Banks meet ADR limit to avoid tax

KARACHI: The banks have nearly achieved a 50 per cent advance-to-deposit ratio (ADR) to avoid the incremental tax imposed by the government if they fail to meet the limit by the Dec 31 deadline.

Banks could not reduce deposits on a large scale but succeeded in increasing the advances by 27pc in just four months.

The banks encountered significant difficulties as when the tax was imposed in the FY25 budget, the policy rate stood at 22pc, and the average ADR was just above 38pc....