PESHAWAR, Nov 22: Unfavourable law and order was seen as an impediment to execution of Bank of Khyber privatization. The government intends to float shares of the bank in the stock exchange, according to official sources.

“Law and order situation has been described as the main reason for delay,” said official sources holding important post.

The out-going provincial cabinet in one of its meetings, held some ten months back, had decided to start the much delayed privatization plan of the BoK.

In this respect, the provincial government, which holds over 85 per cent share of the BoK, had set September 30, as the deadline for off-loading its partly shares.

“Not only that the bank’s management failed to complete the given task, it even did not take a single step towards that direction,” said an official source who has frequently been attending the provincial cabinet’s meetings.

The failure on the part of the bank’s management has also been described as one of the main reasons that had made the NWFP governor to agree to the provincial finance minister’s request for replacing the BoK’s managing director - a move already executed last month by the finance department, NWFP.

On the other hand, the sources in the banking sector when approached told this scribe that the BoK’s management had suggested the provincial government to delay the intended shares’ flotation of the provincial public sector entity due to unfavourable law and order situation in the country.

“The Bank’s management had taken up the issue with the finance department as earlier as in June last,” said the sources.

When no reply was received from the provincial authorities concerned the Bank’s management decided to postpone the share flotation, said the sources resting the onus of delay in the share flotation on the outgoing provincial finance manager.

The general law and order situation confronted to the country in the wake of war against terrorism and looming political uncertainty in the country had further aggravated investment climate, said the sources.

The decision to partly privatize the BoK to reduce its over dependence on the provincial government had actually been taken by the last provincial government headed by chief minister Sardar Mehtab.

However, the decision remained unattended even during the last government’s days due to recessionary trends and unfavourable investment climate seen unsuitable to place BoK in the stock market.

Not only that the sitting government could not reduce BoK’s dependence on the provincial public sector accounts, it could not succeed in inching towards materializing the move of partly privatizing the Bank.

In response to a question, sources in the BoK said that failure to comply with the provincial cabinet’s decision of floating BoK’s share by Sept 30 was not the only reason that cost the out going MD, BoK, his office.

“The replacement of the MD BoK has much more than this lone reason, apparently, after the authorities concerned had been informed about the delay,” said an other official source.