State-Run Banks Gain­ing Share in Re­tail Lend­ing

MASS AP­PEAL

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rose to 35% from 34% in the same pe­riod; while for pri­vate banks it fell to 27.3% from 29.6%.

Un­dertheIn­drad­ha­niush­scheme, the govern­ment has set per­for­man­cepa­ram­e­ters­for­bankstobe­met so that it can al­lo­cate cap­i­tal. Those banks which grow their re­tail and farm­loan­swill­be­given­high­er­cap­i­tal al­lo­ca­tion. “Pri­vate banks have de­fended their share in hous­ing loans and im­proved in se­lect un­se­cured loans, but they lost ground in what ap­pears to be small ticket lend­ing that gets clas­si­fied un­der re­tail,” said the re­port.

Ko­tak ex­pects re­tail loans to grow at 17% CAGR over FY2016-20 and their con­tri­bu­tion to over­all loans to in­creaseto25%from18%inFY2014.

One of the big­gest ad­van­tages prob­a­bly giv­ing com­fort to banks to build their re­tail plat­form is stronger consumer bal­ance sheets as com­pared to cor­po­rate bal­ance sheet at this stage. “Among pub­lic banks, we ex­pec­tSBI­to­playadom­i­nantroleas it has an es­tab­lished busi­ness in re­tail as­sets, cus­tomer base and reach,” it said.

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