Indian retail banking sector, which mainly depends on transactions directly with consumers savings and lending, registered a decline in share of 5.02 per cent during the first quarter of 2009-10 as compared to the corresponding period last year as per an analyses of 30 public and private Indian banks by the Associated Chambers of Commerce and Industry of India (Assocham).
The private banks are performing better than the public banks in terms of their revenue from retail segment. The private and public banks have registered about 54.27 per cent and 35.47 per cent share respectively in retail banking during the first quarter of the current financial year. The cut in banking interest rate for lending like housing and auto loans had impacted the revenue of Indian retail banking segment.
The public sector banks registered a growth of 28.96 per cent in total income while their income from the retail segment grew only 9.92 per cent during the period. The share of retail banking for public sector banks declined from 41.61 per cent in the corresponding period in the previous financial year to 35.47 per cent now.
The private banks registered only 13.52 per cent growth in total income during the period but their income from retail segment registered a minimal decline of 0.16 per cent. The share of retail banking for private banks declined from 61.71 per cent in the first quarter of last year to 54.27 per cent now.
Among the private banks, ING Vysya Bank Limited recorded the maximum share of retail banking in its total income contributing nearly 80.20 per cent, followed by Kotak Mahindra Bank Limited (75.36 per cent), HDFC Bank of India (74.82 per cent) and ICICI Bank Limited (53.52 per cent). Other private sector banks which recorded major share in retail banking segment from their total income were Axis Bank (47.16 per cent), South Indian Bank (46.92 per cent), J&K Bank (45.90 per cent), IDBI Bank (43.45 per cent) and The Bank of Rajasthan Limited (22.91 per cent).
Decline in share
The banks which registered decline in share of retail banking during the first quarter of the current financial year as compared to the same period last year were The Federal Bank Limited (by 20.07 per cent), IndusInd Bank (16.22 per cent), Dhanalakshmi Bank (15.89 per cent) and Karnataka Bank ( 13.29 per cent). The analyses of fifteen public sector banks shows that State Bank of Hyderabad had the maximum share of retail banking segment contributing about 81.84 per cent to its total income followed by Andhra Bank with 42.14 per cent, State Bank of India with 39.81 per cent and Indian Bank with 38.01 per cent.
Other PSBs which present major share of retail banking segment in their total income were Andhra Bank (42.17 per cent), Indian Bank (38.01 per cent), Punjab National Bank (35.14 per cent), UCO Bank (37.42 per cent), Central Bank of India (34.45 per cent), Canara Bank (33.42 per cent) and Union bank of India (31.36 per cent).