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Submitted to MR. RIZWAN Submitted by UMAIR HASSAN cont.



stands for Initial Public Offering. As the name suggests its the process where in a company goes to public for the first time for raising money by offering ownership in the company. In this process a private limited company becomes Public Limited Company.

Bolster Enable

and diversify equity base cheaper access to capital without borrowing

Expansion Cash


Access to IPO Markets: Position:

Financial Growth


Potential Loss Of Control Disclosure Of Information

Increased Costs

Of IPOs Restrictions On Management Action On Short-Term Performance


Emphasize Decisions

take time

The HBL IPO is the largest offering ever in Pakistan in terms of both value and number of successful applicants. Road show Presentations for the Offer for the Sale of Shares of Habib Bank Limited (HBL) were held in Karachi on July 23, 2007 and in Lahore on July 24, 2007. The Offer for Sale was conducted by the Privatization Commission, Government of Pakistan out of State Bank of Pakistans shareholding in HBL.

Preparing Detail financial results The prospectus IPO Registration issues Cost involved in going public Market Pressure Restrictions on management

Strengths: Habib Bank Limited is well established bank enjoying long history of over 65 years of experience and profitable operations. It has the largest branch network. HBL is the market leader in introducing e-banking. It has the largest ATM network in Pakistan.

Weaknesses: HBLs weakness is that its mission is not defined. Though HBL is the second largest bank in Pakistan, yet the fact remains that it is not market leader as NBP. Its total assets are always less than NBP total assets. Most of the employees lack managerial training.

Opportunities: Habib bank of Pakistan enhances its Rupee travelers cheques (RTCs) sales by searching for new market niches. It can introduce debit card system. HBL is planning to develop network for electronic transactions.

Threats: The low discount rates are negatively influencing the advances rates which may affect the banks profit on the other side. Foreign banks are operating in Pakistan by providing new technologies and better quality services which is a major threat to HBL.

Earnings management usually involves the artificial increase (or decrease) of revenues, profits, or earnings per share figures through aggressive accounting tactics. Aggressive earnings management is a form of fraud and differs from reporting error.

Unsuitable revenue recognition Inappropriate accruals and estimates of liabilities Excessive provisions and generous reserve accounting Intentional minor breaches of financial reporting requirements that aggregate to a material breach.