Meezan Bank is Pakistan's largest Islamic bank. It has grown rapidly due to being the first to offer Islamic banking services. Meezan Bank has a strong market position with over 35% market share in deposits and assets. While competition is intense, Meezan Bank is well-positioned for continued growth due to its innovative Shariah-compliant products and expanding branch network. Based on Meezan Bank's recent strong financial performance and Pakistan's projected GDP growth, the preliminary decision is to buy the stock, pending a thorough financial analysis.
Meezan Bank is Pakistan's largest Islamic bank. It has grown rapidly due to being the first to offer Islamic banking services. Meezan Bank has a strong market position with over 35% market share in deposits and assets. While competition is intense, Meezan Bank is well-positioned for continued growth due to its innovative Shariah-compliant products and expanding branch network. Based on Meezan Bank's recent strong financial performance and Pakistan's projected GDP growth, the preliminary decision is to buy the stock, pending a thorough financial analysis.
Meezan Bank is Pakistan's largest Islamic bank. It has grown rapidly due to being the first to offer Islamic banking services. Meezan Bank has a strong market position with over 35% market share in deposits and assets. While competition is intense, Meezan Bank is well-positioned for continued growth due to its innovative Shariah-compliant products and expanding branch network. Based on Meezan Bank's recent strong financial performance and Pakistan's projected GDP growth, the preliminary decision is to buy the stock, pending a thorough financial analysis.
Meezan Bank is Pakistan's largest Islamic bank. It has grown rapidly due to being the first to offer Islamic banking services. Meezan Bank has a strong market position with over 35% market share in deposits and assets. While competition is intense, Meezan Bank is well-positioned for continued growth due to its innovative Shariah-compliant products and expanding branch network. Based on Meezan Bank's recent strong financial performance and Pakistan's projected GDP growth, the preliminary decision is to buy the stock, pending a thorough financial analysis.
SUBMITTED BY MISBAH HAROON (NIM-BBA-2019-22) ALVEENA BASHEER (NIM-BBA-2020-13) AJMAL RAFIQUE (NIM-BBA-2020-14) Introduction of the company Meezan Bank is Pakistan's largest dedicated bank. It was founded on January 27, 1997. Mr. Irfan Siddiqui is the founding President and CEO of Meezan Bank. Meezan Bank became the first Islamic bank in Pakistan, in 2002. History: The bank started as an investment bank and was also known as Al-Meezan Investment Bank. In 2002, Meezan Bank acquired the Pakistan operations of Societe Generale. In 2014, Meezan Bank signed an agreement with HSB Bank Middle East to acquire HSBC's Pakistan operations consisting of 10 branches. Then they got approval from the state-bank of Pakistan as the first Islamic bank. In 2015, Meezan Bank acquired the Pakistan operations of HSBC Oman consisting of a single branch. Vision: Establish Islamic banking as banking of first choice to facilitate the implementation of an equitable economic system, providing a strong foundation for establishing a fair and just society for mankind. Mission: To be a premier Islamic bank, offering a one-stop shop for innovative value-added products and services to our customers within the bounds of Shariah, while optimizing the stakeholder’s value through an organizational culture based on learning, fairness, respect for individual enterprise, and performance. Values: Shariah-compliance, Integrity, Service Excellence. Reasons behind Growth: Meezan bank was the first bank that provided an Islamic banking system. Therefore Meezan bank is the fastest-growing financial institution in the banking sector of Pakistan. Shariah compliance is the major reason behind their growth. Their success over the years is the result of their dedicated approach to nurturing and developing human resources, whom they consider being an integral asset to the organization. Meezan bank three times got the best bank award, even most recently in the year 2022. Target market: They target their depositors and retail investors that actually want a completely Islamic banking system. Major Offerings (Shariah-compliant Advisory Products): Depending upon customers’ requirements, we provide arrangement, shariah structuring/advisory, underwriting and placement services for privately placed and listed sukuks. Moreover, Meezan banks’ specialist team offers a wide range of equity and advisory products including innovative shariah-compliant solutions for:
• Mergers • Acquisitions • Buy-side / sell-side advisory • Financial Restructuring • Structured Equity • Initial Public Offerings • Private Placement of Equity • Venture Capital Investments
Shareholders:
• Noor Financial Investment Company (35.25 percent)
• Pak Kuwait Investment Company (30.00 percent) • Islamic Development Bank (9.32 percent)
Industry Analysis (Competitors, Market Capitalization, etc.)\
