State Bank of India is eyeing a 15-20 per cent increase in deposits this fiscal, it’s Chairman Pratip Chaudhuri said.
This targeted growth rate is higher than the Reserve Bank of India’s deposit growth projection of 14 per cent for the entire banking system this fiscal. It is also higher than the 14.85 per cent increase in deposits achieved by SBI in 2012-13. Deposits in the banking system had recorded 13 per cent growth last fiscal.
Deposits growth in the banking system has slowed in the recent years largely due to households looking at alternate assets such as gold, mutual funds, equities and real estate to tackle their inflation worries.
Chaudhuri admitted that deposit growth had slowed down for the country’s largest commercial bank during 2012-13. Part of the reason is the absence of a level playing field with mutual funds.
While corporates flush with funds park their surplus in liquid funds that could be redeemed at short notice, the highly regulated banking system is not able to offer any product with a maturity period of less than seven days.
The RBI does not see any merit in reducing the minimum maturity period to, say, three days from the current seven days.
The public sector bank’s advances portfolio grew 21 per cent in 2012-13. This was higher than the 14 per cent loan growth seen in the banking system. Chaudhuri said the bank would, in the next few days, decide on the loan growth target for the current fiscal.
On the latest Cobrapost expose, SBI plans to complete its internal inquiry in a month’s time, a senior bank official said.
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Published on May 7, 2013
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