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BUSINESS Saturday, 27 April, 2013
KARACHI iSMAil DilAWAR
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ISENChANTED minority shareholders of the loss-making NIB Bank, which has been posting losses for three consecutive years without declaring a single rupee as dividend for the equity stakeholders, have had enough it appears. NIB Bank is owned by the Singaporean investment giant Temasek holdings that possesses the bank’s controlling stakes (over 70 percent) since June 2005. “For all clinical reasons NIB Bank can be termed ‘a dead horse’,” claimed a letter written and sent by a 37-member group of minority shareholders to the central bank on April 10. An NIB Bank spokesman, however, said the bank, after posting losses for years, had hit a “break-even” during the just-concluded first quarter of 2013 that saw the bank posting a profit before tax (PBT) of Rs 145 million. Not sure about the bank management’s ability to transfer profits to shareholders, the spokesman said the current “turnaround” in the bank’s performance would certainly relax the latter. In the letter, the minority shareholders have called upon Temasek Group to order an internal enquiry, the central bank and the Securities and Exchange Commission of Pakistan (SECP) to appoint forensic auditors and the federal finance ministry to intervene to save the bank’s minority shareholders, “who are Pakistanis”. The stakeholders, who claim to hold the bank’s shares, worth Rs 2 billion at least, are concerned over what they claimed was a possible decrease by its management
Pakistan has never defaulted in its int’l obligations, says finance adviser ISLAMABAD Online Adviser to Prime Minister on Finance Dr Shahid Amjad Chaudhry said Pakistan has never defaulted on an international obligation since 1947 and will never default in the future. During a meeting with Ambassador of Japan to Pakistan Hiroshi Oe, who called on him on Friday, he said Pakistan’s economy is strong enough to meet its international obligations. He said Japan is a very special country for Pakistan and its contribution to Pakistan’s development is fully acknowledged. Pakistan and Japan should remain engaged continuously to further consolidate economic ties, the adviser said. Dr Shahid praised Japan for extending funds for projects like Karachi Circular Railways, Thar coal Project and Lahore water project, declaring them as pearls of Pakistan-Japan friendship. He emphasised that exchange of academia between Pakistan and Japan should also be promoted to further strengthen relations between the two countries. Scholars in Japan working on Pakistan should also be extended financial help by Japan the adviser added. The ambassador said Japan is quite optimistic over the economic situation in Pakistan. He said despite financial constraints in Japan, the government of Japan will continue to assist and invest in Pakistan, adding that contribution in infrastructure development in Pakistan is major priority of Japan. To overcome the energy crisis in Pakistan, Japan will assist Pakistan in short, medium and long term projects, he said. Japan is taking a keen interest in overcoming the energy crisis in Pakistan, the ambassador added. He said Japan wants to eradicate polio from Pakistan and is already involved in the polio eradication campaign.
For all clinical reasons, loss-making NIB Bank is a dead horse in the banks’ capital. “Some of the banks face a daunting outlook and amongst them is NIB Bank,” read the letter addressed to the State Bank of Pakistan (SBP) governor. Alleging the bank for having “some hidden and apparent weaknesses,” the shareholders told the SBP governor that the bank had incurred accumulated losses of Rs 56.156 billion during three consecutive years from 2010 to 2012. Of the total, they said, Rs 44 billion were lost in 2012, Rs 2.044 billion in 2011 and a whopping Rs 10.112 billion in 2010. 2012’s losses, Rs 44 billion, constituted about 42 percent of the bank’s paid up capital which, according to Karachi Stocks Exchange data, amounted to Rs 103.028 billion up to April 22, 2013. Only the last quarter of 2012, the shareholders said, saw the bank losing over Rs 1.31 billion, 34 percent of the first three quarters. Questioning the ability of the bank management to wipe out these accumulated losses, the stakeholders termed the bank’s “huge” administrative expense as the biggest contributing factor for these losses. They, in the letter, told the central bank that during 2012, NIB Bank’s administrative expenses were estimated at Rs 5.173 billion compared to 2011’s Rs 4.72 billion. “The bank’s expenditures are extravagant to the extent that it has booked seven floors at the PNSC Building and is spending millions to renovate the same,” a shareholder said while talking to Pakistan Today, requesting anonymity. The bank was shifting its main office to the building, he said, adding the management had replaced the old and seasoned staff with those drawing large salaries without any productive results.
