Money & Banking

Banks' credit growth up 14.6% so far this fiscal

Our Bureau Mumbai | Updated on March 01, 2011 Published on March 01, 2011

banktable

Demand for loans from segments such as tourism, hotels and restaurants, non-banking finance companies, professional services, medium and large industries, vehicles and housing perked up banks' credit growth by 14.6 per cent in the financial year so far (March 26, 2010 to January 28, 2011), compared with 8.9 per cent in the corresponding period last year.

Within the services sector, loans given by banks to the tourism, hotels and restaurants segment jumped 45 per cent (or Rs 8,739 crore) in the reporting period, compared with 29 per cent (or Rs 3,979 crore) in the corresponding period last year, according to the latest Reserve Bank of India data on sectoral deployment of credit.

Loans to NBFCs such as gold loan companies and microfinance institutions rose 35.7 per cent (or Rs 40,521 crore), against 10.3 per cent (Rs 10,198 crore).

Loans to professional services, including doctors and chartered accountants, rose 33.4 per cent (or Rs 14,491 crore), against a decline of 2.2 per cent (- Rs 975 crore).

“There was a good demand for loans for setting up hotels in non-metro cities. Banks also gave loans to NBFCs such as gold loan companies and microfinance institutions due to the priority sector tag attached to such loans,” said a senior official with a public sector bank.

Credit growth to the commercial real-estate sector was 14.9 per cent (or Rs 13,756 crore) as against a decline of 4.4 per cent (or – Rs 4,080 crore).

In the case of transport operators, the credit growth was lower at 9.9 per cent (or Rs 5,178 crore) as against 17.8 per cent (or Rs 6,978 crore).

To industries

Loans to the medium and large industries grew by 24.8 per cent (1.1 per cent) and 19 per cent (17.7 per cent), respectively. In absolute terms, loans to the medium and large industries grew by Rs 32,921 crore (Rs 1,363 crore) and Rs 1,84,538 crore (Rs 1,35,427 crore), respectively.

Loans to the micro and small industries grew at a slower clip of 5.3 per cent (15.6 per cent). In absolute terms, loans to this segment grew by Rs 10,918 crore (Rs 26,434 crore).

Within the personal loans sector, loans given by banks to the vehicles segment jumped 22.1 per cent (or Rs 14,116 crore) in the reporting period, compared with a decline of 1.6 per cent (or - Rs 1,008 crore) in the corresponding period last year.

Credit growth to the housing segment was 12.1 per cent (or Rs 36,458 crore) as against an increase of 4.9 per cent (or Rs 13,690 crore).

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Published on March 01, 2011
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