UPDATED F.E. CIRCULAR
Date 2nd April,1992 |
F.E Circular No.36 |
All Authorized Dealers in
Foreign Exchange
Dear Sirs,
MOBILIZATION OF FOREIGN CURRENCY
DEPOSITS BY THE INVESTMENT BANKS
It has been
decided to allow the Investment Banks to raise foreign currency funds from abroad through
issue of Certificates of Investment, which shall bear maturity of not less than 3 months.
The foreign exchange so raised will be required to be surrendered immediately to State
Bank of Pakistan. In this connection, following instructions will be followed:-
The Certificates will be registered.
The Certificates will be denominated in US
$, �. Stg, Deutsche Mark and Japanese Yen.
The rate of profit will be indicated on
the face of the Certificates and will not exceed the rate of interest applicable to
similar deposits received by commercial banks under the Foreign Currency Accounts Scheme.
The foreign currency amounts representing
sale proceeds of the Certificates will be surrendered in State Bank of Pakistans
following accounts on the same day on which the same are received by them:-
a) US.$ Account maintained with Federal
Reserve Bank,New York.
b) �.Stg Account maintained with Bank of
England.
c) D.M. Account maintained with National
Bank of Pakistan, Frankfurt.
d) J.Yen Account maintained with National
Bank of Pakistan, Tokyo.
Simultaneously with the surrender of
foreign currency amounts, the Investment Bank will provide the details of the amount
surrendered, period for which the deposit has been taken, interest rate, and amount of
interest to the Chief Manager, State Bank of Pakistan, Karachi/Lahore. The concerned Chief
Manager will pass on rupee equivalent of the amount surrendered to the Investment Bank and
will also book forward cover for the amount surrendered plus profit covering the period of
deposit.
Upon maturity of the Certificates, the
Investment Bank will make remittances of the amounts of principal/profit by repurchasing
the relevant amounts from State Bank of Pakistan at the same exchange rate at which the
rupee equivalent was paid by the State Bank of Pakistan at the time of surrender of
foreign currency.
In the case of premature encashment no
interest shall be paid.
2. As mentioned in Para-1
above, State Bank of Pakistan will pass on rupee equivalent of the amount surrendered on
the basis of Investment Banks letter. In case of delayed surrender of the amount,
State Bank of Pakistan will recover penalty @ Rs.4.00 per Rs.10,000/- per day from the
Investment Bank. |