Circulars/Notifications - Banking Policy & Regulations Department  
 BPRD Circular Letter No. 33 of 2008
November 13, 2008 

The Presidents / Chief Executives
Banks/DFIs



Dear Sir/ Madam,

PRICING OF LENDING PRODUCTS AND LOAN DOCUMENTATION

Please refer to BPRD Circular No. 12 dated August 1, 2007. 

It has been brought to the notice of State Bank of Pakistan that some of the banks/DFIs are misconstruing that instructions contained in the aforesaid Circular are applicable on consumer lending products only, which interpretation is not correct. It has been further observed that some of the banks/DFIs are not strictly following the instructions that the margin/spread over KIBOR fixed at the outset of the transactions cannot be increased by banks/DFIs during the tenure of the lending product. This practice has been viewed very seriously.

Banks/DFIs are clarified that instructions issued vide BPRD Circular No.12 of 2007 are applicable on all types of lending products including running finance and working capital loans. It is re-emphasized that the margin/spread over KIBOR once fixed at the outset of the transactions should not be increased by the banks/DFIs during the tenure of the lending product.

State Bank of Pakistan shall, during the course of on-site inspection, particularly check the compliance of the above instructions and necessary action against the delinquent banks/DFIs shall be taken under the relevant provisions of Banking Companies Ordinance 1962.

All other instructions on the subject shall remain unchanged.

Please acknowledge receipt.


Yours truly,

 Sd/-

(SYED IRFAN ALI)
Director


       
Home
About SBP
Publications
Economic Data
Press Releases
Circulars/Notifications
Laws & Regulations
Monetary Policy
Help Desk
SBP Videos
Feedback
Contact us
What's New?
Speeches
Online Tenders
Web Links

Educational Resources
Regulatory Returns
Library
Rupey ko Pehchano
Events
Zahid Husain Memorial Lecture
Careers
Sitemap
 
Best view Screen Resolution : 1024 * 768
Copyright © 2016. All Rights Reserved.