KARACHI: The State Bank of Pakistan (SBP) has imposed Rs 775.542 million penalties on banks and financial institutions for violation of rules and regulations during the first quarter of this calendar year (CY24).

These fines were imposed on six commercial banks, two Islamic banks and one exchange company during Jan to March 2024 for non-compliance of rules and regulations issued by the SBP.

Most of the regulatory violations were pertaining to foreign exchange. While violations related to Customers Due Diligence (CDD), Know Your Customers (KYC) and general banking operations were also reported during the quarter under review.

Highest Rs 187.652 million penalty was imposed on a private bank on violation of regulatory instructions pertaining to foreign exchange and general banking operations. The SBP has also advised the bank to improve the internal processes in order to avoid recurrence of such violations.

An Exchange Company has faced a penalty of Rs 27.975 million on violation of regulatory instructions pertaining to CDD, KYC and general banking operations.

The SBP has also imposed Rs 144.744 million fine on two Islamicbanks for violation of regulatory instructions pertaining to FX, AML/CFT, CDD, KYC. Further, these banks have been advised to strengthen internal processes in order to minimize recurrence of such violations.

The SBP has advised banks and financial institutions to ensure meticulous compliance with regulatory instructions to avoid enforcement actions in future.

Copyright Business Recorder, 2024