The shareholders of Silkbank Limited approved the merger of the bank with and into United Bank Limited (UBL). The decision was taken at the Extraordinary General Assembly Meeting held on Thursday, 26 December 2024, and remains subject to regulatory approvals.
This decision follows UBL’s offer dated 31 October 2024 for the proposed merger. On November 1, 2024, as consideration for the merger, UBL proposed to issue and allocate new UBL common shares to Silkbank shareholders on the basis of a ratio of one (1) new UBL common share for every 325 Silkbank common shares.
In response, Silkbank’s Board of Directors gave preliminary approval to the potential merger on 6 November 2024. The Board of Directors also authorized the bank’s CEO to engage advisors and consultants to evaluate UBL’s offer and submit their findings for further consideration.
The merger is expected to have significant implications for both banks, as Silkbank’s shareholders prepare to become part of UBL’s broader operational framework, pending regulatory approvals.
Silkbank published its 2022 financials in December 2024, disclosing negative equity of Rs13.9 billion at the end of 2022. This figure is well below the minimum capital requirement of Rs10 billion.