Circulars/Notifications - Banking Policy & Regulations Department  
 BPRD Circular No. 12 of 2016
September 30, 2016

The Presidents / Chief Executives
All Banks

Dear Sir / Madam


           Training and development are vital for progressive organizations. It is a fact that poorly trained employees can pose a serious operational risk and threat to very existence of banks. Therefore, banks need to pay due attention to training and development of their employees. Accordingly, in order to establish a continuous learning atmosphere and encourage the banks to enhance the overall capacity of their employees, banks are advised to implement the following specific parameters / guidelines:

Banks shall prepare a comprehensive training and development policy duly approved by their Board of Directors for all major functional areas, which should interalia cover processes related to Training Needs Assessment (TNA) and selection of employees for specific training programs.

The training and development budget shall specifically be made part of an overall budget document to be discussed and approved by the Board of Directors on annual basis. Further, the training and development budget may ideally be linked with overall size and complexity of operations of a bank or with certain percentage of administrative expenses.

Human Resources Committee of the Board shall specifically be assigned the responsibility of monitoring the utilization of training and development budget and implementation of approved training & development policy.

Specific areas of focus for training may be identified by banks before the start of each calendar year keeping in view the risks being faced by an individual bank. Further, trainings related to soft skills should also be considered for different levels of hierarchy.

The strategic / long term plans of a bank should also cover the desired improvements in the skill set of employees. In this regard, professional qualifications and function specific trainings should be given due weightages along with periodic targets.

Banks should develop training plans for employees posted at remote area branches so that they do not suffer in getting appropriate number of trainings during a year. Further, the banks may coordinate among themselves to utilize facilities of each other in remote areas.

Given the high rate of knowledge obsolescence, banks are expected to create a culture of learning in their organizations. Towards this end, banks may adopt e-learning methodology for capacity building of their employees and ensure that function specific trainings in critical areas such as AML / CFT, Forex, IT Operations etc., are available to all employees through intranet for learning purposes.

It would be encouraging if banks may explore new training channels like mobile based learning, webcasting, video conferencing, virtual classroom services etc. which will ultimately help banks to reach a wider range of employees.

Banks may explore the option of selecting internal employees as trainer or part-time faculty for providing adequate internal support to their training and development initiatives.

Banks shall maintain periodic MIS on trainings, which shall be reviewed by SBP inspection teams during on-site inspections. The MIS should be maintained at most granular level possible to allow performance evaluation, for example breakup of area-wise trainings, with further breakup of internal / external / local / international trainings along with number and tiers (senior, middle, lower) of employees trained in specific areas.

Banks may develop a suitable mechanism to assess the performance of employees after trainings. It may also help the banks to evaluate Return on Training Investment (ROTI) on regular intervals.


Banks should also encourage employees to obtain professional courses / certifications relevant to their job requirements by allowing reimbursement of fees, rise in salary or lump sum rewards etc. Trainings and certifications may also be linked with performance appraisals, promotions, or other benefits.

The coordination with Institute of Bankers Pakistan (IBP), National Institute of Banking & Finance (NIBAF), and local business management schools / universities may also be enhanced directly or through Pakistan Banks Association (PBA) forum to develop and design specific courses that cater to the specific needs of banking industry.

It is expected that banks shall revisit and align their training and development policy consistent with above mentioned parameters / guidelines on or before December 31, 2016. SBP shall assess compliance with above guidelines during the course of its regular on-site inspections of banks.

3. Please acknowledge receipt.

Yours truly,



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