Dawn

Long-term Islamic financing facility launched

The State Bank of Pakistan (SBP) launched the Islamic Long- Term Financing Facility (ILTFF) based on Modaraba for exporters with a maximum limit of Rs1.5 billion. The central bank currently provides the Long Term Financing Facility (LTFF) through conventional banks. The ILTFF will allow exporters an opportunity to avail long-term refinance facility of SBP for purchase of new machinery from eligible Islamic banks. The period of financing under the ILTFF will not exceed more than ten years including a grace period of maximum two years. Islamic banks and Islamic banking branches of conventional banks may also apply to SBP. The allocation is subject to a maximum of 20pc of the limit under LTFF for utilisation under ILTFF. The State Bank’s move would support both the Islamic banking as well as exporters who achieved a positive growth after five years.

Deposits of Islamic banks grow 10pc

The State Bank of #Pakistan (SBP) issued the Islamic Banking Bulletin for April-June. It reveals that deposits of the Islamic banking industry increased by Rs156 billion or 10% quarter-on-quarter to Rs1,720bn. Deposits of the overall banking industry grew 6.5% over the same period. The share of Islamic banks’ deposits in overall banking industry’s deposits increased to 13.7% at the end of June from 13.2% a quarter ago. This growth helped Islamic banks improve their asset base. The share of Islamic banks’ assets in overall banking assets was 11.6pc at the end of June. Investments also improved thanks to sukuk worth Rs71bn that the government issued in June. Net investments of the Islamic banking industry increased Rs48bn or 9.9% in April-June to Rs537bn. SME financing increased to 3.2% and the share of agricultural financing stood at 0.4% at the end of June.

Syndicate content