Registrar Modaraba, SECP has asked Modaraba companies to expand their outreach and open their branches in towns and villages to cater requirements of the small businessmen and farmers. Speaking at the launching of the Year Book 2011 of NBFI and Modaraba Association here on Monday, Jawed Hussain said that there is a dire need that Modaraba companies should reach small businessmen and farmers in towns and villages of Pakistan.
He said that Modaraba companies are concentrated only in three big cities and their branch network is limited. He said Shariah banking has recorded a growth of 20 percent globally in the last five years. Operating in 77 countries, its assets base has surged to $1.3 trillion, he added.
Hussain appreciated the performance of Modaraba companies in Pakistan and said they have shown good results. Chairman, NBFI and Modaraba Association, Basheer A Chowdhry, while quoting financial figures from the Year Book, said that total assets of Modaraba companies have surged to Rs 67.156 billion while total equity base rose to Rs 18.342 billion by June 2011.
He said that Modaraba sector posted a profit of Rs 1.399 billion during the period under review against a loss of Rs 261 million in the same period last year. He pointed out that 21 out of 26 Modaraba companies have declared profit while 18 announced cash dividend ranging from 3 percent to 73 percent including one Modaraba paid 25 percent bonus during this period.
Referring to nine-month results, he said though profits of leasing companies and investment banks have declined, Modaraba companies reported a profit of Rs 935 million by March 2012. Chowdhry said that SECP has constituted a committee consisting of all stakeholders for preparing recommendations for the promotion and growth of non-banking financial institutions (NBFIs) and Modaraba companies.
He said the finalisation of recommendations is in the final stage for submission to the government for implementation. He informed the participants that SECP has allowed Modaraba companies to write off their infected portfolios in next two years. Chowdhry noted next few months were critical for corporate planning and management of Modaraba companies and NBFIs.
Managing partner, Deloitte Pakistan Asad Ali Shah explained salient features of revise code of conduct, particularly the changes and amendment introduced in April, at a seminar on revise code of corporate governance for members. He gave a critical review of code, saying that it was more relative to the changing requirements of the corporate sector, locally and internationally.
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