FE Clearing

FOREIGN EXCHANGE (FE) CLEARING
Branch Operations & Account Services

FE Clearing
APPROVAL SHEET
Document Ownership: Branch Operations & Account Services
Document Version: 3.0
Implementation Responsibility: Branch Operations & Account Services
Custodian: Branch Operations & Account Services
Operating Jurisdiction: HBL Pakistan
Review Frequency: 3 years or earlier if required
Review Responsibility: Branch Operations & Account Services
Last Approved: 2018
Approval Date:
Effective Date:
Next Review Date: 2024
Prepared by/ Reviewed by (Document Owner)
____________________
Ali Haider Gardezi
Head – Branch Operations Support & Governance
Stakeholder’s Review
Reviewed by
_________________
Ikramullah Khan
Head – Advisory & Policy Management –
Global Compliance
Concurred by
____________________ ____________________
Fouzia Jabeen Janjua Sagheer Mufti
Head – Branch Operations & Account Services Chief Operating Officer
Recommended By Approved By
___________________ ___________________
Muhammad Aurangzeb Board of Directors
President & CEO
Operations Manual
Version 3.0 – December 2021 FE Clearing
TABLE OF CONTENTS
1. INTRODUCTION .............................................................................................................. 1-1

1.1 OBJECTIVE ..................................................................................................................... 1-1
1.2 SCOPE .......................................................................................................................... 1-1
2. SCRUTINY OF CHEQUE/ INSTRUMENT & DEPOSIT SLIP .............................................................. 2-1
2.1 Introduction ................................................................................................................................... 2-1
2.2 Guidelines for Scrutiny of Cheque/Instrument................................................................................. 2-1
2.3 Important Considerations for Detecting Fraudulently Altered Cheques............................................2-2
2.4 Deposit Slip.....................................................................................................................................2-2
3. LOCAL USD CLEARING AND COLLECTION SYSTEM ..................................................................... 3-1
3.1 Introduction ................................................................................................................................... 3-1
3.2 Process at Branch ........................................................................................................................... 3-1
3.3 Process at CCU ................................................................................................................................ 3-5
4. FOREIGN BILLS FOR COLLECTION ......................................................................................... 4-1
4.1 Introduction ................................................................................................................................... 4-1
4.2 Process at Branch ........................................................................................................................... 4-1
4.3 Process at CFCC ............................................................................................................................. 4-4
5. Dispute Settlement Process ............................................................................................... 5-1
5.1 Settlement in case of insufficient balances ...................................................................................... 5-1
5.2 Process for Dispute Settlement with Clearing House ....................................................................... 5-1
6. Pakistan Banao Certificate (PBCs) ............................................................................. 6-1
7. ANNEXURES ................................................................................................................... 7-1
ANNEXURE A .......................................................................................................................... 7-1
Add List ..................................................................................................................................................... 7-1
ANNEXURE B .......................................................................................................................... 7-2
Bundle Cover ............................................................................................................................................ 7-2
ANNEXURE C .......................................................................................................................... 7-3
Summary Delivery Receipt ........................................................................................................................ 7-3
ANNEXURE D .......................................................................................................................... 7-4
Bank Transfer Scroll .................................................................................................................................. 7-4
ANNEXURE E .......................................................................................................................... 7-5
Cheque Return Memo ............................................................................................................................... 7-5
ANNEXURE F .......................................................................................................................... 7-6
Arrangement of Funds Report ................................................................................................................... 7-6
ANNEXURE G .......................................................................................................................... 7-7
OBC Schedule............................................................................................................................................ 7-7
ANNEXURE H ..........................................................................................................................7-8
Centralized Foreign Clean Collection .........................................................................................................7-8
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ANNEXURE I ........................................................................................................................... 7-9

Nostro Activity Report ............................................................................................................................... 7-9
ANNEXURE J ......................................................................................................................... 7-10
Memo .................................................................................................................................................... 7-10
ANNEXURE K ......................................................................................................................... 7-11
MT-499 ....................................................................................................................................................7-11
ANNEXURE L......................................................................................................................... 7-12
FCY Clean Collection (All Currencies) FCC Name Screening ....................................................................... 7-12
ANNEXURE M ....................................................................................................................... 7-13
Reference of Documents Used ................................................................................................................ 7-13
ANNEXURE N ........................................................................................................................ 7-14
Amendment Recording Sheet .................................................................................................................. 7-14
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Operations Manual
1. INTRODUCTION
Clearing is the process whereby Banks settle their claims arising on account of various Cheques/
Instruments presented by one Bank drawn on another.
In respect of Local USD Clearing, NIFT provides Clearing services ranging from collection and
delivery of Local USD Cheques/Instruments. However, in cities where NIFT services are not
available or Cheques/ Instruments are denominated in a currency other than USD, the Banks
directly exchange Cheques/Instruments and settle Funds through Nostro Accounts.
This chapter lays down the detailed procedural guidelines for the Bank staff to follow with
respect to Clearing and the overall responsibility of the Bank as a Member of the Clearing
System.
1.1 OBJECTIVE
The objectives of these Guidelines are to bring efficiency in clearing processes and standardize
the payment instruments’ collection and clearing operations.
1.2 SCOPE
The purpose of this document is to provide clear and user-friendly guidelines for processors,
supervisors and other staff associated with centralized processing of Inward Clearing.
This document provides guidance and is exclusively for use by the staff members of HBL. Page 1-1
Any act of divulgence shall be viewed very seriously and shall warrant disciplinary/penal action.
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2. SCRUTINY OF CHEQUE/ INSTRUMENT & DEPOSIT SLIP
2.1 Introduction
On receipt of the Cheque/Instrument from the Depositor along with filled in Deposit Slip, the
Teller/Designated Officer must scrutinize the same as per the following guidelines. The
guidelines are consistent with the Refer PSD circular no.1 of 2014 and PSD circular no. 4 of 2015
2.2 Guidelines for Scrutiny of Cheque/Instrument

2.2.1 While scrutinizing the Cheque / Instrument, the Teller/Designated Officer should ensure the following:
a. It is not Post-Dated (a Cheque bears a Date which is yet to come i.e. Future Date);
b. It is not Stale (an Instrument bears a Date prior to six months from the Date of its Lodgement);
c. It is not Mutilated or Torn;
d. Amount in figures and words are the same;
e. All Alterations/Amendments/Additions on the Cheque bear full Signature of the Account Holder;
f. Cheque is duly signed;
g. Instrument is duly signed by the Issuing Authority;
h. Scotch tape is not allowed on the cheque.
i. Do not process any clearing instrument in which previous clearing stamp is not cancelled, in case where
cheque presented by other branches of same bank or other bank.
j. If the cheque is mutilated, confirmation / endorsement of the presenting bank should be available
on the rear side of the instrument.
• In absence of SS Card not available on SIG-CAP, Cheque will be honour subject to

provide approval from respective branch Area Operation Manager / Area Manager
well before cheque return cut off time to NIFT else cheque will be return and branch
will be responsible for any customer complaints.
Refer PSD circular no.1 of 2014 and PSD circular no. 4 of 2015 for compliance.
k. Other Precautions:
▪ If the Cheque is of a Non-Individual Customer, then Entity’s rubber stamp must be affixed, and it
is duly signed by the Authorized Signatories to the account as per the Operating Instructions;
▪ If the Cheque/ Instrument is payable to the Firm, it should not be accepted for credit to a
Partner’s Personal Account;
▪ If the Cheque/ Instrument is drawn in favour of a Trust Account, it should not be credited to the
account of Trustee;
▪ Any Cheque/Instrument marked “Not Transferable” should not be collected for a person other
than the Payee;
▪ A Crossed Cheque/Instrument in favour of Joint Names cannot be collected for the credit of
Individual account whereas it may be deposited in the Joint account if it is in favour of any of the
Joint Account Holder;
▪ If the Cheque/Instrument is drawn in favour of a Minor’s account, then the Title of Account must
consist of the Minor’s Name as well as the Guardian’s Name; and
▪ Cheque/Instrument is not drawn on a Photo Account.
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2.3 Important Considerations for Detecting Fraudulently Altered Cheques

