Qudsia Bano

The State Bank of Pakistan (SBP) conducted auctions for Pakistan Investment Bonds (PIBs) and Market Treasury Bills (MTBs) on September 3, 2025, mobilizing more than Rs 527 billion from the banking system. The settlement date for both auctions was set for September 4, 2025.

According to auction results, the SBP raised Rs 36.7 billion through the sale of 10-year floating rate PIBs. Out of the total face value of Rs 444 billion offered, bids worth Rs 28 billion were accepted on a competitive basis, while an additional Rs 8.7 billion came through non-competitive bids. The cut-off price was set at 95.5344, with the realized amount standing at Rs 26.77 billion, supplemented by Rs 464 million in accrued interest.

Meanwhile, the government secured Rs 491.1 billion through the auction of short-term treasury bills of various maturities. The one-month tenor attracted the most participation, with accepted bids totaling Rs 125.6 billion against a face value of Rs 126.6 billion. For the three-month papers, Rs 171.6 billion was raised, followed by Rs 43.5 billion for six-month and Rs 150.2 billion for twelve-month instruments.

Cut-off yields reflected stability across the board, with the one-month set at 10.7512 percent, three-month and six-month both at 10.8501 percent, and the twelve-month at 10.9999 percent. Weighted average yields were slightly higher, standing at 10.7267 percent for one-month, 10.8295 percent for three-month, 10.8260 percent for six-month, and 10.9835 percent for twelve-month bills.

The combined outcome highlights the government’s strategy of balancing short-term borrowing needs with long-term funding through investment bonds. Analysts note that participation in both PIBs and MTBs reflects continued liquidity in the banking sector, although the reliance on short-term papers remains significant.

Credit: INP-WealthPk