PRO 21-06-2012_Layout 1 6/23/2012 6:24 AM Page 1
saturday, 23 June, 2012
Dollar slips in Asian trade Page 19
Branchless banking continues to branch out g
Users transact Rs 85b via branchless banking despite the best efforts of those oh so mean banks KARACHI
Time to move on to the next base, sweetie
SBP reminds its sweetheart PBS to rebase national income accounts and issue quarterly GDP estimates. And it also reminded mankind that contrary to popular opinion, energy shortage and lack of investment were in fact pretty perilous for the economy. Elsewhere, there was the reiteration that the economy would grow by 3.7pc in FY12, and so there’s a fair chance that we might eventually get to live happily ever after...
While branchless banking attracts more and more users, especially in the country’s unbanked rural areas, the limited banks’ authorisation to the agents is hindering its expansion. According to central bank’s quarterly report on branchless banking, the branchless banking had seen another quarter of growth on almost all fronts during July-March FY12. Growth in the agent’s network and number of mobile wallets was 19 percent and 14 percent, respectively, whereas the number and value of total transactions increased by 23 percent and 7 percent, respectively. During the review quarter, more than 25 million transactions worth Rs 85 billion or $ 938 million had been processed through branchless banking channels. “The average size of transaction has further reduced to Rs 3,367 showing that technology is reaching the previously un-banked poor,” the SBP observed, adding that the customers had transferred around Rs 99 million through their mobile to other m-wallet accounts, showing the adoption of technology by the common man. Rs 13.8 billion government to person payments and Rs 60 million salary payments had been disbursed during the quarter via mobile banking. “The growth in number of transactions is mainly due to the increasing volume of bill payments, person to person fund transfers, and airtime top-ups, which accounts for 42 percent, 32 percent and 10 percent respectively,” the SBP said. Similarly, it said, the growth in value of transactions was again owed largely to P2P payments. All other categories had either experienced slightly negative growth or had contributed a small share in total value. While considering share in total value, all bulk payments constituted almost 50 percent of the total value of transactions followed by P2P payments (36 percent) and bill payment (12 percent). Growth has been observed in loan repayment transactions as Rs 312 million were collected through BB agents. Both models, Easypaisa and Omni, were trying to increase their linkages with microfinance providers to allow microfinance borrowers to use BB channels for repayment of loans. Moreover, volume of salary disbursement has also increased mainly due to Easypaisa’s arrangement with government organisations for salary disbursement. Around Rs.13.8 billion have been transferred on account of G2P payments through the existing agents’ based banking. However, the current 14 percent growth rate of m-wallets showed some slowdown compared to the last quarter when the growth rate was around 40 percent. Similar trend is observed in deposits value. “The less-than-expected growth rate in m-wallets is owed to the fact that only 23 percent of the total active agents (around 24,101) are authorised by banks to open the m-wallet accounts,” the central bank said. The number of registered m-wallets has reached to 1.03 million at the end of the quarter under review in which the number of active m-wallets is about 53 percent. In addition, 5,573 debit cards have also been provided to mobile account holders, indicating efforts to create value proposition in m-wallets. The fast growing network of branchless banking has reached at 26,792 agents. This agents’ network now has foot prints in 89 percent of total districts in the country. The BB market is ready for expansion as while the Waseela Microfinance Bank, a subsidiary of M/s Orascom, has commenced its business operations as a nationwide microfinance bank, other banks are coming in.
ing financing pressures. PSEs BURDENING BUDGET: The SBP expressed concern over operational efficiency of key Public Sector Enterprises (PSEs) that, it warned, were adding to the cash-strapped country’s fiscal burden. FISCAL DEFICIT FINANCING: While external financing dried up the government the government relied more on domestic sources to finance the fiscal gap and borrowed Rs 847.5 billion in Jul-Mar FY12 against Rs 700 billion of last year. “Such borrowing is inflationary and a risk to macrostability,” the regulator warned. Currently, two acts, namely the Fiscal Responsibility and Debt Limitation (FRDL) Act (2005) and the newly amended SBP Act, provide guidelines on overall debt stocks and borrowing from the central bank, respectively, the SBP said. The government’s greater reliance on short-term borrowing, the SBP said, was creating liquidity management problems for the central bank, and rollover and interest rate risks for the government. “LESS ADVERSE”: The SBP said developments in Q3-FY12 in external sector were less adverse than expected and that larger inflows of remittances and a lower trade deficit explained this relative improvement. The current account deficit during JulMar FY12 was $ 3.1 billion, compared to a deficit of $ 10.0 million in the corresponding period last year, it said. FOREIGN INFLOWS: More importantly, the expected inflows under Coalition Support Fund (CSF), the auction of 3G licenses, and arrears from PTCL privatisation, did not materialise during the quarter.
