Islami Bank Bangladesh is taking foreign investment of about Tk245 crore to expand its service scope in the mobile financial services (MFS) sector.
The strategic investment in the bank's subsidiary 'mCash' will be made by US-based investment firm B100 Holdings.
Islami Bank informed investors about this information through the Dhaka Stock Exchange (DSE) on Monday (March 9).
Earlier, the decision to take foreign investment was approved at the meeting of the bank's board of directors held on Sunday.
According to the bank's information, B100 Holdings will invest a foreign currency equivalent of about Tk244.95 crore in 'mCash'. In return for this investment, the company will be given a maximum of 48.99% shares of mCash.
According to the policy of Bangladesh Bank, at least 51% ownership in a mobile financial services company must be held by a commercial bank. Islami Bank will retain majority ownership in mCash in accordance with that rule.
The bank said that the new investment will increase mCash's paid-up capital to Tk500 crore.
According to Islami Bank, the foreign investment will not only expand the scope of mobile banking services, but also strengthen the liquidity situation of the institution.
However, to implement the investment, approval from mCash's board of directors, notification to regulatory agencies and completion of necessary legal procedures will be required.
Islami Bank launched 'mCash' as a mobile banking service in December 2012.
Although it was operated under the bank's own infrastructure for a long time, it started its journey as a separate subsidiary company in January this year.
Currently, mCash has an authorized capital of Tk100 crore and a paid-up capital of Tk50 crore.
Those concerned believe that the capital structure of the institution will be further strengthened if new foreign investment is added.