ISLAMABAD: Rating agency Moody’s said on Wednesday the Pakistani government’s credit profile was stable on the back of reforms and policy effectiveness, adding that the country’s banking system reflected banks’ solid funding and liquidity, although a challenging operating environment would weigh on asset quality and profitability.
Moody’s published its outlook on the Pakistan Banking System titled, “Banking System Outlook – Pakistan: Stable outlook balances loan book and profitability pressure against stable funding and a resilient sovereign.”
“Despite a difficult environment, the government’s credit profile is stable due to ongoing reforms and increasing policy effectiveness – a positive for the banks given their outsized holdings of Pakistani government debt link their credit profiles to that of the government,” said Constantinos Kypreos, a Moody’s Senior Vice President. “Deposit-based funding and good liquidity buffers also remain strengths, while the probability of government support in a crisis is high, even if its ability to do so is limited by fiscal challenges.”
The report said restrictions in place to contain the spread of the coronavirus would keep economic activity below pre-outbreak levels but the Pakistani economy was expected to return to modest growth of 1.5% in fiscal 2021.
“Government and central bank policy responses and structural reforms will soften the pandemic’s impact but not fully offset it,” the report said. “In this environment, we expect private-sector lending to grow modestly, by 5%-7%, over the calendar year.”
Nonperforming loans (NPLs) would rise from a sector-wide level of 9.9% of gross loans at September 2020 as the economic slowdown took a toll on borrowers’ repayment capabilities, the report said. Banks’ foreign operations, export-oriented industries and companies that depend on government payments and subsidies would be hit hardest. Loan repayment holidays and other support measures would contain the deterioration, but not eliminate the risks entirely. Banks’ heavy exposure to government bonds would also continue to link banks’ credit profiles with the fiscal strength of the government.
The report also said capital was modest but would remain broadly stable and profitability had materially increased during 2020, but would come under some pressure in 2021: Net interest margins will narrow after a huge 625-basis-point interest rate cut in 2020. Together with rising provisioning needs and subdued business generation, this will curb bottom-line profits.
“The government remains willing to support troubled banks but its ability to do so is limited by fiscal challenges reflected in its B3 rating,” the report concluded.
Moody’s maintains stable outlook for Pakistan banks
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Moody’s maintains stable outlook for Pakistan banks
- Says despite difficult environment, government’s credit profile stable due to ongoing reforms and increasing policy effectiveness
- Pakistani economy expected to return to modest growth of 1.5 percent in fiscal year 2021 despite coronavirus restrictions
Pakistani province bordering Afghanistan to send talks’ delegation to Kabul within two weeks — CM
- Islamabad says it has consistently taken up the issue of cross-border militancy with Kabul
- Afghan Taliban say do not allow Afghan soil to be used by militants against other nations
ISLAMABAD: The chief minister of Pakistan’s northwestern Khyber Pakhtunkhwa province said this week he would send a delegation to neighboring Afghanistan within two weeks for discussions on ongoing tensions, including cross-border militancy.
Already strained relations between the neighbors have deteriorated in recent months amid a spike in militant attacks in Pakistan that it blames on insurgents harboring in Afghanistan. Kabul’s Afghan rulers deny state complicity and say they do not allow Afghan soil to be used by militant groups against other nations.
Last year, KP CM Ali Amin Gandapur said he would hold direct talks with Kabul and send an emissary to Afghanistan to arrange a meeting to resolve outstanding issues. At the time, the central government led by Prime Minister Shehbaz Sharif, a main rival of Gandapur’s PTI party that rules KP, said the offer amounted to a “direct attack on the federation” as no province could open talks with a foreign country, which was the jurisdiction of the government at the center.
“Now I will have to play my role. We held a provincial meeting and now I am sending a delegation to Afghanistan soon,” Gandapur told reporters on Monday. “Within two weeks a delegation that I am forming will go to Afghanistan and talk to them [Afghan government].”
A second delegation comprising main tribes from KP province would also visit Afghanistan subsequently, the chief minister added.
“A delegation comprising all tribes will also go and talk to them. I have full faith that they [Afghan authorities] will cooperate with our jirga.”
Islamabad says it has consistently taken up the issue of cross-border attacks with the Taliban administration. The issue has also led to clashes between the border forces of the two countries on multiple occasions in recent months.
In December, the Afghan Taliban said bombardment by Pakistani military aircraft in Afghanistan’s eastern Paktika province had killed at least 46 people, most of whom were children and women. Just days later, the Afghan defense ministry said Taliban forces targeted “several points” in neighboring Pakistan, further straining tense ties.
Relations between the two countries have also soured since Pakistan launched a deportation drive in November 2023 against illegal aliens residing in the country. Though Pakistan insists the campaign does not only target Afghans but all those residing in Pakistan unlawfully, it has disproportionately hit Afghans, with at least 800,000 repatriated so far.
KSrelief distributes food parcels to people in need in Mali, Pakistan
- Some 500 parcels distributed in Koulikoro region of Mali
- In Pakistan, 1,450 parcels given out in Sindh, KP provinces
RIYADH: Saudi aid agency KSrelief has provided food aid to people in need in Mali and Pakistan, reported the Saudi Press Agency.
Some 500 parcels were distributed in the Koulikoro region of Mali, benefiting vulnerable groups including displaced people and those with disabilities as part of this year’s Food Security Support Project in the country.
Meanwhile, in Pakistan, a further 1,450 food parcels were given out in the Dadu and Sanghar districts in Sindh province and the Torghar district of Khyber Pakhtunkhwa province.
