Bank Al-Habib has been granted permission from regulatory authorities to acquire 70 percent stakes of its subsidiary, Habib Asset Management Company Limited at a cost of Rs. 152 million.
According to a financial report, the bank has received regulatory approvals from State Bank of Pakistan (SBP), Securities & Exchange Commission of Pakistan (SECP), and Competition Commission of Pakistan (CCP), for acquiring the remaining 70% in addition to the already owned 30% of the issued and paid-up capital of Habib Asset Management Limited (HAML) from its existing shareholders at a price of Rs. 7.25 per share, amounting to Rs. 152,250,000.
As per the plan, the bank will inject additional equity of up to Rs. 450 million in its 100 percent owned subsidiary.
The bank will get control over the subsidiary with the formal approval of shareholders in the forthcoming Annual General Meeting.
Recently, commercial banks such as Faysal Bank and Askari Bank have also acquired 100 percent stakes of their subsidiaries dealing in asset management mainly to shore up their channels to boost the business and earnings from them.
Leading commercial banks such as United Bank Limited, Allied Bank Limited, Meezan Bank Limited also own assets management companies as their 100 percent owned subsidiaries which contribute handsome income to the profitability to their banks.