SBP extends Export Finance Facility to August

SBP has announced that limits sanctioned by banks for individual exporters will continue up to August 31.

KARACHI: The State Bank of Pakistan (SBP) has announced that limits sanctioned by banks for individual exporters under Part-II of the Export Finance Scheme for 2009-10 will continue up to August 31.

The move would enable the exporters to continue getting financing facilities till the preparation of statements, their verification and submission to the refinance units of the SBP Banking Services Corporation, said the SBP in a circular on Wednesday.

Under the rules, the SBP said, export refinance limits for the year 2009-10 were due to expire on June 30. Besides, the exporters were required to submit EE-1 statement, verified by the SBP’s Foreign Exchange Operations Department, by August 31.

As a result, banks would not have been in a position to work out revised entitlement of refinance limits for the exporters for next financial year 2010-11, it said.

The SBP said the refinancing facility is self-regulating and the exporters should be able to evaluate correctly their export earnings during 2009-10, work out estimates as to the quantum of their entitlement for the year 2010-11 and should accordingly adjust their existing borrowings on or before the end of June.

The SBP asked banks to submit requests for limits under the Export Finance Scheme and Islamic Export Refinance Scheme for 2010-11 by June 25.

LTFF limit extended

In another circular, the SBP announced that Long-term Financing Facility (LTFF) limits for banks, which were due to expire on June 30, would remain continue for the time being.

This, the SBP said, has been done to ensure that financing facilities are available to borrowers till the finalisation of new limits for 2010-11.

Published in the Express Tribune, June 17^th, 2010.