Nirmala directs PSBs to enhance deposit growth

Asset-Liability Mismatch

♦ Deposits growing 400bps lower than credit growth

♦ Banks told to leverage their vast branch network

New Delhi: Finance Minister NirmalaSitharman on Monday held a performance review meeting with heads of public-sector banks (PSBs) and urged them to improve their deposit growth.

Deposits have been growing 300-400 basis points lower than the credit growth in the last few months, creating an asset-liability mismatch for banks. According to sources, the Finance Minister reviewed the financial performance of banks and progress made in the implementation of various flagship schemes of the government, including PM AwasYojana, PM Surya Ghar and PM VishwakarmaYojana. Sitharman also took stock of deposit growth, credit-to-deposit ratio (CD ratio) and asset quality, sources said.