Allied Bank Limited

Allied Bank Limited (الائیڈ بینک لمیٹڈ) is the fifth largest commercial bank in Pakistan and is a subsidiary of Ibrahim Group.[1]

Allied Bank Limited
TypePublic (PSX: ABL)
IndustryFinance and insurance
Foundedas "Australasia Bank", 1942
Lahore, Pakistan
FounderKhawaja Bashir Baksh
Headquarters
Lahore
,
Pakistan
ProductsFinancial services
Revenue75 billion PKR
ParentIbrahim Group
Websitewww.abl.com

Allied Bank, with its registered Office in Lahore, is one of the largest banks within the country with over 1350 branches and ATMs. It was the first Muslim bank established in Pakistan before independence (1942) with the name of Australasia Bank. It was named as Allied Bank of Pakistan from Australasia Bank Limited in 1974, and Sarhad Bank Ltd, Lahore Commercial Bank Ltd and Pak Bank Ltd were also merged in it.

History

ABL is the first Muslim Bank established on territory that later on became Pakistan. It was established on December 3, 1942, as Australasia Bank at Lahore with capital of 0.12 million by Kashmiri silk trader Khawaja Bashir Baksh.[2]

The bank's history is divided into many phases. During 25 years of united Pakistan the bank advanced forward in all areas of its activities. 1970's were a difficult decade for all banks of Pakistan. In 1971 East Pakistan was separated and Australasia Bank lost its 50 branches and a lot of capital as well. Nevertheless, the growth remained steady.

In 1974, all the banks were nationalized including Australasia Bank. The small provincial banks were merged into Australasia Bank. On 1 July 1974 the new entity was renamed as Allied Bank of Pakistan Limited. Then it started its operations as a public sector financial institution.

The Pre-Independence Period (1942-47)

Australasia Bank had the unique distinction of being closely identified with some of the country's most prominent leaders of the Pakistan Movement such as Mian Mumtaz Daultana on (Board of Directors), Mian Iftikhar Hussain and Maulana Zafar Ali Khan.

The bank originally started its operation in the garage of Khawaja Bashir Baksh's bungalow (who was the chairman) near the Lahore Railway Station. But the success of the bank enforced the directors to open another branch in Anarkali Bazar on 1 March 1944. Khawaja Bashir was first chief executive. He was the person who was really working hard for its development. His sincerity of purpose can be judged from his great initiatives.

Another branch was opened at Amritsar in 1945. In June 1946, the bank earned the status of scheduled bank. During 1946-47, many other branches were opened at Mcleod Road, Lahore, Jallandhar, Ludhiana, Agra and Delhi.

During independence, the industrial and commercial sectors were underdeveloped but ABL contributed a lot in the development of these sectors.

Australasia Bank in Private Sector (1947-74)

It was the only fully functional Muslim Bank on the land of Pakistan. On August 14, 1947, Allied Bank was identified with the Pakistan movement. Many of its board of directors were prominent Muslim League leaders. Jallandhar and Ludhiana branches were attacked by rioters because of Muslim staff appointed in these branches. All the branches in India were closed down when the Pakistani flags were hoisted on them. With this, the bank lost almost 6 branches along with a lot of capital and deposits. During 1948 new branches were opened in Karachi, Rawalpindi, Peshawar, Sialkot, Sargodha, Jhang, Gujranwala and Kasur. Later on, its branches spread to Multan and Quetta as well. At that time, the bank financed trade in cloth and food grains and thus maintained consumer's supplies during the riot-effected early months of 1948. Australasia Bank made a profit of PKR 50,000 in 1947-48.

In August 1948, Australasia Bank became the first Pakistani bank to successfully negotiate and open L/C for a Sialkot-based importer of books. So it also made correspondence relations with Midland (UK), Chase Manhattan (USA) and Lloyds (India).

Other than providing the treasury functions of Federal Government of Pakistan, it also acted as banker to several local government bodies and to the University of the Punjab during this period. Treasury functions were taken over by National Bank of Pakistan in 1949. In 1950-51, the chairman was replaced by his own brother Khawaja Sharif Baksh.

During 1955-56, Naseer A. Sh. became the Chairman of the Board and close working relationship was forged between the new chairman and the managing director. This partnership proved in modernizing the bank's operations and consolidating its financial position.

