ICICI, India's largest private sector lender, expects Rs. 1300 crore monthly in saving accounts from all its branches across the country. The bank is expected to set up 580 branches this fiscal.
The bank has been concentrating on increasing its share of CASA (current account saving account) deposits in a bid to reduce its cost of funds. The bank has set a target to increase the percentage of its Casa deposits to 33 percent of the total deposits, an increase of 430 basis points over last year.
During the July-September Quarter of the fiscal, saving account deposits amounted to Rs. 4,900 crore while Casa deposits were 9,000 crore. The percentage of Casa increased from 30.4 percent in the previous quarter to 36.9 percent.
The increase in Casa deposits can be attributed to the addition of new branches and greater flow of money into the system because of higher salaries of government employees amidst Sixth Pay Commission recommendations.
Companies mobilising funds through initial public offerings and qualified institutional investments have also led to an increase in Casa deposits.
The government has also directed the public sector banks to focus on CASA deposits and asked the banks to reveal their Casa targets.