Bank Islami Pakistan, the second-largest full-fledged Islamic bank in Pakistan, has received regulatory approval to study the acquisition of KASB Bank. Bank Islami’s board of directors approved a plan to raise Rs 3.5 billion ($34.8 million) via subordinated Islamic bonds to fund its expansion strategy. An acquisition could see Karachi-based Bank Islami add 105 branches to its existing network of 213. The transaction would require the conversion of KASB Bank’s conventional financial products into sharia-compliant ones. In November 2014, the central bank placed KASB Bank under a six-month moratorium as it struggled to meet capital adequacy requirements. In May, Karachi-based Meezan Bank received central bank approval to buy the local banking business of HSBC, while Summit Bank and Faysal Bank have plans to convert into full-fledged Islamic lenders in the next two to three years. There are five full-fledged Islamic banks in Pakistan as well as 14 Islamic windows, a practice which allows conventional lenders to offer Islamic financial services.