2.3.1 HBL Cheque Leaves have a variety of security features (Annexure B) designed to tackle counterfeiting and
fraudulent activities. It is imperative for the branch staff to be well-versed with the following Cheque leaf
security features in order make effective use of the same:
2.3.2 Printed Features (Visible Through Naked Eye)

a. Magnetic Ink Character Recognition (MICR) code line is printed on the Cheque leaves which contains
the Cheque Number (7 digits), Bank Code (3 digits), Branch Code (4 digits), Account Number (10 digits)
and NIFT/Vendor Code (3 digits). The Cheque and Account Numbers visible on the right side of the
Cheque leave are also mentioned in the MICR code.
b. The MICR code is printed in red ‘bleed through ink’ which penetrates the face of the Cheque and is
visible on the reverse side, thus eliminating the chances of any tampering of the MICR line.
c. Special ink is used for background boxes on which the Cheque Number is pre-printed. Similarly, the
amount box and payee name have the anti-forgery green shading incorporated. Any forced alteration
will immediately become visible if the surface is scraped or erased. The Magnifying Glass or
Ultraviolet Light (where available) will clearly highlight the alteration(s).
d. The Cheque Book leaves are printed with the HBL’s Watermark which become visible if the
instrument is held in light. Watermark is difficult to replicate as it is incorporated by the paper mill at
the time of making the actual security paper.
e. The Cheque is being printed on CBS-1 security paper which is a standard for Banking
f. Security instruments. The authenticity of the security paper can be checked through an Instant
Verification (IV) marker. When the marker is applied it leaves a black line/impression on the security
paper confirming the instrument’s authenticity.
2.3.3 Other Security Features (Visible Under Ultraviolet Light)

a. Invisible Hi-Lites in two colors, i.e. small colored fibers in the cheque leaf.
b. Invisible HBL Logo printed multiple times with UV Ink within the cheque viewable under UV light.
2.4 Deposit Slip

2.4.1 The Teller/Designated Officer should ensure that the Customer has duly completed the following
information / particulars in the Deposit Slip:
a. Branch Name and Current Date (Cross Branch Cheque/Instrument is also acceptable);
b. Title of Account and Account Number in which the Funds are to be credited;
c. Type of Account (Current/Savings) and Currency;
d. Name of Bank/Branch;
e. Cheque/ Instrument Number;
f. Contact Number;
g. Depositor’s Name;
h. Depositor’s Signature;
i. Depositor’s CNIC No. (For Non-HBL/ Walk-In Customers); and
j. Depositor’s Account Number (For HBL Customers/ Account Holders).
2.4.2 The Teller/Designated Officer should ensure that the total amount in figures mentioned in the Deposit
Slip is the same as the amount in words. It should also be ensured that there is no un-authorized alteration
on the Deposit Slip.
2.4.3 In addition to the above, the following details are checked by the Teller/ Designated Officer at this stage:
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a. Bank and Customer copy of the Deposit Slip bear the same Serial Number and details of the
Cheque/Instrument;
b. The Name of the Payee on the face of the Instrument and on the Deposit Slip must be the same in
case of an Account Payee Instrument/ Cheque. However, in case the Name of the Payee on the
Cheque/Instrument is not the same, then it is checked for any Endorsement
c. If multiple Cheques/Instruments are being deposited against a single Deposit Slip, then the particulars
of each Cheque/Instrument should be mentioned on the Deposit Slip;
d. If Multiple Deposits are being made in Cash and Cheque, then separate Deposit Slips should be filled
in for Cash and Cheque; and
e. A single Cheque/Instrument should not be lodged in favour of Multiple Beneficiaries.
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3. LOCAL USD CLEARING AND COLLECTION SYSTEM
3.1 Introduction
3.1.1 As per Chapter 6, Paragraph 2 “Local US Dollar Instruments Collection and Settlement System” of the
Foreign Exchange Manual (FE Manual) issued by SBP, Local US dollar instruments collection and
settlement system has been introduced in the banking industry with effect from March 11, in order to
facilitate the operations for maintaining Foreign Currency Accounts under FE-25.
3.1.2 Cheques/ Instruments which are denominated in USD and drawn on the branches of other banks are
cleared through NIFT. This service is offered by NIFT in the Designated Cities as mentioned below:
a) Karachi b) Multan
c) Lahore d) Sialkot
e) Islamabad f) Peshawar
g) Rawalpindi h) Quetta
i) Faisalabad j) Mirpur
k) Hyderabad.
3.1.3 There are two Collection and Settlement days per week (Monday and Thursday) during which NIFT
performs the Clearing operations. If a Collection/ Settlement day falls on a Bank Holiday, it will be skipped
until the immediately next Collection/ Settlement day.
3.1.4 US Dollar Local Clearing Cell located at the Centralized Clearing Unit (CCU) is a dedicated unit responsible
for presenting outward and receiving Inward Cheques/ Instruments to/ from NIFT and processing the
subsequent Settlement in the system.
3.1.5 Furthermore, in compliance with SBP’s FE manual Chapter 6 Private Foreign Currency Accounts, the Bank
compulsorily abides with the following procedures:
a. It has opened a US$ settlement account with a minimum balance of US$ 10,000/- for settlement with
SBP-Banking Services Corporation (Bank) Karachi and thereafter maintains such sufficient balance as
necessary to cater its business requirements. The said account is remunerated on the same interest
rate as for SCRR [Special Cash Reserve Requirement] under FE-25.
b. It settles the payment of US$ instruments drawn on it through this system or returns the unpaid
instruments on settlement date.
c. In case the paying bank does not return the original instrument on the settlement date to the
presenting bank, it is assumed that the instrument has been accepted for payment and will be settled
through this system accordingly.
3.2 Process at Branch

