Rising demand from telecom companies led banks to shell out Rs 1.62 lakh crore new loans in the first three months of this fiscal. This period has also seen a rise in deposits by Rs 1.46 lakh crore as compared to the previous quarter.

Mostly it happens that the first quarter witnesses a slow pace of credit offtake owing to the time taken by companies to decide on their capital expenditure for the upcoming fiscal. But this year has seen an anomalous behavior.

Apart from telco borrowing, many corporates especially the ones preferring fixed interest rates went ahead to hastily borrow short term loans at sub BPLR rates before the base rate set in from 1st July 2010.

"Fixed rate borrowers who were worried about how the base rate system will evolve took loans before July 1," said an official with a mid-sized local bank.

According to the data released by RBI on Wednesday, bank advances as on July 2 stood at Rs 34,02,389 crore against Rs 32,88,074 crore on March 26, 2010, while deposits rose from Rs 46,32,703 crore to Rs 44,86,574 crore.