KARACHI, Nov 20: Crescent Commercial Bank (CCBL) on Monday announced that it had struck a deal last week with Saudi financial group Samba for selling 68 per cent shares of the bank.

The CCBL or CresBank said that it would issue additional 600 million shares, at par value of Rs10 each, enabling the Saudi group to acquire the maximum control over the bank.

According to the deal the Samba group would inject Rs6 billion into CresBank and the board of director of the bank had already approved the investment plan.

The bank and Crescent Group have been in trouble for the last three years and the existing shares of the bank are 277 million.

The Rs6bn injection by the Saudi group would make the CresBank with second highest paid-up capital at Rs8.8 billion in the country as the paid-up capital of Standard Chartered Bank after acquiring Union Bank rose to Rs38.7 billion. However, National Bank of Pakistan will be stood at 3rd position with Rs7 billion paid-up capital.

After the liquidity injection the board of directors of the CresBank would be reconstituted to reflect the revised ownership structure. However, banking sources said that the management would be the same as was witnessed in the case of Habib Bank.

“The CresBank is comparatively a smaller bank with just 18 branches while the poor financial health did not require big investment to get hold on the bank as the majority shareholder,” said Mohammad Imran, a researcher at JS and company.

He said Samba group did not pay premium for acquiring the major shares as witnessed in the case of Union Bank.

Analysts said that the situation was hot for investment in the banking sector as vast potential for growth of the sector was visible. However, the Arab investors had been showing their willingness to offload their holdings in the Pakistani banks.

“The Arab investors were selling their shares only when they get profit beyond their expectations,” said another analyst referring to Union Bank deal.

The banking sector in Pakistan has been making record profit for the last many years and this has attracted some top international banks to explore the opportunities for investment.

“The news of Rs6bn injection by the Saudi group stopped flying deposits from the CresBank. The depositors were desperately wanted to save their money after facing shocks in the case of Crescent Standard Investment Bank (CSIBL),” said the analyst.

The nine-month results of the CresBank showed that it was in dire need of support as the deposits were evaporating and advances were declining sharply. In fact, it was the only bank of which the net interest income was negative during the nine-month of the current year.