Home / Industry / Banking /  Banks close FY19 with 13.24% credit growth, deposits up 10.03%

NEW DELHI : Banks closed fiscal 2019 with robust disbursals that rose in double-digits for the second year in row, after the sub-5 % in FY17, which was the lowest in five decades.

According to the Reserve Bank data released Thursday, bank credit rose 13.24 % to 97.67 lakh crore for the fortnight to March 29, while deposits grew by 10.03 % to 125.72 lakh crore during the same period.

This is the second consecutive double-digits credit growth after the same had declined to 4.54 % in FY17 at 78.41 lakh crore, which was the lowest since 1963.

In the year-ago fortnight, deposits were at 114.26 lakh crore and advances at 86.25 lakh crore, according to the RBI data.

In FY17, aggregate deposits in the banking system grew a mere 6.7 % in 2017-18, while credit grew still lower at 4.54 %, the lowest since fiscal 1963.

Bank deposit growth fell to a five-decade low in year to March 2017 as demonetisation bonanza withered.

It can be noted that during November-December 2016, banks received a whopping 15.28 lakh crore as people deposited high denomination currency notes that were withdrawn from circulation on November 8. As a result, aggregate deposits in the fiscal ended March 2017 grew 15.8 % to 108 lakh crore.

In the previous fortnight to March 15, 2019 credit demand had grown by 14.46 per cent to 95.53 lakh crore while deposits increased by 10.03 per cent to 122.26 lakh crore, show RBI data.

On a year-on-year basis, non-food bank credit increased by 13.2 % in February 2019 as compared with an increase of 9.8 % in the year-ago period.

Loans to the services sector almost doubled with a 23.7 % growth in February compared to 14.2 % in the same month last year.

Advances to agriculture and allied activities increased by 7.5 % in February compared to an increase of 9 % in February 2018.

Credit to the industry rose by 5.6 % in February, up from an increase of 1 % in February 2018.

Credit to the infrastructure, chemical and chemical products, and all engineering sectors accelerated. However, credit growth to basic metal & metal products, textiles, and food processing decelerated/contracted.

Personal loans rose 16.7 % in February down from 20.4 % in February 2018.

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