Money and banking drive economic activity by facilitating transactions, savings, and investments. Banks manage financial resources, offer credit, and regulate money supply, ensuring stability and growth in Pakistan’s financial sector.
Karachi – In a positive turn of events, the Pakistani Rupee demonstrated resilience against the US Dollar on Wednesday, gaining 11 paisas in the interbank foreign exchange market.
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KARACHI: The State Bank of Pakistan (SBP) on Tuesday said that it will review the existing key policy rate at 7 percent on January 22, 2021.
The SBP said that the Monetary Policy Committee of the SBP will on Friday, January 22, 2021 at SBP Karachi to decide about Monetary Policy.
Governor State Bank of Pakistan, Dr. Reza Baqir, will give a press conference on the same day after the MPC meeting.
The SBP in its MPC meeting on November 23, 2020 decided to maintained policy rate at 7 percent.
The SBP decided to maintain policy rate noted that since the last meeting in September, the domestic recovery has gradually gained traction, in line with expectations for growth of slightly above 2 percent in FY21, and business sentiment has improved further.
Nevertheless, there are risks to the outlook. The recent rise in Covid cases in Pakistan and many other countries presents considerable downside risks.
On the upside, while it could take some time to fully implement worldwide, there has been recent encouraging news on vaccine development.
On the inflation front, recent out-turns have been on the higher side, primarily due to increases in food prices. However, these supply-side pressures are likely to be temporary and average inflation is expected to fall within the previously announced range of 7-9 percent for FY21.
Taken together, risks to the outlook for both growth and inflation appear balanced.
KARACHI: Meezan Bank Limited has announced direct integration for routing settlement of Visa card transactions.
A statement on Tuesday said the shift comes in continuation with its direct integration with Mastercard last year, bringing the bank a step closer to its goal of transforming its customers’ payment experience, enabling faster and more seamless transactions.
Meezan Debit Card users will continue to enjoy the Visa and Mastercard benefits while allowing the Bank to offer faster settlements and reducing friction in payments.
Shariq Mubeen, Head of Alternate Distribution Channels, said: “The bank always endeavors to provide the best transaction experience to its customers.
“Direct integration with Global Payment Schemes not only allows us to remove an additional hop in transaction processing but it also makes detailed view of each transaction available to the bank for more efficient management of cards portfolio.
“We are excited with this development and look forward to various others significant improvements in our IT infrastructure and platforms to support the growing business of the Bank.”
KARACHI: The Pak Rupee weakened by 9 paisas against the dollar on Tuesday owing to demand for import and corporate payments, dealers said.
The rupee ended Rs160.61 to the dollar form last day’s closing of Rs160.52 in the interbank foreign exchange market.
The dealers said that the rupee weakened owing to dollar demand for import and corporate payments.
KARACHI: The Pak Rupee fell by 19 paisas against the dollar on Monday owing to demand for import and corporate payments, dealers said.
The rupee ended Rs160.52 to the dollar form last day’s closing on of Rs160.33 in the interbank foreign exchange market.
The dealers said that the rupee weakened owing to dollar demand for import and corporate payments. They said that the demand was seen because the market opened after two weekly holidays.
Karachi: The Pak Rupee came down by 15 paisas against the dollar on Friday due to demand for import and corporate payments ahead of weekly holidays.
The rupee ended Rs160.33 to the dollar from the previous day’s closing of Rs160.18 in the interbank foreign exchange market.
The demand for the dollar was remained high during the day due to the next two days weekly holidays. The dealers said that the market had seen the demand for advance payment from importers and corporate buyers.
They said that the inflows of workers’ remittances and export receipts were remained encouraging in the current fiscal year, which would help the rupee gain value in the coming days.
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.
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.
KARACHI: The Pak Rupee gained two paisas against the dollar on Wednesday amid higher demand for import and corporate payments.
(more…)KARACHI – The Pakistani Rupee saw a slight recovery on Tuesday, appreciating by two paisas against the US Dollar despite increased demand for imports and corporate payments. The rupee closed at Rs160.37 per dollar in the interbank foreign exchange market, improving from the previous day’s closing rate of Rs160.39.
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