Lahore: The rating agency Moody’s on Monday stated that while the ongoing COVID-19 restrictions are seen to keep economic activity to pre-pandemic levels, the economy will experience modest growth of 1.5%, a news source reported. Moreover, the agency maintained stable outlook for the country’s banking sector on the back of reforms and policy effectiveness.
The report, titled ‘Banking System Outlook – Pakistan: Stable outlook balances loan book and profitability pressure against stable funding and a resilient sovereign’ covered the agency’s views on Pakistan’s banking sector.
The report added that Pakistan’s banking system reflected banks’ solid funding and liquidity, although a challenging operating environment would weigh on asset quality and profitability.
The report further said that the State Bank of Pakistan (SBP)’s policy to implement buffer against the impact of coronavirus pandemic will partially work and as a result the public sector lending will see a modest growth of about 5% to 7% during the going year.