Strong demand in the housing sector; Expect 8-10% loan growth in FY 22: Sbi chairman
State Bank of India (SBI) Chairman Dinesh Kumar Khara said on Thursday that he expects lending growth of 8-10% in fiscal year 22. He said the growth path lending for SBI has so far been mixed. The months of October and November were good from an overall credit growth perspective.
He said: âCredit growth in 2022, we hope we should be between 8-10%. “
âIn terms of the growth trajectory we’ve seen over the current year so far, it’s been a mixed bag and maybe from October we have seen decent growth. October and November were very decent even in terms of the rise in business credit, âhe added.
Khara also mentioned that the demand from the housing sector has been strong. He explained that areas such as chemicals and allied products, food processing and mining also saw good loan growth. He said: âWe have seen credit growth in chemicals and related products, even food processing, infrastructure, mining, rubber, plastics and other products; textiles also experienced accelerated growth in October 2021. “
He hopes personal lending will continue to grow in 2022 as well. As for business credit growth, he believes it will improve once the uncertainty over Omicron subsides a bit.
âRetail has continued to grow throughout this time. And I hope it will continue to grow even better as we approach 2022,â Khara said.
He noted that the credit-to-deposit ratio improved for the bank by 300 basis points compared to September 2021.
Regarding the net interest margin (NIM), Khara noted that the number has remained historically stable for SBI in the range of 3.20 to 3.25%.
Regarding NPAs and Provision Coverage Ratio (PCR), he said the SBI is quite well positioned. He said: âFor the industry as a whole as well, PCR is now around 70%. We are quite comfortably placed, we are at about 80% PCR. I would say we don’t have visibility into a large account that’s susceptible to stress. “
Khara believes that working with fintechs can bring value to customers. âWhen it comes to fintechs, they offer a great solution to a particular problem. So I think that as a big lender, we have the capacity to use the solutions that they offer. So to that extent, we are all collaborating and we are trying to add value for customers, âhe said.
He expects ‘YONO’ to create significant value for SBI in the future. He said, âI think we have a lot more features than we can offer and YONO can really create significant value for the bank. “
Watch the video for the full interview.