Another agreement between the two banks is also
going to strike that is purchase of a 10 per cent stake in Al-Meezan
Bank by Societe Generale
By AMANULLAH BASHAR
Feb-18 24, 2002
Pakistan's first Islamic Commercial Bank i.e.
"Al-Meezan Commercial Bank Limited" is about to take a big
stride with the launch of its banking operations, initially in major
cities i.e. Karachi, Lahore and Islamabad.
The State Bank of Pakistan (SBP) has already issued a
license for setting up the first scheduled Islamic commercial bank in
the country. The granting of the license is the major step towards the
introduction of banking based entirely on Islamic principles.
Irfan Siddiqui, Chief Executive of the bank told PAGE,
that his bank is intended to acquire Pakistan operations of the French
bank Societe Generale operating with 4 branches in Pakistan. According
to Irfan Siddiqui, his bank to launch its operations would acquire the
assets of the Societe Generale worth Rs3 billion. The management of the
two banks is negotiating to finalize the deal and probably the new bank
would go into operations some time next month.
Another agreement between the two banks is also going
to strike that is purchase of a 10 per cent stake in Al-Meezan Bank by
Irfan said that we are in an advanced stage of
negotiations with Societe Generale and by the end of this month all the
four Pakistani branches of Societe Generale would be amalgamated in Al-Meezan.
Al-Meezan already running an investment bank based on
interest free financial services. Irfan said that Pakistan's first
Islamic commercial bank would endeavour to capitalize the entire network
of Societe Generale and its credit resources which would certainly give
an edge over in the market.
Replying to a question, Irfan Siddiqui said that we
are going into business purely on professional standards and services
and not just to attract the customers prone to religion. It is the
quality and credibility of the services, which matters, and not merely
the religious sentiments. He said that the market has given our
investment bank a good response and hopefully the Islamic commercial
bank would also be a step ahead of others.
The sponsors of the Bank are leading financial
institutions which include Pakistan Kuwait Investment Company (Pvt.)
Limited, which is rated with "AAA" status in Pakistan, Shamil
Bank E.C, one of the leading banks based in Bahrain, Islamic Development
Bank, Jeddah, Kuwait Awqaf Public Foundation and Saudi Pak.
The license to set up the first scheduled Islamic
commercial bank was given recently by Dr. Ishrat Hussain, Governor SBP,
to Irfan Siddqui the Chief Executive of Meezan Bank Limited.
Meezan Bank is capitalized with an equity base of
approximately Rs1.3 billion.
According to Irfan Siddiqui, CEO of the newly
established Islamic bank, the Meezan Bank has ambitious plans for
expansion of its branch network "Islamic banking as a banking of
first choice is the vision of Meezan Bank and added that Bank has very
successfully launched deposit product 'Riba Free' which is very well
received in the market.
Speaking on the occasion, the SBP governor said that
Meezan Bank would be the first model Islamic Commercial bank in Pakistan
and is expected to play a pioneer role for other banks.
The governor appreciated the efforts of the bank in
the area of product development and said that Meezan Bank has to
demonstrate its ability to satisfy the needs of depositors and the
The Chairman of the Board of Directors of Meezan Bank
is Shaikh Ebrahim bin Khalifa Al-Khalifa, who is the Deputy Finance
Minister of Bahrain. Meezan Bank's shareholders also include Societe
Generale, Paris, who would have 10 per cent stake in the Bank.
Meezan Bank is in the final stage of negotiation with
Societe Generale to acquire their operations in Pakistan and it is
expected that the deal will be finalized soon. As part of the deal,
Meezan Bank will acquire all the four branches of Societe Generale in
Pakistan. Out of the 4 branches two are operating in Karachi while one
each in Lahore and Islamabad.
It is only because of inherent strength of Meezan
Bank that Societe Generale Paris has also agreed to invest 10 per cent
in Meezan Bank.
The State Bank of Pakistan has already released
detailed guidelines for setting up of Islamic Commercial Bank in
Upon completion of all requisite formalities, the SBP
approved the application of Meezan Bank.
The management of Meezan Bank comprises highly
professional and experienced bankers committed to Islamic Finance.
The Bank's Shariah Advisor Dr. Imran Usmani, a Ph.D.
in Islamic Finance will monitor the activities of the Bank on a
In addition the bank has a high-powered Shariah
Supervisory Board that is chaired by Justice Muhammad Taqi Usmani who is
an eminent Islamic Scholar of international repute. He also supervises
the activities of other leading Islamic banks internationally.
Meezan Bank limited; the first Islamic Commercial
bank in Pakistan is expected to set up a network of branches throughout
the country so that the benefit can be availed everywhere.