SBP revises investment limits for banks in shares, startups and mutual funds

The State Bank of Pakistan has changed the investment ceilings that banks and development finance institutions must observe when placing funds in company shares, startups, mutual funds, REITs and private equity funds. Mettis Global reported on October 24, 2026 that the revisions update Regulation R-6 under the prudential rules for corporate and commercial banking, through BPRD Circular Letter No. 22.

For one company’s shares, the permitted amount is capped at whichever is smaller: 5% of the institution’s Tier-I capital or 10% of that company’s paid-up shares. For a single startup, including a fintech, the ceiling is the smaller of 5% of Tier-I capital and Rs500mn; for a single mutual fund, REIT or private equity fund, it is the smaller of 5% of Tier-I capital and 20% of that fund’s units. Banks and DFIs must also adopt an approved investment policy covering internal assessment, financial capacity, risk appetite, expertise, expected returns and exit plans. Strategic holdings and investments in mutual fund and private equity units count toward aggregate limits, while NIT units are excluded until privatisation.