Base effect lifts credit growth to 10.65 pc in December

Mumbai, Jan 7 (PTI) Credit growth after a long gapgrew in double digits to 10.65 per cent at Rs 80,96,727 crorein the fortnight ended December 22, 2017 due to the baseeffect, according to the RBI data.The advances had stood at Rs 73,17,391 crore in thefortnight ended December 23, 2016."The credit growth is mainly because of the baseeffect. Due to the demonetisation last year, the base figuresare getting revised and so that is where you are seeing thegrowth," State Bank of India's managing director (retail anddigital banking) P K Gutpa said.He said there is a revival in demand for retail creditbut corporate credit continues to be muted."We are seeing revival of demand on the retail front.In December, we had record auto loans booked by us. Similarly,we saw a higher number of housing loans booked by us duringthe month," Gupta said.The recently released Financial Stability Reportshowed that the credit growth of scheduled commercial banks,on a y-o-y basis, increased from 4.4 per cent to 6.2 per centbetween March and September 2017.The public sector banks' credit growth increased from0.7 per cent to 2.2 per cent during the same period reversingthe declining trend observed during the past two years.The growth in credit in the reporting period wasslightly higher than the previous fortnight ended December 8,2017.In the previous fortnight, the banks' advances hadgrown by 9.77 per cent to Rs 80,26,901 crore from Rs 73,12,107crore in the year ago period.In the reporting fortnight, banks' deposits had risenby 3.96 per cent to Rs 108,85,118 crore as against Rs104,69,807 crore in the period ended December 23, 2016, thedata showed.Deposits in the previous fortnight ended December 8,2017 had grown by 3.32 per cent to Rs 109,01,613 crore asagainst Rs 105,50,392 crore in the period ended December 9,2016.The FSR had said deposit growth of scheduledcommercial banks, on a y-o-y basis, decelerated from 11.1 percent to 7.8 per cent between March and September 2017.The decline in deposit growth is observed across all bank groups, the report said.

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