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Finance Minister Backs SECP’s Initiative to Bring Investment Through Private Funds

Interim Finance Minister Dr Shamshad Akhtar has extended her unwavering support to Securities and Exchange Commission of Pakistan’s (SECP) initiatives aimed at establishing financial institutions backed by private funds to serve as a catalyst for economic revival.

Chairing the meeting held by SECP to discuss proposals for establishing financial institutions backed by private funds to serve as a catalyst for economic revival, she asked the fiscal and regulatory sides, including the Federal Board of Revenue (FBR), the State Bank of Pakistan (SBP), and the SECP, to extend complete support to the initiatives of seeking investments from local financial institutions, institutional investors, government DFIs, and corporate entities with the potential to attract foreign capital.

The minister suggested making efforts, particularly to attract climate and ESG-focused international institutional investors. She stressed the urgency of implementing these initiatives to signal Pakistan’s readiness for business and economic growth to the global market and foreign investors.

The meeting brought together leaders from commercial banks and development finance institutions (DFIs). SECP Chairman Akif Saeed welcomed participants at the meeting, while Commissioner Mujtaba Ahmad Lodhi discussed SECP’s commitment to creating an enabling regulatory environment and its active engagement with banks and DFIs.

Habib Bank Limited, representing a consortium of banks, proposed the establishment of a Climate Resilience (CR) Fund under the SECP Private Fund Regulations, 2015. Khalida Habib, Executive Director Specialized Companies Division at SECP, on behalf of the DFIs, elaborated on the proposal for setting up a similar fund backed by DFIs. Whereas, Bank Alfalah presented a promising proposal to create a Special Purpose Vehicle (SPV) under the Asset-Backed Securitization Regulations, 2022 to securitize rupee-denominated debt to dollar denomination.

Saeed highlighted that regulatory requirements for effectively structuring a Private Fund ensure that professional fund management teams, independent of financial institutions, oversee fund management, bringing expertise in private equity, structured finance, and green investments. He also noted that the asset securitization proposal can potentially pave the way for unlocking new avenues in Pakistan’s Debt Capital Markets, benefiting all stakeholders.

The meeting concluded with commitment from all participants, including banks and DFIs, to work together for the greater good of Pakistan’s economy.

Source: Pro Pakistani