The country’s largest private lender in terms of total advances, HDFC Bank, extended its lead over its closest rival ICICI Bank during the quarter ended March, according to data from Capitaline, reports Fe Bureau in Mumbai. HDFC Bank’s total advances at the end of the quarter stood at Rs5.54 lakh crore, 19.2% higher than ICICI’s Rs4.64 lakh crore. State Bank of India (SBI) continued to hold the largest share of the market, with Rs14.97 lakh crore in total advances, as on March 31. The advantage HDFC Bank has over most of its peers is its focus on retail borrowers, who have driven much of the growth in the system of late. Its advances grew 16.2% year-on-year (y-o-y) in Q4, while the outstanding non-food credit of the banking system at the end of March was about 9.6% higher than in the previous year.
Analysts believe the bank will find it a challenge to keep growing at rates so much higher than the system. “The key challenge going forward would be to maintain current loan growth if systemic credit growth continue to be anemic,” investment bank Jefferies wrote in an April 23 note on HDFC Bank. ICICI Bank, whose total advances at the end of Q4 were 6.6% higher than in the previous year, expects to perform better in FY18.
Chief executive Chanda Kochhar told reporters after the bank’s Q4 results, “Looking ahead for FY18, we expect domestic loan growth to be around 15-16%, driven by 18-20% growth in the retail segment and about 15-20% growth in the SME segment.” She gave no outlook for growth in corporate credit.