Mobilink has raised Rs. 200 crore or Rs. 2 billion through privately placed Term Finance Certificates (TFCs) also known as secured loan raised through institutional investors, said a notice sent to Karachi Stock Exchange.
We are yet to ascertain whether this capital injection will be used for network expansion, 3G rollout, investment in branchless banking or for an upcoming acquisition. But we are certain that this fund will not be used for meeting operational expenses.
Trading in Mobilink’s TFCs will only take place between the members outside the stock exchange system and settlement of trade will take place on counter party basis. The market lot of one certificate will be of a face value of Rs 100,000 and the minimum amount per transaction (only between institutional investors) will not be less than one million rupees.
According to details ProPakistani (a sister concern of EconomyAge) has got, the maturity of these TFCs are up to 48 months with the maturity date of March and April 2016 with an expected interest rate of KIBOR plus 2.65% per annum.
The principle repayment of this Rs 200 Crore loan will start from 3rd month of issuance and will be paid in installments of 10%, 20%, 30% and 40% in 1st, 2nd, 3rd, and 4th year, respectively.
These loans are rated Single A plus (A+) by PACRA, which denotes a strong capacity of timely financial commitments, and are secured by Mobilink’s all present and future movable long-term assets.
Renowned Banks, Insurance companies and provident funds of multinationals in Pakistan have put their money behind these TFCs. Half of the contributions are made by three banks with JS Bank investing Rs 45 Crore and Silk Bank and KASB bank putting Rs 25 Crore each.
Following is the list of Institutional investors (clicking on image will open it in full size):
Soneri Bank Limited which has been showing robust growth for last few quarter might be in trouble if textile sector in Pakistan fails to perform well, analysts learned after a report published by Pakistan Credit Rating Agency.
Although the report from PACRA maintained the long-term and short term entity rating of Soneri Bank at Double A minus (AA-) and A One Plus (A1+), respectively, which denote a very low expectation of credit risk but the detailed report indicates risks Soneri might be facing from Non-Performing Loans, especially from the loans Soneri made to textile sector.
According to the report, the asset quality of Soneri Bank remained under pressure with non-performing loans witnessing an absolute reported increase of approximately 23%.
Soneri Bank has the highest exposure in textile sector that is equivalent to 33% of total advances (loan made by the bank). To make matters worse, almost half of non-performing loans are generating from textile sector.
The report also suggests that although Soneri’s management is cognizant of the dire situation and has beefed up recovery efforts but any further deterioration in asset quality may impact the bank’s risk absorption capacity.
It is worth mentioning here that last year, Soneri Bank also made a right issue amounting to Rs. 100 Crore and also declared 12.5 percent bonus shares to its shareholders increasing the paid up capital to 800 Crore in compliance with the Statement Bank‘s Minimum Capital Requirement, thus saving itself from any potential target for an acquisition.
In an interesting turn of events – NIB Bank, dubbed as the most inefficient mid-tier bank till last year, has been granted approval to conduct due diligence of CitiBank Pakistan’s consumer division.
- The Positive changes in NIB’s Strategy were evident after Badar Kazmi took charge as President and CEO some six months ago.
NIB Bank is now the fourth official predator to target CitiBank Pakistan after Habib Bank, Bank Alfalah and Faysal Bank with rumors that Turkish Isbank might also join.
NIB Bank, which itself was a target of an acquisition by Industrial and Commercial Bank of China, intended to launch its consumer financing division long ago. The signs were evident when NIB Bank stole Adil Rashid from Bank Alfalah to run its Consumer finance department.
"Some of the executives of NIB Bank were in UAE couple of months ago to sign a deal with VISA and a substantial investment was set aside to launch its consumer services in Pakistan but they were called back by the head office where it was discussed if acquiring CitiBank consumer division is a better idea", sources privy to the matter, confided to EconomyAge.
"There are bright chances that NIB get the CitiBank consumer division and there has been multiple successful meetings between highly ranked officials of two banks", told us another source on condition of anonymity.
If anything, the competition to acquire CitiBank’s consumer division is heating up with every passing day and with more potential acquirers expected.
EconomyAge is closely watching the development and we will keep you updated with any further progresses.
The Pakistan Credit Rating Agency (PACRA), responsible to evaluate the capacity and willingness of an entity to honor its obligations, has upgraded the long-term entity rating of JS Bank Limited (JSBL) to “A+” (Single A Plus) from “A”, while maintaining the short-term entity rating at “A1″ (A One).
- JS Bank Operates a network of 148 Branches across Pakistan
These ratings denote a low expectation of credit risk while the capacity for timely payment of financial commitments is considered strong.
“The ratings reflect the bank’s sound financial profile emanating from improving profitability, strong liquidity and supporting capital adequacy. The bank’s strengthening franchise owing to its expanding branch network, supported by a sound technological platform is a key consideration. The bank is expanding its asset base, which is currently being managed comfortably”, said the press release issued by PACRA.
With transfer of relatively established asset management and brokerage businesses to bank – as subsidiaries – by its parent, JS Bank now possess significant potential to synergize and capitalize on in these domains. The ratings draw comfort from association with the JS Group.
Although the report issued by PACRA also suggest that as the size of the bank grows, a careful monitoring of related risks would require management’s active attention. Similarly, building a quality loan book and effective deployment of funds via careful selection criteria would be critical.
According to an official notice sent to Karachi Stock Exchange, the board of directors of Habib Bank has appointed Mr Nauman K. Dar as the new CEO and President of Bank, who will be taking over the retiring president Mr Zakir Mehmood, in September 2012.
Highly reliable source confided and tipped this news to EconomyAge two months ago and many industry experts were skeptic at that time.
The retiring president Mr Zakir Mehmood served Habib Bank for 12 years and were recognized by the board of directors as an invaluable asset. The Chairman, Mr Sultan Ali Sullana, applauded Mr Mehmood’s leadership and exemplary dedication in the evolution and re-positioning of the bank since 2000, which has resulted in HBL becoming the leading bank in Pakistan.
‘The new CEO of Habib Bank, Naumna K. Dar, has been a career banker and brings with him a wealth of 30 years of banking experience’, read the press release issued by Habib Bank.
Before becoming CEO and President, Mr Dar was head of Habib Bank’s Corporate and Investment Bank. Although, Dar’s appointed is subject to regulatory approval.
Faysal Bank join in an already heated and interesting race to acquire CitiBank Pakistan’s consumer asset portfolio. In a notice sent to Karachi Stock Exchange – Faysal Bank informed that State Bank of Pakistan has granted them approval to conduct due diligence of CitiBank consumer portfolio in Pakistan.
Back in 2011 - Faysal Bank acquired RBS operations in Pakistan despite bring the second highest bidder after MCB Bank failed to get Regulatory Approval
The acquisition temperature heats up in banking industry after international banks decided to scale down their operations globally. HSBC Pakistan and CitiBank already offered themselves for sale with rumors that Standard Chartered is also considering to exit from Pakistan.
All of these operations on sale are extremely profitable and local and few international banks are eyeing this opportunity. Before Faysal – Bank Alfalah and Habib Bank showed their interest to acquire CitiBank Pakistan with rumors that Isbank, a Turkish bank, might join the race.
It would be interesting to note that Faysal Bank has been in news for all the wrong reasons for past few weeks. EconomyAge was first to report that there has been some kind of an internal rift and the bonuses awarded to employees from Faysal Bank wasn’t much appreciated. This unrest news came immediately after it was reported that SECP issued prohibitory order against the bank and accuse them of manipulating share prices in stock trading.
Previously, in a dramatic situation last year, Faysal Bank acquired Royal Bank of Scotland’s operations in Pakistan despite being the second highest bidder after MCB Bank failed to get regulatory approval.
Burj Bank Limited in Pakistan has selected Dialogic Technology and ZRG contact center apps for their upcoming contact center project, said a statement shared with ProPakistani.
Burj Bank contact center project is aimed at providing the best quality of services to the customers in a cost-effective way.
Burj Bank required an experienced solution provider offering the best technology and associated services.
Burj Bank invited offers from several providers and conducted thorough evaluations of the offered technology, capabilities and strengths and prior performance of the technology from Cisco, Genesis, Dialogic and Avaya. Local dealers and resellers were also evaluated.
