Bank Alfalah has decided to repurchase up to 200 million ordinary shares with a face value of Rs. 10 each via the Pakistan Stock Exchange.
According to the stock filing, the board of directors decided on November 10 to purchase up to 200 million ordinary shares (equivalent to up to 11.25 percent of the bank’s current issued and paid-up share capital).
The purpose of the repurchase was stated as the bank cancelling shares, which will cost the bank up to Rs. 2 billion.
The shares will be purchased on an as-needed basis at the spot/current price acceptable to the bank at the time of purchase, in accordance with Regulations 8 (2) of the Regulations and subject to Section 88(8)-PSX.
The shares will be purchased between December 14, 2022, and June 2, 2023, or until the purchase is completed, whichever comes first. The bank’s distributable profits will be used to fund the buyback.
The board has recommended the purchase/buyback because it will benefit the bank’s breakup value, return on equity, and earnings per share. It will also allow members who want to liquidate their investments, either fully or partially, to do so.
To read our blog on “The new “security feature” from Bank Alfalah is a hassle,” click here