Habib Bank Ltd (HBL) announced on Monday that its Board of Directors has approved an Equity Investment of up to Rs. 6 billion in its subsidiary, as reported to the main bourse.
As per the notice to the Pakistan Stock Exchange (PSX), the board has sanctioned an Equity Investment of up to Rs. 6 billion in its subsidiary, HBL Microfinance Bank Ltd (HBL MfB), adhering to all regulatory requirements and obtaining shareholders’ approval.
Established in 2002 and licensed by the State Bank of Pakistan, HBL MfB is a nationwide microfinance bank. It evolved from the credit and savings section of the Aga Khan Rural Support Program (AKRSP), which has been pioneering the microfinance sector since 1982 in Gilgit-Baltistan and Chitral.
With approximately 203 branches nationwide, HBL Microfinance Bank Ltd has established collection points in underserved financial regions. These facilitate loan repayments and the submission of educational fees for students, enhancing convenience for borrowers and students alike.
In 2023, HBL Microfinance Bank (HBL MfB) cemented its position as Pakistan’s largest microfinance bank. The bank achieved a 14% growth in its loan portfolio, reaching Rs. 97.6 billion, while deposits increased by 10% to Rs. 128 billion. Notably, 33% of its 3.7 million clients are women, highlighting the bank’s dedication to enhancing women’s access to financial services.
HBL MfB is the primary provider of housing finance to microfinance clients, with a portfolio of Rs. 34 billion. It also holds a significant position in agricultural lending, with a portfolio of Rs. 54 billion, second only to HBL. The State Bank of Pakistan (SBP) has designated HBL MfB as the agriculture Champion Bank for Gilgit Baltistan, entrusting it with leading the agri-banking strategy in the region.
Under this designation, HBL MfB has been actively engaged in collaborating with various stakeholders to address region-specific agricultural challenges. The bank has expanded its lending portfolios, including consumer lending reaching Rs. 128 billion, and combined agriculture financing with HBL Microfinance’s agri lending increasing to Rs. 107 billion, capturing a 23% market share by the end of 2023.
