Shareholders of NIB bank want to merge with MCB Bank to become the one largest commercial bank. MCB is in talk with Fullerton financial holdings, which have the largest shares in NIB of about 88.4% through its wholly owned subsidiary Bugis investment Mauritius. Fullerton is being invested by Singapore government who hold 100% shares.
An analysis has shown that NIB bank will lose its existence if the two parties will agree on a price and receives a regulatory approval. This will give the boost to the market capitalization of NIB bank at the end of Tuesday to Rs 24.5 billion.
MCB is the countries third most profitable bank (25.5billion) and fourth largest net assets of Rs 137.8 billion. But this not clear that what makes the MCB bank to show interest in overtaking NIB bank which just have 17.1 billion assets.
No reason except the tax asset of Rs 9.5 billion on the NIB bank book has gained attention of MCB bank; said by ALFALAH securities deputy head of research Fahad Irfan.
NIB has given employment to 2,678 people and has 170 branches across the country. They have made profit of Rs 2.6 billion, as they were in loss of 507.7 million last year.