With rate hike cycle behind, banks’ margins expected to stabilise, credit growth could moderate3 min read 05 Jun 2023, 03:06 PM IST
Loan growth is expected to moderate to 10-14% in FY24, with margins stabilizing in the near term. The rate hike cycle is largely behind, but managing liability costs is vital to protect margins.
Indian banks have delivered strong performance during the financial year 2022-2023, with a few banks clocking their decadal-best Return on Assets (RoA), largely driven by robust loan growth, improving asset quality in a post-Covid era and margin delivery as the lenders benefitted from the transmission of repo hike. The Reserve Bank of India increased repo rates by 250 bps in FY23, which the banks took to their advantage as the lag of asset-liability re-pricing.
Get the best recommendations on Stocks, Mutual Funds and more based on your Risk profile!Let’s get started