Despite its claim to be a commercial bank with the largest paid up capital, the bank’s current share price at the KSE ranges between Rs 1.50 and Rs 2.80... Probability of any recovery can be termed ‘hoping against hope’ “The bank has not paid any dividend since the Temasek took over six years back,” the shareholders claimed. Recalling its pre-Temasek record, they said, the bank used to pay dividend, bonus and huge returns to shareholders every year. The NIB’s share value was around Rs 80 when it was PICIC Commercial Bank. Despite its claim to be a commercial bank with the largest paid up capital, the bank’s current share price at the KSE
ranges between Rs 1.50 and Rs 2.80. According to KSE quotations, on April 22 the bank’s share was priced at Rs 2.17, with its trading turnover standing at 287.7 million. “Probability of any recovery can be termed ‘hoping against hope’,” reads the shareholders’ letter to SBP. Even the injection of millions of dollars by its majority stakeholder, Temasek holdings, could not help the bank improve, they added. They went on to accuse the bank of depriving them of their “right to speak” by setting up the bank’s head office in Islamabad. “The minority shareholders cannot afford to travel to Islamabad to raise their voice,” they said. They also expressed concern over the bank’s plan to reduce its capital to Rs 2.50 per share. “Temasek, an international group, can afford this luxury but the minority shareholders cannot,” they warned and demanded of the Singaporean firm to compensate them in buying their shares before proceeding with its reduction of capital plan. The shareholders wondered as to why regulators, SBP and SECP, quietly witnessed the “downfall” of NIB Bank and the equity of its shareholders. Talking to Pakistan Today, a shareholder said the State Bank had not yet responded to the shareholders’ letter. he said if the regulator failed to address their concern, they would do all they can to make their voice heard. When contacted a spokesman of NIB Bank, Ali habib, conceded to have received the shareholders’ letter saying it was true that the bank was running in losses since the last five years. “It is public knowledge because the bank is a listed company,” he said. But, Ali said, the bank’s performance during first quarter of 2013, JanuaryMarch, had seen a turnaround with the bank
SECP takes punitive measures against companies’ executives ISLAMABAD Online
Securities and Exchange Commission of Pakistan (SECP) on Friday initiated 122 show-cause proceedings against higher-ups of various companies for failing to comply with applicable provisions of laws. As part of its mandate to monitor listed and unlisted companies to safeguard investor interest, the enforcement department of the SECP started proceedings against chief executives, directors, and auditors of listed and unlisted companies. Enforcement actions for breaches of statutory requirements related to: issuance of auditors’ reports, takeover regulations, holding of annual general meetings, inter-corporate financing, issuance of capital, misstatement of facts, employees’ provident funds, consolidation of financial statements, circulation of financial statements, disclosure of directors’ interests, and cost audit rules. Penal proceedings against directors of listed company concluded on account of material misstatements whereby the directors siphoned off tax refunds disguising them as proceeds from the false sale of its subsidiary. In addition to the proceedings noted above, the department has concluded 79 proceedings against directors and auditors of companies either by penalising or by warning the
ISLAMABAD APP
The World Intellectual Property Day (IP) 2013 was observed on Friday across the globe including Pakistan with its theme ‘Creativity: The Next Generation’. The event was established by World Organisation Property Intellectual (WIPO) in 2000 to “raise awareness of how patents, copyright, trademarks and designs impact daily life” and “to celebrate creativity, and the contribution made by creators and innovators to the development of societies across the globe”.
identified defaulters. In addition, the department has also initiated inspections on affairs of four companies while an investigation has been initiated into the matters of a private limited company. The department, addressing grievances of investors, successfully resolved nineteen complaints. These complaints were mainly pertaining to non-issuance of shares, non-verification of transfer deeds, and nonpayment of dividends. Four companies have been directed to hold their overdue annual general meetings within a specified time. To facilitate companies in preparation of their consolidated financial statements, six companies have been granted exemption from requirements of consolidation of their annual financial statements. One company has been accorded approval to appoint its cost auditors under the Companies (Audit of Cost Accounts) Rules, 1998. In addition, three companies have been allowed to place their quarterly accounts on their respective websites, while one company has been allowed to change its websites address. One company has been allowed to extend a loan facility to its chief executive. Extension in time has been granted to a company for making public announcement of “offer to shareholders for sale of their shares,” in relation to its intended acquisition of another company.
