SBP Governor urges banks to boost retail deposits, private-sector lending

State Bank of Pakistan Governor urged commercial banks to reshape their business models around stronger retail deposit mobilisation and more lending to the private sector. Speaking at the 11th Pakistan Banking Awards in Karachi on August 22, he said the economy had held up through a difficult FY26 that included severe floods and geopolitical tensions, according to Mettis Global.

He argued that stabilisation alone would not deliver high and sustainable growth, so banks have a particularly important role in the next phase. Banks' total assets reached Rs69 trillion and deposits stood at Rs43 trillion at end-June 2026, while profitability stayed strong and capital adequacy remained well above requirements. Foreign exchange reserves moved above the $18 billion target set for end-June, mainly through SBP's own dollar purchases rather than borrowing.

The Governor noted that bank assets and deposits are low relative to GDP compared with other emerging markets, and urged lenders to compete for retail deposits by offering attractive returns along with quality services. He also said private-sector credit has dropped markedly as a share of GDP over three decades, and government borrowing alone does not explain this. The awards, organised by NIBAF Pakistan with Dawn Media Group and A. F. Ferguson & Co, saw Meezan Bank named Best Bank.