Indian Banking – Sector data update (data as of 23 September 2011) ::RBS,

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Deposits increased Rs82bn during the fortnight ended 23 September 2011 (Rs129bn growth in
the previous fortnight). Deposit growth was 17.4% yoy as of the same date(14.3% yoy as of 24
September 2010).
Absolute net loans grew Rs189bn during the fortnight ended 23 September 2011 (vs increase of
Rs294bn in the previous fortnight). Loans grew 19.5% yoy of the same date (19.0% yoy as of 24
September 2010).
Ytd deposit growth was 6.2% (Rs3,223bn) and ytd loan growth was 3.8% (Rs1,511bn). Thus, the
incremental loan to deposit ratio works out to about 47%.
The average three-month CD rate was 9.1% in 1QFY12, which fell only marginally to 9.0% in
2QFY12. Similarly, the 12-month CD rate declined from 9.9% to 9.6% in 2QFY12, but remains
elevated.
The base lending rate is now 10-10.75% and the one-year SBI deposit rate is now 9.25%. As a
consequence, loan growth is moderating (3.8% ytd in FY12 vs 5.5% in the same period of FY11)
and deposit growth is steadily gaining momentum (6.2% ytd in FY12 vs 4.8% in the same period
of FY11), translating into a more balanced liquidity scenario as far as banks are concerned.
Liquidity as reflected by repo borrowings appears to have improved of late – banks’ average daily
net borrowings were about Rs428bn in 2QFY12 compared to about Rs478bn in 1QFY12