Please refer to the BSD Circular No. 08 dated June 27, 2006 regarding implementation of Basel II in Pakistan.

2. State Bank of Pakistan has time and again advised the banks/DFIs to strengthen their risk management functions, adopt international standards and implement sound practices. In the same context, all the banks/DFIs are required to implement the Standardized Approaches of Basel II from January 01, 2008.

3. It has been decided that the transition to the Advanced Approaches of Basel II will be discretionary for all the banks/DFIs. However, the transition will be subject to prior written approval of the State Bank. It is clarified that only those institutions that plan to make a transition to the Advanced Approaches within the next five (5) years, are required to submit their Action Plans as required vide BSD Circular Letter No.02 dated April 29, 2008.

4. All other instructions on the subject shall remain unchanged.

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