SBP Bank Investment Limits Revision Caps Startup Bets
Under BPRD Circular Letter No. 22 dated October 23, the SBP bank investment limits revision also covers mutual funds, REITs and private equity, and requires an approved equity policy.
The State Bank of Pakistan amended Regulation R-6 via BPRD Circular Letter No. 22 on October 23, covering all banks and development finance institutions.
A bank’s stake in any single company’s shares must stay within the lower of 5% of its Tier-I capital or 10% of that company’s paid-up shares.
For any one startup, including fintech, the cap is the lower of 5% of Tier-I capital or Rs500 million.
Mutual fund, REIT and private equity units face a lower-of 5% of Tier-I capital or 20% of that fund’s units; NIT units stay outside until privatisation.
Banks and DFIs must keep a board-approved equity investment policy with an objective evaluation process and exit plan.