ORESEEInG the troubled economy growing by a “notable” 3.7 percent in the outgoing FY12, the central bank stressed the pressing need for rebasing the country’s national income accounts in synchrony with the changing nature and composition of current economic activities. Further, while foreign financing had almost dried up during the July-MarchFY12, the cash-strapped government borrowed a massive Rs 847.5 billion from domestic sources – primarily the banks – to bridge the 4.3 percent budget deficit the country faced during the quarter in review. The borrowed amount is higher by Rs 147 billion or 21 percent than the Rs 700.1 billion the government had raised during the corresponding period of FY11. The huge fiscal deficit, the bank said, inflated the government’s domestic debts by a whooping Rs 1.2 trillion to Rs 7.2 trillion during the review period. The State Bank said the available data suggested that the budgetary gap for the full year, July-JuneFY12, would exceed the revised target of 4.7 percent and that the overall revenues had been lower than expected. SBP, in its Third Quarterly Report for FY12, dubbed the continuous slump in foreign and domestic investment, acute energy shortages and the persistently high fiscal deficit as major risks to the macro-economy. These negatives, the bank said, were a source of growing concern for the economic mangers and had all the potential to directly
stifle long-term growth prospect. REBASING INCOME ACCOUNTS: The central bank said it was important that GDP data should reflect the changing nature and composition of the country’s economic activities. Adding that Pakistan Bureau of Statistics (PBS) was already in the process of rebasing national income accounts. “We expect that PBS would also consider releasing GDP estimates on a quarterly basis, which is now a norm in emerging markets. It will help get a more accurate and timely picture of the real economy, which will allow for more proactive policy corrections,” the SBP said. ECONOMIC GROWTH: About the economic growth, the bank said the expected 3.7 percent growth during FY12 was higher than the 3.0 percent realised in the previous year, but less than the target of 4.2 percent. nevertheless, it said, this performance was notable given the considerable damage to
the cotton crop due to floods in August 2011; ongoing energy shortages; the rise in international oil prices; and security concerns. WEAK MACRO INDICATORS: “Although Pakistan’s economy has shown some recovery in terms of GDP growth, the key macro indicators still remain weak,” the SBP said. The central bank said this 3.7 percent growth rate had also been more broadbased with a larger contribution from the commodity producing sectors compared to FY11. Moreover, as in the past, growth had been driven by domestic consumption, both private and public, which was partially offset by a decline in domestic investment and external demand. The State Bank said though the growth in current expenditure was lower compared to the previous year, the government had enhanced its development spending which should improve the country’s long-term growth prospects, besides creat-
Uncle Sam’s men Sindh threw caution to the wind; want to take over our farms Punjab bathes in sunshine ‘US agrichemical PUNJAB WOOS SOLAR POWER INVESTORS
company wants control over agriculture’
The lukewarm response of the Sindh government to the wind power investors has shifted a majority of interested investors in the solar power to Punjab, where the provincial government is more cooperative in providing land and other amenities, an official source said. Punjab government, he said was very cooperative with regards to promote photovoltaic (PV) power projects in the province. Investors are approaching Punjab as the Sindh government is totally reluctant to grant land for wind and solar power projects. He mentioned lack of infrastructure as another major reason for the stalling of wind power projects in Sindh. While in the solar power the major hurdle had been the initial cost; but considering the disparity in demand and supply the investors were ready to invest as they could gain maximum return on their investment. Punjab government is interested in promoting solar power in less developed areas but once some successful models are available it could be used for pumping the water through tubewells. Only recently the government has approved a solar tubewell project. According to the Alternate Energy Development Board, solar energy has excellent potential in Pakistan that receives high levels of solar radiation throughout the year. Every day, the country receives an average of about 19 Mega Joules per square metre of solar energy. It is available at a rate of 1000 watts per square meter in the country. This can be converted to DC electricity with the help of solar PV cells, which may be used to pump water, operate fans, TV and telecommunications directly during daytime. The electrical energy gener-
ated during the day time, can also be stored in deep cycle lead acid batteries which can be used at night to provide power for lighting, radio, Television and fans. The system will be user-friendly and designed as a stand-alone system for each household, who will be trained to operate and maintain it. The user will only be required to switch on/off the system, as is done in normal home lighting systems. In addition, solar photovoltaic panels can generate enough electricity to pump water from depth of 350 to 1000 feet. Many of these villages are far from the main transmission lines of the national grid and, because of their relatively small populations; it is usually not economically viable to connect these villages to the grid. Solar energy, on the other hand, has excellent potential in areas of Pakistan that receive high levels of solar radiation throughout the year.
