The Orix Leasing Pakistan board of directors (BoD) has approved the amalgamation scheme of Standard Chartered Leasing Company within the company in an extraordinary general meeting of its shareholders, the notification to Pakistan Stock Exchange said.
Standard Chartered Bank owns 84 percent shareholding in Standard Chartered Leasing Company whereas the minority shareholders include seven investors with stakes of 2,370, totalling 16,590.
Orix Leasing Pakistan signed a sale purchase agreement with Standard Chartered Bank of Pakistan to buy and merge its two subsidiaries - Standard Chartered Leasing Company and Standard Chartered Mudaraba in September 2015.
The management of Standard Chartered Bank decided to concentrate on its core banking operation while relieving out its business of financial services through amalgamation of a subsidiary, Standard Chartered Leasing Company with Orix Leasing Pakistan Ltd, and divestment in Standard Chartered Modaraba.
Standard Chartered Leasing subsidiary is one of the leading leasing companies in Pakistan, catering primarily to SME and retail customers, offering commercial and auto leasing and investment opportunities through certificate of investments.
In nine months of 2015, the company profit squeezed to Rs 14.59 million in Jan to Sept as compared with Rs 21.15 million showing a decline of 31 percent in profit.
During the period, net interest income of the company dropped by 25% from Rs 123.98 million in corresponding quarter of the last year to Rs 92.84 million, in the quarter ended September 30, 2015. The major reason for this decrease, which is impacting the bottom line as well, is decrease in interest rates by 3% during the current period compared to corresponding quarter of the last year.
A reduction in finance cost and administrative expenses, supported by efficient recovery efforts that resulted in reversal of provision for doubtful leases compared to charge during the corresponding quarter of last year, compensated drop in revenue to some extent. PR