Before partition of the subcontinent, the entire banking system was almost in the hands of Non-Muslims. When Hindu capitalists become sure of the division of the sub continent, they transferred their fund to India in safe places. There was also a mass scale migration of Non-Muslims from Pakistan to India, which also caused a reduction in the bank deposits.
At the time of independence in 1947 Pakistan’s Commercial banking facilities were almost jammed according to a plan. The following lines will give us a fair view of the situations, which were prevailing at that time.
Pakistan had practically no industries except a few textile mills and only produced food grains and agricultural raw materials; most of the industries were situated in the areas, which now constitute India.
LACK OF BANKING FACILITIES
A number of banks closed their branches with the result that only 81 branches remained open on 30th June 1948 out of 487 in 1947. As their head offices were in India and most of their Hindu staff fled to India. Imperial Bank of India, which was conducting government, receipts and payments work closed down most of its branches thus blocking the funds needed most by the government.
HABIB BANK LIMITED
The country being in infancy, needed most of the general commercial banking and credit facilities. And this need was a little bit satisfied with the transferring of the head office of the H.B.L. to Karachi on 7th August 1947.this bank played a great role in the next many years of the economic development of Pakistan. As the Habib Bank was also new in the newly born country .It was asked to open more branches at new places.
Imperial Bank of India, which was conducting government, receipts and payments work closed down most of its branches thus blocking the funds needed most by the government.
Formation of The State Bank of Pakistan:
In view of the above-mentioned circumstances and in order to rehabilitate the... [continues]
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