ISLAMABAD: Federal Board of Revenue (FBR) has drafted rules to empower customs officials to trace and freeze assets acquire by any person through proceeds of smuggling.
(more…)Day: November 20, 2020
-
SBP announces incentives for banks to finance low cost housing
KARACHI: The State Bank of Pakistan (SBP) on Friday amended regulations to incentivize banks for financing low cost and affordable housing.
A statement said that the central bank is constantly providing enabling regulatory environment to promote housing and construction finance.
This is an important sector that has significant economic linkages with other sectors in the economy and the current level of credit provision in this sector is at a very low level of less than 1 percent of GDP which is much lower than in other similar countries and in the region.
To support the provision of finance to this sector and especially facilitate affordable housing, SBP has now announced five regulatory relaxations to incentivize banks for financing low cost and affordable housing.
Firstly, the definition of low cost housing finance used in the current regulations for banks has been aligned with definition used under Government Markup Subsidy Facility for Housing Finance eligible under Tiers I & II of housing finance.
Specifically, in the SBP regulations, the value of housing unit has been increased from Rs 3 million to Rs 3.5 million with maximum loan size increased from Rs 2.7 million to Rs 3.15 million. Consequently, the incentive for low cost housing finance will increase for banks as they will not only be able to enjoy markup subsidy facility by the Government but the regulatory incentives under low cost housing finance by SBP as well.
Current regulations and banking practices require banks to obtain documentary evidence of income. Provision of this information is difficult for people generating income from informal sources which are generally in low income segments.
In order to facilitate financing for this segment, State Bank is urging the banks to use alternate methods to identify income sources and assess the credit worthiness of the borrower.
The 2nd and 3rd type of relaxations are being given to facilitate financing for this segment. Accordingly, under 2nd relaxation, banks have been exempted from the requirement of using ‘verifiable income’ for the purpose of calculating Debt Burden Ratio (DBR) in case of low cost housing finance where banks are using income proxies and where income of borrower is not verifiable.
Resultantly, borrowers with ‘non-verifiable income,’ estimatedby banks using income proxies, will also become eligible to avail low cost housing finance.
Thirdly, banks have also been exempted from the requirement of observing DBR, in case of low cost housing finance, where banks are using repayment surrogates like rent, utility bills, telcos bills, etc. to assess repayment capacity of borrower. Hence, borrowers without verifiable or non-verifiable income will become eligible to avail low cost housing finance.
Fourthly, banks have been exempted from the requirement of Internal Credit Risk Rating System for the low cost housing finance till September 30, 2022 as their current systems do not specifically cater for low cost housing finance.
Accordingly, borrowers of low cost housing finance who cannot avail financing due to banks internal credit rating criteria will now become eligible if the bank is otherwise satisfied. This time barred relaxation will provide banks to develop their Internal Credit Risk Rating Systems for low cost housing finance.
Finally, in order to provide comfort to the borrowers who have liquid securities or already have a housing unit, banks have been allowed to extend housing finance for purchase/construction of a residential property by accepting existing residential property or liquid securities in lieu of equity contribution for housing finance at the time of calculations of Loan to Value ratio.
Financing bank will create its lien on existing residential property/liquid securities in addition to mortgage of residential property being financed.
It is expected that the above regulatory incentives would provide further impetus to SBP’s on-going efforts to accelerate housing and construction finance in Pakistan. It is reminded that banks have already been given mandatory targets of 5 percent of their private sector advances as housing and construction finance by December 31, 2021.
-
FBR gets details of buyers, sellers of immovable properties
The Federal Board of Revenue (FBR) is employing a comprehensive approach to enhance tax compliance by obtaining crucial information on buyers and sellers of immovable properties through provincial registrars.
(more…) -
ECC approves $150 million for COVID vaccine purchase
ISLAMABAD: The Economic Coordination Committee (ECC) of the Cabinet on Friday approved an amount of $150 million for the purchase of the COVID-19 vaccine.
Adviser to the Prime Minister on Finance and Revenue Dr. Abdul Hafeez Shaikh chaired the meeting of the Economic Coordination Committee of the Cabinet here at Islamabad.
Minister for Industries and Production Hammad Azhar, Minister for Economic Affairs Khusro Bakhtiar, Adviser to the PM on Institutional Reforms and Austerity Ishrat Hussain, SAPM on Petroleum Nadeem Babar and SAPM on Revenue Dr. Waqar Masood, also participated in the meeting.
The ECC evaluated a proposal submitted by the Ministry of National Health Services, Regulations & Coordination and approved, in principle, the provision of technical supplementary grant of $150 million for the purchase of the COVID-19 vaccine.
Ministry of Health briefed the ECC that this shall be the first phase of procurement and the amount of vaccine will suffice for the most vulnerable 5 percent of the population i.e. the health workers and the population above the age of 65 years; around 10 million people would be provided a vaccine cover under the above arrangement.