WORLD INTELLECTUAL PROPERTY DAY 2013 OBSERVED The aims of this special day also include increasing understanding of how protecting intellectual property (IP) rights helps promote creativity and innovation, celebrating creativity and the contribution made by creators and innovators to the development of societies around the globe and to encourage respect for IP rights of others. WIPO works together with various
government agencies, non-government organisations, community groups and individuals and holds different events and activities to promote World Intellectual Property Day each year. United Kingdom (UK) Minister for Intellectual Property Lord Younger said in his message on the occasion: “I’m delighted to celebrate World Intellectual
posting a profit before tax of Rs 549 million compared to a loss before tax of Rs 98 million during the corresponding period of 2012. Terming the bank’s results as “one of the best” in market, the spokesman said the bank, under its new management, that had taken over the bank in January 2012, had started showing results. Ali conceded that the bank’s ability to benefit equity shareholders remained limited in recent years but that the current positive trend in the bank’s revenues would ultimately relax stakeholders. he, however, was uncertain whether or not his management would now declare the most-awaited dividends for its shareholders on the stocks market. “We are getting established so the shareholders, I am sure, would be relaxed,” said the spokesman. Responding to a question about the bank’s alleged extravagant expenditures, Ali said, the situation in fact was other way round. In 2012, he recalled, the bank’s revenues increased by 25 percent compared to its 10 expenditure. In 2013, he said the first quarter had seen revenues growing by 21 percent against the bank’s 2 percent expenses. Asked if booking seven floors of PNSC was an economical move by the bank, the spokesman replied in the affirmative. “We have moved to a cheaper premises from one of Pakistan’s most expensive places at I I Chundrigar Road,” he added. he assured the protesting shareholders that the bank’s new management, led by President Badar Kazmi, who has served Standard Chartered Bank for seven years as its CEO, would turn the bank’s business around. Running a countrywide network of 179 branches, NIB Bank claims to be one of the fastest growing banks in Pakistan having started operations in October 2003 with a paid up capital of Rs 1.2 billion.
ICCI a finalist in World Chambers Competition 2013
ISLAMABAD: Islamabad Chamber of
Commerce and Industry (ICCI) reached the finals of the World Chambers Competition 2013 by presenting its Best Youth Entrepreneurship Project to an international judging panel during a dedicated Congress session. The 2013 World Chambers Competition, which was held at Doha, Qatar, received entries from 65 chambers of commerce and industry from 42 countries and ICCI was among the 25 finalists, who presented their innovative projects at the forum. This World Chambers Congress plays a crucial role in gearing up chambers of commerce to satisfy and go beyond the needs of businesses and increases global unity between chambers and opens up new channels of dialogues. inP
Property Day today. World Intellectual Property Day is a good time to reflect on what we have achieved and also look forward at the challenges ahead.” Working closely with stakeholder organisations, the IP enforcement team is responsible to coordinate a national policy for the enforcement of Intellectual Property rights and provide the secretariat for the IP Crime Group. This year, an IP enforcement team member and long standing Intellectual Property Office staff member Miles Rees put great emphasis on the importance of the enforcement work that is carried out.
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Envoy urges enhanced bilateral trade between Pakistan, Sri Lanka CoLoMBo
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AKISTANI high Commissioner (hC) Maj Gen Qasim Qureshi, on Friday, emphasised on exploring ways and means to further enhance business connectivity and volume of bilateral trade between Sri Lanka and Pakistan. During his visit to Galle district in southern Sri Lanka, Qureshi attended a meeting with officials of the Galle District Chamber of Commerce & Industry. The meeting re-
viewed the prevailing business environment between the two friendly countries. Qureshi noted that the two countries had put in place an overarching economic framework to facilitate businessmen of both countries to set-up and strengthen commercial and investment ventures. The hallmark of this framework is the Free Trade Agreement (FTA),
KCCI urges Germany to invest in Pakistan KARACHI: Karachi Chamber of Commerce & Industry President Muhammad haroon Agar urged the German Ambassador to Pakistan Dr Cyrill Nunn to invite new German investment in Pakistan as the country is the most promising land in the region for investment and many German corporations are operating successfully and expanding their businesses across Pakistan and beyond. Exchanging views with the ambassador during his visit to KCCI, Agar said within EU, Germany has become Pakistan’s biggest trading partner. Germany ranks as the 9th largest trading partner ahead of UK even, he stated. There are many opportunities and there is a lot of potential between the two friendly countries which can be further developed, he added. Pakistan’s exports to Germany in 2012 were worth $ 1,151 million while imports were $ 1,174 million. nni
which has been operational since 2005, he added. he further stated that Pakistan and Sri Lanka also have a Bilateral Investment Treaty (BIT) and an MoU on Customs co-operation. Qureshi highlighted that Pakistan offered extremely attractive opportunities to the Sri Lankan traders and consumers to benefit from abundant raw materials, avail-
able at competitive prices and low freight costs. he explained that Pakistan produces various varieties of rice, vegetables and fruits, which if imported from Pakistan to Sri Lanka, can considerably reduce the inflation on food items, at the same time providing a wide choice of consumables. Later in the day, the high Commissioner also met Southern Province Governor Kumari Balasuriya, Southern Naval Commander Rear Admiral Piyal harischandra De Dilva and Jamiat Ulema Islam (JUI) Galle District chief Mustafa Mohammad Awn.
