Covid-19 & Banking Sector’s Performance – A Case Of Pakistan

Abstract

Banking sector’s performance contain a numerous indicators to measure it, like: capital to asset, equity to asset, capital adequacy, non-performing loans (NPL), Cost to income, and loans to asset ratios, etc. Though, these indicators are not enough, but they are considered as a benchmark for the performance according to the bank-o-meter criteria. The aim of the current study is to see the pre and post-performance of the banking sector, and to devise some policy measures for the excellent performance. The main job of the banking area in a crisis like COVID-19 is to restore businesses and help them in monetary terms. So, this review not just assesses the monetary adequacy of the financial area of Pakistan yet, in addition, evaluates the capacity of the banking area to react to monetary tensions in the hours of an emergency. To see the performance of banks in covid-19, the bank-o-meter and S- score model has been utilized. The results recommend the financial area overall and banking sector are considerably in better monetary positions. And thus, they can fund the post-covid-19 restoration of organizations and businesses. However, they can perform much better by making some efficient policies too. Moreover, as per the experts around the globe, the most important drivers of the banking sectors include: solvency, liquidity, efficiency, profitability, and most importantly the policies regarding NPL, as NPL affects the overall profitability of the banking sector.