Circulars/Notifications - Offsite Supervision & Enforcement Department  
 OSED Circular No. 05 of 2015
June 01, 2015 

The President/Managing Director/CEOs,
All Microfinance Banks (MFBs)


Dear Sir/Madam,

Finalization of Inspection Reports

Please refer to OSED Circular No. 02 dated February 27, 2015 on the subject.

In view of the feedback received from MFBs, the procedure and instructions for refund of penalty imposed in respect of violations booked in the State Bank’s inspection report contained in the above referred Circular are revised as under:

i). Banks/DFIs should provide timely information/evidence/record demanded by inspection team in connection with any irregularity/observation noted in the draft inspection report. SBP will not consider any evidence presented by the bank/DFI to contest any observation(s) in the final meeting held at SBP to finalize the inspection report if it is found that the bank/DFI had deliberately and/or negligently withheld such evidence at any stage during inspection process.

ii). MFBs shall make appeal only against the penalty imposed on specific instances/annexure/appendices where the MFB can substantiate its claim with sufficient documentary evidence. Any record/evidence produced before Off-Site Supervision and Enforcement Department (OSED) to support the appeal, which was not presented earlier to Banking Inspection Department during the inspection process, shall not be entertained.

iii). Any request for refund of penalty should be filed with OSED within maximum 120 days of the date of realization of penalty amount by SBP. Any appeal filed subsequently will be deemed time barred thus shall not be considered.

iv). An appeal for refund of penalty against a specific penalty advice can only be made once.

v). The MFB filing an appeal shall pay Rs. 100,000/- as Processing Fee for the appeal so made. The Processing Fee will be payable upfront by the bank/DFI through RTGS to SBP’s Account No. 427514 “Payable Penalty Refund Processing Fee”. The bank/DFI must mention the RTGS transaction reference in its appeal letter addressed to the Director, OSED. The bank/DFIs should write the following standard message while making payment of Processing Fee:

“Processing Fee for penalty refund on XYZ bank/DFI’s IR as of (date format DD: MM: YY).”

The MFBs which are not the direct participants of the RTGS may either make the payment through a direct participant (preferably) or by a pay order in favor of SBP.

If any amount of penalty contested is found tenable, the Processing Fee will be refunded along with the amount of penalty refundable so determined to the concerned MFB.

This Circular supersedes OSED Circular No. 03 dated February 27, 2015.

Please acknowledge receipt.

 

Yours sincerely,

(Lubna Farooq Malik)
Director

       
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