Professional Documents
Culture Documents
Internship Report
INTERNSHIP REPORT
University of the Punjab
Abubakar Riaz
B.Com Honors
Presented By:
Presented to:
Dr. Liaqat Ali
Respected Sir,
Hailey College of
Commerce
I conducted my University of
internship at the Punjab
State Bank of Pakistan,
Karachi. During this internship I
prepared a report on “Reserve
Date: 2011-10-28
Yours obediently,
Abubakar Riaz
B.Com Honors
Roll No. 478
Section “G” Morning
Hailey College of Commerce,
University of the Punjab, Lahore.
Acknowledgement....................................................................................................2
List of illustrations.....................................................................................................5
Executive summary..................................................................................................6
Introduction of SBP..................................................................................................9
History......................................................................................................................9
Core Functions of State Bank of Pakistan..........................................................11
Regulation of Liquidity.........................................................................................11
Regulation and Supervision................................................................................12
Exchange Rate Management and Balance of Payments...................................13
Developmental Role of State Bank.....................................................................14
Statutory Obligations...........................................................................................15
Vision Statement....................................................................................................18
Mission Statement..................................................................................................18
Core Value..............................................................................................................18
Organizational Structure.........................................................................................19
Central Board of Directors..................................................................................20
Ratio Analysis.........................................................................................................21
Current Ratio.......................................................................................................21
Debt ratio.............................................................................................................22
Interest Coverage Ratio......................................................................................23
Operating Profit Margin.......................................................................................23
Net Profit Margin.................................................................................................24
Return on Assets.................................................................................................25
Trend Analysis........................................................................................................26
Horizontal Analysis Interpretation.......................................................................32
SWOT Analysis......................................................................................................42
Strengths.............................................................................................................42
Weakness...........................................................................................................44
Figures
Figure 1 Organogram.............................................................................................19
Figure 2 Current ratio.............................................................................................21
Figure 3 Debt Ratio................................................................................................22
Figure 4 Net Profit Margin......................................................................................24
Figure 5 Return on Assets......................................................................................25
Figure 6 Net Assets................................................................................................34
Figure 7 Total Assets.............................................................................................38
Figure 8 Assets and Liabilities...............................................................................40
Figure 9 Organizational Structure of RBA..............................................................49
Figure 10 Decision Making Structure.....................................................................50
Figure 11 Horizon Analysis....................................................................................54
Figure 11 Horizon Analysis
Tables
Table 1 Current Ratio.............................................................................................21
Table 2 Debt ratio...................................................................................................22
Table 3 Interest Coverage Ratio............................................................................23
Table 4 Operating Profit Margin.............................................................................23
Table 5 Net Profit Margin.......................................................................................24
Table 6 Return on Assets.......................................................................................25
Table 7 Horizontal Analysis: Balance Sheet of Issuing Department.....................26
Table 8 Horizontal Analysis: Balance Sheet of Banking Department....................27
Table 9 Horizontal Analysis: Profit and Loss Account...........................................30
Table 10 Vertical Analysis: Balance Sheet of Issuing Department........................33
Table 11 Vertical Analysis: Balance Sheet of Banking Department......................35
Table 12 Vertical Analysis: Profit and Loss Account.............................................39
Table 13 Official Reserve Assets of Australia........................................................47
Table 14 Currency, Asset, and Duration Benchmarks...........................................53
Table 15. Composition of Individual Portfolio Benchmarks...................................55
Table 16 Balance Sheet Issuing department.........................................................69
Table 17 Balance Sheet Banking department.......................................................70
EXECUTIVE SUMMARY
State Bank of Pakistan is the Central Bank of the country. While its
constitution, as originally lay down in the State Bank of Pakistan Order 1948,
remained basically unchanged until 1st January 1974 when the Bank was
nationalized, the scope of its functions was considerably enlarged. The State
Bank of Pakistan Act 1956, with subsequent amendments, forms the basis of its
operations today.
