Changes are visible in corporate credit growth: SBI

“Since the last two months since the festive season has ended, we have been witnessing an increase in the corporate cycle. The credit-deposit ratio of all the banks has started increasing. We have seen an improvement in the credit-deposit ratio to 4%. Retail credit growth continues to perform well.”

SBI is sitting on unavailable credit limit 5 trillion, he said. Corporates have started taking advantage of the limit, but most of the credit pick-up is due to increased government spending in the infrastructure sector.

“We have a good pipeline of investment proposals. This is coming from the fact that the government continues to spend money in infrastructure projects. This is affecting the core sector of the economy. Apart from the uptick in the commodity cycle, demand for iron and steel and cement has also seen good demand. This is one of the reasons why we are seeing pick-up in the untapped range,” he said.

Responding to the record high wholesale inflation of 14.23% in November, Khara said the number is tentative as supply-side constraints begin to ease.

Wholesale inflation based on the Wholesale Price Index rose to 14.23% in November from 12.54% year-on-year in October, mainly due to increase in food prices, especially of vegetables and minerals and petroleum products. This comes after the retail inflation print for November hit a three-month high of 4.91%, despite a cut in excise duty on fuel.

SBI had reported its highest quarterly net profit 7,627 crore at the end of September quarter on better asset quality and strong retail demand. There was a 6% increase in total assets driven by personal loans. The country’s largest lender expects its loan book to grow by 10% this fiscal.