Pakistan's largest bank, MCB Bank, will pay around $90 million to acquire the local operations of the Royal Bank of Scotland, a source with direct knowledge of the deal said on Monday. The Pakistan sale is part of moves by part-nationalised RBS to sell assets globally as it tries to exit up to 36 countries and focus on its mainly UK core businesses.
Last week, Australia and New Zealand Banking Group Ltd agreed to buy some Asian units of RBS for about $550 million. MCB Bank, the country's largest bank with a market value of $1.4 billion, said earlier on Monday its board had approved the proposed acquisition of RBS Pakistan, subject to regulatory approvals and signing of the share purchase agreement.
"We will pay around 7.5 billion rupees ($90.4 million) for RBS Pakistan," said the source, who declined to be identified as the deal has not yet been signed. "The share purchase agreement is likely to be signed in a day or two, maybe even tomorrow, in Dubai," he said.
The price would be 0.76 times RBS Pakistan's book value of 9.888 billion rupees, as of March 31. "In terms of pricing, MCB seems to have struck a great deal and the bank may even book a gain on amalgamation of RBS into MCB," said Asif Qureshi, director at brokers Invisor Securities.
"Valuation may have been the overriding consideration for MCB, as there appears very limited scope for creating business synergies between the two banks," he said. RBS Pakistan was not immediately available for comment. ANZ is buying RBS's retail, wealth and commercial businesses in Taiwan, Singapore, Indonesia and Hong Kong. ANZ would also buy RBS's institutional businesses in Taiwan, Philippines and Vietnam. Standard Chartered is in talks to buy RBS assets in China and India.