LDR Dips

EghtesadOnline: The loan to deposit ratio (LDR) declined for nine months to December 22 by 82.4%, which was 0.3 percentage points lower than the beginning of the fiscal year last March at 83%, the Central Bank of Iran reported on its website.

News ID: ۷۵۲۱۹۵

18 January 2023

The loan to deposit ratio (LDR) declined for nine months to December 22 by 82.4%, which was 0.3 percentage points lower than the beginning of the fiscal year last March at 83%, the Central Bank of Iran reported on its website.

The ratio was 1 percentage points higher from the same period last year. LDR is used to assess a bank's liquidity by comparing the total loans to total deposits for a specific period and is expressed in percentage.

If the ratio is too high, the bank may not have enough liquidity to cover unforeseen fund requirements. Conversely, if the ratio is too low, the bank may not be earning as much as it should be.

The CBI, however, noted that the LDR was not consistent across provinces. In Tehran Province it was 91.4% and in Kohgilouyeh-Boyerahmad Province 110.9