Synopsis:
Credit offtake continued to show robust growth, increasing by 20.2% year on year (y-o-y) to reach Rs. 147.6 lakh crore for the fortnight ending July 14, 2023. This surge was primarily driven by the impact of HDFC’s merger with HDFC Bank, which took effect in July 2023, as well as growth in personal loans and NBFCs. However, if we exclude the impact of the merger, credit offtake grew at a slightly lower rate of 14.4% y-o-y in the same fortnight (as reported on July 14, 2023). Looking ahead, the outlook for bank credit offtake remains positive, with a projected growth of 13-3.5% for FY24, excluding the merger’s impact. Including the merger, the growth is likely to be higher by approximately 3%. Deposits also witnessed healthy growth, increasing by 13.2% y-o-y for the fortnight (including the merger impact). On a pro forma basis, deposits grew by 12.3% y-o-y during the same period. The Short-term Weighted Average Call Rate (WACR) stood at 6.48% as of July 14, 2023, compared to 4.46% on July 15, 2022. This increase can be attributed to the elevated policy rates. However, it is worth noting that WACR has reduced from 6.69% as of May 04, 2023, and reached below 6.0% during Q1FY24. The net liquidity position stood at Rs. 1.92 lakh crore as of July 14, 2023, compared to Rs. 1.25 Lakh crore as of June 30, 2023, and Rs. 1.81 Lakh crore as of July 15, 2022.
