FWBL: Law Minister questions directors’ appointment

Aftab Ahmed

Islamabad: The Cabinet turns down the objection of the Law Minister and appoints chairman/directors on the Board of Directors of First Women Bank Limited (FWBL).

First Women Bank has been dysfunctional and the government has now appointed independent directors. However, the law minister has questioned their eligibility.

During a cabinet meeting, the Minister for Law and Justice pointed out that section 166 of the Companies Act, 2017 applied to the current appointment and inquired whether the finance ministry had drawn the names of the proposed directors from the SECP databank.

The Finance Minister, Shaukat Tarin, clarified that the directors on the Board of FWBL would serve in an honorary capacity and they would not draw any salary. Section 166 of the Companies Act, 2017 is not relevant.

However, Tarin said that they would charge a prescribed fee for attending the board meetings. It was also pointed out that the proposal of the Finance Division of the summary, if approved, would mean that there would be no ex-officio members on the Board and, hence, no representation of the Government on the Board.

The Finance Minister Shaukat Tarin further clarified that the government was selecting members of the Board on their professional acumen related to the sector-officio members create unnecessary bureaucratic hurdles, which not only impede working but also hinder the privatization process.

The Finance Division informed the Cabinet that, in accordance with Section II (1) (b) of the Bank’s (Nationalization) Act 1974, the Board of Directors of First Women Bank Limited (FWBL) shall consist of no fewer than 5 and no more than 7 members (excluding the Chairman and President).

According to Section 11 (3) (a) of the Act, the government appoints the Chairman, President, and other members of the Board of Directors of a bank in consultation with the State Bank of Pakistan (SBP) for a three-year term.

The First Women Bank Limited (FWBL)’s Board was dysfunctional since the Board was incomplete. Ms. Sumbal Munir was the only Director on the Board of FWBL. Private shareholders of the bank had elected her.

In a letter dated March 16, 2018, the Cabinet Division directed that all appointments to the Board of Directors be approved by the Prime Minister before being placed before the Federal Cabinet.

The Prime Minister has approved the following people for their placement before the cabinet for appointment as Chairman/Directors on the FWBL’s Board.

They included Mr. Akbarali A. Pesnani, Balochistan Independent Director, Mr. Wajahat Rasul Khan, Federal Independent Director, and Ms. Naghmana Alamgir Hashmi, Punjab Independent Director.

The finance ministry highlighted that proposing a panel for each slot of directors is not possible. In the instant case, because of the limited number of able, eligible, and willing people fulfilling the requirements of SBP’s Proper Criteria. The cabinet approved these individuals to serve on the bank’s board of directors.