The Hindu Business Line : Bank credit up Rs 7,810 cr

THE gross bank credit in the system surged by Rs 7,810 crore to touch Rs 9,19,250 crore as on the fortnight ended September 17, 2004, according to the Weekly Statistical Supplement (WSS) of the Reserve Bank of India.

This is inclusive of food credit, which declined by Rs 1,667 crore to touch Rs 38,189 crore, and non-food credit, which rose by Rs 9,478 crore to touch Rs 8,81,061 crore.

There has been a significant pick-up in credit offtake in the current fiscal, as evidenced by various corporates going in for capacity expansions and enquiries coming in for working capital loans, according to bankers.

"There is also evidence that actual lendings are happening as one can see that the liquidity overhang in the system has shrunk to a large extent.

"The money in the repos has come down to Rs 19,000 crore where not so long ago, the liquidity was to the tune of Rs 50,000 crore," said an official with a public sector bank.

Meanwhile, according to the WSS, the total accommodation provided by scheduled commercial banks to the commercial sector in the form of bank credit and investments in shares, debentures, bonds, commercial paper, rose by Rs 72,585 crore to touch Rs 9,66,699 crore, for the fortnight ended September 17.

Loans and advances provided by the RBI to the State governments increased by Rs 140 crore during the week-ended September 24, to touch Rs 2,732 crore.

Year-on-year money supply was at 14.1 per cent.