News posted by www.newsinfoline.com
While the demand for credit is clearly picking up, the growth in deposits isn't really keeping pace. Deposits with banks rose 14.34% y-o-y for the fortnight ended June 4, 2010, as against 14.16% y-o-y in the previous fortnight. Banks saw inflows of Rs 15,082 crore during the period under review. The rate of growth in deposits has been slackening; in the fortnight ended March 12 the growth had been much higher at 18.14% to Rs 44,02,943 crore. Banks do typically attempt to grow its balance sheets towards the end of the year.Despite this, the growth in deposits has been somewhat subdued. Reserve Bank of India (RBI) data shows that deposits rose by 14.16% to Rs 45,26,220 crore during the fortnight ended May 21. The system saw a reduction of Rs 4,997 crore during that same fortnight.The RBI has projected deposit growth at 18% for 2010-11. Industry sources point out that one reason for the rather muted growth in deposits is that companies have offered attractive interest rates for their deposits and savers have preferred to park surplus in corporate deposits.According to the bankers, with the demand for money going up, especially from telecom firms who bid for 3G and broadband licences, it's possible that deposit rates will need to be raised to attract customers.Although unwilling to give details, most of them believe deposit rates could go up by 25-75 basis points across different maturities. Union Bank of India executive director S Raman said, "Banks have so far not raised money aggressively since the demand for funds was also muted. With money having been lent to telecom firms who won 3G and broadband 3G and BWA, banks may now raise deposits to grow their loan books."
News posted by www.newsinfoline.com
Click here to read more news from www.newsinfoline.com
Please follow our blogs
newsinfolinephotogallery
prabugallery
newsinfolinephotogallery1
photogallery1
No comments:
Post a Comment