Old Indian private banks losing market share: D&B

Old Indian private banks losing market share: D&B
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First Published: Wed, Mar 12 2008. 11 49 AM IST
Updated: Wed, Mar 12 2008. 11 49 AM IST
Mumbai: Old Indian private sector banks are fast losing their market share to new rivals and facing a slowdown in business growth, Dun & Bradstreet said in a report released late on Tuesday.
The deposits of old private sector banks grew by 6% during the year to March 2007 while advances grew by 12% during the same period, it said.
The industry average for the same was 25% for deposit growth and 31% for advances, it said.
The report covered 80 scheduled commercial banks including 23 private sector banks. Private players included older ones such as Federal Bank, South Indian Bank , Karur Vysya Bank and City Union Bank, among others.
The more aggressive new private banks included ICICI Bank , HDFC Bank , Axis Bank and Kotak Mahindra Bank.
Dun & Bradstreet also pointed out consolidation would be one of the key issues that might emerge in the Indian banking industry in the near term.
It also said Indian banking industry was considered too fragmented by global standards with the top 10 banks accounting for 65% of the banking assets and about 40 banks sharing 27% of the assets.
“Given the significance of scale in the global banking industry, too many banks sharing a low market share might lead to inefficiencies that could hinder sustained growth,” the report said.
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First Published: Wed, Mar 12 2008. 11 49 AM IST