UBL Wins SBP Approval For Due Diligence of Telenor Microfinance Bank

United Bank Ltd (UBL) is going to conduct due diligence of Telenor Microfinance Bank Ltd (TMBL) for a potential purchase of 55 per cent shareholding that the Telenor Group controls in the micro-lender. With a market share of 30.2 % in terms of the number of active savers, TMBL is the second largest provider of micro-savings in Pakistan. United Bank Ltd is the fourth largest commercial bank with respect to the total value of shares listed on the national stock exchange.

UBL Wins SBP Approval For Due Diligence of Telenor Microfinance Bank

The Telenor Group increased its shareholding in the micro-lender to 100pc in 2016. Two years later, it sold 45% shareholding to Alipay (Hong Kong) Holding Ltd for $184.5 million. This means TMBL as a whole was worth $410m in 2018.

See Also: Telenor Microfinance Bank selects PTCL to expedite the bank’s Digital Transformation journey

On the other hand, TMBL posted a net loss of Rs7.6 billion in the first nine months of 2021 versus a net loss of Rs7.9bn in the comparable period a year ago. Its accumulated losses amounted to Rs34.8bn at the end of September 2021 versus Rs27.2bn at the beginning of the same year.

Its latest half-yearly report said the bank’s shareholders injected equity amounting to Rs14bn or $86m in 2020 and 2021 to mitigate the impact of losses. “A further capitalisation plan has also been approved by the board of directors,” it added. The accompanying auditors’ review report said the existence of material uncertainty may cast significant doubt about the bank’s ability to continue as a going concern.

In November 2021, MCB Bank Ltd also showed interest in purchasing a 55pc stake in Telenor Microfinance Bank Ltd.

In addition to the microfinance business, the Telenor Group is also looking for merger opportunities with respect to its telecom business in Pakistan.

Last November, a story by news agency Reuters quoted the CEO of the Norwegian telecom operator as saying that the global entity “will continue to look for merger opportunities in Asia, including in Pakistan and on a regional basis”.

Check Also: Telenor Microfinance Bank wins ‘The Innovators 2020’ Award

Source: Dawn News

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Onsa Mustafa

Onsa is a Software Engineer and a tech blogger who focuses on providing the latest information regarding the innovations happening in the IT world. She likes reading, photography, travelling and exploring nature.

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