ABHI Bank has announced plans to pursue an Initial Public Offering (IPO) as part of its long-term strategy to strengthen its capital base and expand its digital banking operations in Pakistan. The proposed listing on the Pakistan Stock Exchange aims to raise approximately Rs2 billion to Rs3 billion, with the additional capital expected to support technology investment, expand lending capacity and accelerate the bank’s digital financial services. The announcement reflects the institution’s ambition to position itself as one of Pakistan’s leading digital-first banks operating under the State Bank of Pakistan’s Branchless Banking licence.
The planned IPO follows the bank’s transformation over the past eighteen months after the acquisition of a financially distressed institution. According to ABHI Bank, the turnaround was achieved through a secured lending model combined with a digital-first operating strategy that restored profitability and established a stronger financial foundation. The bank says this performance has created the confidence needed to move towards public listing while supporting long-term growth objectives.
The institution believes that capital remains one of the most important pillars of digital banking. While technology enables modern financial services, sustainable expansion requires sufficient capital to strengthen customer confidence, meet regulatory requirements and finance continuous investment in technology infrastructure. According to the bank, a stronger capital position will also improve resilience against changing economic conditions while supporting responsible lending and future innovation.
Since the acquisition, ABHI Bank’s shareholders have contributed significant Tier 1 capital to support the institution’s recovery and growth strategy. In addition to shareholder investment, the bank reports that it has generated approximately Rs2.5 billion in capital internally through profitability during the past eighteen months. The combination of fresh capital injections and internally generated earnings has strengthened the bank’s balance sheet and provided the platform for pursuing a public listing.
The bank stated that proceeds from the proposed IPO will primarily be used to strengthen its balance sheet, increase lending capacity and accelerate its digital banking roadmap. Planned investments include expanding its Banking as a Service (BaaS) platform, enhancing digital banking infrastructure and growing its secured lending operations through an omnichannel network comprising 114 customer touchpoints across Pakistan. According to the bank, every rupee raised through the offering will be directed toward building a stronger, more scalable and technology-enabled banking institution.
Looking beyond the IPO, ABHI Bank also outlined a broader capital management strategy designed to support future expansion. The bank intends to diversify its funding sources by introducing Additional Tier 1 (AT1) and Tier 2 capital instruments while also making greater use of credit enhancement mechanisms. These include first-loss guarantees, pari passu portfolio guarantees, partial credit guarantees, risk participation arrangements and blended finance structures. According to the bank, these instruments will improve capital efficiency and support the prudent expansion of unsecured lending while maintaining disciplined risk management practices.
The bank also highlighted its focus on financial resilience through prudent provisioning under the International Financial Reporting Standard (IFRS) 9 framework. Building expected credit loss reserves is intended to strengthen the institution’s ability to absorb potential economic shocks while maintaining long-term financial stability and regulatory compliance.
ABHI Bank believes Pakistan’s banking sector is entering a new phase in which digital-first financial institutions will play a greater role in expanding financial inclusion and improving access to technology-enabled financial services. The bank argues that growing demand for digital banking creates opportunities to deliver faster, more accessible and customer-focused financial products while supporting the country’s broader digital economy.
The proposed IPO is also expected to demonstrate the role Pakistan’s capital markets can play in supporting fintech innovation and digital banking infrastructure. According to Kabeer Naqvi, Entrepreneur in Residence at ABHI Group and former President and Chief Executive Officer of U Microfinance Bank, the public listing represents more than a capital-raising exercise. He described it as part of a broader strategy to build the financial strength required for the next stage of digital banking development in Pakistan while creating long-term value for customers, shareholders and the country’s evolving financial services ecosystem.
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