Prudential Regulation-XX issued vide BPRD Circular No.28 dated
the 18th August, 1996 is substituted by the following:-
1. In terms of Section 41 of the Banking
Companies Ordinance, 1962, all banks and Development Finance
Institutions are directed to strictly observe the following
rules in the matter of making any donations/contributions
for charitable, social, educational or public welfare purposes.
i.
Only those banks which meet provisioning and capital adequacy
requirements prescribed by the State Bank of Pakistan and
pay positive rates of return to their depositors can make
donations.
ii. Every
donation or contribution to be made must carry the prior approval
of the Board of Directors.
2. All
donations or contributions to be made during the year must
be specifically approved by the shareholders in their Annual
General Meeting.
3. Banks/DFIs are further directed to expressly
disclose in the Annual Accounts the total donation/contribution
made during the year alongwith names of donees, to whom total
donations/contribution during the year were made in excess
of Rs,100,000/- In the case of donations where any director
or his spouse has interest in the donee, the names of such
directors, their interest in the donee and the names and address
of all donees, shall also be given.
4. The auditors of the banks shall also report
whether the bank has complied with all the above requirements
in their report to the State Bank in accordance with the guidelines
given in BID Circular No.5 dated the 19th December, 1972 and
subsequent amendments thereto.
5. Each bank/DFI shall furnish the State
Bank with a statement for each financial year indicating the
names of persons and the amount of donation/contribution made
to each donee during the year within 30 days of the close
of the financial year. This statement must be accompanied
with a certificate signed by the chief executive that the
bank has met with all the requirements set out by State Bank
for making donations/contributions.
Please acknowledge receipt.
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