Banks have put up a mixed performance so far as deposits and loans go even as liquidity has stayed tight and consumer demand is yet to pick up  during the fiscal third quarter ended December.

For some banks, deposits and credit grew in sync in the December quarter. In the earlier quarters, credit outpaced deposits as bank customers moved to other lucrative avenues like the stock market.

In case of state-owned Bank of Baroda (BoB), deposits grew 11.8% year-on-year to Rs 13.92 lakh crore for the quarter ended December 2024 while advances were up 11.7% to Rs 11.72 lakh crore. 

Similarly, state-run Punjab National Bank (PNB) reported a slightly higher deposit growth at 14.4% to Rs 13.3 lakh crore, compared to a 14.1% year-on-year rise in loan growth at Rs 9.4 lakh crore, according to the lender’s provisional quarterly business updates.

HDFC Bank, India’s largest private sector lender, saw deposits outpace credit growth by a wide margin during the December quarter. Faced with an unhealthy credit-to-deposit (CD) ratio, the bank aggressively sold loans as a strategic initiative. This resulted in a loan growth of 3% year-on-year compared to a deposit growth of 15.8%. Total gross advances stood at Rs 25.42 lakh crore as of 31 December 2024, while deposits were at Rs 25.63 lakh crore. 

This, in fact, was the first time since the bank absorbed its parent HDFC Ltd in July 2023 that the deposits stood higher than the loan book. The gap was a whopping Rs 2.55 lakh crore in the December 2023 quarter, with deposits at Rs 22.14 lakh crore lagging behind loans at Rs 24.69 lakh crore. 

In line with its strategic need to wipe out high-cost legacy borrowings, private lender IDFC First Bank reported deposits growing at a faster pace than credit. The bank’s deposits grew 29% year-on-year to Rs 2.27 lakh crore while loans rose 22% to Rs 2.31 lakh crore in the quarter ended December 2024. The CD ratio improved, dropping to 95.7% from 101.4% a year earlier. Since the 2018 merger of IDFC Bank and Capital First, the CD ratio has seen a downward trend. 

Yes Bank’s deposits grew 14.6% to Rs 2.77 lakh crore while loans and advances rose 12.6% year-on-year to Rs 2.45 lakh crore as of 31 December 2024.

IDBI Bank, IndusInd Bank and UCO Bank, however, reported higher loan than deposit growth in the December quarter. For IDBI Bank, the loan growth at 18% was double that of deposit growth at 9%. Total deposits stood at Rs 2.8 lakh crore and net advances at Rs 2.1 lakh crore as of 31 December 2024. The lender’s board of director approved raising Rs 10,000 crore through long-term bonds to finance infrastructure and affordable housing projects.

IndusInd Bank clocked a 12% growth in advances to Rs 3.67 lakh crore compared to a 11% rise in deposits to Rs 4.1 lakh crore, the private lender said in its provisional quarterly business updates.

In case of UCO Bank, total advances jumped 16% to Rs 2.08 lakh crore while deposits grew 9.37% to Rs 2.8 lakh crore.