The Finance Ministry published an explainer that said that the proposed State Bank of Pakistan (SBP) Amendment Act, 2021, will make the central bank autonomous in light of international best practices and domestic experiences.
According to the salient features of the proposed bill, the legal framework of the SBP is being amended to improve its accountability and outline the SBP’s functions in line with its objectives. The new legal framework will provide will improve transparency in the operations of the SBP. Authorized capital of the central bank will be increased from one hundred million rupees to five hundred billion rupees.
“Paid-up capital and general reserves to increase to 8% of the monetary liabilities of the Bank through retention of 20% of distributable profits each year,” the MoF stated• “General Reserve only to be used for increasing capital or cover losses.” The Bank shall, not less than twice a year, publish and submit to the Parliament and the Minister of Finance, a state of the economy report. [Detail statement of MoF]