The JCR-VJS Credit Rating Company Limited had placed the entity ratings of A-/A-2 (Single A Minus / A-Two), assigned to Atlas Bank Limited (ABK), under Rating Watch-Developing status on October 23, 2008 on account of the merger negotiations with KASB Bank Limited and KASB Capital Limited.
While this proposal has not materialised, the Boards of ABK and Saudi Pak Commercial Bank Limited (SPCBL) have agreed for potential merger of the two banks after the majority shareholders of SPCBL entered into a Memorandum of Understanding with the sponsors of ABK for merger of ABK into SPCBL, subject to regulatory approvals.
Furthermore, ABK has been unable to meet the Minimum Capital Requirement, as set by State Bank of Pakistan for FY2008, with total equity amounting to Rs 3.66 billion. On account of these developments, ratings of ABK continue to be placed under Rating Watch-Developing status. Investors will be updated with future developments on this front.-PR