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Tag: State Bank of Pakistan

  • Remittances grow to $20.19 billion in 11 months

    Remittances grow to $20.19 billion in 11 months

    KARACHI: Overseas Pakistanis workers have sent $20.19 billion during July – May 2018/2019 as compared $18.28 billion in the same period of the last fiscal year, showing growth of 10.42 percent, State Bank of Pakistan (SBP) on Friday.

    The central bank said that during May 2019, the inflow of worker’s remittances amounted to $2315.74 million, which is 30.17 percent higher than April 2019 and 28.36 percent higher than May 2018.

    The country wise details for the month of May 2019 show that inflows from Saudi Arabia, UAE, USA, UK, GCC countries (including Bahrain, Kuwait, Qatar and Oman) and EU countries amounted to US $493.73 million, $476.57 million, $346.81 million, $387.09 million, $237.76 million and $70.61 million, respectively compared with the inflow of $432.05 million, $373.85 million, $290.26 million, $269.11 million, $178.96 million and $60.34 million respectively in May 2018.

    Remittances received from Malaysia, Norway, Switzerland, Australia, Canada, Japan and other countries during May 2019 amounted to $303.17 million together as against $199.51 million received in May 2018.

  • Foreign exchange reserves slip to $14.827 billion

    Foreign exchange reserves slip to $14.827 billion

    KARACHI: The total foreign exchange reserves of the country have slipped by $63 million to $14.827 billion by week ended June 03, 2019 as compared with $14.89 billion as on May 31, 2019, State Bank of Pakistan (SBP) said on Thursday.

    The official foreign exchange reserves of the SBP reduced by $55 million to $7.807 billion by week ended June 03, 2019 as compared with $7.862 billion on May 31, 2019.

    The central bank said that its reserves were declined due to payments on account of external debt servicing.

    The reserves held by commercial banks also fell by $8 million to $7.019 billion from $7.027 billion.

  • Budget 2019/2020: No SBP borrowing from July 01

    Budget 2019/2020: No SBP borrowing from July 01

    ISLAMABAD: The government has decided not to borrow from State Bank of Pakistan (SBP) from July 01, 2019 due to high inflation concerns.

    State Minister for Revenue Hammad Azhar while presenting budget 2019/2020 has said that the government would take all possible measures for minimal increase in prices.

    If, however due to movement in international markets we are forced with any price increase we will ensure that consumers are protected to the extent possible.

    Accordingly, we have made budgetary allocations to enhance social safety net for the vulnerable population.

    Fighting inflation will be paramount for us. “We will tailor our fiscal and monetary policies, coordinate with the provinces and adopt administrative measures to fight this menace.”

    The measures proposed for 2019-2020 budget shall be as follows:

    Government borrowing from the State Bank is inflationary, the government will no longer use this facility with effect from 1 July 2019

    Our medium-term inflation target will be in the range of 5 – 7 percent.

    In addition, we will continue to focus on good governance and remain committed to fighting corruption. We will assign autonomy to our institutions, strengthen their capacity and choose their leadership on merit.

    The year 2019-20 shall continue to be the period of stabilization. This is a difficult transition that we want to achieve within a minimum amount of time. We will try to minimize the adverse effects of any difficult decisions on our citizens.

  • Government borrows Rs3.2 trillion from SBP in 10 months: Economic Survey

    Government borrows Rs3.2 trillion from SBP in 10 months: Economic Survey

    ISLAMABAD: The government has borrowed Rs3.2 trillion from State Bank of Pakistan (SBP) for budget financing during first ten months of current fiscal year, Economic Survey of Pakistan revealed.

    The survey released a day earlier stated that during July 01, 2018-April 26, 2019 government borrowed Rs 1,073.0 billion for budgetary support compared to Rs 850 billion in the same period last year, of which, government has borrowed from SBP Rs 3,204.7 billion as compared to Rs 1,316.1 billion last year.

    On the other hand, government retired Rs 2,131.7 billion to scheduled banks against retirement of Rs 466.1 billion in last year. Net government sector borrowing thus remained at Rs 908.0 billion during the period under review compared with Rs 813.6 billion last year.

    During the period 01 Jul-26 Apr, FY2019 money supply (M2) increased by Rs 625.3 billion (growth of 3.9 percent) compared with Rs 601.8 billion (4.1 percent) in comparable period of last year.

