Pkrevenue.com

Author: Mrs. Anjum Shahnawaz

  • Bank deposits hit a record high at Rs17.87 trillion

    Bank deposits hit a record high at Rs17.87 trillion

    KARACHI: Deposits of the banking system have reached a record high of Rs17.87 trillion owing to higher remittances and lack of cash-based business activities, analysts said on Thursday.

    The deposits hit a record high to Rs17.87 trillion by end of December 2020 after posting an increase of 22.14 percent when compared with Rs14.63 trillion by the end of December 2019, according to data released by the State Bank of Pakistan (SBP).

    According to the analysis of Topline Securities, the growth in deposits has been fueled by higher remittances (+17.5 percent YoY in USD and 27.5 percent YoY in PKR terms during 11M2020), while lack of business activity due to COVID-19 (cash-based) may have also increased bank deposits.

     Investments have grown by 31 percent to Rs11.5trn in 2020. At the start of the year, the high yield on offer had already lured banks to move towards investments, which was compounded further as COVID-19 hit strangling business activity and in turn loan growth.

     Advances grew by just 2 percent in 2020 as banks remained wary of overall economic conditions due to COVID-19. However, the last quarter of 2020 for Advances has been relatively better with 3.4 percent QoQ growth. The aggressive cuts in interest rates by the Pakistan Central Bank since Mar-2020 may be starting to reap fruits as the impact of the COVID-19 pandemic also lowers and economic activity picks up.

    Investment to Deposit Ratio (IDR) had already depicted an improvement to 67 percent in Sep-2020, which has been maintained at year-end. To recall this was 66 percent in Jun-2020 and 60 percent in Dec-2019. The higher IDR is largely due to high-interest rates at the start of the year and low appetite for risk (Advances) due to COVID-19. ADR has dropped to 48 percent from 49 percent in Sep-2020 (to recall, this was at 51 percent in Jun-2020 and 56 percent in Dec-2019).

     Provisioning has also seen a substantial increase as banks have opted to increase General Provisioning in the wake of COVID-19, however, the last quarter has seen provisions stabilizing as the banks feel that they have adequately provided for up until Sep-2020.

    M2 growth clocked in at 16 percent in 2020 primarily driven by the stellar deposit growth this year and a 19 percent increase in Currency in Circulation (CIC). CIC increased to Rs6.30trn by the end of December 2020, with CIC as a percent of M2 clocking in at 29 percent, above the past 5-year average of 27 percent. Reasons for increasing CIC can be attributed to low-interest rates and evasion from tax authorities.

    Going forward, we expect Deposit growth in the range of 12-14 percent during 2021E, while we expect Advances to grow by around 4-6 percent, where banks are expected to remain risk-averse given concerns over further waves of COVID-19.

  • Member IR (Operations) holds meetings with tax officials, industry to boost revenue collection

    Member IR (Operations) holds meetings with tax officials, industry to boost revenue collection

    KARACHI: Dr. Muhammad Ashfaq, Member Inland Revenue (Operations) of the Federal Board of Revenue (FBR) has launched a round of meetings with tax officials and industrialists during his four–day visit to Karachi starting from January 14, 2021.

    FBR sources on Thursday said that the Member IR had a busy schedule, which included meeting with the tax offices and chambers/associations.

    The sources said that the meetings would focus on revenue collection during the first half of the current fiscal year.

    During his meeting with chambers and associations, the member would encourage the industrials to contribute towards revenue collection.

    According to the schedule, the member will kick off the visit to meet with an industrialist on Thursday evening.

    The member on Friday will meet with office bearers of Karachi Chamber of Commerce and Industry (KCCI) and Pakistan Readymade Garments Manufacturers and Exporters Association (PRGMEA). On the same day, the Member will meet the senior officials of the Medium Tax Office (MTO) and Corporate Tax Office (CTO) to review the revenue collection performance.

    On Saturday, the member will hold meetings with representatives of the Pakistan Yarn Merchant Association (PYMA) and Karachi Tax Bar Association (KTBA). On the same day, the Member will also hold a meeting with office-bearers of the Federation of Pakistan Chambers of Commerce and Industry (FPCCI).

    On Sunday, the Member is scheduled to meet Chief Commissioners Inland Revenue to discuss the revenue performance.

  • Duty, tax above Rs1 million made mandatory through e-payment

    Duty, tax above Rs1 million made mandatory through e-payment

    KARACHI: The payment duty and taxes amounting above Rs1 million has been made mandatory through the electronic mode from January 20, 2021, said Wajid Ali, Director General, Reforms and Automation, Federal Board of Revenue (FBR).

