Foreign Net Selling Via SCRA rises by 66.5% during last week

September 27, 2018 (MLN): As per data released by State Bank of Pakistan (SBP) on Special Convertible Rupee Accounts (SCRA), for the week ending September 21, 2018, foreign investors remained net sellers at the capital markets.

During the week, net sale of securities increased by around 66.5% on a week-on-basis as it has been recorded Rs.2.3 billion, compared to a net selling worth of Rs.1.4 billion reported during the previous week.

On the whole, the sale of securities by foreign investors increased by 27% or Rs.1.144 billion over the previous week after being recorded at Rs.5.4 billion compared to Rs.4.3 billion a week before, while the purchase of securities by foreign investors also increased by 8.2%, or Rs.241 million after being recorded at Rs.3.2 billion compared to Rs.2.9 billion during the week before.

Special Convertible Rupee Accounts cater to the needs of non-resident investors, who wish to trade freely in the shares quoted on the Stock Exchange of Pakistan.

Operation of SCRA accounts is up to an extent of remittances received from abroad or by transfer from a Foreign Currency Account maintained by non-resident investors in Pakistan.

The balance available therein can be used for purchase of any shares quoted on the country’s secondary markets i.e. Pakistan Stock Exchange. The disinvestment proceeds against the sale of previously purchased shares through SCRA can be credited in this account, in addition to dividend income against the shares held by non-resident investors.

The funds available in such accounts can be transferred outside Pakistan or credited to a foreign currency account of non-resident investor maintained in Pakistan at any time without prior approvals of the State Bank of Pakistan.

According to the latest statement issued by SBP, remittances coming into the SCRA account stood at Rs.635 million, while those leaving the account were recorded at Rs.3.1 billion. Compared to the prior week ending on September 14, 2018, remittances coming into the SCRA accounts by September 21st  fell by Rs.189 million, whereas  those leaving the SCRA accounts, increased by Rs.262 million.

Income from dividends credited into the SCRA account fell by 96% or Rs.177 million, after being recorded at Rs.7 million, compared to Rs.184 million the week before.

Closing position of SCRA accounts were reported at Rs. 25.2 billion, slightly down from the Rs. 25.4 billion reported a week before.

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