Pakistan Central Bank Issued Show Cause Notice to Eight Banks Over Currency Speculation

Islamabad September 18 2022: Pakistan Central Bank, State Bank of Pakistan (SBP) issued show cause notice to eight banks over allegation of currency speculation as SBP is investigating whether they had charged well above market rate for opening of Letter of Credit (LCs) or not, says Pakistan’s Finance Minister Miftah Ismail.

However, he did not disclose the names of the commercial banks to which show cause notice has been issued.

“We will take strict measures against those who have violated the market and imposed hefty penalties” he added.

Pakistan Rupee touched low of 239.94 on 29th July 2022 on uncertainty of IMF program, but banks charged well above the rate of interbank during that period.

“We didn’t have enough dollars to defend our currency but i strongly believe that dollar will come down organically when people feel that dollar is overvalued. Positive statements from IMF, ADB and AIIB will help to improve sentiment in coming days” he added.

He further added, “We will not intervene in dollar market to manage our currency nor IMF will allow us to do this.”

Pakistan top ten banks earned an amount of PKR 27,671 million from dealing in foreign currencies in the period from April to June 2022 compared to full year earning of PKR 37,896 million in full year 2021.

Earning through Foreign Exchange Dealing for top ten banks of Pakistan