    Net Domestic Assets (NDA) is the main contributor to M2 growth.

    Net Foreign Assets (NFA) point contribution is negative and stood at (-5.5 percent) during the period under review compared with (-3.3 percent) in the same period last year.

    NDA point contribution has increased to 9.4 percent compared with 7.4 percent last year. NDA point contribution growth partially offset by NFA negative growth, thus overall money supply grew by 3.9 percent during the period under review.

    On the other hand, reserve money posted an expansion of Rs 488.0 billion (growth of 8.9 percent) during 01 Jul-26 Apr, FY2019 against Rs 260.5 billion (5.4 percent) last year.

    SBP’s NDA posted a growth of 22.5 percent compared with 18.18 percent during the same period last year, whereas, SBP’s NFA decreased by Rs 743.8 billion compared with contraction of Rs 473.7 billion in the comparable period last year.

    Therefore, reserve money growth stemmed from NDA of the SBP whereas NFA outstanding stock remained negative during the period under review.

    Within Broad Money, NFA of the banking sector further contracted to Rs 882.4 billion during 01 Jul-26 Apr, FY2019. During same period last year, it was contracted by Rs 475.4 billion.

    Therefore, SBA and scheduled bank’s NFA remained negative during the period under review.

    During the period 01 Jul-26 Apr, FY2019 NDA of the banking sector registered an expansion of Rs 1,507.7 billion (growth of 9.3 percent) compared with Rs 1,077.2 billion (7.7 percent) during the comparable period last year.

    NDA of SBP increased by Rs 1,132.5 billion as compared with Rs 661.5 billion during same period last year.

    The NDA of scheduled banks witnessed an expansion of Rs 375.1 billion compared to expansion of Rs 415.7 billion in the same period of last year.

    Government sector borrowing and private sector credit mutually impacted NDA growth of the banking system, which was more than offset the contraction in NFA of the banking system.

    Consequently, broad money growth increased to 3.9 percent during 01 Jul-26 Apr, FY2019 as compared to 4.1 percent during the comparable period last year.

    Credit to Public Sector Enterprises (PSEs) increased by Rs 312.1 billion during the period 01 Jul-26 Apr, FY2019 against Rs 153.2 billion during the same period of last year.

  • Economic Survey 2018/2019: SBP increases policy rate by 650bps in past 18 months

    Economic Survey 2018/2019: SBP increases policy rate by 650bps in past 18 months

    ISLAMABAD: State Bank of Pakistan (SBP) enhanced policy rate by 650 basis points during last 18 months (January 2018 to date) for macroeconomic stabilization.

    According to Economic Survey 2018/2019 issued by the ministry of finance on Monday said the SBP had adopted policy rate reversal and gradually increased it by a cumulative 650 bps since January, 2018.

    “Despite increase in policy rate, Weighted Average Lending Rate (WALR) remained stable which translated into healthy private sector credit demand.”

    Credit to private sector (CPS) increased to Rs 775.5 billion during FY2018 against Rs 747.9 billion last year. Significant increase in credit demand primarily came from working capital and fixed investment in the preceding year.

    During the period July-March, FY2019 CPS increased to Rs 554.7 billion compared with Rs 401.1 billion during same period of last year.

    Of which working capital loans received the major share and stood at Rs 369.0 billion compared to Rs 215.3 billion last year. While fixed investment decelerated to Rs 83.1 billion against Rs 148.1 billion in the comparable period last year.

    The survey said that the monetary policy is an important tool to achieve price stability and manage economic fluctuations.

    Inflation targeting has emerged as the leading framework for monetary policy over recent decades in many advanced and in low income economies.

    Monetary policy role after global financial crises has extended as macro prudential policy which required strong institutional framework for financial stability and to achieve twin objectives of price and output stabilization.

    Pakistan’s economy witnessed a consumption led growth of 5.53 percent during preceding year FY2018.

    The incumbent government has inherited the economy facing multiple challenges including unsustainable twin deficits that pose serious risks to the economy.

    Hence, to correct the imbalances in the economy, authorities have taken steps to curtail the fiscal deficits and tighten monetary policy to contain demand.

    SBP has significantly tightened monetary policy, and allowed greater flexibility in the exchange rate adjustments to curb excessive aggregate demand and move towards macroeconomic stabilization.

