RBI decision effect: Let us tell you that among the money raised by banks, the amount deposited in current and savings accounts is the low cost amount. Higher deposits in these accounts mean better margins for banks.
RBI decision effect: Even though the Central Reserve Bank has kept the repo rate stable for four times, the interest rate on loans is still high. Due to high interest rates, people are now emphasizing on fixed deposits instead of savings accounts. According to a survey report released by industry body FICCI and Indian Banks Association (IBA), there has been a decline in the amount deposited in current and savings accounts (CASA). Let us tell you that among the money raised by banks, the amount deposited in current and savings accounts is the low cost amount. Higher deposits in these accounts mean better margins for banks.
According to the 17th round of FICCI-IBA survey, in view of high interest rates, people are inclined towards fixed deposits (FD). In the current round of the survey, more than half of the participating banks (57 percent) reported a decline in the share of current and savings deposits in total deposits. At the same time, there has been a rise in FD.
NPA is improving
Regarding asset quality, the survey said, 75 per cent of banks have reported a decline in their non-performing assets (NPAs) levels in the last six months, compared to 90 per cent in the previous phase. In the survey report, 90 percent of public sector banks have cited reduction in NPA level, while 80 percent of private sector banks have cited decline in NPA. According to the survey, at the current stage about 54 percent of the banks feel that the gross NPA will remain between three-four percent in the next six months.
Increase in long term loans
According to the survey, an increase in credit flow is being seen in infra. In the survey, 67 percent of the participants have indicated an increase in long term loans, whereas in the previous round this figure was 57 percent. The survey said that the next six months may see an increase in debt in the non-food industry sector. About 42 percent of the respondents surveyed expect the growth in credit to the non-food industry to be more than 12 percent. Whereas in the last round, 36 percent had expressed this possibility.
We have taken all measures to ensure that the information provided in this article and on our social media platform is credible, verified and sourced from other Big media Houses. For any feedback or complaint, reach out to us at businessleaguein@gmail.com
