Banks have ended FY18 with credit growth outstripping deposit growth. In FY18, as per Reserve Bank of India data, credit growth was at ₹8,29,187 crore, while deposit growth was at ₹7,28,765 crore.

The incremental credit-deposit (C-D) ratio for FY18 works out to about 114 per cent. There was a slowdown in deposit accrual on account of other investment avenues such as mutual funds and stock market investments turning more attractive for the better part of the last financial year.

In the last fortnight of FY18, banks seem to have gone all out to disburse credit. Credit disbursed during the fortnight jumped by ₹2,79,361 crore. That is, almost 34 per cent of the credit in FY18 was disbursed in a single fortnight.

Similarly, banks mopped up deposits amounting to ₹3,18,451 crore in the reporting fortnight ended March 30, 2018. What this means is that close to 44 per cent of the deposits raised in FY18 came in the last fortnight.

The RBI, in its data on ‘Scheduled Banks’ Statement of Position in India’, said provisional figures have been incorporated in respect of such banks as they have not been able to submit final figures.

In FY17, the situation was the other way round, with deposit growth (on account of the scrapping of specified bank notes ) outpacing credit growth. The incremental C-D ratio in FY17 was about 32 per cent.

Related Topics