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5.4pt;\r\n\tmso-para-margin:0in;\r\n\tmso-para-margin-bottom:.0001pt;\r\n\tmso-pagination:widow-orphan;\r\n\tfont-size:10.0pt;\r\n\tfont-family:Calibri;\r\n\tmso-ansi-language:#0400;\r\n\tmso-fareast-language:#0400;\r\n\tmso-bidi-language:#0400;}\r\n\u003c/style\u003e\r\n\u003c![endif]--\u003e\r\n\u003c/head\u003e\r\n\r\n\u003cbody lang=EN-US style=\u0027tab-interval:.5in;text-justify-trim:punctuation\u0027\u003e\r\n\r\n\u003cdiv class=Section1\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027margin-bottom:0in;margin-bottom:.0001pt;text-align:\r\njustify;line-height:normal;mso-pagination:none;mso-layout-grid-align:none;\r\ntext-autospace:none\u0027\u003e\u003cspan style=\u0027font-size:12.0pt;font-family:\"Times New Roman\";\r\nletter-spacing:.2pt\u0027\u003e\u003co:p\u003e\u0026nbsp;\u003c/o:p\u003e\u003c/span\u003e\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal align=center style=\u0027margin-bottom:0in;margin-bottom:.0001pt;\r\ntext-align:center;line-height:normal;mso-pagination:none;mso-layout-grid-align:\r\nnone;text-autospace:none\u0027\u003e\u003cb\u003e\u003cspan style=\u0027font-size:12.0pt;font-family:\"Times New Roman\";\r\nletter-spacing:.2pt\u0027\u003eLEGAL REGIME OF DEPOSIT PROTECTION\u003co:p\u003e\u003c/o:p\u003e\u003c/span\u003e\u003c/b\u003e\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal align=center style=\u0027margin-bottom:0in;margin-bottom:.0001pt;\r\ntext-align:center;line-height:normal;mso-pagination:none;mso-layout-grid-align:\r\nnone;text-autospace:none\u0027\u003e\u003cb\u003e\u003cspan style=\u0027font-size:12.0pt;font-family:\"Times New Roman\"\u0027\u003eIN\r\nPAKISTAN\u003co:p\u003e\u003c/o:p\u003e\u003c/span\u003e\u003c/b\u003e\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027margin-bottom:0in;margin-bottom:.0001pt;text-align:\r\njustify;line-height:normal;mso-pagination:none;mso-layout-grid-align:none;\r\ntext-autospace:none\u0027\u003e\u003cspan style=\u0027font-size:12.0pt;font-family:\"Times New Roman\"\u0027\u003e\u003co:p\u003e\u0026nbsp;\u003c/o:p\u003e\u003c/span\u003e\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal align=center style=\u0027margin-bottom:0in;margin-bottom:.0001pt;\r\ntext-align:center;line-height:normal;mso-pagination:none;mso-layout-grid-align:\r\nnone;text-autospace:none\u0027\u003e\u003cspan style=\u0027font-size:12.0pt;font-family:\"Times New Roman\"\u0027\u003eBy\u003co:p\u003e\u003c/o:p\u003e\u003c/span\u003e\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal align=center style=\u0027margin-bottom:0in;margin-bottom:.0001pt;\r\ntext-align:center;line-height:normal;mso-pagination:none;mso-layout-grid-align:\r\nnone;text-autospace:none\u0027\u003e\u003cspan style=\u0027font-size:12.0pt;font-family:\"Times New Roman\"\u0027\u003eMuhammad\r\nNaveed Chohan\u003co:p\u003e\u003c/o:p\u003e\u003c/span\u003e\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal align=center style=\u0027margin-bottom:0in;margin-bottom:.0001pt;\r\ntext-align:center;line-height:normal;mso-pagination:none;mso-layout-grid-align:\r\nnone;text-autospace:none\u0027\u003e\u003cspan style=\u0027font-size:12.0pt;font-family:\"Times New Roman\"\u0027\u003eAdvocate\r\nHigh Court, Lahore\u003co:p\u003e\u003c/o:p\u003e\u003c/span\u003e\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027margin-bottom:0in;margin-bottom:.0001pt;text-align:\r\njustify;line-height:normal;mso-pagination:none;mso-layout-grid-align:none;\r\ntext-autospace:none\u0027\u003e\u003cspan style=\u0027font-size:12.0pt;font-family:\"Times New Roman\"\u0027\u003e\u003co:p\u003e\u0026nbsp;\u003c/o:p\u003e\u003c/span\u003e\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027margin-bottom:0in;margin-bottom:.0001pt;text-align:\r\njustify;line-height:normal;mso-pagination:none;mso-layout-grid-align:none;\r\ntext-autospace:none\u0027\u003e\u003cb\u003e\u003cspan style=\u0027font-size:12.0pt;font-family:\"Times New Roman\"\u0027\u003eINTRODUCTION:\u003co:p\u003e\u003c/o:p\u003e\u003c/span\u003e\u003c/b\u003e\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027margin-bottom:0in;margin-bottom:.0001pt;text-align:\r\njustify;line-height:normal;mso-pagination:none;mso-layout-grid-align:none;\r\ntext-autospace:none\u0027\u003e\u003cspan style=\u0027font-size:12.0pt;font-family:\"Times New Roman\";\r\nletter-spacing:.3pt\u0027\u003e\u003co:p\u003e\u0026nbsp;\u003c/o:p\u003e\u003c/span\u003e\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027margin-bottom:0in;margin-bottom:.0001pt;text-align:\r\njustify;line-height:normal;mso-pagination:none;mso-layout-grid-align:none;\r\ntext-autospace:none\u0027\u003e\u003cspan style=\u0027font-size:12.0pt;font-family:\"Times New Roman\";\r\nletter-spacing:.3pt\u0027\u003eIn recent years, banking instability has emerged as a \u003c/span\u003e\u003cspan\r\nstyle=\u0027font-size:12.0pt;font-family:\"Times New Roman\";letter-spacing:-.25pt\u0027\u003emajor\r\nproblem in the developed and developing countries due to \u003c/span\u003e\u003cspan\r\nstyle=\u0027font-size:12.0pt;font-family:\"Times New Roman\";letter-spacing:.35pt\u0027\u003ecollapse\r\nof various banking companies around the world. \u003c/span\u003e\u003cspan style=\u0027font-size:\r\n12.0pt;font-family:\"Times New Roman\";letter-spacing:.25pt\u0027\u003eDespite economic\r\nshocks and stress in stock markets, the \u003c/span\u003e\u003cspan style=\u0027font-size:12.0pt;\r\nfont-family:\"Times New Roman\";letter-spacing:.1pt\u0027\u003ebanking system of Pakistan\r\nhas shown good performance in \u003c/span\u003e\u003cspan style=\u0027font-size:12.0pt;font-family:\r\n\"Times New Roman\";letter-spacing:-.05pt\u0027\u003e2009. But non-performing loans,\r\npresence of foreign banks in \u003c/span\u003e\u003cspan style=\u0027font-size:12.0pt;font-family:\r\n\"Times New Roman\"\u0027\u003emarket and banking governance issues incite us to form tight\r\n\u003cspan style=\u0027letter-spacing:-.05pt\u0027\u003elegal structure and regulations to protect\r\ndepositors from any \u003c/span\u003ebanking default. According to one view deposit\r\nprotection law is \u003cspan style=\u0027letter-spacing:-.25pt\u0027\u003ea major component of\r\nfinancial system safety net that promotes \u003c/span\u003e\u003cspan style=\u0027letter-spacing:\r\n.1pt\u0027\u003efinancial stability. But on the other hand it is also criticized \u003c/span\u003e\u003cspan\r\nstyle=\u0027letter-spacing:.65pt\u0027\u003ebecause this scheme introduces a moral hazard\r\nissue, \u003c/span\u003e\u003cspan style=\u0027letter-spacing:-.05pt\u0027\u003eencouraging both depositors\r\nand banks to take excessive risks.\u0027\u003c/span\u003e\u003cspan style=\u0027letter-spacing:.3pt\u0027\u003e\u003co:p\u003e\u003c/o:p\u003e\u003c/span\u003e\u003c/span\u003e\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027margin-bottom:0in;margin-bottom:.0001pt;text-align:\r\njustify;line-height:normal;mso-pagination:none;mso-layout-grid-align:none;\r\ntext-autospace:none\u0027\u003e\u003cspan style=\u0027font-size:12.0pt;font-family:\"Times New Roman\";\r\nletter-spacing:.15pt\u0027\u003e\u003co:p\u003e\u0026nbsp;\u003c/o:p\u003e\u003c/span\u003e\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027margin-bottom:0in;margin-bottom:.0001pt;text-align:\r\njustify;line-height:normal;mso-pagination:none;mso-layout-grid-align:none;\r\ntext-autospace:none\u0027\u003e\u003cspan style=\u0027font-size:12.0pt;font-family:\"Times New Roman\";\r\nletter-spacing:.15pt\u0027\u003eThis paper covers the legal regime of deposit protection \u003c/span\u003e\u003cspan\r\nstyle=\u0027font-size:12.0pt;font-family:\"Times New Roman\";letter-spacing:.05pt\u0027\u003ein\r\nPakistan. First part describes the need of deposit protection \u003c/span\u003e\u003cspan\r\nstyle=\u0027font-size:12.0pt;font-family:\"Times New Roman\";letter-spacing:.1pt\u0027\u003elaw\r\nand rise of an explicit system in current scenario. Second \u003c/span\u003e\u003cspan\r\nstyle=\u0027font-size:12.0pt;font-family:\"Times New Roman\";letter-spacing:.6pt\u0027\u003epart\r\nbriefly deals with the historical overview about the \u003c/span\u003e\u003cspan\r\nstyle=\u0027font-size:12.0pt;font-family:\"Times New Roman\";letter-spacing:.55pt\u0027\u003eemergence\r\nof deposit protection. Third part presents an \u003c/span\u003e\u003cspan style=\u0027font-size:\r\n12.0pt;font-family:\"Times New Roman\";letter-spacing:.1pt\u0027\u003eanalysis of proposed\r\nlaw of Deposit Protection Fund (DPF) in \u003c/span\u003e\u003cspan style=\u0027font-size:12.0pt;\r\nfont-family:\"Times New Roman\";letter-spacing:.15pt\u0027\u003ePakistan. Final part\r\nconcludes this paper by summarizing all \u003c/span\u003e\u003cspan style=\u0027font-size:12.0pt;\r\nfont-family:\"Times New Roman\"\u0027\u003eparts.