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Sep 03 - 09 , 2001

Limited withdrawal from NDFC allowed

The State Bank announced on Thursday that individual depositors of NDFC having deposits up to Rs100,000 will be able to draw the principal amount from September 5.

It said the depositors would get profit on their deposits up to Aug 27, 2001 which implied that they would not get any profit on the deposits after this date.

The NDFC sources said 35,000 out of over 100,000 account holders of NDFC have deposits up to Rs100,000 each.

No official word was available about the total amount lying in the accounts of those who have deposits up to Rs100,000. But the sources said the amount was equal to or a little more than 10 per cent of the total deposits worth Rs27 billion.

By end-December 2000, the NDFC had Rs28 billion deposits but that started declining as investors got wind of the government plans of either closing it down or merging it with some other institution.

The SBP also said payment to individual account holders having deposits between Rs100,001 and Rs500,000 would be made by the NDFC in the third week of October before its amalgamation with the NBP in November. "The deposits of the remaining account holders will then be automatically transferred to the NBP."

"To facilitate the smooth transfer of depositors' money to the NBP, their (NBP's) staff will be present at the NDFC branches to assist in the process," said a SBP press release. The release was issued after SBP Governor Dr Ishrat Husain had a meeting in his office with NDFC Chairman Badaruddin Khan and NBP President Ali Raza.

The SBP said non-performing loans of NDFC will be transferred to Corporate & Industrial Restructuring Corporation for disposal through auctions. It said non-performing loans of NDFC were about 80 per cent of its total loan portfolio. It gave no numbers.

Explaining the rationale behind the decision to amalgamate NDFC with NBP the State Bank said that the first option before the government was to revive or restructure the corporation as a viable and sustainable entity but upon close examination this was not found feasible.

SBP injects Rs7.35bn

The State Bank on Thursday injected Rs 7.35 billion into cash-strapped inter-bank money market through one week reverse repo of treasury bills at 9.15 per cent.

This was the second injection within this week. Earlier on Tuesday, the SBP had injected Rs3.3 billion for one week at 9.24 per cent.

Bankers said the huge injection into the market on Thursday slightly eased off the tight liquidity conditions adding that overnight call rate fell from 11.75-11.90 on Wednesday to 9.00 -11.50 per cent. But said most deals were struck on the higher side.

$777m ADB loan by Dec

The Asian Development Bank is expected to approve financial assistance of $777.2 million during current year for 13 projects and programme loans, depicting surge by $70 million against sanctioned loans of $707 million during the year 2000.

Of the total expected financial assistance of $777.2 million, an amount of $209.6 million has already been sanctioned under six loan programmes while rest of $567.6 million is scheduled to be approved by December 2001 under seven projects and programme financial assistance, well-placed sources told APP on Monday.

Over $523m has been disbursed by the bank against sanctioned amount of $707m to date, sources stated, adding another technical assistance of $3.2 million is expected to be signed between the ADB and Pakistan by December 2001.

Adamjee reports first loss

Adamjee Insurance Company Limited reported on Thursday net loss of Rs212 million, which most veterans believe to be the first red ink in the 40 years history of the company. In the corresponding six months (January-June) of 2000, the company had reported after tax profit of Rs137 million.

UK transport co to invest 70m

A UK-based bus manufacturing and operating company Arabian Sights Limited plans to invest 70 million pounds in Pakistan.

Chairman of the company Dr Chaudhry Ghulam Sarwar, who is British national of Pakistani origin, told a press conference on Thursday that the Arabian Sights will launch five projects in different towns of the country.

"The first project land route travel service between Lahore and Makkah will be launched on September 15," he said.

14 banks launch KIBOR on trial

When it came to running a trial operation of KIBOR and KIBID on Wednesday the number of the participating banks rose from 10 to 14 and even a deal was struck during the trial.

"The trial went very well," said President of Financial Market Association Dr Naim Abdullah when sought his comments over telephone. He said the purpose of the trial was to establish the prices of lending and borrowing in the inter-bank market and not to do any business. But bankers said a deal was struck between two of the fourteen participating banks.

Prudential Commercial Bank

The financial figures released on Tuesday shows that at December 31, 2000, the Prudential Commercial Bank Limited was in a financial mess. For the year 2000, the bank posted staggering loss of Rs837 million. The year ago, the bank had posted pre-tax profit of Rs70 million and after tax profit at Rs56 million.

Rupee makes quick recovery

The rupee on Monday fell to 64.20/64.25 per US dollar in inter-bank market but closed at 63.95/64.00 after making a quick recovery on the back of aggressive dollar selling by a foreign bank.

PICIC Bank deposits up 40pc

The deposits of the PICIC Commercial Bank Limited increased by almost 40 per cent in last four months to over Rs7 billion from a little over Rs5 billion in end February when Pakistan Industrial Credit and Investment Corporation took over the controlling shares and management of the Gulf Commercial Bank.