The State Bank of Pakistan (SBP) has identified eight Pakistani banks involved in an unprecedented increase in the US dollar rate in Pakistan. The names of these banks have been sent to the National Assembly Standing Committee for further action.
The banks, which include Habib Bank Limited, Allied Bank Limited, Bank Alfalah Limited, United Bank Limited, MCB Bank Limited, Bank Al Habib Limited, Meezan Bank Limited, National Bank of Pakistan, Askari Bank Limited and Habib Metropolitan Bank, reportedly made Rs27.8 billion profit on foreign exchange in the first quarter of the fiscal year 2022-23. This profit is more than what these banks earned in the full fiscal year of 2021-22.
According to media reports, these banks and some money exchange companies contributed to the increase in the US dollar rate, after a successful regime change operation in the country. For example, in three months of 2022, Allied Bank made 79.55% more income from foreign exchange than it did in all of 2021. During the same period, HBL made 94.55% of the income from foreign exchange than it did in the entire year of 2021.
The SBP and Pakistan’s Finance Ministry are responsible for regulating the banks in Pakistan, but they failed to effectively monitor and prevent this situation. Former finance minister of Pakistan, Miftah Ismail, had described the increase in dollar rate as the result of “market fundamentals” or “economic fundamentals”. However, it is now clear that this was not the case.
The new Finance Minister of Pakistan, Ishaq Dar, has promised to bring the US dollar rate below Rs200. According to experts, a fair analysis of the situation shows that one US dollar should be equal to Rs190 or Rs195. However, the current situation on the ground is significantly different.