The State bank of Pakistan has asked the banks to use only the ‘solicited’ ratings, for capital adequacy. The term ‘solicited’ has been used indicating that the bank acquire its rating under a formal agreement with rating agency. However, the formal agreement is not required if the rating is given by an international rating agency, but the rating given should be made public. The banks also have been asked to disclose all credit ratings assigned by the Credit assessment agency within the last 15 months. Every movement in the capital adequacy ratio should be closely monitored. The SBP has also emphasized on the development of mechanism to monitor the changes in credit ratings.

Tagged with →  
Share →

Leave a Reply

%d bloggers like this: