Banks will need $100 bn in 10 years, says O P Bhatt

Banks in India will need about $100 billion (Rs 5 lakh crore) of capital over the next decade as the system grows to meet credit requirements of an expanding economy, Om Prakash Bhatt, chairman of the State Bank of India said here today.

“I see a huge amount of growth across sectors and geographies, driven mainly by younger people,’’ Bhatt said at a three-day conference organised by the Indian Banks’ Association and the Federation of Indian Chambers of Commerce & Industry.

The head of the nation’s biggest bank said there was a huge requirement for capital. Urban infrastructure alone would require $1 trillion in five years. Home loans, the fastest growing segment in the banking sector, could top $1 trillion over the next decade, Bhatt said. India would have to build a banking structure bigger than what we have today, he told the gathering.

The number of hits in automatic teller machines remained unchanged even after SBI doubled their number, evidence of the need for more financial services. The need for bank branches could grow as much as four times, as more people used banking services, he said.