The State Bank of Pakistan (SBP) has expressed concern over the delay in the repayment of a National Bank of Pakistan (NBP) loan linked to the Roosevelt Hotel, according to discussions held during a recent meeting of the Economic Coordination Committee (ECC), The Express Tribune reported.
The issue was raised as the ECC reviewed Pakistan International Airlines Investment Limited’s (PIAIL) request for $17.6 million in financial support to cover liabilities following the termination of the Roosevelt Hotel’s lease agreement with New York City.
During the meeting, officials informed the committee that the liabilities included union dues, real estate taxes, insurance claims, interest to be paid to NBP, and general administrative costs.
The SBP noted concern over the delayed repayment of NBP’s loan, while the adviser to the prime minister on privatisation suggested that the liabilities could be managed in phases with proper planning.
The ECC observed that PIAIL had not converted the NBP’s foreign exchange loan into a rupee-based facility as previously recommended. The Finance Division added that it had not yet received PIAIL’s financial statements, only those of the Roosevelt Hotel and PIA Holding Company Limited.
The committee directed the ministry to reassess the financial proposal within a week, rationalise the required amount in consultation with the Finance Division, NBP, SBP, and Privatisation Commission, and resubmit the proposal after approval from PIAIL’s board. The ECC also instructed PIAIL to submit its latest audited financial reports to the Finance Division.
The Roosevelt Hotel was reopened in May 2023 after COVID-19 shutdowns under a Migrant Business Arrangement with New York City, which leased the property for three years with an 18-month guarantee period. The arrangement was terminated effective June 30, 2025, following a change in U.S. administration.
PIAIL reported that the hotel earned $166 million during the lease period but faced total liabilities and operating costs of $169 million, leaving a shortfall of $3.54 million. With no new revenue stream after the lease termination, PIAIL projected a $28.6 million carrying cost from July to December 2025.
The Finance Division has requested a financial report from PIAIL and details of cash inflows expected from a potential management contract with High Gate Capital. The ECC will review the revised proposal once submitted.
