The authorization of M/s Orient Exchange Company-B (Pvt) Limited and M/s Best Way Exchange Company-B (Pvt) Limited has been suspended, effective immediately, the State Bank of Pakistan (SBP) announced on Friday.
Three months will pass before the central bank is reinstated “due to serious violations of regulatory instructions.”
Both businesses were also urged by the SBP to improve internal control procedures and submit a report on corrective actions.
“Both ECs, their head offices, and all branches/outlets have been restricted from undertaking any kind of business activity during the suspension period,” the central bank added.
With the inspection team’s deadline of the end of the month, SBP has also broadened the scope of its inquiry into alleged exchange-rate manipulation beyond eight banks.
“Our inspection team is working on this (investigation against banks for manipulating exchange rates) and we have given it the end of the month as the deadline,” SBP Governor Jameel Ahmad had said while talking to reporters earlier this week.
The SBP announced last month that it would shortly finish looking into claims that commercial banks in the country have manipulated the country’s foreign exchange operations.
In September, the Pakistani rupee hit record lows against the US dollar before abruptly rebounding at the month’s conclusion, prompting authorities to suspect manipulation by banks and exchange companies. This was followed by the probe.
In recent times, the interbank market for the rupee has mostly remained stable.
Due to major infractions of the State Bank’s rules and directives, the SBP last month suspended with immediate effect the authorization of “B” Category Exchange Company M/s Mega Currency Exchange Company Limited until further orders.
To read our blog on “SBP denies rumors that the market intervened to lower the dollar’s price,” click here.
