Research Analyst
5 - 11, 2012

Khushhali Bank Limited operates under the supervision of the State Bank of Pakistan (SBP) and many central (commercial) banks are its shareholders. The mandate remains to retail microfinance services and to act as a catalyst in stabilizing the country's newly formed microfinance sector.


Total revenue (Rs) 1,471,489,809
Operating profit/loss(Rs) 69,654,034
Net profit/loss(Rs) 188,138,462
Average ROA 0.8%
Average ROA 2.6%

The bank's Karobari Munafa account is a secure and convenient account that takes care of their customer's transactional needs to help them take one small step towards managing their business more effectively. While, the bank's Behtreen bachat account is perfect choice for customers with moderate transactional needs.

Furthermore, western union money transfer facility is a remittance channel launched across select KBL branches in Pakistan. It facilitates Pakistani expatriates across the globe to remit their money back home in a safer, secure and hassle free mode under a tie up with western union.

The bank also operates on a community based service delivery mechanism and forms client clusters to reduce transactional costs. The bank's line of products includes short-tenure micro loans ranging up to US$500 for working capital and asset purchase. It also proactively mobilizes deposits and provides counseling services to its clients and continues to expand its range of services to address client needs.

Khushhali Bank was a part of the Government of Islamic Republic of Pakistan's Poverty Reduction Strategy and its Microfinance Sector Development Program (MSDP). MSDP was developed with the facilitation of Asian Development Bank (ADB). The bank has proactively encouraged formation of alliances with NGOs and has recognized their role in poverty reduction efforts as envisaged by the Government of Pakistan's Microfinance Sector Development Policy.

Khushhali Bank benefits at the hands of an endowment fund, coined as MSDF (Microfinance Social Development Fund). This unique arrangement allows Khushhali Bank to disseminate specialized social services through the alliances with NGOs while it delivers financial services to market segments of a similar nature.

Khushhali Bank collaborated with development organizations consistently which helped in further accessibility towards clients to provide them microfinance services. Khushhali Bank understood the significant requirements of these clients and gained knowledge in fields of education, health, population control, empowerment, social mobilization, training and development which are the basic tenets within this segment.

In turn, these NGOs and organizations also grew in line with the bank as well as the micro credit requirement of the communities in which they are serving, has been adequately addressed. This is a unique model and the bank looks to continuously strengthen the ties between the formal microfinance sector and the development sector.

KBL, in an effort to provide some respite to the affected, capitalized on its longstanding relations with various NGOs and service provider agencies to help mobilize poor households into community groups and provide group members with financial and social services. Hence, KBL leveraged upon its established experience and developed the Earthquake Livelihood Rehabilitation Program (ELRP). Furthermore, the graduate clients of the rehabilitation phase were provided access to KBL's mainstream financial and social services and over 9,500 community groups were formed for the provision of equity support and working capital loans, reaching over 70,000 households and restoring their livelihoods.

The banks' Jafakash Aurat project was a unique project for the women folk who not only believe in hard work but also have confidence in themselves. The main objectives of the project were to improve income generation of the poor women by developing and strengthening their skill and entrepreneurial capacities and giving them access to micro financing opportunities.

Such efforts serve to foster a sense of confidence within people, enabling them to take up jobs and start their own business owing to which they can contribute positively towards the house hold income as well as the overall prosperity of the entire family.

The Project in Gwadar was an extremely successful project that achieved most of the mile stones outlined in the project brief. It served to train about 4,500 women, whereas around 695 women were provided micro credit loans. In line with overall strategy of Khushhali bank to strengthen its' role and brand image in marginalized territories and attract to promote education and enhance accessibility to educational institutions as part of its social corporate responsibility mandate, KBL commenced Khushhali Bank Scholarship Scheme (KBSS) during 2005.

A total of 332 scholarships amounting to PKR76,890,465 have been awarded in 2009, to domicile holders of Sindh, Balochistan and FATA, of which 244 scholarships valuing Rs. 52,548,012 were awarded to domicile holders of tribal areas. A total of 62 students have completed their degrees during the same period.


The bank recorded a profit before tax of Rs188 million for the year 2010 which is lower than last year's of Rs252 million primarily as a result of fall in non-core grant income from Rs250 million to 98 million. The bank continues to pursue a sustainable growth strategy with reliance on core business reducing grants/subsidies and the overall sustainability indicators reflect improvement from 99 per cent last year to 105 per cent during 2010. The devastating floods of August 2010 affected a large part of the branches and business in some of the most potential areas of the country, and correspondingly suppressed growth in portfolio and revenues.