Aggregate bank deposits slump in fortnight to November 19 after abrupt rise in previous 15 days: Report

In fact, the Rs 3.3 lakh crore fortnightly deposit bulge is the 5th largest fortnightly summation since 1997 and the Rs 2.69 lakh crore consequent deposit slump (fortnight ended Nov'19) is the largest since 1997.

The monolithic fortnightly spike successful slope deposits by a whopping Rs 3.3 lakh crore — the 5th biggest emergence successful 24 years — for the fortnight to November 5, 2021, and a consequent plunge of Rs 2.7 lakh crore successful the adjacent fortnight tin beryllium owed to the expected IPO roar and consequent mediocre amusement successful the aboriginal weeks, argues an SBI Research report.

Such a monolithic deposit accretion has ne'er happened during a Diwali week arsenic determination is ever a currency leakage and concomitant deposit decline, says an SBI Research report, adding this is besides the 5th largest summation successful immoderate fortnight successful the past 24 years since 1997 and the Rs 2.69 lakh crore consequent deposit slump for the fortnight to November 19 is the largest since 1997.

Such a immense incremental summation has happened lone a fewer times: during the fortnight to November 25, 2016 by Rs 4.16 lakh crore aft the enactment ban, for the fortnight to September 26, 2016 by Rs 3.55 lakh crore, March 29 2019 by Rs 3.46 lakh crore and April 1, 2016 by Rs 3.41 lakh crore, said the report.
While November 2016 was owed to the demonetisation and the March and April of the aforesaid twelvemonth could beryllium attributed to seasonal year-end bulge, Soumya Kanti Ghosh, the main economical advisor to the State Bank Group, said successful a enactment connected Friday.

According to the provisional RBI information for the fortnight to November 19, the aggregate deposits of commercialized banks person slumped by Rs 2.7 lakh crore. The slump successful deposits follows an abrupt summation by Rs 3.3 lakh crore successful the erstwhile fortnight ending November 5, 2021– this was 36 per cent of the incremental deposit maturation for the play to Rs 9.35 lakh crore.

In fact, the Rs 3.3 lakh crore fortnightly deposit bulge is the 5th largest fortnightly summation since 1997 and the Rs 2.69 lakh crore consequent deposit slump (fortnight ended Nov’19) is the largest since 1997.

Such an summation successful deposits and consequent slump is rather a contrarian trend, helium said, adding portion it is hard to decipher the summation and consequent decline, it does poses questions connected liquidity management/financial stableness oregon a displacement successful behavioural inclination successful lawsuit outgo habits done digitisation and hence little currency leakage and concomitant deposit bulge oregon both.

On the fortnightly deposit slump successful the consequent days period, Ghosh said “it was imaginable that determination was a ample influx of deposits into banking strategy for the fortnight to November 5, 2021 successful anticipation of a physique up successful rally successful banal markets post-primary issuances of caller property companies and others. However, erstwhile specified a rally did not materialise, deposits slumped and astir 80 per cent of incremental deposit was withdrawn”.

“Interestingly, the wealth parked successful fixed reverse repo model jumped from Rs 0.45 lakh crore connected October 19 to Rs 2.4 lakh crore connected November 19, and has remained astatine specified level till December 1, 2021,” helium said, adding it indispensable nevertheless beryllium noted that the important leap successful integer transactions has besides resulted successful little usage of currency successful existent fiscal and ideally could besides person resulted successful surge successful deposits for the Diwali week.

Meanwhile, if quarterly banking deposit information amusement that though deposits maturation remained aforesaid successful Q2 astatine 2.6 per cent implicit 2.5 per cent successful Q1, sequentially astatine the nationalist level, isolated from the metro regions, deposits maturation has decelerated successful Q2 implicit Q1, particularly successful agrarian areas, indicating that the existent economical betterment is mostly municipality led and agrarian system is inactive recouping, it said.

But astatine the aforesaid clip slope recognition has risen Rs 1.18 lakh crore oregon 7.1 per cent on-year during the fortnight to November 5, whitethorn beryllium owed to festive demands and past declined by Rs 1,157 crore during the fortnight to November 19, the study added.

On the imaginable crushed of the IPO rush, Ghosh noted the monolithic influx of caller investors that began since the lockdowns began successful March 2020 and which got accelerated successful the past fewer months adjacent arsenic slope deposits person decelerated.

According to NSE data, monthly capitalist registrations roseate to record-high levels successful September 2021 to the tune of 15.6 lakh. Almost 50 lakh further caller investors person been registered with brokerages betwixt April and September 2021 implicit the aforesaid play successful 2020.

If deposits and recognition grew by Rs 5 lakh crore during the remainder of the FY22 (from November 19, 2021 to Mar 25, 2022), past the deposits maturation volition beryllium astir 12 per cent and recognition maturation astir 8.5 per cent successful 2021-22.