Day: November 20, 2021

The decision by the State Bank of Pakistan (SBP) to raise its benchmark interest rate by 150 basis points to 8.75 percent has been labeled “more than expected” by Bloomberg.

The publication said that all 41 analysts it surveyed expected an increase, however, the biggest increase predicted by analysts was 100 basis points. It said that the unexpected hike in interest rate is aimed at arresting increasing inflation and stemming the rupee’s slide.

SBP had slashed the benchmark interest rate by 625 basis points from March to June 2020 to 7% to counter the economic slowdown caused by the coronavirus pandemic.

In its monetary policy statement, the central bank said, “The MPC (Monetary Policy Committee) was of the view that there is now a need to proceed faster to normalize monetary policy to counter inflationary pressures and preserve stability with growth.”

“Looking ahead, the MPC reiterated that the end goal of mildly positive real interest rates remains unchanged, and given today’s move, expects to take measured steps to that end,” the statement added.

Bloomberg also noted that “the central bank has already taken multiple steps in recent months to ease domestic demand, including restricting consumer financing and raising cash reserve requirements for banks to absorb excess liquidity from the system.”

It is pertinent to mention here that SBP had brought forward the MPC meeting from the previously announced date of Nov 26 citing “recent unforeseen developments.”

Source: Pro Pakistani

Governor State Bank of Pakistan, Dr. Reza Baqir, chaired a meeting today with Director General FIA Sanaullah Abbasi to strengthen and coordinate efforts of SBP, banks and Federal Investigation Agency (FIA) to fight money laundering, cyber-attacks, and online frauds.

Governor SBP hosted Director General FIA and Banks’ Presidents to strengthen coordination against money laundering, digital frauds, and cyber-attacks, and the meeting was also attended by the Presidents of Banks and senior officers of FIA and SBP.

Governor SBP emphasized the need for close cooperation amongst banks, SBP, and FIA so those white-collar crimes are expeditiously investigated and fraudsters are apprehended and prosecuted.

SBP has taken several measures in the recent past to strengthen its work on Anti-money Laundering (AML) as well as taken regulatory and supervisory measures to improve banks’ controls to prevent digital and social engineering frauds.

In addition to better controls at the level of Financial Institutions and enhanced customers awareness, effective investigation and prosecution of criminals are needed to substantially reduce incidences of money laundering, digital frauds, and cyber-attacks.

The FIA team offered support in strengthening cyber security at banks and suggested banks carry out Information Security (IS) audits of their systems. Welcoming the suggestion, SBP informed that as per existing regulations, banks are required to regularly carry out their information system audit and penetration testing, however, it would be reemphasized to the industry through PBA.

The meeting identified key follow-up areas and associated timelines for strengthening cooperation between SBP, FIA, and banks in these areas.

Source: Pro Pakistani

The Federal Investigation Agency (FIA) has claimed that it has indelible evidence regarding direct involvement of Pakistan Muslim League Nawaz (PML-N) President Shehbaz Sharif and his son Hamza Shehbaz in money laundering operation of Sharif Group.

In a statement the FIA said that its team has been working to unwind the financial matrix in this complex case and has analyzed money-trail of over 17,000 credit transactions worth more than Rs. 16 billion into the secret bank accounts of peons and clerks of Sharif Group (Sharif Family) from 2008 to 2018.

“The team has found indelible and incontrovertible documentary evidence regarding the direct involvement of Shehbaz Sharif, then Chief Minister Punjab and Hamza Shehbaz in the affairs of Sharif Group which had been used as Sharif’s vehicle for money-laundering”, the FIA statement reads.

It further said that since both Shehbaz Sharif and Hamza Shehbaz were holding public office, as per law of the land, the father-son duo is accountable for the secretly acquired Rs. 16 billion in the names of their lower staff.

FIA also rejected the stance taken by Ataullah Tarar, the legal advisor to Shehbaz Sharif who had earlier claimed that the FIA has failed to collect evidence of corruption of even a single penny against Shehbaz Sharif and Hamza Shehbaz.

“The public position taken by Ataullah Tarar that FIA has failed to collect evidence of corruption of even a single penny is totally frivolous and an attempt to mislead the public-at-large and therefore rebutted”, said the statement.

Source: Pro Pakistani