Chairman Agriforum Pakistan Ibrahim Mughal has clamed that the US agrichemical Company Monsanto has planning to get its control over Pakistan’s agriculture for setting up its monopoly. While talking to Online on Friday Ibrahim Mughal said that for the free economy it was necessary that Monsanto should not be allowed in Pakistan. He said that Monsanto was also working in neighboring India but it has brought no improvement in their agriculture sector then how it can increase our country’s cotton production. He explain that production increase in India has not been usage of BT cotton but other factors like increase in irrigated areas and reforms in agriculture sector have contributed to enhance production. He added that use of BT cotton varieties will not cause increase in production. Sources said that some high level bureaucrats in Punjab Province were meanvouring for giving US agrichemical Company exclusive right of marketing BT cotton but Punjab government has so far rejected this the plan of US Company which were demand to pay penalty if any other variety is cultivated.
PRO 21-06-2012_Layout 1 6/23/2012 6:24 AM Page 2
Saturday, 23 June, 2012
A PM-AND-BULL STORY
Raja Pervez Ashraf stimulates the bulls Bulls gave the new PM their own guard of honour, as they went off their rockers en route to lifting the index by 130 points. Fall in global stocks and commodities clamoured for the bears, but they were firmly trapped inside the red rag g
KARACHI staff rEpOrt
FTER being in the closet for the past couple of days, bulls arrived with venom at the local stock market on the last working day of the week. KSE 100 index closed with a total gain of 0.96 percent. Karachi stock market benchmark KSE-100 share index increased 130.22 points or 0.96 percent to finish the day at 13,730.82 points as compared to the 13,600.60 points of Thursday. The bulls paraded amid higher trades on speculations ahead of announcement for new Prime Minister, Ahsan Mehanti Director at Arif Habib Investments Limited, observed. KSE-All share index gained 92.14 points or 0.96 percent to close the day at 9,670.12
Oil up in Asia on short-covering
points, KSE-30 share index added 120.03 points or 1.02 percent to end the trading session at 11,866.54 points, while KMI-30 share index was lifted up by 236.27 points or 1.00 percent to terminate the day at 23,765.10.03 levels. The intraday high and low, respectively, stood at 13, 759.50 and 13,536.48 points. The market capitalisation grew modestly and increased to Rs 3.504 trillion from Rs 3.470 trillion a day earlier. Mehanti said the expectations on improvement in Pak-US ties after positive statements by US Secretary of State played the catalyst’s role in bullish sentiments at KSE despite concerns for fall in global stocks and commodities, security situation in the city and prevailing political uncertainty. Stock market traded 84.863 million shares after opening at 57.159 million
shares. Activity took place in 353 stocks where gainers outnumbered the losers 167 to 77 while the values of 109 companies not changed. Active list was gained topped by DGK Cement with 7.363 million shares to close at Rs 40.16. IGI Investment Bank was on the second position with 7.058 million shares to stop at Rs 2.25. It was followed by Bank Al-Falah with 6.631 million shares, Lucky Cement with 5.020 million shares to stop at Rs 114.32 and Jahangir Siddiqui Company with 4.432 million shares to end at Rs 13.17. The Siemens Pakistan and Indus Dyeing XD, which were the biggest price gainers of the day, increased by Rs 14.87 and Rs 9.18 while the top losers were led by the nestle Pakistan Limited and UniLever Pak Ltd down Rs 23.73 and Rs 17.43 respectively.
