Bank­ing spreads de­cline in July '14

The Financial Daily - - FRONT PAGE -

Ghu­lam Raza Ra­jani KARACHI: Bank­ing spreads wit­nessed a sharp MoM drop of 41bps in Jul'14 to 5.95 per cent; high­est dip in CY14TD. Although as­set yield inched down by mea­ger 4bps MoM to 11.06 per cent but a hefty in­crease in de­posit cost of 36bps to 5.11 per cent stretched down the over­all spreads which were at­trac­tive in Jun'14.

This is due to rise in de­posit rate to a costlier de­posit mix by bank­ing in­dus­try. It is per­ti­nent to note that dur­ing most part of CY14TD as­set yield re­mained stag­nant on ac­count of heavy in­vest­ment in gov't se­cu­ri­ties and spreads move mainly on ac­count of de­posit cost.

See # 4 Page 11 quite

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