Indian banks recorded an unprecedented 50 per cent growth, emerging strongest among Asian peers. With reforms starting to yield fruits and boom in retail and housing segments, banks reduced their non-performing assets to only 4.5 per cent and increased profitability. Corporation Bank, HDFC Bank, Jammu & Kashmir Bank, State Bank of Patiala, Andhra Bank and Oriental Bank of Commerce emerged amongst top 10 "strongest" banks of Asia, while bigger players like Bank of India, PNB and Canara Bank improved their overall rankings. However, the cheer eluded the common man who got progressively lower returns on deposits. Banks cut down term deposit rates to as low as 4.0 per cent after RBI`s bank rate cut in April. The ones who benefitted were the borrowers, as increasing competition continuously drove down lending rates, especially in the home loan segment which touched a historic low of 6.0 per cent. PSU banks also complied with Finance Minister’s "request" for almost halving lending rates on farm loans upto Rs 50,000. But the overdrive for extending credit for housing seem to have created a "loan bubble" resulting in increasing default in repayment, forcing Union Bank of India to hike interest rates. The 2003 budget brought announcements of the next generation of banking reforms through hike in FDI limit in private banks to at least 74 per cent. The bill to give foreigners greater say in the bank management was introduced in the Parliament. The year also saw mammoth action on the front of takeovers and mergers. HSBC picked up 20 per cent in UTI Bank for Rs 418 crore. Former Standard Chartered Bank chief Rana Talwar`s Sabre Capital, along with Bank of Muscat chipped in to take over charge in the ailing Centurion Bank. PNB took over the troubled Kerala-based Nedungadi Bank to increase its strength in the south. Bangalore-based Vijaya Bank evinced interest to acquire a north-based bank but did not find any, while Global Trust Bank and IDBI Bank were in search for strategic investors to increase their capital base. PSU banks like Uco Bank, Vijaya Bank and Indian Overseas Bank preferred to raise their capital through public offer route, which received an overwhelming response from small investors.