Banking Companies

Laws in Pakistan
 Banking Laws
• SBP Act 1956
• BCO 1962
• The Punjab Cooperative Societies and
Cooperative Banks (Repayment of Loans)
Ordinance 1966
• Banks Nationalization Act 1974Banks
Nationalization Act 1974 The Establishment
of the Federal Bank for Cooperatives and
Regulation of Cooperative Banking Act 1977
• Pakistan Banking and Finance Services
 Banking Laws
• The Corporate and Industrial Restructuring
Corporation Ordinance 2000
• Financial Institution (Recovery of Finances)
Ordinance 2001
• Anti-Money Laundering Act 2010
• SBP Banking Services Corporation Ordinance 2001
• Prudential Regulations for SMEs Financing
• Prudential Regulations for Consumer Financing
• Microfinance Institutions Ordinance 2001
• Prudential Regulations for Corporate/Commercial
 Laws

• BCO 1962
• SBP Act 1956
• Financial institution (Recovery of
Finances) Ordinance 2001
• Anti-Money Laundering Act 2010
 Banking Companies Ord. 1962
• Establishment & Management of Banking Co

• Applied in conjunction to Companies

Ordinance 1984

• Five parts

• 95 Sections
 Banking Companies Ord. 1962
• Section 8 “only banking business or its
derivative”
• Public Co.
• Ltd

• Section 87 right to use cheque for money

transfer
 Banking Business

• Section 7 forms of banking business (allowed)

• Section 9 forms of banking business (not

allowed)
 Capital & BOD
• Section 13 SBP requirement of paid up capital

• Section 14 Conditions for banking business

• BOD (Section 15; 15A; 15B & 15C)

• Tenure is 6 Years
 Reserves

• Section 21 creation of reserve fund from GP

• Section 22 reserve for:

– Time liabilities
– Demand liabilities
 Powers of SBP

– Section 25, 25A & 25AA authorization

– Section 26 prohibition of deposits

– Section 27 lenience for banking business & its

wind up

– Section 31 Unclaimed Deposits & valuables

– Section 34 Financial statements

 Powers of SBP

– Section 38 display of financial statements

– Section 41; 41A;41B; 41C Corrective

measures against banks

– Section 40 & 49 Periodic inspection of banks

 Amalgamation & Winding up of Bank

– Section 48 resolution recommended by 2/3

majority submitted to SBP

– Section 59 Voluntary winding up is not allowed

– Section 60-82 Legal & procedural mechanism/

framework for wind up
Banking Companies Ord. 1962
– Section 82A & 82D Banking Mohtasib

– Section 88 Change of name by banking Co.

– Section 89 Change in Memorandum of

Association