The State Bank of Pakistan (SBP) has granted in-principle approval to Bank Alfalah Limited (BAFL) to facilitate Bank Asia Limited in conducting due diligence of operations in Bangladesh as the Pakistani entity looks to sell 100% of the assets and liabilities attributable to the Bangladesh operations.
BAFL, one of Pakistan’s largest commercial banks, shared the development in its notice to the Pakistan Stock Exchange (PSX) on Friday.
“We are pleased to inform you that the State Bank of Pakistan has granted in-principle approval to Bank Alfalah Limited (BAFL) to facilitate Bank Asia Limited (Bank Asia) in conducting the due diligence of BAFL’s operations in Bangladesh, in view of the prospective sale of 100% of the assets and liabilities attributable to BAFL’s Bangladesh operations to Bank Asia,” read the statement.
“The consummation of the proposed transaction is subject to detailed due diligence, execution of transaction documents and receipt of regulatory and third-party approvals and consents.”
Last month, Bank Asia Limited, a private-sector commercial bank in Bangladesh, announced its intention to acquire BAFL’s operations in Bangladesh along with its assets and liabilities.
About the banks
Incorporated in 1999, Bank Asia expanded operations with the purchase of Bank of Nova Scotia branches and Muslim Commercial Bank Limited’s (MCB) Bangladesh operations. In 2001, it purchased the operations of Scotiabank which entered Bangladesh in 1999.
BAFL is one of the largest banks in Pakistan, with a network of over 1,024 branches across more than 200 cities in the country, and an international presence in Afghanistan, Bangladesh, Bahrain, and the UAE.
Bank Alfalah posted a consolidated profit after tax of Rs36.09 billion during the year 2023, which is over 96% higher than its earnings in the preceding year.
The bank reported earnings per share (EPS) of Rs23.15 as compared to Rs10.38 in the same period last year.
However, despite higher net income, Bank Alfalah saw its profit fall to Rs9.93 billion during the quarter ended March 31, 2024, which is nearly 8% lower than its earnings in the same period of the previous year.
The decline in profit-after-tax (PAT) is attributed to much lower foreign exchange income, higher operating expenses, and increased taxation.
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