Mission Statement :
To mainstream the agriculture and rural finance sector in the country’s financial system as a commercially viable and attractive business line and to catalyze growth and activity in the sector through sector friendly policies.
Vision Statement:
To transform ACD into a professional and dynamic Rural Finance Support Department, fully equipped to play a leading role in development of a sound, stable and robust agriculture and rural finance sector in the Country.
About Us:Agricultural Credit Department established under Section 8(3) of SBP Act 1956 and headed by a Director, is working within the overall charge of ED/Advisor on Development Finance. The Department is mainly responsible to meet credit needs of agriculture, being mainstay of Pakistan’s economy, generates nearly one fourth of the total out put and 42% of total employment and is a major source of foreign exchange earnings. The other functions of the department are as under:-
1. To operate as a focal point in SBP for all agriculture and rural finance policies, programs and projects.2. To assess/estimate the credit needs of farm & non farm sector in rural areas.3. To review the issues/challenges faced, developments taking place in agriculture/ rural finance both in the country and elsewhere, develop an adequate knowledge/ information base for policy formulation, etc.4. To formulate agri & rural finance policies in consultation with stakeholders and to ensure adequate flow of institutional credit in rural areas.5. To monitor growth and trends in agri/rural finance portfolio of banks & financial institutions.6. To collect periodical agri/rural finance data for analysis, policy formulation and dissemination to general public.7. To advise Federal and Provincial Governments, Banks, Cooperative Banks & Agriculture Chambers on agri & rural finance issues.8. To initiate and undertake information dissemination and awareness building programs for farmers and special training programs for commercial banks.9. To build SBP rural and agriculture finance capacity and.10. To operate as Secretariat for Agriculture Credit Advisory Committee (ACAC).
1. To operate as a focal point in SBP for all agriculture and rural finance policies, programs and projects.2. To assess/estimate the credit needs of farm & non farm sector in rural areas.3. To review the issues/challenges faced, developments taking place in agriculture/ rural finance both in the country and elsewhere, develop an adequate knowledge/ information base for policy formulation, etc.4. To formulate agri & rural finance policies in consultation with stakeholders and to ensure adequate flow of institutional credit in rural areas.5. To monitor growth and trends in agri/rural finance portfolio of banks & financial institutions.6. To collect periodical agri/rural finance data for analysis, policy formulation and dissemination to general public.7. To advise Federal and Provincial Governments, Banks, Cooperative Banks & Agriculture Chambers on agri & rural finance issues.8. To initiate and undertake information dissemination and awareness building programs for farmers and special training programs for commercial banks.9. To build SBP rural and agriculture finance capacity and.10. To operate as Secretariat for Agriculture Credit Advisory Committee (ACAC).
Agriculture Credit Estimation & Target Monitoring Division:
1. Agriculture credit estimation/assessment in consultation with stakeholders; 2. Allocation of indicative agri credit targets to banks; 3. Periodical monitoring of agriculture credit targets; 4. To undertake all functions relating to Agriculture Credit Advisory Committee (ACAC); 5. Follow-up for implementation of ACAC decisions; 6. Sanction of SBP credit line to Punjab Provincial Cooperative Bank Ltd. and its monitoring; 7. Managing Credit lines outstanding against Zarai Taraqiati Bank Ltd.; 8. Sharing of bonafide losses with five big commercial banks; 9. Collection of periodical agri finance data from banks and its dissemination on website and media.
Banking Inspection Department:Banking Inspection Department (BID) is one of the core departments at SBP. Its mission is to strive for soundness & stability of the financial system and safeguard interest of stakeholders through proactive inspection, compatible with best international practices.
BID plays a pivotal role in meeting SBP’s main responsibility of supervising the financial institutions to maintain soundness of the system and protection of the interest of depositors, thereby ensuring public confidence in the system. In order to assess a financial institution, BID conducts regular on-site inspection of all scheduled banks inclusive of the foreign banks & DFIs. The present supervisory structure at the department is institution focused whereby concerned Desk In-charges (Senior Joint Directors, Joint Directors & Junior Joint Directors) have been assigned specific institutions for effective monitoring through on-site examination, off-site reports from Banking Supervision Department and various market reports.
The regular on-site inspection is conducted on the basis of CAMELS Framework. (Capital, Asset Quality, Management, Earnings, Liquidity, Sensitivity and System & Controls). CAMELS is an effective rating system for evaluating the soundness of financial institutions on a uniform basis and for identifying these institutions requiring special attention or concern. Here the focus of inspection is generally on risk assessment policies & procedures of the banks and control environment to keep attached risks within acceptable limits and compliance with laws, regulations and supervisory directives. In continuation of the inspection process, discussions are held with external auditors to review banks’ internal controls, compliance with legislation & prudential standards and adequacy of provisions. Here it would be important to mention that BID works in close coordination with Off-Site Surveillance Desk at Banking Supervision Department and other departments in SBP.