3.2.1 Outward Clearing
HBL Exchange Dealing Branches in the Designated Cities are authorized to send USD Cheques/Instruments
for clearing which are drawn on other Banks. The Cheques/Instruments are sent by the Collecting
Branches to the Designated Branch in the city. The designated branch then sends the
Cheques/Instruments to the CCU for onward Collection by NIFT.
3.2.2 Process at Collecting Branch
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3.2.2.1 Receipt of Cheque/ Instrument at Counter

i. After satisfactory scrutiny of the Cheques/ Instruments and the Deposit Slips as specified in
the section 2, the ‘Crossing Stamp’ and ‘Clearing Stamp’ is affixed on the face of the
Cheques/ Instruments and Deposit Slips by the Teller/ Designated Officer. Thereafter, both
the Customer and Bank copies of the Deposit Slip are signed and the Customer copy of the
Deposit Slip is handed over to the Depositor for record purposes.
Note: Teller/ Designated Officer should ensure that the Clearing stamp bears the date who
advisory of the subsequent Collection and Settlement day from the day the Cheque/Instrument
will be collected by NIFT. In case of a bank holiday the settlement of the Instrument would be
done on the next Collection and Settlement day.
3.2.2.2 Receipt of Cheque/ Instrument through Cheque Deposit Kiosks (CDK)

i. To automate the cheque deposit process, CDK have been installed at various branches. CDK
accepts cheques which are normally deposited by Customers on the branch counter.
ii. Cheques are deposited by an Account Holder in CDK after entering a valid 14-digit Account
Number.
iii. Title of the account is displayed for verification and the Account Holder is requested to enter
the mobile number.
iv. Deposit slip for the Account Holder is automatically printed by CDK which contains the
details and image of the deposited cheque.
v. Clearing/ Designated Officer collects the cheques from Cheque Bin in CDK at different
intervals during a day.
vi. For processing Outward Clearing Cheques, Clearing/ Designated Officer selects AID option
in the system which displays all Outward Clearing Cheques deposited through CDK.
vii. The cheques are scrutinized by the Clearing/ Designated Officer as per the existing practice
of scrutiny of the cheques deposited at the counter. (For details, please refer to section 2
'Scrutiny of Cheque).
viii. After scrutiny, the Clearing/ Designated Officer will post the Outward Clearing Cheques in
the system.
Note: Details of the cheques deposited in the CDK are auto populated in the MISYS for further
processing.
3.2.2.3 Preparation of Collection Schedule

i. Clearing/ Designated Officer records the particulars of the Cheques/ Instruments in the
Lodgement Register/ MIS.
ii. Covering Letter for the Cheques/ Instruments is prepared and duly signed by the Clearing/
Designated Officer. Thereafter, Cheques/ Instruments along with the Covering Letter are
dispatched via courier to the designated branch in the city.
3.2.2.4 Realization of Outward Clearing USD Instruments

i. The ‘Local USD Collection and Settlement Account’ is used for the Settlement of Funds with
Customer accounts. Clearing/ Designated Officer is required to monitor this account for
credit in the respective ‘USD Collection and Settlement Account’ on Settlement days i.e.
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Monday and Thursday. On realization, the Clearing/ Designated Officer shall post the
following entry in the system and deduct charges as per the latest SOBC.
GL Code Description Debit Credit
88880117018170 Local USD Collection and Settlement Account XXXX
- Customer Account XXXX
3.2.2.5 Returned Cheques/Instruments

i. Physical Returned Cheques/ Instruments along with the Cheque Return Memos (Annexure
E) are received by the Clearing/ Designated Officer from the CCU. (For process at CCU, refer
to section 3.3.1.3).
ii. Details of the Cheques/ Instruments received are recorded in the Cheques/ Instruments
Return Register/ MIS. Thereafter, Charges are manually deducted from the Customer’s
Account as per the latest SOBC.
iii. All the Returned Cheques/ Instruments are retained in safe custody by the Clearing/
Designated Officer. The respective Customer is then informed about the Returned Cheques/
Instruments through a phone call and is requested to collect the same from the branch.
iv. In case the Customer does not approach the branch, an Intimation Letter is sent on the
Customer’s address on the same day as a Reminder by the Clearing/ Designated Officer.
v. For those Customers with whom contact cannot be established, an Intimation Letter,
requesting the Customer to collect the Returned Cheque/ Instrument, is sent on the next
working day. In case the Intimation Letter is returned or remains undelivered, the Cheque/
Instrument is kept in the safe custody without any time limit by the Clearing/ Designated
Officer.
vi. Once the Customer approaches the branch, the Customer's signature is obtained on the
Cheques/ Instruments Return Register by the Clearing/ Designated Officer and the Cheque/
Instrument is then handed over to the Customer.
vii. Charges to be recovered against instruments where return with below reasons as per
current SOBC including FED where applicable
Code Return Reason
1.1 Amount in words and figures differs
1.2 Insufficient funds in Drawer’s Account
2.1 Date is missing
2.5 Incomplete Instrument/Required details are missing
Payment Instrument contains extraneous/conditional

2.8
statements
6.1 Alteration on payment instrument requires drawer’s signature
6.2 Signature is forged
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6.3 Signature is missing
6.4 Signature is unauthorized
Any other reason (Due to below reason)
8.1.2 Signature missing as per Operating Instructions
8.1.3 Photo Account

8.1
8.1.4 Company Rubber Stamp Required / Wrong Stamp Affixed
8.1.5 Invalid Date
8.1.6 Payee Name Required
3.2.2.6 Process at Designated Branches

i. Cheques/ Instruments are received via courier/ postal from all of the Exchange Dealing
Branches in a city/ town.
ii. Thereafter, Add List Form (Annexure A) is prepared by the Clearing/ Designated Officer. Add
List contains details of the amount of each cheque/ instrument and running total.
iii. Additionally, Bundle Cover (Annexure B) is prepared by the Clearing/ Designated Officer as
per the particulars and description mentioned below:
Bundle Cover
Particulars Description
Bank / Branch Name Branch stamp with Branch Code is affixed
No. of Cheques / Instruments Total Number of Cheques/Instruments in the Bundle
Total Amount The Total of the Jotting Sheet is noted
Date The Current Date is mentioned
Authorized Signature The Clearing Officer/ Designated Officer signs the Bundle Cover.
iv. All Cheques/ Instruments are placed into a reusable envelope provided by NIFT along with
OBC Schedule (Annexure G) by the Clearing/ Designated Officer. The envelope is then
dispatched via courier/ postal services/ to CCU for onward Collection of Cheques/
Instruments by NIFT.
3.2.3 Inward Clearing

In accordance with the Internal Circular P/INST/2016/219, Inward Clearing of Local US Dollar
Instruments has been centralized with effect from 27th December, 2016. Accordingly, the
Cheques/ Instruments are processed and posted in the system at central location i.e. CCU. (For
details, refer to “Process at CCU” mentioned below).
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3.3 Process at CCU

3.3.1 Outward Clearing
All Collecting Branches route their Cheques/ Instruments through the Designated Branch of the city to
CCU. Outward Clearing Cheques received at CCU day before clearing collection (i.e. Wednesday & Friday)
will be entertained for lodgment to NIFT.
3.3.1.1 Stamping of Cheque/Instrument

i. Cheques/ Instruments along with the OBC Schedule are received by the Clearing Officer at
CCU from the designated branches via courier/ postal services/ messenger.
ii. Clearing Officer reconciles the Cheques/ Instruments details with the OBC schedule to
ensure the completeness and correctness of the information specified therein. Clearing
Officer also ensures that ‘Branch Stamp’ and ‘Discharge Stamp’ have been affixed by the
Collecting Branch on the cheques/ instruments.
iii. Scrutiny of Cheques/ Instruments is performed and on successful scrutiny, ‘Branch
Endorsement Confirmed’ and “USD Clearing” stamps are affixed on the back the Cheques/
Instruments.
iv. FCC Report (Pouch File) containing details of all the cheques/ instruments lodged during a
particular day is prepared manually. The report is forwarded by the Designated Officer twice
a week to an Officer at Sanctions Screening Unit within FCC Department for clearance.
v. Particulars of the Cheques/ Instruments are recorded in the Lodgement Register/ MIS and
scanned copy of the Cheques/ Instruments is retained for record purposes.
vi. Instruments are bundled into stacks and for the respective bundle, jotting sheet (Add List)
and bundle cover is prepared.
3.3.1.2 Sorting of Cheques/Instruments and Collection by NIFT

