Thursday, 30 August 2012

Priority Sector Lending

Extract from Economic Survey 2012, Chapter 5 "Financial Intermediation and Markets", pgs 108- 109.

A target of 40 per cent of adjusted net bank credit (ANBC) or credit-equivalent amount of offbalance
sheet exposures (OBE)( whichever is higher as on 31 March of the previous year), has been stipulated for lending to the priority sector by domestic SCBs in the public and private sectors. Bank loans to MFIs have also been included in priroty-sector lending. Within this, sub-targets of 18 per cent and 10 per have been stipulated for lending to agriculture and the weaker sections respectively.

A target of 32 per cent (of ANBC or credit equivalent amount of OBE, whichever is higher), has been stipulated for lending to the priority sector by foreign banks having offices in India.

Although public-sector banks as a group had achieved the overall priority-sector lending target in 2010 fiscal yr, seven out of 27 banks could not individually achieve the target

Private sector banks as a group had achieved the overall lending target in 2010 fiscal yr, and only one of the 21 could not individually achieve the target.

Foreign banks as a group also achieved the overall priority sector lending target on the last reporting Friday of March 2011. However, three of the 30 foreign banks did not individually achieve the target.

1 comment:

  1. Please see Nair Committee Recommendations also.