Regulatory Alerts2025-07-30 | BPRD Circular No. 02 of 2025Added · Updated
Regulatory Framework on Recovery Planning
The State Bank of Pakistan mandates all banks, including foreign branches and Islamic Banking Institutions, to prepare and maintain comprehensive group-wide recovery plans. These plans must detail organizational structures, critical functions, recovery triggers, and a menu of feasible recovery options with quantified financial impacts on key ratios such as CET1 and LCR. Banks are required to incorporate contingency funding plans, define early warning indicators, and establish governance frameworks for testing and implementation. The framework outlines specific supervisory expectations for plan components, including asset disposal valuations, separability analyses, and timelines for executing recovery actions.
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