Meezan Bank Limited is a Pakistani commercial bank that provides Shariah-compliant banking services. Here is an industry analysis of Meezan Bank: Competitors: • Habib Bank Limited • United Bank Limited • National Bank of Pakistan • Allied Bank Limited • Askari Bank Limited Market Capitalization: As of September 2021, Meezan Bank's market capitalization was approximately PKR 198 billion (USD 1.2 billion). Current Standing in the Industry: Meezan Bank is the largest Islamic bank in Pakistan, with a market share of around 35% in terms of deposits and assets. According to the State Bank of Pakistan, Meezan Bank's total assets stood at PKR 1.7 trillion (USD 10.5 billion) as of June 2021. The bank has a strong presence in the retail and corporate banking segments and has been consistently growing its profitability over the years. Meezan Bank was also named the "Best Islamic Bank in Pakistan" by Global Finance in 2021. Meezan Bank operates in a highly competitive banking industry in Pakistan. The industry is dominated by a few large commercial banks, including Habib Bank Limited, United Bank Limited, and National Bank of Pakistan, among others. These banks offer a wide range of banking products and services, including conventional and Islamic banking, to cater to the needs of various segments of customers. Despite the intense competition, Meezan Bank has managed to establish itself as a leader in the Islamic banking sector in Pakistan. The bank's commitment to Shariah-compliant banking, combined with its innovative products and services, has helped it gain a strong foothold in the market. Meezan Bank offers a wide range of Islamic banking products and services, including deposit accounts, financing solutions, investment products, and trade services. Meezan Bank's market capitalization has been steadily increasing over the years, reflecting investors' confidence in the bank's growth prospects. The bank has also been expanding its network of branches and ATMs across Pakistan, enabling it to reach out to a larger customer base. As of June 2021, Meezan Bank had a network of 840 branches and over 3,000 ATMs across the country. Meezan Bank's strong financial performance has been recognized by various industry experts and rating agencies. The bank has won numerous awards for its performance and innovation in the Islamic banking industry. Meezan Bank's commitment to providing quality services to its customers and maintaining a high level of transparency and ethics has helped it establish a strong reputation in the market. Overall, Meezan Bank is well-positioned to continue its growth trajectory in the highly competitive banking industry in Pakistan.
Ts Growth Prospects Regarding Meezan Bank's investment policies, the bank focuses on providing Shariah-compliant investment solutions to its customers. The bank invests in a range of sectors, including energy, technology, textiles, and consumer goods. Meezan Bank's investment portfolio is diversified, with investments in both long-term and short-term assets. The bank's investment strategy is guided by its Shariah Supervisory Board, which ensures that all investments comply with Islamic principles. In terms of investment policies, Meezan Bank's net spread has increased by 46% to Rs45.48 billion in the first six months of 2022, indicating a profitable business model. However, the bank's operating expenses have also increased by 25% to Rs20.74 billion, which may be a cause for concern. Meezan Bank has shown strong financial performance in the first half of 2022, with a 33% increase in profit-after-tax compared to the same period in the previous year. The bank also reported an increase in earnings per share, from Rs7.83 to Rs10.48. The country's GDP growth is forecasted to be around 4% in 2022, according to the World Bank. This growth is expected to be driven by an increase in investment and private consumption. In the banking industry specifically, the State Bank of Pakistan has maintained an accommodative monetary policy stance to support economic growth. This may present opportunities for Meezan Bank to expand its lending portfolio and increase profitability. In terms of industry-specific numbers, the banking industry in Pakistan is expected to continue to grow in the coming years, driven by a combination of favorable government policies and a growing middle class. The State Bank of Pakistan has set an ambitious target of increasing the share of Islamic banking in the overall banking industry to 30% by 2025, which could provide a significant growth opportunity for Meezan Bank Pakistan. Overall, Meezan Bank Pakistan's outlook appears to be positive, given its focus on Shariah- compliant banking and its investment in technology and digital platforms. However, the bank will need to navigate the ongoing economic challenges facing Pakistan and the banking industry as a whole.
Preliminary Investment Decision
Meezan Bank's profit and earnings per share have increased, indicating strong financial performance. The bank's net spread has also increased, which is a positive sign for its profitability. The forecasted GDP growth and accommodative monetary policy may present opportunities for Meezan Bank to expand and increase profitability. So based on this primary information, we would buy its stock, but we will conduct a thorough analysis of the bank's financial statements, market trends, and macroeconomic factors to finalize our primary decision.
References: • Meezan bank official website https://www.meezanbank.com/ • World Bank. (2022). Pakistan Economic Update, Spring 2022: Recovering from COVID- 19. Retrieved from https://openknowledge.worldbank.org/handle/10986/37289 • State Bank of Pakistan. (2022). Monetary Policy Statements. Retrieved from https://www.sbp.org.pk/monetary_policy/statements/index2.asp
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