The State Bank of Pakistan (SBP) has raised the upper limit of retail exposure to Rs 75 million in case of consumer loans and small business loans. According to a circular issued on Thursday, the exposure limit should not be more than 2 percent of total (gross) retail portfolio of the bank.
According to the revised definitions regarding corporate and retail exposures of the Central Bank under Basel-II, all public limited companies incorporated under Companies Ordinance, 1984 or any other statute will not fall under the definition of retail, regardless of their exposure.
With regard to staff loans of banks/DFIs, SBP clarified that staff housing finance qualifying as per definition "Residential Mortgage Finance" be treated as residential mortgage. Other staff loans shall be treated as retail or in any other categories provided respective requirements are fulfilled.