BoK likely to raise paid-up capital to Rs 5 billion by year-end

The Bank of Khyber (BoK) is expected to raise the current paid-up capital from rupees four billion to rupees five billion by the end of the current calendar year and for this purpose, the management of the bank was reviewing different options, including bonus share or right issue.
Briefing the newsmen here on Monday BoK Managing Director Bilal Mustafa claimed that bank during the nine months of the current calendar had registered a growth of 46 per cent. He said that most of the major banks were in extremely difficult situation due to current liquidity crunch, but "we have not only survived, but also did lending to other banks."
Bilal Mustafa said that the international financial crisis and current macro-economic crisis had affected the financial institutions, adding that even some of the big banks were unable to meet their obligations. "The Bank of Khyber though a small bank, even than we extended helping hand to other banks," remarked Bilal, adding: "It shows effectiveness of our liquidity management in this critical time."
Highlighting some of the growth indicators of the BoK, Bilal said that the bank's net profit had reached Rs 397 million by September 31 as against total profit of Rs 271 million reported by December 2007, indicating a growth of 46.49 per cent. Similarly, he said the growth had been witnessed in all the major components of the BoK's balance sheet, including total assets, advances, deposits, revenue and operating profit.
He anticipated a record growth in all the segments by the end of current calendar year. The BoK was established in 1991 through Act XIV of the Provincial Assembly of NWFP. The bank commenced its commercial operations in November 1991 and was given the status of a scheduled bank by the State Bank Pakistan in 1994. At the moment, it operated with 34 branches, including 16 specified for Islamic mode of banking and 18 as conventional.
Bilal said the management of the BoK had decided to continue with both type of banking operation, which was also a unique thing distinguishing it from other contemporary financial institutions of the country. He said the BoK was starting foreign exchange business through its Islamic banking branches, for which special products had been designed, which would further boost its business.
The BoK, he further said, had reached an agreement with Pakistan Insurance Corporation, a state-owned company, to insure crops and machinery covered under the banks' agriculture credit facility. He opined that this facility would provide a financial back up to the farmers throughout the country, including Azad Jammu and Kashmir and Northern Areas.
At the moment, the NWFP government is 51 per cent stakeholder in the BoK, while 49 per cent shares belong to the private sector. The BoK management was trying its best to provide competitive and market-based salaries and other privileges to its staff, as recently 20 to 22 per cent pay raise had been given to the staff, whereas 83 per cent eligible cases of promotion had been disposed off, he said while responding to another question.