i. A Summary Delivery Receipt (refer Annexure C) in triplicate is prepared by the Designated
Officer which contains the following details:
Summary/Delivery Receipt
Particulars Description
The grand total of the number of Cheque/ Instruments
Total number
mentioned on all the bundle covers attached with the bundles.
The grand total of the amounts of Cheques/ Instruments
Total Amount
mentioned on all the bundle covers attached with the bundles.
Bank / Branch Stamp The Branch Stamp is affixed.
Bank / Branch - Authorized The Clearing Officer/Designated Officer signs the Summary
Signature Delivery Receipt.
Date The same date as mentioned on the bundle covers.
The built in number on a plastic seal, provided by NIFT, for
Seal Number locking the bag in which the Cheques/ Instruments are placed
for sending to NIFT.
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ii. The Summary/ Delivery Receipt and bundle cover is signed by the Inputter and the same
along with add lists and physical Cheques/Instruments are placed in a bag (provided by
NIFT). Subsequently, the bag is locked with a plastic seal and collected by the NIFT
3.3.1.3 Realized and Returned Cheques/Instruments
i. On the next Collection and Settlement day, following documents are received from NIFT:
▪ Duplicate copy of Summary / Delivery Receipt (Receiving of same day’s Cheques / Instruments
lodged for Clearing)
▪ Returned Cheques/ Instruments along with Return Memos.
▪ Bank Transfer Scroll (Annexure D).
ii. Designated Officer records the particulars of the Returned Cheques/ Instruments in the
Returned Cheques / Instruments Register/ MIS. Copies of the returned Cheques/
Instruments are retained for record purpose.
iii. Designated Officer dispatches the Returned Cheques/ Instruments along with the Return
Memos to the respective Collecting Branches via courier. (For process at collecting branch,
refer to section 3.2.1)
iv. MT 499/ Memo (Annexure K) is also sent to branches mentioning the details of cleared
cheques/ instruments.
3.3.2 Inward Clearing

Under the Centralized Inward Clearing mechanism, all the Cheques/ Instruments of the respective Drawee
Branches are delivered to the Centralized Foreign Clean Collection (CFCC).
3.3.2.1 Scrutiny of Cheque/ Instrument received from NIFT
l. On the designated Collection and Settlement day (either Monday or Thursday), the
following documents are received from NIFT:
▪ Summary/ Delivery Receipt (as acknowledgment of same day’s outward clearing)
▪ Details of dishonoured and cleared Cheques/Instruments
▪ Bank Transfer Scroll
▪ Inward Clearing Cheques/ instruments
▪ Outward Return Cheques/Instruments
ii. Clearing Officer at CCU verifies the Cheques/Instruments received from NIFT and reconciles it with
Bank Transfer Scroll to ensure completeness of the Cheques/Instruments received. Clearing Officer
will inform to branch via email for POT (Purpose of transaction) and CBC. If branch fails to provide
CBC and POT, then CCU will return the cheque with the reason POT required but cheque return
charges will not be deducted.
iii. After reconciliation, the Cheques/ Instruments are scrutinized by Clearing Officer to ensure the
following:
a) Cheque/Instrument is duly signed and the signatures matches with the Specimen
Signature in the Signature System;
b) Crossing stamp is affixed on the face of the instrument whereas USD Clearing stamp is
affixed on the back of the Instrument;
c) There is no difference between the amount stated in words and figures; and
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d) The Instrument is not post-dated or stale.
iv. FCC Report (Pouch File) containing details of all the cheques/ instruments lodged during a particular
day is prepared manually. The report is forwarded by the Designated Officer twice a week to an
Officer at Sanctions Screening Unit within FCC Department for clearance. In case of any discrepancy
raised by FCC then CCU will coordinate with branch for required detail. e.g. DOB, FATHE NAME etc. If
response not received, then CCU will return the cheque with reason “REQUIRED INFORMATION IS
MISSING”
3.3.2.2 Posting of Cheques/Instruments in the system
II. On satisfactory scrutiny, Clearing Officer input the details of the cheques/instruments into
the system by using the AGI Option.
III. A popup window will be open automatically for caption the details i.e POT, Country Code,
bank Code & FX Source will be entered.
IV. The following entry is posted in the system after authorization from Clearing Supervisor:
Local USD Collection and Settlement
88880117018170 XXXX
Account
V. Clearing Officer should ensure that the entries are posted in the system before the next
Collection and Settlement Date.
VI. “Posted” stamp is affixed on the honoured Cheque/Instrument. Subsequently, the cheque/
instrument is signed and cancelled by the Officer
3.3.2.3 Inward Clearing Returns Processing
i. The inputter prepares Cheque Return Memo (Annexure E) for the instruments dishonoured
due to scrutiny or system invalidation for transmission to NIFT and enters their respective
details in the Return Excel based MIS.
ii. The dishonoured instruments are bundled into stacks and for the respective bundle, jotting
sheet (Add List), bundle cover and summary delivery receipt is prepared.
iii. The Summary/ Delivery Receipt and bundle cover is signed by the Inputter and the same
along with add lists and physical Cheques/Instruments are placed in a bag (provided by
NIFT), locked with a plastic seal and collected by the NIFT representative.
iv. Return charges will be deducted as per SOBC
3.3.3 Settlement
3.3.3.1 Posting of Settlement Entries
i. USD Collection and Settlement statement, detailing Inward and Outward Clearing amounts
and the Net Clearing Position of the Bank for the day is prepared by the Designated Officer.
A balancing entry against the SBP Account is then posted in the system by the Designated
Officer on the basis of the USD Collection and Settlement Statement and authorized by the
Manager, USD Clearing Cell.
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▪ If Net Payable
G.L. Code Description Debit Credit

88880111010770 SBP USD Clearing Settlement Account XXXX
▪ If Net Receivable

88880111010770 SBP USD Clearing Settlement Account XXXX
3.3.3.2 Reporting to Global Treasury
An ‘Arrangement of Funds’ report (refer Annexure F), signed by the Manager (Centralized
Accounts Services) is prepared by the Clearing Officer which is submitted on every Monday and
Thursday to Forex, Treasury Operations along with transfer scrolls received from NIFT and the
USD Collection & Settlement Statement. The ‘Arrangement of Funds’ report specifies the
position of the Cleared and the Returned Cheques/Instruments so as to enable the Treasury
Division to settle the funds with the respective Banks.
ii. Return charges will be deducted as per SOBC

