April 24, 2019 (MLN): The banking sector spread for the month of March-2019 has increased to 5.68%, marking a growth of 17 basis points (bps) over the previous month. The banking spread, however, jacked up by 103 bps as against spread of 4.65% in the same period last year.
As per the data released by the State Bank of Pakistan on Weighted Average Lending & Deposit Rates, the lending rate for all banks (inclusive of zero markup) in Mar-19 stood at 10.69% whereas the deposit rate stood at 5.01%.
It is pertinent to mention that the Central Bank made significant changes to the monetary policy during the month, wherein it increased the policy rate by 50bps, which brought up the interest rate to 10.75%.
The interest rate hike was applicable from April 01, 2019, and while expectation of the interest rate being raised would have been factored into the Lending rates to some extent, the effect would be visible in April's Lending & deposit rate.
Copyright Mettis Link News