The State Bank of Pakistan (SBP) has approved the merger of Silk Bank Limited (SBL) into United Bank Limited (UBL), with the amalgamation taking effect from March 11, 2025.
UBL and Silk Bank shared this development through separate notices to the Pakistan Stock Exchange (PSX) on Tuesday.
“State Bank of Pakistan (SBP), vide its Sanction Order dated 10 March 2025 has sanctioned the Scheme of Amalgamation of Silk Bank Limited (SBL) with and into United Bank Limited (UBL) under the provisions of Section 48 of the Banking Companies Ordinance 1962 (BCO) effective from the date jointly notified by UBL and SBL and approved by the SBP. The Scheme of Amalgamation has been sanctioned by the SBP on the terms and modifications set out in the Sanction Order,” read UBL’s notice sent to the PSX.
As per the SBP’s Sanction Order dated March 10, 2025, Silk Bank has ceased to exist as an independent entity and now stands fully integrated into UBL. The merger was carried out under Section 48 of the Banking Companies Ordinance 1962, with the approval of both banks and the SBP.
Under the terms of the approved Scheme of Amalgamation, UBL will issue new ordinary shares to Silk Bank’s shareholders based on a swap ratio of one UBL share for every 25 Silk Bank shares. Shareholders registered as of March 10, 2025, will be eligible for this conversion, subject to the completion of corporate and regulatory formalities.
In accordance with the Scheme of Amalgamation as sanctioned by the Silk Bank pursuant to the Sanction Order, new ordinary shares of UBL will be issued to the shareholders of Silk Bank, who registered as the shareholders of Silk Bank on the final book closure date announced by Silk Bank (i.e., 10 March 2025), under the swap ratio being one (1) new ordinary share of UBL having a face value of PKR 10/- per share for every twenty-five (25) ordinary shares of Silk Bank having the then prevailing face value of PKR 10/- per share, subject to necessary corporate and procedural requirements.
Following the merger announcement, Silkbank’s stock gained 3.51%, trading at Rs1.18 per share as of 10:24 am. In contrast, UBL’s stock showed a slight decline and was trading at Rs390.99, down 0.33% as of 10:24 am. Investors reacted cautiously to the deal, with trading activity showing mixed sentiment.
In December last year, Silkbank shareholders approved the amalgamation of the bank with and into UBL which was subject to regulatory clearances from the State Bank of Pakistan (SBP) and the Competition Commission of Pakistan (CCP).
The merger is expected to strengthen UBL’s market position by expanding its customer base and asset portfolio.