iii. YEN /JRC report will be checked by the supervisor
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4. FOREIGN BILLS FOR COLLECTION
4.1 Introduction
4.1.1 FCY Cheques/ Instruments (other than USD) drawn on Local Banks are sent/ received as Bills for Collection
to/from the Collecting/Drawee Bank. Sending/ Receiving of such Cheques/Instruments along with
Settlement of Funds is handled by the respective branch.
4.1.2 FCY Cheques/Instruments Collected/Drawn by/on Foreign Banks are also processed and settled as
Collection Bills. Outward Bills are sent to the Foreign Banks and Inward Bills are received through the
Centralized Foreign Clean Collection (CFCC).
Note: Inward clearing is processed only for CNY, EUR, GBP and USD whereas Outward Clearing
instrument can be processed in any currency.
4.2 Process at Branch
4.2.1 Outward Bills for Collection
4.2.1.1 Stamping of Cheque/Instrument
i. After satisfactory scrutiny of the Cheques/ Instruments and the Deposit Slip as mentioned
in section 2 above, the Outward Bills for Collection (OBC) and Branch Stamps are affixed on
the face of the Cheques/ Instruments and Deposit Slip by the Teller/ Designated Officer.
Thereafter, both the Customer and Bank copies of the Deposit Slip are signed and the
Customer copy of the Deposit Slip is handed over to the Depositor for record purposes.
ii. The discharge stamp is also affixed on the back of the Cheque/ Instrument.
4.2.1.2 Dispatch of Foreign Demand Drafts and International Cheques to CFCC
i. All branches, Authorized Dealer Branches (AD), Semi Authorized Branches (SAD) and Non
Authorized Dealer Branches (NAD) will send Annexure A (Annexure H) duly checked/
completed along with the Cheques/ Instruments to Centralized Foreign Clean Collections,
CFCC by courier/messenger.
ii. Annexure A shall be jointly signed by two Authorized Signatories. Copy of the Annexure A
and the Cheques/ Instruments will be filed by the branch for record purposes.
4.2.1.3 Dispatch of Local FCY Cheques/ Instruments to Drawee Bank
i. Cheques/ Instruments along with the OBC Forwarding Schedule (Annexure G) are
dispatched to the respective Drawee Bank. If the Customer has requested the proceeds in
equivalent PKR, the same shall be mentioned on the OBC schedule, thereby directing the
Drawee Bank to send a PO/ DD in PKR.
Note: The OBC schedule is forwarded to the respective drawee bank on the same working if
deposited by the customer before 4:00 PM otherwise it is forwarded on the next working day.
4.2.1.4 Realization of funds
i. Local Foreign Currency Cheques: Realized Cheques/ Instruments are reflected in the Daily
Nostro Reconciliation Report. If the amount requested by the Customer is in a Foreign
Currency, the following entry is posted to credit the Customer’s Account:
Operations Manual

- Nostro Account XXXX
ii. If the proceeds requested by the Customer are in PKR, a PO/ DD is received from the Drawee
Bank which is lodged in Normal Clearing of the branch. On realization of proceeds, the same
is credited in the Customer’s Account.
4.2.1.5 Foreign Demand Drafts/ International Cheques
i. The daily Nostro Activity Report (Annexure I) pertaining to the respective branch is received
from the Nostro Reconciliation Division through e-mail. For Cheques/ Instruments for which
proceeds are reflected in the Report, the respective AD/ SAD branches will obtain Deal Rate
for their Customers from Treasury and also enquire from NAD branches if Deal Rate is
required by any of their Customers for Cheque/ Instrument amounts exceeding USD 5,000
or (equivalent amounts in other currencies).
ii. AD/ SAD branches shall forward Deal Number, Rate, Realized Amount and Reference
Number of the Cheques/ Instruments exceeding USD 5,000 or equivalent amount in other
Currencies to CFCC through email for settlement.
iii. Collecting Branches can monitor the status of lodged Cheques/ Instruments by extracting
Cheque status report from the system. This report can be viewed by AD, SAD and NAD
branches.
4.2.1.6 Returned Cheques/ Instruments
i. Cheques/ Instruments received unpaid at CFCC are sent to the respective AD/ SAD branches
along with a Memo specifying therein the reason for Return. AD/ SAD branches shall hand
over the Cheques/ Instruments to their Customers and send Cheques/ Instruments
pertaining to NAD branches for onward delivery to their Customers.
4.2.2 Inward Bills for Collection
In terms of circular P/INST/2018 “Inward Foreign Currency Clean Collection through Local and
Foreign Banks”, all Cheques/ Instrument drawn on HBL branches are received and processed at
Centralized Cheque Collection Department (CFCC) except those Cheques/ Instruments collected
by the Local Banks where proceeds are to be remitted in the equivalent PKR. However, certain
responsibilities still vest with the branches which are mentioned below:
▪ Conducting Call Back Confirmation with the customer on the request of CFCC (in case of
doubt or amount exceeds 10,000 in any foreign currency) and sharing the confirmatory
email with CFCC.
▪ Ensuring that the amount and purpose of the remittance is in line with Customer’s KYC
profile as the Payment Screening Unit (PSU) shall also be screening the transactions against
customers KYC profile.
4.2.2.1 Processing of Cheque/ Instrument Collected by Local Banks
a. Scrutiny of Instruments/Cheques
Cheques/ Instruments received from the Local Banks are scrutinized by the Clearing/ Designated
Officer in accordance with section 2 above
Operations Manual
b. Posting of Cheque/ Instrument in the System

i. On satisfactory scrutiny, Clearing/ Designated Officer forwards the Cheques/ Instruments to
the Teller, who enters the details into the system by using the AGI Option. The following
entry is posted in the system:
00079927624xxx Routing Account (Forex Branch) XXXX
ii. A Banker’s Cheque is prepared using the credit transferred to the Routing Remittance
Account. Subsequently, the Banker’s Cheque is dispatched to the Collecting Bank via courier.
Operations Manual
c. Returned Cheques/Instruments
Cheques/ Instruments are dishonoured due to scrutiny or system invalidation. The Officer sends
the Cheque/ Instrument along with a Cheque Return Memo is sent to the respective Collecting
Bank via courier.
4.3 Process at CFCC
4.3.1 Outward Bills for Collection
4.3.1.1 Lodgment
i. Cheques/ Instruments along with Annexure A (Annexure H) are received from the respective
Authorized Dealing (AD), Semi Authorized Dealing (SAD) and Non-Authorized Dealing branches.
ii. The Cheques/ Instruments are then scrutinized by the Designated Officer who further ensures that
the Branch Crossing Stamp is affixed on the face of the Cheque/ Instrument and the Discharge stamp
is affixed on the back of the Cheque/ Instrument. The Designated Officer also ensures from the
system using the AE option that the Account number mentioned on Annexure A corresponds with
the Account Title and that the account is not blocked/ closed or marked with any other exception.
iii. The Cheque/ Instrument is sent back to the respective branch via courier if any discrepancy is
identified by the Designated Officer during scrutiny.
iv. Cheques/ Instruments are lodged currency-wise in the system by the Designated Officer upon which
the system automatically generates the entries and registers liability against the input branch (CFCC)
along with CFCC numbers.
52209893300ccy OBC Contingent Contra Account (TO A/c type- XXXX
respective FCY)
52207901194ccy Customer (Sundry CFCC) OBC Contingent (RO XXXX
A/c Type) Shadow Account
v. The lodgment carried out for a Cheque/ Instrument can only be maintained and deleted during the
same day it is lodged, otherwise it will remain in the system until it is realized or returned in due
course.
4.3.1.2 Screening of cheques/ instruments by Anti Money Laundering (FCC) Department, Global Compliance
i. FCC Report (Pouch File) containing details of all the Cheques/ Instruments lodged during a particular
day is prepared manually and forwarded to the FCC Department for clearance by the Designated
Officer. It is a single consolidated report showing details of all currency transactions for the day.
ii. Cheques/ instruments cleared by the FCC Department are dispatched via courier to the respective
Collecting Banks at different destinations under the cover of CFCC Covering letter along with the
pouch file.
iii. Cheques/ Instruments not cleared by the FCC Department are withheld and the lodgment for such
Cheques/ Instruments is deleted from the system on the same day by the Designated Officer. Such
Cheques/ Instruments are retained in safe custody at CFCC until the final decision is communicated
by the FCC Department which usually takes 2 to 3 days. Cheques/ Instruments if cleared are re-lodged
and are sent for collection while rejected Cheques/ Instruments, if any, are sent back to the respective
branches via courier for onward delivery to their customers.
Operations Manual
4.3.1.3 Up Front Processing Charges Deducted by Drawee Bank
i. Drawee Banks may in certain cases where the amount of the Cheque/ Instrument is relatively large,
request CFCC to grant them an authority to debit the Bank’s Nostro Account for claiming upfront
processing charges.
ii. If the balance is available in the Customer Account, CFCC directly debits the charges to customer
account. The claim of charges is reflected in the Daily Nostro Activity Report and a SWIFT message
MT 199/299 is also received at CFCC from the Drawee Bank. Thereafter, the following entry is posted
by the Designated Officer which is duly authorized by the Supervisor.

