SFD signs agreement to extend $3b deposit with SBP

The Saudi Fund for Development (SFD) on Friday signed an agreement with the State Bank of Pakistan (SBP) to extend the maturity of its $3 billion deposit, Radio Pakistan reported. “The agreement, signed between the Saudi Fund for Development (SFD) and the State Bank of Pakistan (SBP), provides for the extension in the maturity of a USD 3 billion deposit placed by SFD with the State Bank of Pakistan", according to X post. Finance Minister Witnesses Signing of Saudi Deposit Extension Agreement with State Bank of Pakistan Federal Minister for Finance and Revenue, Senator Muhammad Aurangzeb, witnessed the signing of an important financial agreement in Washington, D.C., in the presence of the… pic.twitter.com/2BCoaWPhNL — Ministry of Finance, Government of Pakistan (@Financegovpk) April 17, 2026 The agreement was signed by Sultan bin Abdulrahman Al-Marshad, Chief Executive Officer (CEO) of the SFD, and SBP Governor Jameel Ahmad, on behalf of SBP. Finance Minister Muhammad Aurangzeb witnessed the signing ceremony of an important financial agreement in Washington, DC, in the presence of Pakistan’s Ambassador to the United States, on the sidelines of the World Bank-IMF Spring Meetings 2026. According to the ministry X post, the extension underscores the strong and longstanding economic partnership between Pakistan and the Kingdom of Saudi Arabia. It is expected to support the country’s external sector stability. Yesterday, Pakistan received a $2 billion financial inflow from Saudi Arabia, offering timely relief to its foreign exchange reserves just as the country prepares to repay $3.5 billion to the United Arab Emirates (UAE) this month. Read: SBP receives $2 billion Saudi credit The SBP verified the receipt of the funds from Saudi Arabia's Ministry of Finance, while the finance ministry said the assistance forms part of a broader $3 billion financing commitment by Riyadh aimed at stabilising Pakistan's reserves. In addition, Saudi Arabia has assured the rollover of its existing $5 billion deposits for an extended period, removing the earlier requirement of annual renewals. Officials said this support would significantly ease pressure on reserves, particularly in light of the large UAE repayment, which accounts for nearly 18% of Pakistan's official foreign exchange holdings. The inflow comes at a critical juncture as Pakistan moves to meet its external financing needs and maintain reserve targets under its IMF programme. According to finance ministry sources, the government is aiming to raise reserves to around $18 billion, equivalent to roughly 3.3 months of import cover, in the coming months. At the same time, Islamabad has finalised arrangements to repay $3 billion to the UAE in a phased manner. Of this, $2 billion is expected to be paid on April 17, followed by the remaining $1 billion on April 23. Separately, Pakistan has already cleared a longstanding $450 million loan owed to the UAE. On Wednesday, FinMin said that Saudi Arabia has committed $3 billion in additional deposits, with disbursement expected in the coming week. He further stated that the existing $5 billion Saudi deposit would no longer remain subject to the earlier annual rollover arrangement and would instead be extended for a longer period. Additional IMF loan The government sources told The Express Tribune that it has been decided to seek an additional loan from the IMF under the existing package and there were high chances that the IMF would honour Pakistan's request. The IMF's managing director has said that her organisation was expecting $50 billion in financing requests from the member countries to deal with the Middle East war shocks. Read more: Saudi largesse plugs Pakistan's sudden reserve hole The sources said that the IMF executive directors were also urging the Fund management to either augment the existing programmes or provide new financing windows. They added that seeking a new financing facility from the IMF may not be possible, but the existing programme can be augmented with additional loans. Pakistan can avail up to 600% of its quota in the IMF, and so far, it has exhausted 350% of the total quota. The sources said that there was a $2 billion to $2.5 billion window available, which Pakistan wanted to utilise to handle the effects of the Middle East war. The sources said that Pakistan was eligible to avail the additional IMF financing to deal with the war shocks. They said that there were very high chances that the IMF would accept Pakistan's request for increasing the loan size. Extending a loan to Pakistan to deal with the war impact would not be a favour but supporting the country to pass through the crisis, said the sources. At 600% quota, Pakistan can avail a total of $16 billion loan and it has exhausted $9.5 billion. This makes a strong case for the augmentation under the existing Extended Fund Facility (EFF) programme.