If lack of quorum on the board of directors is any criteria the State Bank of Pakistan (SBP) would stand tall among the country’s most ill-governed institutions. “State Bank of Pakistan is governed by an independent Board of Directors, which is responsible for the general superintendence and direction of the affairs of the Bank,” read the official documents.
However, it has been years that the SBP has seen all of these independent directors, whose number has been increased from seven to eight under March 2012’s amendment in the SBP Act, officiating at the Board in full strength.
Wednesday saw the federal government appointing five new non-executive directors for a three-year term which is extendable for another three year period. Those incorporate in the SBP’s central board include Mehmood Mandviwalla, Shahid Ahmed Khan, Nawaz Tiwana, Iskander Khan and Iqbal Hasan.
The new appointments would take immediate effect, said a notification issued by the Finance Division which despite taking years again left two seats vacant on the SBP board.
According to SBP website, before Wednesday Mirza Qamar Beg was the only non-executive director on SBP’s central board besides the ex-officio chairman, Governor Yaseen Anwar and Acting Secretary Finance Division Abdul Khaliq.
Sahar Z. Babar also has been on the board as a corporate secretary who is responsible for strategic planning, business continuity planning and maintaining oversight on the annual business planning function of the bank.
The much-awaited appointments were made in place of Zaffar A. Khan, Mohsin Aziz, Waqar A Malik, Tariq Sehgal, Kamran Y Mirza and Asad Umer. According to official sources, of the above directors only Umer had resigned and that too last year in May when he joined Pakistan Tehreek-i-Insaaf. “Umer had to resign because no political leader can officiate on SBP’s central board,” said a central banker.
Mirza’s tenure had completed two years back in fiscal year 2010-11.
“During the year 2010-11 (FY11), Mr. Kamran Y. Mirza completed his tenure as Director Central Board, and nominations against the positions vacated by him and previous two vacant positions are in the process of being decided by the federal government,” says the SBP under the head of its “Governance Structure”.
When contacted Federal Finance Minister Salim H. Mandviwala declined to comment on the years long delay by his predecessors to appoint new directors to the SBP board.
“I don’t want to say anything about the past,” the finance minister told Pakistan Today.
Mandviwala, however, said the two seats which are still lying vacant would be filled by “next week”.
Ideally, SBP’s central board should have 10 members: the governor as its chairman, secretary finance division, and eight non-executive directors that include at least one from each province, who shall be eminent professionals from the fields of economics, finance, banking and accountancy.
