Bank deposits hit all-time high of Rs25.6tr in FY23

December 02, 2023 (MLN): Bank deposits jumped to an all-time high of Rs25.6 trillion by the end of June 2023, according to the annual report released by the Deposit Protection Corporation (DPC) on Friday.

Correspondingly, the volume of eligible deposits recorded a net increase of Rs1.8tr during the same period and stood at Rs14tr by the end of June 2023.

However, the YoY trend revealed a slowdown in the pace of deposits mobilization during FY23 as compared to FY22.

The growth of deposits. decelerated to 12% during FY23 from 15% witnessed during the previous year, the report added.

The increase in total deposits can be attributed to factors such as the higher rate of return offered in the wake of a tighter monetary policy stance and the expansion of banks' branch network.

While the deceleration of deposit mobilization may be accredited to macroeconomic uncertainty, including inflationary pressures, a slowdown in the inflow of foreign remittances by Pakistani diaspora could be another factor for the deposit deceleration.

As of June 30, 2023, 98.9% of total depositors of conventional banking and 98.7% of total depositors of Islamic banking are eligible for deposit protec- tion in case of a bank failure, the report further revealed.

While in terms of value, 52% of conventional banking and 63% of Islamic banking deposits are eligible for deposit protection.

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