Following mandatory targets for banks to finance the housing sector, SBP has initiated the strengthening of the recovery and foreclosure laws through draft amendments in Financial Institutions Recovery of Finances Ordinance, 2001 (FIRO) and also by drafting of the new foreclosure law as may be deemed necessary for the recovery regime.
Further developments in this regard took place in March 2020, when the newly enacted section 15 was declared as intra vires and the appeal petitions challenging the Lahore High Court decision of March, 2020 were dismissed by the Supreme Court in October, 2020. These developments may restore the confidence of the banking industry to exercise their right of foreclosure as per law and decision of the courts.
