Published On: Tue, Dec 31st, 2013

Increase in lending by Banks to the Private Sector

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Corporate News (Pakistan News) LENDING BY BANKS

Corporate News (Pakistan News)

The lending by Banks to the private sector rose to Rs. 175 billion in the first five and a half months of this fiscal year, if compared to the statistics of the previous fiscal year in which the same value was Rs. 19bn. This escalation further justifies the statement made the finance minister, Ishaq Dar who saw the economy growing at a rate of over 4pc in the upcoming days. However the private sector eyes this growth only if certain conditions such as uninterrupted power supply and cheaper liquidity, are fulfilled.

The banking sector was skeptical of the liquidity supply in the upcoming future because there is a danger of increasing inflation and interest rates. According to a report issued by the State Bank all banks’ non performing loans decreased from a value of Rs11 billion to Rs603.7bn during the third quarter (July-Sept) of the current calendar year. This may have been a result of the banks showing interest to put their entire liquidity into the risk-free government papers.

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