The shareholders of Silkbank Limited have approved the amalgamation of the bank with and into United Bank Limited (UBL), subject to regulatory clearances from the State Bank of Pakistan (SBP) and the Competition Commission of Pakistan (CCP).
The decision, which follows UBL’s offer dated October 31, 2024, for the proposed merger, was made at an Extraordinary General Meeting held on Thursday, December 26, 2024. The shareholders passed resolutions confirming the minutes of the 28th Annual General Meeting held earlier on December 6, 2024.
According to a PSX filing, under the approved resolution during the Extra Ordinary General Meeting, Silkbank’s President & CEO Shahram Raza Bakhtiar, CFO Khurram Khan, and Company Secretary Faiz Ul Hasan Hashmi have been authorised to execute all necessary actions, including making modifications to the amalgamation scheme, submitting it to the SBP for approval, and coordinating with relevant legal and regulatory authorities.
On November 1, 2024, as consideration for the amalgamation, UBL proposed to issue and allot new UBL ordinary shares to the shareholders of Silkbank based on a ratio of one (1) new UBL ordinary share for every 325 Silkbank ordinary shares.
In response, Silkbank’s Board of Directors gave in-principle approval for the potential merger on November 6, 2024. The Board also authorized the bank’s Chief Executive Officer to engage advisors and consultants to evaluate UBL’s offer and present their findings for further consideration.
The merger is expected to have significant implications for both banks, with Silkbank shareholders poised to become part of UBL’s wider operational framework, pending regulatory clearances.
Silkbank published its 2022 financial statements in December 2024, revealing a negative equity of Rs 13.9 billion at the end of 2022. This figure falls significantly short of the minimum capital requirement of Rs 10 billion.
