MUMBAI Indian banks' credit to industry grew at a slower pace in December, compared with the year-ago period, the Reserve Bank of India (RBI) said on Thursday.
Credit to industry increased by 13.8 percent in December 2012 on a year-on-year basis, slower than a growth of 19.8 percent a year earlier, the central bank said in a statement.
"Deceleration in credit growth to industry was observed in all the major sub-sectors," the RBI said.
However, sectors including chemicals, food processing, rubber, plastic, petroleum, coal products and nuclear fuels, wood and leather did not see a slowdown in credit growth, it said.
On the other hand, credit to agriculture increased by 21.4 percent in December, up from a growth of 5.6 percent in the year-ago period.
So far this fiscal, banks' advances grew about 7.4 percent, compared with 10.5 percent a year earlier, while deposit growth was around 7.3 percent compared with 11.3 percent in the same period a year ago.
Concerns over rising non-performing assets in a slowing economy have turned banks cautious about lending to companies, while demand for credit from the industry has also softened.
Asia's economy is on track for its worst year in a decade and underscoring the urgency of politically difficult reforms to spur a revival.
Earlier in the week, the central bank cut its key repo rate and banks' cash reserve ratio by 25 basis points each, prompting some banks including top lender State Bank of India to lower lending rates.
(Reporting by Shamik Paul; Editing by Anand Basu)
Trending On Reuters
The Supreme Court has told the tobacco industry to adhere to rules requiring stringent health warnings on cigarette packs, but ordered a state high court to hear all pleas challenging the same. Full Article