Banks' high retail loan book due to securitisation by NBFCs, not actual credit demand: Crisil
5 years, 1 month ago

Banks' high retail loan book due to securitisation by NBFCs, not actual credit demand: Crisil

Firstpost  

Adjusted for the securitisation, which is when a lender transfers future receivables to another one, retail credit growth will come at a lower 12 percent for the first half of the fiscal, as aga Mumbai: Banks’ retail credit growth is up due to higher reliance on securitisation by liquidity starved non-banking lenders, and does not represent a higher credit pick-up by small borrowers, says a report. Adjusted for the securitisation, which is when a lender transfers future receivables to another one, retail credit growth will come at a lower 12 percent for the first half of the fiscal, as against 16.6 percent classified as “retail credit growth”, Crisil said in a report on Tuesday. The adjusted retail credit growth numbers, net of securitisation, for FY19 has also gone down to 12 percent from 16 percent in FY18, it said, pointing out that securitisation volumes have soared. The note also said the slowdown in retail credit growth reflects both macroeconomic challenges which have constrained loan demand and fewer loan sanctions by banks because of risk aversion.

Growth Retail Credit Securitisation Retail Credit Growth  banks  securitisation  credit  volumes  retail  high  fiscal  loan  nbfcs  12  receivables  growth  book  adjusted  crisil  demand

History of this topic

NBFC lenders find borrowing a costly affair
9 months ago

NBFC lenders find borrowing a costly affair

Live Mint  

MUMBAI : Non-bank lenders are struggling through a spike in borrowing costs as banks have become cautious in lending to them following a regulatory warning, forcing these companies to diversify their money sources. The Reserve Bank of India in November increased the risk weights on NBFCs by 25 percentage points, making their cost of borrowing from banks costlier by 30-50 …

Credit growth trajectory likely to slow down to 12-14% YoY over FY25-27, says Emkay Global
9 months, 3 weeks ago

Credit growth trajectory likely to slow down to 12-14% YoY over FY25-27, says Emkay Global

Live Mint  

India’s banking sector is expected to face a slowdown in credit growth and with banks exhausting strategies to sustain margins, the imperative for mobilizing deposits emerges, analysts said. The credit growth trajectory is expected to slow down to 12-14% year-on-year over FY25-27E from the current 16.5% YoY, according to Emkay Global Financial Services. The overall deposit growth and more so …

Retail loan boom amid covid: Sign of trouble ahead?
3 years, 6 months ago

Retail loan boom amid covid: Sign of trouble ahead?

Live Mint  

Retail loans, or loans given to individuals, could soon become the largest segment in India’s credit market, taking away the top spot from industrial loans. One retail segment where government banks have leapfrogged private banks is personal loans, according to a December 2020 report on personal loans by CRIF High Mark Credit Information Services, a credit bureau. In March 2020, …

Concerns re-emerge on retail loans asset quality due to rising lockdowns: ICRA
3 years, 8 months ago

Concerns re-emerge on retail loans asset quality due to rising lockdowns: ICRA

Hindustan Times  

The rising Covid-19 cases has again raised concerns on asset quality of retail loans from non-banking financial companies and housing finance companies, according to investment information agency ICRA. Following the second wave of the pandemic, ICRA expects securitisation volumes to again get impacted in Q1 FY22 as NBFCs and HFCs will be more selective in fresh lending. However, said ICRA, …

Securitisation volumes to get back on growth track in FY22: Icra
4 years ago

Securitisation volumes to get back on growth track in FY22: Icra

Business Standard  

Securitisation volumes to get back on growth track in FY22: Icra Credit quality of the rated pass-through certificates should remain 'Stable' during FY22, says rating agency Premium The rating agency said increase in securitisation volumes for the rest of FY21 an in FY2022 would be supported mainly by growing investor confidence in asset quality due to improving collections Abhijit Lele …

Bank credit growth may have bottomed out at 6%: Crisil
4 years, 10 months ago

Bank credit growth may have bottomed out at 6%: Crisil

The Hindu  

Credit growth of commercial banks may have bottomed out, which is expected to be 6% this financial year and in 2020-21, the growth could improve to 8-9%, rating agency Crisil said. “The prolonged slowdown in bank lending may be bottoming out this fiscal, with gross credit offtake set to rise 8-9% on-year in fiscal 2021, a good 200-300 basis points …

Why retail loans continue to grow amid a slowdown
5 years, 5 months ago

Why retail loans continue to grow amid a slowdown

Live Mint  

How fast have retail loans of banks been growing? The year-on-year growth of retail loans of banks over the last two years has been in the range of 15-20%. In June 2019, the y-o-y growth in retail loans was a strong 16.6%. Retail loans primarily comprise home loans, vehicle loans, credit card outstanding, education loans and personal loans. Hence, the …

Opinion | Banking sector was positive on retail finance
6 years ago

Opinion | Banking sector was positive on retail finance

Live Mint  

Retail lending has had a good run in India in recent years. Disenchantment with corporate finance, the emphasis and almost direction by the concerned ministry to PSBs on increasing the retail portfolio and indeed the continuing interest in this segment across the entire banking industry, as well as the rapid increase in the number and growth of non-banking finance companies, …

Unsecured bank loans rise four-times in last three years on higher discretionary spending, lower interest rates: Crisil
6 years, 6 months ago

Unsecured bank loans rise four-times in last three years on higher discretionary spending, lower interest rates: Crisil

India TV News  

The unsecured bank loans have grown four times the bank credit in the past three years, according to a report by global analytical company Crisil. According to the report, the growth in unsecured bank loans have been mainly on account of discretionary spending, technology-driven disbursements and lower interest rates. “Between fiscals 2015 and 2018, unsecured credit - comprising personal, small …

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