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ISLAMABAD: A report of the NA panel on the bill further to amend the SBP Banking Services Corporation Ordinance, 2001 [The SBP Banking Services Corporation (Amendment) Bill, 2020] was presented in the House on Friday.

The report was presented by Chairman Standing Committee on Finance and Revenue Faiz Ullah. In its statement of objects and reasons, the bill stated that the purpose of amendments to the SBP Banking Services Corporation Ordinance 2001(Ordinance) is to enable the SBP Banking Services Corporation (SBP BSC) to optimise its operational efficiency, thereby, bringing it in conformity with the emerging operational needs. It further stated that the amendments in the Ordinance are being proposed for the following reasons: (i) A new sub-section has been introduced in section 9, in line with good governance for the appointment of an Acting Managing Director within a period of 60 days, from the date of vacancy, provided that the Managing Director shall be appointed within a period of three months from the date of the occurrence of vacancy.

(ii) The power of the Board of Directors to appoint external auditors has been proposed in line with good governance.

(iii) An enabling clause on creation of subsidiaries by SBP BSC with the approval of Board and State Bank under the Ordinance has been introduced for operational efficiency.

(iv) Amendments have been proposed to exempt the gratuity and provident fund of employees of the Bank from attachment as already provided for, in case of pensioners to make the Ordinance consistent with the existing compensation benefits.

(v) In order to provide adequate protection to the Bank and the officers of the Bank for actions taken in good faith, amendments have been proposed in section 28 of the Ordinance.

(vi) A new section 24A has been proposed to legally protect the proceedings of the Board and the committees of the Board from any questions arising only on the grounds of any vacancy or any defect in the constitution of the Board.

This bill is designed to achieve the aforesaid purpose, it added.

In sub-section (1), clause (f) has been added which stated: “to carry out its functions effectively, the Bank if deemed necessary may, with the prior approval of the Board and State Bank, establish one or more subsidiaries for the purpose of conducting its business."; and (2) for sub-section (2), the following shall be substituted, namely:-" (2) The State Bank shall not transfer or delegate any of the functions specified in section 9A of the State Bank of Pakistan Act, 1956 including - (a) formulation and monitoring of monetary and credit policies;

(b) regulation and supervision of the financial sector; (c) foreign exchange regime and exchange rate policy; and (d) Payment and settlement system.".

In section 9, after sub-section (5), new sub-section (6) has been added, namely:-

At any time when the office of the Managing Director is vacant, the Governor may appoint any officer of the State Bank or from the Bank as Acting Managing Director within a period of 60 days from the date of vacancy: Provided that the Managing Director shall be appointed under sub-section (1) within a period of three months of the occurrence of vacancy."

Section 24 has also been substituted in Ordinance, which stated: “Notwithstanding anything contained in any law for the time being in force, pensions, gratuity and provident fund of the executives and other employees or pensioners shall not be liable to seizure, attachment or sequestration by process of any court order at the instance of a creditor, decree holder etc., for any demand against the executives, employees or pensioners in satisfaction of a decree or order of any court.” A new section 24 (A) has also been inserted to the Ordinance, which states, “No act or proceeding of the Board or the committees of the Board shall be questioned on the ground only on the existence of any vacancy in or any defect in the constitution of such Board or committee thereof.”

Another section 28 has also been inserted, which stated: “No suit or other legal proceedings shall lie against the State Bank and the Bank or any director or officer of the State Bank and the Bank for anything which is in good faith done or intended to be done in pursuance of this Ordinance or of any rules, regulations or orders made thereunder.”

Two bills were also laid before the house. These included: "The Muslim Family Laws Amendment Bill, 2021" and the "National Commission on the Rights of Child Amendment Bill, 2021". Speaker Asad Qaiser referred the bills to the standing committees concerned.

Copyright Business Recorder, 2021