Reserve Bank of India (RBI) Governor Sanjay Malhotra has expressed confidence in the health of India’s banking sector, saying lenders remain well-capitalised, credit growth is broad-based across sectors, and the central bank does not see any immediate pockets of stress despite an uncertain global environment.In an interview with government-owned broadcaster DD News, Malhotra said the banking system is in a strong position, with the capital adequacy ratio at 17.5% and the liquidity coverage ratio at around 120%, providing banks with sufficient buffers to absorb potential shocks.
“The banking sector is absolutely strong,” Malhotra said, adding that India’s robust financial system has reinforced the country’s resilience amid geopolitical tensions and global economic uncertainty.
The RBI Governor said bank lending continues to expand at a healthy pace, with overall credit growing by around 18% year-on-year in June. Sectoral data up to May showed broad-based growth across key segments of the economy.During the month of May credit to agriculture grew about 15%, industry by 17%, MSMEs by 24-25%, infrastructure by 11-12% and housing by 11%.“This growth across all classes of people is a matter of satisfaction for us,” he said.Malhotra also dismissed concerns about excessive credit growth in any particular segment, saying the RBI’s supervisory assessment does not indicate systemic risks.“Today there is no sector of concern,” he said. “About two years ago there was pressure in microfinance, but at present, even though some segments like gold loans are witnessing higher growth, we do not see any immediate risk.”He said the central bank maintains intensive supervision over regulated entities to identify emerging vulnerabilities at an early stage.First Published: Jul 17, 2026 1:28 PM IST
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