Banks non-food credit growth jumps to 11-month high of 13.2% as on 03 April 2015

Banks extended loans worth Rs 2.66 trillion in the fortnight ended 03 April

The credit growth for Scheduled commercial banks' (SCBs) shot up to eight-month high of 12.6% to Rs 68309.65 billion as on 03 April 2015, showing sharp acceleration from 9.5% growth recorded a fortnight ago as on 20 March 2015.

Non-food credit, accounting for 99% of the share of the total credit, zoomed at 11-month high pace of 13.2% to Rs 67617.38 billion as on 03 April as against a rise of 9.8% a fortnight ago.

Banks have extended loans worth Rs 2.66 trillion in the fortnight ended 03 April 2015, compared with Rs 7.66 trillion worth of loans extended in last whole year.

The strong growth in advances in the fortnight ended 03 April 2015 relates to year-end or quarter end rush from the banks to meet the targets. Generally, these loans are rolled back in the early part of the new financial year or quarter, which leads to normalization of loans growth.

The overall credit-deposit ratio improved to 75.9% as on 03 April from 75.4% a fortnight ago and 75.6% a year ago.

Aggregate deposits of the scheduled banks galloped 12.8% to Rs 89114.84 billion as on 03 April 2015, compared with 11.4% growth a fortnight ago. The time deposits moved up 11.5% at Rs 79591.49 billion, while demand deposits zoomed 25% to Rs 9523.37 billion as on 03 April.

Banks' investment in government and other approved securities that qualify for treatment of statutory liquidity ratio (SLR) increased 12.4% to Rs 25482.2 billion as on 03 April over a year ago, showing deceleration in the pace of growth from 13.2% growth posted a fortnight ago.

The investment-deposit ratio eased to 28.6% as on 03 April from 29.2% a fortnight and 28.7% a year ago. The investment-deposit ratio remains much higher above the statutory liquidity ratio of 21.5%.

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