The State Bank of Pakistan (SBP) has issued a no-objection certificate (NOC) to Habib Metropolitan Bank Limited, a subsidiary of Habib Bank AG Zurich – Switzerland, to establish a wholly-owned Exchange Company (EC).

HMB shared the development in its notice to the Pakistan Stock Exchange (PSX) on Monday.

“SBP has conveyed a ‘No Objection’ to Habib Metropolitan Bank Limited for establishing an exchange company in the name of M/s. HABIBMETRO Exchange Services Limited,” read the notice.

Earlier this month, HMB conveyed that it will establish an EC as a wholly-owned subsidiary.

“The Board of Directors of Habib Metropolitan Bank Limited through circular resolution dated October 09, 2023 has approved the establishment of an EC with an authorized capital of Rs1 billion,” read the notice.

Last week, the central bank had also issued NOCs to Allied Bank Limited and MCB Bank Limited for establishing an exchange company.

In September, the SBP, in its bid to strengthen controls amid the massive fall in rupee’s value in the open market, decided to introduce ‘structural reforms’ in the EC sector.

“As part of these reforms, leading banks actively engaged in foreign exchange business will establish wholly-owned Exchange Companies (EC) to cater to the legitimate foreign exchange needs of general public,” said the SBP in a statement.

Following this, some nine banking entities till date have announced they will establish an EC as a wholly-owned subsidiary, the most recent of which was Bank of Punjab.