\u003cspan style=\u0027letter-spacing:.15pt\u0027\u003e\u003co:p\u003e\u003c/o:p\u003e\u003c/span\u003e\u003c/span\u003e\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027margin-bottom:0in;margin-bottom:.0001pt;text-align:\r\njustify;line-height:normal;mso-pagination:none;mso-layout-grid-align:none;\r\ntext-autospace:none\u0027\u003e\u003cspan style=\u0027font-size:12.0pt;font-family:\"Times New Roman\";\r\nletter-spacing:.4pt\u0027\u003e\u003co:p\u003e\u0026nbsp;\u003c/o:p\u003e\u003c/span\u003e\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027margin-bottom:0in;margin-bottom:.0001pt;text-align:\r\njustify;line-height:normal;mso-pagination:none;mso-layout-grid-align:none;\r\ntext-autospace:none\u0027\u003e\u003cb\u003e\u003cspan style=\u0027font-size:12.0pt;font-family:\"Times New Roman\";\r\nletter-spacing:.4pt\u0027\u003eNEED OF DEPOSIT PROTECTION LAW AND RISE OF \u003c/span\u003e\u003c/b\u003e\u003cb\u003e\u003cspan\r\nstyle=\u0027font-size:12.0pt;font-family:\"Times New Roman\";letter-spacing:.3pt\u0027\u003eAN\r\nEXPLICIT SYSTEM \u003co:p\u003e\u003c/o:p\u003e\u003c/span\u003e\u003c/b\u003e\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027margin-bottom:0in;margin-bottom:.0001pt;text-align:\r\njustify;line-height:normal;mso-pagination:none;mso-layout-grid-align:none;\r\ntext-autospace:none\u0027\u003e\u003cspan style=\u0027font-size:12.0pt;font-family:\"Times New Roman\";\r\nletter-spacing:-.05pt\u0027\u003e\u003co:p\u003e\u0026nbsp;\u003c/o:p\u003e\u003c/span\u003e\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027margin-bottom:0in;margin-bottom:.0001pt;text-align:\r\njustify;line-height:normal;mso-pagination:none;mso-layout-grid-align:none;\r\ntext-autospace:none\u0027\u003e\u003cspan style=\u0027font-size:12.0pt;font-family:\"Times New Roman\";\r\nletter-spacing:-.05pt\u0027\u003eDeposit protection law protects depositors from losses\r\nin the \u003c/span\u003e\u003cspan style=\u0027font-size:12.0pt;font-family:\"Times New Roman\";\r\nletter-spacing:.5pt\u0027\u003eevent of bank failures and gives the nation a formal and \u003c/span\u003e\u003cspan\r\nstyle=\u0027font-size:12.0pt;font-family:\"Times New Roman\";letter-spacing:-.2pt\u0027\u003econsistent\r\nmechanism for resolving failing bank situation. Such \u003c/span\u003e\u003cspan\r\nstyle=\u0027font-size:12.0pt;font-family:\"Times New Roman\";letter-spacing:.3pt\u0027\u003ecompensation\r\nschemes are justified on the basis that they \u003c/span\u003e\u003cspan style=\u0027font-size:\r\n12.0pt;font-family:\"Times New Roman\";letter-spacing:-.15pt\u0027\u003eenhance customer\r\nconfidence. Deposit protection scheme (DPS) \u003c/span\u003e\u003cspan style=\u0027font-size:12.0pt;\r\nfont-family:\"Times New Roman\";letter-spacing:.3pt\u0027\u003emakes clear that, banks are\r\nnow privately owned and that \u003c/span\u003e\u003cspan style=\u0027font-size:12.0pt;font-family:\r\n\"Times New Roman\";letter-spacing:.05pt\u0027\u003edepositors are no longer are guaranteed\r\nby the government\u003csup\u003e2\u003c/sup\u003e. \u003c/span\u003e\u003cspan style=\u0027font-size:12.0pt;font-family:\r\n\"Times New Roman\";letter-spacing:-.1pt\u0027\u003eProtecting the safety of small\r\nuninformed depositors is a major \u003c/span\u003e\u003cspan style=\u0027font-size:12.0pt;\r\nfont-family:\"Times New Roman\";letter-spacing:.4pt\u0027\u003ecriterion for the enhancing\r\ndeposits mobilization\u003csup\u003e3\u003c/sup\u003e. In the \u003c/span\u003e\u003cspan style=\u0027font-size:12.0pt;\r\nfont-family:\"Times New Roman\";letter-spacing:.3pt\u0027\u003eabsence of this law\r\ndepositors shift their deposits to other \u003c/span\u003e\u003cspan style=\u0027font-size:12.0pt;\r\nfont-family:\"Times New Roman\";letter-spacing:.4pt\u0027\u003ecountries where deposits are\r\nprotected. This scheme also \u003c/span\u003e\u003cspan style=\u0027font-size:12.0pt;font-family:\r\n\"Times New Roman\";letter-spacing:.1pt\u0027\u003eexpects from depositors to remain\r\ncareful in the placement of \u003c/span\u003e\u003cspan style=\u0027font-size:12.0pt;font-family:\r\n\"Times New Roman\";letter-spacing:.85pt\u0027\u003etheir deposits. This scheme is\r\nimportant for banks to \u003c/span\u003e\u003cspan style=\u0027font-size:12.0pt;font-family:\"Times New Roman\";\r\nletter-spacing:.05pt\u0027\u003ediscourage runs on banks in trouble. If depositors are\r\nassured that they are protected in case of any banking failure, they will \u003c/span\u003e\u003cspan\r\nstyle=\u0027font-size:12.0pt;font-family:\"Times New Roman\"\u0027\u003enot rush to withdraw\r\ntheir deposits.\u003cspan style=\u0027letter-spacing:.05pt\u0027\u003e\u003co:p\u003e\u003c/o:p\u003e\u003c/span\u003e\u003c/span\u003e\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027margin-bottom:0in;margin-bottom:.0001pt;text-align:\r\njustify;line-height:normal;mso-pagination:none;mso-layout-grid-align:none;\r\ntext-autospace:none\u0027\u003e\u003cspan style=\u0027font-size:12.0pt;font-family:\"Times New Roman\";\r\nletter-spacing:.55pt\u0027\u003e\u003co:p\u003e\u0026nbsp;\u003c/o:p\u003e\u003c/span\u003e\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027margin-bottom:0in;margin-bottom:.0001pt;text-align:\r\njustify;line-height:normal;mso-pagination:none;mso-layout-grid-align:none;\r\ntext-autospace:none\u0027\u003e\u003cspan style=\u0027font-size:12.0pt;font-family:\"Times New Roman\";\r\nletter-spacing:.55pt\u0027\u003eThere are two types of deposit protection systems \u003c/span\u003e\u003cspan\r\nstyle=\u0027font-size:12.0pt;font-family:\"Times New Roman\";letter-spacing:.45pt\u0027\u003enamely\r\nimplicit protection system and explicit protection \u003c/span\u003e\u003cspan\r\nstyle=\u0027font-size:12.0pt;font-family:\"Times New Roman\";letter-spacing:.15pt\u0027\u003esystem.\r\nBoth systems have same set of objectives to protect \u003c/span\u003e\u003cspan\r\nstyle=\u0027font-size:12.0pt;font-family:\"Times New Roman\";letter-spacing:.45pt\u0027\u003edepositors\r\nand to maintain a stable banking system. But \u003c/span\u003e\u003cspan style=\u0027font-size:\r\n12.0pt;font-family:\"Times New Roman\";letter-spacing:-.05pt\u0027\u003eexplicit protection\r\nsystem is considered as better than implicit \u003c/span\u003e\u003cspan style=\u0027font-size:\r\n12.0pt;font-family:\"Times New Roman\";letter-spacing:.1pt\u0027\u003eprotection system\r\nbecause in implicit system government has \u003c/span\u003e\u003cspan style=\u0027font-size:12.0pt;\r\nfont-family:\"Times New Roman\";letter-spacing:.3pt\u0027\u003etotal discretion. Explicit\r\nsystem is likely to produce faster, \u003c/span\u003e\u003cspan style=\u0027font-size:12.0pt;\r\nfont-family:\"Times New Roman\";letter-spacing:.45pt\u0027\u003esmoother and more\r\npredictable resolution of failing bank \u003c/span\u003e\u003cspan style=\u0027font-size:12.0pt;\r\nfont-family:\"Times New Roman\";letter-spacing:.2pt\u0027\u003esituations. This system has\r\npredetermined rules of the game \u003c/span\u003e\u003cspan style=\u0027font-size:12.0pt;\r\nfont-family:\"Times New Roman\";letter-spacing:.1pt\u0027\u003eand offers better protection\r\nto small depositors than implicit \u003c/span\u003e\u003cspan style=\u0027font-size:12.0pt;\r\nfont-family:\"Times New Roman\";letter-spacing:.05pt\u0027\u003esystem where there is only\r\ngrantee of deposit protection from \u003c/span\u003e\u003cspan style=\u0027font-size:12.0pt;\r\nfont-family:\"Times New Roman\";letter-spacing:.25pt\u0027\u003egovernment without any set\r\nrules. Explicit system is also a \u003c/span\u003e\u003cspan style=\u0027font-size:12.0pt;\r\nfont-family:\"Times New Roman\";letter-spacing:.35pt\u0027\u003euseful vehicle for shifting\r\ncost of deposit protection to the \u003c/span\u003e\u003cspan style=\u0027font-size:12.0pt;\r\nfont-family:\"Times New Roman\"\u0027\u003ebanking system in the form of required premium.