PNB sees robust growth in deposits in Q3FY25; CSB Bank logs over 20% growth

State-owned Punjab National Bank (PNB), in its quarterly update on Thursday, said domestic deposits have recorded a robust growth of 14.4 per cent year-on-year (Y-o-Y) during the October–December quarter (Q2FY25).

 

This growth is almost in tandem with its domestic loan portfolio, which grew 14.1 per cent during the same period.

 

Sequentially, however, advances grew a tad quicker than deposits for the Delhi-based lender. While deposits grew at 4.2 per cent sequentially, advances reported a 5 per cent growth.

 

At the end of the December quarter, PNB's domestic deposits totalled Rs 14.75 trillion, while its domestic advances reached Rs 10.61 trillion.

 

 

Overall, the bank's domestic business recorded a 14.3 per cent Y-o-Y growth and a 4.5 per cent sequential growth in Q3, totalling Rs 25.37 trillion.  Latest RBI data showed bank loans as well deposits grew 11.5 per cent year on year each till fortnight ended December 13, 2024.

 

Separately, Kerala-based CSB Bank reported a 22.17 per cent Y-o-Y growth in its deposit base for Q3, reaching Rs 33,406 crore. 

 

Its current account savings account (CASA) deposits grew by 6.6 per cent, while term deposits saw a 28 per cent rise. Sequentially, deposits of CSB Bank were up around 5 per cent over the previous quarter.

 

CSB Bank's advances outpaced its deposits in the reporting quarter, growing by 26.45 per cent to reach Rs 28,914 crore.

 

Notably, its gold loan portfolio saw a robust 36 per cent Y-o-Y growth.

 

Sequentially, the loan portfolio grew by 7.6 per cent, again outpacing the bank's sequential deposit growth.

 

Meanwhile, South Indian Bank saw its advances outpace deposit growth in Q3FY25.

 

The Kerala-based lender’s advances reported a 12 per cent growth to Rs 86,965 crore while its deposit base grew by just 6.28 per cent to Rs 1.05 trillion.

 

Sequentially, South Indian Bank’s advances reported a 2.65 per cent increase while its deposits, in fact, posted a marginal decline of 0.06 per cent over the previous quarter (Q2FY25), data shows.

 

Tamil Nadu-based Karur Vysya Bank, in its quarterly update earlier this week, reported a 14 per cent growth in advances, reaching Rs 82,842 crore. Its deposits grew 15.75 per cent, outpacing advances, to stand at Rs 99,155 crore.

 

Its overall business rose 14.93 per cent to Rs 1.82 trillion as of December 31, 2024, against Rs 1.58 trillion in the year-ago period.  Meanwhile Pune based state-owned lender Bank of Maharashtra reported a growth of 13.54 per cent YoY to Rs 2.79 trillion from Rs 2.46 trillion while its advances grew by 21.19 per cent, outpacing deposit growth, to Rs 2.28 trillion.  Its CASA Ratio dropped to 49.28 per cent from 50.19 per cent while the CD Ratio rose to 81.95 per cent from 76.78 per cent. Additionally, it’s total business grew 16.87 per cent YoY to Rs 5.07 trillion as on December 31, 2024 from Rs 4.34 trillion in the year ago period. 

 

According to the Reserve Bank of India’s (RBI’s) latest figures, system-wide credit growth accelerated in the fortnight ending December 13, rising by 11.5 per cent. Deposits also grew in tandem, registering a similar 11.5 per cent growth during the same period.

 

Credit growth in the economy, which had previously been driven primarily by retail credit, has tapered off from its peak.

 

This is following the RBI’s move, in November last year, to increase risk weights on unsecured loans and loans to non-banking financial companies (NBFCs).

 

Additionally, with emerging stress in unsecured segments such as credit cards, personal loans, and microfinance, most lenders have scaled back their credit growth targets for FY25.

 

Meanwhile, there has been a scramble for deposits by banks as household savings have been increasingly moving towards other investment avenues such as equities, mutual funds, pension funds and insurance, among others.

 

Credit growth was exceeding deposit growth until a few months ago.

 

It was in the fortnight ending October 18 that, after 30 months, deposit growth outpaced credit growth, which had come off its peak of last year.