MUMBAI: The pace of bank credit growth was 9.6% in FY12 from 5.6% in FY2011, even as deposit growth slowed to 8.9% from 11.4% in the previous fiscal period. A hike in lending by Rs 1.8 lakh crore in mid-March helped banks add Rs 10.4 lakh crore to their loan books in FY22. This is almost double the growth of Rs 5.8 lakh crore recorded in FY2011.
According to the data released by reserve Bank of India ,reserve Bank of India), total bank credit stood at Rs 118.9 lakh crore as on March 25 – last reporting Friday for FY22. This was an increase of Rs 1.8 lakh crore during the fortnight and Rs 10.4 lakh crore during the financial year, registering a year-on-year growth of 9.6%.
Deposits in the bank stood at Rs 164.7 lakh crore – an increase of Rs 1.9 lakh crore during the fortnight and Rs 13.5 lakh crore during FY22. The growth in bank deposits during the year was 8.9%.
Lending by retail lending continues to be driven. On the wholesale side, part of the increase is due to the move from money markets to credit as the central bank begins to withdraw excess liquidity. Also the boom in commodities like oil has increased the demand for working capital.
The recovery in credit was driven by private sector banks, which accounted for slightly more than half of the credit growth (50.4%), with public sector banks contributing 44.7%.
A research report by SBI said, “Interestingly, retail credit has emerged as the main driver of bank credit in recent years and is now the largest among all scheduled commercial banks’ outstanding credit displacing industrial loans. The share (30.5%) is (28.9%) in the retail sector, with the largest share of housing loans.”
according to this SBI Group chief economist Soumya Kanti GhoshThe importance of retail loans has increased for both private banks and public sector banks. Due to low profitability and deleveraging by corporates, banks shifted their focus from large infrastructure and industrial loans to retail loans.
According to the data released by reserve Bank of India ,reserve Bank of India), total bank credit stood at Rs 118.9 lakh crore as on March 25 – last reporting Friday for FY22. This was an increase of Rs 1.8 lakh crore during the fortnight and Rs 10.4 lakh crore during the financial year, registering a year-on-year growth of 9.6%.
Deposits in the bank stood at Rs 164.7 lakh crore – an increase of Rs 1.9 lakh crore during the fortnight and Rs 13.5 lakh crore during FY22. The growth in bank deposits during the year was 8.9%.
Lending by retail lending continues to be driven. On the wholesale side, part of the increase is due to the move from money markets to credit as the central bank begins to withdraw excess liquidity. Also the boom in commodities like oil has increased the demand for working capital.
The recovery in credit was driven by private sector banks, which accounted for slightly more than half of the credit growth (50.4%), with public sector banks contributing 44.7%.
A research report by SBI said, “Interestingly, retail credit has emerged as the main driver of bank credit in recent years and is now the largest among all scheduled commercial banks’ outstanding credit displacing industrial loans. The share (30.5%) is (28.9%) in the retail sector, with the largest share of housing loans.”
according to this SBI Group chief economist Soumya Kanti GhoshThe importance of retail loans has increased for both private banks and public sector banks. Due to low profitability and deleveraging by corporates, banks shifted their focus from large infrastructure and industrial loans to retail loans.