All Authorized Dealers in Foreign Exchange

Dear Sirs,

FOREIGN CURRENCY ACCOUNTS - FORWARD COVER FEE

Attention of the Authorized Dealers is invited to our Circular Letter No.23/FEP.16(326)-99 dated August 09, 1999 on the captioned subject. With a view to facilitate the banks in the present declining interest rate scenario, it has been decided to lower the rate of Forward Cover Fee on foreign currency deposits eligible to obtain exchange risk coverage from the State Bank. Accordingly, the revised fee for Forward Cover on these deposits with effect from July 05, 2003 will be as follows:

For U.S. Dollars	4.00% p.a
Pound Sterling	1.50% p.a
Euro	3.00% p.a
J. Yen	5.00% p.a