The Securities and Exchange Commission of Pakistan (SECP) has issued the Certificate of Incorporation to Meezan Exchange Company (Private) Limited, a fully-owned subsidiary of Meezan Bank Limited (MEBL).
The development was announced by MEBL, the country’s largest Islamic bank, in a notice to the Pakistan Stock Exchange (PSX) on Wednesday.
“We are now pleased to inform you that subsequent to the issuance of the NOC from the State Bank of Pakistan for establishment of the Exchange Company, the Securities and Exchange Commission of Pakistan (SECP) has issued the Certificate of Incorporation to Meezan Exchange Company (Pvt.) Ltd., a fully-owned subsidiary of Meezan Bank Ltd,” read the notice.
MEBL said under the next step, the application will now be submitted to SBP for issuance of a license to commence operations, as per the SBP Exchange Companies Manual.
Back in September, the Board of Directors (BoD) of Meezan Bank Limited announced that it would establish an Exchange Company (EC) as a wholly-owned subsidiary.
A number of commercial banks have made similar announcements, which come after the SBP, in its bid to strengthen controls amid the massive fall in the rupee’s value in the open market, decided to introduce ‘structural reforms’ in the EC sector.
“As part of these reforms, leading banks actively engaged in foreign exchange business will establish wholly-owned Exchange Companies (EC) to cater to the legitimate foreign exchange needs of the general public,” said the SBP in a statement.
In addition, the SBP also raised the minimum capital requirement for EC from Rs200 million to Rs500 million, raising the barrier to entry for the private sector.
Meezan Bank posted earnings of Rs25.99 billion for the first three months of fiscal 2023-24, up nearly 124% from the profit-after-tax Rs11.62 billion in the same period of the preceding year.
Its earnings per share clocked in at Rs14.42 for the three-month period. The Board of Directors also announced an interim cash dividend for the quarter ended September 30, 2023 at Rs5 per share i.e. 50%. This is in addition to interim Dividend(s) already paid at Rs7 per share i.e. 70%.
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