SECP grants certificate of incorporation to Meezan Exchange
Company (Ltd.)
Meezan Exchange Company (Pvt) Limited has successfully
obtained its certificate of incorporation from the Securities and Exchange
Commission of Pakistan (SECP), marking a significant milestone in its
establishment as a wholly owned subsidiary of Meezan Bank. The company is set
to provide services such as currency exchange, remittances, and related
activities in adherence to Shariah principles.
Meezan Bank, in a recent filing with the Pakistan Stock
Exchange (PSX), revealed that the board approved the establishment of the
exchange company in September 2023, with a paid-up capital of Rs 1 billion.
Following this, the bank secured a no-objection certificate (
NOC) from the
State Bank of Pakistan (SBP).
Meezan
Bank to establish exchange company with Rs. 1 billion capital
The next step for Meezan Bank involves applying to the SBP for
the necessary license to initiate operations for the exchange company, as
outlined in the SBP Exchange Companies Manual. The bank anticipates launching
the exchange company in the near future, offering customers a convenient and
Shariah-compliant platform for their foreign exchange needs.
The development aligns with recent structural reforms
introduced by the State Bank of Pakistan (SBP) in the exchange companies
sector. These reforms aim to strengthen control over the open market, enhance
governance, internal controls, and compliance standards. As part of the
initiative, both public and private banks engaged in foreign exchange
activities are required to establish wholly owned Exchange Companies,
addressing the legitimate foreign exchange requirements of the public.
Banks
involved in foreign exchange activities to establish wholly-owned exchange
companies
The SBP has raised the minimum capital requirement for
exchange companies from Rs 200 million to Rs 500 million, with the condition
that the capital must be unencumbered by prior losses. In compliance with these
regulations, major banks, including Meezan Bank, United Bank Limited (UBL), MCB
Bank Limited (MCB), Bank AL Habib (BAHL), Allied Bank Limited (ABL), Faysal
Bank Limited (FABL), Bank Alfalah (BAFL), Habib Metropolitan Bank, Askari Bank
Limited, Bank of Punjab, and Bank of Khyber, have announced plans to establish
their own forex companies.
Notably, the SBP has issued a no-objection certificate (NOC)
to Allied Bank Limited (ABL) and MCB Bank Limited (MCB) for the establishment
of their exchange companies. It's worth mentioning that Habib Bank Limited
(HBL) and the National Bank of Pakistan (NBP) ventured into exchange companies
prior to the implementation of these new SBP regulatory measures.
Source: Profit Pakistan