Home Business Summit Bank posts Banking Sector’s Highest-ever Loss of PKR 10.8 billion

Business

Summit Bank posts Banking Sector’s Highest-ever Loss of PKR 10.8 billion

September 21, 2020

598

Summit Bank announced PKR 10.9 Billion Loss in 2018

Summit Bank Pakistan announced its 2018 financial result where it posted Pakistan Banking Sector’s Highest ever loss before Tax of PKR 10.8 billion.

Bank’s operations remained supressed as SMBL posted Interest Income of PKR 8.45bn as compared to PKR 10.66 billion in 2017.

Pertinent to mention is the massive amount of provisioning SMBL booked during the period. It is suspected that SMBL has been involved in inter group lending of Zardari Group and Omni group along with Sindh Bank.

SMBL Booked PKR 8.99 billion of provisioning against Non-Performing Loans. While Full Report is still unavailable, it is safely believed that such massive level of provisioning must have decreased the Net Equity of the Bank to mere PKR 2.2 Billion. Commercial Banks are mandated to maintain minimum equity of PKR 10 billion.

Summit Bank remained stuck in fake bank accounts case where suspicious intra-bank transactions from the Summit Bank were suspected to be of Zardari Group and Omni Group. Both Zardari Group and Omni Group are under investigation for Money Laundering Charges.

Summit Bank Ltd is primarily owned by Suroor Investments Ltd(66.6%) and Rupali Bank Bangladesh (1.24%). Based on the developments, SMBL’s sponsors are looking for potential buyers to acquire the Bank. However, keeping in view infected book of the bank, Buyers seem to be reluctant to buy the same at higher valuations.

Dubai-based businessman and the sitting chairman of the Summit Bank Nasser Abdullah Hussain Lootha has previously expressed his desire to acquire a controlling stake in the bank by injecting to fresh equity in the bank and take up to 51% ownership in the bank. However, no update is available on the same till filing of this report.