Summit Bank’s board of directors has revised the value of its shares to 4.17 against one share of Sindh Bank in the connection of the amalgamation of the two banks.
Previously, the board had set a share value at 3.85 against one share of Sindh Bank in August, 2017.
“Board of directors has approved the revision in swap ratio from (1: 3.85) to (1: 4.17) in respect of the proposed amalgamation of the bank with and into Sindh Bank Limited. Now thereof, 1 ordinary share of the bank of Sindh Bank is proposed to be issued for every 4.17 ordinary share of Sindh Bank as a consequence of this proposed merger scheme of the two banks,” the stock filing added.
The board, in the last meeting, approved the scheme of amalgamation of Summit Bank with/into Sindh Bank Limited subject to the approval of the banking and its shareholders.
In the next step, the management of the bank will obtain approval from the general shareholders in the upcoming meeting to be held on November 7 in Serena Hotel , Islamabad.
The bank will offer its share with revised value to shareholders of the bank once it has been approved by the required authorities. Alternatively, it will offer money to the shareholders who wish to offload shares of the bank in the future.
Summit Bank has been struggling to be a profitable bank since its formation. It has posted a loss of Rs. 292 million in the second half of the 2017 against losses of Rs. 1.04 billion posted in the same period last year. The bank even posted a profit of Rs. 106 million in the first quarter of 2017.
The improvement in the bank’s balance sheet will bode well for the proposed merged bank.