Axis Bank expects personal loan growth to continue
₹65,083 crore as on 31 December. In comparison, ICICI Bank and HDFC Bank witnessed a 37.3% y-o-y and 10.3% y-o-y growth in personal loans. Sumit Bali, group executive and head of retail lending at Axis Bank, said that over 80% of customers in the personal loan segment are existing ones and the bank has quite a bit of their banking history.
Such data on past transactions help banks make better credit decisions. To be sure, the share of existing bank customers in personal loans is higher than in segments like loan against property (76%), auto loan (65%), and home loan (57%), besides others. The bank’s total advances grew 22% y-o-y to ₹9.32 trillion as on 31 December.
Retail loans, a subsegment of the overall advances, rose 27% y-o-y. “The growth (in personal loans) you see is a result of some transformation projects we have been running over the years and are midway through that journey. We expect portfolio quality will hold up and this kind of growth will continue," said Bali.
He said that the bank was not sacrificing quality for the sake of growth. “We have just tweaked (some) minor onboarding criteria but it is insignificant. These are not related to the newsflow you see but internal process changes to get more efficient," said Bali when asked if the bank is looking to tweak any risk filters following RBI’s concerns around the banking sector’s brisk growth in unsecured loans.
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