The government is to go ahead with the sale of a 26 per cent stake in United Bank (UBL) on 22 January, despite parliamentary opposition. The opposition has argued that the sale should be delayed in order to allow debate on the issue of Pakistani financial institutions being taken over by foreign investors. Both prequalified groups are from the Middle East (MEED 24:11:95).

The sale of a 26 per cent strategic share in Bankers Equity (BE) has also attracted foreign interest. Six companies have applied to prequalify. They are the Dubai-based Galadari Group, Bahrain-based Islamic Investment Company, the local House of Prudential, a local joint-venture comprising Guardian Leasing and Crescent Investment Bank, and Sardar Ashraf D Baloch, a local construction company.

Financial advisers, the local BMA Capital Management, say that Sardar Ashraf D Baloch does not meet the criteria for prequalification.

A BMA spokesperson said that the prequalification list will be announced before the end of January and that bids will be submitted around four weeks later (MEED 15:12:95).

In answer to the opposition, the government has reiterated its commitment to foreign investment. ‘It is a stated government policy to encourage foreign investment and the banks are no different,’ Privatisation Commission chairman Naveed Qamar said. Pakistan also has plans to sell a 26 per cent stake with management control of Habib Bank, the largest nationalised commercial bank, by mid-1996.