Replying to a Business Standard query, the SBI chairman, however, said the working capital utilisation was still quite low in the domestic economy apart from the absence of big projects.
have enough liquidity and we are capable of meeting all the credit requirement of industry,” Kumar said, adding he perceived a gradual improvement in the credit off-take situation on the basis of projects in the pipeline, which would slowly gain momentum.
He said the expected results of the ongoing reforms process would be witnessed only after a certain period of time and not during the transitory phase. “A big transformation process is underway and we should not lose patience. The central government has initiated a lot of measures, including an elaborate consultative mechanism at the highest level.”
On the question of low credit deposit (CD) ratio in Uttar Pradesh, he observed the CD ratio was directly proportional to the rate of industrialisation in any state. “If there is higher industrial growth then the CD ratio also tends to be higher. At some places, the CD ratio is more than 100 per cent, while in some states it is at a lower level of 40 per cent.”
Currently, the CD ratio in UP stands at about 52 per cent compared to the national average of more than 70 per cent, which had prompted the Yogi Adityanath government nudge the RBI and commercial banks
to take proactive steps to improve it further.
Meanwhile, Kumar supported consolidation in the Indian public sector banks saying there was a requirement for consolidation and the process was on. “The merger process is underway and it definitely augur well for the banking industry as we need large sized banks in economy.”
On the topic of non-performing assets (NPA), he said NPAs of banks had peaked in 2018 and the situation was now better.
He said SBI was continuously working towards improving customer service through reorganisation and offering value added propositions. “Today, only 10 per cent of our transactions take place at the SBI branches, while 90 per cent of transactions occur outside the branches,” he informed.