Pakistani branch operations of HSBC Bank Middle East have now merged with and into Meezan Bank, according to a notice issued by the Karachi Stock Exchange yesterday.
Subsequently, all customers of HSBC Pakistan will automatically become customers of Meezan Bank.
Earlier on, the State Bank of Pakistan (SBP) sanctioned the scheme of amalgamation of HSBC Pakistan with Meezan Bank following the fulfilment of all regulatory requirements.
An indirect, wholly owned subsidiary of HSBC Holdings, HSBC Pakistan consisted of 10 branches and had total assets of Rs48 billion at the end of 2013.
Meezan Bank has already stated that it intends to make the operations of HSBC Shariah-compliant, while ensuring that the existing customer base continues to receive uninterrupted banking services.
Meezan Bank has the experience of acquiring a foreign bank and converting its operations from conventional to Islamic.
The sale of HSBC Pakistan is part of a strategy by Europe’s biggest bank to exit from countries where it is unprofitable or lacks scale.
Like most foreign banks, the clientele of HSBC Pakistan consists mainly of multinational companies with headquarters in European countries.
Whether these multinational companies stick with their current bank after it merges into the country’s largest Islamic banking institution is yet to be seen.
