April 22, 2024 (MLN): The Securities & Exchange Commission of Pakistan (SECP) has issued the Certificate of Incorporation to "BOP Exchange (Private) Limited", a fully owned subsidiary of The Bank of Punjab (PSX: BOP), the bank's filing on PSX revealed.
This development follows the issuance of the no-objection certificate from the State Bank of Pakistan on March 22, 2024.
As a next step in the process, application will now be submitted to SBP for issuance of license to commence operations, as per the SBP Exchange Companies Manual.
To recall 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.
