Explaining the media reports regarding the recently introduced draft SBP Amendment Act 2021, the Finance Ministry said that it is a misconception that SBP is allowed unabatedly to share financial or non-financial private information with any institution out of the country.
He said, in Pakistan we adopt process with the permission of Federal Government and through the process given in the proposed act ( State Bank Amendment Act 2021). Said in a press release issued by the Ministry of Finance here on Wednesday.
A statement issued by the ministry said that SBP follows some protocols for the exchange of information. The exchange of information through Memorandums of Understanding (MoUs) is a common international process. Which central banks enter into MoUs with domestic and foreign regulatory bodies for the exchange of information.
He also said, that these are essential for the effective oversight of the overseas operations of subsidiaries and financial institutions. Importantly, the SBP already allowed to enter into MoUs with domestic and international supervisory authorities. Only after prior approval of the federal government under the proposed amendments.
Therefore, it is misleading to assert that the proposed SBP Act envisions no accountability for SBP. It is important to note that the proposed SBP Amendments Act 2021 clarifies the objectives of the SBP, and therefore, also makes the SBP more accountable for achieving those objectives.
The proposed amendments also have a new clause on accountability, which explains that SBP is answerable to the Parliament. Under this clause, the Governor shall submit an annual report before the Parliament. The report will explain the data relating to the achievements of the bank’s objectives.
SBP | State Bank of Pakistan | Memorandum of Understanding | Finance Ministry |