ISLAMABAD: The banking sector in Pakistan has shown notable growth in its gross advances, with the Gross Advances-to-Deposits Ratio (ADR) increasing to 44% as of October 25, 2024, up from 39% recorded on September 27, 2024. This uptick reflects an 11% rise in gross advances, which reached Rs 13.4 trillion.
However, while credit growth is on the rise, the sector has faced a slight decline in deposits, which fell by 1% to Rs 30.5 trillion during the same period.
According to weekly data from Topline Research, this shift in the banking sector’s performance shows a growing demand for loans, even as deposit growth stagnates. The increase in the ADR ratio signals that banks are leveraging their deposits more efficiently to extend credit, potentially due to greater borrowing activity in the economy.
The data indicates that while the banking sector remains robust in terms of lending, the slight decrease in deposits may raise questions about liquidity trends and the overall stability of the sector in the coming months.
