensure that the bank branch, to which the application is submitted, completes the relevant portion of the application form. Applicants should retain the bottom portion of their application forms as provisional acknowledgement of submission of their applications. This should not be construed as an acceptance of the application or a guarantee that the applicant will be allotted the number of TFCs for which the application has been made.
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Making of any false statements in the application or willfully embodying incorrect information therein shall make the application fictitious and the applicant or the bank shall be liable for legal action. Bankers to the Issue are prohibited to recover any charges from the subscribers for collecting subscription applications. Hence, the applicants are advised not to pay any extra charges to the Bankers to the Issue. For the applications made through pay order/ bank draft, it would be permissible for a banker to the issue to deduct the bank charges while making refund of subscription money to unsuccessful applicants through pay order/ bank draft individually for each application. It would be permissible for a Banker to the Issue to refund subscription money to unsuccessful applicants having an account in its bank by crediting such account instead of remitting the same by cheque, pay order or bank draft. Applicants should, therefore, not fail to give their bank account numbers 9.6. Additional Instructions for Foreign / Non Resident Investors
In case of foreign investors who are not individuals, applications must be accompanied with a letter on applicants letterhead stating the legal status of the applicant, place of incorporation and operations and line of business. A copy of memorandum of association or an equivalent document should also be enclosed, if available. Where applications are made by virtue of Power of Attorney, the same must be lodged with the application. Copies of these documents can be attested by the bank manager in the country of applicants residence. Applicants may also subscribe using their Special Convertible Rupee Account (SCRA) as set out under the State Bank of Pakistans Foreign Exchange Manual. 9.7. Basis of Allotment
The minimum amount of application for subscription of TFCs is PKR 5,000/-. Application for TFCs below the total value of PKR 5,000/- shall not be entertained. Application for TFCs must be made for a minimum of the aggregate face value of PKR 5,000/-, or in multiples of PKR 5,000/- for amounts above PKR 5,000/-.Applications, which are neither for Rs 5,000/- nor in multiples of PKR 5,000/- for amounts above PKR 5,000/-, shall be rejected. Allotment/Transfer of TFCs to successful applicants shall be made in accordance with the allotment criteria/ instructions disclosed in the Prospectus. Allotment of TFCs shall be subject to scrutiny of applications in accordance with the criteria disclosed in the Prospectus and/or the instructions by the Securities & Exchange Commission of Pakistan. Applications, which do not meet the above requirements, or applications which are incomplete will be rejected. The applicants are, therefore, required to fill in all data fields in the Application Form. The Registrar will dispatch TFCs to successful applicants or credit the respective CDC accounts of the successful applicants (as the case maybe). Therefore, applicants are advised to fill in accurate mailing address and CDS account details, if any.
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9.8.
BANKERS TO THE ISSUE 9.8.1. List and Code of Bankers to the Issue
The details of the Bankers to the Issue are given hereinbelow. Code 01 02 03 04 05 06 Name of Banks Standard Chartered Bank (Pakistan) Limited Bank Al Falah Limited Askari Bank Limited Faysal Bank Limited Tameer Micro Finance Bank Limited Bank Al Habib Limited Code 07 08 09 10 Name of Banks Summit Bank Limited Habib Metropolitan Bank Limited KASB Bank Limited Sindh Bank Limited
9.8.2.
Occupation code
The list of occupation code is given hereinbelow. Code 01 02 03 04 05 Occupation Business Business Executive Service Housewife Household Code 06 07 08 09 10 Occupation Professional Student Agriculturist Industrialist Other
9.8.3.
Nationality code
The list of nationality code is given hereinbelow. Code 001 002 003 004 005 Name of Banks U.S.A U.K U.A.E K.S.A Oman Code 006 007 008 009 010 Name of Banks Iran Bangladesh China Bahrain Other
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PART X 10. SIGNATORIES TO THE PROSPECTUS We, the Directors of Tameer Micro Finance Bank Limited, certify that the relevant provisions of the Companies Ordinance, 1984 (Ordinance) and the Guidelines for the Issue of Term Finance Certificates (TFCs) to the General Public (TFC Guidelines) issued by the Securities and Exchange Commission of Pakistan, as the case may be, have been complied with and no statement made in this Prospectus is contrary to the provisions of the Ordinance, any rules and / or regulations made thereunder applicable to the issue of TFCs and publication of Prospectus and / or the TFC Guidelines, as the case may be. Signed on behalf of Tameer Micro Finance Bank Limited: Names of Signatories Jon Eddy Abdullah Director/Chairman Nadeem Hussain President & C.E.O/Director Roar Bjaerum Director Nizar Noor Muhammad Director Salim Raza Director Karl Eric Broten Director Lars Christian Iuel Director Signature -Sd-Sd-
-Sd-Sd-Sd-Sd-Sd-
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Information and Forward Looking Statements
1. 1.1 General Information In this Prospectus, unless the context otherwise indicates or implies, references to Investor, TFC Holders, purchaser, subscriber and potential investor are to the prospective investors in the Issue and all references to the Company and / or the Issuer are references to Tameer Micro Finance Bank Limited. Presentation of Financial Information The Issuer publishes its audited financial statements in Pak Rupees and its audited financial statements are prepared in accordance with GAAP and the Ordinance. Any discrepancies in the tables included herein between the amounts listed and the totals thereof are due to rounding off. Unless stated otherwise, macroeconomic and industry data used throughout this Prospectus has been obtained from publications prepared by providers of industry information, government sources and multilateral institutions. Such publications generally state that the information contained therein has been obtained from sources believed to be reliable but that their accuracy and completeness are not guaranteed and their reliability cannot be assured. Although the Issuer believes that industry data used in this Prospectus is reliable, it has not been independently verified. Forward Looking Statements Certain statements contained in this Prospectus that are not statements of fact, which contain words and phrases such as will, would, aim, aimed, will likely result, is likely, are likely, believe, expect, expected to, will continue, will achieve, anticipate, estimate, intend, plan, may, objective, potential, project, pursue, shall, should, will, would and similar expressions or variations of such expressions are forward looking statements. All statements regarding the Issuers expected financial condition and results of operations and business plans and prospects are forward-looking statements. These forward-looking statements include statements as to the Issuers business strategy, revenue and profitability, planned projects and other matters discussed in this Prospectus that are not historical facts. These forward-looking statements and any other projections contained in this Prospectus are predictions and involve known and unknown risks, uncertainties, assumptions and other factors that may cause the Issuers actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements or other projections. By their very nature, certain of the market risk disclosures are only estimates and could be materially different from what actually occurs in the future. As a result, actual future gains, losses or impact on net interest income and net income could materially differ from those that have been estimated. Accordingly, all forward-looking statements are subject to risks, uncertainties and assumptions about the Issuer that could cause actual results to differ materially from those contemplated by the relevant forward-looking statement. The section on Risk Factors provides an overview on the factors that could have an impact on the Issuer and the Issue and the outcome of the forward-looking statements contained in this Prospectus.
2. 1.1 1.2 1.3
3. 3.1
3.2
3.3
3.4
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PART XI 11. MEMORANDUM OFASSOCIATION
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Subscription Form
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ADVICE FOR INVESTORS INVESTORS ARE STRONGLY ADVISED IN THEIR OWN INTEREST TO CAREFULLY READ THE CONTENTS OF THE