In 1963 M A K Yousufi Deputy General Manager of Muslim Commercial Bank took over as General Manater of ABL and at that time it had 29 branches in various cities. Its deposits were 89 million and advances were 66 million. Bank was mainly concerned with general banking and trade financing (including foreign exchange transactions). It helped a lot in development of small and medium-sized business houses. These included Nishat, Crescent, Pak Cement, Haroon Traders, Takht Bhai Sugar, Insaf, Punjab Soap, Pak Fruit and Saboor Oil Mills etc.

In 1964, 13 new branches were opened including 3 in East Pakistan. In 1965, 17 new branches were opened and over 83% of the gross profit for the year was earmarked for development expenditure in connection with opening of new branches.

In 1966 Yousufi opened 26 new branches and doubled its reserved funds. For the first time in history, its advances raised to PKR 160 million and deposits 0increased by almost 58% exceeding PKR 232 million mark. In 1966, its Central Office was built in Karachi but Head Office remaining at Shah Chiragh Building, Lahore.

16 new branches were opened in 1967 and 20 in 1968. Likewise, the bank's funds increased gradually with these new openings. 21 new branches were opened in 1971. But, due to the separation of East Pakistan, 51 branches were lost by the bank which was a big loss. The Senior Executives Khadim Hussain Siddiqui and Inam Elahi were taken as prisoner of wars by India occupied Bangladesh

Allied Bank: Public Sector Years (1974-91)

Under the Nationalization Act of 1974, 14 scheduled banks were taken over by the government. Australasia Bank's board of directors was dissolved and the bank was renamed as Allied Bank of Pakistan Limited. Sarhad Bank, Lahore Commercial Bank and Pakistan Bank Limited were merged into Australasia Bank. At the time of this merger, ABL was second highest among all the banks which were nationalized in 1974.

Allied Bank's first executive board was constituted of Iqbal A. Rizvi as President, Ajmal Khalil as Joint President and Khadim Hussain Siddique as member. In 1974, I.D. Junejo and Safdar Abbas Zaidi also joined the board. 116 new branches were opened in 1974 and ABL started participating in the commodity operation program of the government.

In 1970's, the bank played an important part in agricultural area loans and other loans. In 1976, Ajmal replaced Rizvi as Chief Executive and President. During 1974-77, 361 new branches were opened and 230 of these were located in villages and small towns. It also opened its foreign branch in London, near the Bank of England. In 1980 the Bank of England granted Allied Bank recognition as a full-fledged bank under the U.K. Banking Act.

In 1981, Khadim Hussain Siddiqui took over as President. In 1984, again upon his retirement Khadim Hussain Siddiqui was replaced by I.D.Junejo as new president. He tried to increase the international business of the bank. At that time, ABL also initiated a major counter program. In 1985, mainframe computer was installed and effective management system was developed. During this period profitability was increased. New president Maqbool Somoro took over after death of I D Junejo and introduced different schemes in 1987-88. In 1989, 13 new branches were opened.

In 1991, there were 745 branches all over Pakistan.

Privatization (1991-2004)

In November/December 1990, the government announced its commitment to the rapid privatization of the banking sector. Allied Bank's management under the leadership of Khalid Latif decided to react positively to this challenge. As a result of privatization in September 1991, Allied Bank entered in a new phase of its history, as the world's first bank to be owned and managed by its employees.

Allied Bank's capital and reserves were PKR 1.525 billion. Its assets amounted to PKR 87.536 billion and deposits were PKR 76.038 billion. The bank enjoyed an enviable position in the financial sector of Pakistan and was recognized as one of the best amongst the major banks of the country. In August 2004, as a result of capital reconstruction, the bank's ownership was transferred to a consortium of Ibrahim Leasing Limited and Ibrahim Group.

2005-to-date

In May 2005, Ibrahim Leasing Limited was amalgamated with Allied Bank Limited. ILL shareholders were issued ABL shares in lieu of the ILL shares held by them.

