Pakistan approves bid for First Women Bank privatization from UAE-based entity
Bid exceeds reference price, marking a key milestone in Pakistan’s ongoing privatization efforts
Haris Zamir
Business Editor
Experience of almost 33 years where started the journey of financial journalism from Business Recorder in 1992. From 2006 onwards attached with Television Media worked at Sun Tv, Dawn Tv, Geo Tv and Dunya Tv. During the period also worked as a stringer for Bloomberg for seven years and Dow Jones for five years. Also wrote articles for several highly acclaimed periodicals like the Newsline, Pakistan Gulf Economist and Money Matters (The News publications)
A branch of the First Women Bank in Pakistan
FWBL Facebook
Pakistan’s Cabinet Committee on Inter-Governmental Transactions (CCoIGT) has approved a bid for the privatization of First Women Bank Limited (FWBL).
The winning bid, which exceeded the reference price set for the bank, comes from an entity nominated by the International Holding Company (IHC), based in the UAE. This deal is seen as a crucial part of Pakistan’s strategy to boost foreign direct investment (FDI) and enhance investor confidence in its economic reforms.
At a meeting chaired by Deputy Prime Minister and Foreign Minister, Senator Mohammad Ishaq Dar, officials from the Privatization Commission and key government ministries discussed the privatization, which marks a major milestone in Pakistan’s efforts to streamline state-owned enterprises and encourage private sector participation.
Dar commended the efforts of the Privatization Commission and other stakeholders, expressing satisfaction with the progress made. He reiterated the government’s commitment to ensuring transparency throughout the privatization process and emphasized that such steps are vital for long-term economic stability.
The deal marks an important government-to-government (G2G) transaction between Pakistan and the UAE, reflecting Pakistan’s ongoing push to attract international investment.
The First Women Bank, which holds a paid-up capital of PKR 2.166 billion (below the required minimum capital of PKR 3 billion set by the State Bank of Pakistan), has faced operational challenges. The capital shortfall has limited the bank’s ability to pay dividends and has imposed restrictions on its lending capacity.
Despite these limitations, the sale of FWBL is seen as an important step toward improving Pakistan’s banking sector by addressing inefficiencies and promoting private sector involvement.
Bank's financial performance
The bank’s net mark-up interest income dropped by PKR 560 million, a 27% decrease, while its non-mark-up income grew by PKR 104 million, reflecting an increase of 111%.
The bank’s total income declined by PKR 456 million in 2024, marking a 21% drop compared to the previous year. On the expense side, the bank saw a 4% increase in non-mark-up expenses, adding PKR 60 million. Despite this, the bank’s profit before provision showed a dramatic 83% decline, dropping by PKR 515 million.
FWBL reported a profit before tax of PKR 268 million for the year 2024, down from PKR 457 million in 2023, and a post-tax profit of PKR 79 million, significantly lower than PKR 322 million in 2023.
On the asset side, the bank reported a 10% decline in advances, alongside a 17% increase in investments. Deposits increased slightly, by 1%.
Comments
See what people are discussing