Gold loan portfolio to surpass ₹1.5 lakh crore by FY27-end: Indian Bank MD
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Binod Kumar, MD & CEO, Indian Bank | Photo Credit: Bijoy Ghosh
The state‑owned Indian Bank anticipates that its gold‑loan portfolio will surpass ₹1.5 lakh crore in FY 2025‑26, driven by strong demand.
Key Takeaways
- Indian Bank expects its gold-loan portfolio to surpass Rs 1.5 lakh crore by FY-end, up from about Rs 1.25 lakh crore currently.
- MD & CEO Binod Kumar projects roughly 20% growth in the gold-loan book, driven by volume rather than rising gold prices this year.
- Gold prices have fallen about 30% this year, easing the pace of growth compared to last year’s 30% jump.
- Retail, agriculture and MSME (RAM) loans make up about 65% of Indian Bank’s total loan book, with corporate lending at 35%.
“Gold loans represent a secure form of lending for banks—not a consumer‑spending loan but largely income‑generating, aiding small‑business expansion. Last year the segment posted roughly a 30 % jump, fueled by rising gold prices. This year, however, growth will ease as gold prices have slipped about 30 %, said Binod Kumar, MD & CEO of Indian Bank, in a PTI interview.”
He noted that the increase will stem from higher volumes, projecting roughly a 20 % rise in the gold‑loan book.
At present the gold‑loan book stands near ₹1.25 lakh crore, and with the expected growth rate it should top ₹1.5 lakh crore by FY end.
Kumar added that retail, agriculture and MSME (RAM) loans make up about 65 % of the total loan book, leaving 35 % for corporate lending.
He said the bank intends to keep this mix unchanged, noting substantial growth potential in RAM, especially within agriculture and MSME sectors.
On the liability front, Kumar reported a 15.30 % rise in CASA, with savings deposits up 13.54 % and current‑account deposits up 26.33 % in Q1 FY 2025‑26.
Low‑cost CASA deposits now account for roughly 40 % of the bank’s total deposits.
“CASA continues to be a challenge, but with staff backing we aim to keep improving. A positive sign is the greater involvement of branches.”
“Last year, only about 25‑27 % of branches met their targets in the same period; this quarter, 51 % did, indicating that branches are becoming more engaged,” he added.
Indian Bank raised $400 million via four‑year bonds sold to international investors through its GIFT City branch, with the notes issued on August 18.
This forms part of the bank’s strategy to secure $1 billion from overseas markets by end‑2026 through a special regulatory window aimed at boosting dollar inflows; the remaining $600 million is expected to be raised in Q3.
Regarding FCNR(B) deposits, Kumar said the bank aims to attract roughly $2 billion by August 31.
“We have already mobilised $1.5 billion through FCNR(B) deposits, seeing strong NRI interest because the product offers attractive yields, and we anticipate reaching the $2 billion mark,” he said.
He noted that stronger‑than‑expected FCNR(B) inflows prompted the RBI to suspend the concessional swap facility well before its September 30 2026 expiry.
Earlier this month the RBI closed the FCNR(B) deposit window under its special USD‑INR forex swap facility ahead of schedule, citing the positive response and robust foreign‑exchange inflows.
On Saturday the RBI said its concessional swap facility, launched to lure foreign‑currency inflows, had drawn $72.848 billion through August 21.
Of that total, FCNR(B) deposits contributed $65.397 billion, overseas foreign‑currency borrowings (OFCBs) added $4.86 billion, and external commercial borrowings (ECBs) amounted to $2.591 billion.
Published on August 23, 2026
