ICICI Bank cuts down unsecured loan offtake

The country’s largest private sector bank ICICI Bank said that it is pruning its portfolio of unsecured retail loans, including personal loans, small-ticket loans and credit cards.
“As far as credit growth is concerned, for the past three quarters, ICICI bank constantly letting unsecured retail portfolio to go down. ICICI are growing corporate finance book both on project finance and trade finance. ICICI bank are growing 20 per cent in the auto and housing sectors. It’s the other products such as personal loans, small-ticket loans and credit cards, which are coming down,” Chanda Kochhar, managing director and chief executive officer of ICICI Bank, said
Kochhar said there has been a pickup in credit during recent times. “A lot of investment activities have started to take place. Lots of projects have seen financial closure. They have started initial investment. Demand for credit will pick up in a big way in the next financial year. Deposits are picking up substantially, if you see quarter-on-quarter our CASA (current account savings account) deposits have show reasonable growth, both in terms of absolute volumes and in value,” she added.
In the recent past, the Indian banking system has witnessed a very low credit growth. As the economy recovers and investment activities coming back to normalcy, credit offtake is also like to witness gradual growth.
K V Kamath, chairman, ICICI Bank, concurred with Kochhar and said that RBI’s move will not impact interest rates during the coming nine months. “For the first nine months, I don’t think there is a real pressure on interest rates. There is still enough liquidity in the system. I think liquidity needs to come down to push up interest rates,” Kamath said.
Kochhar said there would not be any immediate impact on interest rates if the cash reserve ratio (CRR) is hiked by the Reserve Bank of India (RBI). "Interest rates are driven not just by policy announcements, but more by demand and supply of credit and liquidity,” she said.