KARACHI: For board members, chief executive officers and key executives of banks/DFIs, the State Bank has revised its instructions on Fit and Proper Test (FPT) criteria.
Various changes have been made so as to make FPT criteria more objective and to ensure succession planning and diversity of knowledge/experience base of management.
Board of Directors shall also formulate an organisation-wide rotation policy within three months, ensuring key executives are rotated appropriately after having served on a particular position for a reasonable time. Banks/DFIs shall ensure the posts of key executives shall not be filled on acting/additional charge basis for more than three months. In order to ensure compliance with SBP’s FPT criteria in respect of appointment on key positions, Banks/DFIs shall conduct prior self assessment of the fitness and propriety of their directors, presidents/CEOs and key executives and furnish an undertaking to this effect to SBP.
Moreover, appointment, compensation package, promotion/demotion and renewal of employment contracts of key executives shall invariably be approved by the Board of Directors or the concerned Board Committee of the Bank/DFI.