- Customer Account (PKR) XXXX
52207901193310 Nostro Account (respective FCY) XXXX
4.3.1.4 Realization of Proceeds
i. On daily basis, CFCC receives Nostro Activity Report containing details of realized Cheques/
Instruments from the Nostro FCY Reconciliation Department. In some cases, the realized amount is
lesser than value of the Cheque/ Instrument as charges (handling/ other miscellaneous charges) may
be deducted from the proceeds by the Drawee Bank/ Correspondent Bank.
ii. On the basis of the Nostro Activity Report, the Designated Officer initiates the realization process to
credit the Customer’s account in the system. The Designated Officer informs the respective branch
to obtain conversion rate from Treasury Operations (TROPS) on receipt of funds against the Cheque/
Instrument lodged.
In case of proceeds for USD 5,000 or above or (equivalent amounts in other currencies), conversion
rate may be negotiated with TROPS by the branches on behalf of the customers. For proceeds less
than USD 5,000, conversion rate available in the system shall be used. If the Customer’s lodgment
account and the Cheque/ Instrument are denominated in the same currency, cross currency
conversion will not be required.
Note: For certain customers, rate may be negotiated with TROPS for amounts below USD 5,000.
iii. Branches are required to email the deal number, conversion rate and realized amount before 2:00
pm to CFCC for same day realization and crediting of proceeds in Customer’s accounts.
iv. The Designated Officer runs the relevant system option upon which the system auto reverses the
contingent contra created at the time of lodgment and generates the following entries:

52209884300ccy Contingent Contra Account (lodgment amount XXXX
of FCY)
- Customer (Sundry CFCC) XXXX
v. To settle Contingent Contra (OBC) Account with Customer (Sundry) CFCC, the Designated Officer will
run the relevant system option to pass the following manual entries:

- Customer (Sundry CFCC) XXXX
52209884300ccy Contingent Contra Account (FCY) XXXX
Operations Manual
vi. Proceeds from Nostro account to customer’s account are credited (in different currency) by using the
ITA cross currency option. AGI option will be used in case the cross currency conversion is not
required.

52207901193310 Nostro Account (respective FCY) XXXX
- Customer Account (PKR) XXXX
vii. Recovery of charges and commission is done through Post Manual Charges (PMC) option. Following
entries are passed:

BBBB912012ccy CFCC Commission XXXX
BBBB912304ccy Courier Charges XXXX
Note: Charges will be recovered as per SOBC in equivalent FCY at spot rate available in the system.
viii. The Supervisor CFCC reviews and authorizes all the postings in the system to ensure that the
settlement done from the realized proceeds is correct. The proceeds are credited to the Customer's
account and charges/ commission recovered are credited to the respective P&L Accounts.
Note: For certain customers, the branches may waive the Bank charges and commission. In such
instances, the branches are required to provide a copy of approval for CFCC record.
4.3.1.5 Returned Cheque/ Instrument
i. The Designated Officer will mark return of Cheque/ Instrument in the system on receipt of SWIFT
message from the Overseas HBL Branch/ Correspondent Bank and is also reflected on Nostro Activity
Report.
ii. The Supervisor CFCC will authorize the transaction in the system after ensuring that cheque return,
courier and other allied charges have been recovered from the customer’s account and
simultaneously credited to respective P&L/ Nostro Accounts.
iii. Cheques/ Instruments received unpaid at CFCC are dispatched to respective AD/ SAD branches along
with a Memo specifying therein the reason for return and the SWIFT message received from the
Correspondent Bank/ Branch for onward delivery to the customer.
A. Recovery of Charges from Customers Maintaining Accounts in PKR
i. Recovery of charges including Collecting Bank charges, commission etc. from customers maintaining
accounts in PKR is made irrespective of availability of sufficient funds in their accounts. It shall be the
responsibility of the respective branch to recover from the customer any overdraft (OD) created due
to recovery of charges/ commission.
B. Recovery of Charges from Customers Maintaining Accounts in FCY
i. Recovery of charges from the customer maintaining accounts in FCY is made in the same FCY provided
that the customer has sufficient balance in the account to cover the charges; otherwise the Routing
Account of the branch will be debited and branch will have to arrange the recovery of funds from the
customer to square the Routing Account provided that sufficient balance is available in the Routing
Account.
Operations Manual
ii. The following entries will be posted at CFCC to recover charges/ commission:

BBBB992767 Routing Account (respective branch FCY)/ XXXX
ccy Customer Account
BBBB912abc Cheque Returned charges XXXX
ccy
BBBB912304ccy Courier Charges XXXX
Note: Charges will be recovered as per the latest SOBC in equivalent FCY at spot rate.
iii. Following entry will be posted by the branch to square the Routing Account:

BBBB992767 ccy Routing Account (respective branch XXXX
FCY)
C. Recovery of Handling/ RUP (Returned Unpaid) Charges deducted by the

Collecting Bank
i. Some Collecting Banks recover handling charges against the Cheque/ Instrument returned unpaid by
debiting the Nostro account. To recover the charges from the customer maintaining account in FCY
and not having sufficient funds in it, the following entries will be passed at CFCC to square the
respective Nostro Account:

BBBB992767 ccy Routing Account (respective branch FCY) XXXX
8888- Nostro Account XXXX
ii. Following entry will be posted by the branch to square the Routing Account:

BBBB992767 Routing Account (respective XXXX
ccy branch)
4.3.1.6 Periodical Reminders for Delayed Fate

i. Proceeds of the Cheques/ Instruments sent for collection are received from HBL Branch/
Correspondent Bank within 21 days from lodgment. In case of delayed fate, periodic reminders
through e-mail are sent to the Branch/ Bank as follow-up for realization.
Reminders Time
st
1 25 days after lodgment
2nd 10 days after 1st reminder
3rd 10 days after 2nd reminder
ii. In case proceeds are not received after 3 reminders, the Designated Officer will escalate the matter
to Head Centralized Accounts Services.
Operations Manual
iii YEN / JRC report will be checked by the supervisor.
4.3.2 Inward Bills for Collection

