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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

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 Societe Generale.

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 shareholders.

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 Pakistan.

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 day-to-day basis.

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.