KARACHI: The State Bank of Pakistan (SBP) will have an excess of powers, if Banking Companies Ordinance 1962 aimed at regulating the banking system, is passed afresh with new amendments, Geo News reported Sunday.Addressing a media briefing here, the representatives of the foreign investors in banking system said the amendments proposed in Banking Companies Ordinance 1962 will end the protection of constitutional rights relating investment, property, trade and business, which will entail the central bank limitless powers; but, for any appeal against this, no modus operandi has been framed.
It should be mentioned that the central bank has been authorized to manipulate banks’ shareholdings, appoint administrators for unspecified time period and to cap it all, to take banks in its direct control.
The foreign investors said the judicial powers regarding the merger of financial institutions and the Securities and Exchange Commission of Pakistan’s powers on partnership have been delegated to the central bank.
The draft under discussion at the Senate enshrines the SBP’s right to change the Board of Directors of commercial banks, appoint administrators and transfer the officers.
This will give rise to central bank’s interference in banks at extreme low level and will lead to paralyze their managements.
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