State Bank of India (SBI) Chairman Dinesh Khara has dismissed concerns regarding the bank's ability to fund its projected loan growth, highlighting that the lender has an excess liquidity of Rs 3 lakh crore to support a 17% increase in loans. Speaking at a press conference, Khara emphasized that SBI's liquidity position is robust and more than sufficient to meet the credit demand in the economy.
Strong Liquidity Position
Khara stated that SBI's excess liquidity, amounting to approximately Rs 3 lakh crore, provides a strong buffer to fund the anticipated loan growth. He noted that the bank's deposit growth has been healthy, and the liquidity surplus is a result of prudent management. The chairman also mentioned that the bank's credit-to-deposit ratio is comfortable, and there is no need for any immediate concern regarding funding constraints.
Supporting 17% Loan Growth
The bank is targeting a loan growth of around 17% for the current financial year, driven by demand from retail, corporate, and agricultural sectors. Khara expressed confidence that the excess liquidity will adequately support this growth without putting pressure on the bank's balance sheet. He also highlighted that SBI has been able to maintain a healthy net interest margin, which further strengthens its ability to support credit expansion.
Robust Financial Health
Khara further elaborated on the bank's overall financial health, pointing to strong capital adequacy ratios and declining non-performing assets. He stated that SBI's asset quality has improved significantly, with gross NPAs at their lowest level in several years. This, combined with the excess liquidity, positions the bank well to navigate any potential challenges in the economic environment.
In response to questions about the impact of rising interest rates, Khara said that the bank has been able to pass on the rate hikes to borrowers effectively, ensuring that margins remain stable. He also noted that the demand for loans remains robust across segments, and the bank is well-prepared to meet this demand.
Outlook and Future Plans
The chairman outlined SBI's strategy for the coming quarters, which includes expanding its digital footprint, enhancing customer experience, and focusing on sustainable lending practices. He reiterated the bank's commitment to supporting economic growth while maintaining financial prudence. Khara concluded by stating that SBI's strong liquidity position and sound fundamentals will enable it to achieve its growth targets without any funding constraints.
