United Bank Limited (UBL) has received approval from its Board of Directors for the merger with Silkbank Limited (SBL), marking a significant step in the bank’s expansion strategy. The merger, which was approved during the 252nd board meeting held on December 2, 2024, will take place through a share swap arrangement, simplifying operations and enhancing stakeholder value. The agreement to amalgamate, along with the Scheme of Amalgamation and other relevant documents, have been approved, ensuring compliance with regulatory requirements and corporate governance standards.
The terms of the merger stipulate that UBL will issue one new ordinary share for every 325 shares of SBL. The share swap will result in the issuance of approximately 27.94 million ordinary shares by UBL. The face value of these shares is PKR 10 each. However, the merger remains subject to several conditions before it can be finalized. These include the execution of definitive agreements between UBL and SBL, obtaining all necessary corporate, regulatory, and third-party approvals, and receiving the approval of the Scheme of Amalgamation by the State Bank of Pakistan, as required under the Banking Companies Ordinance, 1962. Additionally, shareholder approval will be sought from both UBL and SBL.
Once the merger is completed, UBL is expected to benefit from increased market share and enhanced operational efficiency, thanks to the consolidation of resources and the leveraging of synergies between the two banks. This merger aligns with UBL’s broader strategic objectives of strengthening its position within Pakistan’s competitive banking sector.
The decision reflects UBL’s long-term commitment to optimizing its resources, streamlining operations, and expanding its reach within Pakistan’s financial landscape. The deal also positions UBL to capture greater market share and create more value for its stakeholders, making it a notable development in the country’s banking sector.
By merging with Silkbank, UBL aims to capitalize on Silkbank’s existing assets and customer base, while benefiting from economies of scale and improved financial efficiency. The strategic merger is seen as a key move to enhance UBL’s competitive advantage and extend its footprint in Pakistan’s banking industry, helping the institution cater to a broader demographic while navigating the complexities of the modern financial ecosystem.