Axis Bank CEO flags risks of slowing economic growth, says report

BENGALURU (Reuters) -Axis Bank Ltd Chief Executive Officer Amitabh Chaudhry said he was watchful over consumer demand in the Indian economy and that expectations for growth might have to be tempered a bit, the Financial Times reported on Tuesday.

Chaudhry said lenders need to stay vigilant about economic outlook despite the recent robust growth, as India’s post-pandemic rebound loses steam and global economic volatility makes forecasting more difficult, according to the FT report.

“The private [capital expenditure] has picked up, but not enough. [The] government is obviously still spending a lot of money,” Chaudhry was quoted as saying in the report.

He added that growth could be affected if rate hikes pass a “point of inflection” … which is “not far away”.

The Reserve Bank of India (RBI) is meeting this week to discuss interest rate policy. The central bank’s key repo rate was raised by 25 basis points in February, the sixth consecutive hike, and a Reuters poll last month showed that the RBI is expected to raise rates once more later this week.

Axis Bank last month completed a deal to buy Citigroup Inc’s India consumer and non-banking finance businesses, marking the U.S. lender’s exit from its credit card and retail businesses in the country.

Chaudhry said he was not concerned about the stability of India’s banking system as the country’s banks are well-capitalised, even as a few Western banks have collapsed in recent days.

Axis Bank did not immediately respond to a Reuters request for comment.

(Reporting by Meenakshi Maidas in Bengaluru; Editing by Sherry Jacob-Phillips)