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FINANCE

$67 million FCDs placed with State Bank in June

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The State Bank attracted $67 million worth of fresh foreign currency deposits (FCDs) from banks in June after it asked them on June 5 to place surplus foreign currency funds with it.

The SBP revealed it to all commercial and investment banks on Thursday through a letter dated June 30 which said the foreign exchange reserves totalled around $1.73 billion on the same date. The letter did not say specifically whether the foreign currency deposits placed by the banks with SBP formed part of the reserves but bankers said the FCDs placed with SBP were included in the reserves.

Forex reserves up $ 49m

The foreign exchange reserves have increased by 49 million US dollars in one week, said a circular issued by the State Bank on Thursday. The foreign exchange reserves of the State Bank as on June 30, 1999 amounted to 1.729 billion dollars compared with 1.680 billion dollars last week.

$300m IMF tranche to be offered this month

The International Monetary Fund (IMF) will offer the next tranche of $300 million to Pakistan by July this year.

Sources in the multilateral agencies told that an IMF review mission was arriving here in early July to finalize the arrangements for offering the next tranche, out of $1.6 billion Extended Structural Adjustment facility (ESAF) and Extended Fund Facility (EFF).

"The fund authorities are expected to disburse 200 million Special Drawing Rights (SDRs) by next month which are roughly equivalent to $300 million", disclosed a source in the local multilateral agency.

When contacted, he said, IMF has no plan whatsoever to withhold the next tranche as was reported in the section of the international press, especially in the Washington Post. "And we do not know from where this figure of $100 million came which according to the Post was being withheld", he said. The IMF he added, has informed the Pakistani authorities that future funding from the ESAF/EFF programme was very much on "schedule" and that it was not being suspended.

Sources said "much of the ground has been covered" to offer the next tranche during discussions between the government and the IMF review mission in early June. Therefore, they said, Pakistan now largely qualifies for receiving the next tranche of $300 million.

Foreign investment in commercial bank shares allowed

The Securities and Exchange Commission of Pakistan (SECP) has allowed foreign nationals and foreign financial institutions to invest in the shares of domestic commercial banks for trading purposes only.

According to a circular of SECP, under the agreement signed between the Government of Pakistan and the World Trade Organisation (WTO) on financial services, the following securities market-related conditions are to be complied with:

Prior permission in writing of the Central Bank (State Bank of Pakistan) will be required by any person for holding beneficial ownership of five percent or more of the paid up capital of any bank/financial institutions incorporated in Pakistan.

Foreign nationals and foreign financial institutions will be allowed to invest in the shares of domestic commercial banks for trading purposes only.

MCB gives 17.5pc dividend

Muslim Commercial Bank (MCB) increased its after tax profit by 67 per cent to Rs399 million during 1998 from Rs239 million in 1997, its chairman Mian Mohammad Mansha told its annual general meeting (AGM). The AGM also announced 17.5 per cent dividend for shareholders for the year under review as compared to 15 per cent in 1997.

Dollar rates up by one rupee in kerb

Licensed money changers have increased US dollar selling rate by 100 paisas to Rs 54.50 bringing it at par with the black market rate and lifted all restrictions on dollar transactions.

In a dramatic move the Forex Association of Pakistan (FAP) fixed the dollar rate at Rs 54.20/ 54.50 for buying and selling and said it was a step on part of their own to tackle the black marketing of green bill in the open market.

Denmark, Pakistan sign agreement for debt rescheduling

Denmark on Tuesday signed a bilateral agreement with Pakistan on debt rescheduling, allowing Islamabad to make due re-payment of $ 3.5 million over a period of 20 years.

The agreement was signed following negotiations between the two countries in Islamabad on consolidation and rescheduling of debt, in pursuance of Paris Club Agreement of Jan 30, '99.

According to the official sources, debt service payments due during the period from July 1, '98 to Dec 2000, amounting to DKR 24,4000,000 ($ 3,383,015) have been consolidated for repayment over a period of 20 years, including a grace period of 10 years, free of interest.

The first instalment of rescheduled debt will be paid on July 1, 2010 and the final payment will be made on Jan 1, 2020, the sources said.

NIT attracts net inflow of Rs555m

The National Investment Trust (NIT) had a net inflow of over Rs555m into the fund during the current fiscal year, official sources said Saturday.

'The initiatives taken by the NIT's management has helped improve the investors' confidence and the redemption pressure on NIT has eased,' sources said.

NIC nets Rsl.515bn profit

The chairman of National Insurance Corporation Jahanzeb Khan has said that the NIC made a record profit of Rsl.515 billion during 1998.

Giving other financial details of the NIC, which was the sole insurer of the public assets, at a press conference on Saturday he said that the corporation had also declared surplus of Rs300 million which had been deposited in the government account.