Analysts have attributed the sudden jump in credit offtake to the window dressing resorted to by banks in order to shore up the asset side of their balance sheets. "This is common practice among banks at the end of the first half of any financial year. The idea is to show better working results," an analyst said. On the liability front, aggregate bank deposits have registered a staggering growth of Rs 58,596 crore (9.7 per cent) against Rs 40,949 crore (8.1 per cent) in April-September last fiscal.

Foreign exchange reserves at the end of the first half of 1998-99 stood at $29.18 billion -- down by $185 million from the end-March level. Bank investments during the first half of the current yearwere up by 15 per cent (Rs 32,855 crore), fuelled largely by subscription to corporate paper.The year-on-year growth in bank credit stood at 17.3 per cent (Rs 48,396 crore). This is against a year-on-year growth of 21.5 per cent (Rs 1,17,458 crore) in aggregate deposits. Even though total bank credit was up by Rs 4,053 crore, non-food credit went up by a paltry Rs 459 crore against a Rs 27 crore growth in non-food credit in the corresponding period last fiscal. Food credit grew by Rs 3,594 crore in the first half of this year, substantially up from Rs 1,306 crore in April-September 1997. Aggregate deposits during the first half of 1998-99 grew by 9.7 per cent (Rs 58,596 crore) against an 8.1 per cent (Rs 40,949 crore) growth during the first half of 1997-98. For the fortnight ended September 25, 1998, deposits were up by 1.4 per cent (Rs 9,173 crore). Investments during the first half of the previous financial year rose by only 11.2 per cent (Rs 21,379 crore) against 15 per cent this year. For the fortnightended September 25, 1998, investments were up by 3.3 per cent (Rs 8,035 crore). The year-on-year growth in investments was at 18.7 per cent (Rs 39,668 crore).

Bank investments in corporate paper was up by Rs 7,011 crore during the first half of 1998-99, higher than the Rs 6,611 crore growth in investments during the first half of 1997-98. Subscription to bonds, debentures and preference shares issued by the private corporate sector grew by Rs 3,088 crore while subscriptions to that of public sector undertakings grew by Rs 1,561 crore. Subscriptions to commercial paper was at Rs 4,319 crore -- up by Rs 2,249 crore over March 31, 1998.