Under the State Bank of Pakistan Order 1948, the Bank was charge with
the duty to "regulate the issue of Bank notes and keeping of reserves with a view
to securing monetary stability in Pakistan and generally to operate the currency
and credit system of the country to its advantage". The scope of the Bank’s
operations was considerably widened in the State Bank of Pakistan Act 1956,
which required the Bank to "regulate the monetary and credit system of Pakistan
and to foster its growth in the best national interest with a view to securing
monetary stability and fuller utilization of the country’s productive resources".
Like a Central Bank in any developing country, State Bank of Pakistan
performs both the traditional and developmental functions to achieve macro-
economic goals. [8]
HISTORY
Regulation of Liquidity
Being the Central Bank of the country, State Bank of Pakistan has been
entrusted with the responsibility to formulate and conduct monetary and credit
policy in a manner consistent with the Government’s targets for growth and
inflation and the recommendations of the Monetary and Fiscal Policies Co-
ordination Board with respect to macro-economic policy objectives. The basic
objective underlying its functions is two-fold i.e. the maintenance of monetary
stability, thereby leading towards the stability in the domestic prices, as well as the
promotion of economic growth.
Statutory Obligations
Statutory Cash Reserve
In terms of Section36(1) SBP Act, 1956, every scheduled bank is required
to maintain with State Bank a balance the amount of which shall not at the close
of business or any day be less than such percentage of Time & Demand Liabilities
in Pakistan as may be determined by State Bank.
Annual Accounts
At the expiration of each calendar year every banking company
incorporated in Pakistan, in respect of all business transacted by it, and every
banking company incorporated outside Pakistan, in respect of all business
transited through its branches in Pakistan, shall prepare with reference to that
year a balance-sheet and profit and loss account as on the last working day of the
year in the prescribed forms (Section 34 of Banking Companies Ordinance, 1962).
Submission of Returns
The accounts and balance-sheet referred to in section 34 together with the
auditor’s report as passed in the annual General Meeting shall be published in the
prescribed manner, and three copies thereof shall be furnished as returns to the
State Bank within three months of the close of the period to which they relate
(Section 36 of Banking Companies Ordinance, 1962).
To transform the SBP into a modern and dynamic central bank, highly
professional and efficient, fully equipped to play a meaningful role on
sustainable basis in the economic and social development of Pakistan.
MISSION STATEMENT
CORE VALUE
1. Trust
2. Openness
3. Team work
4. Courage
5. Commitment to excellence
6. Problem solving approach
Figure 1 Organogram
Central Board of Directors
1. Yaseen Anwar Acting Governor Chairman
Current Ratio
Current ratio=Current AssetsCurrent Liabilities
Interpretation
The current ratio is one of the most used ratios that measure the solvency
of firm and its ability to pay the short term obligation. As shown in the table in
2008 the bank has 2:61 ration which means that if it has two rupee it has to pay
61 paisa as liability that is pretty much good ratio in banking sector. If we look at
the 2009 the ration has increased to 2:98 means for every two rupee it has to pay
98 paisa as liability. This ratio is adverse as compared to 2008 because the
liabilities have increased due to IMF loan and other conditional foreign loans.
Debt ratio
Debt ratio=Total LiabilitiesTotal Assets * 100
Interpretation
The debt ratio measures the proportion of assets financed by the outsider’s
money. The higher the ratio the greater the amount of other people’s money being
used to generate the revenue. The bank has almost same ratio in the two years
that shows its assets are financed up to 71% by the credit money that is not a
good sign because it reduces the confidence of investors and this is acceptable
up to 60% only. This ratio shows that bank has taken so many loans to run its
affairs.
Interpretation
This ratio shows either the firm is able to meet its contractual interest
payment. The higher the ratio the higher the ability to make its interest payment
the state bank has well figure that shows it can easily meet its interest obligations
in 2008. On the other hand it has also good current ratio that depict that it is able
to meet its obligations.
Interpretation
The operating profit margin shows the percentage of each rupee remain as
profit after the deduction of costs and all expenses except interest and taxes. The
91.76% shows that bank is earning almost 92 paisa and 8 paisa is going under
the head of expenses. The higher the ratio better the firm is earning.