Mahmood appointed acting SECP chief KARACHI STAFF RePORT
The federal government appointed Tahir Mahmood as acting chairman of Securities and Exchange Commission of Pakistan (SECP), said a statement issued by the apex regulator on Friday. The Finance Division issued a notification in this regard. Mahmood, currently the commissioner of SECP’s law division, represents the category of commissioners who are being appointed from within the SECP under section 5 of SECP Act, 1997. he is a regular employee of the SECP and joined the service through Federal Public Service Commission (FPSC) as a Grade-18 officer in the former Corporate Law Authority (CLA) in 1989. he is a chartered accountant and carries a rich experience of over 25 years with CLA and the SECP.
he is fellow member of ICMAP and ICSP and also has a degree in law. he possesses extensive experience in company law administration, takeover laws, corporate restructuring, mergers, corporate finance and judicial order writing. he has in his credit about four hundred judicial orders passed by him in his capacity as adjudicating officer and member of appellate bench while working as executive director/commissioner at SECP. A significant number of such orders are published in CLD and referred by the legal community in corporate cases. he is also member of Company Law Review Commission beaded by former chief justice of Pakistan Ajmal Mian. he has worked on drafting of various laws during his tenure with the SECP. his expertise in corporate law, especially company law and takeovers laws, are largely acknowledged by the legal fraternity.
Major Gainers COMPANY Rafhan Maize Bata (Pak) XD Unilever Food XD Wyeth Pak Ltd XD Shezan Inter.
OPEN 4000.00 1984.50 5000.00 1413.30 435.00
HIGH 4200.00 2083.72 5090.00 1483.96 456.75
LOW 4200.00 2080.00 5090.00 1450.00 440.00
CLOSE CHANGE 4200.00 200.00 2083.72 99.22 5090.00 90.00 1483.96 70.66 456.75 21.75
TURNOVER 1,300 7,650 20 2,150 162,200
441.01 360.00 93.50 84.90 135.25
440.00 360.00 93.10 78.06 131.10
440.67 360.00 93.23 78.06 133.30
-18.32 -9.00 -4.77 -4.10 -2.51
300 200 400 273,500 58,500
11.30 7.60 19.65 3.43 2.46
10.75 7.11 18.81 2.61 2.29
11.30 7.54 18.95 3.29 2.41
1.00 0.19 -0.41 0.72 0.12
27,542,000 16,432,000 11,817,000 11,502,500 11,419,000
Major Losers Sanofi-Aventis XD MithchellsFruit Mehmood Tex Searle Company Thal Limited
458.99 369.00 98.00 82.16 135.81
Volume Leaders TRG Pakistan Ltd. Lotte Chemical Maple Leaf Cement Pervez Ahmed NIB Bank Limited
10.30 7.35 19.36 2.57 2.29
Interbank Rates USD GBP JPY EURO
PKR 98.4244 PKR 152.0361 PKR 0.9979 PKR 128.2076
Forex BUY US Dollar Euro Great Britain Pound Japanese Yen Canadian Dollar Hong Kong Dollar UAE Dirham Saudi Riyal
99.70 128.80 152.79 1.0043 96.59 12.58 26.95 26.45
SELL 99.95 129.04 153.06 1.0147 98.29 12.82 27.20 26.70
Chairman OGRA signals reduction in POL prices ISLAMABAD : OGRA Chairman Saeed Ahmad Khan has signaled reduction in petrol prices in days to come. The OGRA chief said in a statement issued from Islamabad on Thursday that prices of crude oil are coming down globally and it is expected that they would continue dropping further during the next few days. Local prices of oil will be brought down in proportion to the global reduction and efforts would be made to render maximum relief to consumers, added the OGRA chief. Online
CORPORATE CORNER highlight various solar system options available for domestic use. The seminar was widely attended in view of the prevailing energy crisis and severe load shedding that has made life so difficult for most people. Mr. Khan highlighted and emphasized on the need and importance of solar system. He explained various types of solar panels and their suitability, importance of charge controllers and their types, battery types and their suitability, and inverter types. He said that solar energy is environmental friendly and suits our climate as well. In his concluding remarks Khan M Nazir suggested the most economical solutions to address the problem of electricity shortage. PR LAHORE: State Life Chairman Shahid Aziz Siddiqui presents a trophy to Muzafar Ahmed, deputy general manager Corporate Communication, on his best performance for corporate advertising and multi-media coverage of the corporation’s promotional activities. PR
