Islamabad, Feb 13: The State Bank of Pakistan (SBP) has revised its buyback mechanism for government securities, introducing a broader approach to managing national debt. Under this updated framework, the SBP will conduct auctions for the repurchase of Market Treasury Bills (T-bills) and Pakistan Investment Bonds (PIBs), covering Zero Coupon, Fixed, and Floating Rate instruments on behalf of the Government of Pakistan.
Previously, buyback auctions were limited to short-term securities. However, to strengthen debt sustainability and enhance fiscal management, the government has now expanded these operations to include long-term bonds. This strategic decision is aimed at reducing the overall national debt burden and improving liquidity management.
The first buyback auction under this new policy took place on September 30, 2024. During this event, a total of Rs. 563 billion in bids were submitted, out of which Rs. 351 billion were accepted for T-bills set to mature in December 2024. This initiative was supported by liquidity sourced from the SBP’s profit transfer, demonstrating the government’s commitment to proactive debt restructuring.
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To ensure transparency and accessibility, the SBP will provide auction details—including the types of securities, target amounts, auction schedules, and results—through multiple platforms. These include SBP’s official website, as well as financial information services such as Refinitiv and Bloomberg.
According to the official circular, all primary dealers are eligible to submit competitive bids in the auctions. Additionally, non-competitive bids can also be placed in line with existing regulations. This revised approach is expected to create a more efficient debt management system while maintaining financial market stability.
