Overview of the company

 Symbol:

NIB  

 Open Rate:

11.04  

Low Rate:

10.93  

 Current Rate:

10.93  

 Market Capitalization:

31081936940.68

NIB Bank Limited is the 7^th largest bank operating in Pakistan ( in terms of branching network) at the moment. The bank initially operated as NDLC-IFIC Bank Limited. In March 2003 NIB Bank Ltd was established as a public limited company. The bank inherited all its assets, liabilities and rights from NDLC (National Development Leasing Corporation) and IFIC. NIB Bank started its official operations in October 2003 with a paid up capital of Rs 1.2billion. Six months later, in April 2004 the Credit Agricole Indosuez also merged with NIB. Temasek Holdings (Singapore) holds of 70% shareholding in NIB Bank. The bank follows aggressive growth strategy and has been growing rapidly since the time it was incorporated. In June 2007, the bank acquired majority shareholding in PICIC and merged its subsidiary, the PICIC Commercial Bank into NIB Bank on 31^st December, 2007. The positive impact of this rapid growth on the bank’s distribution network and balance sheet could be easily identified. The bank had only 2 branches, Total asset worth Rs 9 billion, loan base of Rs 7 billion, and paid-up capital worth 1.2 billion in October 2003. Whereas in the year 2008, it operates through 240 branches all over the country and possesses total assets worth Rs 185 billion, loan base of Rs.43billion, paid-up capital of Rs 27.5 billion (2^nd highest paid up capital in Pakistani banking sector) and client base of over 100,000. The merger with PICIC Commercial Bank not only helped the company lower costs and enhance customer services, but also earned quite respectable Foreign Direct Investment for the country’s betterment. Moreover, the bank has also diversified its operations into asset management and insurance fields by acquiring the asset management arms "PICIC AMC" and working with an affiliate "PICIC Insurance".

NIB Bank’s Upgraded Credit Rating:

On July 2, 2008 NIB Bank announced that the Pakistan Credit Rating Agency (PACRA) further upgraded the bank’s credit rating to AA- (long-term) and A1+ (short-term). This credit rating indicates that expectation of credit risk is quite low and the bank’s capacity for timely management of its financial commitments is strong.

Historical Trend and Future Outlook:

NIB Bank has become a powerful franchise of the three merged financial entities over the years. No doubt about that. NIB Bank's vision is “to rank amongst the top 5 banks in the country “.The bank is more likely to perform outstandingly in the coming days, and provide a wide range of high quality financial services through its extensive network in 60 major cities of Pakistan. Shareholders can expect attractive dividend stream with least doubts. But the commercial banking sector listed on Karachi Stock Exchange (KSE) might not be able to churn out a cumulative return of 66 % like last year as the stock exchange has just suffered a historical crash in the first half of 2008. Although the main reason behind the banking sector’s outstanding returns in 2007 was substantial earnings growth momentum ( 14% growth in just nine months, i.e. from January to September of 2007). But mergers and acquisitions (including PICIC’s acquisition by NIB Bank) also helped the banking sector to attract investors. Moreover, NIB Bank outshined all the commercial banks listed on the KSE 100-index by earning the highest returns of 259 percent in the same period. But as I said, stock exchange is no longer a bed of roses for any bank during the 2^nd half of the current fiscal year. Pakistan’s economy is going through the roughest phase in history. Stock Exchange has notoriously become a haunting place for the investors. Had the things been different on the economic front of my country, NIB Bank would have been my most favorite stock for long-term investment.

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