KARACHI, May 18: The State Bank has asked all banks and DFIs or development financial institutions to make ready their country risk management policies and procedures as soon as possible.

The central bank sent this advice to them through a circular of Banking Supervision Department issued on Monday. "All banks/DFIs are required to put in place their respective country risk management policies and procedures duly approved by their BOD (board of directors) as soon as possible but not later than three months from the date of this circular."

The circular said a copy of the policy should be sent to the Banking Supervision Department of SBP. "The SBP inspectors during the course of their regular inspection of the banks/DFIs will check the policies and procedures on country risk management of the concerned bank/ DFI."

In August last year, the central bank had issued detailed guidelines on four major risk categories i.e. credit, market, liquidity and operational risk.