KARACHI, Sept 11: JS Bank Ltd on Tuesday signed a sale and purchase agreement with HSBC Bank Middle East Limited for the acquisition of HSBC-Pakistan operations.

HSBC said it had agreed to sell its Pakistan operations, which comprises of 10 branches, to JS Bank a day earlier in London. However, the sum of the deal has not yet been disclosed.

JS Bank informed its shareholders through a notification to the Karachi Stock Exchange that the sale/purchase agreement sets out a methodology for the determination of the sale price which will be finalized by the date of completion of sale which is expected by the end of this year.

HSBC as part of its global restructuring decided to sell off small assets or less profitable operations in several countries including Pakistan.

The bank is in serious trouble on a global level as it has been facing highly damaging allegations such as money laundering in Mexico and interest rate manipulation.

At least a dozen banks are being investigated by regulators worldwide for rigging the rate and regulators from Stockholm to Seoul are reexamining how benchmark rates are set. At least three institutions were competing to buy HSBC Pakistan operations including Isbank of Turkey.

The banking circles prior to the announcement thought that Turkey’s Isbank stood a better chance of acquiring HSBC Pakistan since it’s a larger bank with presence in several countries.

The SBP said it had not yet been informed about the deal between JS Bank and HSBC.

“Neither we have been officially informed nor we have been approached for approval of the deal,” said the State Bank’s spokesman.

The State Bank has to give the final approval for the deal between the two banks.

Bankers view the deal as a positive development as a local bank offering a better price to acquire HSBC Pakistan reflected the strength of the banking sector in Pakistan.