The banking sector’s gross Advance-to-Deposit Ratio (ADR) reversed its downward trajectory, clocking in at nearly 40% as of December 2025.
The banking sector’s ADR stood at 39.8% as of December 2025, up from 37.9% recorded in November 2025, reflecting an increase of 182 basis points (bps), stated brokerage house Arif Habib Limited (AHL) on Thursday.
However, yearly, the ADR was down 1,311bps, compared to 52.9% in December 2024.
The banking sector’s Investment-to-Deposit Ratio (IDR) lowered to 101.3% in December 2025, as compared to 103.8% in November 2025, registering a decline of 254bps. However, on a year-on-year basis (YoY), IDR was up 509bps, compared to 96.2% in December 2024.
The yearly increase in IDR indicates that banks are heavily investing in government instruments, possibly due to attractive yields, low credit appetite, or limited private sector demand.
As per the data, the banking sector’s deposits saw strong growth both YoY (23.6%) and month-on-month (MoM) (5.8%), rising to Rs37.4 trillion in December 2025.
Investments grew faster than both deposits and advances YoY (30.1%), clocking in at Rs37.9 trillion in December 2025.
Advances (loans) stood at Rs14.9 trillion in December 2025, registering a growth of 10.9% MoM but were down 7.1% on a yearly basis.
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