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Retail aggression: BoM aims 35%, BoB 15% growth

Representatives of two PSU banks discuss the progress made, the challenges being faced and the growth prospects in retail loans of their respective banks:

RBI has said the focus by lenders on the retail segment has helped increase the share of personal loans in the system from 17.9% in March 2016 to 19.3% in June 2016. Citing data, the regulator has said home loan segment was one of the prime contributors to this uptick. Credit growth at private lenders which are better off from the asset quality troubles, was higher while rural and semi-urban areas continued to grow at a faster pace than urban and metropolitan regions. The data covers performance by 91 banks from over 1.09 lakh outlets.

The total amount of home loans, vehicle loans, and educational loans extended by Bank of Maharashtra (BoM) in Q2, 2016-17 was respectively Rs 371.25 cr, Rs 55.39 cr and Rs38.31cr. Home loans numbering highest-2251, was followed by educational loans (1240) and vehicle loans (1122). West zone topped the country both in terms of volume and value of home loans, vehicle loans, and educational loans, whereas east zone could muster the least number and amount of all these 3 types of retails loans amongst all the 4 zones.

R.K. Gupta, ED at BoM, says: “There is a notable growth during Q2-2016-17 over Q2-2015-16 in all major segments led by housing segment which registered a y/y growth of 21% in sanctions and 27% in disbursal. This phenomenon is common for all 4 zones of the country. However, south zone has registered the highest growth. Vehicle loans have also shown similar trend. Retail loans to priority sector constitute 7% of total loans of the bank. It is important to note that the number of both home loans (2535 in Q2, 2015-16) and educational loans (1492 in Q2,2015-16)) on y/y basis has decreased but in value terms all the 3 types have registered an increase y/y.”

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