Please refer to BSD Circular No.19 dated September 05, 2008 on the above subject.

2. In view of the general global slowdown in growth and capital accumulation by financial institutions and representations from shareholders, the minimum Paid up Capital (free of losses) requirements for banks have been revised. Now the banks are required to raise their paid up capital (free of losses) as per the following timeframe:

	Minimum Paid up Capital (free of losses)	Timeframe
1	Rs 6 billion	31.12.2009
2	Rs 7 billion	31.12.2010
3	Rs 8 billion	31.12.2011
4	Rs 9 billion	31.12.2012
5	Rs 10 billion	31.12.2013

 

3. While capital adequacy standards will continue as previously and all banks/DFIs shall be required to increase CAR to 10% w.e.f. December 31, 2009 irrespective of their CAMELS-S rating, till further instructions.

4. Branches of foreign banks (FBs) operating in Pakistan are also required to raise their assigned capital (net of losses) to Rs. 10 billion within the above prescribed timelines. However, those foreign banks whose Head Offices hold Paid up capital (free of losses) of at least equivalent to US$ 300 million and have a CAR of at least 8% or minimum prescribed by their home regulator, whichever is higher, will be allowed with prior approval of the State Bank to maintain assigned capital as under:

a. FBs operating with upto 5 branches are required to raise their assigned capital to Rs. 3 billion latest by 31st December 2010.

b. FBs operating/desirous of operating with 6 to 50 branches are required to raise their assigned capital to Rs. 6 billion latest by 31st December 2010.

5. All other instructions, on the subject, shall remain the same.

Please acknowledge receipt.