Please refer to BPD Circular No. 10 dated 29th March, 2003 on the captioned subject.

Instances have been noted where some of the banks are issuing Term Deposit Receipts (TDRs) or similar instruments without complying with the requirement of “Know Your Customer (KYC)” issued vide aforesaid Prudential Regulation. This practice tantamounts to bypassing the instructions issued on the subject.

In order to discourage this practice, banks/DFIs are advised to fully comply with the requirements of Prudential Regulation No. XI, while issuing the TDRs or similar instruments. Moreover, if the TDRs, or similar instruments, are issued in the name of a third party, due diligence must be conducted as per aforesaid regulation.

Non-compliance of above instructions will attract penal provision under the Banking Companies Ordinance, 1962

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