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6-month moratorium by SBP: Askari, Sindh banks allowed diligence of KASB Bank

6-month moratorium by SBP: Askari, Sindh banks allowed diligence of KASB Bank

KARACHI: Following imposition of a six months moratorium over failure to meet its mandatory financial requirement, the State Bank of Pakistan (SBP) has allowed to Askari Bank and Sindh Bank to carry out due diligence of KASB Bank.

Both the banks are being considered as mid-tier and emerging banks with moderate profitable operations and therefore the SBP permitted them to conduct financial and technical assessment instead of large banks which have already expanded their operation countrywide.

Askari Bank and Sindh Bank have been in talks with the KASB Bank management to conduct due diligence.

The due diligence of the bank caused possibilities of the merger of KASB Bank with any of the two banking companies; however more banks are likely to join race for showing their interest in the buyout of the bank.

KASB Bank has been imposed with a moratorium by SBP for the period of six months because of failure to meet its mandatory financial requirement, mainly the paid-up capital. As the process of financial and technical evaluation is completed later on, any of the two banks will finally enter into negotiations based on price and transfer of assets. In the case of any deal settlement between the two banking companies, the central bank will review and give its final consent related to merger and acquisition.