STATUTORY CASH RESERVE
In terms of Section36(1) SBP Act, 1956, every scheduled bank is required to maintain with State Bank a balance the amount of which shall not at the close of business or any day be less than such percentage of Time & Demand Liabilities in Pakistan as may be determined by State Bank.
Presently the requirement is 5% on weekly average basis subject to daily minimum of 4% of Time & Demand Liabilities (reference BPRD Circular No.27 dated 2nd July,1999).
STATUTORY LIQUIDITY REQUIREMENT
In terms of Section 29(1) of Banking Companies Ordinance, 1962 every banking company shall maintain in Pakistan in cash, gold or un-encumbered approved securities valued at price not exceeding "the lower of cost or the current market price" an amount which shall not at the close of business in any day be less than such percentage of the total of its time & demand liabilities in Pakistan, as may be notified by State Bank from time to time.
Presently the requirement is 15% (excluding 5% statutory cash reserve) of the total of its time and demand liabilities in Pakistan (BPRD Circular No.26 dated 2nd July, 1999).
MAINTENANCE OF LIQUIDITY AGANINST CERTAIN LIABILITIES
In terms of Rule 6 of NBFIs Rules of Business, all NBFIs are required to invest 14% of their liabilities defined in the Rule, in Government Securities, NIT Units, shares of listed companies or listed debt securities in the prescribed manner. For the purpose of this rule, liabilities shall not include NBFIs equity, borrowings from financial institutions including accruals thereon, lease key money, deferred taxation not payable within 12 months, dividend payable within two months, advance lease rentals and deposits from financial institutions. In addition, they are also required to maintain cash balance with State Bank, which shall not be less than 1% of their liabilities as defined above.
SUBMISSION OF ANNUAL AUDITED ACCOUNTS BY NBFIs
Under Rule 17 of NBFIs Rule of Business, all NBFIs are required to invest to submit their annual audited accounts within a period of 6 months after the close of their accounting year.
At the expiration of each calendar year every banking company incorporated in Pakistan, in respect of all business transacted by it, and every banking company incorporated outside Pakistan, in respect of all business transited through its branches in Pakistan, shall prepare with reference to that year a balance-sheet and profit and loss account as on the last woking day of the year in the prescribed forms(Section 34 of Banking Companies Ordinance, 1962).
SUBMISSION OF RETURNS.
The accounts and balance-sheet referred to in section 34 together with the auditors report as passed in the annual General Meeting shall be published in the prescribed manner, and three copies thereof shall be furnished as returns to the State Bank within three months of the close of the period to which they relate (Section 36 of Banking Companies Ordinance, 1962).
MINIMUM CAPITAL REQUIREMENTS
In terms of Section 13 of Banking Companies Ordinance, 1962 no banking company shall commence business unless it has a minimum paid up capital as may be determined by the State Bank or carry on business unless the aggregate of its capital and unencumbered general reserves is of such minimum value within such period as may be determined and notified by the State Bank from time to time for banking companies in general or for a banking company in particular.
As present, all banks operating in Pakistan are required to maintain capital and unhecumbered general reserve, the value of which is not less than 8% of their risk weighted assets. Additionally they are also required to maintain a minimum paid up capital of Rs.500 million.