Recent data released by the State Bank of Pakistan (SBP) highlights significant growth in banking deposits and investments, with a minor decrease in advances as of April 2024 compared to the previous year.
Banking deposits soared by over 21 percent, reaching Rs. 28.4 trillion in April 2024, up from Rs. 23.4 trillion in April 2023. This substantial rise indicates increased trust and financial activity among customers, marking a positive trend in the banking sector.
However, advances saw a slight decline of 0.7 percent year-over-year, amounting to Rs. 12 trillion in April 2024 compared to Rs. 12.1 trillion in April 2023. Despite this decrease, advances remain a vital component of banking operations, providing essential credit and financial support to businesses and individuals.
Investments, on the other hand, experienced a significant upswing, growing by 38.5 percent year-over-year to Rs. 27.3 trillion in April 2024, up from Rs. 19.7 trillion in April 2023. This growth reflects a strategic allocation of funds by banks, contributing to economic development and financial stability.
The advance-to-deposit ratio was 42.3 percent in April 2023, reflecting a decrease of 936 basis points year-over-year. Conversely, the investment-to-deposit ratio increased to 96 percent in April 2024, up 1,194 basis points year-over-year, indicating a higher proportion of deposits allocated towards investments.
These figures demonstrate a positive trajectory in the banking sector, showcasing resilience and adaptability amidst evolving economic conditions. The increase in deposits and investments, along with prudent management of advances, reflects a healthy and robust financial landscape within the banking industry.