Circulars/Notifications - Banking Policy Department  
 BPD Circular No. 34
October 22, 2003

The Chief Executives,
All Banks.

Dear Sirs / Madam,


PRUDENTIAL REGULATION-XXI
Asset Management And Financial & Investment Advisory Services

Please refer to the instructions on the captioned subject as amended from time to time.

It has been decided to withdraw the captioned Prudential Regulation and allow commercial banks to establish subsidiaries for the purpose of Asset Management and Financial & Investment Advisory Services under the Non-Banking Finance Companies (Establishment and Regulation) Rules, 2003 notified by Federal Government vide S.R.O. 310(I)/2003 dated April 1, 2003.

However, commercial banks desirous of establishing a subsidiary for any activity mentioned in the Non-Banking Finance Companies (Establishment and Regulation) Rules, 2003 shall strictly observe the following guidelines:

(i) Banks desiring to set-up any NBFC under the NBFC Rules will do so through a separate subsidiary after obtaining prior approval from the State Bank of Pakistan.

(ii) The subsidiary to be set-up for the purpose shall be a public limited company.

(iii) The transactions undertaken / services provided by the subsidiary set-up under the NBFC Rules should not create any financial obligation, whether contingent or otherwise, on the balance sheet of the holding company or otherwise.

Please acknowledge receipt.

 


Yours faithfully,
(Muhammad Kamran Shehzad)
Director


BPD Circulars/ Circular Letters issued in 2002
       
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