KARACHI: Pakistan’s banking sector ended 2025 on a high note. Recent data from the State Bank of Pakistan (SBP) reveals that total bank deposits surged to Rs. 37.43 trillion in December 2025. This marks a significant recovery and robust growth for the financial sector.
Bank Deposits Maintain Strong Momentum
The numbers show a clear upward trend. Deposits increased by 5.8% month-on-month (MoM), rising from Rs. 35.38 trillion in November. Furthermore, the year-on-year (YoY) growth is even more impressive. Deposits jumped by 23.6% compared to Rs. 30.28 trillion in December 2024.
Topline Securities attributes this sharp YoY rise to a low base effect. Last year, deposits were suppressed due to taxes related to the Advances to Deposits Ratio (ADR). Looking ahead, analysts expect this momentum to normalise. Consequently, projections estimate deposit growth between 10% and 15% throughout 2026.
Advances & Lending Trends
While deposits grew, the lending side showed mixed signals. Total advances stood at Rs. 14.88 trillion in December. This represents a healthy 10.9% increase MoM from Rs. 13.42 trillion in November.
However, the yearly picture differs. Advances actually declined by 7.1% YoY from Rs. 16.01 trillion in 2024.
Because of the strong monthly inflow of advances against the relatively weaker momentum of deposits, the Advances to Deposits Ratio (ADR) tightened. The ADR rose to 39.8%, climbing 182 basis points (bps) within a single month.
Investments Reach New Heights
Banks continue to invest heavily. Total investments climbed to Rs. 37.91 trillion, showing a massive 30.1% YoY increase. On a monthly basis, investments grew by a modest 3.2%.
As a result, the Investment to Deposit Ratio (IDR) stands at 101.3%. Although this is down 254 bps from last month, it is significantly higher (up 509 bps) compared to the same period last year.
