Bank Alfalah received State Bank of Pakistan (SBP) approval for a planned Tier II capital issuance of up to PKR 20 billion, then announced on July 9, 2026, that it had raised the full amount through an AAA-rated Tier 2 Term Finance Certificate (TFC). The approval was not the final transaction: the bank’s later announcement confirmed completion.
What SBP approved—and what Bank Alfalah later completed
Approval-stage coverage published by Finance.PK on June 18, 2026, reported that the SBP had authorized Bank Alfalah to raise up to PKR 20 billion in redeemable capital under Section 66 of the Companies Act, 2017, and the SBP’s Basel III guidelines. The proposed instrument was a TFC, which could be privately placed and/or listed, subject to documentation and applicable requirements. Finance.PK’s approval report describes the proposed authorization; the bank’s later announcement establishes the completed issuance.
On July 9, 2026, Bank Alfalah announced that it had successfully raised PKR 20 billion through a Tier 2 TFC. The bank said the issuance was made under Basel III and was AAA-rated. It described the deal as Pakistan’s largest TFC issuance in the banking industry and its first AAA-rated TFC; those size and first-of-its-kind descriptions are the bank’s claims. Bank Alfalah’s newsroom carried the completion announcement.
When the money was received
The bank’s half-year results provide a separate timeline for the receipts. As of June 30, 2026, Bank Alfalah reported PKR 18.045 billion in advance against subscription money. It said it received the remaining PKR 1.955 billion after the half-year period ended. The bank announced that it had raised the full PKR 20 billion on July 9. Bank Alfalah’s half-year results were published July 30, 2026.
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The same results reported a capital adequacy ratio of 17.4% as of June 30, 2026. That figure is a point-in-time measure for the half-year end; it should not be read as a ratio calculated after the bank received the final PKR 1.955 billion or completed the issuance.
What a Tier 2 TFC means
A Term Finance Certificate is a debt instrument. In this case, Bank Alfalah described the TFC as Tier 2 regulatory capital issued under Basel III. Tier 2 capital is a category of a bank’s regulatory capital; it is distinct from ordinary shares and is subject to regulatory eligibility rules. It can strengthen a bank’s capital position without representing a deposit account or an ordinary equity purchase.
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The available announcements do not state the TFC’s coupon, tenor, redemption schedule, investor allocation or final listing status. The approval-stage report said private placement and/or listing were possible routes, but that description does not establish which route was ultimately used. The AAA rating reported by the bank is not a substitute for those terms or a guarantee that investors cannot lose money.
Independent reader supportYour contribution helps us test, update, and keep practical guides available for everyone.What Bank Alfalah says the capital will support
Bank Alfalah said the Tier 2 issuance would complement its growth capital and support its growth strategy, particularly in small and medium-sized enterprises (SMEs), environmental, social and governance (ESG) initiatives, and consumer banking. This is the bank’s stated strategic purpose; the announcement does not say that proceeds are legally ring-fenced for those areas.
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