Govt shifts Entire Fund from Commercial Banks to SBP – RS News

Govt shifts Entire Fund from Commercial Banks to SBP

All federal government, ministries, divisions, attached departments, and subordinate offices (MDAS) have been directed by the Finance Division to shut their bank accounts with the commercial or financial institutions and transfer the funds to the State Bank of Pakistan (SBP).

Regarding this, the SBP issued a circular on Wednesday to all the chief executives/presidents of commercial banks regarding Government Treasury Single Account (TSA) Closure of Government Accounts Maintained with Commercial Banks/DFIs.

According to the report, the SBP has also issued separate performa for the banks’ centralized treasuries for reporting to the chief manager SBP Banking Services Corporation, Karachi.

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The performa for banks stated:

Repatriation of Funds the Central Account I (non-Food) of the Federal Government in SBP in line with the directives of account holder’s institutions, through their authorized signatories, bank’s branches have closed the following government accounts and surrendered the available balances for onward credit to the Central Account I (non-Food) of the Federal Government with SBP.

Ensuring closure of all the accounts and transfer of their balances to SBP via a standardized procedure, banks were hereby advised to develop their internal applications and processes to keep track of the

  • Receipt of directives by the authorized signatories;
  • Closure of accounts by banks’ branches and transfer of available balances to their centralized treasury
  • Transfer of the consolidated amount by the centralized treasury to the SBP through RTGS.

Upon receipt of the account closure request, the respective branches will initiate the closure of accounts and transfer the available balances to their centralized treasuries within seven (07) days through their internal application.

According to a Topline Securities report, this process may take some time as no definitive timeline has been mentioned for receipt of Account Closure Request.

It was also noted in the report that the total deposits under Federal Government reach Rs. 1.4 trillion by August 2020.

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