STATE BANK OF PAKISTAN - BANKING POLICY DEPARTMENT

EPD Circular Letter No. 11 / Policy. 25(1) - 2004
October 11, 2004 

All Exchange Companies of ‘B’ Category

Dear Sirs,

Overnight Exposure

In order to facilitate Exchange Companies of ‘B’ Category, established under F.E. Circular No. 06 dated June 07, 2004, it has been decided to allow such Exchange Companies to carry a foreign currency exposure at the close of business each day at a level not higher than 25% of the capital base. The method to determine exposure shall be that the “Pak Rupee equivalent of all the Foreign Currencies held by the Exchange Company including at all of their branches, shall not exceed 25% of the capital base at the close of business each day”. Therefore, an Exchange Company of ‘B’ Category having a capital base of Rs. 20.0(M), may carry over to the next day total Foreign Currencies holding (Exposure) equivalent to Pak Rupees not exceeding 25% of its capital base i.e. Rs. 5.0 (M) at the close of business each day.
All Exchange Companies of ‘B’ Category are advised to observe the above instructions meticulously. Compliance to the above instructions shall be evaluated by SBP as and when deemed appropriate and deviations if any shall attract penal action.

Yours faithfully,