Deposits climb 15% year-on-year to an all-time high despite lower interest rates and shifting investment conditions
KARACHI: Bank deposits in Pakistan reached a record Rs39.81 trillion at the end of June 2026, registering strong double-digit growth despite a significant reduction in interest rates during most of the fiscal year, according to the latest data released by the State Bank of Pakistan (SBP).
The central bank’s banking statistics showed that deposits held by scheduled banks rose to an all-time high of Rs39.81 trillion as of June 30, 2026, highlighting the resilience of the country’s banking sector.
Deposits rise 15% year-on-year
The latest figures showed that bank deposits increased by 15 percent compared with Rs34.59 trillion recorded at the end of June 2025.
On a monthly basis, deposits also posted strong growth, rising by more than 7 percent from Rs37.05 trillion at the end of May 2026.
The increase pushed Pakistan’s banking deposits to their highest level on record, providing financial institutions with a significantly larger funding base.
Deposit growth continues despite lower interest rates
Financial analysts noted that the continued growth in deposits was particularly significant as it occurred during a period of declining interest rates.
During FY2025-26, the SBP reduced its benchmark policy rate from a historic 22 percent to 10.5 percent to support economic activity and stimulate private sector borrowing.
However, the central bank later raised the policy rate to 11.5 percent in its latest monetary policy decision in response to evolving inflationary pressures and external sector risks.
Despite lower returns on savings and deposits for much of the fiscal year, banks continued to attract substantial inflows from customers.
Investors favour banking system
Analysts attributed the increase in deposits partly to subdued economic activity, which encouraged businesses and investors to retain surplus funds in bank accounts rather than allocating them to higher-risk investment opportunities.
They also pointed to the traditional year-end surge in banking deposits, as financial institutions seek to strengthen their balance sheets and improve key financial ratios before the close of the fiscal year.
The record level of deposits provides banks with greater liquidity to support lending to businesses and consumers, while also reflecting continued public confidence in Pakistan’s banking system despite a changing interest rate environment.