Govt has crossed borrowing limit, say senators

A recent briefing given to a Senate panel by the State Bank clearly indicated that borrowing had gone up to about 64 per cent of the GDP. - File Photo

ISLAMABAD: The government has crossed the borrowing limit prescribed under the Fiscal Responsibility and Debt Limitation Act, 2005.

During the question hour in the Senate on Friday, Senators Haroon Akhtar and Prof Khursheed Ahmed said that under the law, the public debt must not exceed 60 per cent of the GDP. But a recent briefing given to a Senate panel by the State Bank clearly indicated that borrowing had gone up to about 64 per cent of the GDP.

The law requires the government to seek an approval from the parliament if it wants to exceed the limit on account of unforeseen expenditure warranted by a calamity or a national security issue.

SBP submits lists of written off loan beneficiaries

The other list contained names of 17 business entities whose amounts were waived off under BPD-29 (Circular 29) of State Bank of Pakistan. - File Photo.

ISLAMABAD: Counsel for State Bank of Pakistan Syed Iqbal Haider submitted the lists containing particulars of beneficiaries of written off bank loans with the Supreme Court of Pakistan on Wednesday.

Two separate lists were submitted with the three-member bench headed by Chief Justice of Pakistan Iftikhar Muhammad Chaudhry seized with issue of Rs 256 billion written off loans.

The first list contained top 50 beneficiaries of written off loans including 29 mills, companies or industries not covered by Circular 29.

Forex reserves dip to $16.88bn

KARACHI: Pakistan’s foreign exchange reserves slipped to $16.88 billion on regular debt payments by the week ended on October 22, the central bank said on Thursday.

The foreign exchange reserves held by the State Bank of Pakistan (SBP) declined to $13.09 billion while those held by other commercial banks came down to $3.79 billion, it said.

SBP’s gloomy report brings KSE down

KARACHI: The Karachi share market ended lower on Tuesday following the central bank’s forecast of lower economic growth and higher fiscal deficit, dealers said.

“Selling activity was witnessed†in the overbought market as the State Bank of Pakistan report indicated fiscal deficit rising to 6.3 percent of GDP in FY10 and GDP growth falling to 2-3 percent,” said Ahsan Mehanti, a director at Arif Habib Investments.

SBP lowers growth forecast for FY10-11

KARACHI: State Bank of Pakistan (SBP) lowered its gross domestic product growth forecast to be between 2 percent and 3 percent for the 2010/11 fiscal year (July-June), following the devastating floods in August.

Before the floods, the government's target was 4.5 percent.

SBP modifies procedure to prepare financial statements

KARACHI: The State Bank of Pakistan (SBP) on Tuesday modified procedures for banks and development financial institutions to prepare their financial statements as per the revised international accounting standards (IAS-I).

“While preparing quarterly, half-yearly and annual financial statements as required under the BSD Circular No 02, dated May 12, 2004 and the BSD Circular No 04, dated February 17, 2006, following approaches would be adopted for the financial statement prepared with effect from June 30, 2010,” said the State Bank in a circular issued here.

SBP limits maximum financing to Rs1bn

The State Bank of Pakistan (SBP) on Monday restricted, with immediate effect, maximum financing limit to Rs1 billion for a single export-oriented project under the Long-Term Financing Facility, according to a statement issued here on Monday.

The decision was taken in view of growing demand, diversify financing and risk, besides accommodating large number of borrowers, the statement said. Since the initiation of Long-Term Financing Facility in 2008, introduced to facilitate export growth, there was no bar on the maximum financing limit for a single borrower.

Suspicious transactions

Banks/DFIs directed to provide information to LEAs

KARACHI: The State Bank of Pakistan (SBP) on Tuesday directed banks and Development Finance Institutions (DFIs) to provide timely information related to suspicious transactions to the law enforcement agencies (LEAs).

“The central bank advice to banks/DFIs to provide timely information to LEAs would reduce money-laundering cases in the country,” said Syed Irfan Ali, director, Banking Policy and Regulation Department of the SBP.

Prospects for agri sector gloomy: SBP

KARACHI: Growth prospects for the agriculture sector remains gloomy in the wake of a fall in the production of rice and sugarcane and expected decline in wheat harvest in coming months, the SBP said in its report.

According to SBP estimates, the production of rice and sugarcane dropped 8.3 per cent and 2.8 per cent to 6.4 million tons and 48.6 million tons in Kharif 2010, respectively.

