The 85.53 percent shareholders of the total paid up capital of the Summit Bank have approved the amalgamation of the Bank with Sindh bank Limited, Summit Bank sources disclosed. The sources said in a an extraordinary meeting of the shareholders of Summit Bank Limited held the 85.53 percent of the shareholders of total paid up capital of the bank were present personally or by way of proxy, have approved the Scheme of Amalgamation for the amalgamation of the Bank with and into the Sindh bank in Accordance with the provisions of section 48 of the banking Companies Ordinance, 1962.
The sources said that the completion and implementation of the amalgamation is subject to obtaining of all necessary regulatory approvals and compliances including without limitation, with any of the directives of the State Bank of Pakistan and permission of Honorable Supreme Court of Pakistan. The Summit bank also conveyed to the Pakistan Stocks Exchange in accordance with the section 96 of the Security Act , 2015 and clause 5.61 (a) of Pakistan Stock Exchange Limited Regulation.
Banking experts sharing the potential reasons of the amalgamation of the bank told The Business that the Bank was set up in results of amalgamation of Arif Habib bank Atlas Bank, My Bank and Bolan Bank. They said that these banks were suffering from severe infection of non-performing loans (NPLs) and the very reason had not let the Bank flourish.
They added that administrative expenditures shot up and over all expenditures were also inflicting losses to the Bank. The experts’ quoted that the actual value of the bank was not compatible with the book value of the bank.
Sources said that the recently held meeting was important as Arif Motiwal Group opposed the move; however, the bank with the 78 percent voting rights was able to get approval of the 85.53 percent shareholders.
Earlier, the Sindh Cabinet in a meeting approved the merger of Summit Bank with Sindh Bank. The meeting was chaired by Sindh Chief Minister Murad Ali Shah.
He told the cabinet that Sindh Bank was established on the occasion of death anniversary of Shaheed Mohtarma Benazir Bhutto in 2011 by establishing its first branch at Naudero in which former President Asif Ali Zardari opened the inaugural account. The bank established 300 branches within its first three years, he said.