The state-owned Bank of Maharashtra (BOM) has outperformed public sector lenders in retail and MSME lending growth during 2020-21.
The Pune-based lender reported a 35 percent growth in MSME loans to Rs 23,133 crore in 2020-21. Chennai-based Indian Bank NSE grew by 5.19 percent and lending to MSMEs by 15.22 percent.
The total loan is Rs 70,180 crore. In terms of retail lending, Bombay State Bank of India (SBI), the country’s largest lender, grew by 25.61 percent, ahead of NSE by 0.57 percent, an increase of 16.47 percent.
As the consequences of the Covid-19 pandemic on the economy and financial sector are still unfolding, the bank is continuing to successfully navigate in these turbulent times amidst a rapidly changing environment.
To counter the impact of COVID-19, the Government of India unveiled a stimulus package worth INR 20-lakh-crore (10% of GDP), focusing on MSMEs, migrant workers, farmers, urban poor, and NBFCs. The Reserve Bank of India (RBI) has cut the policy repo rate to 175 basis points from February 2020, while providing adequate liquidity to the financial system.
The first couple of financial years came to a standstill as a nationwide lockdown was introduced. Thus, although there is widespread expectation that full-year output will shrink compared to the previous year, economic growth is expected to pick up in fiscal year Q3 and Q4, assuming that the pandemic dissolves in the second half of this year.
However, SBI’s asset base for the retail segment grew 30-fold to Rs 8.70 lakh crore. The bomb is worth Rs 28,651 crore. Bank of Baroda’s retail loan portfolio grew by 14.35 percent to Rs 1.20 lakh crore.
For the period 2020-21, BOMs’ consolidated net profit rose 42 percent to Rs 550.25 crore. 388.58 crore in the previous year. Total bad loans or gross non-performing assets (NPAs) declined to 7.23 percent of total advances at the end of March 2021, compared to 12.81 percent in the same period in 2020.
Total bad loans stood at Rs 7,779.68 crore at the end of March 2021. It was Rs 12,152.15 crore last year. From 4.77 percent (Rs 4,145.38 crore) Net NPAs declined to 2.48 percent (Rs 2,544.32 crore).