Privatisation Minister Zahid Hamid on Friday launched United Bank Limited Gross Depository Receipts (GDRs) on the London Stock Exchange marking Pakistan Capital Markets Day at the world famous bourse and said tat the structural economic reforms introduced by the present government were yielding hugely positive results.
The Minister, in presence of Pakistan High Commissioner to United Kingdom, Dr Maleeha Lodhi, senior management of United Bank and leading UK-based businessmen pressed a button that sent 729 balls floating into air and signalled the launch of UBL shares on the LSE.
Each of the 729 balls symbolised the various scrips on the LSE. The UBL share opened at $12.85 and, within half an hour of its opening, it had climbed to $13.96 per share.
The listing and trading of UBL GDR on the LSE was yet another significant milestone in Pakistan government''''s privatisation program, said the Minister, who added that similar GDRs of National Bank of Pakistan, Habib Bank and Kot Addu Power Company would be offloaded at the London Stock Exchange in the coming months.
The listing of UBL shares on the LSE, following the success of Muslim Commercial Bank and Oil and Gas Development Corporation (OGDC), has raised the number of Pakistan companies trading on the LSE to three in the past eight months.
Zahid said that UBL transaction generated demand of more than $2.5 billion from all over the world. The Government, he said, ultimately decided to raise total proceeds of $650.3 million at $12.85 per GDR. This price valuation, of five times price to book value per share, was highest ever valuation multiple attained for a banking sector GDR, and was at a premium compared to all other GDRs of Asian banks, he said.
He further elaborated that UBL transaction, along with the successful MCB and OGDC GDR offering, and the $750 million ten-year sovereign bond issued last May, which was oversubscribed by more than seven times, reflected foreign investors'''' appreciation of the continuous improvement in Pakistan''''s economic fundamentals and their confidence in its future prospects.
He spoke about the economic reforms initiated by the present Government based on the pillars of privatisation, deregulation and liberalisation, accompanied by transparency, good governance and continuity and consistency of policies, "which have created an attractive and conducive investment climate".
The economy continues to perform well with GDP growth averaging more than 7.5 percent per capita income, increasing by an average 13 percent per annum over the last four years, and poverty declining from 34.5 percent in 2000-01 to 23.9 percent in 2004-05, he said.
The Minister noted that the overall investment had increased to 23 percent of GDP in 2007 while the foreign investment had increased from $182 million in 2000-01 to more than $7 billion in 2006-07, the highest level in the country''''s history.
Speaking about UBL growth, Zahid said it has more than 1000 domestic and 15 overseas branches and more than 14 percent share of the fast growing consumer lending market in Pakistan.
Maleeha said the listing of UBL reflected the fundamental strength of Pakistan''''s economy and the banking had been the best performing sectors. She appreciated the liberal economic policies of the present Government under the leadership of President General Pervez Musharraf, which led to highest levels of investment in the country.
The High Commissioner also noted the vibrancy in the national economy and said that public-private partnership had been playing a positive role in strengthening the overall economic outlook of the country. She further said Pakistan''''s bonds were being persistently oversubscribed, "which mirror the confidence of the international investors in Pakistan''''s economy".
Felicitating UBL on its listing, Baroness Cohen, Director, London Stock Exchange, said the occasion underlined the growing integration of Pakistan into the global economy. She said that solid macroeconomic performance over the recent years, combined with business-friendly reforms and a privatisation program had energised a new generation of Pakistani companies to expand their global operations.