January 14, 2008	Monday	Muharram 04, 1429

On January 12, banks borrowed Rs43 billion, as the total borrowing from the State Bank of Pakistan reached Rs90 billion in the week. Overnight rate was 9.9 per cent just below the discount rate.

The liquidity crunch was the outcome of the State Bank’s policy to keep the market dry in fear of inflationary pressure coming out from the inflows of dollars and building up of reserve money.

According to the Statement of Affairs of the State Bank of Pakistan, for the week ended July 2December 29, 2007, both notes in circulation and those issued increased in the week. Notes in circulation stood at Rs1,076,328.618 million against earlier week’s figure of Rs1,065,595.452 million, a rise of Rs10,733.166 million. When compared to the corresponding week a year ago when it was Rs917,808.920 million, the current week’s figure is higher by Rs158,519.698 million.

Total notes issued also rose in the current week over preceding week’s level. At Rs1,076,516.350 million it was larger by Rs10,792.013 million over the figure of Rs1,065,724.337 million recorded a week earlier. In the corresponding week last year it amounted to Rs917,949.859 million, which shows current week’s figure to be higher by Rs158,566.491 million over last year’s corresponding figure.

Approved foreign exchange increased in the week to Rs686,249.757 million or by Rs9,697.355 million over preceding week’s figure of Rs676,552.402 million. When compared to the corresponding week a year ago, when the figure was Rs549,364.900 million, the current week’s figure is higher by Rs136,884.857 million.

Balances held outside Pakistan in approved foreign exchange increased in the week under review. It stood at Rs151,435.539 million over preceding week’s figure of Rs145,258.925 million, a rise of Rs6,176.614 million. Compared to last year’s corresponding figure of Rs128,433.716 million, the current week’s figure is larger by Rs23,001.823 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 Rs57,776.510 million, against preceding week’s figure of Rs57,855.896 million, showing a decline of Rs79.386 million. The current week’s figure is smaller by Rs5,407.018 million over last year’s corresponding figure of Rs63,183.528 million.

There was an inflow of Rs40,386.319 million to the industrial sector during the week under review, a fall of Rs104.416 million against preceding week’s figure of Rs40,490.735 million. When compared to last year’s corresponding figure of Rs41,382.455 million, the current week’s figure is lower by Rs996.136 million.

The export sector received Rs100,060.121 million against previous week’s figure of Rs100,275.858 million, smaller by Rs215.737 million. Current week’s figure was smaller by Rs31,673.487 million over last year’s corresponding figure of Rs131,733.608 million.

According to the weekly statement of position of all scheduled banks for the week ended December 29, 2007, deposits and other accounts of the scheduled banks stood at Rs3,565.537 billion, larger by Rs48.974 billion over preceding week’s figure of Rs3,516.563 billion. Commercial banks deposits showed an increase of Rs50.343 billion over the week to Rs3,553.008 billion, against preceding week’s Rs3,502.665 billion. Specialised banks deposits stood at Rs12.529 billion, against preceding week’s Rs13.899 billion, a fall of Rs1.37 billion.

Borrowings by all scheduled banks decreased during the week over preceding week’s figure. It fell to Rs439.335 billion over preceding week’s figure of Rs478.675 billion, a fall of Rs39.34 billion. This was primarily due to a decline in the borrowings by commercial banks, which fell to Rs358.328 billion against previous week’s Rs395.843 billion, or by Rs37.515 billion. Borrowings by specialised banks stood at Rs81.007 billion, against preceding week’s figure of Rs82.832 billion, a fall of Rs1.825 billion.

Gross advances stood at Rs2,651.173 billion in the week under review, an increase of Rs17.784 billion over preceding week’s figure of Rs2,633.389 billion. Advances by commercial banks rose to Rs2,555.676 billion against earlier week’s figure of Rs2,530.165 billion, or by Rs25.511 billion. Advances of specialized banks stood at Rs95.496 billion, smaller by Rs7.728 billion over earlier week’s figure of Rs103.224 billion.

Investments of all scheduled banks further decreased in the week by Rs18.145 billion to Rs1,210.920 billion against preceding week’s figure of Rs1,229.065 billion. Commercial banks investment declined to Rs1,198.156 billion, from earlier week’s Rs1,212.943 billion, or by Rs14.787 billion. Specialized banks investment stood at Rs12.764 billion, against preceding week’s Rs16.122 billion, smaller by Rs3.358 billion.

Cash and balances with treasury banks of all scheduled banks rose by Rs8.854 billion during the week to stand at Rs343.718 billion against earlier week’s Rs334.864 billion. The figure for commercial banks stood at Rs341.092 billion against preceding week’s figure of Rs332.147 billion, a rise of Rs8.945 billion, while of specialised banks it stood at 2.627 billion over previous week’s 2.717 billion.

Total assets of scheduled banks stood at Rs4,828.576 billion, larger by Rs22.462 billion, over preceding week’s figure of Rs4,806.114 billion. Meanwhile, commercial banks assets stood at Rs4,713.493 billion, larger by Rs28.555 billion over previous week’s figure of Rs4,684.938 billion. Specialised banks assets declined to Rs115.083 billion, or by Rs6.093 billion over previous week’s Rs121.176 billion.