CCP approves UBL’s acquisition of Wall Street Exchange assets

Islamabad, July 5, 2024: As part of its efforts to transform the cross-border remittance and foreign exchange market in Pakistan, the Competition Commission of Pakistan (CCP) has approved the acquisition of certain assets of Wall Street Exchange Company (WSE) by UBL Currency Exchange (UCE).

The approved transaction involves UCE, a recently formed subsidiary of United Bank Limited, acquiring certain assets from WSE. These assets include real estate, employee contracts, commercial contracts and essential operating resources such as computer equipment, equipment and vehicles.

Focus on evaluating your competition

Before granting approval, CCP conducted a thorough competitive assessment in Phase I. This assessment identified “Foreign Exchange and Money Transfer” as the relevant market segment. While CCP confirmed that WSE had distinct market shares in this segment, the Commission noted that UCE would be a substantially new entity and the market share data would not be directly applicable following the acquisition. This strategic move by UBL to expand its presence in the foreign exchange market is expected to create a more competitive environment and provide better services to consumers.

Regulatory alignment and public benefits

The CCP stressed that the merger is in line with the regulatory mandate of the State Bank of Pakistan (SBP) to strengthen the foreign exchange sector and maintain exchange rate stability. The CCP believes that this consolidation will promote a balanced approach, ensuring market competitiveness while safeguarding market integrity. By combining the resources and expertise of UBL and WSE, the merger is expected to streamline operations, improve service quality and potentially lead to more favourable exchange rates for customers.

Expected benefits for consumers

CCP anticipates that this approval will increase public access to basic financial services related to international and domestic remittances. This, in turn, is expected to better meet the legitimate needs of the general public for currency exchange. It is anticipated that the consolidation will facilitate smoother and more efficient remittance processes, benefiting not only individual consumers but also businesses that rely on international transactions. In addition, the merger is likely to lead to technological advances and improved infrastructure in the currency exchange sector.

The acquisition, once completed, is poised to bring significant changes to the remittance and currency exchange landscape in Pakistan. While WSE’s existing market presence will be integrated with UCE’s operations, the impact on competition and consumer experience will be visible in the coming months. Stakeholders and market observers are closely watching how this development will impact market dynamics, with particular interest in how it will impact service availability, pricing and overall market health. CCP’s move is seen as a step towards modernizing and strengthening the financial services sector in Pakistan, which will ultimately contribute to the country’s economic growth and stability.