SBP Quarterly Report on State of Pakistan’s Economy

War on terror, lower revenue collection widen fiscal deficit GDP target unchanged at 3.5pc, current account deficit narrows, inflation bounces back

KARACHI: The State Bank of Pakistan (SBP) has raised the fiscal deficit forecast for the current financial year 2009/10 (July-June) to between 5.0 and 5.5 per cent of the gross domestic product (GDP) from the targeted 4.9 per cent in the wake of high defence spending and low revenue collection.

SBP keeps interest rate unchanged at 12.5pc

KARACHI: The State Bank kept the interest rate unchanged for two months on Saturday in the wake of reappearance of rising inflationary pressure, forcing the central bank to declare 12 per cent inflation for the current fiscal year.

“An upward adjustment in the interest rate, at this juncture, runs the risk of impeding the still nascent recovery, while a downward adjustment runs the risk of fuelling an already high inflation. Hence the SBP has decided to keep the policy rate unchanged at 12.5 per cent,” said the SBP monetary policy review.

SBP urged to pay drawback of local taxes

KARACHI: Exporters face acute liquidity crunch as huge amount of drawback of local taxes is pending against a large number of claims filed with the State Bank.
The ministry of textile industry in its five-year textile policy last September allowed drawback on local taxes and levies to the value-added textile sector to provide them a space in ever-rising cost of doing business.

SBP cuts mark-up on textile loans

KARACHI: The State Bank has decided to provide cheaper money to the textile sector as being extended to exporters under Export Finance Scheme (EFS).
The SBP on Monday announced a mechanism in consultation with the ministry of textile industry, under which the eligible borrowers of the textile sector will be provided mark-up rate facility under the SBP EFS and the mark-up rate support against long-term loans availed from banks and development financial institutions (DFIs).

NPLs double in 2 years to Rs432bn

KARACHI: The State Bank has expressed concern over rising quantum of infected loans posing a challenge for the banking industry in the country.
It has, however, claimed that the sector is well established and strong enough to face shocks.“The Non Performing Loans (NPLs) of the system had been showing consistent and rapid increase for the last one and a half years or so and almost doubled since calendar year 2007,” said the SBP’s Quarterly Performance Review of the banking system issued on Monday.

National Savings Bonds to be launched on 11th

ISLAMABAD: The National Savings Organisation will start issuing National Savings Bonds from Jan 12 which would be tradable on stock exchanges in Karachi, Lahore and Islamabad.
 
Federal Finance Minister Shaukat Tarin will officially launch the savings bonds at a ceremony in Islamabad on Monday (Jan 11).

Islamic export refinance users facilitated

Saturday, January 02, 2010
By our correspondent

KARACHI: The State Bank of Pakistan (SBP) on Friday said that export performance benefits have been extended to those who come under the Islamic Export Refinance Scheme (IERS).

Sindh Bank to begin operations from June 2010

Updated at: 1810 PST,  Saturday, December 26, 2009

KARACHI: Sindh Bank, being established by the Sindh Government will begin its operations from June 2010.

According to banking sources, Invest Bank, Taseer Hadi and Mohsin Tayyab have been appointed as the financial advisors for Sindh Bank.

09 a tough year for banks due to

economic slowdown, rising NPLs

Saturday, December 26, 2009
By Jawwad Rizvi

LAHORE: The Pakistani banking sector has faced a tough year due to general slowdown in economic activities and associated deterioration in the business environment.

The continued slowdown of economic growth has reflected on banking system causing an increase in the non-performing loans (NPLs), as the overall macroeconomic outlook with slight improvement on a few fronts remained tenuous.

SBP says e-payments growing

KARACHI: The State Bank of Pakistan (SBP) on Tuesday said volume and value of e-payment transactions during the first July-Sept quarter of fiscal 2009-10 reached 45.7 million and Rs3.9 trillion, respectively.

In its first quarterly report on retail e-payments and paper-based instruments, the SBP said use of electronic channels has showed consistent growth. During the first quarter, the volume and value of ATM transactions in the country touched 26.8 million and Rs206.4 billion respectively. Volume and value of online banking transactions recorded at 13m and Rs3.6 trillion, respectively.

State Bank announces payment of 6pc R&D

KARACHI: The State Bank of Pakistan has announced procedure for payment of 6 per cent Research and Development (R&D) support on export of processed food.
 
The SBP issued a circular inviting attention of authorised dealers to Trade Development Authority of Pakistan’s (TDAP) public notice on the subject of 6 per cent R&D support for export of processed foods.
The federal government has allowed 6pc R&D support on exports of processed food subject to observance of certain terms and conditions.

‘Claims so received may be forwarded to the TDAP for further necessary action at their end,’ said the SBP circular.