KARACHI: Keeping the aggressive strategy of expanding banking operations, Habib Bank Limited (HBL) has been allowed by the State Bank of Pakistan (SBP) to enter the microfinance banking by acquiring First Microfinance Bank in term the value of savings.
Accord gin to the Karachi Stock Exchange notification, HBL management intends to look at acquiring significant shareholding in First MicroFinance Bank, which already has a base in microfinance sector all over Pakistan.
Pakistan’s largest conventional bank with total assets of over Rs1.7 trillion, HBL operated nearly 1,600 branches at the end of 2014 and is in process to acquire operation of Barclays Bank to tap corporate and high-end customer market besides it has laid its focus on big market of microfinance.
Aga Khan Agency for Microfinance (AKAM) is holding a major share in First Microfinance Bank whereas other shareholding constitutes 22 percent share of Aga Khan. Rural Support Programme (AKRSP), 18 percent share of International Finance Corporation and 18 percent share of Japanese International Corporation Agency.
According to centralised databank for the microfinance banking industry, First Microfinance Bank’s total value of savings at the end of 2014 was Rs8.7 billion with a market share of 20.1%. Its gross loan portfolio was over Rs5 billion, which made it the fifth largest provider of microcredit with a market share of 7.6%.
