United Bank Limited (UBL) has officially issued new shares to the shareholders of the recently merged Silk Bank Limited (SBL). This step comes after the completion of the sanctioned amalgamation, following the approval from the State Bank of Pakistan (SBP). The merger, which became effective from March 11, 2025, marks an important milestone for UBL as it strengthens its position in the banking sector.
The merger between UBL and Silk Bank was approved under Section 48 of the Banking Companies Ordinance, 1962, by the State Bank of Pakistan. This regulatory green light allowed UBL to proceed with the transition and integrate the assets and operations of Silk Bank into its larger framework. The transition has been a significant development, as it reflects UBL’s continued efforts to enhance its market share and operational efficiency through strategic mergers and acquisitions.
In the wake of the merger, UBL has credited the new shares into the respective Central Depository Company (CDC) accounts of former Silk Bank shareholders. This action ensures that the shareholders of the now-defunct Silk Bank receive their fair share of UBL stock, further aligning the interests of both parties and ensuring a smooth transition as UBL absorbs Silk Bank’s customer base, assets, and operations.
The merger process has been closely monitored by the SBP, which played an instrumental role in overseeing the transaction. By sanctioning the amalgamation, the SBP ensured that the merger adhered to the regulatory standards of Pakistan’s banking sector, helping to maintain financial stability within the industry. This approval also allows UBL to seamlessly absorb Silk Bank’s portfolio, including its customers and assets, which can help UBL expand its reach across different segments of the banking market.
For UBL, the merger with Silk Bank offers significant growth opportunities. Silk Bank, which has a diverse customer base and a network of branches, provides UBL with a greater presence in areas where it was previously underrepresented. The inclusion of Silk Bank’s assets into UBL’s operations is expected to enhance UBL’s capacity to offer a wider range of services to its customers, from traditional banking products to innovative financial solutions.
In addition, UBL’s merger with Silk Bank can potentially lead to cost-saving synergies and improved operational efficiencies as both banks integrate their technologies, banking infrastructure, and human resources. With the technological advancements in digital banking becoming increasingly important, UBL is also likely to benefit from the enhanced capabilities Silk Bank has developed in offering digital financial solutions, adding to UBL’s tech-driven offerings in the market.
This merger is part of UBL’s broader strategy to strengthen its position in the competitive landscape of Pakistan’s banking sector. By consolidating its resources and expanding its customer base, UBL aims to deliver better financial services, improve operational efficiencies, and provide enhanced value to its shareholders.
The issuance of shares marks the next phase of the integration process, providing Silk Bank’s former shareholders with a stake in UBL. As the banking landscape in Pakistan continues to evolve, this merger is seen as an important step in consolidating the country’s banking market, with UBL playing a leading role in shaping its future.
The merger of UBL and Silk Bank signals a broader trend in the banking industry, where consolidation is being viewed as a key strategy for sustainable growth. Moving forward, both banks will work toward a smooth integration, ensuring minimal disruption to their customers and stakeholders.