HISTORY OF BANK IN PAKISTAN

HISTORY OF BANK IN PAKISTANPRESENTED TO DR YOUNUS QADRIDEFINITION OF BANKAccepting for the purpose of lending or investment of deposits of money from public, repayable on demand or otherwise and withdrawal by cheque, draft, order or otherwise. (sec.5 (1) and 5(B)Banking Cos Ordinance, 1962 of Pakistan)

Humble beginnings, 1947 1970For nearly a year after partition, Pakistan had no central bank. Habib Bank established in 1941 filled this gap initially, until the State Bank of Pakistan (SBP) was set up in 1948 under quasi-government ownership.

Habib Bank, Allied Bank and National Bank were amongst the first to start operations with strong support from the central bank.

legacy of public control, 1970 1980

Commercial banking grew favorably in Pakistan until 1974. Under the nationalization policy implemented by Zulfikar Ali Bhuttos government.

thirteen banks were brought under full government control, and consolidated into six nationalized banksBusiness as usual, 1980-1990Over time, the financial sector grew to serve primarily large corporate business, politicians and the government.

Board of Directors and CEOs were not independently appointed. Lending decisions were not always commercially motivated, and many billions of rupees were unsurprisingly funneled out of the financial system as bad loans. Privatization, 1990 1997By 1991, the Bank Nationalisation Act was amended, and 23 banks were established of which ten were domestically licensed

By 1997, there were still four major state-owned banks, but they now faced competition from 21 domestic banks and 27 foreign banks.reforms, 1997 2006After privatization, transformational reforms were pushed through. The central banks regulatory powers were restored via amendments to the Banking Companies Ordinance (1962) and the State Bank of Pakistan Act (1956)The post-reform era, 2006 presentBuoyed by the spirit of liberalisation, the sectors landscape has changed significantly. By 2010, there were five public commercial banks,25 domestic private banks, six foreign banks and four specialised banks. There are now 9,348 bank branches spread throughout the country, catering to the needs of some 28 million deposit account-holders.

EasyPaisa, Omni Bank And Different Type of Short Banks Introduce in PakistanIntrest Rate In BanksReferencehttp://notes4students.webs.com/apps/forums/topics/show/1246517

History Of Banking Published in Tribune by Amna Khalabat Dated: November 4, 2011 Link: http://tribune.com.pk/story/286458/history-of-banking-in-pakistan--of-humble-origins-and-vast-potential/

Indicators From www.worldbank.org