Deposits of commercial banks expanded by a robust Rs 62,750 crore while credit growth was relatively moderate at Rs 17,380 crore during the first fortnight of the January-March quarter, data from the Reserve Bank of India (RBI) shows.
This snaps the trend of credit growth outpacing deposit growth during the October-December 2012 period. During this period, deposit growth declined because of competitive returns being offered by other asset classes such as equities and gold.
Credit rating agency India Ratings said that refinancing (replenishing maturing deposits) risk has been rising, particularly for government banks, as long-term loans (infrastructure and residential mortgage) have increasingly been financed by short-term deposits (up to one year).
Asset-liability mismatches up to one year are at all-time high levels, and for a few banks, even higher than their stock of government securities.
It is learnt that gaps in the one-year funding profile has been widening in recent years for government banks.
Meanwhile, as on end-November 2012, credit to industry (micro and small, medium and large) and services sectors saw a slower year-on-year growth of 17.7 per cent (20.9 per cent) and 15.3 per cent (17.2 per cent) on a year-on-year basis.
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