The State Bank of Pakistan (SBP) posted a historic profit of Rs3.4 trillion for FY24, marking a significant boost to the cash-strapped federal government.
According to audited accounts, the central bank’s earnings saw a remarkable rise from Rs1.1 trillion in FY23.
Mohammed Sohail, CEO of Topline Securities, highlighted that the SBP’s profits are now the government’s largest revenue source, surpassing earnings from trade or industry. “The unprecedented 22 per cent interest rate may be challenging for the economy, but the central bank’s profitability will help ease fiscal pressures,” said Sohail.
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The government, facing a debt servicing bill of Rs9 trillion in FY25, will receive Rs2.72 trillion, or 80 per cent of the SBP’s profit. Sohail added that higher interest rates and a stable rupee drove the profits, improving overall government liquidity.
In light of improved financial conditions, the government rejected all treasury bill bids this week and raised less than half the target through Pakistan Investment Bonds, underscoring its enhanced fiscal flexibility.
