SBP injects Rs546 billion in banking system

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KARACHI: The State Bank of Pakistan (SBP) on Friday injected Rs546 billion worth of liquidity in the banking system through open market operation in a view to fulfill the short-term liquidity requirements of the banks, according to the SBP data on Friday. The State Bank conducted its reserve repo open market operation in the market treasury bills and Pakistan Investment Bonds. The central bank injected Rs546 billion in the banking system for seven days at the rate of 9.01 percent per annum as against the offered amount of Rs547 billion.

Money market experts said that the banks exposure in government papers and treasury securities continued to rise by fulfilling the financing needs of the government for budgetary support.

The aggressive lending by the banks to the government has been flashing out liquidity from the banks, said experts.

The stressed liquidity conditions and low deposit growth compelled the banks to enhance borrowings from financial institutions, especially interbank money market, they said.

Courtesy: The News

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