NEWS & ADVICE : PERSONAL LOAN
ICICI to concentrate on corporate loans
By Neelima Shankar
Jun 11, 2008
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The bank has already increased the share of current and savings accounts of its total deposits to 26% from 22% of its total deposits by focusing on retail deposits. Also, a bank does not pay any interest on current accounts and pays 3.5% on savings accounts.

"Three years back, our corporate credit book was growing at 5%,” said Kochchar. “(For the) last two years, the growth was around 12-15%. Now, we could grow at even 25%. The high consumer spend in the last few years created huge demand, and Indian firms now want to invest big money. By our estimates, there is about $700 billion (Rs29.9 trillion) investment in the pipeline. If you include the working capital requirement of Indian firms and the money required for overseas acquisitions, banks’ corporate loan book should grow between 20% and 25% this year."

Kochchar has also challenged the market’s perception about growing NPAs in consumer finance in ICICI Bank.

"Yes, the total value of NPAs in consumer loans is growing, but this is because our portfolio of unsecured loans is growing,” she said. “Earlier, unsecured loans were 13% of our total retail loans and now they have gone up to 18%. But, the losses are moving within the accepted level."

There was a marginal increase in the NPAs of the bank, the net NPAs of ICICI stood at 1.49% in March, up from about 1% a year ago.


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