State Bank of Pakistan

The State Bank of Pakistan (SBP; Urdu: بینک دولت پاکستان‎) is the central bank of Pakistan. While its constitution, as originally laid down in the State Bank of Pakistan Order 1948, remained basically unchanged until January 1, 1974, when the bank was nationalized, the scope of its functions was considerably enlarged. The State Bank of Pakistan Act 1956, with subsequent amendments, forms the basis of its operations today. The headquarters are located in the financial capital of Pakistan, Karachi with branch offices in 15 cities across Pakistan, including the capital city, Islamabad and the four provincial capitals.

History

Before independence on 14 August 1947, during British colonial regime the Reserve Bank of India was the central bank for both India and Pakistan. On 30 December 1948 the British Government's commission distributed the Reserve Bank of India's reserves between Pakistan and India -30 percent (750 M gold) for Pakistan and 70 percent for India.

The losses incurred in the transition to independence, small amount taken from Pakistan's share (a total of 230 million). In May, 1948 Muhammad Ali Jinnah (Founder of Pakistan) took steps to establish the State Bank of Pakistan immediately. These were implemented in June 1948, and the State Bank of Pakistan commenced operation on July 1, 1948

Pakistan

Coordinates: 30°N 70°E / 30°N 70°E / 30; 70

Pakistan (ⁱ/ˈpækᵻstæn/ or ⁱ/pɑːkiˈstɑːn/; Urdu: پاكستان‎ ALA-LC: Pākistān, pronounced [pɑːkɪst̪ɑːn]), officially the Islamic Republic of Pakistan (Urdu: اسلامی جمہوریۂ پاكستان‎ ALA-LC: Islāmī Jumhūriyah Pākistān IPA: [ɪslɑːmiː d͡ʒʊmɦuːriəɪh pɑːkɪst̪ɑːn]), is a country in South Asia. It is the sixth-most populous country with a population exceeding 199 million people. It is the 36th largest country in the world in terms of area with an area covering 881,913 km² (340,509 sq mi). Pakistan has a 1,046-kilometre (650 mi) coastline along the Arabian Sea and the Gulf of Oman in the south and is bordered by India to the east, Afghanistan to the west, Iran to the southwest and China in the far northeast respectively. It is separated from Tajikistan by Afghanistan's narrow Wakhan Corridor in the north, and also shares a maritime border with Oman.

The territory that now constitutes Pakistan was previously home to several ancient cultures, including the Mehrgarh of the Neolithic and the Bronze Age Indus Valley Civilisation, and was later home to kingdoms ruled by people of different faiths and cultures, including Hindus, Indo-Greeks, Muslims, Turco-Mongols, Afghans and Sikhs. The area has been ruled by numerous empires and dynasties, including the Indian Mauryan Empire, the Persian Achaemenid Empire, Alexander of Macedonia, the Arab Umayyad Caliphate, the Mongol Empire, the Mughal Empire, the Durrani Empire, the Sikh Empire and the British Empire. As a result of the Pakistan Movement led by Muhammad Ali Jinnah and the subcontinent's struggle for independence, Pakistan was created in 1947 as an independent nation for Muslims from the regions in the east and west of the Subcontinent where there was a Muslim majority. Initially a dominion, Pakistan adopted a new constitution in 1956, becoming an Islamic republic. A civil war in 1971 resulted in the secession of East Pakistan as the new country of Bangladesh.

State bank

A state bank is generally a financial institution that is chartered by a state. It differs from a reserve bank in that it does not necessarily control monetary policy (indeed, the state in question may have no legal capacity to create monetary policy), but instead usually offers only retail and commercial services.

A state bank that has been in operation for five years or less is called a de novo bank.

United States

In the United States the term "state chartered bank" or "state chartered savings bank" is used in contradistinction to "national bank" or "federal savings bank", which are technically chartered across all US states. All national banks and savings institutions are chartered and regulated by the Office of the Comptroller of the Currency. State banks are chartered and regulated by a state agency (often called the Department of Financial Institutions) in the state in which its headquarters are located. In addition, state banks that are members of the Federal Reserve are regulated by the Federal Reserve; state banks that are not members of the Federal Reserve are regulated by the Federal Deposit Insurance Corporation (FDIC). Therefore, virtually every state chartered bank has both a state and federal regulator. There are a very small number of state banks that do not have FDIC insurance.