Bank Loans Grow at a Slower Pace in February

Decline in Non-Food Credit Growth

• 10.9% YoY growth (as of February 21, 2025) vs. 20.6% YoY growth a year earlier
• Primary Factors: Slower growth in retail loans and NBFC credit

Retail Loan Slowdown

• 11.7% YoY growth, down from 28.1% in the previous year
• Major Contributors to Decline:
  • Unsecured personal loans
  • Credit card outstanding balances
  • Vehicle loans

Credit to Services Sector

• 12% YoY growth, significantly lower than 24.3% a year ago
• NBFC Credit Decline: Major reason for slowdown
• Bright Spots:
  • Computer software sector saw higher credit growth
  • Professional services and trade maintained strong momentum

Industrial Credit Trends

• 7.3% YoY growth, slightly down from 8.4% last year
• Key Industries Showing Strong Growth:
  • Petroleum, coal products, and nuclear fuels
  • Engineering and construction
  • Paper & paper products

The sharp decline in retail loans and NBFC credit has dragged overall bank loan growth in February 2025. However, select industries and the computer software sector continue to see healthy credit expansion.

TET