The State Bank of Pakistan plans to raise Rs15 billion through an auction of long term government bonds later this month. The 3,5,10 15 and 20 years PIBs carry annual coupons of 9.1,9.3,9.6,10.0 and 10.5 per cent respectively.

While the 30 year paper carries a coupon of 11 per cent. This will be the third PIB auction to be conducted by the government in the 2007 -08 fiscal year.

On October 19, the SBP conducted a reverse repo and injected Rs40.9 billion in the banking system. Banks were short of cash after Eid. The SBP offered money to banks at 9.50 percent annual rate of return.

According to the Statement of Affairs of the State Bank of Pakistan, for the week ended July 2October 06, 2007, both notes in circulation and those issued increased in the week. Notes in circulation stood at Rs964,222.611 million against earlier week’s figure of Rs927,989.908 million, a rise of Rs36,232.703 million. When compared to the corresponding week a year ago when it was Rs826,573.610 million, the current week’s figure is higher by Rs101,416.298 million.

Total notes issued also increased in the current week over preceding week’s level. At Rs964,367.186 million it was larger by Rs36,184,141 million over the figure of Rs928,183.045 million recorded a week earlier. In the corresponding week last year it amounted to Rs826,726.820 million, which shows current week’s figure to be higher by Rs137,640.366 million over last year’s corresponding figure.

Approved foreign exchange increased in the week to Rs742,554.701 million or by Rs52,264.674 million over preceding week’s figure of Rs690,290.027 million. When compared to the corresponding week a year ago, when the figure was Rs520,413.451 million, the current week’s figure is higher by Rs222,141.25 million.

Balances held outside Pakistan in approved foreign exchange declined in the week under review. It stood at Rs135,814.918 million over preceding week’s figure of Rs183,923.760 million, a fall of Rs48,108.482 million. Compared to last year’s corresponding figure of Rs131,937.373 million, the current week’s figure is larger by Rs3,877.545 million.

Loans and advances of scheduled banks to the three sectors – agricultural, industrial and export showed a mixed trend in the week under review. The agricultural sector received Rs57,955.896 million, similar to preceding week’s figure. The current week’s figure is smaller by Rs4,726.889 million over last year’s corresponding figure of Rs62,682.785 million.

There was an inflow of Rs39,443.993 million to the industrial sector during the week under review, a decline of Rs570.733 million against preceding week’s figure of Rs40,014.726 million. When compared to last year’s corresponding figure of Rs8,246.282 million, the current week’s figure is higher by Rs31,197.711 million.

The export sector received Rs100,303.798 million against previous week’s figure of Rs100,461.179 million, a fall of Rs157.381 million. Current week’s figure was smaller by Rs12,960.413 million over last year’s corresponding figure of Rs113,264.211 million.

According to the weekly statement of position of all scheduled banks for the week ended October 06, 2007, deposits and other accounts of the scheduled banks stood at Rs3,445.496 billion, smaller by Rs19.191 billion over preceding week’s figure of Rs3,464.687 billion. Commercial banks deposits showed a decline of Rs19.336 billion over the week to Rs3,433.276 billion, against preceding week’s Rs3,452.612 billion. Specialized banks deposits stood at Rs12.220 billion, against preceding week’s Rs12.075 billion, a rise of Rs0.145 billion.

Borrowings by all scheduled banks increased during the week over preceding week’s figure. It rose to Rs398.155 billion over preceding week’s figure of Rs394.459 billion, a rise of Rs3.696 billion. This was primarily due to a rise in the borrowings by commercial banks, which rose to Rs317.162 billion against previous week’s Rs313.178 billion, or by Rs3.984 billion. Borrowings by specialized banks stood at Rs80.993 billion, against preceding week’s figure of Rs81.281 billion, a fall of Rs0.288 billion.

Gross advances stood at Rs2,451.226 billion in the week under review, an increase of Rs0.513 billion over preceding week’s figure of Rs2,450.713 billion. Advances by commercial banks rose to Rs2,356.231 billion against earlier week’s figure of Rs2,355.421 billion, or by Rs0.81 billion. Advances of specialized banks stood at Rs94.995 billion, smaller by Rs0.298 billion over earlier week’s figure of Rs95.293 billion.

Investments of all scheduled banks increased in the week by Rs5.16 billion to Rs1,250.571 billion against preceding week’s figure of Rs1,245.411 billion. Commercial banks investment rose to Rs1,236.049 billion, from earlier week’s Rs1,231.151 billion, larger by Rs4.898 billion. Specialized banks investment stood at Rs14.522 billion, against preceding week’s Rs14.260 billion, larger by Rs0.262 billion.

Cash and balances with treasury banks of all scheduled banks declined by Rs12.588 billion during the week to stand at Rs344.176 billion against earlier week’s Rs356.764 billion. The figure for commercial banks stood at Rs341.712 billion against preceding week’s figure of Rs354.227 billion, a fall of Rs12.515 billion, while of specialised banks it stood at 2.464 billion over previous week’s 2.537 billion.

Total assets of scheduled banks stood at Rs4,630.693 billion, smaller by Rs29.704 billion, over preceding week’s figure of Rs4,660.397 billion. Meanwhile, commercial banks assets stood at Rs4,517.434 billion, smaller by Rs27.718 billion over previous week’s figure of Rs4,545.152 billion. Specialized banks assets rose to Rs113.258 billion, or by Rs1.986 billion over previous week’s Rs115.244 billion.