JS Bank announces acquisition of HSBC Pakistan

JS Bank has announced acquisition of HSBC Pakistan operations. The bank is rated as A+ (Single A Plus) by Pakistan Credit Rating Agency (PACRA) and is listed on the Karachi Stock Exchange, is a majority-owned subsidiary of Jahangir Siddiqui & Co. Ltd. and currently operates 153 branches in 82 cities with a total asset base of Rs64.53 billion as of June 30.

 JSBL’s interest in HSBC’s Pakistan operation has to do with HSBC’s strong footprint in the consumer banking, something which JSBL lacks, as well as a potential enhancement of the bank’s tier 1 capital.

Turkey's Isbank was looking into buying HSBC's Pakistan branches
Turkish lender Isbank bid to buy Europe's biggest bank HSBC's branches in Pakistan has failed. Now there are rumors that they will fight for Citibank Consumer Division from country's biggest banks including Pakistan's largest HBL, Faysal Bank, NIB (Subsidiary of Temasek Singapore) and Bank Alfalah (of Abu Dhabi group).

First China and Now Turkey 
After Chinese banks long trying to get into Pakistan’s banking industry and facing stiff competition from UAE’s Abu Dhabi Group (UBL Omni) and British funded Norwegian banking service EasyPaisa. Its the Turkish Isbank eyeing Pakistan's most successful Citibank Consumer Division. This will be a major development in Pakistan’s banking and financial sector and it will add another Pakistan-friendly nation into Pakistan’s financial sector.

Bank of China Planning Entry in Pakistan

After Industrial and Commercial Bank of China (ICBC), its the Bank of China (BOC) which is planning its entry into Pakistan according to the sources at Dawn Media Group. Exit of western banks such as Royal Bank of Scotland (RBS), HSBC and Citibank which is closing its commercial operations in the country and the entrance of Asian giants from China and India suggest changing dynamics of banking industry in Pakistan more focusing towards trade, industrialization and investment rather consumerism.

The Industrial and Commercial Bank of China (ICBC) currently has one branch in Karachi and Islamabad each and is the world’s biggest bank by capitalization while BOC, in which the Chinese Sovereign Wealth Fund holds a substantial stake is headquartered in Beijing, providing corporate and personal banking services in addition to investment banking.

 The expanding bilateral trade between Pakistan and China has attracted Chinese financial market giants, which are already present in many countries including Africa, to mark their presence in Pakistan. Currently Pakistan's local giants such as HBL, UBL, ABL and MCB depends upon government papers for profitability and the entrance of Chinese banks suggest changing of this trend.

Analysts suggest that this move by Asian banks will also help China to tap the potential of Arabian markets as they have large investments in Pakistan though they are not expanding their operations and large middle eastern groups such as Emaar and Enshaa have failed to deliver on their promises.

Opening up of Indian banks will also help India increase its trade with Pakistan, Afghanistan and Central Asian republics.

It is worth mentioning here that Pakistan has recently signed Currency swap agreement with China and Iran.

Pakistan is a $500 Million Market for Google

Pakistan is one of the biggest markets for Google in Asia with a revenue base of $500 million, according to executives of Google who said this in Karachi's Pearl Continental Hotel at a gathering of IT experts, bloggers, businessmen and selected journalists.

The gathering comes after a visit to Islamabad by Google’s executive chairman Eric Schmidt in June to meet with the country’s politicians and businessmen. “It was just a regular visit. He wanted to find out how important the use of technology for the country’s leadership and businessmen is,” said Badar Khushnood, Google’s consultant in Pakistan.

Google has recently partnered with Punjab government in a project called “Innovation Punjab” and has also launched a social innovation fund – in collaboration with Pakistan Software Houses association to support young entrepreneurs struggling to get their ideas public.

Though Google has no office in Pakistan but the launch isn't ruled out. Pakistan currently has 22 million internet users, which is more than Australia's whole population. Also 4 of the top 10 websites in Pakistan are Google's sites, said Jana Levene from Google. Google may have reservations regarding internet censorship, imposed for the first time in Pakistan and absence of some intellectual property rights and cyber laws before planning to open office in the country.

Fast Facts

• Pakistan has 22 million internet users including 2 million broadband users
• Seven million Pakistani users are on Facebook
• One million on Twitter and 1.2 million on LinkedIn
• 6% of mobile phones sold in Pakistan are smart-phones
• Google Pakistan receive over eight million queries daily
• 386,000 are telecom queries, which translates to 15,000 queries every hour
• Government of Pakistan reached 800,000 people using Google Earth/ Maps tools to track areas affected by 2010 floods. 

Why Ain't We Promoting Entertainment & Tourism Together

Tourism in Pakistan is stated as the "next big thing" by Lonely Planet but the industry is lacking marketing and innovation. On the other hand our Entertainment Industry is not finding any integration with Tourism Industry for bringing in new things.

