The State Bank of Pakistan (SBP) has increased the maximum exposure limit for unrated large private sector borrowers from Rs. 3 billion to Rs. 10 billion, allowing banks and development finance institutions (DFIs) to extend larger financing facilities to eligible companies.

The revised limit will come into effect from September 30, according to a circular issued by the central bank.

The SBP said the decision was taken after reviewing changes in economic conditions and considering feedback from the banking sector.

The updated exposure limit will also be reflected in the revised credit risk instructions under the standardized approach of the Basel III framework, which is currently being implemented by banks and DFIs.

The central bank clarified that all other requirements under the existing prudential regulations will continue to remain unchanged.