KARACHI - The State Bank of Pakistan on Friday granted its approval to JS Bank Limited (JS Bank) to bid for the acquisition of the entire shareholding of the Royal Bank of Scotland Limited, RBS Pakistan (formerly ABN AMRO Bank, Pakistan) in place of Jahangir Siddiqui and Company Ltd. JSBL also informed KSE via a separate notice that public announcement of intention to acquire shares of the RBS by JS Bank would be published in the newspapers on Monday. As per details, in a notice issued to Karachi Stock Exchange (KSE) here on Friday JS Bank revealed that the directors of JS Bank held an emergent meeting to review the said acquisition opportunity and concluded that this opportunity would enhance the growth of JS Bank. To this end, the board of directors authorised the management to submit binding bid to The Royal Bank of Scotland, KSE notice added. According to the notice, the board of directors also reviewed the proposed funding plan which may include requirement to raise additional equity and/or debt financing on which the board of directors will take the final decision subsequent to the acceptance of the bid. It must be noted that SBP had given in principal approval to Orascom Telecom Holdings and Rojhan Capital on June 2, 2009 for the due diligence of the RBS Pakistan on the application submitted by Orascom International Investment Holdings, Egypt. Earlier, Habib Bank Limited (HBL), MCB bank and Jahangir Siddiqui Company Ltd (JSCL) in separate notices sent to the KSE had expressed their interest in acquiring commercial and retail assets and banking operations of foreign-run RBS in Pakistan. It is worth mentioning here that the Royal Bank of Scotland Group had been badly affected from the global financial crisis therefore; the group had decided to dissociate itself from the business operations of different regions. In this regard, RBS Pakistan on February 26, 2009 had informed the KSE to divest from Pakistan as part of its global strategy and restructuring process. According to some reports, Royal Bank of Scotland Group PLC had short-listed three bidders namely, HSBC Holdings PLC, Standard Chartered PLC and Australia and New Zealand Banking Group Ltd, for its Asian retail- and commercial-banking assets Credit Suisse Group is advising ANZ while Morgan Stanley is advising RBS on the Asia sales. M. Imran, Research Analyst at First Capital, is of the view that the deal has its significance in the sense that RBS is the 14th largest bank in Pakistan on the basis of assets and deposits of the banking sector. While analyzing the probable impact of transaction on the interested buyers, he said if JSBL acquires RBS then it will become the 14th largest bank from its current 27th position. This deal would add more value to JSBL as compare to other two large banks. Moreover, the cost to income ratios of the larger banks will be on the lower side while combined cost to income ratio will also favour the amalgamated JSBL and RBS, he added.