The State Bank of Pakistan (SBP) on Monday restricted, with immediate effect, maximum financing limit to Rs1 billion for a single export-oriented project under the Long-Term Financing Facility, according to a statement issued here on Monday.
The decision was taken in view of growing demand, diversify financing and risk, besides accommodating large number of borrowers, the statement said. Since the initiation of Long-Term Financing Facility in 2008, introduced to facilitate export growth, there was no bar on the maximum financing limit for a single borrower.
Under the scheme, Participating Financial Institutions provide long-term financing of up to 10 years, including a maximum grace period of two years to their borrowers for import of machinery, as well as purchase of locally-manufactured machinery for setting up export-oriented projects.
Banks and Development Financial Institutions, however, may continue to provide financing facilities as per their credit policies over and above the maximum limit from their own resources, subject to adherence of the prudential regulations, the statement added.
Source The News
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