Pakistan’s Bank Islami Ltd. will take over KASB Bank Ltd., one of the country’s smallest lenders, as part of a rescue operation organized by the central bank. The State Bank of Pakistan has placed a “token nominal value” on KASB Bank shares in the transaction, according to separate statements sent by the banks to the Karachi Stock Exchange on Tuesday.
KASB’s operations have been under a central bank moratorium since Nov. 14, with withdrawal limits for depositors due to concerns about the company’s financial health. KASB’s brokerage subsidiary also was temporarily closed.
KASB shares plunged a record 28 percent to 2.43 rupees in Karachi trading Tuesday. Earlier reports about a merger had caused the bank’s shares to surge last week.
Bank Islami’s directors will consider the takeover plan at a meeting on Wednesday, the bank said in its statement.
Source: Bloomberg
