ISLAMABAD: Responding the an adjournment motion, moved by Senators Osman Saifullah Khan, Muhammad Ali Saif and Saeed Ghani, Senate Chairman Mian Raza Rabbani has referred the matter of the merger of KASB Bank with BankIslami to the Senate Standing Committee of Finance for Investigation.
State Minister for Petroleum and Natural Resources Jam Kamal did not oppose referring the issue to the committee and responded that the interests of account holders of defunct KASB bank had been protected and no employee of the bank would be retrenched. The BankIslami has been allowed to merge KASB by the State Bank after following transparent procedure and rules, he added.
The state minister said that a total of Rs4.8 billion had been paid to 150,000 account holders of the KASB, while each account holder was allowed to draw Rs300,000 from his account. He said the shareholders of KASB would benefit from the merger, as the price of its share would increase after merger with a sound bank. He said various banks, including Askari Bank, Sindh Bank, JS Bank and BankIslami, had contacted the State Bank for the merger. On receiving reports of negative reports about KASB, he said the State Bank had issued notice to KASB asking it to improve its financial condition.
Earlier, Senator Osman Saifullah Khan said the KASB bank was enduring losses since 2009, as the price of its share decreased to only 70 paisa from Rs12. He said it seemed that the State Bank had not fulfilled its responsibilities as a regulator. Ghani criticised the merger of KASB Bank with BankIslami and demanded a probe in this regard. Senator Latif Ansari said the deposits of the account holders should be secured and protected.
