The State Bank of Pakistan on Tuesday suspended the authorisations of two exchange companies for violating its regulations and instruction.

“State Bank of Pakistan has suspended, with immediate effect, the authorisation of an Exchange Company B Namely M/s Premier Exchange Company –B (Pvt.) Limited till further orders on account of serious violations of State Bank’s regulations and instructions,” the central bank said in a statement.

The exchange company, its head office, and all branches have been debarred from undertaking any kind of business activity during the suspension period.

The SBP also suspended the authorisation of Al-Sahara Exchange Company for a period of three months on account of violations of the central bank’s regulations and instructions.

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“The Exchange Company, its head office, branches, franchises have been debarred from undertaking any kind of business activity during the suspension period,” the SBP stated.

In an attempt to strengthen governance, internal controls, and compliance culture in the currency exchange sector, the central bank on September 6 decided to introduce structural reforms in the sector.

The SBP wanted banks actively engaged in foreign exchange business to establish wholly owned Exchange Companies to cater to the legitimate foreign exchange needs of the general public, a statement by the central bank said.

Various types of existing exchange companies and their franchisees will be consolidated and transformed into a single category of ECs with a well-defined mandate.