    This trend is in line with the global trends. The global economic expansion has weakened and projected to slow down from 3.6 percent in 2018 to 3.3 in 2019, before returning to 3.6 percent in 2020.

    Following a notable tightening of global financial conditions during second half of 2018, conditions have eased in early 2019 as the US Federal Reserve signaled a more accommodative monetary policy stance and markets became more optimistic about a US–China trade deal.

    The US federal funds rate is expected to increase to about 2.75 percent by the end of 2019. Policy rates are assumed to remain at close to zero in Japan through 2020 and negative in the Euro area until mid-2020.

  • FBR acquires information of account holders having deposits Rs0.5 million from SBP

    FBR acquires information of account holders having deposits Rs0.5 million from SBP

    ISLAMABAD: Federal Board of Revenue (FBR) to acquire information of bank account holders having deposits above Rs0.5 million from the State Bank of Pakistan (SBP), sources said on Tuesday.

    The details of account holders would be obtained for the purpose of broadening of tax base.

    The exercise started after a letter was received by the FBR from the office of Prime Minister. Prime Minister Imran Khan expressed concerns over narrow taxation base, low tax-to-GDP ratio, systematic aberrations in the taxation system and has desired that concerted efforts should be put in to increase taxation base.

    In this regard Member Inland Revenue (Operation) issued directives to all the Chief Commissioners and Director General Broadening of Tax Base for taking following measures.

    01. Data of banks account holders above the threshold of Rs500,000 should be examined with the assistance of the State Bank of Pakistan (SBP).

    02. Data of all industrial and commercial power connections should be obtained from Distribution Companies (DISCOs) and meaningfully extrapolated to ensure filing of tax returns by all concerned.

    03. Information about all owner/tenants living in houses of two kanals or more should be obtained.

    04. Information about all persons owning luxury vehicles of 2400CC and above should be scrutinized objectively.

    Information about frequent foreign travelers should be analyzed.

    The tax offices have been directed that in addition to the above, existing base line data of all the above areas/indicators along with the targets set by field formations for the tax year 2019/2020 need to be shared by June 11, 2019 as directed by the prime minister.

    The prime minister will review the performance of FBR in the context of the broadening and widening tax base on monthly basis.

  • SBP issues Rs360 billion worth fresh currency notes on Eid-ul-Fitr

    SBP issues Rs360 billion worth fresh currency notes on Eid-ul-Fitr

    KARACHI: The State Bank of Pakistan (SBP) has issued Rs360 billion worth fresh currency notes on the occasion of Eid-ul-Fitr, said a statement on Monday.

    The SBP said that through 16 field offices of its subsidiary SBP-Banking Services Corporation (SBP-BSC), provided fresh banknotes of various denominations aggregating to Rs360 billion, including Rs61 billion of Rs100 and below denominations, via cash counters of banks and SMS service (8877) to general public during Ramazan.

    Out of Rs61 billion, Rs54 billion were issued through the SMS service which was available in 142 cities through more than 1,700 commercial bank branches and 16 field offices of SBP BSC.

    The service catered to more than 3 million people before Eid-ul-Fitr.

    State Bank has also issued a sufficient quantity of fresh notes of higher denominations to banks for smooth ATM operations during the Eid Holidays.

    In this regard, special teams of SBP and SBP BSC officials shall inspect and monitor the working of ATMs across Pakistan to ensure uninterrupted availability of cash to the general public during the Eid holidays.


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  • SBP issues instructions for bank account biometric verification of Pakistanis living abroad

    SBP issues instructions for bank account biometric verification of Pakistanis living abroad

    KARACHI: The State Bank of Pakistan (SBP) on Monday issued instructions for biometric verifications of bank account holders of Pakistanis living abroad.

    The banks are conducting biometric verification of existing customers in compliance of Anti Money Laundering/ Counter Finance Terrorism (CFT) Regimes.

    a. Non-resident Pakistanis (NRPs) as defined in Income Tax Ordinance, 2001 – Chapter 5, Division II, Section 82:

    For customers who fall under the definition of NRP, the bank/ DFI may obtain a signed undertaking from the customer invariably containing the following:

    • Customer’s NRP status along with proof (i.e. copy of valid passport, visa, exit stamp, resident permit, etc.)

