The NIB Bank Wednesday declared its declining profit after tax (PAT) of Rs 1.420 billion in 2016, down by 84 per cent or Rs1.196 billion, compared to Rs 2.617 billion in the same corresponding period last year.
Since August 2016, MCB bank is in the process of due-diligence with NIB Bank after the approval from the State Bank of Pakistan. The deal is not finalised till now. In its financial statement released at Pakistan Stock Exchange (PSX), the bank said that its profit before tax stood at Rs 992.533 million in 2016, which stood at Rs 4.026 billion in 2015.
The bank net interest income (NII) declined to Rs 7.099 billion in last corresponding period of 2016, which was at Rs 10.435 billion in 2015. According to the financial statement, the bank earned an amount of Rs 15.413 billion in interest or market, but it declared its expenses of Rs 11.011 billion in 2016. The actual profit earned through the interest income stood at Rs 4.401 billion last year, compared to Rs 4.642 billion earned in the same period 2015.
The board of MCB Bank approved the bank’s merger with NIB Bank at a share swap ratio. However, both the banks are waiting for the approval from the State Bank. “The shareholders of MCB at their extraordinary general meeting, held on 23 January, have unanimously approved and adopted the scheme of amalgamation of NIB Bank Limited with and into MCB, through a share swap arrangement,” said MCB, in a notice issued to the Pakistan Stock Exchange.
“The shareholders of MCB have also unanimously approved the swap ratio of one new ordinary share of MCB Bank for every 140.043 shares of NIB for the scheme of amalgamation. As a consequence of the approved amalgamation, 73,569,197 ordinary shares of MCB will be issued in favour of the shareholders of the NIB Bank. “The proposed swap ratio values each share of NIB at approximately Rs 1.58, whereas the book value of each NIB share is Rs 1.84 and the market price of each NIB share was Rs 2.21 on 6 December 2016, just a day before the announcement of the proposed merger.”
Fullerton Fund Management Company Ltd, a subsidiary of the Singaporean state investor Temasek Holdings, was trying to exit from Pakistan through divesting its majority stake in NIB Bank. It initiated the divestment process in 2011. NIB sustained a net loss of around Rs 17 billion since Temasek acquired the bank back in 2005, the analyst said.
