The State Bank of Pakistan raised Rs376.74 billion in face value through its latest auction of Pakistan Investment Bonds with fixed coupons, exceeding the revised auction target of Rs350 billion. The auction, held on October 7, 2026, attracted total face value bids of Rs849.05 billion across five different maturities. The settlement date for the accepted securities was set for October 8, 2026, with the 3-year Pakistan Investment Bond emerging as the leading tenor in both investor demand and overall acceptance.
The auction covered 2-year zero-coupon, 3-year, 5-year, 10-year and 15-year zero-coupon Pakistan Investment Bonds with fixed coupons. Before the auction, the State Bank of Pakistan had reduced the overall target from Rs450 billion to Rs350 billion. The revised targets included Rs75 billion each for the 2-year and 3-year tenors, down from Rs100 billion each, while the target for the 10-year tenor was reduced from Rs100 billion to Rs50 billion. The targets for the 5-year and 15-year securities remained unchanged at Rs100 billion and Rs50 billion, respectively.
Investor demand was concentrated in the shorter and medium-term securities, with the 3-year tenor receiving the largest volume of bids. Total face value bids for the 3-year Pakistan Investment Bond reached Rs386.403 billion, followed by Rs309.775 billion for the 5-year tenor. The 10-year security received Rs84.525 billion in bids, while the 2-year tenor attracted Rs63.351 billion. The 15-year zero-coupon bond received Rs5 billion in bids. Across all five maturities, total bids reached Rs849.054 billion, considerably above the revised amount the central bank sought to raise.
Competitive bids worth Rs342.276 billion were accepted across the available tenors. The 3-year security accounted for the largest portion, with Rs195 billion accepted at a cut-off yield of 12.7460%. The 5-year tenor followed with Rs122 billion accepted at a cut-off yield of 12.8998%. The State Bank also accepted Rs25.025 billion through the 10-year tenor at a cut-off yield of 12.8500%, while only Rs0.251 billion was accepted against the 2-year security at a cut-off yield of 12.7950%. All bids for the 15-year tenor were rejected.
The auction also recorded changes in cut-off yields across the different maturities compared with the previous auction levels. Cut-off yields increased by between 26 basis points and 41 basis points for the 3-year, 5-year and 10-year securities, while the yield on the 2-year tenor declined by 19 basis points. The movement in yields came alongside strong overall bidding, particularly for the 3-year and 5-year instruments, which together accounted for the overwhelming majority of total bids received during the auction.
When non-competitive bids were included, the overall acceptance increased to Rs376.74 billion. The 3-year tenor recorded the highest total acceptance at Rs220.460 billion, comprising Rs195 billion in competitive bids and Rs25.4603 billion in non-competitive bids. The 5-year tenor followed with total acceptance of Rs130.5564 billion, including Rs122 billion in competitive bids and Rs8.5564 billion in non-competitive bids. The 10-year tenor remained at Rs25.025 billion because no non-competitive bids were received, while total acceptance for the 2-year tenor reached Rs0.699 billion.
The detailed acceptance figures show that Rs34.4648 billion was accepted through the non-competitive category across the auction. The 2-year security received Rs0.4481 billion in non-competitive acceptance, while the 3-year instrument received Rs25.4603 billion and the 5-year instrument received Rs8.5564 billion. No non-competitive bids were received for the 10-year tenor, and the 15-year instrument recorded no acceptance after all bids were rejected. The combined competitive and non-competitive acceptance brought the total amount raised to Rs376.7407 billion.
The auction results show that demand remained heavily concentrated around the 3-year and 5-year Pakistan Investment Bonds. The two tenors received a combined Rs696.178 billion in face value bids out of the total Rs849.054 billion received across all maturities. Their combined acceptance also accounted for approximately Rs351.017 billion of the total Rs376.741 billion raised. The 15-year security, despite receiving Rs5 billion in bids, did not result in any accepted amount, leaving the longer zero-coupon tenor outside the final allocation.
The latest auction therefore enabled the State Bank of Pakistan to raise more than the revised Rs350 billion target while investors showed the strongest participation in the 3-year and 5-year fixed-rate securities. The final acceptance of Rs376.74 billion, compared with total bids of Rs849.05 billion, reflects the allocation decisions across the five maturities and the government’s revised borrowing requirements for the auction.
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