960818
STATE BANK CIRCULARS RELATING TO BANKING AND CREDIT
BPRD Circular No. 28
dated the 18th August, 1996
Contributions and Donations for Charitable, Social, Educational and Public Welfare Purposes Prudential Regulation-XX.
1. In terms of Section 41 of the Banking Companies Ordinance, 1962, all banks and Development Finance Institutions are directed to strictly observe the following rules in the matter of making any donations/contributions for charitable, social, educational or public welfare purposes:
(i) Only those banks which meet provisioning and capital adequacy requirements prescribed by the State Bank and pay positive rates of return to their depositors can make donations;
(ii) Every donation or contribution to be made must carry the prior approval of the Board of Directors.
(iii) A donation and contribution shall be permissible only by way of appropriation from the net distributable profit of tile banks/DFIs.
2. Each bank and DFI shall furnish the State Bank with statement as of 31st December, indicating the names of persons and the amount of donation/contribution made to each out of the distributable profits of the preceding financial year, within 30 days of the close of the financial year.
3. Any violation or circumvention of this Regulation will render the bank/DFI concerned as also officials responsible for such violation or circumvention liable to penalties under the provisions of tile Banking Companies Ordinance, 1962.
4. The Regulation comes into force with immediate effect and supersedes all instructions earlier issued on the subject.