Interpretation
The net profit margin shows the percentage of each rupee remain as profit
after the deduction of costs and all expenses including interest and taxes. Higher
net profit margin is preferable. The SBP net profit margin has increased in 2009
as compared to 2008 which shows that bank has greater profit in the year of 2009.
Interpretation
This ratio measures the effectiveness of management that how it uses the
available assets to generate revenue. Higher the ratio better is the position. In
case of SBP it is also increased from 14.62 %to 14.81% in the FY of 2009 which
shows the good indicator of bank performance.
Balance Sheet
Horizontal
Analysis in %age
State Bank of Pakistan: Issuing department
based on year
2007
Balance Sheet
(Rupees in ‘000’)
Items
2007 2008 2009 2008 2009
Assets
Gold reserves held
81,277,106 130,970,552 157,543,551 61.14 93.84
by the Bank
Foreign currency
685,468,587 439,104,769 378,121,392 -35.94 -44.84
reserves
Special Drawing
12,383,051 11,632,215 6,318,150 -6.06 -48.98
Rights of the IMF
Notes and coins:
Indian notes
representing
638,249 683,678 727,665 7.12 14.01
assets receivable
from the Reserve
Bank of India
Coins 3,012,270 2,718,036 2,496,236 -9.77 -17.13
Total: notes
3,650,519 3,401,714 3,223,901 -6.82 -11.69
and coins
Investments 108,830,311 458,259,765 675,410,375 321.08 520.61
Commercial 78,500 78,500 78,500 0.00 0.00
papers held in
Bangladesh
(former East
LIABILITY
Bank notes issued 893,428,399 1,046,039,412 1,223,717,612 17.08 36.97
LIABILITIES
Bills payable 571,942 1,224,446 827,785 114.09 44.73
Current accounts of
142,197,558 70,823,348 66,621,868 -50.19 -53.15
the Governments
Current account with
SBP Banking
2,369,636 3,702,522
Services Corporation-
a subsidiary
Securities sold under 61,816,757 6,758,751 -89.07 -100.00
agreement to
Deposits of banks
and financial 305,168,576 424,549,382 273,739,781 39.12 -10.30
institutions
Other deposits and
104,135,996 145,601,026 167,779,189 39.82 61.12
accounts
Payable to the IMF 85,063,742 91,263,686 419,003,041 7.29 392.58
Other liabilities 72,229,063 60,279,837 43,016,815 -16.54 -40.44
771,183,634 800,500,476 974,691,001 3.80 26.39
Deferred liability -
staff retirement 11,484,789 12,183,991 4,204,684 6.09 -63.39
benefits
Capital grant rural
finance resource 59,431 59,430 0.00 -100.00
centre
Deferred liability -
staff retirement 3,939,778 4,204,684
benefits
Deferred income 340,845 206,244 193,549 -39.49 -43.21
Total liabilities 783,068,699 812,950,141 979,089,234 3.82 25.03
Net assets 176,122,426 322,870,339 398,875,740 83.32 126.48
REPRESENTED BY
Share capital 100,000 100,000 100,000 0.00 0.00
Allocation of special
drawing rights of the 1,525,958 1,525,958 1,525,958 0.00 0.00
IMF
Reserves 67,138,769 76,288,533 172,704,657 13.63 157.24
Unappropriated profit 9,139,871 96,440,491 49,025,682 955.16 436.39
77,904,598 174,354,982 223,356,297 123.81 186.70
Unrealized
appreciation on gold 79,440,921 129,768,343 156,772,429 63.35 97.34
reserves
Surplus on
revaluation of
18,747,014 18,747,014 18,747,014 0.00 0.00
property and
equipment
Minority interest 29,893 0 -100.00 -100.00
loans, advances
-73,964 -451,726 -100.00 510.74
and other assets
diminution in
value of -98,687
investments
- other doubtful
212,057 122,543 62,615 -42.21 -70.47
assets
138,093 122,543 -487,798 -11.26 -453.24
118,504,357 174,122,085 215,109,198 46.93 81.52
Less: General
administrative and 9,210,501 8,888,130 10,897,194 -3.50 18.31
other expenses
OPERATING
109,293,856 173,681,489 215,109,198 58.91 96.82
PROFIT
PROFIT FOR THE
108,732,613 164,793,359 204,212,004 51.56 87.81
