Public sector banks (PSBs) continue to get more money as deposits from their customers, however, it is the private sector banks that have registered a greater growth rate in deposits in the financial year 2022-23 (FY23), a Financial Express (FE) report said.
The largest PSBs of the country -- State Bank of India, Punjab National Bank, Bank of Baroda, Canara Bank, and Union Bank of India -- registered a cumulative deposit of Rs 8.43 trillion in FY23. Among these banks, SBI had the highest growth in terms of deposits which stood at Rs 3.72 trillion.
Reasons behind the growth in deposits
Experts who watch the banking sector said that the rise in deposits can be attributed to the large branch network of public sector undertaking (PSU) banks, the confidence of the Indian public in the government sector banks, and the growing partnerships of PSU banks with third-party service providers which makes them more accessible.
Taking a look at the top five private sector banks reveals that HDFC Bank, ICICI Bank, Axis Bank, Kotak Mahindra Bank, and IndusInd Bank together registered a total deposit of Rs 6.60 trillion in FY23, the report said.
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For the first time, HDFC Bank registered a total deposit of Rs 3.24 trillion, not quite close to SBI's deposits but still a sign of strong growth in terms of deposits. Experts say that the ongoing merger of the Housing Development Finance Corp (HDFC) with the HDFC Bank may have added to this rise.
The aggregate deposits in all scheduled commercial banks in the country registered a growth of about 9.6 per cent year-on-year (YoY). Last year, the growth stood at 8.9 per cent YoY.
As the name suggests, the Current account and savings account (CASA) ratio represents the ratio between the current account and savings account deposits. While both PSBs and private sector banks have delivered healthy growth in deposits in FY23, the CASA ratio has gone down.