In December 2014, the Government of Pakistan sold-off its remaining 11.5 percent stake in ABL for PKR 14.4 billion. The deal was sealed-off at a strike price of Rs. 110 per share for the remaining 131.3 million shares of the government.[1][3]

Credit Rating

Long Term Credit Rating of Allied Bank Ltd is June 30, 2020, maintained at AAA [Triple A] and Short-Term Credit Rating of the bank is maintained at A1+ [A one plus] by Pakistan Credit Rating Agency (PACRA).[4]

Products

The bank provides its customer various products and services, to cater their need for investments, and other social or business necessities. These Product and Services offered by the bank are as follows:

Personal Banking

Under Personal Banking, ABL offers Everyday Accounts, Lifestyle Banking, Savings & Term Deposits, Credit & Debit Cards, Domestic Remittance, Bancassurance, and Digital Banking Services (including myABL Personal Internet Banking, myABL Mobile App, myABL FonePay App and SMS Banking).

Business Banking

Under Business Banking, ABL offers Corporate & Investment Banking, Transaction & Business Accounts, Home Remittances to Pakistan, Cash Management Solutions, Trade Services, SME Financing, Agriculture Financing, Business Internet Banking.

Islamic Banking

In September 2018, ABL opened its Shariah-compliant Aitbaar Islamic Banking service through its 117 dedicated Islamic banking branches network across 53 major cities of Pakistan.[5]

Other Services

Other services offered by Allied Bank include Extended Hours Banking, Online Banking, Safe Deposit Lockers, Utility Bills Payments, Allied Phone Banking, Customer Support and car Financing.

Digital Banking

Allied Bank maintains its reputation for innovation in operations and embracing new technologies in the banking sector of Pakistan. Their current suite of Digital Banking services comprises

  • myABL Digital Banking (including myABL Personal Internet Banking and myABL Business Internet Banking)[6]
  • Allied SMS Banking[7]
  • myABL Mobile App (Android and iOS)[8]
  • myABL FonePay App (Android and iOS)[9]
  • Automated Teller Machines (ATMs)[10]
  • Transactional Alerts Facility[11]
  • Phone Banking[12]

Awards and recognition

FinCEN

Allied Bank was named in FinCEN leak, published by Buzzfeed News and the International Consortium of Investigative Journalists (ICIJ). It had twelve suspicious transactions flagged.[14]

See also

References
  1. Ali Raza Mehdi (3 November 2014). "Allied Bank's privatisation". Dawn (newspaper). Archived from the original on 12 April 2019. Retrieved 27 October 2019.
  2. Tirmizi, Farooq (16 December 2019). "How to grow a Big Five bank: the case of ABL".
  3. Shahbaz Rana (13 December 2014). "Divestment: Govt sells Allied Bank stake for Rs14.4b". The Express Tribune (newspaper). Archived from the original on 12 April 2019. Retrieved 27 October 2019.
  4. "The Pakistan Credit Rating Agency Limited" (PDF). pacra.com.pk. Retrieved 25 September 2020.
  5. "ABL opens Islamic banking window". The Express Tribune.
  6. "myABL Digital Banking, Allied Bank". Archived from the original on 28 May 2018. Retrieved 28 May 2018.
  7. "Allied SMS Banking, Allied Bank". Archived from the original on 14 July 2014. Retrieved 20 June 2014.
  8. "myABL Mobile App, Allied Bank". Archived from the original on 21 June 2018. Retrieved 21 June 2018.
  9. "myABL FonePay App, Allied Bank". Archived from the original on 21 June 2018. Retrieved 21 June 2018.
  10. "Branches & ATMs, Allied Bank". Archived from the original on 14 July 2014. Retrieved 20 June 2014.
  11. "Transactional Alerts Facility, Allied Bank". Archived from the original on 14 July 2014. Retrieved 27 October 2019.
  12. "Phone Banking, Allied Bank". Archived from the original on 29 April 2018. Retrieved 8 March 2018.
  13. "Islamic Finance Excellence Awards 2017". Center of Islamic Finance. 20 June 2017. Archived from the original on 19 September 2017. Retrieved 27 October 2019.
  14. Report, Monitoring (21 September 2020). "Six Pakistani banks named in FinCEN leak". Profit by Pakistan Today. Retrieved 23 September 2020.
This article is issued from Wikipedia. The text is licensed under Creative Commons - Attribution - Sharealike. Additional terms may apply for the media files.