Bank of Baroda, a state-owned bank, in its quarterly update on Friday said its domestic deposits grew 9.23 per cent year-on-year (Y-o-Y) in October-December (Q3FY25) at Rs 11.65 trillion, while advances increased 11.76 per cent Y-o-Y at Rs 9.63 trillion, outpacing deposit growth during the period. Domestic retail advances grew at a robust 19.5 per cent Y-o-Y to Rs 2.43 trillion.
For the time being, digital lending remains a grey area, notes Tamal Bandyopadhyay.
Axis Bank on Wednesday said it has completed the acquisition of Citibank's retail business in India for a final cash consideration of Rs 11,603 crore. The sale excludes Citi's institutional client businesses in India. The third-largest private sector bank said the acquisition, announced first in March last year, will not necessitate any new capital requirements and stressed that the attrition numbers on customers are much better than expected.
Bank credit growth is expected to moderate this financial year after a robust 16 per cent estimated for last financial year, driven by strong economic activity and retail credit demand. There are three reasons for this: a statistical high-base effect given the strong growth seen last financial year, revision in risk weights by the Reserve Bank of India (RBI), and relatively slower economic activity.
With rising credit demand, cleaner balance sheets, and renewed investor confidence, banks are positioned at the forefront of the market rally. From major players like ICICI and HDFC to broader policy shifts, there's much driving this momentum.
With rising credit demand, cleaner balance sheets, and renewed investor confidence, banks are positioned at the forefront of the market rally. From major players like ICICI and HDFC to broader policy shifts, there's much driving this momentum.
With rising credit demand, cleaner balance sheets, and renewed investor confidence, banks are positioned at the forefront of the market rally. From major players like ICICI and HDFC to broader policy shifts, there's much driving this momentum.
The initial public offering (IPO) lane will be busy next week, with four main-line companies, including Leela Palaces Hotels & Resorts operator Schloss Bangalore Ltd and Aegis Vopak Terminals tapping the primary market to raise over Rs 6,600 crore collectively.
Privately, many bankers admit their immediate goal is not growth but slowing the erosion of Casa deposits, reveals Tamal Bandyopadhyay.
In 2025 banks are in for challenges such as pressure on margins and slowing credit growth. With the likelihood of a repo rate cut in February or April, external benchmark-linked loans of banks will be repriced immediately. However, deposit rates are expected to adjust more gradually, which could impact the net interest margin (NIM) - a key measure of profitability for banks.
'We plan to launch new initiatives, including cash flow-based lending, to ensure borrowers are not burdened and can access funds more quickly.'
ICICI Bank will offer car loans at 13-13.25 per cent on a floating basis. HDFC will offer home loans at 10.50 per cent and SBI is also expected to cut retail interest rates.
Credit outstanding to the housing sector rose by nearly Rs 10 lakh crore in the last two fiscals to reach a record Rs 27.23 lakh crore in March this year, according to RBI's data on 'Sectoral Deployment of Bank Credit'. Experts from banking and real estate sectors attributed this growth in housing credit outstanding to a strong revival in the residential property market post-COVID pandemic on pent-up demand. According to the data of the Reserve Bank of India (RBI) on sectoral deployment of bank credit for March 2024, the credit outstanding to the housing (including priority sector housing') stood at Rs 27,22,720 crore in March 2024, up from Rs 19,88,532 crore in March 2023, and Rs 17,26,697 crore in March 2022.
When Gensol Engineering made its public market debut through a small and medium enterprises (SME) initial public offering (IPO) in September 2019, its promoters held a commanding 96 per cent stake. Now, that figure has shrunk to a "negligible" fraction.
'There has been a change in the advances mix, with the share of corporate loans decreasing.'
JM Financial on Wednesday said it had a "careful and detailed review" of the Reserve Bank's order imposing restrictions on the company's financing business and asserted that there was "no material deficiencies" in its loan sanctioning process. The Reserve Bank on Tuesday imposed restrictions on JM Financial Products Ltd after it found the company indulged in various manipulations, including repeatedly helping a group of its customers to bid for various IPOs (initial public offerings) by using loaned funds. "After careful and detailed review of the order issued by the RBI on the action against JM Financial Products Ltd, we strongly believe that there have been no material deficiencies in our loan sanctioning process.
Personal loans and credit card loans provide quick access to money when it is urgently needed, but they also carry risks for borrowers.
Weak market sentiment has driven a steady decline in cash market volumes and margin trading books over the past nine months. Cash market volumes have plummeted by 45 per cent from their peak in June 2024, while the margin book - used by traders to leverage stock purchases - has shrunk by 16 per cent since its high in September 2024.
'We tightened our risk frameworks once the Covid crisis started.' 'We are slowly lightening this as we see economic activity pick up, salaries getting restored, and people getting back into jobs.'
