KARACHI: The State Bank of Pakistan (SBP) has imposed Rs 224 million fines on five banks during the first quarter (Jan-March) of this year (CY23) for deficiencies in the compliance of regulatory instructions.

According to details of significant enforcement actions by SBP during the quarter ended March 31, 2023, some four banks were penalized for violation of regulatory instructions pertaining to Customer Due Diligence and Know Your Customer, foreign exchange and General Banking Operations.

While, one microfinance bank faced Rs 20.467 million penalty for violation of regulatory instructions pertaining to AML/CFT, Asset Quality and General Banking Operations.

In addition to penal action, the SBP has advised the microfinance bank to conduct an internal inquiry on breaches of regulatory instructions and take disciplinary action against the delinquent officials.

In addition to penal action, the SBP has also advised the other four banks to strengthen their controls and processes in the identified areas.

The SBP has made it clear that these actions are based on deficiencies in the compliance of regulatory instructions and does not constitute a comment on the financial soundness of the entities.

Copyright Business Recorder, 2023