New data on Pakistan banking sector deposits July 2026 shows the sector’s deposit base rose 13.9 percent year on year to Rs. 39.05 trillion, even as it fell 4.5 percent compared to the previous month. According to data compiled by the State Bank of Pakistan and Topline Research, deposits stood at Rs. 40.89 trillion in June before easing in July.
Breaking Down Pakistan Banking Sector Deposits July 2026
While the year-on-year growth reflects continued expansion in the banking sector’s deposit base, the month-on-month decline suggests some seasonal or cyclical pullback in July, a pattern that can occur following periods of elevated deposit inflows in prior months. The gap between annual growth and monthly contraction highlights how short-term fluctuations can mask a longer, more positive underlying trend.
Bank advances, which represent loans extended to businesses and individuals, also increased 9.7 percent year on year to Rs. 13.56 trillion in July from Rs. 12.36 trillion a year earlier. However, advances declined 5.7 percent month on month from Rs. 14.38 trillion in June, indicating weaker credit deployment during the month compared to the prior period.
Investments and Borrowings
Bank investments, which typically include holdings of government securities and other financial instruments, reached Rs. 40.83 trillion in July, up 12.8 percent year on year from Rs. 36.19 trillion a year earlier. On a monthly basis, investments fell 4.1 percent from Rs. 42.58 trillion in June, mirroring the broader monthly pullback seen across deposits and advances.
Bank borrowings stood at Rs. 16.54 trillion in July, rising 6.2 percent year on year from Rs. 15.58 trillion in July 2025. Borrowings also declined 6.1 percent month on month from Rs. 17.61 trillion in June, continuing the pattern of annual growth paired with monthly contraction across nearly all major banking sector indicators.
What the Ratios Reveal
The Advance Deposit Ratio, which measures the proportion of deposits deployed as loans, stood at 34.7 percent in July, down from 35.2 percent in June and lower than the 36.1 percent recorded in July 2025. A declining ADR can indicate banks are being more conservative with lending, or that deposit growth is simply outpacing loan demand in the current economic environment.
The Investment Deposit Ratio, meanwhile, stood at 104.6 percent in July, compared with 104.2 percent in June, though slightly lower than the 105.6 percent recorded in July 2025. An IDR above 100 percent means banks are holding more in investments than they have in total deposits, a pattern common in Pakistan’s banking sector given the historically high allocation to government securities.
Overall Balance Sheet Picture
The banking sector’s deposit base remains the largest component of its balance sheet, with deposits of Rs. 39.05 trillion compared with advances of Rs. 13.56 trillion and investments of Rs. 40.83 trillion in July. This structure, where investments now roughly match or exceed total deposits while loan advances remain comparatively modest, reflects the continued preference among Pakistani banks for holding government paper over expanding private sector lending.
For more detailed banking sector statistics, visit the State Bank of Pakistan’s economic data portal. For more banking and finance coverage, see our business news section.