SBP updates buyback rules for govt securities

February 11, 2025 (MLN): The State Bank of Pakistan (SBP) has issued updated operational instructions for the buyback of Government Securities, including Market Treasury Bills (MTBs) and Pakistan Investment Bonds (PIBs) under MTB Rules 1998 (as amended via S.R.O 1585 (I)/2023) and PIB Rules 2000.

The new guidelines, which supersede the previous instructions outlined in DMMD Circular No. 06 of 2024, aim to streamline the buyback process.

Under the revised framework, SBP will conduct buyback auctions on behalf of the Government of Pakistan, covering various types of PIBs—Zero Coupon, Fixed, and Floater—alongside MTBs.

The central bank will announce auction details, including security types, target amounts, schedules, and results, through its pages on Refinitiv and Bloomberg, as well as its official website.

Primary Dealers will be eligible to submit competitive bids in the auctions. Non-competitive bids can also be submitted as per existing instructions.

Eligible participants will submit the following in the auction bidding on Bloomberg Auction Module (AUPD) within the stipulated time:

• Bid price (per Rs.100 of face value) for the buyback up to four decimal places
• Amount (face value) of the securities

On the date of settlement, the bought back securities will be debited from the SGLA of successful bidders while their current accounts will be credited with the accepted amount.

Apart from the above, all other auction rules and procedures shall apply to the buyback auctions as defined in various circulars related to the auction of Marketable Government Securities.

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