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Mar 06 - 12, 2000

  1. International
  2. Finance
  3. Industry
  4. Policy
  5. Trade
  6. Gulf

Credit rating

Pakistan Credit Rating Agency has upgraded the long-term rating of First International Investment Bank Ltd (Interbank) to single 'A'.

Its short term rating has been maintained at A1, says a press release issued here on Thursday. It adds that these ratings, which apply to the senior unsecured creditors of the bank, represent high credit quality and the capacity for timely payment of the financial commitments.

Acting SECP chief

Tariq Iqbal, Commissioner (Securities), has taken charge as acting Chairman of the Securities & Exchange Commission of Pakistan (SECP) following retirement of Shamim Ahmed Khan.

Khan was the founder-Chairman of SECP after its inception on January 1, 1999. Prior to that he was Chairman of Corporate Law Authority (CLA) which ceased to exist with the coming into being of SECP. Under the SECP Act, the Chairman and Commissioners are appointed by the Government for an initial term of three years which is of course extendable.

World Bank to fund gas authority

The World Bank has agreed on the possibility of providing $500,000 loan jointly to the Ministry of Petroleum and Law Division for the establishment and implementation of Gas Regulatory Authority (GRA), official sources told.

The institutional development finance (IDF) loan, which will equally be distributed between the Ministry of Petroleum and the Law Division and will be utilised for developing policy cell and institutional development.

The idea of providing $ 500,000 IDF loan was started after Petroleum Minister Usman Amin-ud-Din requested the bank for assistance in this regard.

SBP to issue guidelines for banks

The State Bank may issue certain guidelines to all the banks to cut their cost of financial intermediation.

"The SBP may come out with guidelines for the banks aimed at reducing their cost of financial intermediation," said a source close to SBP.

Other sources at SBP said the central bank is busy compiling data relating to cost of financial intermediation of all banks. They said senior SBP officials would analyse the historical data to see how banking sector reforms had helped banks in reducing their cost of financial intermediation.

Govt may enact law to help lenders' take-over

The government may consider drafting a law for empowering financial institutions to take over nonperforming listed companies. The number of such companies has risen to 300.

This issue came up for discussion in a meeting called by Securities and Exchange Commission of Pakistan (SECAP) of experts and stake-holders for soliciting their views on draft regulations for 'substantial acquisition of shares and takeover' regulations, 2000.

The representatives of the commission assured the participants that government would consider enacting such a law which would strengthen financial institutions in taking over of nonperforming listed companies.

The participants representing Karachi Stock Exchange (KSE), Overseas Chamber of Commerce and Industry (OCCI), Institute of Chartered Accountants and Management of Pakistan (ICAMP), Institute of Cost Management Accountants of Pakistan (ICMAP) and FPCCI stressed upon the need for securing the interest of small stake-holders in the process of taking over nonperforming companies.

The participants were informed that out of 300 listed (nonperforming) companies only 15 have been revived.

On the assertion by a participant that 90 per cent of textile members of All Pakistan Textile Mills Association (APTMA) — as of last year — remained non-performing companies, experts suggested that such rules and regulations must be made to provide complete checks and balances to monitor imprudent practices behind acquisition of shares.

Free trade policy on cotton likely to go

The federal government has decided to give up its four years' old free trade policy for cotton from next picking season.

The government will procure the crop by fixing its support price like other crops under its new policy expected to be announced by the chief executive next month.

Meanwhile, the agriculture ministry also expects to achieve farm growth rate of 4 per cent against 0.35 per cent last year. These disclosures were made by the four senior officials cotton commissioner Dr Zakir Hussain, two senior joint secretaries Rashid Mahmood Ansari and Abdul Rauf Malik and agriculture development commissioner Mohammad Hanif.

SBP governor to strengthen banking sector

The Governor, State Bank of Pakistan (SBP), Dr. Ishrat Hussain, vowed to do his best towards strengthening the banking sector in the country.

He was speaking as chief guest at a luncheon hosted by the Karachi Bankers Club (KBC) at a local hotel.

The function was organized to welcome Dr. Ishrat Hussain, Zakir Hussain and Amar Zafar, Presidents HBL and UBL respectively and to bid farewell to former State Bank Governor Dr. Muhammad Yaqub and ex-Presidents of HBL and UBL, Shaukat Tarin and Zubyr Soomro respectively.

Dr. Ishrat called for concerted efforts to achieve the aim, in an atmosphere of global competition.

Japan to raise social sector aid by 10-15pc

With the last disbursement to the Pakistani NGOs under the grass roots assistance programme for the year 1999-2000, the Japanese officials announced to raise the social sector aid to Pakistan by 10-15 per cent next year.

"We hope to extend 10 to 15 per cent more than what has been disbursed this year" Nakagawa, head of the economic section at the Japanese embassy, told reporters after signing ceremony of extension of 0.43 million dollars to the social sector NGOs here at a hotel.

Japanese Ambassador Minoru Kobuta signed the agreements with 12 NGOs extending aid to assist them in the implementation of their projects in the fields of education, health and vocational training sectors.