    • Copy of valid ID document (CNIC/ NICOP)

    • Account number(s) of the customer’s account(s) maintained with the bank as per customer record

    • Undertaking by the customer to inform the bank of any change in residency status

    The bank/ DFI, after verification of the customer’s signature from its record, shall accordingly update/ reflect the NRP status in the customer profile.

    For such customers, as an alternative to biometric verification, the bank/ DFI may conduct fresh NADRA Verisys using the information provided by the customer.

    b) Resident Pakistanis temporarily outside Pakistan:

    For customers who do not qualify under the definition of NRP, but are currently/ temporarily outside Pakistan for any reason, the bank/ DFI may obtain reasonable evidence/ proof from the customer regarding his/ her absence from the country (i.e. copy of valid passport, visa, exit stamp, resident permit, etc.) and the expected date of return.

    For such customers, as an alternate to biometric verification, the bank/ DFI may conduct fresh NADRA Verisys using the information provided by the customer.

    The bank/ DFI may retain the NADRA Verisys in place of biometric verification until the customer returns, subject to reasonable time limit (not more than six months) to be defined by banks/ DFIs. Biometric verification of such customers shall be done immediately upon the customer’s return to the country.

    c) Joint Accounts- where one account holder is outside Pakistan (NRP/ temporarily):

    For joint account holders, treatment of biometric verification should be done according to the status of respective individual. Biometric verification should be conducted for the joint account holder who is resident Pakistani, while for other joint account holders, the relevant procedure described at (a) and (b) above should be adopted.

    The SBP said that it is again advised that as per the Frequently Asked Questions (FAQs) on Use of Biometric Technology issued by SBP vide BPRD Circular Letter No. 20 dated June 14, 2017, banks/ DFIs may operate accounts on the basis of NADRA Verisys in genuine cases (as provided in FAQ No. 8), provided the bank/ DFI is satisfied and proper reason/ proof is recorded/ retained by the bank/ DFI.

    For such cases in line with Para-3 above, in the absence of biometric verification, bank/ DFI may ensure that requisite identification document has been obtained, marked as ‘original seen’ by their staff and verified through NADRA Verisys. Moreover an undertaking should be obtained from the customer declaring that the particulars provided to the bank/ DFI are correct and that their staff has verified the same. The declaration should be endorsed by the Branch Manager and should be available in the bank’s centralized record.

  • Rs52 million approved as interest free loan for students

    Rs52 million approved as interest free loan for students

    KARACHI: The apex committee for Student Loan Scheme having representation from State Bank of Pakistan, Finance Division (Government of Pakistan) and five major banks (NBP, HBL, UBL, ABL and MCB Bank) has approved Rs 51.987 million as interest-free loans to deserving students for their current year of studies within Pakistan.

    State Bank of Pakistan (SBP) in a statement on Monday said that the amount, approved by Apex Committee, will be given to 966 deserving students of public sector universities across the country, studying in different disciplines of under-graduation, graduation and Ph.D studies for the session 2016-2017.

    The objective of the Student Loan Scheme is to provide financial assistance to the meritorious students having insufficient means.

    The loans are granted for a maximum tenor of 10 years from the date of the disbursement of first installment and repayable in monthly installments after six months from the date of first employment or one year from the date of completion of studies, whichever is earlier.

    National Bank of Pakistan, being the administrator of the Scheme, performs all the functions like receiving and scrutinizing the loan applications, disbursement of loans and their recovery.

    The names of successful students are available at the National Bank of Pakistan’s website: https://www.nbp.com.pk/studentloan/

  • Foreign exchange reserves slipped to $15.09 billion

    Foreign exchange reserves slipped to $15.09 billion

    KARACHI: The foreign exchange reserves of the country have slipped by $36 million to $15.09 billion by week ended May 24, 2019 as compared with $15.126 billion a week ago, State Bank of Pakistan (SBP) said on Thursday.

    The official reserves of the central bank came down by $47 million to $8.01 billion by week ended May 24, 2019 as compared with $8.057 billion a week ago. The SBP attributed the decline in foreign exchange reserves of the central bank to external debt services and other official payments.

    However, the reserves held by commercial banks increased by $11 million to $7.079 billion when compared with $7.068 billion a week ago.