In order to promote good corporate governance and to encourage President/Chief Executive and Board of Directors to play an effective role for the capacity building of their institution certain guidelines under “Fit & Proper Test” have been formulated for the appointment of President/Chief Executive and filling of the vacancy of Director on the Board. While applying to SBP for obtaining prior clearance in terms of BPRD Circular No. 12 dated 2^nd June, 2000, the financial institution should ensure that guidelines given under “Fit & Proper Test” (Annexure-I) have been complied with. The “Fit and Proper Test” guidelines are practiced & implemented by regulators globally. 

2.         In addition to submission of requisite information about appointment of proposed President/Chief Executive and Directors of Board, information in a simple proforma (enclosed at Annexure-II) shall also be provided by the bank/NBFI for obtaining necessary clearance from other institutions, if any. This proforma will replace the one notified vide BSD Circular Letter No. 32/2000 dated 23^rd November, 2000. The Circular Letter dated 23^rd November, 2000 shall stand withdrawn with immediate effect. 

3.         The institution not meeting the Fit & Proper Test in respect of their President/Chief Executive and Board of Directors may regularize the position within 120 days from the date of issuance of this circular.

Encl: As above