In a first, the Investment-to-Deposit Ratio (IDR) in Pakistan has exceeded 100 percent, while the Advance-to-Deposit Ratio (ADR) has dropped to a historic low of 38.4 percent, according to the latest data released by the State Bank of Pakistan (SBP).

The IDR has reached 100.8 percent, a milestone driven by banks’ increased focus on government securities, as noted by Arif Habib Limited (AHL) in a brief review on Monday. This shift indicates a growing preference among banks to invest in government securities rather than extending loans.

Conversely, the ADR has fallen to 38.4 percent, reflecting banks’ cautious approach to lending amid a subdued demand environment characterized by high interest rates.

This decline suggests that banks are prioritizing safer investments over traditional lending, as businesses and consumers face challenges in borrowing due to the elevated cost of credit.