State Bank revises branch licensing policy

Karachi –– State Bank of Pakistan SBP on April 11, 2011 said that Branch Licensing Policy BLPs has been revised with immediate effect.

A SBP circular said in order to provide incentive to commercial banks for enhancing outreach of Islamic banking services, it has been decided to enhance scope of Rural/ Underserved Areas RUAs definition. Henceforth, any district having less than 10 Islamic Banking Branches IBBs will be termed as underserved with respect to Islamic banking facilities. Consequently, first 10 IBBs in such districts of Pakistan will fall under BLPs definition of RUAs.

SBP said in each calendar year, only one IBB of a particular bank will be eligible to be treated as RUA in any particular district. This means, if some bank desires to open more than one IBBs in any particular district, then its first IBB will be treated as RUA branch and any subsequent number of branch(es) would be considered as normal branch(es).”

These instructions will be effective immediately and respective banks are allowed to approach SBP within one month of issuance of this circular for change/ replacement of RUA locations (if desires so) with respect to new criteria. All other instructions on the subject shall remain unchanged, circular said.

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