Wholly-owned subsidiary: NIB Bank likely to sell equity stake

Financial institution is currently evaluating the feasibility of pursuing the transaction.

KARACHI:

NIB Bank may sell its equity stake in its wholly-owned asset management subsidiary, according to a stock exchange filing on Wednesday.

‘A few parties’ have shown interest in potentially acquiring NIB Bank’s equity stake in PICIC Asset Management Company, which is 100% owned by the bank.

“The management of the bank is currently evaluating the feasibility of pursuing the transaction for possible disinvestment of its equity share in the asset management company,” the notice said.

Set up in 2004, PICIC Asset Management Company is managing six open-end funds and two closed-end funds. The latest data on the company’s assets under management was not available on the website of the Mutual Funds Association of Pakistan (MUFAP).

According to the corporate profile of PICIC Asset Management Company last updated in August, it managed over Rs26 billion with an investor base of around 40,000 individuals, trusts and corporations.

It also claimed that its equity portfolio, represented by PICIC energy and stock funds, was the largest in Pakistan market after that of the state-owned National Investment Trust (NIT).

As of February 4, 13 out of 21 conventional equity funds operating in Pakistan outperformed PICIC Stock Fund, which posted a return of 27.2% in the last 365 days. NIB Bank along with all its subsidiaries currently maintains 84.6% interest in the Pakistan Stock Fund.

The second equity fund, PICIC Energy Fund, posted a return of only 10.6% over the last 365 days, which makes it the worst performing equity fund operating in Pakistan.

Published in The Express Tribune, February 5^th,  2015.

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