Credit growth likely to pick-up by end Q2 FY11: Nair

Credit growth, which stood at 16.6 per cent last fiscal, is likely to pick-up by the end of the second quarter of this fiscal, a top banking industry official said.

"Credit off-take saw a 16 per cent growth year-on-year. However, it has declined post-March this year and the trend continues. It will start picking up in the next quarter," Union Bank of India's Chairman and Managing Director and Indian Banks' Association's (IBA) Chairman, M V Nair, told reporters on the sidelines of an IBA event here. 

Nair had earlier said that credit and deposit growth for the industry might go upto 20 per cent by the end of this fiscal. He had further said that credit growth for his bank (Union Bank) might be ahead of the industry level at 25 per cent.

On lending rates, Nair said that they were likely to remain stable for the moment. "There is no need to raise rates at this point as there is enough liquidity in the system," Nair said.

Union Bank does not plan to come out with any teaser rates which are very low interest rates offered for a limited introductory period to attract new borrowers, at this time.

Asked about rising concerns on the huge overseas capital inflows, Nair said that it should not pose a problem provided the inflows are managed properly.