Karachi: Meezan Bank, Pakistan’s largest Islamic bank, held its 2025 Corporate Briefing Session, during which the management discussed its financial performance and future outlook. The bank projected an increase in the policy rate by 100-150 basis points in the upcoming monetary policy meeting, marking a shift from its earlier expectation of the rate bottoming at 10%, a stance altered by the current geopolitical situation.
According to JS Global, Meezan Bank has received approval from its Shariah board to launch credit cards, which are anticipated to be rolled out by 2027. The bank’s deposit growth was strong, with a 28% year-over-year increase, reaching Rs3.3 trillion by the end of 2025. The current account ratio was maintained at 48%, with CASA deposits increasing by 25% year-over-year, achieving a CASA mix of 91% in December 2025, compared to 93% in the previous year. Term deposits rose by 59% year-over-year, attributed to low base amid ADR-related taxation in 2024 and the replacement of high-cost State Bank borrowings.
Meezan Bank’s market share in total industry deposits remained at 9%, with a compound annual growth rate in deposits of 33% since its inception. The management expects the bank’s deposit growth to remain between 20%-25% in 2026, with the same current account and CASA mix targets. The bank expanded its branch network by opening 54 new branches in 2025, bringing the total to 1,105, and plans to open 100-150 additional branches in the coming year.
The bank’s investment portfolio comprises 83% in Government of Pakistan Ijarah Sukuk (GIS), with 73% invested in variable GIS. Fixed GIS yields 11.5% with a maturity of 1.6 years. The cost-to-income ratio rose to 30.4% in 2025, compared to 26.8% in 2024, but the management expects this to remain between 35%-40% in 2026. The capital adequacy ratio stood at 19.20% in December 2025, down from 20.35% the previous year.
Trade business volume increased by 8% in 2025, reaching a total trade value of Rs2.9 trillion, with exports contributing 38% of the total. Despite these developments, the bank plans to maintain a Rs7 per share quarterly dividend throughout the year. The bank’s shares are currently trading at a 2026 estimated price-to-earnings ratio of 9.5x and a price-to-book value of 2.6x, with a dividend yield of 6%.