Bank credit grew 3.2 per cent to Rs 107.05 lakh crore in the first nine months of the current financial year, against a growth of 2.7 per cent registered in the corresponding period of 2019-20. In the fortnight ended March 27, 2020, bank advances stood at Rs 103.72 lakh crore. Bank deposits rose 8.5 per cent to Rs 147.27 lakh crore in the April-December 2020 period as against an increase of 5.1 per cent a year ago, according to the recent data released by the Reserve Bank of India. The sharp accretion in deposits during the year was due to the safe haven appeal of banks.
In the fortnight ended January 1, 2021, the year-on-year growth in bank credit was 6.7 per cent and 11.5 per cent in deposits, the data showed.Lenders are being selective with their credit portfolios due to asset quality concerns, the rating agency said. According to the recent Financial Stability Report, under a baseline stress scenario, gross non-performing assets of all banks may rise to 13.5 per cent by September 2021, which would be the highest in over 22 years, from 7.5 per cent in September 2020.