SBP's NPLs have reduced: Ishrat

State Bank Governor Dr Ishrat Hussain has said that non-performing loans of the central bank had reduced drastically after achieving autonomous status in 1997.
He said prior to 1997, non-performing loans were 25 percent of the total lending, adding it was reduced to five percent after 1997, and in the last four years those were only 2.5 percent.
Dr Ishrat said the SBP had been playing its role very efficiently. Five years ago, average daily rate was 21 percent, which was now five percent. That was because of its better regulatory role, he added.
He was speaking at the Saarc Chamber of Commerce and Industry (SCCI) seminar on "The challenges of economic governance in developing markets."
Dr Ishrat said that Pakistan should focus on five-key areas to improve its socio-economic condition - accountability and media liberalisation, political stability, government effectiveness, role of regulatory bodies, and rule of the law.
He said the governments of Nawaz Sharif, Musharraf and Jamali neither interfere in the banking system, nor they encroach upon the liberty of the central bank. Use of political gains could also harm the overall efficiency, he maintained.
Moreover, rule of law must be maintained in any country and corruption should also be taken care of, he added.
Dr Ishrat said the need of 22 licenses for setting up a business should be done away with, as it hindered the investors from investing here.
He said there should be formal and informal institutions, which could help develop society and increase efficiency, adding informal institutions were like trust and confidence among the society.
Formal institutions included state, civil society, independent judiciary, parliamentary and public accounts committees and others.
All these factors should work hand-in-hand efficiently to form a balanced society.
The SBP Governor said the parliamentary and public accounts committees should be fully functional to check the elements of corruption in the public sector, while Auditor General should also detect and report the misuse of public resources.
The role of non-governmental organisations was equally important in a vibrant civil society, he further said.
He referred to a study that in countries where the civil society started owning the education and health sector services, the delivery of social services had drastically improved from those where only government was responsible for those services.