For the best experience, open
https://m.greaterkashmir.com
on your mobile browser.

Growth in banks' credit surpassing deposits: RBI

02:36 AM Jan 28, 2024 IST | IANS
growth in banks  credit surpassing deposits  rbi
Advertisement

Mumbai, Jan 27: The gap between credit and deposit growth of banks as of the first fortnight of January 2024 has widened compared to the last fortnight of September 2023, according to the latest RBI data.

Advertisement
   

As on January 12, 2024, year-on-year credit and deposit growth stood at 19.93 per cent and 12.84 per cent respectively, which reflects a gap of 7.09 percentage points, RBI data on scheduled banks' statement of position in India shows.

Advertisement

According to the statement, during the reporting fortnight ended January 12, 2024, scheduled banks' credit outstanding increased by Rs 10,277 crore while deposits declined by Rs 98,848 crore.

"Healthier balance sheets have facilitated a broad-based expansion in lending by banks. Bank credit growth continues to outpace deposit growth on the back of sustained momentum of demand," the RBI said in its last Financial Stability Report (FSR).

Advertisement

The RBI noted that rising interest rates have benefited banks and improved their net interest margins (NIM), as the transmission to yield on assets has been faster than that to the cost of funds.

Advertisement

"Nevertheless, as the rate cycle approaches its peak, banks' profitability is expected to come under pressure due to rising valuation losses, increasing risks for asset quality and tempering of credit growth," the RBI said.

Advertisement

Advertisement
Advertisement