Top officials from Reserve Bank of India (RBI), including Governor Shaktikanta Das urged public sector banks to improve their credit in a meeting with their heads. The meeting took place at RBI headquarters in Mumbai on Monday.
According to reports, RBI expressed its discontent over muted credit growth in banks. Latest RBI data shows that bank credit growth declined 8.5 per cent in January, as opposed to 13.5 per cent in the corresponding period last year.
Das questioned banks as to why credit growth was not picking up, CNBC-TV18 quoted a bank executive who attended the meeting as saying, adding that the RBI Governor asked bankers to get out of branches, develop connect with enterprises to push credit.
In its February policy, the RBI had announced a one lakh crore long-term repo auction for banks to borrow one and three year loans at repo rate.
During the meeting today, the RBI also sought status report on resolution of cases under the June 7 circular issued by the apex bank on stressed assets.
Last week, while speaking at an event, Finance Minister Nirmala Sitharaman acknowledged that bank credit growth is yet to pick up, while emphasising that banks cannot be "wild" in writing loans. She had added that banks have been specifically directed to avoid mistakes of 2008-09, when excess lending to stimulate Indian economy led to an NPA crisis.
Copyright©2022 Living Media India Limited. For reprint rights: Syndications Today