ISLAMABAD: The State Bank of Pakistan (SBP) raised approximately Rs546 billion through its latest auction of fixed-rate Pakistan Investment Bonds (PIBs), reflecting continued interest from investors across medium- and long-term tenors despite selective acceptance by the central bank.
According to auction results released on Tuesday, total bids worth Rs2.06 trillion were offered, out of which Rs546.32bn were accepted on a face value basis. The accepted amount included Rs450bn from competitive bids, Rs41.9bn from non-competitive bids, and Rs54.4bn from short selling.
Cut-off yields for the auction ranged from 10.19% for the 2-year bond to 11% for the 10-year bond, indicating relatively stable yield expectations across the curve. The 3-year PIB emerged as the most sought-after tenor, with the SBP accepting Rs125bn through competitive bids and Rs17.18bn via non-competitive bids, bringing total acceptance for the tenor to Rs156.60bn.
The 10-year bond also witnessed strong demand, with Rs126bn accepted from competitive bidders and Rs4.93bn from non-competitive bids, resulting in a combined acceptance of Rs142.93bn. The continued appetite for longer-tenor bonds suggests investor confidence in medium- to long-term rate stability.
Meanwhile, the 5-year bond attracted total acceptance of Rs133.07bn, while the 2-year zero-coupon bond recorded acceptance of Rs113.74bn. In contrast, the 15-year zero-coupon bond saw all submitted bids rejected, reflecting the central bank’s cautious approach toward extending duration at current yield levels.
Non-competitive bids accounted for a relatively small portion of total acceptance. The largest non-competitive allocation was made to the 3-year bond at Rs17.18bn, followed by the 5-year bond at Rs11.07bn and the 2-year bond at Rs8.74bn.
The auction results highlight the SBP’s continued reliance on PIBs as a key domestic debt instrument, while maintaining tight control over maturities and yields in line with broader monetary and debt management objectives. The selective rejection of longer-tenor bids also indicates a focus on managing refinancing risks and cost pressures amid evolving macroeconomic conditions.
Overall, the auction underscores steady investor participation in government securities, with demand concentrated in benchmark tenors that balance yield visibility and duration risk, as Pakistan continues to navigate its fiscal and monetary landscape.
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