SBI TARGETS HOME LOAN PORTFOLIO OF ₹10 LAKH-CR IN FIVE YEARS

State Bank of India expects to double its home loan portfolio in the next five years to ₹10 lakh crore, riding an uptick in economic activity and an aspirational young population.

Chairman Dinesh Khara said on Wednesday that SBI dominates the home loan market in India with a 35% share among all commercial banks.

The bank’s home loan portfolio crossed ₹5 lakh crore recently from ₹4.84 crore on 31 December, which constituted 23% of its loan book.

“When it comes to home loan demand, it is a function of the economy and demographics. You would have observed there is a definite change in the demographic and the younger generation is looking to acquire homes at a much early age as compared to what it was 10 years back,” he said.

Khara said 42% of the bank’s home loan customers were 40 years or younger, and as they start earning even more, their aspirational lifestyle and growing trend of nuclear families will lead to greater demand for homes.

Prevalent low interest rates have also prompted people to switch from one lender to another, and SBI benefited from this sensitivity to interest rates, he said. State Bank of India’s home loans start at 6.8%. “Metro locations are normally very sensitive to interest rates and we have been successful in having about 23% of ₹5 lakh crore on account of takeover (of loans),” said Khara.