RBL deposits reached 8% due to state government withdrawals
Mumbai: () said it lost almost 8% of its deposit base following the decision of some companies to withdraw. This is the second lender to attribute the withdrawals to a state government. Earlier this week, IndusInd had said its deposit base fell 11% following a state government decision to withdraw funds.
Earlier this month, the Maharashtra government said it had ordered all departments and companies to close accounts with private banks. The Maharashtra government's decision came in the wake of the crisis at Yes Bank, which was suspended for almost two weeks before being rescued by the SBI and other lenders.
The large-scale withdrawal of deposits by the state government has caused private bank stock prices to come under pressure. In a stock market filing, RBL said that despite losing 8% of its in the fourth quarter, it saw a strong track record of operating profit growth. On the impact, the bank said a detailed portfolio review is underway to assess the potential impact. The recent volume reduction exercise has helped to significantly reduce the risk of portfolio concentration, the bank said.