MCB Islamic banking business reports decline in earnings

The Islamic banking business of Muslim Commercial Bank (MCB) witnessed modest performance in its recently announced financial results for the half year ended June 30, 2011.

The profit before taxation of MCB Islamic banking business remained under pressure during the first six months of the financial year as it declined to Rs 114.75 million from Rs 126.82 million recorded in the same period last year.

Immense growth in branch network of Islamic banking windows by conventional banks was witnessed in last three years. This was due to acceptance by local customers to fulfill their financial needs in Shariah compliant manner.

Merrill Lynch bullish on Pakistan

“Sell Indonesia, buy Pakistan”, the international financial services firm, Merrill Lynch (ML) recommends Pakistan, Sri Lanka, Vietnam and Mongolia as ‘new frontiers’ in their latest regional investment strategy report released on Thursday (Feb 15).

Among the four countries, Spencer White, the strategist who prepared the report says: “Pakistan remains one of our highest conviction overweight recommendations”. He reasons that the on-going economic reforms remains a core priority and that it should sustain high economic growth and lead to further financial stability, something which ML “feels the market has under-appreciated”. Best exposure to Pakistan has been recommended on rural expansion focus companies, which ML identifies as Adamjee Insurance; MCB; United Bank and Fauji Fertiliser Bin Qasim.

Best Cure for Hiccups?

“No matter how strong a bull may be, there is a time when it gets tired”, I said in my article “How Much Bull Can you Take”. My sentence reflected the market situation last week. (Behold, for my next trick I shall make Chirac disappear!) I mentioned that the bullish trend would continue and it is going to be a week of correction. It wasn’t exactly a correction of the magnitude I’m still expecting but it was definitely a hiccup that required more than a glass of water to abate. Though on the day market was a bit rough and the index showed fluctuation of about 175 points, Tuesday ended with a positive note. Correction, nevertheless, it was, in principle.

How Much Bull Can You Take?

Last week was another good one for the stock markets; KSE-100 index gained about 500 points. The bulls ran rampant. The trend which started mid-January continued. The index gained more than 1, 000 points overall straight away, without any correction. The index, which started rising mid-January, is now above 11, 500 points. TNA, people: Total Non-stop Action.

Recovery After Crash

After the index breaking the 9,900 level last month, started to rise gradually. When such a crash comes there is a level where short sellers start profit taking, so there is a slight change in the trend. Secondly the prices came on the lower level that they attracted the individuals to buy shares. As the future contracts for December were over and new month started so a fresh buying in Jan contracts was obvious. Another factor in my opinion which played the most vital role in supporting the index was the news that Prime Minister has postponed the decision to levy capital gain tax for next year. This made the institutions to come to the market for fresh purchasing. We saw that the index gained about 250 points in two days.

Foreigners hold 20pc of free-float on KSE

Foreign investment in the country’s capital market is generally dismissed as of little consequence and an ex-chairman of the Karachi Stock Exchange commented a little while ago that the market would be better off without it.

Such disillusionment stems from the mood swings of a foreign portfolio manager: “The outflow of funds is as quick as its inflow,” says a market guru. But the influence of the off-shore equity investment in the local bourses is growing.Admitting that the foreign funds hold just about 4 per cent of total market capitalization and the share of overseas funds in average daily volume is just about 3.5 per cent, analysts at the JS Capital Market have calculated that approximately 17 per cent of the share represents foreign investment in the float adjusted capitalization.

CFS Eligible Scrips

1. ACBL
2. BAFL
3. BOP
4. DGKC
5. DSFL
6. ENGRO
7. FABL
8. FCCL
9. FFBL
10. FFC
11. HUBC
12. KAPCO
13. KESC
14. LUCK
15. MCB
16. MLCF
17. NBP
18. NML
19. OGDC
20. PIAA
21. PICB
22. PICIC
23. POL
24. PPL
25. PPTA
26. PSO
27. PTC
28. SNGP
29. SSGC
30. TELE
31. AICL
32. CTTL
33. BOSI
34. NCL
35. ANL
36. PCCL
37. JOVC
38. DCL
39. TRG
40. WTL
41. SNBL
42. KOHC
43. PRCBL
44. STPL
45. SPCB
46. JSIB
47. NETRSOL
48. CHBL
49. Attock Refinery
50. Attock cement
51. AHSL
52. INDU
53. ICI
54. PRL
55. Cherat cement
56. Packages
57. PSMC
58. ABL
59. FNEL
60. Pak Electron
61. Bank Al habib
62. Millat Tractor
63. Pakistan Cable
64. KSE
65. BOC
66. THALL
67. SECURITY PAPER
68. APL
69. Ferzoz sons

Foreigners hover near fast-growth local banks

Foreign banks are beating a path to Pakistan’s financial sector, attracted by reforms that have laid the platform for rapid growth and rising incomes.

Asia-focused Standard Chartered earlier this month completed the $487 million purchase of a 95.37 per cent stake in Union Bank Ltd – the biggest buy yet by a foreign bank in Pakistan.

Singapore’s Temasek Holdings, Dutch ABN Amro and HSBC are among other foreigners eyeing possibilities in Pakistan, according to bankers here.

Khawaja Iqbal Hassan, President and Chief Executive of NIB Bank (NDLC-IFIC Bank) – majority owned by Temasek – confirmed his intention to acquire a bank, but did not give specific details.

Governmentt plans foreign share listings

Pakistan is considering four more firms, including three banks, for foreign listings through the issuance of global depository receipts in the current fiscal year ending June 30 2007, a senior government official said on Thursday.

The government has already announced plans to list the Oil and Gas Development Co. Ltd. (OGDCL) on the London Stock Exchange by December.

Last week private MCB Bank Ltd, the country’s second largest listed bank, also announced it was planning a GDR sale in London worth up to $150 million. The pricing of the issue is expected on October 9.

MCB Bank plans $150m GDR

MCB Bank Ltd, Pakistan’s second-largest listed bank, said on Thursday it was preparing a global depository receipt (GDR) sale in London worth up to $150 million.

MCB, which ranks behind National Bank of Pakistan on the Karachi Stock Exchange (KSE) with a market capitalisation of about $1.9 billion, will start pre-marketing the offer later this month.

That timetable could beat to the market a potentially larger London issue by Oil and Gas Development Company Ltd (OGDCL), which plans to list between 10 and 15 per cent of the $9 billion oil firm as a GDR by the end of the year.