The Chief Executives,
All Banks / DFIs.

 

Dear Sirs / Madam,

 

CLARIFICATION- SBP GUIDELINES ON WRITE-OFF
OF IRRECOVERABLE LOANS AND ADVANCES

Please refer to BPD Circular No. 29 dated October 15, 2002 regarding captioned subject.

We have received some representations from the banks/DFIs requesting for an incentive on immediate repayment of settlement amount in lump sum instead of repayment in 3 years as stipulated in subject SBP guidelines. In this regard, it is clarified that banks/DFIs can provide some incentive to the eligible borrowers who are willing to immediately repay full settlement amount in lump sum, keeping in view net present value of future repayments (based on their respective average lending rates).
It may please be clearly understood that the above incentive provided to the borrowers will not, in any case, be reimbursed by SBP.

Please acknowledge receipt.