Corporate Restructuring Companies

Corporate Restructuring Companies
Corporate Restructuring Companies Act, 2016

Corporate Restructuring Companies Rules, 2019
Corporate restructuring
Corporate restructuring is an action taken by the corporate entity to modify its capital structure, debt
structure or its operations significantly. Generally, when it is experiencing significant problems and is in
financial danger.
Characteristics of Corporate Restructuring
• Disposing of the unprofitable division from its core business to improve balance sheet.
• Rescheduling or refinancing of debt to minimise the interest payments.
• Changes in corporate management.
• Disposing of the underutilized assets.
• Outsourcing its operations to a more efficient 3rd party.
• Shifting of operations such as moving of manufacturing operations to lower-cost locations.
• Reorganizing functions such as marketing, sales, and distribution.
• Renegotiating labour contracts to reduce overhead.
• Conducting a public relations campaign at large to reposition the company with its consumers.
Types of Corporate Restructuring Strategies
• Merger
• Demerger
• Reverse Merger
• Disinvestment
• Takeover/Acquisition
• Joint Venture (JV)
Corporate Restructuring Action
Corporate restructuring action may be taken by company itself or by hiring advisors or through Corporate
Restructuring Companies (CRCs)
Business of CRC
• Acquisition, management, restructuring and resolution of non-performing assets of financial

institutions; and
• Restructuring, reorganization, revival and liquidation of commercially or financially distressed
companies and their businesses.
• Acting as recovery agents of financial institutions.
Incorporation of CRC
Eligibility criteria
Approval of Commission for incorporation
Incorporation as public limited company
License from Commission to commence business
Transfer of non-performing assets
Financial institutions transfer their non-performing assets to CRC or Trust constituted by CRC.
Pakistan Corporate Restructuring Company Limited
https://www.pcrcl.com.pk/
Given the present overall economic situation of the country, there was a dire need to take extraordinary
steps to expedite resolution of Non-Performing Assets of the Banks/FIs and make distressed companies
financially and operationally viable. To meet this end, Pakistan Corporate Restructuring Company Limited
(PCRCL), has been incorporated and licensed under the Corporate Restructuring Companies Act, 2016,
with a mandate to revive, restructure and rehabilitate the sick industrial units & businesses in Pakistan.
The Company has collectively been established by the top ten(10) Private Sector Banks of Pakistan namely
Allied Bank Limited, Bank Alfalah Limited, Bank Al Habib Limited, Faysal Bank Limited, Habib Bank Limited,
Habib Metropolitan Bank Limited, MCB Bank Limited, Meezan Bank Limited, National Bank of Pakistan and
United Bank Limited (collectively, the “Sponsors”).
Bank of Punjab (BOP) Signs MoU with
Pakistan Corporate Restructuring Company Limited (PCRCL)
Non-Performing Assets of the Banking Industry have persistently shown a rising trend over the last
several years and are a source of grave concern and a major stumbling block in the way of rapid economic
growth. These NPAs are expected to further augment in the wake of current economic meltdown, political
uncertainty and COV1D-19 Impact.
Therefore, given the present overall economic situation of the country, there is a dire need to take
extraordinary steps to expedite resolution of NPAs and make distressed companies financially and
operationally viable.
Bank of Punjab has decided to capitalize upon the opportunity of availing the specialized, non-
conventional Remedial Management expertise of Pakistan Corporate Restructuring Company Limited
(PCRCL) established under the CRC Act.
In this regard, the bank after conducting an exhaustive due diligence of its hardcore Non-Performing
Assets (NPAs), has signed a memorandum of understanding (MoU) with PCRCL for expeditious
resolution of its long standing NPAs, as well as to play its role in the revival of sick industries. The MoU
shall give the bank the First Mover’s advantage in the industry to utilize the services of PCRCL.
The MoU was formally signed in Lahore at BOP’s Head Office by Mr. Arslan M. Iqbal (Chief Risk Officer
– BOP) & Mr. Imran Butt (Chief Financial Officer – PCRCL). The signing ceremony was attended by
Mr. Zafar Masud (President & CEO – BOP) and Mr. Laqa Sarwar (CEO – PCRCL).
The bank is extremely excited to partner with PCRCL and believes that this would be a step in the right
direction to manage its non-performing portfolio as well as aid the industry at large for revival and
rehabilitation of ailing businesses.

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Corporate Restructuring Companies

Corporate Restructuring Companies Act, 2016

Characteristics of Corporate Restructuring

Types of Corporate Restructuring Strategies

Corporate Restructuring Action

• Acquisition, management, restructuring and resolution of non-performing assets of financial

Transfer of non-performing assets

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