BAFL to buy back 200mn ordinary shares

December 06, 2022 (MLN): The board of directors of Bank Alfalah Limited (BAFL) decided to buy back up to 200 million ordinary shares constituting up to 11.25% of the current issued and paid-up share capital, the company’s stock filings on the stock exchange showed on Tuesday.

The issued share is having a face value of Rs10 each, and will purchase at the spot/ current price acceptable to the Bank.

The further report added, “The bank approved the issuance of the proposed additional Tier-I capital of up to Rs10bn inclusive of a green shoe option of Rs3bn in the form of rated, privately placed / DSLR listed, unsecured, subordinated, perpetual, and non-cumulative Term Finance Certificates (TFCs)”.

According to “Instructions for Basel Ill Implementation in Pakistan” issued by the State Bank of Pakistan (SBP) the TFCs, or a portion thereof, should be converted into ordinary shares of the Bank.

1- If so, directed by SBP on the occurrence of a point of non-viability as determined by SBP, at a price equivalent to the market value of the shares of the Bank on the date of the trigger of the point of non-viability as declared by SBP.

2- Upon the occurrence of a pre-specified trigger point pursuant to Basel III Capital Instructions, at a price equivalent to the market value of the shares of the Bank on the date of occurrence of the pre-specified trigger point.

3- Due to any inability to exercise the lock-in clause or non-cumulative features of the TFCs, on such terms and conditions as may be determined by SBP.

Moreover, the issuance of such shares upon the occurrence of any of the conversion events shall be subject to a cap of 322.06mn additional ordinary shares being issued subject to approval from SECP.

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