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Deposits With Scheduled Banks Soar Rs 12545 Crore

The time deposits of scheduled commercial banks (SCBs) have witnessed a substantial growth in the last one month, with an inflow of Rs 12,545 crore into the system.

However, the demand deposits, which are a cheap source of funds for these banks, during the month have come down by Rs 3,840 crore.

During the fortnight ended July 27, the time deposits of SCBs rose by Rs 6,165 crore to Rs 8,79,341 crore, while the demand deposits fell by Rs 248 crore to Rs 1,42,438 crore.

Thus, the aggregate deposits during the period rose by Rs 5,917 crore to Rs 10,21,779 crore.

With safe investment avenues drying up for the retail investors, it is no wonder that the banking system is witnessing a healthy spurt in time deposits, analysts said.

They added that investors had become wary of stock market and mutual funds after the recent stock market scam.

The year-on-year growth -- during August 2000 to July 2001 -- in the aggregate deposits was 19.4 per cent at Rs 1,66,001 crore compared with 15.1 per cent growth recorded in the corresponding period of last fiscal (August 1999 to July 2000) at Rs 1,12,431 crore.

The non-food credit, a barometer of the economic activity, is inching up gradually. As per the data released by the Reserve Bank of India (RBI) for the fortnight ended July 27, the non-food credit rose by Rs 889 crore to Rs 4,73,157 crore during the fortnight compared with a growth of Rs 3,952 crore in the previous fortnight.

Though the banking system is awash with funds, growth in the credit is not picking up commensurably.

Therefore, banks are increasingly resorting to investments in government and other approved securities.

The investments by the SCBs, during the fortnight ended July 27, rose by Rs 3,923 crore to Rs 4,06,732 crore compared with Rs 8,684 crore in the previous fortnight.

Meanwhile, the foreign exchange reserves of the country, during the week ended August 3, increased by $ 127 million to $ 43.809 billion compared with $ 78 million growth in the previous week.

The growth in the forex reserves during the week was solely due an accretion of $154 million to the foreign currency assets of the country.

The assets, as on August 3, stood at $ 41.029 billion.

However, the gold reserves fell by $ 27 million during the week to $ 2.771 billion. The special drawing rights remained unchanged at $ 9 million.

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First Published: Mon, August 13 2001. 00:00 IST
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