PICIC is a pioneer private sector development finance institution of Pakistan, and has played a key role in the industrial development and creation of industrial infrastructure in Pakistan. It was established in October 1957 by Pakistani and Foreign investors with the assistance of the World Bank.
It was incorporated as a joint stock company under the companies Act 1913 (now the companies' ordinance 1984). PICIC is the largest private sector development finance institution with equity of Rs 7.9 billion. PICIC paid-up capital is Rs 3.8 billion as at June 2006, with a prime objective of providing development finance to the private sector. Since inception PICIC has provided direct assistance to 4502 industrial units spread all over the country with a gross assistance of Rs 58,382.020 million as on June 2006.
Managing Directors/Chairmen of PICIC are always prominent personalities of the highest caliber. One of is Chairman remained Prime Minister of Pakistan. Three of its Chairmen/Managing Directors served government of Pakistan as Federal Minister for Finance, Water & Power and Privatisation. Three of its Chairman/Managing Directors were elevated to the post of governor, State Bank of Pakistan. PICIC's Foreign Shareholders include multinational banks/Insurance Companies and Mr David Rockefeller a prominent business personality of USA.
Once PICIC was used to be presented as a model DFI by the World Bank but with the passage of time, the pioneer financial institution started facing weak financial health due to shortage of liquidity, high intermediation cost of funds, non availability of foreign lines of credit, loss on sale of investments, provision under NBFI's criteria of State Bank of Pakistan. Resultantly PICIC sustained a colossal loss of Rs 405 million during Financial Year 1995-96.
In July 1996, Mr Muhammad Ali Khoja took over the charge of PICIC as Managing Director (CEO). After making a careful and critical analysis of the state of affairs, it was decided to revitalise the Corporation for the purpose of bouncing back.
INITIALLY, A FOUR POINT AGENDA WAS FORMULATED WHICH HAD THE FOLLOWING TARGETS:
Recover PICIC through recovery was the very first slogan given to employees to undertake all possible efforts to enhance recovery from regular and stuck-up advances.
Revision of resource mobilisation strategy for better deposit-mix through innovative deposit scheme simultaneously concentrating on shedding costly institutional deposits.
Re-activation of Treasury & Capital Market operations. Introduction of expenditure budgeting system with special emphasis on austerity drive particularly the administrative expenses were vigorously monitored.
The organisational set-up was modified and the concept of Special Asset Management Group was introduced for loan portfolio management which was segregated into performing and non-performing assets. The task of recovery from the project loans was accordingly assigned to the recovery teams in all the regions. As a strategic move, cases pending in various courts were vigorously pursued.
The object was to improve quality of loan portfolio and settle cases through or outside court. With the above efforts, by the end of the fiscal 1996-97, the Corporation earned an operating profit of Rs 151 million showing effects of turnaround. Since then the Corporation is operating profitably. The recovery amounting to Rs 2.9 billion during 1996-97 was not only highest in the history of PICIC but also the highest amounting nine DFIs of the country as per State Bank of Pakistan's Annual Report, 1996-97. PICIC's cash recoveries during the past 9 years (1996-2005) were Rs 37 billion as on 31st December -2005.
PICIC was awarded secured prize in the competition for best corporate Reports for the Year 2003 by Joint Committee of the Institute of Chartered Accounts of Pakistan (ICAP) and Institute of Cost & Management Accounts of Pakistan (ICMAP)
The Board of Directors of Pakistan Industrial Credit and Investment Corporation Limited (PICIC) at its 288th meeting held on 29th August, 2006 at Karachi, approved accounts of PICIC for the period ended on 30th June 2006. By the Grace of Allah, PICIC declared interim cash dividend @ 10% and bonus shares @ 10%.
Cumulative income for the six month period ended on June 30, 2006 has increased by Rs 1171 million from Rs 1736 million in June 2005 to Rs 2907 million in June 2006 exhibiting a growth of 67%.
PICIC's profit after taxation for the six months period ended on June 30, 2006, improved notably by Rs 212 million to Rs 845 million as compared to Rs 633 million during the corresponding period exhibiting a growth of 33%. Earning per share reported for six month period has improved to Rs 2.24 per share against Rs 1.68 per share reported for the same corresponding period.
During 2006, PICIC has always stood by its commitment to contribute significantly towards national cause of industrial development and providing leverage to its valuable customer base by offering new products and services under its umbrella of a financial supermarket. PICIC would continue to draw inspiration from its vision of being the premier financial institutions of the country and would stand committed to its mission to enhance, with sustained growth, the value of shareholders/depositors' investments and make PICIC "investor preferred institution".
The subsidiaries of PICIC were showing a significant growth whether it is PICIC Commercial Bank Ltd, PICIC Asset Management Company Limited, PICIC Insurance Limited, Financial & Management Services (Pvt.) Limited - FMS and all the affiliates are growing at much faster rates.
PICIC Asset Management Company Ltd (PAMCL) will soon launch two open-end funds. PICIC Stock Fund (PSF) and PICIC Debt Fund (PDF).
PAMCL board has already accorded the approved to both the open-end funds while Security and Exchange Commission of Pakistan (SECP) has also given go ahead for PSF launching. The trust deeds have been signed with the Central Depository Company (CDC) for PSF and PDF.
The initial public offering (IPO) for PSF is likely to be held first and subsequently, the IPO for PDF is expected. PAMCL has recorded an unprecedented growth in the last few years since its inception, recording manifold rise in profits, reserves and net assets. "PAMCL has accumulated a reserve of more than Rs 11 billion and we are so strong that we can pay dividends for next three years without doing any thing ",.
PMCL has so far paid Rs 6.6 billion to certificate holders of PIF and PGF as dividend. The net assets under management of PICIC AMC have increased from Rs 14.9 billion on June 30, 2005 to Rs 18.4 billion on June 30, 2006 exhibiting a growth of 23 percent.
PICIC - AMC will be one of the bidders for National Investment Trust (NIT). We are in the due diligence process as, we are one of the short listed bidders. We had appointed the consultants for the valuation and they have submitted report to the board in this regard.
Privatisation Commission has segmented NIT into six portions. Three of the portions will go to the organisations holding the LOCs PICIC will go for one portion worth Rs 12 billion.
PICIC _ AMC dividend paid by the PIF and PGF during 2005- 2006, PAMCL has handed out a cash dividend of 50 percent or Rs 5 to PIF certificate holders.
The total payout included three interim cash dividends of 40 percent or Rs 4 per certificate and final cash dividend of 10 percent.
Similarly, total pay out to PGF certificate holders was Rs 9 or 90 percent during the period, which included 20 percent interim dividends for last three quarter and a stock dividend of 20 percent and final dividend of 10 percent.
This is the highest dividend announced by any close-end fund in Pakistan, despite high fluctuations in the market. PMCL has paid a total dividend of Rs 3.295 billion under PIF and PGF.
The average market price of PIF was Rs 17 per share and with a 50 percent dividend during the year the divided yield was 29 percent.
Similarly, the average market price of PGF was Rs 51 per share and with a 90 percent dividend during the year the divided yield was 18 percent.
With an authorised capital of Rs 5 billion and paid-up Capital of Rs 3 billion, PICIC Asset Management Company Ltd is one of the largest asset management companies of Pakistan which is a wholly owned subsidiary of Pakistan Industrial Credit & Investment Corporation Ltd (PICIC).
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