ISSN (Print) - 0012-9976 | ISSN (Online) - 2349-8846

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PAKISTAN-Man-Made Disaster

transactions entered into by banks with their clients, particularly in respect of bonds and units, clearly in contravention of RBI guidelines.
The reaction of the foreign banks to the criticism of their operations and to suggestions that these should be further investigated has been one of aggrieved sell- righteousness. It is not surprising that this should be so. It is known that as far back as in May 1990 an inspection report of the RBI on one of the foreign banks had revealed that the bank had been creating against LCs bills of its own, discounting them and then rediscounting them as well. The bank used to show in its books a curious entry, 'own acceptances dis counted'. Though Rs 500 crore worth of such 'bills* were identified, no action whatsoever had then been taken against the bank. Against the background of such treatment in the past, the foreign banks

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