SBP sees banking sector's performance satisfactory.

KARACHI -- State Bank of Pakistan (SBP) has issued the Mid-Year Performance Review (MPR) of the Banking Sector for the year 2020. The review comprehensively covers the performance and soundness of the banking sector for the period January to June 2020 (H1CY20). According to SBP statement issued on Wednesday, the review suggests that-despite elevated economic stress driven by the COVID-19 pandemic-the assets of the banking sector witnessed a decent expansion of 7.8 percent during H1CY20. Robust increase in investments, funded by surge in deposits, explains this growth. Advances, on

the contrary, observed mild downtick owing to the economic slackness caused by the disruption inthe business activities after the outbreak. Sans SBP supportive measures, though, the contraction in advances could have been much higher. The review also highlighted that the policy measures rolled out by SBP facilitatedthe banking sector in conserving the capital, enhancing the lending capacity and increasing the loss absorption ability. As a result,despite some increase in credit risk,banking sector demonstrated improved profitability and enhanced resilience.The Non-performing loans (NPLs) ratio increased from 8.6 percent as of end December...