YEAR
LIABILITY
Bank notes issued 1,046,039,41 1,223,717,61
100.00 100.00
2 2
2009
2008
2007
LIABILITIES
Bills payable 1,224,446 827,785 0.11 0.06
Current accounts of the
70,823,348 66,621,868 6.24 4.83
Governments
Current account with
SBP Banking Services 2,369,636 3,702,522
Corporation- a subsidiary
Securities sold under
6,758,751 0.60 0.00
agreement to repurchase
Deposits of banks and
424,549,382 273,739,781 37.38 19.87
financial institutions
Other deposits and
145,601,026 167,779,189 12.82 12.18
accounts
Payable to the IMF 91,263,686 419,003,041 8.04 30.41
Other liabilities 60,279,837 43,016,815 5.31 3.12
800,500,476 974,691,001 70.48 70.73
Deferred liability - staff
12,183,991 4,204,684 1.07 0.31
retirement benefits
Capital grant rural
59,430 0.01 0.00
finance resource centre
Deferred liability - staff
3,939,778 4,204,684 0.35
retirement benefits
Deferred income 206,244 193,549 0.02 0.01
Total liabilities 812,950,141 979,089,234 71.57 71.05
Net assets 322,870,339 398,875,740 28.43 28.95
REPRESENTED BY
Share capital 100,000 100,000 0.01 0.01
Allocation of special 0.11
1,525,958 1,525,958 0.13
drawing rights of the IMF
Assets held
with the
Reserve Bank
of India
Gold reserves
Foreign
Investments
currency
reserves
SDRs
Total: notes
and coins
Gold reserves
Foreign currency reserves
SDRs
Total: notes and coins
Investments
Commercial papers held in Bangladesh (former East Pakistan)
Assets held with the Reserve Bank of India
Vertical Analysis in
State Bank of Pakistan:
%age based on
Banking department
interest Income
Income Statement
(Rupees in ‘000’)
items
2008 2009 2008 2009
Discount, interest /
mark-up and / or return 104,882,577 183,029,210 100.00 100.00
earned
Less: Interest / mark-up 3,748,759 8,085,169 3.57 4.42
expense Figure 7 Total Assets
101,133,818 174,944,041 96.43 95.58
Gross Margin 720,289 1,667,375 0.69 0.91
Commission income 61,973,254 34,725,139 59.09 18.97
Exchange gain- net 6,594,079 9,733,352 6.29 5.32
Dividend income 140,043 192,481 0.13 0.11
Profit earned through
subsidiaries
Other operating income
9,631,073 1,114,285 9.18 0.61
- net
Other income /
-442,148 52,020 -0.42 0.03
(charges) - net
179,611,917 222,428,693 171.25 121.53
Less: Direct operating
expenses
Bank notes printing
3,097,868 4,193,032 2.95 2.29
charges
Agency commission 2,710,017 3,614,261 2.58 1.97
(Provision) / reversal of
provision for:
loans, advances and
-451,726 0.00 -0.25
other assets
diminution in value of
-98,687 0.00 -0.05
investments
1,600,000,000
1,400,000,000
1,200,000,000
1,000,000,000
Rupees
Liabilities
800,000,000
Assets
600,000,000
400,000,000
200,000,000
0
2007 2008 2009
years
Strengths
Premier Institution
SBP in one of the premier bank of Pakistan that is responsible for
regulation of banking and monetary system of Pakistan since its inception. It
provides some guidelines time to time for proper working of financial and
monetary system in Pakistan.
Agent to Government
The SBP performs additional services for government by providing loans
and managing the government accounts as well as the other banks.
Employee Benefit
The employers at SBP are offered reasonable monetary benefit. Normally
bonuses are given. Employees also enjoy the interest free loans free medical care
of family and insurance of life. These serve as a benefit and competency for the
bank and a source of motivation for the employees.
Broad Network
The bank has another competency i.e. it has two subsidiaries one is the
NIBAF and second one is the BBP-Banking Services Corporation. SBP has 33
departments that are performing their own separate functions.
