Liquidity started flowing to India Inc from banks after a drought of around six month. Now companies are finding some takers for debt and equity issues. Banks are gradually discarding their aversion to financing new projects and foreign investors are heading back to India. However, banks are seen still biased towards government bonds in spite of continued growth in deposits.
Private and the foreign banks are yet to increase lending in a big way as public sector banks have already started financing projects.
After reporting a drop of Rs 25,266 in credit in the last fortnight of April, banks have lent Rs 5,881 crore to companies, individuals and other businesses during the fortnight ended May 8, according to the newest figures released by the Reserve Bank of India.
Total loans amounted to Rs 27,52,056 crore as on May 8. However, the loan growth in the corresponding fortnight last year was much higher at Rs 17,500 crore.
Private and the foreign banks are yet to increase lending in a big way as public sector banks have already started financing projects.
After reporting a drop of Rs 25,266 in credit in the last fortnight of April, banks have lent Rs 5,881 crore to companies, individuals and other businesses during the fortnight ended May 8, according to the newest figures released by the Reserve Bank of India.
Total loans amounted to Rs 27,52,056 crore as on May 8. However, the loan growth in the corresponding fortnight last year was much higher at Rs 17,500 crore.
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