4.3.2.1 Receipt of Instruments from Collecting Bank
i. Cheques/ Instruments drawn on HBL along with the associated Covering Letters/ Schedule are
received by the Designated Officer from the Collecting Banks (both local and international) via
courier.
ii. The Officer manually records the particulars of the Cheques/ Instruments in the Centralized Inward
Clean Collection Register.
4.3.2.2 Scrutiny of Instruments/Cheques

i. Cheques/ Instruments are scrutinized by the Clearing/ Designated Officer in accordance with section
2 above. In case the Cheque/ Instrument does not meet the scrutiny criteria, the Cheque/ Instrument
shall be returned. (Refer to section 4.2.3.8, ‘Returned Cheque/ Instrument’)
ii. The Officer shall ensure that pre requisite information (as may be required by Payment Screening
Unit is available in respect of the Cheque/ Instrument. In case such information is not available, the
same shall be obtained from the Branch via email. In case the Branch is unable to provide the required
information, the same is obtained directly from the Collecting Bank. Pre requisite information may
include the following:
▪ Details of the bank from which the collection was received including full name, postal and SWIFT
addresses.
▪ Details of the beneficiary including full name, postal address
▪ Details of the drawee (account holder of HBL) including full name, postal address
▪ Details of the presenting bank, if any, including full name, postal address, swift address
▪ Amount(s) and currency(ies) to be collected
▪ Purpose of Payment (Required as per FE Regulations for making remittance)
▪ Supporting documents to validate the purpose mentioned therein
▪ Confirmation that purpose mentioned there-in is allowed as per FE Regulations
▪ Complete routing details including the intermediary bank
▪ History of Collection transactions from this account along with details during last six months
iii. In case the required information is not received within 3 business days, the Officer shall send a
reminder to the Branch/ Collecting Bank for submitting the information. The Officer has authority to
return the Cheque/ Instrument if the information is not received within 5 business days from the date
of the reminder. In such cases no charges shall be levied on the customer. (Refer to section 4.2.3.8,
‘Returned Cheque/ Instrument’).
4.3.2.3 FCC Screening

i. Upon receipt of all the required information as mentioned above, the Officer shall send the details of
the Cheque/ Instrument and parties involved in the transaction as per Annexure ‘B” (Annexure L) to
Anti Money Laundering Department FCC ) for FCC clearance.
ii. In case FCC requests any information in relation to a Cheque/ Instrument, CFCC shall send MT 199
(for International Bank) / Email (for Local Bank) to the Collecting Bank for gathering the required
information.
iii. After receipt of the information, the same shall be shared with FCC for FCC Clearance.
Operations Manual
iv. In case of any discrepancy raised by FCC then CCU will coordinate with branch for required detail. e.g.
DOB, FATHER.NAME etc. If response not received, then CCU will return the cheque with reason
“REQUIRED INFORMATION IS MISSING”
4.3.2.4 Call Back Confirmation

i. In case of any doubt in respect of Cheque/ Instrument or the amount of the Cheque/ Instrument
exceeds 10,000 (in any foreign currency), scanned copy of the Cheque/ Instrument is sent to the
respective branch via email and the branch is further requested to conduct Call Back Confirmation
(CBC) with the customer.
ii. In case of satisfactory CBC, confirmatory email is received from the branch. However, in case if the
confirmatory email is not received within 3 business days, the Officer has the authority to return such
Cheques/ Instrument. (Refer to section 4.2.3.8, ‘Returned Cheque/ Instrument’).
iii. Clearing Officer will inform to branch via email for POT (Purpose of transaction) and CBC. If branch
fails to provide CBC and POT, then CCU will return the cheque with the reason POT required but
cheque return charges will not be deducted.
4.3.2.5 Settlement
I. The Officer inputs the details of the Cheque/ Instrument into the system by using the AGI
Option. The following entry is posted in the system: A popup window will be open
automatically for caption the details i.e POT, Country Code, bank Code & FX Source will be
entered.

52209927687xxx Routing Account (FCY) XXXX
II. The above entry is supervised by an Authorizer in the system.

III. For each Cheque/ Instrument, the Officer opens AOP option in MYSIS and enters COL in payment type
for inputting the following mandatory details:
▪ Receive Currency
▪ Amount
▪ Nostro Account
▪ Remitter ID
▪ Swift Code of CFCC
▪ Ordering Customer Information
▪ Sender’s Reference (Collecting Bank)
▪ Swift Code of Correspondent Bank
▪ Payment Purpose Code
▪ Beneficiary institution details (Swift Code, Account Number, Name and Address)
▪ Sender and Receiver Information
▪ HBL Operations Code (CRED)
▪ Beneficiary details
▪ Instructed currency and Actual Amount
IV. Once the information has been entered by the Officer, the same is supervised by an Authorizer at CFCC
Operations Manual
4.3.2.6 Payment Screening

i. The information entered in AOP option becomes automatically available to an Authorizer at PSU. In
case PSU requests further information in respect of a Cheque/ Instrument, CFCC shall arrange such
information from the branch/ collecting bank.
ii. Upon provision of the requested information, the Authorizer at PSU supervises the information in the
AOP Option and following entry is generated:

52209927687xxx Routing Account (FCY) XXXX
- Nostro Account (FCY) XXXX
00079930043840 Commission Income (Auto XXXX
Deducted)
- Swift Charges (Auto Deducted) XXXX
iii. In case PSU rejects the transaction due any reason, the Officer shall reverse the transaction and funds
will be credited back to the Customer Account. In such case, no charges will be levied.
4.3.2.7 Funds Transfer to Nostro Bank

i. Upon authorization of the information in AOP, Auto SWIFT messages (MT 202 General Financial
Institution Transfer) is generated in the system and transmitted to the Nostro Bank.
ii. The Officer shall ensure that there are no entries outstanding at day in the Routing Accounts.
iii. On next working day, Officer shall check Nostro Activity to ensure that amount has been debited by
the Nostro Bank. Thereafter, the Officer shall send an email to the respective branches providing
complete details of the collection Cheques/ Instruments
iv. The Officer shall also keep the copy of relevant Nostro debit transaction page alongside other set of
documents for record purposes.
4.3.2.8 Returned Cheques/ Instruments

i. The Officer prepares a Covering Letter for the returned Cheque/ Instrument stating the reason for
returning the Cheque/ Instrument and forwards to Supervisor for review and sign off. Furthermore,
the Officer posts the Cheque Return Charges in MYSIS through PMC (DI) Option.
Note: If sufficient funds are not available in the Customer’s account, the Drawee Branch shall be
intimated via email to arrange funds from the Customer.
ii. Thereafter, the Supervisor signs the Letter and authorizes the Cheque Return entry in the system.
iii. The Officer dispatches the Cheque/ Instrument to the Collecting Bank via courier.
4.3.3 Retention of Inward Clearing Instruments

4.3.3.1 All physical Inward Cheques/ Instruments are retained with CCU
4.3.3.2 In case any branch or customer wants the Paid Cheque to be retrieved, the branch shall formally
request the respective CCU for the same via Letter or Email with proper endorsement to the
respective ROC / SAM OPS. The CCU shall be required to retain a photocopy of the Instrument
and attaching the Request Letter / E-mail with it before delivering the original Instrument under
proper receipt/ acknowledgment.
Operations Manual
4.3.3.3 All cleared Instruments are safe keeping under lock and key, where they are kept fire proof
Almirah /Steel Trunks for maximum period of five years and are later on dispatch/forwarded to
HBL storeroom for further 5 years.
Operations Manual
5. Dispute Settlement Process
5.1 Settlement in case of insufficient balances