The ECC further directed the Ministry of National Health Services to discuss the proposal with WB and other donors in coordination with Economic Affairs Division so that they could assist in providing financial facility for the procurement of the vaccine during the first phase and for the procurement of additional quantities in future as needed.
The forum also directed the Ministry of NHS to draw a holistic proposal regarding the pricing and risk mitigation mechanism for the procurement of the COVID-19 vaccine for provision on a wider scale, in consultation with the relevant stake holders.
The ECC approved the request of the Economic Affairs Division to proceed with the formal request for availing the G-20 Debt Relief for the extended period i.e January-June 2021; approval of the Federal Cabinet would be required for signing of the bilateral debt service suspension agreements.
The ECC also approved two technical supplementary grants for “Initiating the Process of Retrenchment of Pakistan Steel Mills Employees (PSM)” for an amount of Rs.19.656 billion and “Prime Minister’s Special Package to Implement SKILLS FOR ALL Strategy as Catalyst for TVET Sector Development in Pakistan for Rs. 500 million.
Another Rs. 689.3 million were also approved as budget re-appropriation for National Information Technology Board (NITB) for fulfilling its various requirements during the meeting. ECC also approved the proposal by the Ministry of Energy/ Petroleum Division for the allocation of 2.25 MMCFD gas from Umair -1 to M/s OGDCL for sale to M/s Engro at a mutually agreed and negotiated price, under a Gas Sale and Purchase Agreement subject to initiation of Field Development Plan and Development and Production Lease.
The ECC was also briefed on the status of wheat import through Trade Corporation of Pakistan. Ministry of National Food Security and Research briefed the forum on the provision of additional 340,000 MT of Wheat, a tender was floated on 11-10-2020; the bids were opened on 18-10-2020 and lowest bid was accepted. The total quantity to be imported is now 2.248 MMT.
-
Stock market sheds 354 points ahead MPS announcement
KARACHI: The stock market fell by 354 points on Friday owing to imposition of smart lockdown and schedule announcement of monetary policy statement (MPS).
The benchmark KSE-100 Index of Pakistan Stock Exchange (PSX) closed at 40,187 points as against 40,541 points showing a decline of 354 points.
Analysts at Arif Habib Limited said that the market took negative turn today by dipping down 414 points during the day and closed -354 points.
MoC saw selling pressure building up in banks and cements, for reasons that next week is roll-over, government has imposed smart lock down in areas where corona incidence is on the increase and State Bank of Pakistan (SBP) is due to announce monetary policy on Monday eve.
E&P stocks bit the dust as well, although international crude oil prices were up and trading positive. Among scrips, UNITY topped the volumes with 39.7 million shares, followed by TRG (14.2 million) and MLCF (10.1 million).
Sectors contributing to the performance include Banks (-91 points), Cement (-63 points), Inv Banks (-52 points), Technology (-38 points) and O&GMCs (-30 points).
Volumes increased to 189.9 million shares as against 188.5 million shares (+0 percent DoD). Average traded value however declined by 4 percent to reach US$ 47.1 million as against US$ 50 million (-6 percent DoD).
Stocks that contributed significantly to the volumes include UNITY, TRG, MLCF, EPCL and WTL, which formed 41 percent of total volumes.
Stocks that contributed positively to the index include ILP (+7 points), MTL (+5 points), UNITY (+4 points), NML (+4 points) and PMPK (+4 points). Stocks that contributed negatively include DAWH (-51 points), UBL (-29 points), LUCK (-26 points), TRG (-23 points) and BAFL (-18 points).
-
Rupee ends down by 11 paisas on foreign payment demand
The Pakistani Rupee faced a modest decline of 11 paisas against the US dollar on Friday, closing at Rs160.73 in the interbank foreign exchange market.
(more…) -
FBR issues rules for centralized payment of income tax refunds
ISLAMABAD: The Federal Board of Revenue (FBR) on Friday announced the issuance of draft rules for the centralized payment of income tax refunds. The FBR released SRO 1239(I)/2020, proposing amendments to the Income Tax Rules, 2002, aimed at streamlining the refund process and enhancing transparency.
(more…) -
MTO Karachi appoints focal person to facilitate construction sector
KARACHI: Medium Taxpayers Office (MTO) Karachi has appointed a focal person to facilitate construction industry for availing special incentive package announced by the prime minister.
(more…) -
Zhiping Rong resigns as shareholder director of PSX
KARACHI: Zhiping Rong has resigned as shareholder director of Pakistan Stock Exchange (PSX), according to a statement issued on Friday.
Zhiping Rong was representing China Financial Future Exchange on the board of PSX. He resigned with effect from November 18, 2020.
The PSX said that the resignation had also vacated the office of You Hang, as an Alternate Director for Rong on the board of the exchange.
-
FBR invites services for real-time monitoring, tracking of cargo movement
ISLAMABAD: Federal Board of Revenue (FBR) has invited Expression of Interest (EOI) from companies providing real-time support for monitoring and tracking of transit / transshipment of goods.
(more…)