Money and banking drive economic activity by facilitating transactions, savings, and investments. Banks manage financial resources, offer credit, and regulate money supply, ensuring stability and growth in Pakistan’s financial sector.
KARACHI: The Pak Rupee ended firmer against the dollar on Friday amid demand for import and corporate payments, dealers said.
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KARACHI: State Bank of Pakistan (SBP) has issued instructions for opening accounts for raising funds through donations / contributions for Prime Minister’s Ehsaas Koye Bhooka Na Soye initiative.
The SBP said that the Finance Division, Government of Pakistan, had notified establishment of the subject Fund under the Prime Minister’s Ehsaas Koye Bhooka Na Soye initiative, to eliminate hunger in the country by providing meals to the people in need, especially those at risk of, or experiencing hunger.
In this regard, the State Bank of Pakistan (SBP) is pleased to announce opening of “Ehsaas: Koye Bhooka Na Soye (EKBNS) Fund Account-2021”, for raising funds through donations/contributions from general public to support the above initiative. All the commercial banks and field office of SBP Banking Services Corporation shall open the account of the Fund and shall receive donations/contributions in cash, through cheques, and through Alternate Delivery Channels (ADCs), at all their branches across the country.
Donors shall be provided multiple options for making donation/contribution to the Fund as described below:-
a. Counters of the banks
All commercial banks in Pakistan and field offices of SBP Banking Services Corporation shall collect donations at their counters across their branch network in Pakistan. The donors may deposit their donations at any branch of the above banks. The daily donation/contribution collected by the commercial shall be settled on aggregate basis with the SBP, through Pakistan Real-time Settlement System (PRISM) via MT-103.
b. Crossed Cheques Drop Box Facility
Due to COVID-19 pandemic situation, banks shall also make available at their branches, the drop box facility enabling the donors to drop crossed cheques in the name of the fund. The banks shall, accordingly debit the customer’s account and transfer the proceeds to the Fund’s account at SBP through PRISM. The banks are advised to ensure that the drop box facility is fully operational and prominent notices or banners are placed in all such branches that the donors can drop the crossed cheques in the name of the Fund.
c. Alternate Delivery Channels ( ADCs)
The banks shall allow their respective customers to make donations/contributions through internet banking, Automatic Teller Machines (ATM) and other Alternate Delivery Channels (ADC). For the purpose, commercial banks shall prominently display the IBAN of the Fund at their websites and ATMs screens and send the same to their clients through SMS alerts. The amount collected through ADCs shall be settled with SBP through PRISM on aggregate basis, once in a day.
The banks shall keep the detail files of settlement of donations collected through mechanism specified in a, b and c above (i.e. name of donor and amount of his/her donation/contribution) in their record for subsequent verification and reference.
KARACHI: The Pak Rupee ended flat against the dollar on Thursday owing to lower demand for import and corporate payments.
The rupee closed at Rs152.83 to the dollar from the same closing of April 13, 2021 in the interbank foreign exchange market.
The banks were remained closed on April 14, 2021 for the Zakat deduction on first day of Ramazan ul Mubarak.
The currency analysts said that the rupee likely to make gains in coming days due to better foreign exchange reserves, improved export receipts and workers’ remittances and external situation.
KARACHI: The National Assembly likely to adopt amendments to State Bank of Pakistan (SBP) Act by September 2021.
This was assured by the Pakistani authorities to International Monetary Fund (IMF).
The ministry of finance submitted the amendments to parliament in March 2021 and the authorities expect adoption by parliament by end-September 2021.
The authorities assured the IMF about making good progress toward strengthening the SBP’s autonomy, governance, and mandate.
The authorities said: “We have worked closely with IMF staff in the preparation of amendments to the SBP Act to address existing gaps.”
The amendments aim to:
(i) establish domestic price stability as the primary objective, with financial stability and growth as secondary objectives;
(ii) clearly define the SBP’s functions to help achieve these objectives;
(iii) strengthen the SBP’s financial autonomy, including through statutory mechanisms for sufficient recapitalization and profit retention; (iv) prohibit the extension of direct credits or guarantees to the general government;
(v) establish the statutory underpinnings for audits;
(vi) secure stronger protection of the personal autonomy of senior officials;
(vii) further strengthen collegial decision making at the executive management level;
(viii) provide stronger oversight by the Board; and
(ix) improve SBP’s accountability regarding the conduct of its monetary policy and the achievement of its objectives.
KARACHI: Foreign investors have recommended that corporate tax rates for the banking sector should be aligned with other sectors.
At present the banking sector is paying 35 percent corporate tax rate as compared with 29 percent corporate tax rate for other sectors.
Overseas Investors Chamber of Commerce and Industry (OICCI) in its proposals for budget 2021/2022 submitted to the Federal Board of Revenue (FBR) recommended that corporate tax rates for the banking sector should be aligned with other sectors.
Further super tax relief, as granted to other industries, should be given to banking sector as well.
Regarding the issue of Tax Deduction on Profit on Debt under section 151 of Income Tax Ordinance, 2001, the OICCI recommended that there should be a uniform withholding tax rate of 15 percent for all payments of profit on debt by omitting below provision inserted through Finance Act, 2020:
“Provided that the rate shall be 10 percent in cases where the taxpayer furnishes a certificate to the payer of profit that during the tax year yield or profit paid is rupees five hundred thousand rupees or less”, and Circular be withdrawn, to avoid litigation between banks and department.
For enhanced rate of tax on Additional income from additional investment in Federal Government Securities (Rule 6C of Seventh Schedule), the OICCI recommended Rule 6C of seventh schedule of Income Tax Ordinance, 2001 should be deleted whereby enhanced rate of 37.5 percent is applied on banks income from additional investment in Federal Government Securities.
