Bank Alfalah Gets Approval For Rs20bn Capital Raise

Bank Alfalah Limited has secured final regulatory approval from the State Bank of Pakistan (SBP) to raise Rs20 billion through the issuance of Tier 2 capital instruments, according to a disclosure submitted to the Pakistan Stock Exchange (PSX).

The bank stated that the proposed capital raising exercise will be undertaken through the issuance of redeemable capital pursuant to Section 66 of the Companies Act, 2017, and in compliance with the Basel III capital adequacy framework prescribed by the State Bank of Pakistan.

Under the approved structure, the bank intends to issue Term Finance Certificates (TFCs) with an aggregate value of Rs20 billion. The proceeds from the issuance are expected to strengthen the bank’s regulatory capital base and support compliance with prudential capital requirements applicable to banking institutions.

According to the notification, the TFCs will initially be offered through a private placement arrangement. The bank has further indicated that the debt instruments may subsequently be listed in accordance with the applicable Debt Securities Listing Regulations, subject to the fulfilment of relevant regulatory and procedural requirements.

The issuance forms part of the bank’s capital management strategy and is intended to qualify as Tier 2 capital under the regulatory framework governing capital adequacy and risk management within Pakistan’s banking sector.

Bank Alfalah further clarified that despite receiving final regulatory approval from the central bank, completion of the transaction remains contingent upon the execution of definitive transaction documentation and satisfaction of all other applicable conditions precedent required under the relevant legal and regulatory framework.

The disclosure underscores the bank’s continued efforts to strengthen its capital position while maintaining compliance with evolving regulatory standards and international banking requirements.