KARACHI (June 14 2003) : The State Bank of Pakistan, country's central bank, gave permission to Crescent Investment Bank Ltd to operate as commercial bank after its merger with a local unit of Dubai-based Mashreq Commercial Bank, sources said.
The central bank allowed merger of Crescent Investment Bank Ltd with Mashreq Commercial Bank and gave one month to start its operation as commercial bank in the country, said sources in the banking circles.
Mergers in Pakistan's financial industry began in 2001 after the central bank advised the country's 42 commercial banks to double their minimum paid-up capital to Rs 1 billion from Rs 500 million.
“The new name will be Mashreq Bank Pakistan Ltd,” sources said.
Mashreq Bank is the fourth largest bank in the United Arab Emirates with total assets at the end of 2001 of $6.1 billion.
It has branches in Bahrain, Egypt, Hong Kong, India, Kenya, Qatar, Sri Lanka, the UK and the US.
In 2001, two mergers took place between Faysal Bank and Faysal Investment Bank, both with the same owners.
Al-Meezan Investment Bank merged with the local operations of Societe Generale SA.
Al-Meezan recently received permission from the central bank to operate the first Islamic interest-free banking services.
Crescent Investment Bank's total assets as of March 31, 2003 were at Rs 3.104 billion, against Rs 3.481 billion on December 31, 2002.
Due to the amalgamation into commercial bank, the management is following a conscious policy of shedding its expensive resources.
During the period the bank managed to earn capital gain of Rs 52 million.
The after-tax profit for the period amounted to Rs 58 million during the quarter as against Rs 366 million during same period last year.
The profit in the comparative period of last year was significantly higher due to substantial off-loading of investments during the period.
The after-tax earnings per share for the three months ended March 31, 2003 worked out to Rs 1.16 per share against Rs 7.31 per share of the same period a year earlier.
The break-up value based on capital and reserves position as on March 31, 2003 was Rs 23.38 per share. By taking revaluation surplus, the adjusted break-up value would be Rs 24.91 per share.