Meezan Bank signs agreement to acquire HSBC Bank Oman
In May, Meezan received central bank approval to buy the local banking business of HSBC, as the European bank exits from countries where it is unprofitable or lacks scale. HSBC Bank Oman is 51 percent owned by HSBC.
In contrast, Pakistani lenders are expanding, buoyed by a government-wide push to develop the Islamic banking sector in the world’s second-most populous Muslim nation.
HSBC Bank Oman’s operations in Pakistan consist of only one branch. At the end of the first quarter of 2015, the bank had gross assets amounting to Rs4.1 billion. The acquisition is expected to materialise in the second half of 2015 subject to regulatory approvals.
HSBC Bank Oman currently operates in Oman, India and Pakistan. It decided in 2012 to sell off its India and Pakistan operations. It signed an agreement to sell its banking business in India to Doha Bank QSC in April last year.
The sale is part of a strategy by Europe’s biggest bank to exit from countries where it is unprofitable or lacks scale. HSBC’s Pakistan unit has 10 branches and had assets of about $455 million at the end of 2013.