Bank loan growth improves to 14-month of 11% as on 11 December

Credit-deposit ratio improved to nine months high of 75.8%

The credit growth for Scheduled commercial banks' (SCBs) improved to 14-months high of 11.1% at Rs 69661.06 billion as on 11 December 2015 over a year earlier, showing pick up from 9.8% growth in November 2015. The loan growth has also accelerated from 10.1% increase in December 2014. The banking sector credit has moved up after hovering in a narrow range of 9-10% for last twelve straight months.

Non-food credit, accounting for 98.4% of the share of the total credit, improved 11.1% to Rs 68567.17 billion as on 11 December 2015 as against a rise of 10.3% a year ago. The overall credit-deposit ratio improved to nine months high of 75.8% as on 11 December 2015 from 75.3% at end November 2015, while it remained lower from 76.3% in December 2014.

Aggregate deposits

Aggregate deposits growth of the scheduled banks increased 11.5% to Rs 91849.6 billion as on 11 December, compared with 10.4% increase in November 2015, while growth also exhibited increase from 10.8% rise in December 2014. The deposits growth continued to hover in the range of 11-13% for last 20 months. The time deposits moved up 11.1% at Rs 83472.64 billion, while demand deposits increased 15.1% to Rs 8376.93 billion as on 11 December 2015 over a year ago.

Investments of the banking sector

Banks' investment in government and other approved securities that qualify for treatment of statutory liquidity ratio (SLR) increased 12.3% to Rs 27444.92 billion as on 11 December 2015 over a year ago, showing an improved pace of growth compared with 9.9% growth in December 2014. The investment-deposit ratio rose to 29.9% as on 11 December 2015, compared with 29.3% a year ago. The investment-deposit ratio remains much higher above the statutory liquidity ratio of 21.5%.

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