\u003co:p\u003e\u003c/o:p\u003e\u003c/span\u003e\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027margin-bottom:0in;margin-bottom:.0001pt;text-align:\r\njustify;line-height:normal;mso-pagination:none;mso-layout-grid-align:none;\r\ntext-autospace:none\u0027\u003e\u003cspan style=\u0027font-size:12.0pt;font-family:\"Times New Roman\";\r\nletter-spacing:.6pt\u0027\u003e\u003co:p\u003e\u0026nbsp;\u003c/o:p\u003e\u003c/span\u003e\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027margin-bottom:0in;margin-bottom:.0001pt;text-align:\r\njustify;line-height:normal;mso-pagination:none;mso-layout-grid-align:none;\r\ntext-autospace:none\u0027\u003e\u003cspan style=\u0027font-size:12.0pt;font-family:\"Times New Roman\";\r\nletter-spacing:.6pt\u0027\u003eBut on the other hand, the desirability of deposit \u003c/span\u003e\u003cspan\r\nstyle=\u0027font-size:12.0pt;font-family:\"Times New Roman\"\u0027\u003eprotection is a matter\r\nof some controversies. This scheme can \u003cspan style=\u0027letter-spacing:.3pt\u0027\u003ecreate\r\na wrong impression on the banking sector, because \u003c/span\u003e\u003cspan\r\nstyle=\u0027letter-spacing:.45pt\u0027\u003ecustomers do not care about their choice of banks\r\nand it \u003c/span\u003e\u003cspan style=\u0027letter-spacing:.15pt\u0027\u003eencourages banks to take\r\ngreater risks. But these tendencies \u003c/span\u003e\u003cspan style=\u0027letter-spacing:.25pt\u0027\u003ecan\r\nbe decreased or removed due to effective supervision of \u003c/span\u003ebank risks.\u003co:p\u003e\u003c/o:p\u003e\u003c/span\u003e\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027margin-bottom:0in;margin-bottom:.0001pt;text-align:\r\njustify;line-height:normal;mso-pagination:none;mso-layout-grid-align:none;\r\ntext-autospace:none\u0027\u003e\u003cspan style=\u0027font-size:12.0pt;font-family:\"Times New Roman\";\r\nletter-spacing:1.65pt\u0027\u003e\u003co:p\u003e\u0026nbsp;\u003c/o:p\u003e\u003c/span\u003e\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027margin-bottom:0in;margin-bottom:.0001pt;text-align:\r\njustify;line-height:normal;mso-pagination:none;mso-layout-grid-align:none;\r\ntext-autospace:none\u0027\u003e\u003cb\u003e\u003cspan style=\u0027font-size:12.0pt;font-family:\"Times New Roman\";\r\nletter-spacing:1.65pt\u0027\u003eEMERGENCE OF DEPOSIT PROTECTION: A \u003c/span\u003e\u003c/b\u003e\u003cb\u003e\u003cspan\r\nstyle=\u0027font-size:12.0pt;font-family:\"Times New Roman\";letter-spacing:.4pt\u0027\u003eHISTORICAL\r\nOVERVIEW\u003co:p\u003e\u003c/o:p\u003e\u003c/span\u003e\u003c/b\u003e\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027margin-bottom:0in;margin-bottom:.0001pt;text-align:\r\njustify;line-height:normal;mso-pagination:none;mso-layout-grid-align:none;\r\ntext-autospace:none\u0027\u003e\u003cspan style=\u0027font-size:12.0pt;font-family:\"Times New Roman\";\r\nletter-spacing:.45pt\u0027\u003e\u003co:p\u003e\u0026nbsp;\u003c/o:p\u003e\u003c/span\u003e\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027margin-bottom:0in;margin-bottom:.0001pt;text-align:\r\njustify;line-height:normal;mso-pagination:none;mso-layout-grid-align:none;\r\ntext-autospace:none\u0027\u003e\u003cspan style=\u0027font-size:12.0pt;font-family:\"Times New Roman\";\r\nletter-spacing:.45pt\u0027\u003eThe oldest system of deposit protection is the U.S. \u003c/span\u003e\u003cspan\r\nstyle=\u0027font-size:12.0pt;font-family:\"Times New Roman\";letter-spacing:.35pt\u0027\u003esystem,\r\nwhich was established in 1934 under The Federal \u003c/span\u003e\u003cspan style=\u0027font-size:\r\n12.0pt;font-family:\"Times New Roman\";letter-spacing:.2pt\u0027\u003eInsurance Corporation\r\n(FDIC) to prevent the extensive bank \u003c/span\u003e\u003cspan style=\u0027font-size:12.0pt;\r\nfont-family:\"Times New Roman\";letter-spacing:.15pt\u0027\u003eruns that contributed to\r\nGreat Depression\u003csup\u003e4\u003c/sup\u003e. This corporation \u003c/span\u003e\u003cspan style=\u0027font-size:\r\n12.0pt;font-family:\"Times New Roman\";letter-spacing:.85pt\u0027\u003ewas created under\r\nthe Glass-Steagall Act, 1933. This \u003c/span\u003e\u003cspan style=\u0027font-size:12.0pt;\r\nfont-family:\"Times New Roman\";letter-spacing:-.15pt\u0027\u003earrangement got popularity\r\nand spread around the globe in the \u003c/span\u003e\u003cspan style=\u0027font-size:12.0pt;\r\nfont-family:\"Times New Roman\";letter-spacing:.45pt\u0027\u003ebanking industries of other\r\ncountries. Countries such as \u003c/span\u003e\u003cspan style=\u0027font-size:12.0pt;font-family:\r\n\"Times New Roman\";letter-spacing:.85pt\u0027\u003eNorway, India, Canada and Japan\r\nintroduced deposit \u003c/span\u003e\u003cspan style=\u0027font-size:12.0pt;font-family:\"Times New Roman\";\r\nletter-spacing:.65pt\u0027\u003eprotection schemes in the \u002760s and \u002770s. In the UK first \u003c/span\u003e\u003cspan\r\nstyle=\u0027font-size:12.0pt;font-family:\"Times New Roman\";letter-spacing:.8pt\u0027\u003etime\r\nDeposit Protection Scheme (DPS) was introduced \u003c/span\u003e\u003cspan style=\u0027font-size:\r\n12.0pt;font-family:\"Times New Roman\";letter-spacing:.55pt\u0027\u003eunder Banking Act,\r\n1979\u003csup\u003e5\u003c/sup\u003e. But, after the introduction of \u003c/span\u003e\u003cspan style=\u0027font-size:\r\n12.0pt;font-family:\"Times New Roman\";letter-spacing:-.05pt\u0027\u003eOxford University\r\nPress, 2005, at page 49. \u003c/span\u003e\u003cspan style=\u0027font-size:12.0pt;font-family:\"Times New Roman\";\r\nletter-spacing:.95pt\u0027\u003eFi\u003csub\u003en\u003c/sub\u003eancial Services and Markets Act (FSMA) 2000\r\nall \u003c/span\u003e\u003csub\u003e\u003cspan style=\u0027font-size:12.0pt;font-family:\"Times New Roman\";\r\nletter-spacing:.6pt\u0027\u003ere\u003c/span\u003e\u003c/sub\u003e\u003cspan style=\u0027font-size:12.0pt;font-family:\r\n\"Times New Roman\";letter-spacing:.6pt\u0027\u003egulatory powers including all operations\r\nof DPS were \u003c/span\u003e\u003cspan style=\u0027font-size:12.0pt;font-family:\"Times New Roman\";\r\nletter-spacing:-.05pt\u0027\u003egiven to Financial Services Authority (FSA). As banking\r\ncrises \u003c/span\u003e\u003cspan style=\u0027font-size:12.0pt;font-family:\"Times New Roman\";\r\nletter-spacing:-.1pt\u0027\u003eescalated, deposit insurance schemes were introduced in\r\nmany other countries.\u003c/span\u003e\u003cspan style=\u0027font-size:12.0pt;font-family:\"Times New Roman\";\r\nletter-spacing:.55pt\u0027\u003e\u003co:p\u003e\u003c/o:p\u003e\u003c/span\u003e\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027margin-bottom:0in;margin-bottom:.0001pt;text-align:\r\njustify;line-height:normal;mso-pagination:none;mso-layout-grid-align:none;\r\ntext-autospace:none\u0027\u003e\u003cspan style=\u0027font-size:12.0pt;font-family:\"Times New Roman\";\r\nletter-spacing:-.05pt\u0027\u003e\u003co:p\u003e\u0026nbsp;\u003c/o:p\u003e\u003c/span\u003e\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027margin-bottom:0in;margin-bottom:.0001pt;text-align:\r\njustify;line-height:normal;mso-pagination:none;mso-layout-grid-align:none;\r\ntext-autospace:none\u0027\u003e\u003cspan style=\u0027font-size:12.0pt;font-family:\"Times New Roman\";\r\nletter-spacing:-.05pt\u0027\u003eBanking sector of Pakistan has experienced various ups \u003c/span\u003e\u003cspan\r\nstyle=\u0027font-size:12.0pt;font-family:\"Times New Roman\";letter-spacing:-.1pt\u0027\u003eand\r\ndowns. Before privatization banks were working under the \u003c/span\u003e\u003cspan\r\nstyle=\u0027font-size:12.0pt;font-family:\"Times New Roman\";letter-spacing:-.2pt\u0027\u003enationalized\r\nor State controlled framework. This framework was \u003c/span\u003e\u003cspan\r\nstyle=\u0027font-size:12.0pt;font-family:\"Times New Roman\"\u0027\u003eintroduced under the\r\nBanks (Nationalization) Act, 1974. Under \u003cspan style=\u0027letter-spacing:.55pt\u0027\u003ethis\r\nlegislation, all Bank deposits were protected by the \u003c/span\u003e\u003cspan\r\nstyle=\u0027letter-spacing:-.1pt\u0027\u003eGovernment. This system is also referred as\r\nimplicit protection \u003c/span\u003e\u003cspan style=\u0027letter-spacing:.05pt\u0027\u003esystem. This\r\nsystem has lost its meaning in a situation where \u003c/span\u003e\u003cspan style=\u0027letter-spacing:\r\n-.1pt\u0027\u003emost banks are now privately owned and even the largest State \u003c/span\u003e\u003cspan\r\nstyle=\u0027letter-spacing:.3pt\u0027\u003eowned bank. National Bank of Pakistan (NBP), has\r\nprivate \u003c/span\u003eshare-holders. Therefore, SBP has decided to form an explicit \u003cspan\r\nstyle=\u0027letter-spacing:.45pt\u0027\u003edeposit protection system under proposed law of\r\nDeposit \u003c/span\u003e\u003cspan style=\u0027letter-spacing:.2pt\u0027\u003eProtection Fund (DPF).