August 19, 2024 (MLN): Bank Alfalah Ltd. (PSX: BAFL) is open to further acquisitions to boost growth as the South Asian nation tries to emerge from a chronic economic crisis, as reported by Bloomberg.
The lender is in the final stages of reaching an agreement to acquire Saudi National Bank’s majority stake in Samba Bank Ltd., Chief Executive Officer Atif Aslam Bajwa said in an interview. Closing that deal should make Bank Alfalah a contender for future assets that go up for sale, he said.
“One-off opportunities will come by, and we want to be in play for that,” Bajwa said. “We’re looking for organic and inorganic growth.”
Bank Alfalah is Pakistan’s fourth largest lender by assets and is owned by United Arab Emirates-headquartered Abu Dhabi Group.
It has seen the second fastest deposit growth in the past five years among Pakistani banks, according to data compiled by Bloomberg.
That growth has come as its home country has been lurching from one loan to another from the International Monetary Fund to keep up with its debt payments that stand at about $26 billion for the year started July.
The nation expects the IMF’s executive board to approve a new $7bn loan program later this month.
Pakistan has also asked China to “reprofile” some of its debts by extending payment period to create more breathing room.
“The IMF program is paramount for the country to achieve because that will help in giving confidence to the rest of the world,” Bajwa said.
Pakistan’s central bank cut the policy rate by a cumulative 250 basis points in June and July from a record 22%. Inflation slumped from a record 38% in May 2023 to 11% in July.
The central bank’s efforts have been supportive to Pakistan’s equity markets, Bajwa said, noting he expects interest rates to fall to single digits by 2025.
“The equity markets have been responding quite nicely,” he said.
The benchmark KSE-100 Index has rallied 71% in dollar terms in the past year, making it the best performing stock market globally. “Some foreign funds have started coming back into the market to give it some support.”
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Posted on: 2024-08-19T11:45:08+05:00
