The board of directors at BankIslami decided to exit from the business of Modaraba by divesting all its shares from its subsidiary – BankIslami Modaraba Investment Limited.
According to a stock filing to the Pakistan Stock Exchange (PSX), the bank’s management carried out the sale of 8 million shares of BankIslami Modaraba Investment Limited representing 100 percent issued and paid-up share capital of the subsidiary to Atique Ahmed Khan, a sponsor, and CEO of the Ghani Global Group.
The bank has received all regulatory approvals from the Securities and Exchange Commission of Pakistan (SECP) for the due process and the transaction of the deals stands completed.
The asset value of the Modaraba stood above Rs. 2 billion. However, the company did not disclose the sale value in its stock filing.
The subsidiary company was incorporated in Pakistan in 1986 as a Modaraba Company. The principal activity of the subsidiary company is to float and operate Modaraba. The subsidiary company is managing its Modaraba with the name of Modaraba-Al-Mali.
Various commercial banks also got rid of their subsidiaries of the Modaraba in the past as the business of this sector has been struggling for the last decade.
BankIslami Modaraba Investment Limited is no longer a subsidiary of BankIslami Limited, the stock filing stated.