\r\nExplicit system has formal and fixed \u003c/span\u003e\u003cspan style=\u0027letter-spacing:.1pt\u0027\u003erules\r\nand regulations. It will replace discretionary system with \u003c/span\u003e\u003cspan\r\nstyle=\u0027letter-spacing:-.05pt\u0027\u003ean established legal regimes DPF will be a\r\nseparate entity as a \u003c/span\u003e\u003cspan style=\u0027letter-spacing:.05pt\u0027\u003esubsidiary of\r\nthe State Bank of Pakistan (SBP).\u003csup\u003e7\u003c/sup\u003e This body will \u003c/span\u003e\u003cspan\r\nstyle=\u0027letter-spacing:.15pt\u0027\u003ebe formed under above said proposed law. Under\r\nsection 5 of \u003c/span\u003ethis law all scheduled banks under the State Bank of\r\nPakistan Act, 1956 shall compulsorily be members of the Fund. DPF will \u003cspan\r\nstyle=\u0027letter-spacing:.15pt\u0027\u003eonly be required to collect premium payments from\r\nmember \u003c/span\u003e\u003cspan style=\u0027letter-spacing:.05pt\u0027\u003efinancial institutions, verify\r\ndepositors\u0027 claim in case of bank \u003c/span\u003e\u003cspan style=\u0027letter-spacing:-.15pt\u0027\u003efailure\r\nand make payouts accordingly\u003csup\u003e8\u003c/sup\u003e.\u003co:p\u003e\u003c/o:p\u003e\u003c/span\u003e\u003c/span\u003e\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027margin-bottom:0in;margin-bottom:.0001pt;text-align:\r\njustify;line-height:normal;mso-pagination:none;mso-layout-grid-align:none;\r\ntext-autospace:none\u0027\u003e\u003cspan style=\u0027font-size:12.0pt;font-family:\"Times New Roman\";\r\nletter-spacing:.9pt\u0027\u003e\u003co:p\u003e\u0026nbsp;\u003c/o:p\u003e\u003c/span\u003e\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027margin-bottom:0in;margin-bottom:.0001pt;text-align:\r\njustify;line-height:normal;mso-pagination:none;mso-layout-grid-align:none;\r\ntext-autospace:none\u0027\u003e\u003cb\u003e\u003cspan style=\u0027font-size:12.0pt;font-family:\"Times New Roman\";\r\nletter-spacing:.9pt\u0027\u003eANALYSIS OF NEW LEGAL REGIME OF DEPOSIT \u003c/span\u003e\u003c/b\u003e\u003cb\u003e\u003cspan\r\nstyle=\u0027font-size:12.0pt;font-family:\"Times New Roman\"\u0027\u003ePROTECTION\u003co:p\u003e\u003c/o:p\u003e\u003c/span\u003e\u003c/b\u003e\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027margin-bottom:0in;margin-bottom:.0001pt;text-align:\r\njustify;line-height:normal;mso-pagination:none;mso-layout-grid-align:none;\r\ntext-autospace:none\u0027\u003e\u003cspan style=\u0027font-size:12.0pt;font-family:\"Times New Roman\";\r\nletter-spacing:.3pt\u0027\u003e\u003co:p\u003e\u0026nbsp;\u003c/o:p\u003e\u003c/span\u003e\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027margin-bottom:0in;margin-bottom:.0001pt;text-align:\r\njustify;line-height:normal;mso-pagination:none;mso-layout-grid-align:none;\r\ntext-autospace:none\u0027\u003e\u003cspan style=\u0027font-size:12.0pt;font-family:\"Times New Roman\";\r\nletter-spacing:.3pt\u0027\u003eAlmost all deposit protection laws around the world \u003c/span\u003e\u003cspan\r\nstyle=\u0027font-size:12.0pt;font-family:\"Times New Roman\";letter-spacing:.2pt\u0027\u003eplace\r\na limit on the protected deposit. It gives protection to \u003c/span\u003e\u003cspan\r\nstyle=\u0027font-size:12.0pt;font-family:\"Times New Roman\";letter-spacing:-.15pt\u0027\u003esmall\r\ndepositors and creates confidence. It also preserves some \u003c/span\u003e\u003cspan\r\nstyle=\u0027font-size:12.0pt;font-family:\"Times New Roman\";letter-spacing:.2pt\u0027\u003edegree\r\nof market discipline by exposing large depositors to \u003c/span\u003e\u003cspan\r\nstyle=\u0027font-size:12.0pt;font-family:\"Times New Roman\";letter-spacing:.05pt\u0027\u003epotential\r\nlosses. According to drafted law of DPF no such limit \u003c/span\u003e\u003cspan\r\nstyle=\u0027font-size:12.0pt;font-family:\"Times New Roman\";letter-spacing:-.05pt\u0027\u003eis\r\nthere and only there is promise of compensation to the extent of protected\r\ndeposits\u003csup\u003e9\u003c/sup\u003e. It also gives discretionary power to Fund \u003c/span\u003e\u003cspan\r\nstyle=\u0027font-size:12.0pt;font-family:\"Times New Roman\";letter-spacing:-.2pt\u0027\u003eto\r\ndecide the limit of protected deposits.\u003csup\u003e10\u003c/sup\u003eThis poses two m\u003csub\u003ea\u003c/sub\u003ei\u003csub\u003en\u003c/sub\u003e\r\nquestions on this law: Is the sole objective of such law to protect \u003c/span\u003e\u003cspan\r\nstyle=\u0027font-size:12.0pt;font-family:\"Times New Roman\";letter-spacing:.4pt\u0027\u003esmall\r\ndepositors in the event of bank failures? Or it al\u003csub\u003eso\u003c/sub\u003e \u003c/span\u003e\u003cspan\r\nstyle=\u0027font-size:12.0pt;font-family:\"Times New Roman\";letter-spacing:-.05pt\u0027\u003eproposes\r\nto protect large depositors. This promise makes th\u003csub\u003ee\u003c/sub\u003e \u003c/span\u003e\u003cspan\r\nstyle=\u0027font-size:12.0pt;font-family:\"Times New Roman\";letter-spacing:-.15pt\u0027\u003eobjective\r\nof this law unclear. In addition, section 20 relating t\u003csub\u003eo\u003c/sub\u003e determining\r\nthe size of deposits also makes this issue compl\u003csub\u003eex\u003c/sub\u003e \u003c/span\u003e\u003cspan\r\nstyle=\u0027font-size:12.0pt;font-family:\"Times New Roman\";letter-spacing:.45pt\u0027\u003ewhich\r\ndeals with total amount of member\u0027s liability to a \u003c/span\u003e\u003cspan\r\nstyle=\u0027font-size:12.0pt;font-family:\"Times New Roman\";letter-spacing:-.1pt\u0027\u003edepositor,\r\ncase of joint deposit, deposit in favour of third person \u003c/span\u003e\u003cspan\r\nstyle=\u0027font-size:12.0pt;font-family:\"Times New Roman\";letter-spacing:.2pt\u0027\u003eand\r\nencumbered deposits. This law protects all depositor\u003csub\u003es\u003c/sub\u003e \u003c/span\u003e\u003cspan\r\nstyle=\u0027font-size:12.0pt;font-family:\"Times New Roman\";letter-spacing:-.2pt\u0027\u003eexcept\r\nas provided in section 19. Protection of foreign currency \u003c/span\u003e\u003cspan\r\nstyle=\u0027font-size:12.0pt;font-family:\"Times New Roman\";letter-spacing:-.1pt\u0027\u003eaccounts\r\nalso places a question on this proposed law. It extends \u003c/span\u003e\u003cspan\r\nstyle=\u0027font-size:12.0pt;font-family:\"Times New Roman\";letter-spacing:.05pt\u0027\u003ethe\r\nscope of protection coverage. Various developed countries \u003c/span\u003e\u003cspan\r\nstyle=\u0027font-size:12.0pt;font-family:\"Times New Roman\";letter-spacing:.45pt\u0027\u003elike\r\nCanada do not protect foreign currency accounts to \u003c/span\u003e\u003cspan\r\nstyle=\u0027font-size:12.0pt;font-family:\"Times New Roman\";letter-spacing:-.05pt\u0027\u003eenhance\r\nthe value of national currency.\u0026quot; In addition, default is \u003c/span\u003e\u003cspan\r\nstyle=\u0027font-size:12.0pt;font-family:\"Times New Roman\"\u0027\u003enot only the situation\r\nwhen depositors will be protected under \u003cspan style=\u0027letter-spacing:.05pt\u0027\u003ethis\r\nlaw. Depositors can be protected when normal operations \u003c/span\u003e\u003cspan\r\nstyle=\u0027letter-spacing:.1pt\u0027\u003eof a member has been closed or suspended as result\r\nof any \u003c/span\u003ejudicial or regulatory action.\u003csup\u003e12\u003c/sup\u003e SBP will issue a\r\nnotification in \u003cspan style=\u0027letter-spacing:-.1pt\u0027\u003ethis respect.\u003csup\u003e13\u003c/sup\u003e\u003c/span\u003e\u003cspan\r\nstyle=\u0027letter-spacing:-.05pt\u0027\u003e\u003co:p\u003e\u003c/o:p\u003e\u003c/span\u003e\u003c/span\u003e\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027margin-bottom:0in;margin-bottom:.0001pt;text-align:\r\njustify;line-height:normal;mso-pagination:none;mso-layout-grid-align:none;\r\ntext-autospace:none\u0027\u003e\u003cspan style=\u0027font-size:12.0pt;font-family:\"Times New Roman\";\r\nletter-spacing:.35pt\u0027\u003eUnder this draft law, DPF will be a body corporate \u003c/span\u003e\u003cspan\r\nstyle=\u0027font-size:12.0pt;font-family:\"Times New Roman\";letter-spacing:.2pt\u0027\u003esubsidiary\r\nof SBP. There will be five members in the board \u003c/span\u003e\u003cspan style=\u0027font-size:\r\n12.0pt;font-family:\"Times New Roman\";letter-spacing:.35pt\u0027\u003eincluding\r\nChairman.