Meezan Bank, and Bank Al- Habib have crossed the deposits mark of Rs. 1 trillion. These banks are the sixth and seventh banks in the banking industry that have achieved this milestone recently.
According to their financial reports, the deposits of the Meezan Bank stood at Rs. 1.09 trillion by end of the third quarter of 2020, while Bank Al Habib’s deposits stood at Rs. 1.08 trillion by the end of the same period.
The two banks are the emerging names in the banking industry, with consistent growth observed in their profits, assets base, deposits values, and branches for the last couple of years.
Previously Allied Bank Limited, United Bank Limited, Habib Bank Limited, National Bank Limited, and MCB Bank achieved this milestone during the last few years. These leading banks constitute around Rs. 10 trillion of the deposit value in the banking industry.
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According to the State Bank of Pakistan, the banking industry’s deposits have reached an all-time high of Rs. 17 trillion.
The deposits of the banking sector have registered healthy growth consistently despite low saving rates on various accounts and products offered by commercial banks.
In 2020, total deposits jumped 17 percent, registering the highest growth in four years. The deposits of the banking sector were expected to decline as people were assumed to utilize their savings during tough financial circumstances owing to the pandemic.
However, banking deposits grew in 2020 as people preferred to save their money due to sluggish economic activity in the country and worldwide.
The deposits of the banks witnessed tremendous growth in the last two months. This growth is due to the handsome inflows of remittances from overseas Pakistanis coming through Roshan Digital Accounts.
“It is expected that the deposits will grow in the range of 12-14 percent during 2021 due to next waves of COVID-19,” Topline Securities, a brokerage house, said in its report.
The two banks are in close competition with each other on various benchmarks.
Bank Al-Habib stood ahead of Meezan Bank with assets of Rs. 1.56 trillion, compared to Meezan Bank’s assets of Rs. 1.32 trillion.
Its branch network consists of 844 offices with 804 branches, 36 branches, and 4 representative offices in foreign countries. Meezan Bank is operating with a branch network of 802 across the country.
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Meezan Bank, being a leading Islamic Bank, led in terms of profitability. It made a handsome profit of Rs. 18 billion in the three quarters of 2020 compared with Bank Al- Habib, which recorded a profit of over Rs. 13 billion in the same period.
The deposits of Meezan Bank are slightly higher than Bank Al- Habib. The two banks are focusing on expanding their branch network, mainly in commercial areas of the big cities, and improving the quality of their services, including the incorporation of technology in their systems.