    At a meeting with members of the Federation of Pakistan Chambers of Commerce and Industry (FPCCI), Wajid Ali said that the online system was introduced through a procedure in 2017 in collaboration with the State Bank of Pakistan (SBP), a statement said on Thursday.

    This system is connected with the WeBOC and payment of taxes can be made by pay orders and cash to create a balance.

    Such procedures are already adopted by a number of countries worldwide. The system is operated by a unique ID which is called a PSID number issued to the relevant users who are connected to approximately 16000 different branches of the relevant bank across Pakistan.

    In order to further ease the payment of taxes, the system is also supported by easy paisa / OTC on a mobile phone to the users as well and the facility through this system is available with the taxpayers on the basis of 24/7.

    No drastic adoption of the system was observed last year by the users and in order to enforce the online payment by the system, it is now automated in such a way that the payment of taxes beyond Rs. 1 million cannot be made through the old system of payment of taxes.

    “It is, therefore, mandatory to the taxpayers that they are bound to get PSID number if the amount of taxes to be paid accedes Rs. 1 million or above,” he added.

    The last date to adopt the new system by the taxpayers is January 20, 2021, as announced by the FBR so that the payment of taxes may be made more effective and transparent.

    This will also ease to compile the statistical data relating to revenue collection within no time. At present now 22 percent of the collection of taxes is being carried out with the help of a new electronic system and it is not out of place to mention that positive feedback is coming in from the taxpayers who are already using the facility.

    Mian Nasser Hyatt Maggo President, FPCCI appreciated Pakistan Revenue Automation Private Limited (PRAL) for improving ease of doing business and facilitating the business industry while presiding the meeting of FPCCI Standing Committee on Customs headed by Shabbir Hassan Mansha.

    He further said when it comes to business endeavors every business person has to deal with Customs, FBR, and SBP.

    Most people are confused by the complexity of processes. The meeting expects the experts to disentangle the process complications.

    A team of experts from Pakistan Customs and Pakistan Revenue Automation Private Limited (PRAL) joined FPCCI Head Office, Karachi the in the meeting of FPCCI Standing Committee on Customs, for a presentation with FPCCI member trade bodies across Pakistan simultaneously at FPCCI Head Office Karachi (Chair), Capital Office Islamabad and Regional Offices at Lahore, Peshawar & Quetta via Zoom Link to deliver the presentation.

    The team members include Mr. Wajid Ali, Director General, Reforms & Automation, FBR; Sanaullah Abro, Director Reforms & Automation, and Arshad Hussain, Sr. Manager, PRAL, Customs House, Karachi along with representative of State Bank of Pakistan (SBP).

    The presentation was attended by the trade bodies from all over Pakistan on Zoom.

    In the meantime, the trade bodies were also briefed by the other team members including representatives from the State Bank as to how to adopt the new system with minimum hurdles.

    During the question-answer session, the representatives of trade bodies from all over Pakistan were invited to share their views and queries in this respect. In general, the trade bodies have shown their interest and shown their willingness to register themselves within the newly adopted system of payment of taxes.

    The views were also shared by the representatives of trade bodies via Zoom Link from all FPCCI Stations who were present on Zoom.

    Shabbir Hassan Mansha, Convener, FPCCI Central Standing Committee on Customs informed that his committee will organize more sessions relevant to Customs, and SBP to enhance the knowledge and relevant information on the subject.

    Khurram Ijaz former vice president FPCCI while presenting the vote of thanks to the participants and the experts’ said that a close liaison between the FBR and SBP and trade bodies should be maintained by appointing a focal person from FBR and SBP respectively for the ease of trade.

  • Stock market sheds 103 points in range bound activity

    Stock market sheds 103 points in range bound activity

    KARACHI: The stock exchange fell by 103 points on Thursday in range-bound trading activities during the day.

    The benchmark KSE-100 index of the Pakistan Stock Exchange (PSX) closed at 45,989 points as against the previous day’s close of 46,092 points showing a decline of 103 points.

    Analysts at Arif Habib Limited said that the market saw profit booking today after testing 46k level a number of times during the week.

    The index oscillated between -239 points and +181 points during the session and closed -103 points.

    Selling activity was observed in Banks, Cement, E&P sectors, which was caused by a host of reasons including a slight decline in international crude oil prices.

    Among fertilizer sector stocks, FFBL performed well on the back of subsidy on DAP, being announced and taken into effect.

