Guidelines for Investor Portfolio Securities Accounts (IPS)
Samba Bank Limited is offering Investor Portfolio Securities accounts (IPS) to its customers.
IPS Accounts are custodial accounts maintained for activity and holding of Government of Pakistan (GOP) Securities (T-Bills, PIBs, PIB-FL) on behalf of their customers. The types of Government securities that customers can invest through IPS account are:
Treasury Bills (T-Bills)
Treasury bills are zero coupon instruments(discounted) issued by the Government of Pakistan and sold through the SBP via fortnightly auctions. Salient features are:
- Issued in tenors of 3, 6 and 12 months
- Denominated in multiples of PKR 5,000*
- Applicable withholding tax is deducted at source by SBP upon maturity
- Non-paper instrument
- Negotiable instruments and have an active secondary market
- Redemption of the face value upon maturity is guaranteed by GoP
Pakistan Investment Bonds (PIBs)
PIBs Fixed & Floating are long-term bonds issued by the Government of Pakistan issued through SBP. Salient features are:
- Issued in tenors of 3, 5, 10, 20 years
- Denominated in multiples of PKR 100,000 *
- PIBs Fixed of different tenors bear different coupon rates which are payable semi-annually
- PIBs Floating of different tenors bear different coupon reset rates which are payable Quarterly & Semi-annually
- Applicable withholding tax is deducted at source by SBP on the interim coupon payments made
- Non-paper instrument;
- Negotiable instruments and are traded in the secondary market;
- Redemption of the face value upon maturity and periodic coupon payments are guaranteed by GoP.
Investment in Government Securities
Customers interested in buying GOP Securities, need to follow the steps stated below:
- In order to open an IPS account, customer must have a bank account (Current /Saving) with Samba Bank Limited.
- After a normal account is opened (Current /Saving) with Samba Bank, the customers will submit a duly filled IPS Account Opening Form (Available with our branches) accordingly. The IPS account will operate according to the instruction in main PKR account.
- After the IPS account has been opened, the customers can send e-mail via their registered e-mail address to branch /RM for Buy/Sale of GoP Securities from/to Samba Treasury or from/to Secondary Market through Samba Treasury.
- After the transaction confirmation is received by the customer via e mail, the customer will submit the required documents according to the information from the branch/RM. This process is for all Buy/Sale transaction along with some specific document required that will be communicate to the customer accordingly.
- Terms and conditions for IPS account will be same as mentioned on PKR AOF and some specific on IPS AOF.
The detail of IPS charges are given in our Schedule of charges (SOC*) along with minimum amount of investment.
Disclosure of Prices & Risks:
Samba Bank Limited (SBL) is not acting as investment manager for the IPS Accounts, neither as an investment, legal or tax advisor to the Customer(s) and SBL's duty is solely to act as a custodian of Security (ies) in accordance with the terms of the IPS Accounts and execute transactions as requested by the Customer (s) in the manner set out in these Terms & Conditions of IPS Accounts. SBL shall not be obliged to sell or repurchase any Security which it may have previously sold to or acquired by the Customer(s).
- The Securities are subject to fluctuation in the current/face value, including possible loss of principal amount. Principal value of the Securities is not capital protected or insured by any entity including Governmental agencies and are not bank deposits or obligations of or guaranteed by SBL or any of its affiliates. SBL will act solely as a Custodian of Securities and does not impart advice on the part of SBL. The Securities are neither developed, nor recommended by SBL and the SBL shall not be held responsible in any manner whatsoever in this respect.
- The Customer (s) represents, acknowledges and warrants that it understands the nature of the Transactions in IPS Account and the risks inherent in dealings /investments in such Securities and that it shall not rely on SBL for any decisions regarding the Transactions and shall use independent sources to obtain information and advice required to make such decisions.
- The Customer (s) are advised to carefully consider the investment objective, risks, prices, charges and expenses before investing in any offering – SBL shall not be liable for any decisions made by the Investors / Customer (s) in respect of their investments.
- SBL shall not be bound to inform the Customer (s) to any changes in the market for the Securities, any return thereon or any other regulatory, legal, fiscal or other change which may adversely affect the value, return, redeemability or other feature of the Securities. The Customer (s) affirms that it shall independently evaluate the investment in such Securities and the continued holding of such Securities by the Customer (s).