KARACHI: The Royal Bank of Scotland (RBS) said on Wednesday that Faysal Bank is to acquire 99.37 per cent of RBS Pakistan for Rs4.298 billion ($50.37 million).
“This equates to approximately Rs2.52 per ordinary share,” RBS said in a letter to the Karachi Stock Exchange.
Faysal Bank, which is 68 per cent owned by Bahrain-based Ithmaar, beat Egyptian Bank EFG-Hermes.
The State Bank of Pakistan (SBP) said in March that it had allowed Faysal Bank and EFG-Hermes to conduct due diligence on RBS’s Pakistani operations, which include conventional and Islamic banking.
RBS said that the transaction was subject to the approval of the State Bank and is expected to be completed in the third quarter of 2010.
“It’s a perfect fit considering we were trying to increase our footprint. Further, employees of the combined entity could have potentially greater career opportunities and development options,’’ said Naved A Khan, CEO of Faysal Bank.
MCB Bank said in January that its bid for RBS’s Pakistan operations had lapsed because it had failed to get regulatory approval. MCB had agreed in August last year to buy 99.37 per cent of RBS Pakistan for about $87 million.
RBS is withdrawing from 16 countries and scaling back in a further 21, after posting the biggest loss in British corporate history in 2008. RBS would now focus on core domestic businesses.
In addition, the bank will also remain in 17 “core countries”, according to Michael Strachan, an Edinburgh-based spokesman at RBS.
The purchase would add 79 branches to Faysal’s network of 133 outlets. Faysal Bank, a full service bank, is the 12th largest in Pakistan based on asset size as in March 2010.
Published in the Express Tribune, June 17th, 201.
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