Dollar slips in Asian trade
Oil prices inched up in Asian trade Friday as wary traders bought up cheap crude to recoup some of their losses after markets plunged in overnight trade, analysts said. new York's main contract, light sweet crude for delivery in August, gained 34 cents to $78.54 a barrel, up from $78.20 in new York, its lowest level since the beginning of October last year. Brent north Sea crude for August delivery advanced 36 cents to $89.59 after tumbling to $89.23 in late Thursday trade, dipping below the $90 line for the first time since December 2010. Traders were buying crude in an attempt to cover some of the losses they had sustained overnight, said Jason Hughes, head of premium client management at IG Markets Singapore. "We're seeing a small bounce for now. There is potential for a little bit of short-covering given the big moves last night," he told AFP. But Hughes said the market outlook remained grim following disappointing numbers from China and Europe. Preliminary data from banking giant HSBC on Thursday showed China's manufacturing activity hit a seven-month low in June. And eurozone private sector activity sank to the lowest level for three years in the second quarter, a survey showed.
LAHORE: Etihad Airways, the national airline of the United Arab Emirates, achieved a new milestone of more than 65,500 flight bookings made in a single day. In addition, passenger bookings for June 14 to June 17 remained the highest of any four days previously experienced by the airline. The most popular overall destinations for travel over the June 14 – 17 period were Bangkok, Manila, London, Riyadh and Jeddah. Top premium travel destinations also included Paris, Sydney and Frankfurt. James Hogan, Etihad Airways’ President and Chief Executive Officer, said: “Etihad Airways is experiencing exceptional demand for flights across our network for this month. We are delighted to have broken our own records for flights bookings and will look to raise the bar further over the coming months.” Etihad Airways will operate 1,262 flights each week in the summer of 2012, compared to 1,106 flights in the summer of 2011, an increase of 14 Per cent. The airline currently operates 23 weekly flights for Pak-
Major Gainers COMPANY
Siemens Pakistan Indus DyeingXD Attock PetroleumXD Linde Pakistan Ltd Gatron Ind.
718.69 394.98 450.00 115.04 89.00
739.00 405.00 461.00 120.79 93.45
700.01 403.90 450.00 117.00 92.99
733.56 404.16 458.00 120.29 93.45
14.87 9.18 8.00 5.25 4.45
92 250 191,451 11,514 407
Major Losers Nestle Pakistan Ltd. UniLever Pak EFU General Ins. Philip Morris Pak. Biafo Industries
4085.41 7367.43 78.06 172.79 58.95
4096.00 7365.00 81.74 175.99 56.10
4002.00 7350.00 74.16 169.00 56.02
4061.68 7350.00 74.18 169.03 56.10
-23.73 -17.43 -3.88 -3.76 -2.85
12 35 65,512 3,596 560
Volume Leaders Nestle Pak Ltd. 4085.41 UniLever Pak 7367.43 EFU General Ins. 78.06 Philip Morris Pak.172.79 Biafo Industries 58.95
4096.00 7365.00 81.74 175.99 56.10
4002.00 7350.00 74.16 169.00 56.02
4061.68 7350.00 74.18 169.03 56.10
-23.73 -17.43 -3.88 -3.76 -2.85
12 35 65,512 3,596 560
Interbank Rates US Dollar UK Pound Japanese Yen Euro
94.3571 147.4140 1.1745 118.4558
Dollar East US Dollar Euro Great Britain Pound Japanese Yen Canadian Dollar Hong Kong Dollar UAE Dirham Saudi Riyal Australian Dollar
95.30 118.95 147.65 1.1748 92.10 12.14 25.89 25.38 94.92
96.00 119.70 148.54 1.1818 93.16 12.26 26.02 25.48 96.95
Return of the old phantoms g
PTA failed to recover Rs 79.763 million of USF in 2010-11 ISLAMABAD ONLINE
The dollar slipped in Asian trade Friday following falls on Wall Street triggered by worries over global growth and amid disappointment over a muted stimulus move by the US Federal Reserve. Against the dollar, the euro firmed to $1.2563 in Tokyo morning trade from $1.2543 in new York late Thursday, while the single currency dipped to 100.62 yen from 100.68 yen. The dollar -- which enjoyed a rally in US trade Thursday as markets looked to safe-haven currencies -- slid to 80.09 yen from 80.26 yen in US trade. "The momentum of the dollar's rise will weaken following falls in share prices and a lull in the trend of rising US government bond yields,"
Masafumi Yamamoto, chief currency strategist at Barclays Capital, said in a client note. The Fed earlier this week disappointed some expectations that its policy board would launch a new quantitative easing programme that would inject more money into the economy to boost growth. Markets were also looking to a European Union finance ministers' meeting later Friday, he added. The leaders of Germany, France, Italy and Spain are also due to meet in Rome later in the day to thrash out details of measures aimed at tackling Europe's ongoing debt crisis before a crucial EU summit next week. The International Monetary Fund on Thursday said the eurozone needs to establish a full banking union and that the European Central Bank should usher in further stimulus, saying the eurozone crisis was at a "critical stage."