Professional Competence
The employees at SBP here have a good hold on their descriptions, as
they are highly skilled Professionals with better training programs in business
administration, banking, economics etc. These professional competencies enable
the employees to understand and perform the function and operation in better
way.
LRC
SBP has its own training department known as Learning Resource
Center(LRC) all the training programs are held over their even the international
seminars and meetings conducted over their.
Online Network
The bank has the strength of being powered by the network of computers,
which have saved time, energy and would have lessened the mental stress, the
employees have. This would add to the strength that is powered by network of
computers.
Weakness
Lack of Marketing Efforts
The bank does not promote its corporate image, services, etc on a
competitive way. Hence lacks far behind in marketing effort .A need for aggressive
marketing in there in the era marketing in now becoming a part of every
organization.
Political Pressure
The strong political hold of some parties and government and their
dominance is affecting the bank in a negative way. They sometime have to
Opportunities
Electronic Banking
The world today has become a global village because of advancement in
the technologies, especially in communication sector. More emphasis is now
given to avail the modern technologies to better the performances. SBP can utilize
the electronic banking opportunity to ensure on line banking 24 hours a day. This
would give a competitive edge over others.
Micro Financing
Because of the need for micro financing in the market, there are lot of
opportunities in this regard. Now the time has arrived when the SBP must realize
it and take on step to cater an ongoing demand and the Micro finance dept should
device policies to strengthen the micro finance network.
Data theft
The bank is currently dealing from data theft and the present technology in
Pakistan is not that effective and others are very costly in providing a safe place
on internet away from domestic and international hacks which threaten the
environment of the bank
Customer Complaints
There exists no regular and specific system of the removal of customer
complaints. Now a day a need for total customer satisfaction is emerging and in
their demanding consequences customer's complaints are ignored.
Australia
Australia’s foreign currency reserves are managed by the Reserve Bank of
Australia (RBA). Its Head office1 is in Sydney the value of gross reserves
portfolios is USD36, 342 Million on May 2010 [7]
Table 13 Official Reserve Assets of Australia
In Million of US Dollars
May 2010
Official reserve 36,341.71
(1) Foreign currency reserves (in convertible foreign 27,237.72
currencies)
(a) Securities of which: issuer 21,349.60
headquartered in reporting country but
located abroad
(b) total currency and deposits with: 5,888.12
(i) other national central 580.18
banks, BIS and IMF of
which: located abroad
(ii) banks headquartered 5,307.93
outside the reporting
country of which: located in
the reporting country
(2) IMF reserve position 1,031.15
(3) SDRs 4,585.92
(4) gold (including gold deposits and, if appropriate, gold 3,112.53
swapped)
-volume in millions of fine troy 2.57
ounces
(5) other reserve assets (specify) 374.39
-financial derivatives -0.14
-other 374.54
Organizational Structure
Responsibility for management of reserves is delegated by the Governor of
the Bank to the Financial Markets Group (FMG). Firstly international department
was responsible for both middle and front office function and back office was also
The Governor requires that reserves are accounted for in line with best practice and that
the level of transparency is consistent with that in other parts of the RBA’s monetary policy
operations. Senior managers overseeing front office operations are now responsible for day-to-
Analysis:
Approval of transaction from higher management means it
maximized control over the management process, but it makes decision
making unwieldy and, therefore, poorly suited to a more active risk
management framework. It also constrained initiative at manager levels.
So in order to move to more active management above system was
devised and a small and qualified amount of trading discretion was
delegated to managers in trading centers.
Active Management
No – More passive management is observed. Close to benchmark.
Analysis:
Before 2000, Short term investment decision made a positive
return from market. Whereas investment position in medium term
macroeconomics development also made positive returns in some years
but negative returns in others leaving a small positive returns from this
activity overall. This significantly reduced the importance of discretionary
management. [158]
Transparency and
accountability
The RBA publishes statistical information on its reserves and foreign
currency transactions in its monthly Bulletin. Also, since 1992, the Bank has
provided an overview of reserves management operations and return relative to
benchmark in its Annual Report. It is SDDS subscriber; Special data
dissemination standards, as an IMF member country it observes the standards
and reserves data template approved by IMF’s executive board.
