Circulars/Notifications - Banking Supervision Department  
 BPRD Circular No.05
February 15, 2000  


 

All Scheduled Banks,

Dear Sirs,

FINANCING FACILITIES TO MODARABAS

Please refer to the instructions contained in BPRD Circular No.29 dated the 3rd September, 1996 in terms of which banks were directed to obtain prior clearance in writing from State Bank of Pakistan before granting financing facility (whether fund-based or non fund based) to Modarabas.

The matter has been reviewed and it has now been decided that banks shall no longer require prior clearance of State Bank of Pakistan, in respect of Modarbas having a credit rating of B-3 and above, while extending financing facilities to them (whether fund based or otherwise) provided the bank’s exposure is effectively secured and other Prudential Regulations and instructions issued by State Bank of Pakistan from time to time have been duly observed.

In other cases banks shall however, continue to seek prior clearance of State Bank of Pakistan in terms of instructions contained in BPRD Circular No.29 of 3rd September, 1996.

Please acknowledge receipt.


 
Yours faithfully,
(KAZI ABDUL MUKTADIR)
Director

       
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