Apna Microfinance Bank Limited (APNA), a microfinance services provider, has entered into a Memorandum of Understanding (MoU) with FINCA Microfinance Bank Limited (FINCA), as the two MFBs are considering combining their operations to create “a more efficient microfinance bank”.

The development was shared by APNA in a notice to the Pakistan Stock Exchange (PSX) on Friday.

“The resulting combined entity is expected to generate significant benefits for all stakeholders through economies of scale,” said the listed entity.

“The increased market share and cost competitiveness will strengthen the Bank's financial position to better serve the low-income segments across Pakistan by providing flexible micro-financing and saving schemes,” read the notice.

The company shared that the State Bank of Pakistan (SBP) has granted in-principle conditional approval to APNA for commencing reciprocal due diligence to further explore the transaction contemplated in the MoU with FINCA.

The Board of Directors of APNA had already, in its meeting held on 15th December 2022, accorded its in-principal approval to conduct a reciprocal due diligence for the Potential Transaction.