Annual Report 2024

Dar Al-Maal Al-Islami Trust NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS For the year ended 31 December 2024 in thousands of USD 26 4. Financial instruments A. Capital Management The Group’s objectives when managing capital, which is a broader concept than the ‘equity’ on the face of statement of financial positions, are: (i) To safeguard the Group’s ability to continue as a going concern so that it can continue to provide returns for shareholders and benefits for other stakeholders; (ii) To maintain a strong capital base to support the development of its business; and (iii) To comply with the capital requirements set by the regulators of the banking markets where the entities within the Group operate. The Board of Directors are responsible to set out risk management policies and guidelines. In order to maintain or adjust the capital structure, the Board of Directors may adjust the amount of dividends paid to shareholders or sell assets to reduce debt. DMI itself does not engage in banking business and is therefore not required to comply with any minimum capital adequacy requirements. The regulatory capital requirements are applicable to Ithmaar Bank B.S.C. (c) which is a 100% owned subsidiary of Ithmaar Holding. Ithmaar Bank has not complied with the requirements of the Central Bank of Bahrain’s Rulebook Volume 2 “Licensing requirements” which states that an Islamic retail bank licensee must maintain a minimum total shareholders’ equity of BHD 100 million. As at the reporting date other subsidiaries within the DMI group do not have any specific regulatory capital requirement. In order to maintain or adjust capital, the Group may adjust the amounts of dividends paid to equity participants, issue new equity or sell assets. The Group monitors capital on the basis of a gearing ratio. This ratio is calculated as net debt divided by total capital. Net debt is calculated as due to banks and financial institutions and lease liabilities less cash and cash equivalents. Total capital is calculated as equity as shown on the face of the consolidated financial statements. As at 31 December 2024 and 2023, the Group did not breach any covenant terms.