Indian banks' loans rose 10.4 pct in two weeks to Sept. 30, says RBI

The Reserve Bank of India (RBI) in its weekly statistical supplement released on Friday noted that Indian banks' loans rose 10.4 percent in two weeks to September 30 from a year earlier.

The report also stated that deposits rose 11.3 percent. Outstanding loans rose 2.11 trillion rupees (USD31.56 billion) to 75.21 trillion rupees in the two weeks to September 30.

Non-food credit rose 2.21 trillion rupees to 74.35 trillion rupees, while food credit fell 105.30 billion rupees to 854.60 billion rupees. Bank deposits rose 3.52 trillion rupees to 101.43 trillion rupees in the two weeks to September 30.

The RBI seems to have started digging into the country's foreign exchange reserves to ease the pressure on rupee with dollars flowing out of the system amid redemption of FCNR-B (foreign currency non-resident-bank) deposits.

The reserves were at USD 367.647 billion at end of October 7 as reported by the RBI. The central bank does not cite any reason for the reserves movement.

India's foreign currency assets, which is 93 percent of forex reserves, fell USD 4.317 billion to USD 342.394 billion reflecting the sharp fall in valuation of the forex held in pound sterling, dealers said. Last week, the British currency fell to its lowest level since 1985.

India holds reserves in dollar and other major foreign currencies such as pound, euro and Japanese yen.