Finishing touches being put on Pakistan stadiums ahead of ICC Champions Trophy
- Eight-team 50-overs tournament will be first global competition held in Pakistan in 28 years
- India will play all their matches in Dubai due to political tensions with the northern neighbor
LAHORE: The Pakistan Cricket Board (PCB) this week allayed fears about the preparedness of the venues for this year’s Champions Trophy as they welcomed media for a tour of Lahore’s Qaddafi Stadium on Monday.
The eight-team 50-overs tournament will be the first global competition to be held in Pakistan in 28 years.
India, however, will play all their matches in Dubai due to political tensions with their Northern neighbors.
Stadiums in Lahore, Karachi and Rawalpindi are being upgraded for the tournament whose success could invite more global tournaments to a country, which was deemed unsafe to tour after a 2009 attack on the visiting Sri Lankan cricketers.
“We are in the finishing phase. Our work is almost complete, the finishing touches remain. We will complete it by the end of this month,” PCB director of infrastructure, Qazi Jawad, told Reuters in Lahore.
The stadium’s capacity has been increased to accommodate 35,000 fans while new hospitality areas have also been constructed.
Lahore and Karachi will host a tri-nation series involving New Zealand and South Africa next month to prove their readiness for the Champions Trophy beginning on February 19.
Pakistan air force contingent lands in Saudi Arabia for aerial combat exercise
- Saudi Arabia annually hosts Spears of Victory exercise, with last year’s activity having involved more than 60 aircraft from nine nations
- This year’s exercise will include participation from Saudi Arabia, Pakistan, Bahrain, France, Greece, Qatar, UAE, UK and US
ISLAMABAD: A Pakistan Air Force contingent comprising JF-17 Thunder Block-III fighter jets and dedicated air and ground crew has landed in Saudi Arabia to participate in the multinational aerial combat exercise, “Spears of Victory-2025,” the Pakistan army said in a statement on Tuesday.
Saudi Arabia annually hosts the Spears of Victory exercise, with last year’s activity having involved more than 60 aircraft from nine nations. This year’s exercise will include participation of fighter jets and combat support elements from Saudi Arabia, Pakistan, Bahrain, France, Greece, Qatar, UAE, UK and the US.
“For this International deployment, PAF fighters flew nonstop from home base in Pakistan to Saudi Arabia, carrying out inflight Air-to-Air refueling, showcasing long range employment capabilities of JF-17 Block-III Aircraft,” the Pakistan army’s media wing said.
During the exercise, PAF pilots flying AESA & Extended Range BVR Equipped JF-17 Thunder jets will be pitched against participating air forces equipped with a wide variety of sophisticated combat aircraft.
Royal Saudi Air Force is holding the fifth cycle of the exercise, “which provides an excellent opportunity to bolster interoperability within the participating Air Forces in the backdrop of technological advancement, increasing complexity in Airpower application & shared aerial defense challenges,” the army statement said.
“Participation of Pakistan Air Force contingent in the exercise not only highlights PAF’s commitment to regional & international cooperation but also underscores its capabilities and prowess to operate in diverse and challenging environments among contemporary airforces.”
Outgoing US president Biden turns down clemency request for Pakistani neuroscientist
- Siddiqui is serving 86-year jail sentence after being convicted of attempting to shoot group of FBI agents, US soldiers and interpreters
- US officials say incident took place as FBI agents, soldiers were about to interrogate Siddiqui at Afghan police compound in Ghazni in 2008
KARACHI: The sister of Dr. Aafia Siddiqui, a Pakistani neuroscientist imprisoned in the US, on Tuesday called on supporters not to lose hope after outgoing US President Joe Biden rejected a petition seeking clemency for the jailed academic.
Siddiqui, a US-trained scientist who denies any wrongdoing, was convicted in 2010 and given a 86-year prison sentence for shooting at FBI agents and soldiers after her arrest in Afghanistan. She was arrested in July 2008 by Afghan police, who said she was carrying two pounds (900 grams) of sodium cyanide and crumpled notes referring to mass casualty attacks and New York landmarks.
The day after her arrest, according to the indictment, Siddiqui grabbed an M-4 rifle in her interrogation room and started shooting while yelling “death to America,” the trial jury heard. No US agents or soldiers were hit, but Siddiqui was shot and wounded in response, according to US prosecutors. She was subsequently convicted by a New York federal jury of attempted murder, armed assault and other charges. Siddiqui was never charged with links to terrorism.
Siddiqui’s family says she was visiting Pakistan in 2003 when she was abducted with her three children by Pakistani intelligence officials and handed to the Central Intelligence Agency (CIA), which took her to Afghanistan. Pakistan’s intelligence agencies deny the claims.
“You must all by now have heard the news that our [mercy] petition was denied at the very last moment,” Dr. Fowzia Siddiqui, who has been lobbying for years for her sister’s release, said in a video message.
The rejection comes in response to a 76,500-word dossier submitted by Siddiqui’s lawyer, Clive Stafford Smith, urging Biden to grant her clemency before the end of his term.
“We will go onto Plan B and Plan D but not lose hope. Please, I have not lost hope, so all I am asking you is to please stay steadfast, stay with me, join us for Plan B and please continue the support,” Fowzia added.
In October 2024, Pakistan’s Prime Minister Shehbaz Sharif also wrote a letter to Biden, calling for Dr. Siddiqui’s release. The letter highlighted concerns about her treatment in prison and warned that her deteriorating physical and mental health could lead to self-harm.
Freeing Siddiqui or winning her repatriation to Pakistan has at times been a popular cause in her homeland, where her trial was seen as unfair.
