The State Bank of Pakistan (SBP) will submit its stance on how huge bank loans were waived-off recently despite the lapse of Circular 29 in 2003 and the fact that the cases were pending before the apex court in the Supreme Court today (Monday).
A three-member Supreme Court bench comprising Chief Justice Iftikhar Muhammad Chaudhry, Justice Muhammad Sair Ali and Justice Ghulam Rabbani will resume hearing on a suo motu case about writing-off Rs 256 billion loans by banks between 1971 and 2009. Circular 29, which deals with writing off loans, issued under Section 33 of the Banking Companies Ordinance 1962 and instrumental in writing off Rs 256 billion loans from 1971 to 2009, had expired in 2003.
The court has also summoned the top bank executives to determine how they had advanced huge loans on insufficient guarantees, which were subsequently written off by the commercial banks. SBP’s counsel Syed Iqbal Haider will submit the central bank’s stance with the court.
