SBP Allows Bank Alfalah to Raise Rs. 20 Billion to Absorb Losses

Bank Alfalah Limited has received final approval from the State Bank of Pakistan to raise Rs. 20 billion in Tier 2 capital through the issuance of redeemable capital instruments.

In a notice submitted to the Pakistan Stock Exchange on Thursday, the bank said the capital will be raised through Term Finance Certificates to be privately placed and potentially listed later in accordance with debt securities listing regulations.

The issuance will comply with the Basel III guidelines issued by the State Bank and Section 66 of the Companies Act, 2017.

Tier 2 capital serves as a supplementary buffer for banks, helping strengthen their capital base, absorb losses, and support future lending growth. The transaction remains subject to the execution of relevant documents and fulfillment of other applicable conditions.

Bank Alfalah is one of Pakistan’s largest private banks, with a network of more than 1,000 branches and an expanding digital banking presence.

The lender is majority owned by Abu Dhabi’s Abu Dhabi Group and has regularly tapped debt markets to optimize its capital structure and maintain strong capital adequacy ratios as banking regulations become more stringent under Basel III standards.