The senator maintained in his complaint that the private bank forced his brother either to exchange remittances at Rs 154 against one US dollar when the inter-bank exchange rate against each dollar was Rs 156.20 or return the funds to the originating bank in the USA.
The findings of an assessment carried out by the SBP said: (a) the bank had declared in its Schedule of Charges (SoCs) that in case of inward remittance transactions where customers are not involved for rate negotiation, a spread of 1.5% would be charged. Further, the bank informed that the spread was calculated on prevailing inter-bank foreign exchange rate; (b) As per the bank, it applied a spread of 1.47 percent on this transaction which was well within the spread declared by the bank in SoCs and the conversion rate was verbally agreed with the beneficiary at the time of transaction; (c) the beneficiary had the option to withdraw foreign currency from its foreign currency account and sell the same to any authorized dealer (bank) of his choice or in the open market at the rate favorable to him; (d) and beneficiaries are not restricted by the SBP to sell their foreign exchange accounts proceeds on their bank's counter.
Additionally, the SBP's inter-bank exchange rate is indicative in nature as it is the weighted average exchange rate paid by banks when they trade foreign currencies with other banks. This may not necessarily be the rate that a bank quotes to its individual customers.