KARACHI: The State Bank of Pakistan (SBP) clarified on Sunday the operations of KASB Bank are not suspended and the offices and branches of the bank will remain open as per their normal timings.
Following the advice of the SBP, the federal government on Friday placed KASB Bank under a moratorium for six months for failing to meet the central bank’s criterion for capital adequacy ratio.
The SBP has advised the bank to commence payments of up to Rs300,000 to its deposit account holders, with effect from November 17. Consequently, 92.3% of the bank’s depositors will be able to withdraw their total balances if they so desire while others will be able to withdraw up to the Rs300,000 limit.
Moreover, locker holders of the bank will be free to operate their lockers as usual, the SBP said. Borrowers of the bank will continue to make repayments of their dues as per already agreed upon terms and conditions, it added.
“The SBP would like to reassure the general public that the country’s banking sector is stable and strong. All other banks are operating in a normal manner and will continue to serve their customers as usual,” the statement said.
The total deposit base of all commercial banks is over Rs8.7 trillion. The percentage of KASB Bank’s deposits, however, is less than 0.7%, which reflects that the bank represents a ‘very small’ segment of the overall system.
Published in The Express Tribune, November 17th, 2014.
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