KARACHI, April 5: The United Bank Ltd (UBL) said on Saturday the government would offer a portion of the shares it holds in the bank for public listing on the stock market.

The bank will offer its shares to small investors in the future, UBL chairman Shaikh Nahayan Mubarak Al Nayahan told a news conference.

The bank’s president, Amar Zafar Khan, said the initial listing would come from the government, which still holds a 49-per cent minority stake in the bank.

But the date, size and other details for the public offering have not been decided yet, he said.

At the current market level, UBL will get a lower price per share compared to rates at which they were sold to strategic investors, he said.

The Abu Dhabi Group & Bestway Holdings acquired a 51 per cent stake in UBL for Rs12.35 billion last September.

The privatization of UBL, Pakistan’s fourth-largest bank, was the first major sell-off in the financial sector for five years.

With 1,101 branches, UBL has a nine per cent market share.

Nayahan said his bank remained committed to playing a vital role in boosting Pakistan’s economy and planned major investments in various sectors. But he declined to give further details.

Khan said the bank had launched new instruments to keep its operations viable and profitable.

The State Bank of Pakistan has slashed its key discount rates to 7.5 per cent from nine in November and banks are finding it increasingly difficult to maintain their profits in the low interest rate environment.

Khan said UBL planned investments in the agriculture sector as it believed it would play a leading role in boosting economic growth and serve as a major contributor to foreign exchange.

The United Bank’s net profit increased to Rs1,437 million during the first year of the privatization in 2002 with 15 per cent increase in deposits.

UBL president Amar Zafar Khan stated this while addressing a press conference on the occasion of the UBL’s first Annual General Meeting after its privatization in 2002, at a local hotel on Saturday.

“There was a marked improvement in the capital adequacy, asset quality and efficiency,” Khan said.

The bank’s pre-tax profits increased by 88 per cent to Rs2,756 million from Rs1,472 million in 2001, he said adding that deposit increased to Rs161,669 million against Rs140,736 million in 2001.

The UBL president said the year 2002 marked the beginning of a new era in the history of the bank. The total assets of the bank increased by 14 per cent to Rs191,821 million in 2002 against Rs168,623 million in 2001, he said adding that the shareholders’ equity increased to Rs12,434 million against Rs2,451 million in 2001.

Khan said that the bank has introduced many new products and services and more were in the pipeline.

The bank launched the United Money Fund (UMF), the first ever open-ended fixed income fund. The UMF is aimed at investors seeking yields higher than deposit rates of safer banks, or alternative investment channels to the related savings schemes.

Moreover, he said the bank has introduced a web/Internet based account enquiry service, called “UBOnLine” to enable its customers to access information on their accounts using their computers or mobile phones, without needing to travel to the bank.

Further benefits like on-line transfer of funds, utility bill payments and online investments were in the pipeline.

Another facility “Uniremote” inter-branch banking was being introduced at all activated hubs, to ultimately enable the customers to transact from any online branch throughout the country.

The other facilities include “TezRaftaar” free-of-cost remittance transfer product and Credit Cards in UAE, Bahrain and Qatar with a 24-hour Call Centre of UAE.

Prominent among those who attended the conference included Advisors to the Prime Minister Dr. Abdul Hafiz Shaikh and Shaukat Aziz, Chief Ministers of Sindh and Punjab Sardar Ali Mohammad Mahar and Chaudhry Pervez Illahi, Governor, State Bank of Pakistan (SBP) Dr. Ishrat Hussain, former Home Minister Lt. Gen. (Retd.) Moinuddin Haider, senior bankers and representatives of the Pakistani business community.

Meanwhile, Adviser to the Prime Minister for Investment and Privatization Dr. Abdul Hafeez Shaikh talking to the newsmen after attending the UBL AGM, said that the newly-formed Privatization Board would decide about privatization of PTCL, Habib Bank and PSO in its next meeting on April 7 and 8.

Dr. Shaikh said that the board would make decisions how to expedite the privatization process.

“We have not received any request for extension of date for privatization of PSO from the potential bidders,” he said in a question that whether the government has not received any request for extension of the bidding date due to Iraq war.

“We are in touch with the bidders,” he added.

The Privatization Commission had earlier fixed the PSO bidding date on April 26.

He, however, said that no such request has been received from any interesting party.

The next meeting would decide about timeframe for privatization of HBL, he added.—Reuters/APP