\u0026quot; Deputy Governor of SBP will act as \u003c/span\u003e\u003cspan\r\nstyle=\u0027font-size:12.0pt;font-family:\"Times New Roman\";letter-spacing:-.2pt\u0027\u003eChairman\r\nof Board and three other Board appointments will be \u003c/span\u003e\u003cspan\r\nstyle=\u0027font-size:12.0pt;font-family:\"Times New Roman\";letter-spacing:.05pt\u0027\u003emade\r\nby Central Board of SBP. Fifth member as a Managing \u003c/span\u003e\u003cspan\r\nstyle=\u0027font-size:12.0pt;font-family:\"Times New Roman\";letter-spacing:.4pt\u0027\u003eDirector\r\nof Fund shall be appointed by Board of Fund.I\u003csup\u003e5\u003c/sup\u003e \u003c/span\u003e\u003cspan\r\nstyle=\u0027font-size:12.0pt;font-family:\"Times New Roman\"\u0027\u003eAccording to section 11\r\nof this proposed law any employee or \u003cspan style=\u0027letter-spacing:.1pt\u0027\u003eBoard\r\nMember of SBP can be appointed as Board member in \u003c/span\u003e\u003cspan\r\nstyle=\u0027letter-spacing:-.25pt\u0027\u003ethe Fund which is totally discretionary authority\r\nof SBP without \u003c/span\u003e\u003cspan style=\u0027letter-spacing:.05pt\u0027\u003ementioning any\r\nqualification for such appointments, term of \u003c/span\u003e\u003cspan style=\u0027letter-spacing:\r\n-.25pt\u0027\u003eoffice and termination of such member.\u003csup\u003e18\u003c/sup\u003e This can create\r\nmajor \u003c/span\u003e\u003cspan style=\u0027letter-spacing:-.15pt\u0027\u003egovernance issues and conflict\r\nof interests because at the same \u003c/span\u003e\u003cspan style=\u0027letter-spacing:.4pt\u0027\u003etime\r\nthese members will act as regulator under SBP and \u003c/span\u003eManager of Fund. In\r\naddition SBP\u0027s power to issue direction to \u003cspan style=\u0027letter-spacing:-.25pt\u0027\u003eBoard\r\nunder this law\u003csup\u003e17\u003c/sup\u003e can create serious problems in corporate \u003c/span\u003egovernance\r\nof Fund. Therefore, there is need to remove these \u003cspan style=\u0027letter-spacing:\r\n.9pt\u0027\u003eprovisions and to include provision of Non-executive \u003c/span\u003e\u003cspan\r\nstyle=\u0027letter-spacing:.15pt\u0027\u003eIndependent Directors\u0027 (NEDs) appointment in the\r\nBoard to \u003c/span\u003e\u003cspan style=\u0027letter-spacing:.8pt\u0027\u003eeliminate such conflict of\r\ninterest. Code of Corporate \u003c/span\u003e\u003cspan style=\u0027letter-spacing:.7pt\u0027\u003eGovernance\r\n(CCG)\u003csup\u003e18\u003c/sup\u003eissued by SECP and Hand Book of \u003c/span\u003e\u003cspan\r\nstyle=\u0027letter-spacing:-.2pt\u0027\u003eCorporate Governance (HBCG)\u003csup\u003e19\u003c/sup\u003e issued by\r\nSBP also encourages \u003c/span\u003e\u003cspan style=\u0027letter-spacing:.1pt\u0027\u003eNEDs appointments.\r\nAuthority to form various committees in \u003c/span\u003e\u003cspan style=\u0027letter-spacing:\r\n-.05pt\u0027\u003ethe Board has also been given under the discretionary authority \u003c/span\u003e\u003cspan\r\nstyle=\u0027letter-spacing:-.2pt\u0027\u003eof Board which is against CCG in which specific\r\ncommittees are \u003c/span\u003erequired.\u003co:p\u003e\u003c/o:p\u003e\u003c/span\u003e\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027margin-bottom:0in;margin-bottom:.0001pt;text-align:\r\njustify;line-height:normal;mso-pagination:none;mso-layout-grid-align:none;\r\ntext-autospace:none\u0027\u003e\u003cspan style=\u0027font-size:12.0pt;font-family:\"Times New Roman\";\r\nletter-spacing:.05pt\u0027\u003e\u003co:p\u003e\u0026nbsp;\u003c/o:p\u003e\u003c/span\u003e\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027margin-bottom:0in;margin-bottom:.0001pt;text-align:\r\njustify;line-height:normal;mso-pagination:none;mso-layout-grid-align:none;\r\ntext-autospace:none\u0027\u003e\u003cspan style=\u0027font-size:12.0pt;font-family:\"Times New Roman\";\r\nletter-spacing:.05pt\u0027\u003eThere is also need to decide on what basis premium will \u003c/span\u003e\u003cspan\r\nstyle=\u0027font-size:12.0pt;font-family:\"Times New Roman\";letter-spacing:.45pt\u0027\u003ebe\r\ncollected in the fund? Whether risk-based or flat-rate \u003c/span\u003e\u003cspan\r\nstyle=\u0027font-size:12.0pt;font-family:\"Times New Roman\"\u0027\u003epremium will be imposed\r\non member institutions. Risk-based \u003cspan style=\u0027letter-spacing:-.1pt\u0027\u003epremium\r\nare also called varying premiums which are collected \u003c/span\u003eaccording to level\r\nof risk taken by financial institution. On the \u003cspan style=\u0027letter-spacing:\r\n-.05pt\u0027\u003eother hand flat-rate premiums are also called simple premium \u003c/span\u003e\u003cspan\r\nstyle=\u0027letter-spacing:-.1pt\u0027\u003ewhich are applied on the same assessment rate on\r\nall member \u003c/span\u003e\u003cspan style=\u0027letter-spacing:.05pt\u0027\u003eInstitutions. It can be\r\ninadequate like in the Philippine where \u003c/span\u003e\u003cspan style=\u0027letter-spacing:\r\n-.15pt\u0027\u003efund showed inadequate resources to meet requirements in the \u003c/span\u003e\u003cspan\r\nstyle=\u0027letter-spacing:.15pt\u0027\u003ebanking failures in 1984 to 1988. Therefore;\r\npremium should \u003c/span\u003ebe varying depending on the overall riskiness of bank.\r\nThis law \u003cspan style=\u0027letter-spacing:-.25pt\u0027\u003ealso does not indicate whether\r\ngovernment wall share the cost of \u003c/span\u003e\u003cspan style=\u0027letter-spacing:.5pt\u0027\u003edeposit\r\nprotection. In India, Nigeria and Philippines, for \u003c/span\u003e\u003cspan\r\nstyle=\u0027letter-spacing:-.2pt\u0027\u003eexample, the government made an initial capital\r\ncontribution to \u003c/span\u003e\u003cspan style=\u0027letter-spacing:.4pt\u0027\u003einsurance fund in\r\norder to give system creditability\u003csup\u003e20\u003c/sup\u003e. In \u003c/span\u003e\u003cspan\r\nstyle=\u0027letter-spacing:.75pt\u0027\u003eSpain, the Government makes regular payment in the\r\n\u003c/span\u003e\u003cspan style=\u0027letter-spacing:-.1pt\u0027\u003efund\u003csup\u003e21\u003c/sup\u003e.\u003co:p\u003e\u003c/o:p\u003e\u003c/span\u003e\u003c/span\u003e\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027margin-bottom:0in;margin-bottom:.0001pt;text-align:\r\njustify;line-height:normal;mso-pagination:none;mso-layout-grid-align:none;\r\ntext-autospace:none\u0027\u003e\u003cspan style=\u0027font-size:12.0pt;font-family:\"Times New Roman\";\r\nletter-spacing:.2pt\u0027\u003e\u003co:p\u003e\u0026nbsp;\u003c/o:p\u003e\u003c/span\u003e\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027margin-bottom:0in;margin-bottom:.0001pt;text-align:\r\njustify;line-height:normal;mso-pagination:none;mso-layout-grid-align:none;\r\ntext-autospace:none\u0027\u003e\u003cspan style=\u0027font-size:12.0pt;font-family:\"Times New Roman\";\r\nletter-spacing:.2pt\u0027\u003eAccording to section 25 of this proposed law, it is the\r\nduty of every person as public servant in service of fund to \u003c/span\u003e\u003cspan\r\nstyle=\u0027font-size:12.0pt;font-family:\"Times New Roman\";letter-spacing:-.1pt\u0027\u003emaintain\r\nthe secrecy relating to matters of fund\u003csup\u003e22\u003c/sup\u003e. If any person \u003c/span\u003e\u003cspan\r\nstyle=\u0027font-size:12.0pt;font-family:\"Times New Roman\"\u0027\u003efails to do so section\r\n25(2) of this proposed law provides limit of \u003cspan style=\u0027letter-spacing:-.1pt\u0027\u003epecuniary\r\nas well as penal punishment. But it does not provide, \u003c/span\u003e\u003cspan\r\nstyle=\u0027letter-spacing:.1pt\u0027\u003ewhat forum has jurisdiction to punish such person?\r\nThis draft \u003c/span\u003e\u003cspan style=\u0027letter-spacing:.05pt\u0027\u003eof law also limits the\r\nauthority of Courts (including lower and superior Court), tribunal or other\r\nauthority to not compel the \u003c/span\u003eproduction of any unpublished records. This\r\nprovision has very \u003cspan style=\u0027letter-spacing:.4pt\u0027\u003ewide scope, which put a\r\nquestion mark on rule of law and \u003c/span\u003e\u003cspan style=\u0027letter-spacing:.35pt\u0027\u003eauthority\r\nof superior Courts relating to public interests in \u003c/span\u003e\u003cspan\r\nstyle=\u0027letter-spacing:.05pt\u0027\u003ePakistan. In addition section 30 of said law also\r\nrestricts Courts \u003c/span\u003e\u003cspan style=\u0027letter-spacing:.3pt\u0027\u003eto attach pension of\r\nany Fund employees by process of any \u003c/span\u003eCourt. These provisions can provide\r\nopen holes of corruption in this Fund. Sections 28 and 37 under this proposed\r\nlaw are \u003cspan style=\u0027letter-spacing:.45pt\u0027\u003econtradictory in nature because\r\nsection 28 indicates that \u003c/span\u003e\u003cspan style=\u0027letter-spacing:.8pt\u0027\u003esection 58,\r\nsubsections (1), (2), (3), (4) of the Banking \u003c/span\u003e\u003cspan style=\u0027letter-spacing:\r\n.7pt\u0027\u003eCompanies Ordinance, 1962 will be followed in priority \u003c/span\u003e\u003cspan\r\nstyle=\u0027letter-spacing:.15pt\u0027\u003epayments. But on the other hand section 37 clearly\r\nmentions \u003c/span\u003e\u003cspan style=\u0027letter-spacing:.25pt\u0027\u003ethat the Banking Companies\r\nOrdinance shall not , apply to \u003c/span\u003eFund. There is need to resolve this\r\ncontradiction.