State Bank of Pakistan has imposed heavy penalties of nearly Rs. 98 million on three country’s most profitable major banks namely Habib Bank Limited, MCB Bank, and United Bank Limited on the account of violation of its rules and regulations.
According to the enforcement order issued by the central bank, the three banks were slapped with separate penalties of Rs. 97.5 million in the first quarter of January to March 2021.
Habib Bank Limited (HBL): The biggest and the most profitable bank in the country, was hammered with a penalty of Rs.39.7 million for violations of regulatory instructions pertaining to foreign exchange and general banking operations.
Muslim Commercial Bank (MCB): The another well-known bank also received a penalty of Rs. 10 million for violations of regulatory instructions pertaining to foreign exchange and general banking operations. MCB Islamic Bank, the subsidiary of the MCB Bank also faced a tough penal action of Rs. 37.09 million from the banking regulator for violations of regulatory instructions pertaining to AML/CFT, FX, and general banking operations.
United Bank Limited (UBL): The bank with huge profitability and a wide network, was also slapped a penalty of Rs. 10 million by the banking watchdog for violations of regulatory instructions pertaining to CDD/KYC and general banking operations. The bank’s management was asked to avoid the recurrence of such violations again.
The consistent violation by these banks is an extremely embarrassing situation for the top leadership of these renowned banks which make tall claims of innovations but have failed to control the wrongdoing in their operations again and again.
The banking regulator asked the banks’ management to strengthen its processes with respect to identified areas and to avoid the recurrence of such violations again.
SBP directed the bank’s management to conduct an internal inquiry on breaches of regulatory instructions and take disciplinary action against the irresponsible officials.