ISLAMABAD: Shafqat Sultana, president of the First Women’s Bank, presides over a meeting of the Board of Directors. PR
spearheaded by renowned Rock Band Noori, and will extend to nearly 250 schools, reaching out to an estimated 250,000 school children between the ages of 12 and 18. PR
Olper’sunveils new packaging formats using 3D technology
Samsung unveils new WB 250 SMART CAMERAs KARACHI: Samsung Electronics Co., Ltd, a global leader in digital media and digital convergence technologies, today announced the launch of upgraded SMART CAMERA and the first devices to run on the new technology: the WB250F. As new additions to the WB series of long-zoom models, DV series of Dual View cameras, the new devices combine high optical performance and classic style with the enhanced connectivity of SMART Camera. Samsung has evolved its innovative Wi-Fi technology to enhance its acclaimed SMART CAMERA, originally announced at CES 2012, by creating SMART CAMERA 2.0. New functionalities and upgrades allow users to shoot and share their cherished photography instantly, revolutionizing the connective camera experience and allowing consumers to be in complete control across the breadth of the SMART CAMERA portfolio. PR
UMT hosts seminar on using solar panel in homes The search for young LAHORE: Khan M Nazir, Assistant Professor at rock stars begins University of Management and Technology (UMT), Lahore, conducted a seminar on “Solar Panel for Our Home”. The aim of the seminar was to
Sparkling brand, has launched a talent hunt in schools across Pakistan to find young gifted singers for recording a Fanta song and music video. The initiative, appropriately named ‘Fanta Rocks’ will be
LAHORE: Fanta, the most fun-filled Orange
KARACHI: Engro Foods’ flagship brand Olper’sunveiled new and innovative packaging formats using holographic technology to create a 3D simulation at a local shopping mall. The new packaging formats include a new format for the region that employs Ecoleantechnology for 250ml, and Tetra Edge for 1 liter pack. Ecolean also referred to as Olper’s Mini Jug is a specialized and convenient jug-shaped pouch that offers ease of pouring and handling the pack. It is an eco-friendly and biodegradable packaging with microwaveable capabilities. Tetra Edge, on the other hand, is a premium-packaging format with benefits of a tilted head and a heli cap, which controls milk spillage, increases the usability of the pack and keeps the milk smell-free. Both these are newest innovations in milk packaging, not just in Pakistan but worldwide. Olper’sis Engro Foods’ flagship dairy brand and has emerged as the leading dairy product in the market since its launch in 2006 after gaining preference over other established brands and securing a loyal consumer base all across Pakistan. Olper’s Milk is sheer indulgence in every sip and is backed by its high nutrition content and invigorating freshness that have become synonymous with the Olper’s brand. The new packaging were unveiled by Olper’s Brand Ambassador Marina Khan. Olper’s created a high
definition, extremely intelligent holographic 3D content iGhost to create a jaw dropping virtual world to interact with audience and to take them on a journey which they have never seen or experienced before.iGhost is a technique which creates threedimensional images. It involves the use of a laser, interference, diffraction, light intensity recording and suitable illumination of the recording. Olper’sprimary reason for introducing the new packaging is to augment a differentiated marketing strategy based on innovation and providing consumers with greater choice.Olper’s aims to be a part of people’s lifestyle choices, as aptly encapsulated in our tagline ‘MeraIntikhab’. Speaking at the occasion, Afnan Ahsan – CEO, Engro Foods said, “Olper’s is a brand that has believed in innovation and recognizing the needs and choices of our target consumers. We continue to focus our efforts on providing increased choices to our consumers and the introduction of this new packaging technology is a testament to this effort that will further preserve the nutrition and goodness of our products and provide maximum utility to our consumers.” Olper’s new packaging style has synced well with its revised communication strategy and will help to break through the clutter on the dairy shelf and enhance Olper’s visibility amongst the target audience. PR