State Bank Case Study

3. Expansion and Creation of Financial Institutions: The State bank as the banker of the banks expand the banking sector and improve its currency and credit system over the time. Pakistan is a big country with huge population to meet the needs to such a large population. The State Bank pave the way for more financial institutions to provide financial products to every Pakistan. State Bank not only strengthens the financial institution in urban areas but also try to provide credit facilities in the rural areas such as Micro Finance banks. State Bank of Pakistan is working on its target of a well-developed banking system in Pakistan since the independence.
The State Bank of Pakistan extends the branching network to approximately all part of
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Debt Management : The State Bank have its influcece on the capital and money market which are variables in the debt management . These markets possed of wide range of debt securities from treasury bills to bonds etc. The State Bank develops capital and money market of the country with different promotional techniques. State Banks performs the buying and selling of government securities to make changes in the public debt . When the government is in need of finance the debt securities are floated in the market by State Bank with intrest rate policy influencing such actions. It also encourages the funding of debt by other non-government instituions.
8. Credit Control : The State Bank through qualitative and quantitative tools control the credit pattern in the coutry and maintaining stability. The following are the quantitave methods used by the State Bank of Pakistan.
Bank Rate : The State Bank of Pakistan regulates the pattern of economic activity by using bank rate policy. The rate at which the State Bank of Pakistan make lending to the commerical bank. Some times the bank increases the bank rate resulting in low borrowing by genral public through commerical banks . If State Bank wants to increase the borrowings it decreases the bank rate which results in more borrowings by general public.
Open Market Opreations : Open market opreations are perform by the State Bank to buy or sell securities to control the flow of the

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