While RBI and Finance Minister express concerns, SBI remains unfazed by deposit dip

In recent months, a growing concern over the decline in bank deposits has surfaced, prompting anxiety from key financial leaders including Finance Minister Nirmala Sitharaman and Reserve Bank of India (RBI) Governor Shaktikanta Das. Efforts are underway to reverse this trend, given its significant impact on the banking sector.

However, the State Bank of India (SBI), the nation’s largest lender, remains confident in its position. On Friday, SBI Chairman Dinesh Khara reassured that the bank does not view the current situation as a major challenge. He emphasized that SBI is well-equipped to sustain its loan growth by reallocating resources from its excess investments in government securities.

Deposit growth has lagged behind loan growth across the banking system for nearly two years, a trend also observed at SBI. While some experts attribute this disparity to a shift of savings towards high-yield capital market options, SBI’s own research dismisses these concerns as 'statistical myths.'

Khara stated, “We are in a position to support the growth in our loan book effectively. As long as we can sustain loan growth, I don’t foresee any significant challenges.” He highlighted that SBI has investments exceeding Rs 16 lakh crore and is utilizing a portion of its excess statutory liquidity ratio (SLR) to facilitate continued loan growth.