Explained: RBI’s concerns on slow deposit growth -Saptaparno Ghosh

-The Hindu

Why did senior officials of the apex banking regulator meet the MD and CEOs of public and certain private sector banks? What are the possible reasons for low deposit growth? What is the net status of non-performing assets? Has credit growth risen when compared to the year-ago period?

The story so far: The Governor, Deputy Governor and a few other senior officials of apex banking regulator, the Reserve Bank of India (RBI), met MD and CEOs of public and certain private sector banks on November 16. Acknowledging the role played by private commercial banks in supporting economic growth during the pandemic and in the ongoing financial market turmoil, the Governor advised that banks “remain watchful” of the evolving macroeconomic situation, including global spillovers. Discussion points included the lagging growth in deposits in relation to credit growth, asset quality and adoption of new-age technology solutions among other things.

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