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

Published: March 26, 2013
Has reason to believe Wathra may obstruct process of isolating loan defaulters. ILLUSTRATION: ANAM HALEEM

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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Reader Comments (17)

  • chacha
    Mar 26, 2013 - 1:11AM

    Clearly fault by governor state bank.


  • Bhatti
    Mar 26, 2013 - 1:27AM

    Uffff! I am having Goosebumps!! ECP u will bring change in Pakistan! u Rock!


  • Syed A. Mateen
    Mar 26, 2013 - 1:39AM

    Did the vacant position of Deputy Governor was advertise in all the leading daily newspapers?

    If no, than the recruitment of the Dy. Governor was illegal.


  • Blithe
    Mar 26, 2013 - 1:40AM

    Excellent to see the check being there.
    Thank you ECP!


  • Ayesha
    Mar 26, 2013 - 2:16AM

    Politically-motivated appointment every where, for example , for the 7 vacancies of additional district and session judges, after exams 4 months time ,today sindh high court has issued 7 interview letters in total !


  • SHB
    Mar 26, 2013 - 4:33AM

    If all the cousins are on the board meeting they can cook the books whichever way they want?


  • High and Dry
    Mar 26, 2013 - 4:48AM

    The same people who appointed Wathra have also appointed the DMD of Pak China and MD of Pak Oman. ECP should remove all such politically appointed persons who can create hurdles in the loans defaulters reporting.


  • Usman
    Mar 26, 2013 - 5:31AM

    Tip of the iceberg. ECP should investigate all appointments made by our esteemed PM in the last 3 months.


  • sehr.siddiqui
    Mar 26, 2013 - 6:11AM

    It will be shocking to know that National Bank has been not only sanctioning new bogus loans but rescheduling old stuck up loans in violation of prevailing regulations and accounting standards.The NBP , The SBP , The ICAP , The SECP are all party in jointly managing such write offsand loss to Government through connivance. This is a well coordinated game of these institutions and needs to be thoroughly investigated. A new new accounting terminology, “EXTINGUISHMENT OF LOAN” was created to hide the write offs. Please look into the printed accounts Sindh based sugar mills and you will know the story. Thanks to appointments made in NBP and SBP and ZTBL made through A. Majid and A. Karim. Ashraf Wathra’s appointment first in NBP and then to SBP was yet another scheme which was engineed by above named deal brokers. The SBP Governor being American national would not mind selling the country as he can simply take a flight like Hussain Haqqani and similar.
    ECP–well done.


  • f ahmed
    Mar 26, 2013 - 8:44AM

    building strong ,indepedent institutions ,like ECP,Supreme Court is making a difference.
    Doing the same in the case of SECP,CCP,KSE,Police,will
    see a sea of change in our overall enviornment.
    It is not enough to remove the Dep Gover, but to take
    action against those recommended him and to plug any loop holes that allow such appointments.


  • Saleem
    Mar 26, 2013 - 8:59AM

    Great! Let at top level appointments by last government in last month of their tenure be kicked out as well.


  • Usman
    Mar 26, 2013 - 9:04AM

    Tip of the ice berg. All appointments made by our esteemed PM in the last 3 months should be investigated and pronounced null and void.


  • Beatle
    Mar 26, 2013 - 9:30AM

    Let the concerned make it a binding law to prohibit any appointment or indulge in any agreement, local or foreign, in that last 6 months or so, of the out-going government. That may please the opponents of the time, who so ever and whenever it may be.


  • Mar 26, 2013 - 9:57AM

    This is another national shame. This is a big question on the moral credentials of the SBP governor and Wathra. SBP governor resign. Salams


  • Mar 26, 2013 - 11:18AM

    @sehr.siddiqi why are you including ICAP in this list? on what grounds? what role do you think ICAP plays in your conspiracy theory of covering up defaults of loans? while you’re at it, why not accuse PTDC, SCBA and KMC as well? after all, all you’re doing is picking up acronyms to accuse.


  • Asad
    Mar 27, 2013 - 10:36PM

    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.


  • Mar 27, 2013 - 10:38PM

    Proud to be a Pakistani


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