KARACHI, June 16: The federal government has assured investors that it will not take any step that could affect the available liquidity of the banking sector.

The finance division sent the clarification to the Karachi Stock Exchange (KSE) on Monday regarding a news item appearing in a section of press the previous day that the government intended to withdraw deposits from commercial banks and to entrust them with the State Bank.

The clarification maintained the government was very conscious that sufficient liquidity must remain available with the banking industry to meet the requirement of the private sector and to finance economic activities.

The statement, however, added that the government would like to optimise returns on its funds and to ensure that they were utilised for the purpose for which they were allocated.—APP