Enforcement action: SBP imposes over Rs755mn in penalties on 8 banks, 1 EC

The State Bank of Pakistan (SBP) imposed penalties worth Rs775.542 million on 8 banks and one exchange company during the quarter ended March 31, 2024, for non-compliance with legal or regulatory requirements.

The central bank takes supervisory enforcement actions against those institutions that fail to comply with legal or regulatory requirements and these actions may range from the imposition of penalties, administrative and financial sanctions, and reference to concerned law enforcement/prosecution agencies.

According to details issued by the central bank, Bank Alfalah Limited faced the highest penalty of Rs187.652 million in violation of regulatory instructions pertaining to FX and general banking operations.

In addition to penal action, the bank has been advised to improve its internal processes in order to avoid recurrence of such violations.

Enforcement action: SBP imposes over Rs465mn in penalties on 10 banks

Habib Bank Limited was second on the list with a penalty of Rs143.376 million for violation of regulatory instructions pertaining to CDD/KYC, FX and general banking operations.

In addition, the bank has been advised to ensure meticulous compliance with the regulatory instructions to avoid recurrence of similar instances in future.

Bank AL Habib Limited was third on the list with a penalty of Rs117.239 million for violation of regulatory instructions pertaining to CDD/KYC and FX.

In addition to penal action, the bank has been advised to strengthen its systems and controls to ensure meticulous compliance with the regulatory instruction and avoid recurrence of similar violations.

Fourth on the list was Meezan Bank Limited, which was penalised Rs106.2 million for violations of regulatory instructions pertaining to FX.

Further, the bank has been advised to strengthen its internal processes in order to minimize recurrence of such violations.

Habib Metropolitan Bank Limited was fifth on the list with a penalty of Rs70.915 million for violation of regulatory instructions pertaining to FX.

Moreover, the bank has been advised to strengthen its internal processes in order to minimize recurrence of such violations.

The SBP also imposed a penalty of Rs52.9 million MCB Bank Limited for violation regulatory instructions pertaining to FX and general banking operations. The bank has been advised to strengthen its internal processes in order to avoid recurrence of such violations.

Seventh on the list was MCB Islamic Bank Limited, which was penalised Rs38.544 million for violation of of regulatory instructions pertaining to AML/CFT, CDD/KYC and FX.

The bank has been further advised to ensure meticulous compliance with regulatory instructions to avoid enforcement actions in future.

Bank of Khyber was eighth on the list with a penalty of Rs30.741 million for the violation of regulatory instructions pertaining to CDD/KYC, asset quality and general banking operations. The bank has been further advised to ensure meticulous compliance with regulatory instructions to avoid enforcement actions in future.

Lastly, SBP also imposed a penalty of Rs27.975 million on the Royal Exchange Company for violation of regulatory instructions pertaining to CDD/KYC and general banking operations.