According to Rules for person not appearing in Active Taxpayer List (Section 100BA and Tenth Schedule) if a withholding tax agent is satisfied that a person not appearing in Active Taxpayers List (ATL) is not required to file return, then before deducting tax he will furnish to the Commissioner a notice carrying particulars of taxpayer along with reason on the basis of which it is considered that the person is not required to file a return.
The OICCI recommended to delete the rule as branch managers are not conversant with tax laws. Alternatively, if FBR is satisfied that a person is not required to file return of income, his CNIC/Name should be included in an Exempt Taxpayer List (Similar to ATL) which should be issued periodically.
The original provision of the Seventh Schedule should be restored where provision for bad debts as per the Prudential Regulations of SBP and supported by an Auditors certificate was allowable as a tax deduction to the banks. Alternatively, threshold for allowing provision for bad debts should be increased to 2 percent of gross advances to corporate customers.
The rule 9 of the Seventh Schedule of ITO 2001 should be deleted as it is being misused and leading to unnecessary litigation.
KARACHI: The Pak Rupee fell by eight paisas against the dollar on Tuesday owing to bank holiday a day ahead that may create pressure on import payment demand.
The rupee ended Rs152.83 to the dollar from previous day’s closing of Rs152.75 in the interbank foreign exchange market.
Currency experts said that the rupee witnessed a decline due to higher dollar demand for import and corporate payment as banks likely close on Wednesday due to Zakat deduction on the first day of Ramazan ul Mubarak.
The currency experts said that the rupee may continue to gain value in coming days owing to substantial increase in inflows of workers remittances and export receipts.
KARACHI: The State Bank of Pakistan (SBP) on Monday issued bank office and business hours during Ramazan-ul-Mubarak 1442 A. H..
The SBP said that the SBP will observe the following office hours during the month of Ramazan-ul-Mubarak, which will also be followed by all bank, Development Financial Institutions and Microfinance Banks.
The bank office timings shall be 10:00 am to 4:00 pm (with prayer break from 2:00 pm to 2:15 pm) during Monday to Thursday.
On Fridays the bank office shall be from 10:00 am to 1:00 pm (without break).
The banking hours for public dealings shall be:
The banks shall observe banking hours from Monday to Thursday between 10:00am to 1:30 pm (without break). The banking hours on Friday shall be from 10:00 am to 1:00 pm (without break).
However, except Friday, banks / MFBs may observe extended business (banking) hours for public dealing from 10:00 a.m. to 3:00 p.m. (with 15 minutes prayer break) at their branches situated in major cities / business centers / commercial markets & hubs / ports etc.
KARACHI: The Pak Rupee gained 19 paisas to close Rs152.75 against the dollar on Monday owing to lower demand for import payment.
The rupee maintained gaining momentum against the dollar. The rupee was closed last Friday at Rs152.94 to the dollar in the interbank foreign exchange market.
Currency experts said that due to high number of cases reported daily the importers were caution in placing orders to their foreign suppliers.
The rupee also posted an strengthened due to strong growth in inflows of workers’ remittances.
The inflow of workers’ remittances has registered 26 percent growth to $21.47 billion during first nine months (July – March) 2020/2021, State Bank of Pakistan (SBP) said on Monday.
The inflow of remittances was $17 billion during the same period of the last fiscal year.
The SBP said that workers’ remittances extended their unprecedented streak of above $2 billion for the 10th consecutive month in March 2021.
Remittances rose to $2.7 billion in March 2021, 20 percent higher than last month and 43 percent higher than March 2020.
Cumulatively during July-Mar FY 21, remittances have risen to $21.5 billion, up by 26 percent over the same period of FY20.
KARACHI: Banks shall remain closed on the first day of Ramaza-ul-Mubarak 1442 A. H. for deduction of Zakat.
The Stat Bank of Pakistan (SBP) in a notification issued on Monday said that SBP will remain closed for public dealing on 1st Ramadan-ul-Mubarak, 1442 A.H., which shall be observed as “Bank Holiday” for the purpose of deduction of Zakat.
All banks / DFIs / MFBs shall, therefore, remain closed for public dealing on 1st Ramadan-ul-Mubarak, 1442 A.H. However, all employees of the banks / DFIs / MFBs will attend to their official assignments (in-office or work-from-home, as designated under the current COVID-19 situation) on Bank Holiday treating it as a normal working day (except for public dealing).
KARACHI: Securities and Exchange Commission of Pakistan (SECP) has identified false trading by Sindh Bank Limited (SBL) and warned the bank against such activities in future.
The SECP said that with reference to correspondence exchanged between SECP and the bank regarding various trades carried out by SBL in ready market during the period from January 2020 till January 2021 in the shares of several companies.
“Upon detailed review of trading data, it was observed that large quantum of trades carried out by SBL during the aforesaid period in ready market was matched with the proprietary accounts of brokerage houses through with it was trading.
“In the said transactions, SBL first sold and then on the next day bought those shares back of approximately same quantity and at either the same rate or slightly higher rate, wherein, counterparty on buy and sell trades was proprietary account of the same brokerage house.”
The SECP said that the aforementioned pattern of trading as explained above may lead to false trading which is not in the interest of investors trading in the securities market. Therefore, representatives of SBL were called for a meeting to explain the rationale for carrying out such trades in ready market, wherein, they explained that such transactions were called out only for the purpose of realization of gain/loss in the securities held by the SBL.
The pattern of trading adopted by the SBL may be detrimental for a fair and transparent trading in ready market where trading volumes in listed companies are generated based upon genuine demand and supply mechanism.
The SECP prohibited the bank from engaging in the said pattern of trading in the ready market or any other such arrangements which may affect the integrity of stock market.
The SECP also warned all securities brokers of facilitating such transactions in the ready market.