The State Bank of Pakistan (SBP) has allowed MCB Bank to commence due diligence of Burj Bank Limited for proposed acquisition of its 55 percent share. The management of MCB Bank on Tuesday disclosed to its shareholders that the central bank has given an approval to the bank for conducting a detailed due diligence of the bank to invest in new and existing shares along with additional investment by Islamic Corporation for Development of Private Sector, the private sector investment arm of Islamic Development Bank.
Sources said MCB Bank is conducting due diligence of Burj Bank Limited from March 18, 2014. Recently, MCB Bank successfully obtained permission from the SBP to establish a separate subsidiary of Islamic bank. MCB Bank is working on an aggressive expansion plan to extend its business and as part of this plan the bank has decided to acquire majority shares of 55 percent in the Burj Bank Limited.
Burj Bank is operating with 75 branches countrywide, but it is facing some financial complications and failed to meet SBP's minimum capital requirement of Rs 10 billion by end-2013. The banks also posted a loss of Rs 645 million in the third quarter of 2013.
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