First National Bank Modaraba Records Rs4.35 Million Loss in FY2026 Despite Growth in Assets
First National Bank Modaraba reported a loss for the financial year ended June 30, 2026, while its total assets increased during the year, according to its audited financial statements.
The Modaraba’s financial position showed total assets of approximately Rs443.35 million as of June 30, 2026, compared with Rs425.42 million a year earlier. The increase was supported largely by growth in short-term investments and secured short-term financing-related assets.
Income Declines During the Year
According to the statement of profit and loss, First National Bank Modaraba generated total income of approximately Rs38.94 million during FY2026, down from around Rs49.14 million in FY2025.
Profit on short-term investments stood at approximately Rs32.77 million, compared with Rs40.85 million in the previous year. Profit on bank deposits was relatively small at about Rs376,999.
The financial statements also show other income of approximately Rs6.18 million, including reversals and other income recognized during the year.
Expenses Remain a Major Pressure
Total expenses increased to approximately Rs43.27 million in FY2026 from Rs40.59 million in FY2025. Finance costs were about Rs25.64 million, while operating expenses stood at approximately Rs17.63 million.
As a result, the Modaraba recorded an operating loss before provisions and taxation of approximately Rs4.32 million. After other adjustments, levies and taxation, the loss for the year came to approximately Rs4.35 million, compared with a loss of Rs3.96 million in FY2025.
The loss translated into a loss per Modaraba certificate of Rs0.17, compared with Rs0.16 in the preceding year.
Short-Term Investments Continue to Dominate Assets
The statement of financial position highlights the importance of short-term investments to the Modaraba’s asset base. Secured short-term murabaha investments stood at approximately Rs1.77 million, while short-term investments reached around Rs354.01 million, compared with Rs331.78 million in 2025.
Cash and bank balances, however, declined to approximately Rs4.17 million from Rs9.48 million a year earlier. Net investment in ijarah finance also decreased to about Rs7.14 million, compared with Rs8.99 million in 2025.
Equity Position Remains Negative
The financial statements show total equity and reserves of approximately negative Rs29.88 million at June 30, 2026, compared with negative Rs25.53 million in the previous year.
The certificate capital remained unchanged at Rs250 million, while the statutory reserve stood at approximately Rs45.52 million. Accumulated losses increased to approximately Rs325.40 million.
Operating Cash Flow Remains Positive
Despite the reported accounting loss, the Modaraba generated approximately Rs16.93 million in net cash from operating activities during FY2026. This was lower than the Rs36.45 million generated from operating activities in FY2025.
The Modaraba used approximately Rs22.24 million in investing activities, primarily reflecting investment in fixed assets and other uses. Cash and cash equivalents consequently declined from approximately Rs9.48 million at the beginning of the year to Rs4.17 million at year-end.
Auditors Confirm Compliance Matters
The final page of the financial statements contains the independent auditors’ report on legal and regulatory requirements. The auditors reported that the books of account had been properly maintained and that the financial statements were prepared in conformity with the applicable requirements of the Modaraba Companies and Modaraba (Floatation and Control) Ordinance, 1980. The report also states that the business conducted, investments made, expenditures incurred and guarantees extended were in accordance with the Modaraba’s objectives and terms.
Looking at FY2026
First National Bank Modaraba’s FY2026 results present a mixed financial picture. The Modaraba expanded its asset base and maintained positive operating cash generation, but lower income and higher expenses contributed to another annual loss. At the same time, the negative equity position increased during the year.
The audited figures provide investors and other stakeholders with a detailed view of the Modaraba’s financial position, profitability, cash flows and reserves for the year ended June 30, 2026.
