Karachi: The State Bank of Pakistan (SBP) has imposed a penalty of Rs13.99 million on Standard Chartered Bank Pakistan Limited for regulatory violations during the calendar year 2025, according to the bank’s latest annual report submitted to the Pakistan Stock Exchange (PSX) on Thursday.
The report revealed that the penalty amount declined significantly compared to Rs71 million in 2024, indicating improved compliance by the bank over the past year.
The State Bank of Pakistan routinely imposes fines and penalties on banks and financial institutions for various regulatory breaches to ensure adherence to banking regulations and maintain the stability and transparency of the financial system.
Financial Performance in 2025
Despite the penalty, Standard Chartered Bank Pakistan Limited reported a resilient financial performance for 2025. The bank recorded a profit before tax of Rs58.5 billion, though it was lower than Rs100.6 billion posted in the previous year.
The bank’s revenue declined by Rs37.6 billion, primarily due to a sharp reduction in interest rates, which resulted in margin compression. However, the impact was partially offset by a decline in the cost of funds.
Operating expenses increased 6% year-on-year, reflecting inflationary pressures as well as investments in workforce development and infrastructure. Meanwhile, the bank’s prudent risk management strategy and strong recoveries from bad debts resulted in a net release of Rs1.8 billion during the year.
Deposits and Lending Trends
On the liabilities side, total deposits of Standard Chartered Bank Pakistan Limited stood at Rs650 billion, marking a 22% decline from the beginning of the year. The bank attributed the decrease to its deposit optimization initiative, which improved the current account mix to 59% of the deposit portfolio, compared with 48% a year earlier.
On the asset side, net advances increased by Rs43 billion, representing a 25% growth since the start of the year, reflecting improving economic activity and rising demand for credit.
Tax Contributions to National Exchequer
The bank also highlighted its contributions to the national treasury. During 2025, it paid Rs28.7 billion in income taxes to the government, compared with Rs59 billion in 2024, reflecting an effective tax rate of 50.8%.
In addition, the bank collected Rs21.4 billion in withholding taxes on behalf of the government under various provisions of the Income Tax Ordinance, 2001. It also paid Rs2.1 billion in Federal Excise Duty and Provincial Sales Taxes during the year.
Outlook
Standard Chartered Bank Pakistan Limited stated that it continues to closely monitor Pakistan’s economic environment and will adjust its portfolio strategy accordingly. The bank said it remains well positioned to meet client needs while building a profitable, efficient, and sustainable banking portfolio in the country.