    Delay in issuance of the textile policy, which was earlier scheduled to be announced yesterday is now postponed for tomorrow. Among scrips, HUMNL topped the volumes with 57.5 million shares, followed by KEL (45.6 million) and FFBL (25.8 million).

    Sectors contributing to the performance include E& (-70 points), Cement (-31 points), Fertilizer (-17 points), Pharma (-14 points) and Technology (-20 points).

    Volumes declined from 845.2 million shares to 620.7 million shares (-27 percent DoD). The average traded value also declined by 26 percent to reach US$ 123.7 million as against US$ 167.7 million.

    Stocks that contributed significantly to the volumes include HUMNL, KEL, FFBL, KAPCO and KOSM, which formed 28 percent of total volumes.

    Stocks that contributed positively to the index include KAPCO (+23 points), SYS (+20 points), COLG (+15 points), GHGL (+13 points) and PAKT (+13 points). Stocks that contributed negatively include OGDC (-34 points), ENGRO (-18 points), HUBC (-17 points), PPL (-16 points) and POL (-14 points).

  • Country’s foreign exchange reserves inch up

    Country’s foreign exchange reserves inch up

    KARACHI: The liquid foreign exchange reserves of the country slightly increased by $7 million to $20.519 billion by the week ended January 08, 2021, the State Bank of Pakistan (SBP) said on Thursday.

    The foreign exchange reserves of the country were at $20.512 billion by the week ended December 31, 2020.

    The official reserves of the SBP slipped by $12 million to $13.4 billion by the week ended January 08, 2021, as compared with $13.412 billion a week ago.

    The foreign exchange reserves maintained by the commercial banks increased by $19 million to $7.119 billion by the week ended January 08, 2021, as compared with $7.1 billion a week ago.

  • Rupee gains 17 paisas on improved inflows

    Rupee gains 17 paisas on improved inflows

    KARACHI: The Pak Rupee gained 17 paisas against the dollar on Thursday owing to inflows of export receipts and workers’ remittances, dealers said.

    The rupee ended Rs160.18 to the dollar from previous day’s closing of Rs160.35 in the interbank foreign exchange market.

    The dealers said that the market witnessed sufficient supply of the greenback during the day, which helped the rupee to gain value.

    The dealers said that the sentiments were remained positive due to significant improvement in export receipts during first six months of the current fiscal year.

  • Oil production falls by 6 percent in second quarter of current fiscal year

    Oil production falls by 6 percent in second quarter of current fiscal year

    KARACHI: Pakistan’s Oil production fell by 6 percent year on year (YoY) during second quarter of the current fiscal year to 76,331 barrels of oil per day, analysts said on Thursday.

    This has been attributed to decline in production of Tal block fields like Mardankhel and Makori Deep by 27 percent and 31 percent YoY, respectively. Oil production during 1HFY21 fell at the same rate of 6 percent YoY.

    Production from Chanda, Maramzai, and Makori East increased in range of 5-46 percent YoY. Chanda’s production increased due to induction of Chanda-5 well. Production from Nashpa increased 7 percent QoQ as field was on an annual turnaround in the last quarter (Sep 03-09, 2020).

    As per PPIS data, five new fields were inducted to production line during 2QFY21 namely Baqa (300+ bopd; operated by UEP), Saand (100+ bopd; operated by OGDC), Tando Allay Yar SW (90+ bopd; operated by OGDC), Bolan East (800+bopd; operated by MARI) and Mangrio (200+bopd; operated by OGDC).

    Pakistan gas production declined by 4 percent YoY to 3,409 mmcfd as flows from KPD, Kandhkot and Qadirpur fell in the range of 6-18 percent. During 1HFY21, production declined by 3 percent YoY.

    During 2QFY21, Kandkhkot field’s production declined due to lesser offtake from Gencos. Mari field filled those Kandhkot fields flows as depicted from 12 percent YoY increase in its production.

    Four new fields were added to production line, namely Saand (7+ mmcfd; operated by OGDC), Tando Allah Yar SW (9+ mmcfd; operated by OGDC) and Mangrio (3+ mmcfd; operated by OGDC) and Baqa (1mmcfd, operated by UEPL).

  • PSX issues notice to K-Electric to explains unusual price movement

    PSX issues notice to K-Electric to explains unusual price movement

    KARACHI: Pakistan Stock Exchange (PSX) on Thursday issued notice to K-Electric Limited to explain unusual movement in its price and volume during past few days trading.

