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First Women Bank.

Akram Khatoon, President First Women Bank

Q. Why the privatisation of FWB is being delayed?

A. The case of privatisation is still pending with the court, because the Dubai based Bin Ham Consortium, the successful bidder of 51 per cent shares of the FWB has filed a review petition against the Lahore Court decision wherein it was made binding on the consortium to maintain the peculiar charter of the bank. Bin Ham Group sought court verdict for allowing the bank to be run as a privatised commercial bank. The LHC in its verdict of October 1998 on the petition of home Women Action Forum (WAF) maintained. that the bank can be privatised without disturbing the special charter of the bank. How WAF has again gone into the court that bank should not be privatised at all. WAF stressed upon the need to preserve the special banks charter.

Of late we have been given an understanding that Bin Ham Group is willing to take over the management of the bank on terms and conditions of maintaining the special charter of the bank. Let us wait and see when the case materialises.

Q. Is downsizing on the cards in the bank?

A. The bank is already under staff, so no question of downsizing arises.

Q. What was the objective behind establishing Women Bank?

A. It is the global phenomenon that women are being discriminated in the matter of getting credit from the conventional banks. Pakistan was no exception to it. Here too women were facing the same problems. The conventional banks were reluctant to give credit to the women for business on grounds that they were not in a position to offer any collateral and secondly there was an impression that women lack required experience to run the business effectively and as such would not be in a position to repay the loans. Moreover, there was a general feeling among the women organisations that there should be a separate financial institution for the common women from where they could get loan and start business without offering any collateral. So it was that prime objective that resulted into the establishment of FWB on December 01, 1989, to perform functions other than a specified banking function.

Q. What is your progress since then?

A. We introduced schemes for the welfare of women in rural and backward areas, which have earned a tremendous response. The whole operation of the WFB revolves round the concept of not only ending discrimination in credit extension facility to women folk but developing entrepreneurship among them as well staff members, all ladies except those on guard duties. Naturally they are not only trained but motivated too, to attain that objective. Small loans schemes of upto Rs.25,O00 with no collateral and only two guarantors, has helped the women start cottage industries, poultry fanning etc. in Karachi's kutchi Abadis of Azam Basti,. Orangi, in Sindh's interior, and in Punjab at Patriata near Murree. In urban towns the bank finances ladies wishing to enter business like catering, beauty parlours, of upto same amount. Repayment terms are favourable. The bank is dealing in export business, issuing travellers' cheques, and makes penny, is invested in fruitful channels. It returns on profit and loss accounts has been e qual to leading banks and 0.2 per cent higher on saving. It is pertinent to point out that there is no women bank in India the solitary such bank in Manila (Philippines) is only a saving bank, and in America such an experiment has not been very successful.

We have 38 branches all over the country and recently two booths were opened, one in Women University Rawalpindi and another one in Islamic University. We are concentrating on training to improve the skill of the women. Around 165 business centres have been developed in Karachi to bring forward women entrepreneurs and similar centres are in offing in Lahore and Islamabad. Computer literacy programme was also started where even outsiders are allowed. However, since the privatisation process started in July, 1997 all expansions were freezed, restrictions were imposed on loan and recruitments were banned. The bank could not do anything except routine functions the delay in privatisation left adverse impact on the bank. Due to the uncertainty looming large some of our staff members also left the organisation. It was decided in September 1998 to start disbursing loans again.

Though the ban on recruitment and promotion was lifted in November last but the restrictions on expanding the organisations still continue. The bank at present is being operated like a commercial bank under Prudential Regulations, which are applicable to other banks. We have not extended any sort of concession or relaxation in any area of the bank over and above the rules. In fact five big banks are the owner of FWB because the equity for FWB is brought by these banks. HBL & MCB had contributed 30 per cent equity and rest of the three banks 20 per cent and Federal Government contributed 10 per cent from Ministry of Women Development. When FWB was set-up in December 1989 all the banks were in nationalised sector and no bank was allowed in private sector.
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Title Annotation:interview with Akram Khatoon, president, First Women Bank
Publication:Economic Review
Article Type:Brief Article
Geographic Code:9PAKI
Date:Aug 1, 1999
Words:865
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