\u003co:p\u003e\u003c/o:p\u003e\u003c/span\u003e\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027margin-bottom:0in;margin-bottom:.0001pt;text-align:\r\njustify;line-height:normal;mso-pagination:none;mso-layout-grid-align:none;\r\ntext-autospace:none\u0027\u003e\u003cspan style=\u0027font-size:12.0pt;font-family:\"Times New Roman\"\u0027\u003e\u003co:p\u003e\u0026nbsp;\u003c/o:p\u003e\u003c/span\u003e\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027margin-bottom:0in;margin-bottom:.0001pt;text-align:\r\njustify;line-height:normal;mso-pagination:none;mso-layout-grid-align:none;\r\ntext-autospace:none\u0027\u003e\u003cb\u003e\u003cspan style=\u0027font-size:12.0pt;font-family:\"Times New Roman\"\u0027\u003eConclusion:\u003co:p\u003e\u003c/o:p\u003e\u003c/span\u003e\u003c/b\u003e\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027margin-bottom:0in;margin-bottom:.0001pt;text-align:\r\njustify;line-height:normal;mso-pagination:none;mso-layout-grid-align:none;\r\ntext-autospace:none\u0027\u003e\u003cspan style=\u0027font-size:12.0pt;font-family:\"Times New Roman\"\u0027\u003e\u003co:p\u003e\u0026nbsp;\u003c/o:p\u003e\u003c/span\u003e\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027margin-bottom:0in;margin-bottom:.0001pt;text-align:\r\njustify;line-height:normal;mso-pagination:none;mso-layout-grid-align:none;\r\ntext-autospace:none\u0027\u003e\u003cspan style=\u0027font-size:12.0pt;font-family:\"Times New Roman\"\u0027\u003eIn\r\nthe light of above discussion, we can say intention to \u003cspan style=\u0027letter-spacing:\r\n.45pt\u0027\u003eform this law is very positive to create confidence among \u003c/span\u003e\u003cspan\r\nstyle=\u0027letter-spacing:.3pt\u0027\u003edepositors. But there is need to make this law very\r\nsimple \u003c/span\u003e\u003cspan style=\u0027letter-spacing:-.15pt\u0027\u003ebecause this law is directly\r\nrelating to public interest. There are \u003c/span\u003e\u003cspan style=\u0027letter-spacing:.05pt\u0027\u003evarious\r\nloopholes in this law where elements of corruption can \u003c/span\u003e\u003cspan\r\nstyle=\u0027letter-spacing:.4pt\u0027\u003ebe born. Questions relating to limit of protection,\r\nlevel of \u003c/span\u003e\u003cspan style=\u0027letter-spacing:-.15pt\u0027\u003epremium, governance\r\nstructure and power of Courts need to be \u003c/span\u003e\u003cspan style=\u0027letter-spacing:\r\n-.2pt\u0027\u003eanswered. The deposit protection law should not be viewed as a \u003c/span\u003e\u003cspan\r\nstyle=\u0027letter-spacing:-.05pt\u0027\u003esubstitute for adequate regulation and\r\nsupervision. Therefore, \u003c/span\u003e\u003cspan style=\u0027letter-spacing:.05pt\u0027\u003eimproved\r\nregulation supervision will be necessary to overcome \u003c/span\u003ethe moral hazards,\r\nwhich can be created on the introduction of this deposit protection law.\u003co:p\u003e\u003c/o:p\u003e\u003c/span\u003e\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027margin-bottom:0in;margin-bottom:.0001pt;text-align:\r\njustify;line-height:normal;mso-pagination:none;mso-layout-grid-align:none;\r\ntext-autospace:none\u0027\u003e\u003cspan style=\u0027font-size:12.0pt;font-family:\"Times New Roman\";\r\nletter-spacing:-.1pt\u0027\u003e\u003co:p\u003e\u0026nbsp;\u003c/o:p\u003e\u003c/span\u003e\u003c/p\u003e\r\n\r\n\u003cdiv style=\u0027mso-element:para-border-div;border:none;border-bottom:solid windowtext 1.5pt;\r\npadding:0in 0in 1.0pt 0in\u0027\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027margin-bottom:0in;margin-bottom:.0001pt;text-align:\r\njustify;line-height:normal;mso-pagination:none;mso-layout-grid-align:none;\r\ntext-autospace:none;border:none;mso-border-bottom-alt:solid windowtext 1.5pt;\r\npadding:0in;mso-padding-alt:0in 0in 1.0pt 0in\u0027\u003e\u003cspan style=\u0027font-size:12.0pt;\r\nfont-family:\"Times New Roman\";letter-spacing:-.1pt\u0027\u003e\u003co:p\u003e\u0026nbsp;\u003c/o:p\u003e\u003c/span\u003e\u003c/p\u003e\r\n\r\n\u003c/div\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027margin-bottom:0in;margin-bottom:.0001pt;text-align:\r\njustify;line-height:normal;mso-pagination:none;mso-layout-grid-align:none;\r\ntext-autospace:none\u0027\u003e\u003cspan style=\u0027font-size:12.0pt;font-family:\"Times New Roman\";\r\nletter-spacing:-.1pt\u0027\u003e\u003co:p\u003e\u0026nbsp;\u003c/o:p\u003e\u003c/span\u003e\u003c/p\u003e\r\n\r\n\u003cp class=ListParagraph style=\u0027text-align:justify;text-indent:-.25in;mso-list:\r\nl0 level1 lfo1\u0027\u003e\u003c![if !supportLists]\u003e\u003cspan style=\u0027color:#0000CC;letter-spacing:\r\n.2pt\u0027\u003e\u003cspan style=\u0027mso-list:Ignore\u0027\u003e1.\u003cspan style=\u0027font:7.0pt \"Times New Roman\"\u0027\u003e\u0026nbsp;\u0026nbsp;\u0026nbsp;\u0026nbsp;\u0026nbsp;\r\n\u003c/span\u003e\u003c/span\u003e\u003c/span\u003e\u003c![endif]\u003e\u003cspan style=\u0027color:#0000CC;letter-spacing:.2pt\u0027\u003eSebastian\r\nSchich (July, 2008). \u0026quot;Financial turbulence: Some lessons regarding deposit\r\ninsurance\u0026quot;. Financial Markets trends. OECD, at \u003c/span\u003e\u003cspan\r\nstyle=\u0027color:#0000CC\u0027\u003ePage 59 http: /\u003ca href=\"http://www.oecd.org/dataoecd/32/\"\u003e\u003cspan\r\nstyle=\u0027color:#0000CC;text-decoration:none;text-underline:none\u0027\u003ewww.oecd.org/dataoecd\r\n/32/\u003c/span\u003e\u003c/a\u003e 54 /41420525.pdf.\u003cspan style=\u0027letter-spacing:.2pt\u0027\u003e\u003co:p\u003e\u003c/o:p\u003e\u003c/span\u003e\u003c/span\u003e\u003c/p\u003e\r\n\r\n\u003cp class=ListParagraph style=\u0027text-align:justify\u0027\u003e\u003cspan style=\u0027color:#0000CC;\r\nletter-spacing:.2pt\u0027\u003e\u003co:p\u003e\u0026nbsp;\u003c/o:p\u003e\u003c/span\u003e\u003c/p\u003e\r\n\r\n\u003cp class=ListParagraph style=\u0027text-align:justify;text-indent:-.25in;mso-list:\r\nl0 level1 lfo1\u0027\u003e\u003c![if !supportLists]\u003e\u003cspan style=\u0027color:#0000CC;letter-spacing:\r\n.2pt\u0027\u003e\u003cspan style=\u0027mso-list:Ignore\u0027\u003e2.\u003cspan style=\u0027font:7.0pt \"Times New Roman\"\u0027\u003e\u0026nbsp;\u0026nbsp;\u0026nbsp;\u0026nbsp;\u0026nbsp;\r\n\u003c/span\u003e\u003c/span\u003e\u003c/span\u003e\u003c![endif]\u003e\u003cspan style=\u0027color:#0000CC;letter-spacing:.1pt\u0027\u003eSBP,\r\nTen year policy strategy for banking sector reforms, at Page 30, \u003c/span\u003e\u003cspan\r\nstyle=\u0027color:#0000CC;letter-spacing:.05pt\u0027\u003eavailable at http: / \u003c/span\u003e\u003cspan\r\nstyle=\u0027color:#0000CC\u0027\u003e\u003ca\r\nhref=\"http://iwww.sbp.org.pk/bsd/10YearStrategvPaper.pdf.\"\u003e\u003cspan\r\nstyle=\u0027color:#0000CC;letter-spacing:.05pt;text-decoration:none;text-underline:\r\nnone\u0027\u003eiwww.sbp.org.pk/bsd/10YearStrategvPaper.pdf.\u003c/span\u003e\u003c/a\u003e\u003cspan\r\nstyle=\u0027letter-spacing:.2pt\u0027\u003e\u003co:p\u003e\u003c/o:p\u003e\u003c/span\u003e\u003c/span\u003e\u003c/p\u003e\r\n\r\n\u003cp class=ListParagraph\u003e\u003cspan style=\u0027color:#0000CC\u0027\u003e\u003co:p\u003e\u0026nbsp;\u003c/o:p\u003e\u003c/span\u003e\u003c/p\u003e\r\n\r\n\u003cp class=ListParagraph style=\u0027text-align:justify;text-indent:-.25in;mso-list:\r\nl0 level1 lfo1\u0027\u003e\u003c![if !supportLists]\u003e\u003cspan style=\u0027color:#0000CC;letter-spacing:\r\n.2pt\u0027\u003e\u003cspan style=\u0027mso-list:Ignore\u0027\u003e3.\u003cspan style=\u0027font:7.0pt \"Times New Roman\"\u0027\u003e\u0026nbsp;\u0026nbsp;\u0026nbsp;\u0026nbsp;\u0026nbsp;\r\n\u003c/span\u003e\u003c/span\u003e\u003c/span\u003e\u003c![endif]\u003e\u003cspan style=\u0027color:#0000CC\u0027\u003eIbid.