In a statement, the central bank said that all banks and financial institutions will remain closed for public dealings on the first day of the new year.
The development finance institutions (DFIs) and micro finance banks (MFBs) will also remain shut on January 1.
However, the SBP clarified that all employees of the banks, DFIs and MFBs will attend their offices as usual on the bank holiday.
The bank holiday allows commercial banks to complete year-end processes and ensure a smooth transition into the new financial year.