Kotak Mahindra Bank's loan and deposit growth are likely to be affected after the Reserve Bank of India (RBI) asked the private-sector lender not to take on board new customers through the bank's online and mobile banking channels and not to issue any new credit cards, according to analysts. The bank's share price fell 10.85 per cent on Thursday to close the day at Rs 1,643 on the BSE. The RBI's action came after market hours on Wednesday.
India's financial sector is dominated by large government-owned and private-sector banks.
Analysts have largely maintained their positive outlook on HDFC Bank, as the private lender reported in-line results for the October-December quarter (Q3) of the current financial year (2024-25/FY25). They believe the results were 'strong' given the tough macro environment, and relative to peers.
Consumer durables retailers and manufacturers may end up bearing the cost of the Reserve Bank of India's (RBI's) tightening on easy personal loans, as their margins are expected to be impacted by higher borrowing costs. During the recently passed festival season, consumer durables companies started offering longer tenure loans, zero down payments, and zero interest on a wider assortment of products than ever before, making the products more affordable. While 18- and 24-month easy monthly instalment (EMI) options were available earlier, companies offered them only on select products; now, they are being extended to a larger section of products.
A day after the Reserve Bank of India's (RBI's) Monetary Policy Committee hiked the policy repo rate by 50 basis points (bps), several commercial banks, including ICICI Bank and Bank of Baroda, raised their external benchmark-linked loan rates by an equal amount on Thursday. HDFC, the country's largest mortgage lender, too, increased its interest rates on housing loans by another 50 bps. In total, it has raised rates by 85 bps since May 4, when the RBI had increased the repo rate by 40 bps in an off-cycle meeting.
'Common sense says if one can afford, servicing the loans during this period is a better bet than postponing it by three months,' says Tamal Bandyopadhyay.
Defying the bearish sentiment in the markets on Monday, ICICI Bank's share price rose by 2 per cent, reaching an intraday high of Rs 1,234.4 per share on the BSE. With a 1.5 per cent gain at the close, the stock emerged as the top performer on both the BSE Sensex and the National Stock Exchange Nifty 50 indices.
'I believe that the overall demand for commercial vehicles will improve, even though there is a slowdown in the GDP.'
Defying trends, the country's largest private sector lender, HDFC Bank, has shifted its asset mix significantly towards high-rated segments. As a result, its wholesale-to-retail mix has tilted heavily in favour of wholesale, even at the cost of margins. Further, it is even looking to ramp up its branch network, with an aim to service clients within a 1-2 km radius rather than the current 5-6 km radius.
Brokerages expect a further slowdown in Indian firms' revenue and earnings growth in Q4FY25, following low single-digit growth in the preceding three quarters, as factors like weak consumer demand and credit growth linger on.
ICICI Bank has extended its festive offer of low interest rates on retail loans in order to meet its target of 20 per cent retail credit growth in 2007-08, down from around 40 per cent growth recorded in the past two years.
'The real repo rate is very high in terms of core inflation.'
The difference between Cibil and other marketplaces is that in the case of the latter the credit report is accessed after the customer clicks the loan offer, while in the case of Cibil the customer first checks the credit score and then applies for the loan.
'In the case of corporate credit, especially to AAA borrowers, lenders will have to take a fresh look at pricing.'
ICICI Bank share price hits record high, ICICI Bank m-cap tops $100 billion: Shares of ICICI Bank have been on a steady uptrend, rising 30 per cent over the past one year; not far behind Axis Bank stock that surged over 34 per cent during the period. The BSE Sensex, meanwhile, is up 25 per cent, and the BSE BANKEX 22 per cent in the last one year, ACE Equity data shows. On Wednesday, June 26, ICICI Bank shares hit a fresh record high for the third consecutive day, rising 2 per cent on the BSE in the intraday trade.
The Reserve Bank India's (RBI's) decision to ban the onboarding of new accounts on the "bob World" mobile digital platform led to a selloff in the Bank of Baroda (BoB) stock. The stock of the public sector bank dropped by around 3 per cent. The central bank cited "material supervisory concerns"; news reports claimed mobile numbers were randomly linked to accounts to purportedly inflate registrations on bob World.
Credit card spending reached Rs 2 trillion in October, a 14.5 per cent rise from September, largely driven by festival season purchases. However, the volume of outstanding credit cards increased only marginally during the same period. The spike in spending comes at a time when nearly all major credit card issuers are calibrating their growth in the segment due to visible signs of stress.
'The last year's growth is a foretaste of things to come in the retail credit market.'
Auto mobile retail sales in India witnessed a 10 per cent annual growth in July driven by robust sales across passenger vehicles, two-wheelers and commercial vehicles, industry body FADA said on Monday. Total retail sales across segments rose to 17,70,181 units last month, as compared to 16,09,217 units in July 2022. Passenger vehicle sales saw an increase of 4 per cent to 284,064 units last month, as compared to 273,055 units in the year-ago period, the Federation of Automobile Dealers Associations (FADA) said in a statement.
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