NBP Act to be amended

Posted on 01.05.07 by StockPK Team @ 12:46 pm    

The State Bank of Pakistan (SBP) has planned to get the privatisation of state-owned National Bank of Pakistan completed after its corporatisation and major changes to the National Bank of Pakistan Act.

At present, 23.2 per cent shares in the bank are being traded on the three stock exchanges of the country. The federal government holds remaining shares in the bank.

The NBP, which is the only commercial bank of the country which enjoys sovereign guarantee of the government of Pakistan, was established in the 50s to finance the government’s commodity operations and handle accounts of state-controlled entities. In its latest financial sector review, the State Bank said it had been mandated to conduct the sale of another state-run bank, the Industrial Development Bank of Pakistan (IDBP).

The federal cabinet had approved restructuring and sale of IDBP in 2003, but the regulatory agencies took three years to take necessary decisions for the implementation of the decision.

The review also explained expected functions to be performed by Real Time Gross Settlement System of the central bank. The system will cover big payments in the inter-bank market whereby banks having accounts at the SBP will be able to operate their accounts in real time from their own premises via computer network.

The review said in that respect a complete online, real time banking solution - Globus - was being implemented which would provide a strong back-end system for SBP’s banking operations. Inter-bank lending and borrowing will be covered under the system.

The existing system is based on manual book-keeping, affecting the overall efficacy of the banking sector. The review said net balances of NIFT would also be directly settled in the RTGS system.

Source: The News