MUMBAI (Reuters) - Banks’ deposit advances and deposits grew at a slower pace in the first nine months of the financial year 2012-13 compared with a year earlier and are likely to fall short of the Reserve Bank of India’s projection by March-end.
So far this fiscal, banks’ advances grew 7.4 percent, compared with 10.5 percent a year earlier, while deposit growth was 7.3 percent compared with 11.3 percent in the same period a year ago, data from the Reserve Bank of India showed on Wednesday.
“I think credit growth is going to be much slower this year than what the RBI has projected because of cumulative slowdown in industrial and economic growth and, unless credit picks up, deposit growth is unlikely to grow,” said B. A. Prabhakar, chairman and managing director of the state-run Andhra Bank (ADBK.NS).
The Indian economy is headed for the weakest full-year growth in a decade, at about 5.5 percent, far below the near double-digit pace before the global economic downturn.
In its second-quarter review of the monetary policy, the RBI cut its credit and deposit growth projection by 1 percentage point each to 16 percent and 15 percent, respectively.
As of January 11, banks’ advances stood at 50,427.87 billion rupees, up 0.3 percent from two weeks ago, while deposits were up 0.9 percent at 65,385.95 billion rupees.
Reporting by Neha Dasgupta; Editing by Anupama Dwivedi