Tuesday, January 09, 2007

High realty prices hit home loans

From rediff.com

ICICI Bank on Tuesday said it has witnessed a slowdown in home loan segment in the current fiscal, following the high realty prices in certain markets.

"Real estate prices in some markets have touched a high and there has been a decrease in growth rate of the industry," Rajiv Sabharwal, senior general manager and head (retail assets) said.

He, however, stressed that high real estate prices were not a pan-India phenomenon but present only in certain pockets of the country. The bank expects the industry growth rate to reduce from the current 30-35 per cent to about 25 per cent in the current fiscal.

"Apart from high real estate prices, the base too has grown and it is difficult to maintain high growth rates on a larger base," Sabharwal said, adding the bank expects its growth to be in line with the industry.

ICICI Bank is a leading home loan lender with about 30 per cent market share. Out of the total loan portfolio, the retail assets comprise 70 per cent, of which the home loan lending is about 50 per cent.

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