Staffing policy
Staffing policy is another key element. The RBA has found considerable
benefit in specialization of professional staff in operational areas. Frequently
rotating staff in and out of these areas in order to provide a breadth of experience
was felt to be a significant constraint on maintaining adequate levels of experience
and knowledge. Over the past ten years, efforts have been made to maintain a
core of experience at senior levels within the operational areas while, at the same
time, allowing rotation at junior levels in order to build a foundation of experience.
Compensation is reviewed regularly to ensure competitiveness with other
organizations and staff is encouraged to participate in a range of courses. [171]
Statements
The RBA’s annual financial statements are prepared in accordance with
Australian Accounting Standards and other mandatory reporting requirements
contained in the Commonwealth Authorities and Companies Act. The statements
are scrutinized by an external auditor, the Australian National Audit Office, to
ensure that they comply with relevant standards. [173]
Analysis:
With the aim of maximizing the Bank’s capacity to intervene,
that’s way it’s decided that a trade weighted basket of currencies would
be an appropriate currency. The decision was taken to spread the
Composition of Benchmarks
The RBA has established benchmarks for the composition of each of the
three asset portfolios. These benchmarks are set out in Table 3. Like the other
benchmarks, practical and judgmental factors, combined with the liquidity
characteristics in each market, are important in deciding the appropriate asset
structure of the portfolios.
Analysis:
The desire to maintain a liquid and secure portfolio led the RBA
to limit its benchmark investments to government securities and cash
instruments. Typically, some 75 to 80 percent of the RBA’s benchmark
foreign investment portfolios are held in government paper.
For the European portfolio, the RBA has decided on a
combination of French and German government securities as the best
Cash Repo
Cash invested under repurchase agreements (repo) and deposits with
highly rated banks make up the balance of the asset benchmarks.
Analysis:
The RBA has found the short duration offered by deposits to be
attractive in markets where access to short-term government debt was
limited. They have also been a good, immediate source of liquid funds
during episodes of currency intervention. That said, the proportion of
foreign exchange reserves invested in deposits has declined in recent
years, reflecting tighter credit constraints and changes in cash
management practices. The RBA now makes greater use of cash repo,
which has the security advantage of being collateralized with
government securities. [181]
Instruments
In addition to the assets held in the benchmark portfolios, the RBA’s
dealing centers have discretion to hold a small range of other highly rated
instruments.
These include the [183]
• U.K. Gilts,
• Dutch and Swiss government paper,
• Deposits and medium-term notes issued by the Bank for
International Settlements.
Analysis:
With the exception of BIS deposits, these investments have
accounted for a negligible share of total holdings. Discretion to hold
Futures Contracts
In 1994, the Bank began trading interest rate futures contracts. Futures
trading have been concentrated in the European and Japanese portfolios. The
RBA does not use any over-the-counter or exchange-traded options in its
reserves management activities.
Analysis:
The decision for futures trading was driven by a desire to improve
management of market risk and, in particular, to provide a liquid hedging
instrument to minimize the risk of capital losses when interest rates were
rising. An additional attraction of using futures was the greater liquidity
and flexibility that they provide in some markets when implementing
investment strategies. Some futures markets are more liquid than their
underlying physical bond markets in that the bid-offer spread is usually
much narrower. [184]
Stock Lending
Stock lending is also an activity undertaken by the dealing centers.
Analysis:
Risk measurement and trading discretion around the duration
benchmark for each asset portfolio are based on the concept of “dollars-
at risk.” This is the change in portfolio value arising from a one basis
point change in yield. Within each of the portfolios, the dealing centers
are required to maintain dollars-at-risk to within US$70,000 per basis
point at all times. This limit applies to the aggregate position of the
portfolio and to the position undertaken in each maturity bucket of the
portfolio in order to control the amount of curve risk. [187]
Analysis:
The “dollars-at-risk” measure also forms the basis of the Value-at-
Risk (VaR) methodology, which the RBA has used since 1995 to
estimate the consolidated exposure of the Bank’s foreign currency
reserves to market risk. Though the overall limits to control market risk—
i.e., the discretionary trading bands around the benchmark—are not
defined in terms of VaR, the RBA has found that it nonetheless provides
a useful tool for conveying information about the overall portfolio
exposure to senior management and staff involved in reserves
management.[189]
Information System
All international transactions entered into by the RBA are processed
through a main-frame electronic Global Trading and Settlement System (GTS).
