Islamabad: The State Bank of Pakistan has proposed formation of a Commission to the Supreme Court, under the supervision of a retired judge to recover written-off loans. A two-member bench headed by Chief Justice Iftikhar Chaudry is hearing the case regarding the 256 billion rupees worth loans written-off during the period of 1999 – 2009 by different banks.
The Central Bank lawyer informed the SC, that the bank is forming a commission headed by Rtd. Justice Saleem Akhtar, comprising of Rashid A Chughtai, former director-general SBP and Yousaf Adil, Chartered Accountant. The commission will submit its interim report within 90 days to the court. The court has given directions to SBP to publish terms of reference prepared by SBP along with the details about the commission in print media. In case Borrowers or customers have any objection against the formation of commission or terms of reference, they could appear before court.
Dr. Pervaz Hassan also requested the court to empower commission under Pakistan Commission of Inquiries Act, 1956 so that it could examine and verify the justification of amount written-off by banks from 1997 against 1300 borrowers having more than 100 million rupees volume. He further added that Court should also permit the commission to investigate loans written-off under political influence. The suggested time period for the submission of interim report is 90 days and 360 days for the final report.
The lawyer also requested the court to instruct the government to make amendments to the applicable laws for the banks and financial institutions regarding the recovery of written-off loans. The SBP Governor would be empowered to increase banking courts for the disposal of the cases initiated by concerned parties, banks and other financial institutions.
The Advocate General also stated that banks and financial institutions which have provided short term and long term loans against inadequate securities and collaterals are also responsible for plundering national wealth. He also said that adequate measures should also be taken to avoid such things in future.