A consortium led by United Bank Limited (UBL), a Pakistani commercial bank with total assets of PKR 747 billion (USD 8.2 billion) as of December 2010 [2], reportedly has been selected as the highest bidder for 67.4 percent of the shares of Pakistani microfinance institution Khushhali Bank Limited, whose gross loan portfolio stood at USD 43.5 million as of December 31, 2010 [1].The amount of the bid has not been released.
Other members of the consortium include Rural Impulse Fund II, which is managed by Belgium’s Incofin Investment Management; Credit Suisse Microfinance Fund Management Company, representing ResponsAbility Global Microfinance Fund; Shorecap II Limited, represented by Equator Capital Partners LLC; and ASN-Novib Microkredietfonds, represented by Triple Jump BV.
UBL’s post-acquisition, direct shareholder position in Khushhali will be approximately 29.7 percent. The size of the stakes taken by the other investors has not been released. Habib Bank Limited, MCB Bank Limited and Allied Bank Limited were previously listed as shareholders in Khushhali; whether they are selling some or all of their holdings through this transaction remains unclear. The proposed acquisition is conditional upon approvals from the State Bank of Pakistan and the Competition Commission of Pakistan [3].
Amira Berrada, Research Associate
About Kushhali Bank Limited (KBL): Khushhali Bank Limited is a Pakistani microfinance bank that was founded in 2000 as part of Pakistan’s Poverty Reduction Strategy and its Microfinance Sector Development Program (MSDP). Initially operated by the State Bank of Pakistan, the country’s central banking authority, Khushhali Bank was converted into a public limited company on April 1, 2008. As of December 31, 2010, Khushhali Bank reported to the US-based nonprofit Microfinance Information Exchange (MIX) total assets of USD 84.5 million, a gross loan portfolio of USD 43.4 million, return on assets (ROA) of 1.1 percent, return on equity (ROE) of 3.53 percent and 325,000 active borrowers.
About United Bank Limited (UBL): United Bank Limited was incorporated in Pakistan in the 1960s and has assets of approximately PKR 747 billion (USD 8.2 billion). The bank operates 1,200 branches within Pakistan including seven Islamic banking branches, one branch in the Karachi export processing zone and 17 branches outside Pakistan. The bank’s ordinary shares are listed on three stock exchanges in Pakistan, and its global depositary receipts are listed with the UK Listing Authority and the London Stock Exchange Professional Securities Market.
Sources and Resources:
[1] MicroCapital Universe Profile: Khushhali (KBL) https://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=Khushhali+Bank
[2] https://www.ubldirect.com/Corporate/InvestorRelations/FinancialStatement.aspx
[3] http://www.brecorder.com/money-a-banking/198/1158689/
MicroCapital.org story, April 17, 2008, “MICROCAPITAL STORY: Top Pakistani Microfinance Institution Khushhali Bank Moving Into Private Sector” https://www.microcapital.org/microcapital-story-top-pakistani-microfinanc…
MicroCapital.org story, May 23, 2011, “MICROCAPITAL BRIEF: Pakistan’s Khushhali Bank Partnering With Western Union to Offer International Remittances” https://www.microcapital.org/microcapital-brief-pakistan%e2%80%99s-khushh…
About Khushhali: https://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=Khushhali+Bank
About Rural Impulse Fund: https://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=Incofin+Rural+Impulse+Funds+%28RIFs%29
About ResponsAbility Global Microfinance Fund: https://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=responsAbility+Global+Microfinance+Fund+%28rAGMF%29
About Triple Jump: https://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=Triple+Jump
About Shorecap II: https://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=ShoreCap+II+Fund+%28SCII%29
About Incofin: https://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=Incofin+Investment+Management+%28Incofin+IM%29
Browse the MicroCapital Universe and add your entry to the wiki at: https://www.microcapital.org/microfinanceuniverse/
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