The Profitability of the Banking Sector of Pakistan

The main objective of the present study is to examine the determinants of the profitability of the banking sector in Pakistan. For this purpose we take the level of bank advances, the level of bank deposits, the difference between the rate of return on advances and the rate of return on deposits (often referred as ‘spread’), and the , liquidity ratio as the main indicators of the profitability of the banking sector.