Circulars/Notifications - Banking Policy & Regulations Department  
 BPRD Circular No. 05 of 2007
June 05, 2007 

The Presidents/Chief Executives
All Banks/DFIs

Dear Sirs / Madam,

MASTER CIRCULAR ON SECURITY STANDARDS FOR
ENHANCEMENT OF SECURITY OF THE LOCKERS

Please refer to BPD Circular No. 27 read with BPD Circular Letter No. 48 of 2004 on the above subject.

2. It has been brought to the knowledge of State Bank of Pakistan that some banks are reluctant to honour the claims with regard to vandalism of lockers by the security guards or by their employees. This is being attributed to a clause in their agreement with the insurance companies, which restrict them to honour such claims. This position has been reviewed and it has been decided to issue following instructions on the subject:-

i) The banks/DFIs shall ensure that safe deposit locker rooms in their respective branches are adequately secured from all sides, and the security arrangements in place are fool-proof and meet the security standards developed by each bank / DFI. The banks/DFIs may review their existing security arrangements to outsource the same to a security agency enlisted on the approved panel of Pakistan Banks Association (PBA). The banks may decide at their own to obtain or otherwise, any undertaking from the head of the security company for recovery of losses incurred on breakage of lockers by the security guards.

ii) In case the bank branches are providing safe deposit locker facility in areas where security agency on the PBA approved panel is not available, the bank/DFI shall carry out due diligence at the branch for the appointment of their own security guard(s).

iii) The banks/DFIs shall review their existing insurance agreements and shall obtain comprehensive insurance with clear cut “Cap Limits” on various sizes of lockers at competitive rates from the insurance companies ready to cover the act of vandalism of lockers both by the security guards and employees of the banks/DFIs.

iv) The banks/DFIs shall properly convey the terms & conditions (including size, rent/p.a, insurance ceiling etc) to the existing locker holders / new locker holders. Consent of all existing/new locker holders shall be obtained for the insurance ceiling etc.

v) In case of breakage /damage to the locker by any means, the locker holder shall be compensated by the bank/DFI immediately as per the insurance ceiling of the locker.

3. The banks/ DFIs are free to take further measures in addition to above for safety & security of lockers.

4. Apart from strengthening security arrangements, the banks/DFIs should also bolster/reinforce their internal controls for smooth operation of lockers.

5. This circular supersedes all previous instructions on the subject.

 

Yours truly,

Sd/-

(SYED IRFAN ALI)
Director

       
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