Bank Alfalah Limited has obtained key regulatory approvals to move forward with the proposed sale of its Afghanistan operations to Ghazanfar Bank, according to a disclosure filed with the Pakistan Stock Exchange. The approvals mark a major step in advancing the long-anticipated divestment of the bank’s Afghanistan business and allow the transaction to progress to the due diligence stage.
In its filing, Bank Alfalah stated that the State Bank of Pakistan has granted in-principle approval for Ghazanfar Bank to initiate due diligence on Bank Alfalah’s Afghanistan operations. In parallel, the Central Bank of Afghanistan has also authorized the commencement of the process, clearing a significant regulatory hurdle for the proposed cross-border transaction.
The development follows the public disclosure of a non-binding offer made by Ghazanfar Bank on December 4, 2025, to acquire Bank Alfalah’s Afghanistan business. With regulatory permissions now in place, Ghazanfar Bank is set to begin a detailed review of the operations, financials, and regulatory standing of the business as part of the due diligence process.
Bank Alfalah clarified that the proposed transaction remains subject to several conditions, including the successful completion of due diligence, execution of definitive agreements, and fulfillment of all applicable legal and regulatory requirements in both Pakistan and Afghanistan. Final approvals from relevant authorities in both jurisdictions will be required before the deal can be completed.
Once finalized, the transaction is expected to significantly reshape Bank Alfalah’s regional footprint and mark its full exit from the Afghan banking market. The move would represent a notable shift in the structure of Afghanistan’s banking sector, reflecting changing regional dynamics and strategic priorities of international banking groups operating in the country.
Last month, Bank Alfalah confirmed that it had accepted a non-binding offer from Afghanistan-based Ghazanfar Bank for the acquisition of its Afghanistan operations. Ghazanfar Bank is a licensed commercial bank established in 2009 by the Ghazanfar Group, a prominent Afghan conglomerate with interests spanning petroleum, gas, and various industrial sectors. The bank operates 15 branches across major Afghan cities and offers both conventional and Islamic banking services.
The proposed acquisition would conclude Bank Alfalah’s long-standing presence in Afghanistan, which dates back to 2005. The bank currently operates branches in Kabul and Herat and provides both conventional and Islamic banking services. Over the years, it has played a significant role in facilitating international transactions, including serving as a correspondent partner for Citibank NA for processing US Department of Defense payments in Afghanistan. It is also the only financial institution in the country with a primary relationship with VISA.
Bank Alfalah’s correspondent banking network includes major global institutions such as Citibank in the United States, Commerzbank in Germany, Habib American Bank in the United States, and United National Bank in the United Kingdom. This network has supported cross-border trade, remittances, and financial connectivity for Afghan businesses and institutions.
The bank has been seeking to exit its Afghanistan operations for several years. A previous divestment attempt in 2019 did not materialize after Da Afghanistan Bank rejected an acquisition proposal submitted by Azizi Bank, despite an in-principle understanding between the two institutions. Following that setback, Bank Alfalah indicated that it would explore alternative options, including engaging with other potential buyers or maintaining operations for a limited period.
The current progress with Ghazanfar Bank signals renewed momentum toward completing the exit, subject to regulatory scrutiny and successful negotiations. The transaction underscores the complexities involved in cross-border banking deals and highlights the importance of regulatory coordination between Pakistan and Afghanistan in facilitating such strategic moves.
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