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Bank liquidity remained sufficient says Finance Ministry
26-Mar-2025, 04:34
Finance Ministry stated in a latest monthly economic update today that in continuation of the trend seen throughout FY-25, deposit growth continued to trail credit growth in 2025. While scheduled commercial banks' (SCBs) credit growth was 12 per cent as of March 7, 2025, deposit growth (excluding the impact of the merger) was at 10.3 per cent for the period. This was also reflected in the banking system's credit deposit ratio (CD ratio), which was at 80.8 per cent. Overall bank liquidity remained sufficient, with a robust capital-to-risk weighted assets ratio standing at 16.7 per cent as of March 7, 2025. Despite a moderation in net interest margin, return on assets and return on equity reached decadal highs of 1.4 per cent and 14.1 per cent, respectively, in H1 FY25. Asset quality remained robust, with the gross non-performing assets ratio of SCBs remaining stable at 2.6 per cent as of September 2024, maintaining its 12-year low. Non-Banking Financial Corporations too, showed robustness across its system level parameters.
Finance Ministry stated in a latest monthly economic update today that in continuation of the trend seen throughout FY-25, deposit growth continued to trail credit growth in 2025. While scheduled commercial banks' (SCBs) credit growth was 12 per cent as of March 7, 2025, deposit growth (excluding the impact of the merger) was at 10.3 per cent for the period. This was also reflected in the banking system's credit deposit ratio (CD ratio), which was at 80.8 per cent. Overall bank liquidity remained sufficient, with a robust capital-to-risk weighted assets ratio standing at 16.7 per cent as of March 7, 2025. Despite a moderation in net interest margin, return on assets and return on equity reached decadal highs of 1.4 per cent and 14.1 per cent, respectively, in H1 FY25. Asset quality remained robust, with the gross non-performing assets ratio of SCBs remaining stable at 2.6 per cent as of September 2024, maintaining its 12-year low. Non-Banking Financial Corporations too, showed robustness across its system level parameters.
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