KARACHI, April 15, 2026 — Pakistan’s commercial banks aggressively participated in the latest treasury bill auction on Wednesday, submitting bids worth more than Rs4 trillion against a government target of Rs1.35 trillion, underscoring ample liquidity in the banking system.
According to auction results released by the State Bank of Pakistan (SBP), bids were received for 1-, 3-, 6- and 12-month treasury bills, with a total realized value of Rs4.12 trillion and a face value of Rs4.25 trillion.
The SBP ultimately accepted bids (including non-competitive offers) worth Rs1.44 trillion at realized value and Rs1.49 trillion in face value, using the proceeds to help finance the government’s budget deficit.
Market participants said the strong oversubscription reflects significant excess liquidity held by banks, alongside continued reliance on government securities as a low-risk investment avenue.
READ MORE: Bank deposits in Pakistan hit record Rs37.51 trillion: SBP
The auction comes amid broader strength in Pakistan’s banking sector, with deposits rising to a record Rs37.51 trillion by the end of March 2026. The increase highlights sustained financial inflows despite recent monetary easing by the central bank.
The SBP has reduced its benchmark policy rate by a cumulative 10.50 percentage points from 22% over recent policy cycles, aiming to support economic activity and control inflationary pressures. However, analysts say liquidity remains elevated due to cautious private-sector credit demand and increased government borrowing from banks.
Bank advances also recorded a modest rise to Rs14.55 trillion in March 2026, compared with Rs14.53 trillion in February and Rs13.47 trillion in March 2025, indicating gradual credit expansion.
Meanwhile, commercial banks’ total investments stood at Rs39.13 trillion, slightly lower than the previous month but significantly higher than Rs32.38 trillion a year earlier, reflecting strong year-on-year growth in sovereign and fixed-income portfolios.
Analysts said the heavy participation in the T-bill auction also suggests that market expectations for further policy rate cuts have moderated in the near term, particularly amid renewed geopolitical risks and inflationary pressures.
They added that banks continue to prefer government securities over private lending, reinforcing the government’s ability to finance its fiscal deficit through domestic borrowing.