Karachi: Banking sector credit to private sector have shown improvement, as different commercial banks issued loans of Rs 252.456 billion to businessmen and industrialists as of February 12, State Bank of Pakistan (SBP) reported.
The improvement of credit issued to private sector showed an year-on-year growth of 46.8 percent after a long period since the start of the current financial year 2011-12. The volume of loans were recorded at Rs 171.919 billion in the same period of
The government borrowing from banking system has seen to be uncontrolled, as it increased to Rs 855 billion so far for the budgetary support as against Rs 369.16 billion.
The government has borrowed Rs 193.240 billion from the central bank for budgetary support from July to February 12 compared with Rs 128.22 billion loans transferred to it in the same period of last financial year.
The borrowing from central bank was seen under controlled from the government side that caused the stability of discount rate in the recent monetary policy.
Moreover the government’s borrowing from commercial banks has been unabated particularly through T-Bills since the start of the current fiscal year.
Its borrowing from the commercial banks stood at Rs 662.392 billion from Jul-Feb 12, which is 174 percent higher than the amount of previous year, which were seen accumulation of Rs 240.939 billion loans.
The analysts said that the government would continue borrowing from the banking system to support fiscal operations. The government’s borrowing is likely to cross the limit of Rs 308 billion that it set for the commercial banks in the current fiscal year. It will continue auctions of T-bills and loans from banks are going to be a major factor in destabilising the macro-economic indicators of the country.