The share of public sector banks (PSBs) in total credit continued to decline and stood at 53.1 per cent in June 2024 (55.8 per cent a year ago) with concomitant rise for private sector banks (PvBs), per RBI’s quarterly BSR data.
That PvBs are steadily gaining market share in credit is underscored by the fact that their share in total credit has risen to 46.9 per cent in June 2024 from 36.5 per cent in March 2021.
On the deposits front, the share of deposits of scheduled commercial banks (SCBs), bearing 7 per cent and above interest rate, rose to 66.9 per cent in June 2024 from 45.4 per cent a year ago.
Further, consistent with rising return on term deposits, there has been higher accrual to this deposit category and share of savings deposits in total deposits has come down to 29.8 per cent in June 2024, from 30.1 per cent a quarter ago and 31.8 per cent a year ago, per the data.
Credit growth
Bank credit growth (year-on-year/yoy) slowed marginally to 15 per cent, net of merger (of HDFC with HDFC Bank), in June 2024 from 15.6 per cent in the previous year.
Growth in bank deposits (y-o-y) moderated to 11.7 per cent, net of merger (12.2 per cent including the impact of merger) in June 2024 from 13.1 per cent (13.7 per cent) a quarter ago.
The share of private corporate sector in total bank credit rose to 26.4 per cent (25.7 per cent a year ago) as loan growth accelerated in successive quarters, RBI said.
Individuals in the household sector accounted for 46.5 per cent of total credit; with the share of female individuals rising gradually and stood at 10.9 per cent of total loans in June 2024 (10.3 per cent a year ago).
Borrowings fell
“Bank borrowings by public sector entities both on sequential (q-o-q) as well as annual (y-o-y) basis and their share in total credit declined to 13.5 per cent in June 2024 (16.4 per cent a year ago).
“Bank credit to industry is gradually accelerating though the pace of expansion remains below the headline credit growth,” RBI said.
Metropolitan branches account for a bulk of bank loans; their share in total credit has, however, declined to 60.6 per cent in June 2024 from 62.0 per cent a year ago as urban and semi-urban branches recorded higher growth in bank loans.
The weighted average lending rate (WALR) increased marginally to 10.23 per cent in June 2024, from 10.18 per cent in previous quarter and 10.15 per cent a year ago.
