Politically-motivated appointment?: ECP directs removal of State Bank deputy governor

Has reason to believe Wathra may obstruct process of isolating loan defaulters.

Has reason to believe Wathra may obstruct process of isolating loan defaulters. ILLUSTRATION: ANAM HALEEM


The federal government has sought a reply from the governor of the State Bank of Pakistan (SBP), after the Election Commission of Pakistan (ECP) directed the immediate removal of SBP Deputy Governor Ashraf Mahmood Wathra, who had recently been appointed to the SBP board on his advice.

“The Finance ministry wrote to the SBP Governor on Monday asking him to provide comments within 48 hours, as the deputy governor was appointed on his recommendations,” finance ministry spokesperson Rana Assad Amin confirmed. He said the finance ministry has merely played the role of a post office in this regard, as the premier had appointed Wathra on the advice given by Anwar.

Amin said that Anwar had written to the finance ministry: while recommending Wathra’s appointment as deputy governor, Anwar had said he had interviewed Wathra and found him “fit and proper” for the post.

Former prime minister Raja Pervez Ashraf had appointed Wathra for a three-year period on March 5. Wathra was made head of the banking section and given the portfolio earlier handled by the other deputy governor, Kazi Abdul Muktadir.

Before Wathra’s appointment, the post had been vacant for almost a year due to the finance ministry’s reluctance in accepting the individuals nominated by the central bank for the post. Though the federal government has the authority to appoint deputy governors, the recommendations are traditionally made by the SBP governor.

Ashraf Mahmood Wathra is a banker and was serving as the senior executive vice president at National Bank of Pakistan, heading the Overseas Banking Group and the Americas region before his appointment as the SBP deputy governor.

However, the ECP fears that Wathra could obstruct the process of screening loan defaulters, which would allow such persons to contest general elections on May 11. NBP, the bank with which Wathra has been extensively associated with, has been in the news during the past five years on charges of sanctioning loans to individuals backed by ruling parties, allegedly without even securing collateral.

The Election Commission sprang into action on the matter following a petition filed in the Supreme Court of Pakistan by Dr Mubashir Hasan, a cofounder of the Pakistan Peoples Party. Dr Hasan has pleaded that the apex court empower the ECP, alleging in his petition that Wathra could obstruct the screening process.

SBP Governor Yaseen Anwar has been asked to explain his position on the matter within 48 hours, after a letter was sent by the ECP to Finance Secretary Abdul Khaliq, directing the removal of the deputy governor within two days.

SBP spokesman Syed Wasimuddin has said that the central bank has received the letter and replied accordingly, without giving any further details.

The finance ministry’s spokesperson said the ministry has sought two more days from the ECP, as it received the letter asking for the deputy governor’s removal on Monday. Amin said that the ECP’s directives will be implemented after the SBP governor’s response is received response.

If the caretaker prime minister decides to remove Wathra, it will be the first such removal of a high-profile functionary. Dozens of similar political appointments have been made by the former premier during the government’s last days in power.

Ashraf had also appointed Mahmood Mandviwalla, a first cousin of former finance minister Saleem Mandviwalla, as a director on the SBP board.

The SBP Act of 1956 is silent on the protocols of removing a deputy governor of the central bank. There is only one clause, but that too addresses the issue in case of a resignation given by the office holder. Clause 15 of the SBP Act states that: “The Governor, a Deputy Governor or a director may resign his office by statement to that effect in writing signed by him and addressed to the Federal Government [sic].”

Published in The Express Tribune, March 26th, 2013.

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Asad | 8 years ago | Reply

Proud to be a Pakistani

Asad | 8 years ago | Reply

Every journey begins with a first bold step. Feeling proud to see this good decision of ECP. I wish I can see the Quaid's Pakistan in my life.

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