State Bank of Pakistan (SBP) Governor Jameel Ahmad informed the National Assembly’s Standing Committee on Finance and Revenue on Tuesday that investigations had been launched regarding the role of banks in exchange rate manipulation.

Bank Al Habib, Habib Bank Limited, National Bank of Pakistan (NBP), Meezan Bank Limited, United Bank Limited (UBL), Allied Bank Limited (ABL) and Standard Chartered were being investigated in the first phase, Ahmad disclosed. However, he did not name the eighth bank.

Show-cause notices had been issued to ABL, NBP and Standard Chartered, he informed the panel.

He added that the rest of the banks would be investigated in the next phase.

During the meeting today, the committee’s chairman, MNA Qaiser Ahmad Sheikh, instructed SBP to take the appropriate action against all the banks and exchange companies involved in the manipulation of the exchange rate.

He asked the central bank to access the extent of violation by both entities and take appropriate action so that no one “has the audacity to play with the economy of the country”, according to a press release issued by the National Assembly Secretariat.

“The committee was of the view that during recent volatility in the exchange rate and the difference between the interbank rate and the rate offered by exchange companies, the banks earned exorbitant profits.”

Ahmad has assured the committee that violators would be penalised upon finalisation of the inquiry.

The Committee meeting was attended by Members of the Committee, Minister of State for Finance, Secretary Finance, Chairman FBR, Governor State Bank and other senior officers of the concerned departments.

Earlier, Dawn reported that banks had doubled their buying of the US currency and were sending it abroad via credit cards while the government grappled to control greenback outflows.

Currency market experts have said the SBP and the government had tight control over dollar buying from the open market, but the banks were providing a way out through credit cards.

Subsequently, in a media talk last week, Finance Minister Ishaq Dar said that nobody would be allowed to play with the exchange rate.

“This is not the right place where rupee stands at present,” he said, adding that he knew some speculators were involved in this game that they should stop forthwith.

Responding to a question he said it was big lie that PML-N government burnt dollars in the market to control exchange rate. “There were no dollars, how could one throw dollars,” he said.

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