After evaluating several products, Burj Bank decided to go with Dialogic Technology due to flexibility, durability and its long term partner ZRG, a well recognized IT company in the region offering fully customized and integrated solutions.
Dialogic is a globally recognized leader and a pioneer in the innovative contact center communication and CTI technology. ZRG is well-known pioneer in ICT solutions and has a successful and un parallel track record of successfully delivering result-oriented and durable solutions during last 18 years.
Dialogic Technologies, deployed by ZRG are being successfully used by 16 leading banks within Pakistan and abroad, in addition to many other brand name organizations such as TCS, PSO, Sanofi, EFU, Allianz, MultiNet, PTCL and many others.
Syed Shabbar Zaidi, an authoritative and leading tax expert, also partner for taxation of A.F.Ferguson, reminded the policy makers, yet again, that we need a working and stable tax collection system.
Shabbar Zaidi has said that improvement in the prevailing system of tax collection can lead to tax-revenue of Rs 200 billion to 250 billion.
In a statement, Shabbar Zaidi said there was a dire need for revolutionary measures in the system of tax-collection to ensure effective implementation of administrative matters and that of the law.
Zaidi also proposed that, in his view, all political parties should share the same agenda for economic stability in the country. He also emphasized that income tax should essentially be received on all the income above Rupees 400,000, regardless of the sources of income.
Tax has been imposed on agriculture but it is not being collected effectively, he added.
“Despite the target of tax collection amounting to Rupees 1952b, only Rs 1875 bn to Rs 1900 billion would be received as tax during the current year”, added Zaidi. He noted the government was depending on economic growth rate for collecting a tax of Rs 2380 bn in the next year.
Bank Alfalah and Habib Bank, which have been eyeing to acquire CitiBank Pakistan’s mouth-watering Consumer Division, might be sharing the acquisition fight with Isbank, a leading Turkish Bank, told us highly placed sources in Industry on condition of anonymity.
According to the sources, Isbank doesn’t want itself to be another Temasek Holdings, which has not been very happy with the performance of NIB Bank, while this CitiBank’s deal is aimed at providing them handsome number of upper and middle class customers.
They would rather prefer to start with an existing portfolio than starting from scratch, and CitiBank’s consumer division will be better than anything else. HSBC Pakistan and CitiBank’s Consumer Division will provide them a healthy jump start.
Isbank, which was authorized by State Bank of Pakistan on 27th December 2011 to open a branch in Pakistan, was also in news two weeks ago when it was authorized by State Bank to conduct due diligence of HSBC Pakistan’s operations. Isbank will be competing with KASB and JS Bank for HSBC Pakistan.
It is worth mentioning here that MCB Bank and United Bank’s requests for conducting due diligence for HSBC Pakistan were declined but Isbank’s request was accepted within a week. But the speed with which Turkish bank is working is not a surprise for many given the government’s interest to seek more Turkish investments, through incentives and packages.
EconomyAge contacted Isbank for their comments on this development but the officials at Isbank were tight-lipped about the said acquisition. They only went far enough to say that it is not possible for them to share any information regarding the issue for time being.
Citi Bank’s consumers division is possessing handsome number of customers, mostly from elite and upper middle class of the society having good inclination to avail banking services such as credit cards, car financing etc..
To the dismay of everybody, Jubilee Insurance has now jumped to the hateful business of spamming emails, earlier the best was confined to smaller local brands with little knowledge only that even lacked professionalism.
Apparently, Jubilee Insurance hired a company to send their message in emails to those who never subscribed to get promotional emails and that too from unknown senders.
Legally speaking Jubilee Insurance should bear in mind it is doing a crime punishable under the law as Electronic Transaction Ordinance section 36 and 37. Their prosecution may go severe if PECO is given a go ahead from parliament.
One would wonder as to what led jubilee to this extent of frustration that they started spamming into inboxes of internet users. As far as smaller businesses are concerned that is understandable but one does not expect such superficial things from a brand name like Jubilee Insurance.
Lets call a spade a spade, regardless who is doing what, law must come down heavily against all of them, no matter what is the status of the individual or company.