\u003cspan\r\nstyle=\u0027letter-spacing:.2pt\u0027\u003e\u003co:p\u003e\u003c/o:p\u003e\u003c/span\u003e\u003c/span\u003e\u003c/p\u003e\r\n\r\n\u003cp class=ListParagraph\u003e\u003cspan style=\u0027color:#0000CC;letter-spacing:.25pt\u0027\u003e\u003co:p\u003e\u0026nbsp;\u003c/o:p\u003e\u003c/span\u003e\u003c/p\u003e\r\n\r\n\u003cp class=ListParagraph style=\u0027text-align:justify;text-indent:-.25in;mso-list:\r\nl0 level1 lfo1\u0027\u003e\u003c![if !supportLists]\u003e\u003cspan style=\u0027color:#0000CC;letter-spacing:\r\n.2pt\u0027\u003e\u003cspan style=\u0027mso-list:Ignore\u0027\u003e4.\u003cspan style=\u0027font:7.0pt \"Times New Roman\"\u0027\u003e\u0026nbsp;\u0026nbsp;\u0026nbsp;\u0026nbsp;\u0026nbsp;\r\n\u003c/span\u003e\u003c/span\u003e\u003c/span\u003e\u003c![endif]\u003e\u003cspan style=\u0027color:#0000CC;letter-spacing:.25pt\u0027\u003eA.\r\nDeming et al, Does Deposit Insurance Increase Banking System \u003c/span\u003e\u003cspan\r\nstyle=\u0027color:#0000CC;letter-spacing:.55pt\u0027\u003eStability? An Empirical\r\nInvestigation, at Page 2, available at \u003c/span\u003e\u003cspan style=\u0027color:#0000CC;\r\nletter-spacing:-.1pt\u0027\u003ewww.1.worldbank.oro/finance /assets/images/depins08.pdf.\u003c/span\u003e\u003cspan\r\nstyle=\u0027color:#0000CC;letter-spacing:.2pt\u0027\u003e\u003co:p\u003e\u003c/o:p\u003e\u003c/span\u003e\u003c/p\u003e\r\n\r\n\u003cp class=ListParagraph\u003e\u003cspan style=\u0027color:#0000CC;letter-spacing:.3pt\u0027\u003e\u003co:p\u003e\u0026nbsp;\u003c/o:p\u003e\u003c/span\u003e\u003c/p\u003e\r\n\r\n\u003cp class=ListParagraph style=\u0027text-align:justify;text-indent:-.25in;mso-list:\r\nl0 level1 lfo1\u0027\u003e\u003c![if !supportLists]\u003e\u003cspan style=\u0027color:#0000CC;letter-spacing:\r\n.2pt\u0027\u003e\u003cspan style=\u0027mso-list:Ignore\u0027\u003e5.\u003cspan style=\u0027font:7.0pt \"Times New Roman\"\u0027\u003e\u0026nbsp;\u0026nbsp;\u0026nbsp;\u0026nbsp;\u0026nbsp;\r\n\u003c/span\u003e\u003c/span\u003e\u003c/span\u003e\u003c![endif]\u003e\u003cspan style=\u0027color:#0000CC;letter-spacing:.3pt\u0027\u003eP.\r\nEllinger et al, Ellinger\u0027s Modern Banking Law, 4th Ed., Oxford:\u003c/span\u003e\u003cspan\r\nstyle=\u0027color:#0000CC;letter-spacing:.2pt\u0027\u003e\u003co:p\u003e\u003c/o:p\u003e\u003c/span\u003e\u003c/p\u003e\r\n\r\n\u003cp class=ListParagraph\u003e\u003cspan style=\u0027color:#0000CC;letter-spacing:.35pt\u0027\u003e\u003co:p\u003e\u0026nbsp;\u003c/o:p\u003e\u003c/span\u003e\u003c/p\u003e\r\n\r\n\u003cp class=ListParagraph style=\u0027text-align:justify;text-indent:-.25in;mso-list:\r\nl0 level1 lfo1\u0027\u003e\u003c![if !supportLists]\u003e\u003cspan style=\u0027color:#0000CC\u0027\u003e\u003cspan\r\nstyle=\u0027mso-list:Ignore\u0027\u003e6.\u003cspan style=\u0027font:7.0pt \"Times New Roman\"\u0027\u003e\u0026nbsp;\u0026nbsp;\u0026nbsp;\u0026nbsp;\u0026nbsp;\r\n\u003c/span\u003e\u003c/span\u003e\u003c/span\u003e\u003c![endif]\u003e\u003cspan style=\u0027color:#0000CC;letter-spacing:.35pt\u0027\u003eDraft\r\nDeposit Protection Fund (DPF) Act, Section 39, available.\u003c/span\u003e\u003cspan\r\nstyle=\u0027color:#0000CC\u0027\u003e\u003co:p\u003e\u003c/o:p\u003e\u003c/span\u003e\u003c/p\u003e\r\n\r\n\u003cp class=ListParagraph\u003e\u003cspan style=\u0027color:#0000CC\u0027\u003e\u003co:p\u003e\u0026nbsp;\u003c/o:p\u003e\u003c/span\u003e\u003c/p\u003e\r\n\r\n\u003cp class=ListParagraph style=\u0027text-align:justify;text-indent:-.25in;mso-list:\r\nl0 level1 lfo1\u0027\u003e\u003c![if !supportLists]\u003e\u003cspan style=\u0027color:#0000CC\u0027\u003e\u003cspan\r\nstyle=\u0027mso-list:Ignore\u0027\u003e7.\u003cspan style=\u0027font:7.0pt \"Times New Roman\"\u0027\u003e\u0026nbsp;\u0026nbsp;\u0026nbsp;\u0026nbsp;\u0026nbsp;\r\n\u003c/span\u003e\u003c/span\u003e\u003c/span\u003e\u003c![endif]\u003e\u003cspan style=\u0027color:#0000CC\u0027\u003eIbid. section 4.\u003co:p\u003e\u003c/o:p\u003e\u003c/span\u003e\u003c/p\u003e\r\n\r\n\u003cp class=ListParagraph\u003e\u003cspan style=\u0027color:#0000CC\u0027\u003e\u003co:p\u003e\u0026nbsp;\u003c/o:p\u003e\u003c/span\u003e\u003c/p\u003e\r\n\r\n\u003cp class=ListParagraph style=\u0027text-align:justify;text-indent:-.25in;mso-list:\r\nl0 level1 lfo1\u0027\u003e\u003c![if !supportLists]\u003e\u003cspan style=\u0027color:#0000CC\u0027\u003e\u003cspan\r\nstyle=\u0027mso-list:Ignore\u0027\u003e8.\u003cspan style=\u0027font:7.0pt \"Times New Roman\"\u0027\u003e\u0026nbsp;\u0026nbsp;\u0026nbsp;\u0026nbsp;\u0026nbsp;\r\n\u003c/span\u003e\u003c/span\u003e\u003c/span\u003e\u003c![endif]\u003e\u003cspan style=\u0027color:#0000CC\u0027\u003eSee supra n.2, at\r\np.30.\u003co:p\u003e\u003c/o:p\u003e\u003c/span\u003e\u003c/p\u003e\r\n\r\n\u003cp class=ListParagraph\u003e\u003cspan style=\u0027color:#0000CC\u0027\u003e\u003co:p\u003e\u0026nbsp;\u003c/o:p\u003e\u003c/span\u003e\u003c/p\u003e\r\n\r\n\u003cp class=ListParagraph style=\u0027text-align:justify;text-indent:-.25in;mso-list:\r\nl0 level1 lfo1\u0027\u003e\u003c![if !supportLists]\u003e\u003cspan style=\u0027color:#0000CC\u0027\u003e\u003cspan\r\nstyle=\u0027mso-list:Ignore\u0027\u003e9.\u003cspan style=\u0027font:7.0pt \"Times New Roman\"\u0027\u003e\u0026nbsp;\u0026nbsp;\u0026nbsp;\u0026nbsp;\u0026nbsp;\r\n\u003c/span\u003e\u003c/span\u003e\u003c/span\u003e\u003c![endif]\u003e\u003cspan style=\u0027color:#0000CC\u0027\u003eSee supra n.6,\r\nsection 5\u003co:p\u003e\u003c/o:p\u003e\u003c/span\u003e\u003c/p\u003e\r\n\r\n\u003cp class=ListParagraph\u003e\u003cspan style=\u0027color:#0000CC\u0027\u003e\u003co:p\u003e\u0026nbsp;\u003c/o:p\u003e\u003c/span\u003e\u003c/p\u003e\r\n\r\n\u003cp class=ListParagraph style=\u0027text-align:justify;text-indent:-.25in;mso-list:\r\nl0 level1 lfo1\u0027\u003e\u003c![if !supportLists]\u003e\u003cspan style=\u0027color:#0000CC\u0027\u003e\u003cspan\r\nstyle=\u0027mso-list:Ignore\u0027\u003e10.\u003cspan style=\u0027font:7.0pt \"Times New Roman\"\u0027\u003e\u0026nbsp; \u003c/span\u003e\u003c/span\u003e\u003c/span\u003e\u003c![endif]\u003e\u003cspan\r\nstyle=\u0027color:#0000CC\u0027\u003eSee supra n.6, section 18\u003co:p\u003e\u003c/o:p\u003e\u003c/span\u003e\u003c/p\u003e\r\n\r\n\u003cp class=ListParagraph\u003e\u003cspan style=\u0027color:#0000CC;letter-spacing:.25pt\u0027\u003e\u003co:p\u003e\u0026nbsp;\u003c/o:p\u003e\u003c/span\u003e\u003c/p\u003e\r\n\r\n\u003cp class=ListParagraph style=\u0027text-align:justify;text-indent:-.25in;mso-list:\r\nl0 level1 lfo1\u0027\u003e\u003c![if !supportLists]\u003e\u003cspan style=\u0027color:#0000CC\u0027\u003e\u003cspan\r\nstyle=\u0027mso-list:Ignore\u0027\u003e11.\u003cspan style=\u0027font:7.0pt \"Times New Roman\"\u0027\u003e\u0026nbsp; \u003c/span\u003e\u003c/span\u003e\u003c/span\u003e\u003c![endif]\u003e\u003cspan\r\nstyle=\u0027color:#0000CC;letter-spacing:.25pt\u0027\u003eDeposit Insurance, available at \u0026lt;\u003c/span\u003e\u003cspan\r\nstyle=\u0027color:#0000CC\u0027\u003e\u003ca href=\"http://en.wikipedia.org/wildi\"\u003e\u003cspan\r\nstyle=\u0027color:#0000CC;letter-spacing:.25pt;text-decoration:none;text-underline:\r\nnone\u0027\u003ehttp://en.wikipedia.org/wildi\u003c/span\u003e\u003c/a\u003e\u003cspan style=\u0027letter-spacing:.25pt\u0027\u003e\r\n\u003c/span\u003eDeposit-insurance\u0026gt;\u003co:p\u003e\u003c/o:p\u003e\u003c/span\u003e\u003c/p\u003e\r\n\r\n\u003cp class=ListParagraph\u003e\u003cspan style=\u0027color:#0000CC\u0027\u003e\u003co:p\u003e\u0026nbsp;\u003c/o:p\u003e\u003c/span\u003e\u003c/p\u003e\r\n\r\n\u003cp class=ListParagraph style=\u0027text-align:justify;text-indent:-.25in;mso-list:\r\nl0 level1 lfo1\u0027\u003e\u003c![if !supportLists]\u003e\u003cspan style=\u0027color:#0000CC\u0027\u003e\u003cspan\r\nstyle=\u0027mso-list:Ignore\u0027\u003e12.\u003cspan style=\u0027font:7.0pt \"Times New Roman\"\u0027\u003e\u0026nbsp; \u003c/span\u003e\u003c/span\u003e\u003c/span\u003e\u003c![endif]\u003e\u003cspan\r\nstyle=\u0027color:#0000CC\u0027\u003eSee supra n.6, section 21\u003co:p\u003e\u003c/o:p\u003e\u003c/span\u003e\u003c/p\u003e\r\n\r\n\u003cp class=ListParagraph\u003e\u003cspan style=\u0027color:#0000CC\u0027\u003e\u003co:p\u003e\u0026nbsp;\u003c/o:p\u003e\u003c/span\u003e\u003c/p\u003e\r\n\r\n\u003cp class=ListParagraph style=\u0027text-align:justify;text-indent:-.25in;mso-list:\r\nl0 level1 lfo1\u0027\u003e\u003c![if !supportLists]\u003e\u003cspan style=\u0027color:#0000CC\u0027\u003e\u003cspan\r\nstyle=\u0027mso-list:Ignore\u0027\u003e13.