ISLAMABAD, May 11: The management of Pakistan Steel Mills Corporation (PSMC) has decided to return about Rs10 billion outstanding loans to seven commercial banks on May 15.

“Not only this Rs10 billion banks’ loan, we will also be paying back Rs800 million to the government”, said PSMC chairman Lt. Gen. (Retd) Abdul Qayyum.

Talking to Dawn on Thursday, he said that he had invited the presidents and senior officials of the banks, including those of the Habib Bank Limited (HBL), National Bank of Pakistan (NBP) and Muslim Commercial Bank (MCB), on Monday to receive their cheques at a special ceremony to be held in Karachi.

Originally, he said, the PSMC was to repay its loans to the banks in 2013 in seven instalments. “However, since the liquidity position of the steel maker has largely improved, it is decided to pay off all its outstanding loans before the new buyer takes over the management control of the organisation shortly, he added.

Gen Qayyum pointed out that the corporation was now in pretty good shape despite various problems being faced by it. He said that it had been returned to profitability due to the hard work done by both the officers and workers.

Responding to a question, he said that a number of issues had been left on the new management to decide including capacity expansion. According to the previous plans the capacity of the mills was to be enhanced from 1.1 million tons to 1.3 million tons.

He expressed hopes that the new buyer — Russian Magnitogorsk and Saudi Al Tuwairqi and Arif Habib Securities– would run the mills efficiently.

The consortium acquired 75pc stake and management control of the PSMC at the rate of Rs16.80 per share totalling Rs21.68bn.