Lately we have seen the rise in Entertainment Culture again in Pakistan which has become possible by only innovation. Masala TV is the lead here which has introduced Pakistan's first 24 hours food channel and several other gimmicks such as live chat, recipes on mobile, meeting of their chefs at different exhibitions and trade shows, making them the celebrities and of course they also put a positive mark on the City of Karachi not just across Pakistan but also overseas.

These celebrities endorsements has lead to successful businesses by Cafe Ginger, Meat One, Omore, Braun and several others. Creating demand for these brands in other parts of Pakistan and also at places where South Asian population resides in North America and Europe.

Music shows such as Coke Studio and Nescafe Basement are also very popular among the masses not only in Pakistan but also across South Asian population overseas. But as my title of the story suggests that we need to use this for creating a successful brand resonance ie. positioning and segmenting your brand with people, places, things and other brands for a powerful communication message.

Pakistan Tourism Development Corporation should undertake partnership with these Entertainment giants and City Planners to realize our innovative tourism industry's potential.

Tags 

• Madame Tussauds, the world's famous Wax Museum to open at Port Grand
• Giant Aquarium and Underwater world to open at Clifton Dolmen City
• Coke Studio studios has moved from Korangi to Port Grand
• Ski Karachi Coming Soon

Japanese Auto Giants Unhappy with People's Party Lawmakers

An official from embassy of Japan told media in Pakistan that its government is no longer considering investment in major hydroelectric projects such as Diamer-Bhasha dam and revival of Karachi Circular Railway (KCR) because of financial constraints.

Pointing out inconsistencies in policies of Pakistan People's Party government, he said: “This takes Pakistan out of the scope of Japanese companies.”

He added that Japanese firms working in Pakistan are facing a “lot of problems” and the Board of Investment (BOI), which should act as a facilitator for foreign investors, “has no action plan”.

 The embassy, he said, was receiving complaints from Japanese companies working in Pakistan regarding “absence of any appropriate auto policy, macroeconomic instability, power shortages and recent ban on CNG kits. This has deeper impact on the economic health of companies”.

 Despite difficulties, he believed, there was a huge potential to attract foreign investment. “High-skill labour force and growing market is a favourable factor. Similarly, Pakistan has geographical advantage, as it is located on crossroads to India, Afghanistan, Central Asia and the Gulf.”

 He said that the government of Japan will soon send business mission to visit Pakistan from October 6-11, to coincide with Expo Pakistan in Karachi. “This Business Mission will include (representatives of) Japanese companies interested in investing in Pakistan. The objective is to address concerns of companies regarding security, infrastructure, economic policy consistency and lack of marketing.”

After Brink's, Security giant GS4 decided to leave Pakistan

The world's top security firm, UK-based G4S, has decided to leave Pakistan, where it operates under the name Wackenhut Pakistan Ltd, following a government crackdown in Islamabad on foreign security companies suspected of supporting terrorism in Pakistan. It is the second foreign firm to pull out of Pakistan after US-based Brink's Company which left the country in 2001 and re-named to Phoenix Armour Pvt Ltd. The G4S came into global attention when it failed to supply an agreed number of security personnel for the London Olympics, forcing the UK to deploy its army troops in London for security.

G4S was founded as a result of the merger of the United Kingdom-based Securicor plc with the Denmark-based Group 4 Falck in 2004, is a multinational security services company. It received its license to operate in Pakistan about 20 years ago and employs more than 10,000 personnel, including 150 women guards with clients ranging from United Nations to multinational companies, banks in Karachi, Islamabad, and Lahore.

The private security business is booming in Karachi, the country's financial capital, where a worsening security situation continues to fuel investors' concerns. Federal Government of Pakistan has so far been least concerned about the problems of the businessmen and industrialists in Karachi, where industries contribute 67% to national coffers and 35% to gross domestic product. 

Foreign direct investment (FDI) fell 50% to $812 million in the financial year that ended on June 30, as against $1.63 billion in the previous 12 months. The decline in foreign investment is attributed to political uncertainty, a deep and worsening energy crisis and the prevailing law and order situation. 

Citibank is Closing its Commercial Operations in Pakistan

After RBS and HSBC, its the Citibank which is closing its commercial operations from Pakistan despite having net income jump of 391% and having Rs70 billion in deposits and a total asset book of about Rs96.4 billion ($1.4 billion).

 Citigroups Citibank shuttered its equity research office in Karachi, Pakistans financial capital, in March, followed by Credit Suisse Group which closed its research operations earlier this year and JPMorgan Chase which suspended its brokerage operations in 2008, also in Karachi.

 Credit Suisse has closed its research division but still covering Karachi-based companies from Singapore and JPMorgan has still retained its seat on the exchange but is not active in the country.

 In 1990s Citibank has innovated commercial market operations in Pakistan by introducing several new products such Credit Cards, Online Shopping, Mortgage and Auto Finance. But it appears now that it has lost its interest in consumer banking and Standard Chartered Bank is the only large foreign bank still has huge interest in Pakistan.

It is worth mentioning that British Petroleum has also closed its operations in Pakistan recently.

 Most of the depositors to Citi Bank are large corporations and multinationals.