March 22, 2024 (MLN): The State Bank of Pakistan (SBP) issued the no-objection certificate to The Bank of Punjab (PSX: BOP) on Friday for establishing an exchange company in the name of BOP Exchange Company (Private) Limited.
On October 28, 2023, the Board of Directors of BOP approved the establishment of an Exchange Company with an initial paid-up capital of up to Rs2.5 billion.
It is pertinent to note that the exchange company would be a wholly owned subsidiary of the bank.
This development comes after the SBP introduced reforms for the banks engaged in foreign exchange business to establish wholly owned Exchange Companies (ECs) to cater to the legitimate foreign exchange needs of the general public.
This action taken by the central bank comes in response to various regulatory issues that have been observed in the operations of ECs.
With this initiative, the SBP aims to consolidate and transform various types of ECs into a single category with a well-defined mandate.
