KARACHI:

The Pak Banker - - FRONT PAGE -

State Bank of Pak­istan (SBP) has set a min­i­mum au­tho­rized and paid-up cap­i­tal of Rs 20 mil­lion for set­ting up an Ex­change Com­pany (EC) of B Cat­e­gory al­low­ing them to have for­eign par­tic­i­pa­tion in their eq­uity up to 50%.

Ac­cord­ing to Ex­change Com­pany Man­u­als-2016 re­leased on Wed­nes­day, the cen­tral bank would per­mit ex­change com­pa­nies for repa­tri­a­tion of prof­its in pro­por­tion upto the ex­tent of for­eign eq­uity, how­ever these com­pa­nies should en­sure that the funds uti­lized for en­hance­ment of cap­i­tal of the com­pany are le­git­i­mate un­der re­lated laws. The cen­tral bank said that the af­fairs of the com­pany shall be run only with the de­clared cap­i­tal of the com­pany. Nei­ther the share­hold­ers and Di­rec­tors of the com­pany shall with­draw funds from the com­pany as loan nor shall they ex­tend loan (sub­or­di­nated loan) to the com­pany un­less spe­cific ap­proval, in writ­ing, from State Bank has been ob­tained. Prior ap­proval of State Bank re­gard­ing en­hance­ment of au­tho­rized and paid-up cap­i­tal by the ex­ist­ing Di­rec­tors/share­hold­ers will not be re­quired. The Ex­change Com­pany may di­rectly ap­proach Se­cu­ri­ties & Ex­change Com­mis­sion of Pak­istan (SECP) for ful­fill­ment of ap­pli­ca­ble for­mal­i­ties to in­crease its au­tho­rized or paid-up cap­i­tal.

A 25 per­cent of the Cap­i­tal shall be main­tained as Statu­tory Liq­uid­ity Re­serve (SLR) with the State Bank in the form of un­en­cum­bered ap­proved gov­ern­ment se­cu­ri­ties. State Bank would ex­tend cur­rent ac­count and SGLA fa­cil­i­ties to Ex­change Com­pa­nies. Ac­cord­ing to SBP, Ex­change Com­pa­nies are au­tho­rized to deal in for­eign cur­rency notes, coins, postal notes, money or­ders, bank drafts, trav­el­ers’ cheques, trans­fers and other busi­nesses. Com­pa­nies can buy and sell for­eign ex­change from/to in­di­vid­u­als in “Ready” value only whereas these can sell for­eign ex­change to in­cor­po­rated com­pa­nies for re­mit­tance on ac­count of roy­alty, Fran­chise, tech­ni­cal fee, re­pair and main­te­nance etc., af­ter ob­tain­ing ‘No Ob­jec­tion Cer­tifi­cate’ from the des­ig­nated Au­tho­rized Dealer.

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