Bank Alfalah Limited (BAFL) has secured crucial regulatory approvals to move ahead with the sale of its Afghanistan operations to Ghazanfar Bank, according to the bank’s filing with the Pakistan Stock Exchange (PSX) on Wednesday.
Bank Alfalah said in a disclosure that the State Bank of Pakistan (SBP) granted an in-principle approval for Ghazanfar Bank to begin due diligence on BAFL’s Afghanistan business. In addition, the Central Bank of Afghanistan has also authorised the process, allowing Ghazanfar Bank to proceed.
This development comes after a non-binding offer from Ghazanfar Bank to acquire BAFL’s Afghanistan operations was made public in on December 4, 2025. As part of the next steps, BAFL has confirmed that Ghazanfar Bank will now initiate the due diligence process, which is essential for the proposed acquisition.
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The deal, however, remains contingent on the successful completion of due diligence, execution of definitive agreements, and compliance with all applicable legal and regulatory requirements. Once finalised, the transaction is set to reshape BAFL’s presence in Afghanistan, marking a significant shift in the region’s banking sector.
The proposed acquisition will also require final approvals from both Pakistani and Afghan authorities, further emphasising the transaction’s complexity and cross-border nature.
Last month, Bank Alfalah disclosed that it had accepted a non-binding offer from Afghanistan-based Ghazanfar Bank for the acquisition of its Afghanistan operations.
Ghazanfar Bank is a licensed commercial bank in Afghanistan, established in 2009 by the Ghazanfar Group, one of the country’s major business conglomerates with interests in petroleum, gas, and multiple industrial sectors. The bank operates 15 branches across key Afghan cities and offers both conventional and Islamic banking services.
The transaction, once completed, would mark Bank Alfalah’s full exit from its long-running Afghanistan operations, subject to negotiated terms and regulatory scrutiny in both countries.
Bank Alfalah has been seeking to exit its Afghanistan operations for several years, but an earlier divestment attempt fell through when Da Afghanistan Bank rejected the acquisition proposal submitted by Azizi Bank in 2019. Both banks had reached an in-principle understanding to proceed with the transaction, but the deal could not move forward without regulatory consent.
Following the setback, Bank Alfalah signalled that it would consider alternative options, including engaging another potential buyer or continuing its Afghanistan operations for a limited period.
Bank Alfalah first entered the Afghan market in 2005 and operates branches in Kabul and Herat, offering both conventional and Islamic banking services. The bank has served as a key correspondent partner for Citibank NA for processing US Department of Defense payments within Afghanistan and is the only financial institution with a primary relationship with VISA. Its correspondent network includes global institutions such as Citibank (US), Commerzbank (Germany), Habib American Bank (US), and United National Bank (UK).