Archive · 1 Dec 2025
SBI Predicts Corporate Loan Growth Rebound
The State Bank of India (SBI) thinks that companies will start borrowing more money from banks soon.
This is because they have used up the money they got from selling shares in the stock market and now need more funds for their daily operations.
The bank says that the slowdown in loans was temporary and that things are looking up.
They expect businesses to need more loans for things like buying raw materials and running their supply chains.
The central bank, RBI, will also make sure there is enough money available for these loans.
SBI is confident about their plans and thinks the economy is doing well, which will lead to more companies needing loans.
SBI expects a rebound in corporate loan growth due to increased working capital utilization and strong economic activity.
Recent surge in IPO fundraising temporarily reduced credit demand, but this effect is waning.
Companies across several sectors are increasing their working capital utilization, indicating improving credit demand.
Strong GDP numbers support higher funding needs, pushing companies to seek more loans.
RBI's proactive liquidity management will ensure banks have sufficient funds to meet rising credit demand.
- Who
- State Bank of India (SBI) and its Chairman C S Setty
- What
- SBI expects a rebound in corporate loan growth due to increased working capital utilization and strong economic activity
- When
- Growth expected in the remaining two quarters of FY25, with a rate cut expected in December 2025
- Where
- India
- Why
- Due to improving economic activity and strong corporate credit demand, as well as the utilization of IPO funds
Optimistic View
Cautious View
Credit Growth
Optimistic View
Credit growth is expected to rebound due to increased working capital utilization and strong economic activity.
Cautious View
Past trends show a modest negative correlation between IPO fundraising and bank credit growth, suggesting a temporary reduction in borrowing.
- Credit Growth
- Expected to rebound in coming quarters
- IPO Fundraising
- Recent surge in IPO fundraising temporarily reduced credit demand
- Working Capital Utilization
- Increasing across several sectors, indicating improving credit demand
- Economic Momentum
- Strong GDP numbers supporting higher funding needs
- RBI's Role
- Proactive liquidity management to meet rising credit demand
- Sectors with Lower Credit Growth
- Finance, automobiles, pharmaceuticals, telecom, consumer durables, and infrastructure
- Corporate Loan Growth
- Lower double-digit growth expected in remaining two quarters of FY25
- Credit Pipeline
- ₹7 lakh crore loan sanctions in pipeline
- Capital Adequacy Ratio (CRAR)
- 15% target over 5-6 years
- Common Equity Tier 1 (CET1)
- 12% target over 5-6 years
- QIP Fundraising
- ₹25,000 crore raised in July 2025
- Tier II Bonds
- ₹12,500 crore to be raised in 2025
- Net Interest Margin (NIM)
- 3% guidance expected to be achieved
- RBI Rate Cut
- 0.25% shallow cut expected in December 2025
Sources
SBI Chairman sees double-digit corporate loan growth in FY26, ₹7 lakh cr credit in pipeline
High growth rate brings difference in opinions on rate cut by Monetary Policy Committee
Credit growth to rebound as IPO liquidity spent and working capital demand rises: SBI
Mint Explainer | GDP at 8.2%, fiscal deficit rising: What it means for the Indian economy
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