Pakistan raised US$ 2.5 billion by selling Eurobonds with five, ten, and 30 years tenor. The State Bank of Pakistan announced that it has received proceeds of Eurobonds. Meanwhile, the governor of State Bank announced that the central bank has been considering an option to launch its own digital currency.

Reza Baqir, the governor of State Bank, confirmed that the Pakistani central bank is studying an option to launch its own digital currency. Reza Baqir told CNN that SBP’s digital currency would help the central bank fighting against money laundering and terror financing. “We are at the stage where we are studying it,” Reza Baqir told CNN. “We hope to make some announcement in coming months.” He said the central bank has allowed a framework for digital banks.

Meanwhile, the central bank announced that it has proceeds of the government’s $2.5billion Euro Bonds. “#SBP has received the proceeds of government’s US$2.5bn Euro Bond issuance in its account. As a result, SBP’s FX reserves closed above US$16bn today, their highest level since July 2017,” the central bank said in a press statement. Pakistan’s total foreign currency reserves were $20 billion as of April 2, 2021.

Eurobond for five years was offered at 6 percent, 10 years at 7.375 percent, and 30 years at 8.875 percent. The government accepted bids of US$ 1 billion for five years, another $1 billion for 10 years, and $500 million for 30 years. The settlement date for the issue was April 8. The government had approved in October 2020 to launch three international bonds including Eurobonds, Sukook, and Chinese Panda bonds.

Ministry of Finance issued a press release stating that Pakistan has entered in the international capital market after a gap of over three years by successfully raising US$ 2.5 billion through multi-trance transactions fo 5,10 and 30 years Eurobonds.
“The transaction generated great interest as leading global investors from Middle East, Europe, and the US participated in the global investor calls and the order book.”
This is the first time that Pakistan has adopted a program-based approach with the registration of the Global Medium-Term Note (GMTN) program. The program will allow Pakistan to tap the market at short notice. The government intends to make full use of this program and become a regular issuer in the international capital markets.

The writer is a member of staff
The reporting desk can be reached at info@thecorrespondent.com.pk

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