Calcutta: Public sector Uco Bank has registered an over 67 per cent year-on-year growth in retail credit during the festive season.
Retail advances of the Calcutta-based bank during the last one-and-a-half months stood at around Rs 400 crore. Bank sources said the growth was largely driven by the strong demand for home loans, which constituted 75 per cent of the total retail advances during the period.
A combination of low interest rates on home loans and a rising demand for housing drove Uco Bank's growth in the home loan segment.
An official of the bank said the lender charged an interest rate of 10.20 per cent (equal to its base rate) on home loans, similar to many lenders of its size. He added that the demand for housing loan witnessed a sharp rise in places such as Vijayawada and Surat, which are part of the Centre's smart cities programme.
The bank, however, has seen a marginal improvement in other retail segments such as car loans. It charges a rate of 0.25 per cent over its base rate for new car loans and 4 per cent on advances for used cars.
Chairman and managing director Arun Kaul said the bank would focus on improving its retail credit this year as a part of derisking its balance sheet.
The lender has decided to be selective on corporate credit to avoid adding to its non-performing assets (NPAs). Gross NPAs of the PSU bank for the quarter ended June stood at 4.31 per cent of its total advances. Uco Bank has informed the BSE that it would declare its second-quarter results on November 7.
Meanwhile, bank sources said the lender had identified Kingfisher Airlines as a wilful defaulter. The bank has an exposure of around Rs 300 crore to the company.