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Sep 10 - 16, 2001

30 steps to qualify WB loan completed

Pakistan on Wednesday told the World Bank that it had completed 30 out of 35 total steps to qualify $350 million power sector restructuring programme.

A senior government official told the World Bank energy sector mission that held review meetings with senior officials of the ministry of power was fully satisfied with the progress on restructuring programme. The official, however, declined to comment whether the bank would now release $350 million loan.

He indicated that $75 million tranche of the Asian Development Bank (ADB) loan may not be forthcoming as scheduled in December this year unless the Privatisation Commission completed its task in preparing the transactions.

WAPDA sources told that the utility and the Private Electric Power Company (PEPCO) had completed all the milestones earlier agreed with the World Bank. The only milestone of preparation of financial modelling of distribution, generation and transmission companies was outstanding against WAPDA which almost complete now.

The financial modelling of distribution companies have been approved by all the relevant parties, those of generation companies have also been cleared by the World Bank while the financial modelling of 12th corporate company National Transmission and Dispatch Company (NTDC) would be handed over to the World Bank mission on September 9.

Sources in the ministry of power said after the review meetings with the Asian Development Bank and the World Bank that the progress was slow in five measures but by and large the donor missions were satisfied because most of the steps were on time or in some cases six months ahead of schedule.

These sources, however, agreed if the Privatisation Commission failed to complete preparation of transaction for sale of the KESC, a distribution and generation company by December, the ADB would not release $75 million loan.

SBP leaves T-bill yields unchanged

The State Bank on Wednesday left the treasury bills yield unchanged at the previous levels while auctioning the bills to mop up excess liquidity from inter-bank market.

The move signals that the central bank has little room for further easing off of monetary policy in next quarter.

SBP said it sold Rs11.8 billion worth of T-bills of different maturities to suck in Rs 11.4 billion from the inter-bank market. But in doing so it kept unchanged the cut-off yields on three- month and six-month bills at 10.22 and 10.51 per cent.

It also left intact the yield on one-year bills at the previous level of 10.88 per cent.

In the first two months of this fiscal year the SBP had cut the T-bills yield by 1.71-2.26 per cent in three instalments to keep them aligned with its discount rate that was cut in two phases to 12 per cent.

SBP retail banking

The amended State Bank of Pakistan (SBP) act is likely to be promulgated shortly creating an independent subsidiary to look after SBP's retail banking operations, it is learnt.

Sources in the law ministry said a summary of the proposed amended act was lying with the Chief Executive and hoped that it would be approved this week.

A post of subsidiary managing director has already been created and former chief manager of Lahore office of the SBP has been appointed against it.

The creation of the subsidiary is part of the SBP restructuring plan which included technology upgradation, recruitment of professionals and delegation of powers and authority.

TFCs over subscribed

Packages Limited announced on Thursday that it had received Rs410.735 million in subscription to the 2nd issue of its Term Finance Certificates (TFCs). The figure worked out to 2.7 times the company's offer of Rs150 million.

More parties invited for PTCL stake

The Privatization Commission said on Tuesday more parties could apply to buy a "strategic" 26 per cent stake in Pakistan Telecommunication Company Ltd (PTCL).

A Commission statement added the 11 parties from around the world that had already lodged expressions of interest (EoIs) in the PTCL sell-off must submit a qualification document Request for Statement of Qualification (RSOQ) by October 1.

IDB award

The Islamic Development Bank (IDB) has invited nominations by October 31 next (15 Sha'aban 1422H) for the award of IDB prize in Islamic banking for the year 1422H (2002G). The prize consists of a citation and cash award of 30,000 Islamic dinars approximately 40,000 dollars.

MCB rating upgraded

JCR-VIS Credit Rating Company Limited has upgraded the entity ratings of Muslim Commercial Bank Limited (MCB) from A+ (A Plus) to AA- (Double A Minus) for medium to long-term and from A 1 (A One) to A1+ (A One Plus) for short-term. The rating company termed the outlook of the MCB stable.

Union Insurance

Union Insurance Company Limited plans to raise Rs10.4 million, through the issue of right shares at 21 per cent, at par. The proposed right issue, when completed, is envisaged to raise the company's paid-up capital from Rs49.6 to Rs 60.0 million. For the year ended December 31, 2000, the company had posted pre-tax profit amounting to Rs145,000 and after tax profit at Rs92,000.

Al-Ghazi Tractors

Al-Ghazi Tractors Limited unveiled financial figures for the first half of the current year to end-June 2001.

These showed 6 per cent improvement in pre-tax profit, which amounted to Rs613.8 million for the Jan-June six months of 2001, against Rs578.9 million in the corresponding period of the previous year. After tax profit was up 2 per cent to Rs381.8 million from Rs375.4 million.