Fixed Rate PIBs underwhelm in Auction

August 19, 2020 (MLN): The State Bank of Pakistan (SBP) conducted an auction on Wednesday in which it sold PIBs (Fixed Coupon Rate) worth Rs.44.850 billion.

The SBP received bids worth Rs.108.108 billion for 3, 5, 10, 15 and 20 years against an auction target of Rs.140 billion.

Cut off Yields were up for 5, 15 and 20 year PIBs by 8, 23 and 15 basis points while the 10 year cut off remained unchanged.

While the Cut off Yield for the 3 year PIB was up 83 basis points, that has more to do with this being a fresh issue with a longer maturity that the previously reopened 3 year PIB.

The SBP received bids worth Rs.41.215 billion for 3 year, 33.688 billion for 5 years, 11.205 billion for 10 years, Rs.12.00 billion for 15 years and Rs.10 billion for 20 years out of which it accepted Rs.16.6 billion for 3 years, the full amount for 15 and 20 years while only accepting Rs.187 million and Rs.55 million for 5 and 10 years.

In addition the SBP picked up Rs.6.0 billion in non-competitive bids and through short selling making the total accepted amount Rs.44.85 billion.

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