KARACHI – A Singapore-based majority shareholding company of the NIB Bank has injected Rs 6.40 billion ($74.08 million) into the bank. Bugis Investments, a wholly owned subsidiary of Fullerton Financial Holdings of Singapore, has injected its share of the proposed capital increase of Rs 6.4 billion in the bank, NIB announced on Friday. It said in August last year the NIB Bank had shown its intention to increase its capital with a view to make the bank stronger. To this end, the bank said, the majority shareholder of NIB Bank, Bugis Investments has injected its share in the bank as of December 30, 2010 that has also been confirmed by the KPMG Taseer, Hadi and Co, the auditors of the bank.
The capital injection into the NIB Bank would further strengthen the financial health of the bank that is facing losses from the acquisition of PICIC and the PICIC Commercial Bank. The value of the share of NIB bank at the Karachi Stock Exchange has been moving in the range of Rs 2.90 to Rs 3.15 for the past many months because of consistent losses to the bank, increase in the base of the shares of the bank that mopped up Rs 12 billion by offering right shares in 2009. Despite being one of the leading banks in term of paid up capital, the NIB bank is unable to give any reward to its shareholders since the acquisition of the PICIC.
The NIB Bank (formerly NDLC-IFIC Bank Limited) was incorporated in March 2003 as a publicly listed company. In October 2003, all assets and liabilities and all rights and obligations of the former National Development Leasing Corporation (NDLC) and Pakistan operations of IFIC Bangladesh were amalgamated with and into NIB Bank. In April, 2004 the Pakistan operations of Credit Agricole Indosuez (the Global French bank) were also amalgamated with and into NIB Bank. In June 2005, Temasek Holdings of Hongkong through Bugis Investments (Mauritius) Limited acquired over 70 percent shares in the capital of NIB Bank. NIB Bank has acquired another local financial group, Pakistan Industrial Credit and Investment Corporation (PICIC), with nearly 170 branches. NIB is now the 7th largest bank in Pakistan in terms of balance sheet size and capital.
