STAT BANK OF PAKISTAN

The State Bank of Pakistan (SBP) is incorporated under the State Bank of Pakistan Act,
1956, which gives the Bank the authority to function as the central bank of the country.
The SBP Act mandates the Bank to regulate the monetary and credit system of Pakistan
and to foster its growth in the best national interest with a view to securing monetary
stability and fuller utilization of the country’s productive resources.

Rules and Regulations of SBP

Economic Reforms
This Act, may be called the Protection of Economic Reforms Act, 1992.
(2) It extends to the whole of Pakistan.
(3) It shall come into force at once.
• Act to override other laws
• Freedom to bring, hold, sell and take out foreign currency
• Immunities to foreign currency accounts.

Preliminary
This Ordinance may be called the SBP
Banking Services Corporation Ordinance, 2001.
(2) It shall come into force at once.
In this Ordinance, unless there is anything repugnant in the subject
or context.
a. “Act” means the State Bank of Pakistan Act, 1956 (XXXIII of 1956)
b. “Bank” means the SBP Banking Services Corporation established under
section 3.
c. “Board” means the Board of Directors of the Bank.
d. “Chairman” means the Chairman of the Board.
e. “Committee of Directors” means a Committee of Directors constituted
under section11.

Establishment and operation of the bank.

As from the date of
promulgation of this Ordinance, there shall be established, a bank to be called
SBP Banking Services Corporation.
• The Bank shall be a body corporate having perpetual succession and a seal
and shall, by the name assigned to it by sub-section (1), sue and be sued.
• The head office of the Bank shall be situated in Karachi and it may
establish branch, offices and agencies in Pakistan and anywhere outside
Pakistan with the prior approval, in writing, of the State Bank.

Authorization to deal in foreign exchange.

i. In terms of the powers vested in it by section 3 (1) & 3 (2) of the Foreign
Exchange Regulation Act, 1947 (the Act), the State Bank may, on application,
authorize any person to deal in foreign exchange. The State Bank may authorize
dealings in all foreign currencies or may restrict dealings in specified foreign
currencies only. Further, it may authorize transactions of all descriptions in
foreign currencies or may restrict to specified transactions only.
ii. The license to deal in approved foreign exchange transactions of all descriptions is
issued to scheduled banks.

Credit bureaus Licensing Criteria

“Licensing criteria for setting up Credit Bureaus in Pakistan” have been framed in terms
of power conferred upon SBP under Section 4 of the CBA, 2015. The document sets forth
minimum requirements and application procedure for establishment of a credit bureau in
private sector. SBP may amend the licensing requirements, as and when deemed
appropriate.
The terms mentioned in this document shall have the same meaning as defined in Credit
Bureaus Act, 2015 and Credit Bureaus Regulations.
• Policy considerations
• Eligibility Criteria
• Licensing Procedure
• Validity of the License
• Revocation or Suspension of a License

Incorporate changes:
The government is all set to incorporate changes to State Bank of Pakistan (SBP) rules
and regulations through the SBP (amendment) Bill 2020 meant to ensure the autonomy of
Central Bank to promote collegial decision making in the bank to address the conflict-of-
interest issues, well informed sources told Business Recorder.
According to the proposed amendments, the authorized capital of the Bank shall be of Rs
500 billion divided into five billion shares of one hundred rupees each. The authorized
capital may be increased by the resolution of the BoD subject to the consent of the federal
government.
The proposed amendment says that the bank "shall" not extend any direct credits to or
guarantee any obligations of the federal government, any sub -national government, any
government owned entity. The prohibition laid down in sub-section (1) "shall" not apply
to government owned or publicly-owned banks and other regulated entities, which shall
be given the same treatment as privately owned banks. The bank shall purchase securities
issued by the federal government, any sub-national governments, any government-owned
entity or any other public entity on the primary market. The bank may purchase such
securities in the secondary market.
SECRURITIES AND EXCHANGE COMMISSION OF PAKISTAN
Securities and Exchange Commission of Pakistan (SECP) established under the
Securities and Exchange Commission of Pakistan Act 1997 was operationalized as a
body Corporate on 1st January 1999. SECP replaced Corporate Law Authority, the
former corporate regulatory body. It has been vested with adequate operational,
administrative and financial autonomy.
• Company Law Division
• Securities Market Division
• Specialized Companies Division
• Finance & Admin Division
• HR& Training Division
• Insurance Division
• Information System & Technology Division

Rules and Regulations of SECP

In the Insurance Rules, 2017:
1. In rule 8, for the words and number “Rs. 2.00 per thousand of gross direct premium”
the words and number “Rs. 1.60 per thousand of gross direct premium” shall be
substituted.
2. In rule 39:
(a) In sub-rule (4), for the words “rupees one hundred thousand”, the words “rupees fifty
thousand” shall be substituted; and
(b) Sub-rule (5) shall be substituted as follows:
“(5) An application for renewal of authorization to act as an insurance broker shall be
submitted to the Commission at least one month prior to the expiry of the licence and
shall also be accompanied by a renewal fee of rupees thirty-seven thousand five
hundred or rupees one for every rupee one thousand of the gross revenue, without
netting off any expenses, whichever is higher during the preceding financial year,
subject to a maximum of rupees two hundred and fifty thousand.”

Preliminary:
1. Short title and commencement. - (1) These rules shall be called the Securities
and Exchange Commission of Pakistan (Search and Seizure) Rules, 2019.
(2) They shall come into force at once.
2. Definitions. (1) In these rules, unless there is anything repugnant in the subject
or context-
(a) “Act” means the Securities and Exchange Commission of Pakistan Act, 1997
(XLII of 1997);
(b) “electronic evidence” includes the information or data obtained during
investigation that is stored on, received or transmitted by an electronic
device

Draft Amendments:
In the aforesaid Regulations, -
(1) in regulation 6, -
(i) existing sub-regulation will be numbered as (1);
(ii) clause (iv) of aforesaid sub-regulation (1) shall be omitted;
(iii) in clause (v) of sub-regulation (1), for the words “preference
shareholders and the Commission”, the words “holders of such shares
carrying differential rights” shall be substituted.
(iv) after sub-regulation (1), re-numbered as aforesaid, the following sub regulation (2)
shall be inserted, namely
“(2) Notwithstanding the requirements of sub-regulation (1), a company
may convert its ordinary shares into preference shares or convert its
shares (of a particular kind) from one class to another, on the basis of a
special resolution:
Provided that the rights of holders of such converted shares are
provided for in the articles of association of a company:
Provided further that a share that is not a redeemable preference
share when issued cannot afterwards be converted into redeemable
preference share.”