Can You Discuss Period Of Consolidation 1980s Of National Bank Of Pakistan?

Period of Consolidation :
On February 10, 1980 the Government of Pakistan announced a three year plan for the implementation of an Islamic Economic System. The institutionalization of Zakat and introduction of interest free banking were the two most important measures directed to Islamize the economy.

Initially interest was eliminated from the operations of National Investment Trust, House Building Finance Corporation and Investment Corporation of Pakistan in 1979. In the 1980-81 budgets the Government announced a package of policy measures in order to replace interest system with profit and loss sharing system.

The system was introduced by the nationalized commercial banks with effect from January 1, 1981. National Bank of Pakistan evolved and introduced a wholly separate and comprehensive procedure for banking under this system from branch level to Head office.

Along with development activities of the bank, consolidation of branch network was pursued. NBP decided to delegate administrative and financial powers to Principal Offices and Zonal Offices.

In 1980 a new Principal Office was created at Islamabad in addition to the existing Principal offices at Karachi, Quetta, Multan Lahore and Peshawar. It was felt that decentralization not only meets public demand but also contributes to better management through better and close supervision at the local level.