IndusInd Bank records meagre 4% deposit growth

Mumbai: Private lender IndusInd Bank on Tuesday said it’s advances grew 13 per cent at the end of March 2020 much slower than the 20 per cent growth it had recorded in credit growth at the end of the December quarter. In value terms it’s advances stood at Rs 2.09 lakh crore versus Rs 1.86 lakh crore during the corresponding period last year.

It’s deposits grew a paltry 4 per cent at the end of March to Rs 2.02 lakh crore versus Rs 1.94 lakh crore at the end of March 2019. It’s deposits had grown 23 per cent at the end of December. Out of the total deposits 34 per cent was contributed by retail and small business customers. It’s CASA ratio stood at 40.5 per cent at the end of March 2020, which was at 43.1 per cent in March 2019 and 42.4 per cent at the end of December.

The bank had recently said that it saw a tenth of its deposits flow, as one major state-government withdrew its liabilities.

Private sector peer RBL too lost 8 per cent of its deposits in the March quarter as a few government entities and corporations took flight with their liabilities. Both these lenders have also seen a significant erosion in their market value since last year.

This flight to deposits has been even after RBI Governor Shaktikanta Das assures depositors that there money was safe.

“Your money is safe, the Indian banking system is safe and sound,” he had appealed on March 26. “In the recent past, COVID-19 related volatility in the stock market has impacted share prices of banks as well, resulting in some panic withdrawals of deposits from a few private sector banks. It would be fallacious to link share prices to safety of deposits. Depositors of commercial banks including private sector banks need not worry on the safety of their funds.”