Credit, Deposit Growth Plunges

Credit and deposit growth came to a dramatic halt during the fortnight ending October 20, 2000, according to the weekly statistical supplement issued by the Reserve Bank of India (RBI) on Saturday.

The banking sector's deposits during the fortnight grew by Rs 4,189 crore, less than 70 per cent of the deposit growth of the previous fortnight at Rs 14,317 crore.

The scene was equally dramatic on the credit front. During the fortnight between October 6 and 20, total credit of all scheduled commercial banks grew by Rs Rs 4,021, over 50 per cent lower than the growth in the previous fortnight (Rs 8,631 crore).

 

The total deposits of the commercial bank stood at Rs 8,91,453 crore as on October 20.

The credit grew by Rs 4,021 crore to Rs 4,79,478 crore during the fortnight.

The fall in the credit growth was on account of the slide in the growth of non-food credit. Non-food credit grew only by Rs 3,061 crore in comparison to a growth of Rs 7,837 crore in the fortnight before. The food-credit, however, grew higher by Rs 961 crore in comparison to Rs 794 crore increase in the last fortnight.

Investments growth -- which had been lower in the current fiscal so far compared with the last fiscal -- went down further during the fortnight.

The investment went up only by Rs 114 crore to Rs 3,34,339 crore. The growth in the previous fortnight was Rs 843 crore.

Foreign currency reserves of the RBI had suffered a marginal decline of $10 million to $34.851 billion over the week ended on October 27.

The fall was entirely on account of the decline in the foreign currency assets of the central bank which went down to $32.009 billion as on October 27 compared with $32.019 billion as on October 20.

The weakening of rupee by around 40 paise against the greenback over the week prompted the RBI sell dollars that depleted its reserves.

Gold and special drawing reserves remained unchanged at the level of $2.834 billion and $8 billion, respectively.

The loans and advances to the government by the apex bank grew by Rs 944 crore over the week to Rs 8,935 crore. The loans and advances to the central government while came down by Rs 2,219 crore to Rs 3,822 crore , the advances to the state governments went up by Rs 1,275 crore to Rs 5,113 crore.

Net RBI credit to government fell by 2.1 per cent over the week to Rs 1,64,539 crore. This is in contrast to growth of 2.2 per cent in the week before.

The apex bank, however, has so far been be able to keep the monetary growth under control.

Money supply, on a year-on-year basis, grew by 14.7 per cent to Rs 12,09,866 crore till October 6 compared with a growth of 15.9 per cent growth over the corresponding period in the last year.