FAISALABAD, Nov 12: Kalim-ur-Rehman, President, Askari Commercial Bank Limited, has stressed upon the need of long-term credit to the commercial banks for reinvestment in long gestation industrial projects for ultimate revival of the industry and promotion of exports.

Addressing the members of All Pakistan Cloth Exporters Association (Apcea) here on Monday, he expressed optimism about the revival of industry in the wake of war against terrorism and said that industry as well as exporters should start long-term projects to harvest the new opportunities cropping up in the changed world scenario.

He said that banks were trying their best to cater to the needs of industrialists and exporters from their limited short-term deposits. He said that Askari Bank, understanding the importance of “Long Term Finance”, provided loans from the short-term deposits. But the difference between assets and liabilities is considered as mismanagement by the international banking reporters, which is affecting the credibility of Pakistani banks.

“I shall take up this issue with the Governor State Bank”, he said and urged upon the exporters to raise this issue with the quarters concerned. This will help the SBP to realize and issue long-term creditline to commercial banks for onward distribution among the exporters and industrialists, he added.

Mr Kalim pleaded the financial viability of banks and said that high ratio of non-performing loans was the root cause of the collapse of many DFIs and commercial banks which, in return, failed to provide much-needed finances for the renovation and replenishment of local industry. Continuing, he said that the government was forced to set up the CIRC where all the non-performing loans will be transferred, enabling banks to invest in new projects. He said that some commercial banks started about nine years ago with the Askari Bank also faced the same fate. “Some of them have been either merged or taken over by the State Bank”, he added.

Expressing satisfaction over the growth of Askari Bank, Mr Kalim claimed that its deposits stood at Rs37 billion with its assets of Rs43 to 44 billion.

The president Askari Bank said that banks were also a commercial identity and must be run on the principal of financial viability.

He said that contrary to his rule, the privatized banks were run as the government departments and ultimately lost their financial viability in spite of their huge size. He said that thus, these banks also failed to play their dynamic role due to the wrong decision of privatization.