5.1.1 The process of settlement of US$ Cheques/ Instruments takes place by either debiting or crediting the US
Dollar Clearing Account on the respective settlement date. If, however, at any point of time, due to
insufficient balance the net debit/ credit (inward and outward) cannot be paid out of the Bank’s US Dollar
Clearing Account, the Bank can adopt a suitable alternative granted to it by SBP. The alternative results in
the form of payment through an appropriate overnight SWAP from the Pak Rupees clearing account
balance of the bank with SBP to the extent of such shortfall in US Dollar account.
5.1.2 The SWAP Limit in respect of the above-mentioned transaction is communicated by SBP to the Bank’s
Global Treasury Department.
5.1.3 JRC / YEN will be checked by the supervisor.
5.2 Process for Dispute Settlement with Clearing House

In case a dispute arises, the Bank(s) shall report the issue in writing to the chief Executive officer (CEO) of
the Clearing House along with complete details of the dispute within ten working days from the date of
receipt of complaints.
In this regard, the following steps shall be taken by bank:
a. An interim reply shall be given to customer after ten working days from the date of receipt of
complaints.
b. The Clearing House shall convene a meeting resolve the dispute by mutual agreement within
three working days.
c. All such disputes shall not take more than fifteen working days from the date of receipt of
complaint for their resolution. However, the fraud related complaints shall be resolved within
thirty days from the date of receipt of complaint.
The disputes that cannot be resolved amicably between the Clearing House and Bank within the specified
time be referred to Chief Manager of the respective SBP-BSC office.
Operations Manual
6. Pakistan Banao Certificate (PBCs)
Process at Centralized Foreign Clean Collection Unit (CFCC)

• After receiving the instructions from NBP Treasury Operations Wing Group. Centralized Foreign
Clean Collection (CFCC) unit shared via email with Treasury Operations for confirmation and
availability of funds credited in our SBP USD Clearing Settlement account.
• After Successful Confirmation from Treasury Operations, then CFCC will perform following Steps:
(CFCC) ensure verification of account title and account number as mentioned in the NBP
instruction with the same amount. Once verification is complete then (CFCC) proceed to credit
the customer account.
In case of proceeds for USD 5,000 or above or (equivalent amounts in other currencies),
conversion rate may be negotiated with TROPS by the branches on behalf of the customers. For
proceeds less than USD 5,000, conversion rate available in the system shall be used.
• The CFCC will process as mentioned below upon satisfactory Review:
1. AGI Option
DR. SBP US$ SETTLEMENT ACCOUNT 88880111010770

CR. Customer A/c XXXXX (Provided by NBP)
2. ITA Option (for Credit in PKR account)
DR. SBP US$ SETTLEMENT ACCOUNT 88880111010770

CR. Customer A/c XXXXX (Provided by NBP)
• Once above steps are taken, then (CFCC) intimate to NBP officials for the credit of fund into
customer account Payment of Half Yearly coupon (PBCs) via email pbc@nbp.com.pk before EOD.
• (CFCC) will also update respective MIS for (PBCs)
• YEN/JRC will be checked by the supervisor.
Operations Manual
7. ANNEXURES
ANNEXURE A
Add List
Operations Manual
ANNEXURE B
Bundle Cover
Operations Manual
ANNEXURE C
Summary Delivery Receipt
Operations Manual
ANNEXURE D
Bank Transfer Scroll
Operations Manual
ANNEXURE E
Cheque Return Memo
Operations Manual
ANNEXURE F
Arrangement of Funds Report
Operations Manual
ANNEXURE G
OBC Schedule
Operations Manual
ANNEXURE H
Centralized Foreign Clean Collection
Operations Manual
ANNEXURE I
Nostro Activity Report
Operations Manual
ANNEXURE J
Memo
Operations Manual
ANNEXURE K
MT-499
Operations Manual
ANNEXURE L
FCY Clean Collection (All Currencies) FCC Name Screening
Date Payees/ Payee BR Type Drawee Maker Maker Cheque Cheque CCY Cheque
Beneficiary Account Code Name Account Date Amount Number
No.
Operations Manual
ANNEXURE M
Reference of Documents Used
Document
S.No. Date Subject
Reference
1. P/INST/2016/219 December 21, 2016 Centralization of Local US Dollar Clearing
May 29, 2017 Cheque Deposit Kiosks (CDKs)

2. P/INST/2017/115
Inward Foreign Currency Clean Collection Through

P/INST/2018/3 January 29, 2018
3. Local and Foreign Banks
Operations Manual
ANNEXURE N
Amendment Recording Sheet
Circular Effective
S.No. Date Subject
Number Date

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FOREIGN EXCHANGE (FE) CLEARING

Branch Operations & Account Services

Version 3.0 – December 2021 FE Clearing

1. INTRODUCTION .............................................................................................................. 1-1

Version 3.0 – December 2021 FE Clearing

ANNEXURE I ........................................................................................................................... 7-9

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Version 3.0 – December 2021 FE Clearing

2. SCRUTINY OF CHEQUE/ INSTRUMENT & DEPOSIT SLIP

2.2 Guidelines for Scrutiny of Cheque/Instrument

h. Scotch tape is not allowed on the cheque.

• In absence of SS Card not available on SIG-CAP, Cheque will be honour subject to

Version 3.0 – December 2021 FE Clearing

2.3 Important Considerations for Detecting Fraudulently Altered Cheques

2.3.2 Printed Features (Visible Through Naked Eye)

2.3.3 Other Security Features (Visible Under Ultraviolet Light)

2.4 Deposit Slip

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Version 3.0 – December 2021 FE Clearing

3. LOCAL USD CLEARING AND COLLECTION SYSTEM

3.2 Process at Branch

3.2.2 Process at Collecting Branch

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3.2.2.1 Receipt of Cheque/ Instrument at Counter

3.2.2.2 Receipt of Cheque/ Instrument through Cheque Deposit Kiosks (CDK)

3.2.2.3 Preparation of Collection Schedule

3.2.2.4 Realization of Outward Clearing USD Instruments

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3.2.2.5 Returned Cheques/Instruments

1.2 Insufficient funds in Drawer’s Account

2.1 Date is missing

2.5 Incomplete Instrument/Required details are missing

Payment Instrument contains extraneous/conditional

6.1 Alteration on payment instrument requires drawer’s signature

6.2 Signature is forged

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6.3 Signature is missing

6.4 Signature is unauthorized

Any other reason (Due to below reason)

8.1.2 Signature missing as per Operating Instructions

8.1.3 Photo Account

8.1.5 Invalid Date

8.1.6 Payee Name Required

3.2.2.6 Process at Designated Branches

3.2.3 Inward Clearing

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3.3 Process at CCU

3.3.1.1 Stamping of Cheque/Instrument

3.3.1.2 Sorting of Cheques/Instruments and Collection by NIFT

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3.3.1.3 Realized and Returned Cheques/Instruments

3.3.2 Inward Clearing

3.3.2.1 Scrutiny of Cheque/ Instrument received from NIFT

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d) The Instrument is not post-dated or stale.

3.3.2.2 Posting of Cheques/Instruments in the system

3.3.2.3 Inward Clearing Returns Processing

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G.L. Code Description Debit Credit

G.L. Code Description Debit Credit

3.3.3.2 Reporting to Global Treasury

ii. Return charges will be deducted as per SOBC

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