The Auditor General of Pakistan (AGP) in its audit report high lighted irregularities, non recoveries of Rs 79.763 million on account of Universal Source Funds (USF) by Pakistan Telecommunication Authority (PTA) during FY 2010-11. These irregularities were unearthed in the special audit report on the account of PTA for the audit year 2011-12. According to the this report PTA did not recover an amount of 79.763 million on account of USF charges from the operators during FY 2010-11 despite pointing out by the audit in the previous audit reports. Audit report said that non recovery of receipts replicates ineffective financial managements of PTA and weak internal controls devised for realization of receivables. This report further revealed that Rs 9. 2 million have not been recovered from 4B Gentle International Ltd, Rs 3,163 million have not been recovered from Dvcom and Rs 67, 763 million have not recovered by PTA from World call telecom Ltd.
Asian stocks fall
Etihad Airways witnesses record flight bookings
istani travellers between Pakistan and Abu Dhabi – daily from Karachi, Lahore and Islamabad and bi-weekly from Peshawar.
NBP organises training on quality lending in agriculture KARACHI: national Bank of Pakistan organized training for over 25 General Managers (Credit) of the Bank from all over the country in a local hotel in Karachi. The objective of this program was to further develop their analytical and professional skills for effectively processing of credit proposals, augmenting credit monitoring skills and through analytical approach recognize early signals for non-performing loans. They also attended lectures for enhancing their management and leadership skills. The focus of the training was also to expand credit to farmers and other small & medium enterprises to generate more employment in these industries by helping them to be financially viable. The lectures were delivered by professionals having required expertise which was greatly appreciated by all participants.
KARACHI: PERA 2011 winners with Chief Guest - Dr Ishrat Husain, Arif Mirza (head ACCA PK) and Ali Habib.
Asian shares fell on Friday and the safe-haven dollar hovered near its highest in a week-and-a-half after weak manufacturing data from the United States, Europe and China heightened fears over the outlook for global growth. A long-expected downgrade to the credit ratings of 15 of the world's biggest banks by ratings agency Moody's added to the gloom, which also weighed on commodities and currencies such as the Australian dollar that are linked to resource demand. MSCI's broadest index of Asia Pacific shares outside Japan fell 1.4 percent and Tokyo's nikkei share average lost 0.5 percent."It was expected that the market would undergo an adjustment after earlier climbs, and the soft data gave it a reason," said Lee Seung-woo, an analyst at KDB Daewoo Securities in Seoul.
SECP to introduce e-IPO ISLAMABAD ONLINE
KARACHI: The Consul General of Japan Mr. Masaharu Sato, was the chief guest at Mango Festival, by PC, Hotel, G.M, of Hotel Mr.Azeem Qureshi, also seen in picture.
The SECP is about to introduce the concept of e-IPo in the upcoming Initial Public Offering (IPOs) of shares and Corporate Bonds (CBs) by companies. The concept will enable the investors to make application for subscription of shares and CBs through internet from their computers and mobile phones without going to their Banks and wait in long ques. Purpose of implementation of the e-IPO is to facilitate simultaneously both the companies that intend to raise fund from the capital market through IPOs and the general public applying for subscription of shares and CBs offered by the companies to the public.