This system has been developed by an external software provider to their
specifications. [190]
State Bank of Pakistan is performing well as all of its operations are well
planned, organized and foolproof. However the micro finance activities are not still
satisfactory and need improvements. Followings are suggestion to enhance the
performance of State Bank of Pakistan.
• At the very highest level, the decision-making AUTHORITY for the
investment of reserves should be clearly defined. This hierarchy would
normally be established by the Governor or Board of Directors and would
include the overall objectives of reserves management.
• Senior management needs to specify a strategic long-term portfolio that
represents the best available trade-off between the different risks that the
reserve management entity is facing.
• There should be latitude for fund managers to deviate from benchmark in
foreign placements as provided by the RBA and BCRP (Peru).
• If SBP don’t want to do so then it can transfer the authority to the treasurer
to assign extra limit to their fund managers if they can provide the solid
reason to invest so they can invest in the best interest.
• The benchmarks should not short-term market expectations, but their
appropriateness should be reviewed regularly.
• Investment benchmarks are an important tool for assessing performance
and accountability. Where managers should be permitted to deviate from
the benchmark portfolio, performance and accountability will occur through
the comparison of performance of the actual portfolio and benchmark.
• Reserve management authorities should also subdivide their reserves
portfolio into "tranches" according to liquidity and investment objectives and
policy requirements.
• The risk management framework should apply the same principles and
measures to externally managed funds as it does to those managed
internally.
Training certificate
Liability
Bank notes issued 1,223,717,612
LIABILITIES
Bills payable 827,785
Current accounts of the Governments 66,621,868
Current account with SBP Banking Services
3,702,522
Corporation- a subsidiary
Securities sold under agreement to repurchase
Deposits of banks and financial institutions 273,739,781
Other deposits and accounts 167,779,189
Payable to the IMF 419,003,041
Other liabilities 43,016,815
974,691,001
Deferred liability - staff retirement benefits 4,204,684
Capital grant rural finance resource centre
Deferred liability - staff retirement benefits 4,204,684
REPRESENTED BY
Share capital 100,000
Allocation of special drawing rights of the IMF 1,525,958
Reserves 172,704,657
Unappropriated profit 49,025,682
223,356,297
Unrealized appreciation on gold reserves 156,772,429
Surplus on revaluation of property and equipment 18,747,014
Minority interest
398,875,740
• [156 -190] refers to the paragraph numbers from the “Guidelines for
foreign exchange reserves management: Accompanying document”.
• [1] International Reserves and Foreign Currency Liquidity IMF
http://www.imf.org/external/np/sta/ir/IRProcessWeb/data/aus/eng/curaus.ht
m#I
• [2] http://www.investopedia.com/
• [3] http://www.businessdictionary.com/
• [4] http://en.wikipedia.org/wiki/Main_Page
• [5] http://financial-dictionary.thefreedictionary.com/
• [6] Special Data Dissemination Standard IMF
http://dsbb.imf.org/Pages/SDDS/Overview.aspx
• [7] Wikipedia http://en.wikipedia.org/wiki/List_of countries by foreign
exchange reserves
• [8] State Bank of Pakistan Website link: www.sbp.org.pk
• Guidelines for foreign exchange reserves management.
http://www.bcentral.cl/eng/financial-operations/pdf/Guidelines%20for
%20Foreign%20Exchange%20Management%20FMI%202004.pdf
• Guidelines for foreign exchange reserves management:
Accompanying document.
http://www.bcentral.cl/eng/financial-operations/
• Issues in reserves Adequacy and Management.
Link: http://www.imf.org/external/np/pdr/resad/2001/101501.pdf