State Bank of Pakistan has advised all commercial banks to install or update their systems including software(s) and database(s) to maintain a comprehensive depositor-wise database that will readily provide the details and information of the depositors and their accounts to the central bank and its subsidiaries within 48 hours.
The required database must have the ability to identify, on any given date, all the accounts of any single depositor and calculate the total liability of a bank towards that depositor (including any interest/profit accrued on his/her deposits).
In this regard, the Management Information System (MIS) will be designed to be used by SBP’s subsidiary Depositors Protection Corporation (DPC) in the event of reimbursement at any given cut-off date.
The MIS will streamline a database in a way that a single depositor view shall be achieved, preferably by using a Unique Identification Number that, in case of individuals’ accounts, should also be linked to their Computerized National Identity Cards (CNIC), Smart National Identity Cards (SNIC) or National Identity Card for Overseas Pakistanis (NICOP). In addition to identifying all the protected deposit accounts on the required MIS, each member bank is expected to be able to provide information.
The system should be able to update the information on a daily basis and all changes and updates made in the depositors’ information shall be logged. The system’s readiness and efficacy should be tested at regular intervals by the relevant department(s) under the operational risk framework of each bank and also under Business Continuity Planning (BCP) exercise. The compliance of the above instructions should be scrutinized by the internal audit of banks. SBP inspection shall assess the system’s readiness and compliance of the overall deposit protection framework.
Moreover, in case of any eventuality, the bank should be able to generate and provide the required information within a maximum time period of 48 hours of the issuance of notification under Section 21 of Act 10.
In light of this, all member banks have been advised to update their systems by June 30, 2019 and report the compliance to DPC. Further, all member banks have to provide a roadmap or action plan indicating how they will progress towards above-mentioned timeline; and such roadmap must be submitted to DPC latest by April 08, 2019. The banks are also required to report the position of depositors (on single depositor-wise basis) to DPC as of June 30, 2019 by July 31.
Depositor Protection Corporation has been set up to compensate the losses of depositors through the protection of their money maintained by any bank in case of any incident.