The non-food credit grew 13.8% year-on-year for the fortnight ended July 1, according to data released by the Reserve Bank of India (RBI), sustaining the double-digit growth for three fortnights in a row. The non-food credit has clocked more than 10% growth in each fortnight of the first quarter of the current financial year, except for the one ended May 20.
Outstanding non-food credit as on July 1 stood at Rs 120.99 trillion, higher than Rs 108.45 trillion in the same fortnight a year ago. Deposit growth, which had moderated in the previous fortnight ended June 17, witnessed a growth of 9.77% YoY to Rs 169.6 trillion.
Among the recently reported loan growth data by some private banks for Q1FY23, HDFC Bank posted a 21.5% YoY growth in advances to Rs 13.95 trillion as on June 30, 2022. Federal Bank, IndusInd Bank, CSB Bank and AU Small Finance Bank also reported double-digit loan growth during the quarter.
Top private sector lenders such as ICICI Bank, HDFC Bank and Axis Bank maintained strong mortgage disbursements, brokerage Emkay Global Financial Services said in a report. Armed with cost advantage and improved turnaround time, banks have gained market share in home loans. State Bank of India and other public sector banks are also trying to bolster home loans, it said. Although overall credit growth remains healthy, led by retail, analysts believe that large private banks will be better placed to capture the momentum due to better technology.
On the corporate side, companies are ready to borrow from banks after undergoing deleveraging over the past few years, as recovery in economic activity and increased investments and consumption may sustain the momentum, ICICI Securities had said earlier.
Although the first quarter witnessed a robust growth in credit, analysts at Kotak Institutional Equities said the growth has not been evenly spread out across segments.