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Core push for bank credit

The banking industry is set to benefit from a spate of infrastructure projects announced recently as they will help improve its credit demand, according to the State Bank of India.

By A Staff Reporter in Calcutta
  • Published 24.09.17
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Arundhati Bhattacharya in Calcutta on Saturday. Picture by Pradip Sanyal

Calcutta, Sept. 23: The banking industry is set to benefit from a spate of infrastructure projects announced recently as they will help improve its credit demand, according to the State Bank of India.

SBI chairperson Arundhati Bhattacharya today said the government had to play a role in kickstarting the credit and investment cycle.

"The government has to do a little bit of heavylifting and this is already happening. We just saw the announcement of bullet trains and other corridors. There are signs of increase in the number of road and railway tenders," Bhattacharya said, adding that petroleum, fertiliser and power transmission are some of the other sectors with new projects.

The SBI today inaugurated the SBI Institute of Management in Calcutta to provide training in banking and finance.

Bhattacharya said these projects would eventually require debt even as they were not yet reflected in the books of banks because of procedural issues, such as the preparation of detailed project reports.

Bhattacharya said fresh slips into bad loans were coming down though certain sectors such as telecom were showing signs of stress. "Slippages will come down. But, there are new sectors showing stress, such as telecom," she said.

Bhattacharya also spoke in favour of recapitalisation for banks.

"We are well capitalised and have enough strength to raise capital. But, some banks may need a leg-up, otherwise their operations may suffer," she said.