SC extends restraining orders against merger of Summit, Sindh Bank

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KARACHI: The Supreme Court (SC) on Saturday extended its restraining order regarding the merger of Sindh Bank and Summit Bank until further orders and put off the court hearing to May 5.

The apex court bench comprising Justice Faisal Arab and Justice Sajjad Ali Shah was hearing the suo moto case against the merger at its Karachi registry.

The State Bank of Pakistan (SBP) Governor Jamil Ahmed appeared before the court, informing that the SBP had no objection to the merger of the two banks. He submitted that the State Bank was monitoring the proposed merger of the banks in accordance with the rules and regulation.

Justice Arab remarked that Summit Bank had incurred losses and asked if its merger would have any adverse effect on Sindh Bank.

On the court’s query, the Sindh Bank director informed the judges that the employees of Summit Bank would be paid salaries by the Sindh Bank for one year, after which they can seek new contracts.

He said that the merger would not have any negative effects on Sindh Bank as the banks branches and foreign exchange would increase in the wake of the merger.

The representative of the Summit Bank informed the judges that the proceedings of the merger of the two banks is still in its initial stage.

The court directed the respondents to file a report regarding the proceeding of the merger of the banks and put off the matter to May 5.

Justice Arab remarked that the Chief Justice of Pakistan, who had taken suo moto action against the merger, would decide the case, himself.

The proposed merger faced a setback, after Supreme Court’s suo moto intervention over alleged financial irregularities.