Circulars/Notifications - Banking Supervision Department  
 BSD Circular No. 4
January 31, 2001  

All Investment Banks notified under Section 3A
of  the Banking Companies Ordinance,1962.

Dear Sirs,



Your attention is invited to Section 3A of the Banking Companies Ordinance, 1962 as amended through the Banking Companies (Amendment) Ordinance, 2000 (copy enclosed). The amended law empowers the State Bank to determine minimum capital requirements for banks/NBFIs including Investment Banks.

2.         In exercise of powers vested under the provisions of above law it has been decided to prescribe Minimum Paid-up Capital Requirements for Investment Banks. Accordingly, all Investment Banks notified under Section 3A of the Banking Companies Ordinance, 1962 are directed as follows.

a)      Effective immediately no Investment Bank shall commence or carry on business unless it has a minimum paid up capital of Rs.500 million.

b)      If an Investment Bank is found short of the above mentioned minimum paid up capital requirement on the date of issuance of this circular, it shall meet 50% of the shortfall latest by 1st January, 2002 and the remaining 50% by 1st January, 2003.

3.         Investment Banks not meeting the minimum paid up capital requirement as set hereinabove shall be eligible to undertake only such kinds of business and transactions which will be specified by the SBP for a particular institution.

4.         Please acknowledge receipt.

Yours faithfully,
(Kazi Abdul Muktadir)
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