\u003cspan style=\u0027font:7.0pt \"Times New Roman\"\u0027\u003e\u0026nbsp; \u003c/span\u003e\u003c/span\u003e\u003c/span\u003e\u003c![endif]\u003e\u003cspan\r\nstyle=\u0027color:#0000CC\u0027\u003eIbid.\u003co:p\u003e\u003c/o:p\u003e\u003c/span\u003e\u003c/p\u003e\r\n\r\n\u003cp class=ListParagraph\u003e\u003cspan style=\u0027color:#0000CC\u0027\u003e\u003co:p\u003e\u0026nbsp;\u003c/o:p\u003e\u003c/span\u003e\u003c/p\u003e\r\n\r\n\u003cp class=ListParagraph style=\u0027text-align:justify;text-indent:-.25in;mso-list:\r\nl0 level1 lfo1\u0027\u003e\u003c![if !supportLists]\u003e\u003cspan style=\u0027color:#0000CC\u0027\u003e\u003cspan\r\nstyle=\u0027mso-list:Ignore\u0027\u003e14.\u003cspan style=\u0027font:7.0pt \"Times New Roman\"\u0027\u003e\u0026nbsp; \u003c/span\u003e\u003c/span\u003e\u003c/span\u003e\u003c![endif]\u003e\u003cspan\r\nstyle=\u0027color:#0000CC\u0027\u003eSee supra n.6, section 8\u003co:p\u003e\u003c/o:p\u003e\u003c/span\u003e\u003c/p\u003e\r\n\r\n\u003cp class=ListParagraph\u003e\u003cspan style=\u0027color:#0000CC\u0027\u003e\u003co:p\u003e\u0026nbsp;\u003c/o:p\u003e\u003c/span\u003e\u003c/p\u003e\r\n\r\n\u003cp class=ListParagraph style=\u0027text-align:justify;text-indent:-.25in;mso-list:\r\nl0 level1 lfo1\u0027\u003e\u003c![if !supportLists]\u003e\u003cspan style=\u0027color:#0000CC\u0027\u003e\u003cspan\r\nstyle=\u0027mso-list:Ignore\u0027\u003e15.\u003cspan style=\u0027font:7.0pt \"Times New Roman\"\u0027\u003e\u0026nbsp; \u003c/span\u003e\u003c/span\u003e\u003c/span\u003e\u003c![endif]\u003e\u003cspan\r\nstyle=\u0027color:#0000CC\u0027\u003eIbid.\u003co:p\u003e\u003c/o:p\u003e\u003c/span\u003e\u003c/p\u003e\r\n\r\n\u003cp class=ListParagraph\u003e\u003cspan style=\u0027color:#0000CC\u0027\u003e\u003co:p\u003e\u0026nbsp;\u003c/o:p\u003e\u003c/span\u003e\u003c/p\u003e\r\n\r\n\u003cp class=ListParagraph style=\u0027text-align:justify;text-indent:-.25in;mso-list:\r\nl0 level1 lfo1\u0027\u003e\u003c![if !supportLists]\u003e\u003cspan style=\u0027color:#0000CC\u0027\u003e\u003cspan\r\nstyle=\u0027mso-list:Ignore\u0027\u003e16.\u003cspan style=\u0027font:7.0pt \"Times New Roman\"\u0027\u003e\u0026nbsp; \u003c/span\u003e\u003c/span\u003e\u003c/span\u003e\u003c![endif]\u003e\u003cspan\r\nstyle=\u0027color:#0000CC\u0027\u003eSee supra n.6, section 12\u003co:p\u003e\u003c/o:p\u003e\u003c/span\u003e\u003c/p\u003e\r\n\r\n\u003cp class=ListParagraph\u003e\u003cspan style=\u0027color:#0000CC\u0027\u003e\u003co:p\u003e\u0026nbsp;\u003c/o:p\u003e\u003c/span\u003e\u003c/p\u003e\r\n\r\n\u003cp class=ListParagraph style=\u0027text-align:justify;text-indent:-.25in;mso-list:\r\nl0 level1 lfo1\u0027\u003e\u003c![if !supportLists]\u003e\u003cspan style=\u0027color:#0000CC\u0027\u003e\u003cspan\r\nstyle=\u0027mso-list:Ignore\u0027\u003e17.\u003cspan style=\u0027font:7.0pt \"Times New Roman\"\u0027\u003e\u0026nbsp; \u003c/span\u003e\u003c/span\u003e\u003c/span\u003e\u003c![endif]\u003e\u003cspan\r\nstyle=\u0027color:#0000CC\u0027\u003eSee supra n.6, section 23.\u003co:p\u003e\u003c/o:p\u003e\u003c/span\u003e\u003c/p\u003e\r\n\r\n\u003cp class=ListParagraph\u003e\u003cspan style=\u0027color:#0000CC;letter-spacing:.1pt\u0027\u003e\u003co:p\u003e\u0026nbsp;\u003c/o:p\u003e\u003c/span\u003e\u003c/p\u003e\r\n\r\n\u003cp class=ListParagraph style=\u0027text-align:justify;text-indent:-.25in;mso-list:\r\nl0 level1 lfo1\u0027\u003e\u003c![if !supportLists]\u003e\u003cspan style=\u0027color:#0000CC\u0027\u003e\u003cspan\r\nstyle=\u0027mso-list:Ignore\u0027\u003e18.\u003cspan style=\u0027font:7.0pt \"Times New Roman\"\u0027\u003e\u0026nbsp; \u003c/span\u003e\u003c/span\u003e\u003c/span\u003e\u003c![endif]\u003e\u003cspan\r\nstyle=\u0027color:#0000CC;letter-spacing:.1pt\u0027\u003eSECP, Code of Corporate Governance,\r\navailable.\u003c/span\u003e\u003cspan style=\u0027color:#0000CC\u0027\u003e\u003co:p\u003e\u003c/o:p\u003e\u003c/span\u003e\u003c/p\u003e\r\n\r\n\u003cp class=ListParagraph\u003e\u003cspan style=\u0027color:#0000CC;letter-spacing:.1pt\u0027\u003e\u003co:p\u003e\u0026nbsp;\u003c/o:p\u003e\u003c/span\u003e\u003c/p\u003e\r\n\r\n\u003cp class=ListParagraph style=\u0027text-align:justify;text-indent:-.25in;mso-list:\r\nl0 level1 lfo1\u0027\u003e\u003c![if !supportLists]\u003e\u003cspan style=\u0027color:#0000CC\u0027\u003e\u003cspan\r\nstyle=\u0027mso-list:Ignore\u0027\u003e19.\u003cspan style=\u0027font:7.0pt \"Times New Roman\"\u0027\u003e\u0026nbsp; \u003c/span\u003e\u003c/span\u003e\u003c/span\u003e\u003c![endif]\u003e\u003cspan\r\nstyle=\u0027color:#0000CC;letter-spacing:.1pt\u0027\u003e\u003cspan\r\nstyle=\u0027mso-spacerun:yes\u0027\u003e \u003c/span\u003e\u003c/span\u003e\u003cspan style=\u0027color:#0000CC;letter-spacing:\r\n.25pt\u0027\u003eSBP, Hand Book of Corporate Governance, available at \u0026lt;\u003c/span\u003e\u003cspan\r\nstyle=\u0027color:#0000CC\u0027\u003e\u003ca href=\"http://www.sbp.org.pk/about/corp-gov/index.htm\"\u003e\u003cspan\r\nstyle=\u0027color:#0000CC;letter-spacing:.25pt;text-decoration:none;text-underline:\r\nnone\u0027\u003ehttp:// \u003c/span\u003e\u003cspan style=\u0027color:#0000CC;text-decoration:none;\r\ntext-underline:none\u0027\u003ewww.sbp.org.pk/about/corp-gov/index.htm\u003c/span\u003e\u003c/a\u003e\u0026gt;.\u003co:p\u003e\u003c/o:p\u003e\u003c/span\u003e\u003c/p\u003e\r\n\r\n\u003cp class=ListParagraph\u003e\u003cspan style=\u0027color:#0000CC\u0027\u003e\u003co:p\u003e\u0026nbsp;\u003c/o:p\u003e\u003c/span\u003e\u003c/p\u003e\r\n\r\n\u003cp class=ListParagraph style=\u0027text-align:justify;text-indent:-.25in;mso-list:\r\nl0 level1 lfo1\u0027\u003e\u003c![if !supportLists]\u003e\u003cspan style=\u0027color:#0000CC\u0027\u003e\u003cspan\r\nstyle=\u0027mso-list:Ignore\u0027\u003e20.\u003cspan style=\u0027font:7.0pt \"Times New Roman\"\u0027\u003e\u0026nbsp; \u003c/span\u003e\u003c/span\u003e\u003c/span\u003e\u003c![endif]\u003e\u003cspan\r\nstyle=\u0027color:#0000CC\u0027\u003eTalley, Smuel I-I, Deposit Protection in Developing\r\nCountries, available \u003cspan style=\u0027letter-spacing:.6pt\u0027\u003eat http:\u003c/span\u003e/\u003ca\r\nhref=\"http://wvvw.allbusiness.com/public-administration/national-\"\u003e\u003cspan\r\nstyle=\u0027color:#0000CC;text-decoration:none;text-underline:none\u0027\u003ewvvw.allbusiness.com/public-administration/national\u0026#8209;\u003c/span\u003e\u003c/a\u003e\u003cspan\r\nstyle=\u0027letter-spacing:-.1pt\u0027\u003esecurity-international/132986-1.html\u0026gt;.\u003c/span\u003e\u003co:p\u003e\u003c/o:p\u003e\u003c/span\u003e\u003c/p\u003e\r\n\r\n\u003cp class=ListParagraph\u003e\u003cspan style=\u0027color:#0000CC\u0027\u003e\u003co:p\u003e\u0026nbsp;\u003c/o:p\u003e\u003c/span\u003e\u003c/p\u003e\r\n\r\n\u003cp class=ListParagraph style=\u0027text-align:justify;text-indent:-.25in;mso-list:\r\nl0 level1 lfo1\u0027\u003e\u003c![if !supportLists]\u003e\u003cspan style=\u0027color:#0000CC\u0027\u003e\u003cspan\r\nstyle=\u0027mso-list:Ignore\u0027\u003e21.\u003cspan style=\u0027font:7.0pt \"Times New Roman\"\u0027\u003e\u0026nbsp; \u003c/span\u003e\u003c/span\u003e\u003c/span\u003e\u003c![endif]\u003e\u003cspan\r\nstyle=\u0027color:#0000CC\u0027\u003eIbid.\u003co:p\u003e\u003c/o:p\u003e\u003c/span\u003e\u003c/p\u003e\r\n\r\n\u003cp class=ListParagraph\u003e\u003cspan style=\u0027color:#0000CC\u0027\u003e\u003co:p\u003e\u0026nbsp;\u003c/o:p\u003e\u003c/span\u003e\u003c/p\u003e\r\n\r\n\u003cp class=ListParagraph style=\u0027text-align:justify;text-indent:-.25in;mso-list:\r\nl0 level1 lfo1\u0027\u003e\u003c![if !supportLists]\u003e\u003cspan style=\u0027color:#0000CC\u0027\u003e\u003cspan\r\nstyle=\u0027mso-list:Ignore\u0027\u003e22.\u003cspan style=\u0027font:7.0pt \"Times New Roman\"\u0027\u003e\u0026nbsp; \u003c/span\u003e\u003c/span\u003e\u003c/span\u003e\u003c![endif]\u003e\u003cspan\r\nstyle=\u0027color:#0000CC\u0027\u003eSee supra n.6, section 25.\u003co:p\u003e\u003c/o:p\u003e\u003c/span\u003e\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027margin-bottom:0in;margin-bottom:.0001pt;text-align:\r\njustify;line-height:normal;mso-pagination:none;mso-layout-grid-align:none;\r\ntext-autospace:none\u0027\u003e\u003cspan style=\u0027font-size:12.0pt;font-family:\"Times New Roman\";\r\nletter-spacing:-.1pt\u0027\u003e\u003co:p\u003e\u0026nbsp;\u003c/o:p\u003e\u003c/span\u003e\u003c/p\u003e\r\n\r\n\u003c/div\u003e\r\n\r\n\u003c/body\u003e\r\n\r\n\u003c/html\u003e\r\n"