Corporates see bank funding as supplemental route: KV Kamath

Corporates see bank funding as supplemental route: KV Kamath

K V Kamath

"Corporate clients are on their growth path on their own because they are facilitated by very strong internal cash accruals and a very buoyant equities market which is giving them all the funding resources they want," ICICI Bank's Chairman, K V Kamath, told reporters on the sidelines of a meet here today.

Even if there is a tightening (of policy rates), corporates will be able to manage in terms of sourcing finance and expansion, he said.
"Even if there is a tightening (of policy rates), I think they (corporates) would manage because the flip side of this is that today you are seeing a lot of liquidity which is despite the sort of growth that we are getting, a current run-rate of 10 per cent," Kamath said.

The system should not be throwing up the liquidity that is being thrown up, he added.
Growth would continue to take place, the ICICI Bank Chairman said, adding "we should keep our eyes on our intent to invest and whether actual investment is happening or whether we are straying away from that."

"If that is being put on the backburner, then probably intervention is required," Kamath said.
According to him, there did not seem to be any intent in terms of doing away investment thoughts.
The next 10-years held an immense growth potential and India's GDP as well as per capita income would double, he said.
"I see in the next 10-years GDP and per capita income will double," he said.

Asked whether any pent-up demand was being witnessed in corporate borrowings, Kamath said that it was not pent-up demand but corporate lendings for new projects and within new projects, corporates were focusing on infrastructure.
Kamath saw no challenge in terms of funding irrespective of the global situation. "We are self-sufficient to fund our own projects," he said.
The veteran banker felt that an 18 per cent credit growth was quite possible "because we are a growing economy." But even were it to fall short, he would not be worried as long as investment and output did not suffer, he said.

Asked about the prospects for the rupee, Kamath said that "if we continue to do well, then we will have a bias towards a strengthening Rupee."

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