Legal Question in Banking Law in Pakistan

Re: joint pari passu

you have an answer in your question: when the company goes under liquidation, the Charge/lien of the bank shall be entertained in equal propostionate on all the assetts of the company.

Re: joint pari passu

The use of "pari passu" when creating a charge means that when company Y goes into dissolution, the assets over which the charge has been created will be distributed in proportion to the creditors' respective holdings. Therefore, if the Bank X has tendered a loan facility of 60 million PKR while another creditor, say Z, has tendered 40 million PKR, the recovery after selling assets of Company Y to which joint pari passu charge attached, shall be ditributed in the ratio of 6:4 amongst X and Z.

Where preferential rights attach to assets of the company, the preferential creditors rank higher in the distribution stakes i.e. they are paid in priority to other creditors of the company.

I hope your query is answered to some extent.

My kind regards are for you.