Most banks see slower loan growth amid weak demand
consumer demand, risk aversion to unsecured loans, and tepid deposit growth until late into the December quarter have meant that a majority of lenders clocked slower credit growth in the just concluded three-month period. Some banks such as HDFC Bank, which had an acute credit to deposit (C/D) ratio problem, have aggressively sold loans during the quarter, resulting in a loan growth of a mere 3% compared with a 15% deposit growth. Only IDBI Bank and IndusInd Bank reported loan growth in excess of deposits during the quarter, provisional data published by banks showed.
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At HDFC Bank, the difference was stark. Deposits climbed five times faster than loans at 15% on year,versus 3% loan growth in Q3.
More importantly, the December ended quarter was the first time, since the bank took over its parent in July 2023, that the aggregate deposits of the bank were higher than its total loan book. Total deposits increased 15% on year to ₹25.6 lakh crore versus loan book at ₹25.4 lakh crore.
To put it into perspective, in the quarter ended December 2023, the gap between HDFC's loans and deposits was a whopping ₹2.5 lakh crore with deposits at ₹22.1 lakh crore and loans at ₹24.7 lakh crore.
HDFC Bank sold ₹21,600 crore of loans via securitisation during the quarter taking the total amount of loans sold to
