The State Bank of Pakistan (SBP) has successfully concluded a buyback auction of Pakistan Investment Bonds – Floating Rate (PFL), marking another milestone in its ongoing efforts to actively manage government debt and support liquidity in the bond market. The auction, held on November 12, 2025, resulted in the acceptance of bids amounting to Rs122.1 billion across multiple maturities. Settlement took place on November 13, reflecting the central bank’s proactive stance toward optimizing Pakistan’s debt structure.
According to official data, the SBP invited bids for both 5-year and 10-year floating rate bonds as part of its debt management operation. The auction attracted total bids worth Rs137.1 billion, indicating strong participation from financial institutions and investors in the domestic debt market. Out of the total, the SBP accepted Rs122.1 billion, demonstrating selective acceptance based on pricing and yield considerations.
In the 5-year category, bonds with maturity dates ranging from September 2028 to April 2029 were repurchased, with accepted bids covering three different tranches. The central bank also bought back 10-year floating rate bonds maturing in April 2029. The operation involved repurchases at cut-off prices between 98.45 and 100.47, depending on the tenor and market yield.
The realized amount from the buyback reached Rs120.78 billion, while accrued interest contributed an additional Rs1.14 billion, bringing the total settlement amount to Rs121.92 billion. The SBP’s approach in this transaction reflects its commitment to ensuring efficient market operations while maintaining balance between liquidity supply and public debt sustainability.
Market analysts interpret this buyback as part of the SBP’s broader strategy to manage the maturity profile of public debt, smoothen repayment schedules, and stabilize yields in the secondary bond market. By repurchasing existing bonds, the central bank effectively supports financial institutions’ liquidity positions and encourages active trading in government securities. This helps maintain confidence among investors and ensures a steady flow of funds within the domestic capital market.
The buyback of Pakistan Investment Bonds also aligns with the government’s fiscal objectives of reducing near-term redemption pressures while improving debt portfolio resilience. Such operations are crucial in managing refinancing risks and aligning debt composition with evolving market conditions.
The central bank’s ongoing interventions through open market operations and buyback auctions underscore its commitment to fostering a well-functioning financial system. These measures are instrumental in providing liquidity support, ensuring market depth, and maintaining a smooth transmission of monetary policy.
The SBP’s proactive debt management initiatives are seen as key steps toward enhancing transparency, investor engagement, and confidence in Pakistan’s fixed income market. This buyback auction, with its significant volume and efficient execution, reinforces the central bank’s role in stabilizing financial markets and promoting sustainable economic management.
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