The Government of Punjab has backed the Bank of Punjab with a proposed equity injection of up to Rs30 billion, a move the bank’s President and Chief Executive Officer Zafar Masud has described as a vote of confidence in its strategy, workforce and growth plans.
The Board of Directors of the Bank of Punjab approved the proposal during its meeting held on August 7, 2026. Under the proposal, the Government of Punjab will subscribe to ordinary shares worth up to Rs30 billion through an issuance other than a rights issue. The proposed transaction is intended to strengthen the bank’s capital position and provide additional capacity to expand its business across several priority segments.
The proposed issuance remains subject to all applicable statutory, corporate, shareholder and regulatory approvals. The shares will be issued at Rs38.20 per ordinary share. However, if the prevailing market price of the Bank of Punjab’s ordinary shares is higher at the time of issuance, the issue price will be set at the prevailing market price plus a premium of 5%. As a result, Rs38.20 per share will serve as the floor price for the proposed issuance.
Zafar Masud said the capital injection would provide the bank with the resources required to scale priority-sector businesses that it has developed across small and medium-sized enterprises, agriculture, affordable housing and digital lending. He also said the additional capital would support the bank’s efforts to continue expanding its business in Pakistan and pursue opportunities beyond the country.
The proposed investment comes after several years of transformation at the Bank of Punjab. During this period, the bank has expanded its balance sheet, improved its financial performance and strengthened its position across business segments considered important to Pakistan’s economy.
According to the bank, it currently holds the number one position in Pakistan in small and medium-sized enterprise financing, agriculture financing and affordable housing finance. It also ranks first in women’s leadership, credit card issuance and digital lending. At the same time, the bank has continued to strengthen its presence in export-oriented commercial and corporate banking.
The expansion of these businesses has increased the capital requirements of the bank. The Bank of Punjab said its capital base has historically remained relatively thin compared with the size of its operations and its potential for further growth. The proposed equity injection is therefore expected to provide additional capital headroom as the bank expands its core businesses.
The new capital is expected to support continued growth in priority sectors while allowing the bank to expand its low-cost deposit base without facing the same level of capital constraints. The stronger capital position is also expected to provide greater financial resilience and support prudent balance-sheet management as the bank increases the scale of its operations.
The proposed capital raise follows a period of strong underlying performance. During 2025, the Bank of Punjab recorded approximately 29% growth in revenue, while its earnings increased by more than 40% year-on-year. The bank also experienced significant appreciation in its share price during the period.
The equity injection is also expected to support the next phase of the bank’s expansion, including its international venture, which was recently approved by the State Bank of Pakistan. The planned capital strengthening could therefore provide the financial capacity required as the bank moves forward with its broader domestic and international growth strategy.
The proposed Rs30 billion equity injection will be implemented in phases, with the overall process targeted for completion by June 30, 2027. The completion of the transaction will remain dependent on the required regulatory, shareholder, corporate and statutory approvals. The Bank of Punjab is one of Pakistan’s leading commercial banks and is majority-owned by the Government of Punjab. The bank is listed on the Pakistan Stock Exchange and serves customers across Pakistan through its branch and digital banking network.
Its business operations include established franchises in small and medium-sized enterprise financing, agriculture finance, affordable housing and digital lending. The proposed government-backed capital injection is expected to give the bank additional capacity to build on these businesses while supporting its financial strength and longer-term expansion plans.
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