PACRA Maintains the Entity Ratings of The Bank of Punjab

The Bank of Punjab ("BOP" or the "Bank") has established a strong franchise, underscored by the strategic backing of its principal shareholder, the Government of Punjab (GoPb). This public-sector parentage has consistently provided institutional strength, policy alignment, and credibility, enabling the Bank to access high-impact and underserved market segments. The GoPb’s involvement not only reinforces public trust in the Bank but also facilitates its participation in development-focused initiatives across agriculture, SMEs, and financial inclusion. Over the years, BOP has made exceptional strides in the Small and Medium-sized Enterprises (SME) and agriculture sectors, positioning itself as a market leader. Its SME market share has doubled from 6% to 15.6% in less than three years. The Bank has further distinguished itself through targeted initiatives supporting small businesses, women entrepreneurs, and rural communities. Climate-related financing is another area of highlight. In line with this, the Bank has embraced digital transformation as a core strategic priority. It has achieved a 95.3% surge in digital transaction volumes since 2022, with 75% of all transactions now routed through digital channels. Innovative offerings such as SME e-Qarza, freelancer accounts, and government-backed initiatives like the Kissan and Livestock Cards underscore its commitment to financial inclusion and modern service delivery. The Bank has won a number of rewards and accolades. To sustain its momentum, BOP is actively exploring foreign funding opportunities while continuing to benefit from a stable and growing deposit base. During CY24, the deposit base of the Bank increased by 12.5% to stand at PKR 1,710.3bln (CY23: PKR 1,520.8bln). A significant contributor to this growth was 24.3% increase in current account deposits, which rose to PKR 354.1bln and now constitute 20.7% of total deposits (CY23: 18.7%). These deposits have more than doubled over the past three years. The Bank’s net advances have declined by 3.6% YoY to stand at PKR 777.4bln (CY23: PKR 806.4bln). Consequently, the Advance-to-Deposit Ratio (ADR) also declined to 45.4% (CY23: 53%), indicating a more conservative lending approach. Subsequent to the implementation of IFRS-9, Non-Performing Loans (NPLs) stood at PKR ~54bln (CY23: PKR ~51bln). The Profit After Tax increased by 17.9% to stand at PKR 13.4bln (CY23: PKR 11.3bln), attributable to enhanced non-markup income, which increased by 50.6% YoY and stood at PKR 26.7bln (CY23: PKR 17.7bln) with major contributions from FCY income, which increased by 188.6% YoY and fee & commission income by 53.1% YoY. The investment book inclined by 44.6% to PKR 1,320.9bln (CY23: PKR 913.2bln), mainly comprising government securities. In CY24, the Bank’ s equity base increased to PKR 92.5bln (CY23: PKR 80.8bln), while the Capital Adequacy Ratio (CAR) stood at 17.93 % (CY23: 18.37%).
The management, led by sound leadership, is poised to strengthen the profile of the Bank and is taking active measures to overcome the challenges. In this regard, the management is working on diversification in the revenue stream with a focus on tapping on SMEs, retail segments, and trade business of the country. Moreover, the Bank is planning to build global presence with the establishment of offshore entities.

About the Entity
The Bank of Punjab, established under the BOP Act 1989, is listed on the Pakistan Stock Exchange (PSX). As of end-Dec24, the Bank operates with a vast network of 900 branches (end-Dec23: 815 branches), mainly concentrated in Punjab. The Government of Punjab (GoPb) holds a majority stake in BOP (57. 5 %), whereas the rest is widely dispersed. The oversight of the bank is done under a Board of Directors (Board) comprising three non-executive directors and one executive director, the Chief Executive Officer (CEO). All four members are representing the GoPb. Mr. Zafar Masud, a renowned & experienced banker and currently Chairman of the Pakistan Banks Association, is the President & CEO of the Bank.