SBP raises Rs293.64bn through PIB-PFL auction

January 24, 2024 (MLN): The State Bank of Pakistan (SBP) conducted an auction on Wednesday in which it sold Pakistan Investment Bond – Floating Rate (PIB-PFL) semiannual and quarterly worth Rs293.638 billion for 2, 3, 5 and 10 years against a target of Rs280bn.

SBP received bids worth Rs674.248bn for PIB-PFL semiannual and Rs28.844bn for PIB-PFL quarterly, out of which the central bank accepted Rs267.438bn and Rs26.2bn respectively.

The amount raised through PIB-PFL quarterly comes entirely from the 3-year tenure bond as the central bank did not accept bids for the 2-year quarterly PIB.

The total amount of Rs26.2bn raised through PIB-PFL quarterly includes Rs25bn raised through competitive bids and the remaining Rs1.2bn through non-competitive bids.

Additionally, Rs107.538bn was raised through the 5-year PIB-PFL semiannual, while Rs159.9bn was raised through the 10-year semiannual bond.

The total sum raised through 5-year and 10-year semiannual bonds represents Rs260.448bn raised by SBP through competitive bids and the remaining Rs6.99bn raised through non-competitive bids.

The cut-off price for the 3-year PIB-PFL quarterly was Rs98.1357.

While for the PIB-PFL semiannual, the cutoff was Rs96.5915 for the 5-year bond and for the 10-year one it stood at Rs94.8122.

The settlement date for the successful bids is January 25, 2024.

To note, the target for the PIB-PFL semiannual was to raise Rs120bn through the sale of 5-year and 10-year PIB, Rs60bn each.

In the case of PIB-PFL quarterly, it was to raise Rs160bn with the sale of 2-year and 3-year PIB-FRF, Rs80bn each.

The central bank, in the last auction held on January 10 sold PIBs-PFL worth Rs173.8bn for 2, 3, 5 and 10 years against a target of Rs280bn.

The cut of price stood at Rs98.147, Rs96.4921 and Rs94.4061 for the 3-year PIB-PFL quarterly, 5-year and 10-year PIB-PFL semiannual respectively.

When compared with today's cut-off price, it becomes evident that yields have decreased, resulting in a slight increase in the cut-off price.

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