Global Financial Crises Impact On Banking Sector Of Pakistan

Abstract

This research study is providing information about the global financial crises impact on the Pakistan banking sector. The State bank of Pakistan evaluated the financial structure of Pakistani banks after the global recession since 2007-2009. The banking sector of Pakistan is one of the largest contributors in the development of Pakistan economy. Different factors affect the Pakistan economy such as inflation, increased rate of unemployment and recession possibility in country.

Objective of the study is to find out the reasons of financial crises prevailing in Pakistan. • To determine the factors which contributing to these crises and these factors affect the banks directly or indirectly. • To find out the crises effect on the Pakistan and determine the banking position after the crises.

Global crises have no direct impact on the Pakistan banking sector mostly but we can't contradict the indirect impact of other factors on the banking sector. The other factors are telecom industry and FMCG (Fast moving consumer goods) etc.

The banks in consolidated position expect to play important and active role in financial growth and economic development of Pakistan. The consolidation occurs when some banks merge with other banks by which some banks become survival banks and some become acquired banks. The banks capture the assets and liabilities of those banks having weak performance or financial position.

For the study data collected through quantitative and qualitative approaches. For quantitative base data collection questioner has been distributed among bank employees while for qualitative base data collection interviews have been conducted with the senior employees of the banks.

Consolidation exercise affected the financial and economic position positively as well as negatively and changes the system. The crises discouraged the borrowers and lenders and fall down their morals. The banks vanished the confidence of lending and borrowing due to financial crisis.