TAMEER MICROFINANCE BANK LIMITED

Type TFC 1 TFC 2 Total

Tenor 13 months 24 months

Issue Amount In PKR (Million) 500 500 1,000

Profit Rate 12.00% p.a. 12.50% p.a.

Prospectus Tameer Sarmaya Certificate

GLOSSARY OF ABBREVIATIONS AND TERMS

Tameer Micro Finance Bank Limited

Prospectus Tameer Sarmaya Certificate

1.18. 1.19. 1.20. 1.21. 1.22.

1.23. 1.24. 1.25. 1.26. 1.27.

Prospectus Tameer Sarmaya Certificate

1.36. 1.37. 1.38. 1.39.

Tameer Micro Finance Bank Limited

Prospectus Tameer Sarmaya Certificate

Tameer Micro Finance Bank Limited

Prospectus Tameer Sarmaya Certificate

Tameer Micro Finance Bank Limited

Prospectus Tameer Sarmaya Certificate

1. SUMMARY OF THE ISSUE

Total Issue Amount Tenor and Amount Offered

Profit Payment Frequency

Subscription Period Profit Accrual

Issue Rating Entity Rating Minimum Investment

Tameer Micro Finance Bank Limited

Prospectus Tameer Sarmaya Certificate

Listing Lead Advisor & Structuring Bank

Bankers to The Issue

Karachi Stock Exchange Limited (KSE)

Tameer Micro Finance Bank Limited

Prospectus Tameer Sarmaya Certificate PART I

Tameer Micro Finance Bank Limited

Prospectus Tameer Sarmaya Certificate

Tameer Micro Finance Bank Limited

Prospectus Tameer Sarmaya Certificate

Tameer Micro Finance Bank Limited

Prospectus Tameer Sarmaya Certificate

Prospectus Tameer Sarmaya Certificate

Tameer Micro Finance Bank Limited

Prospectus Tameer Sarmaya Certificate

2.9. ISSUE,CREDIT AND DESPATCH OF TFCS

Tameer Micro Finance Bank Limited

Prospectus Tameer Sarmaya Certificate

TFC ISSUES IN PRECEDING YEARS

V Withholding Tax @ 10%

VII Principal Payment in %

VIII Principal Amount Outstanding

Tameer Micro Finance Bank Limited

Prospectus Tameer Sarmaya Certificate

III Indicative Profit @ 12.50 %

V Withholding Tax @ 10%

VII Principal Payment in %

VIII Principal Amount Outstanding

Tameer Micro Finance Bank Limited

Prospectus Tameer Sarmaya Certificate

Tameer Micro Finance Bank Limited

Prospectus Tameer Sarmaya Certificate

CALL AND PUT OPTIONS

Tameer Micro Finance Bank Limited

Prospectus Tameer Sarmaya Certificate

Tameer Micro Finance Bank Limited

Prospectus Tameer Sarmaya Certificate