    The stock exchange said that under Section 97 of the Securities Act, 2015 and clause 5.6.3 of the PSX Regulations whereby the listed companies are required to respond promptly by disclosing the following to the public if there are unusual movements in the price or volume of its traded securities is observed:

    (a) Details of any matter or development of which it is aware that is or may be relevant to the unusual movements, or

    (b) A statement of the fact that it is not aware of any such matter or development.

    The PSX observed that reviewing the trading data of the company, it had been noted that the volume of KEL had experienced substantial increase during the last few days.

    “Please not that in case of any material/price-sensitive information that is likely to affect the market price/volume, you [the company] are required to share the same the exchange for its onward dissemination to all market participant as prescribed under clause 5.6.1 of the PSX Regulations.”

    In view of the above and in the absence of any material announcement of the company, you [the company] are advised to furnish the reason and/or any material information in company’s knowledge which may have resulted in substantial increase in volume in terms of clause 5.6.3 of PSX Regulations and Section 97 of the Securities Act, 2015 immediately, through PUCARS for information of all market participants.

  • CDC successfully processes dividends through RAAST payment gateway

    CDC successfully processes dividends through RAAST payment gateway

    KARACHI: Central Depository Company (CDC) has successfully processed the Cash dividend of “Pak Datacom Limited” through State Bank’s RAAST payment gateway, a statement said on Wednesday.

    It is indeed a moment to celebrate for both CDC and Pak Datacom Limited as both the companies were the first entities to utilize the services of Pakistan’s new and fastest payment gateway of RAAST (inaugurated by honorable Prime Minister Imran Khan on Monday, Jan 11, 2021).

    CDC is working with SBP on this project for the last 1 year to make this possible. CDC is now connected with all major banks on RAAST, and will process all dividend payments more efficiently and cost-effectively.

    Speaking at the occasion CEO CDC, Badiuddin Akbar, said: “It is indeed a landmark achievement that Raast has now been launched and operational with CDC on-board for the processing of all Dividend Disbursement transactions which will extend valuable process improvements in terms of transparency, security, efficiency and cost-effectiveness.

    “We are confident that with the help of Raast, there would be a complete transformation of the payment landscape of Pakistan.”

    CDC is thankful to SBP and SECP for their continued support and patronage in achieving yet another milestone in its market transformation journey. CDC is already processing thousands of transactions related to Roshan Digital Accounts in Stock Exchange, where again SBP placed its trust on CDC to act as the bridge between Banks and Capital market entities and to become the gateway for non-residents Pakistanis to invest in Pakistan Stock Exchange (PSX).

    Around 2000 Roshan Digital Account holders are efficiently investing in PSX with an estimated worth of around Rs375 million (around USD 2.5 million) through this arrangement facilitated by CDC.

  • Stock market gains 170 points amid positive reports on banking sector

    Stock market gains 170 points amid positive reports on banking sector

    KARACHI: The stock market gained 170 points on Wednesday on positive sentiments prevailed on a report related to banking sector.

    The benchmark KSE-100 index of Pakistan Stock Exchange (PSX) closed at 46,092 points as against last day’s closing of 45,922 points showing an increase of 170 points.

    Analysts at Arif Habib Limited said that the market continued the uptrend from yesterday and added another 392 points during the session, closing +170 points.

    Cement, E&P and Banking sectors contributed to the increase in Index. International crude prices supported the positive stance in E&P, which was primarily on account of the consistent draw down in global floating storage of crude products.

    On the other hand, Cement sector performed in anticipation of better results from the outgoing quarter.

    Last half hour of the session saw Moodys issuing positive statement on Pakistani banks that helped the banking sector perform relatively better. Among scrips, KEL posted trading volume of 110.5 million shares, followed by PIBTL (79.6 million) and POWER (45 million).

    Sectors contributing to the performance include Technology (+79 points), Cement (+74 points), Textile (+49 points), Banks (+43 points) and Engineering (+24 points).

    Volumes increased further from 825.8 million shares to 845.3 million shares (+2 percent DoD). Average trading volumes increased by 27 percent to reach US$ 167.5 million as against US$ 131.8 million.

    Stocks that contributed significantly to the volumes include KEL, PIBTL, POWER, HUMNL and FFL, which formed 35 percent of total volumes.

    Stocks that contributed positively to the index include SYS (+50 points), TRG (+28 points), PIOC (+21 points), HBL (+21 points) and INIL (+20 points). Stocks that contributed negatively include UBL (-25 points), PAKT (-17 points), DAWH (-16 points), MTL (-16 points) and KEL (-15 points).