Pakistan Housing Finance Company (PHFC) has offered to inject equity up to Rs12 billion into Silkbank Limited, according to a statement shared with the Pakistan Stock Exchange (PSX) on Wednesday.
PHFC is leading a consortium of like-minded investors supported by the experienced management of M/s. Burj Capital, who have successfully set up and managed Islamic and conventional banks in Pakistan.
The statement also noted that the Arif Habib Group is willing to participate in the consortium as a minority stakeholder, and PHFC has informed Silkbank of its intention to conduct due diligence subject to State Bank of Pakistan (SBP) approval.
Silkbank, a full-service commercial bank, has been struggling with financial issues, with its capital adequacy ratio below the minimum regulatory requirement of 11.5%. Last month, the bank had announced that it had entered into discussions with several potential investors, including Burj Capital, to raise additional capital.
PHFC’s offer of an equity injection comes as a welcome development for Silkbank, which has been looking to raise funds to strengthen its balance sheet and meet regulatory requirements. The bank has been exploring several options to raise capital, including rights issues, share placements, and asset sales.
If the equity injection is approved by the SBP, it would provide much-needed relief to Silkbank, which has been struggling to keep up with its peers in the banking sector. It would also allow the bank to invest in its operations, technology, and infrastructure, and improve its customer offerings, which would ultimately benefit its stakeholders.
Overall, the move by PHFC to offer an equity injection into Silkbank is a positive development for the banking sector in Pakistan, as it would provide much-needed capital to a struggling bank and help to strengthen the country’s financial system.
