Karachi: According to the State Bank of Pakistan (SBP), the Non-performing loans of Banks and Developed Financial Institutions (DFIs) have reached to a record level of PKR 629 bn in the 3QCY11 as compared to PKR 591.226 in 2QCY11, witnessing an increase of 6.48% on QoQ basis owing to slow business activities caused by worst law and order situation, power and gas outages and interest rates still on the higher side.
According to Alfalah Securities, SBP also informed that the banking sector’s preference has shifted towards government papers from lending to the private sector due to surging non-repayment cases however, the amount of nonperforming loans have still remained high. The NPLs of Banks have reached to PKR 613.219 bn in the 3QCY12, showing an increase of PKR 37.371 bn against the NPLs of 2QCY11 while, the NPLs of DFIs have increased by PKR 958 mn to a level of PKR 16.336 bn in 3QCY11 against PKR 15.378 bn in the previous quarter. A major increase of PKR 26.299 bn was witnessed in the NPLs of public sector banks whose total amount has now increased to PKR 193.214 bn whereas, the NPLs of private banks, being the highest contributor to total NPLs has increased from PKR 368.561 bn in June 2011 to PKR 377.334 bn in September 2011. Furthermore, the figures of net NPLs to net loans depicted a rise of 1.05% QoQ as it has increased from 5.48% in 2QCY11 to 6.53% in the 3QCY11.