BID conducts the regular full scope examination of banks pursuant to an inspection schedule; however, flexibility exists in policy for frequency of inspections depending upon the need to maintain safety & soundness. CAMELS rating is a criteria to determine the frequency of inspection of banks as weak institutions are given greater attention. Special investigations (targeted inspections) are also conducted as and when circumstances so warrant on the basis of complaints or market reports about specific institution.Examiners document their assessment of the overall risks posed by each bank in the inspection work papers and summarize their inspection findings in the form of inspection reports. In formulating this assessment, examiners consider all available sources of information including, but not limited to: findings, scope and recency of previous inspections, ongoing monitoring efforts of off site surveillance desks, information received through pre-inspection letters or other communications, regulatory reports and published financial information, reports of internal and external auditors.
Beside the regular inspection report, BID also prepares statutory reports under Section 25-AA of the Banking Companies Ordinance 1962 for banks regarding written-off loans, mark-up and other dues, or financial relief through rescheduling & restructuring of loans, on yearly basis and is submitted to Federal Government. Additionally, BID also submits a Quarterly Report to Federal Government under section 40A of Banking Companies Ordinance 1962 giving shortcomings and violations on the part of banking company’s management. BID also conducts inspection of exchange houses under regulation No 32 formulated under Clause (ii) of subsection 3AA of Foreign Exchange Regulation Act 1947.
BID plays a pivotal role in meeting SBP’s main responsibility of supervising the financial institutions to maintain soundness of the system and protection of the interest of depositors, thereby ensuring public confidence in the system. In order to assess a financial institution, BID conducts regular on-site inspection of all scheduled banks inclusive of the foreign banks & DFIs. The present supervisory structure at the department is institution focused whereby concerned Desk In-charges (Senior Joint Directors, Joint Directors & Junior Joint Directors) have been assigned specific institutions for effective monitoring through on-site examination, off-site reports from Banking Supervision Department and various market reports.
The regular on-site inspection is conducted on the basis of CAMELS Framework. (Capital, Asset Quality, Management, Earnings, Liquidity, Sensitivity and System & Controls). CAMELS is an effective rating system for evaluating the soundness of financial institutions on a uniform basis and for identifying these institutions requiring special attention or concern. Here the focus of inspection is generally on risk assessment policies & procedures of the banks and control environment to keep attached risks within acceptable limits and compliance with laws, regulations and supervisory directives. In continuation of the inspection process, discussions are held with external auditors to review banks’ internal controls, compliance with legislation & prudential standards and adequacy of provisions. Here it would be important to mention that BID works in close coordination with Off-Site Surveillance Desk at Banking Supervision Department and other departments in SBP.
BID conducts the regular full scope examination of banks pursuant to an inspection schedule; however, flexibility exists in policy for frequency of inspections depending upon the need to maintain safety & soundness. CAMELS rating is a criteria to determine the frequency of inspection of banks as weak institutions are given greater attention. Special investigations (targeted inspections) are also conducted as and when circumstances so warrant on the basis of complaints or market reports about specific institution.Examiners document their assessment of the overall risks posed by each bank in the inspection work papers and summarize their inspection findings in the form of inspection reports. In formulating this assessment, examiners consider all available sources of information including, but not limited to: findings, scope and recency of previous inspections, ongoing monitoring efforts of off site surveillance desks, information received through pre-inspection letters or other communications, regulatory reports and published financial information, reports of internal and external auditors.
Beside the regular inspection report, BID also prepares statutory reports under Section 25-AA of the Banking Companies Ordinance 1962 for banks regarding written-off loans, mark-up and other dues, or financial relief through rescheduling & restructuring of loans, on yearly basis and is submitted to Federal Government. Additionally, BID also submits a Quarterly Report to Federal Government under section 40A of Banking Companies Ordinance 1962 giving shortcomings and violations on the part of banking company’s management. BID also conducts inspection of exchange houses under regulation No 32 formulated under Clause (ii) of subsection 3AA of Foreign Exchange Regulation Act 1947.
Our Vision:
To transform Banking Surveillance Department into a highly professional and dynamic department fully equipped to proactively and effectively supervise the banking system.
Our Mission:To promote soundness and stability of the Banking System through proactive and effective supervision.
Introduction:Health of an economy depends on the degree of safety and stability of its banking and financial system. A sound, stable and robust banking and financial system is a pre-requisite for economic well being of a country and its populace. In Pakistan, ensuring the stability and soundness of the banking system is a statutory responsibility of State Bank of Pakistan. The banking supervision departments viz. Banking Policy and Regulations Department (BP&RD), Banking Surveillance Department (BSD), Off-Site Supervision and Enforcement Department (OSSED) and Banking Inspection Department (BID) have been assigned this important function to work jointly and severally to ensure the soundness of individual banks and of overall banking industry. The Banking Surveillance Department is responsible to supervise financial institutions in the country. The department ensures effective adherence to regulatory and supervisory policies, monitors risk profiles, evaluate operating performance of individual banks/DFIs and the industry as a whole while issuing guidelines for managing various types of risks. It also ensures that banks are adequately capitalized and have policies and systems in place to assess various risks. The department is also responsible for the implementation of the Basel II Accord in Pakistan. The function and activities of Credit Information Bureau (CIB) also falls within the domain of Banking Surveillance Department. The CIB collect credit data, under section 25A of the Banking Companies Ordinance 1962, maintain its database and disseminate credit information to financial institutions online to facilitate their credit appraisal process. The main objectives/key result areas of the Department are;
