MCB Bank Decides To Conduct Due Diligence Of Silk Bank, Informs PSX About Its Decision
MCB Bank has decided to conduct the due diligence of the Silk Bank with the intention to acquire the bank.
The board of the MCB Bank has given its formal approval to the bank to initiate due diligence of the Silk Bank, founded by former finance minister Shaukat Tareen.
The Mian Mansha’s Bank has announced this in a letter written to the Pakistan Stock Exchange to fulfil its regulatory requirement.
Also, the MCB Bank is seeking regulatory approval from the State Bank and the SECP to initiate the due diligence of Silk Bank. The acquisition of the Silkbank will solely depend on the due diligence of the bank, according to capital market experts.
UBL conducts due diligence
Earlier, in April this year, United Bank Limited sought permission from the State Bank of Pakistan to conduct due diligence on Silk Bank before finalizing its acquisition.
As the MCB Bank has sought permission from the SBP for due diligence of Silk Bank, it is believed that the UBL has dropped its plan of buying Tarins’ bank.
According to media, Silkbank has been making losses for years. In 2020, the bank’s accumulated losses increased to Rs20 billion.
The bank is in desperate need of new capital to meet regulatory requirements. Its capital stood at Rs3.16bn against the prescribed minimum capital requirement of Rs.10bn at the end of 2020.