Private banks to report strong deposit growth in March quarter

Since the IL&FS defaults, it can be noted that NBFCs and housing finance companies (HFCs) were facing a crisis of confidence, sending call money rates higher and overall liquidity tight. (Since the IL&FS defaults, it can be noted that NBFCs and housing finance companies (HFCs) were facing a crisis of confidence, sending call money rates higher and overall liquidity tight.)
Since the IL&FS defaults, it can be noted that NBFCs and housing finance companies (HFCs) were facing a crisis of confidence, sending call money rates higher and overall liquidity tight. (Since the IL&FS defaults, it can be noted that NBFCs and housing finance companies (HFCs) were facing a crisis of confidence, sending call money rates higher and overall liquidity tight.)
Premium
 1 min read . Updated: 05 Apr 2021, 03:17 PM IST Shayan Ghosh

Mumbai: Private lenders in India are expected to report a strong inflow of deposits in the March quarter, going by initial numbers announced by three such banks.

On Monday, HDFC Bank, IndusInd Bank and Federal Bank reported some business numbers to the stock exchanges, including loans and deposits. All these numbers are subject to audits by statutory auditors of the three banks. India’s largest private sector lender HDFC Bank said its deposit base rose to about ₹13.35 trillion as on 31 March, registering a growth of around 16.3% on a year-on-year (y-o-y) basis.

TRENDING STORIESSee All

Federal Bank reported provisional total deposits of ₹1.72 trillion as on 31 March, up 13% from the same period last year. IndusInd Bank also reported a strong deposit growth of 27% y-o-y to ₹2.56 trillion at the end of the March quarter of FY21.

While banks are trying to build an improved deposit base, unrelenting retail inflation has ensured negative returns for savers. However, that has not let to the inflow of deposits retreating in any manner for the banking sector. As on 12 March, bank deposits stood at ₹149.55 trillion, up 12% from the same period last year.

“Most banks are focusing on garnering deposits (particularly current account and savings account and retail term deposit) to ramp up their liability franchises and reduce dependence on bulk deposits," Motilal Oswal said in a note on 31 March.

All three banks cited above reported a healthy growth in current account and savings account (Casa) deposits in Q4. While HDFC Bank’s low-cost Casa deposits grew 27% y-o-y to ₹6.15 trillion in Q4, Federal Bank’s Casa deposits expanded 26% y-o-y to ₹58,381 crore in the same period.

That apart, in terms of loans, two of the three banks reported growth surpassing industry levels. While HDFC Bank’s Q4 loans growth stood at 13.9% y-o-y, Federal Bank reported a loan growth of 9% y-o-y. However, IndusInd Bank’s net advances rose 3% y-o-y in the same period and was lower than the 6-6.5% being witnessed for the banking system at present.

Subscribe to Mint Newsletters
* Enter a valid email
* Thank you for subscribing to our newsletter.

Click here to read the Mint ePaperMint is now on Telegram. Join Mint channel in your Telegram and stay updated with the latest business news.

Close