This paper examines the relationship of loan loss provisions with the capital and earnings management in the banking sector of Pakistan. The study applies the Clustered Robust Linear Regression while examining the panel models when the data had heteroscedasticity and autocorrelation in it. This regression is used to remove the effects of these disturbances from the dataset. The study targets 25 banks (Islamic and commercial banks) from the banking sector of Pakistan. Descriptive analysis showed that the banks are engaged in the use of loan loss provisions for their capital and earnings management practices. The results of Clustered Robust Linear Regression showed a significant relationship of Tier1 and EBTLLP on the dependent variable LLP. This significant relationship depicts the strong influence of loan loss provisions (LLPs) on the capital and earnings management of the banks in Pakistan. In further research perspective, the time duration of the study can be extended, and more variables can be added. It can also include a comparative study amongst different banks in Pakistan.