On the credit front, adjusted systemic loan growth will likely decelerate to 15–15.5 per cent YoY compared to 17-18 per cent YoY (as per RBI trend and progress), as of FY23.
Banks are likely to see pressure on their net interest margins (NIM) in the quarter ended March 2024 on account of tight liquidity conditions and higher funding cost. However, the quarter-on-quarter (QoQ) decline in the NIM – the difference between the interest earned and the interest paid by a bank — will be lesser when compared to the previous two quarters, analysts said.
Most of the lenders are likely to see around 5-15 basis points (bps) compression in NIM, which an indicator of banks profitability and growth, on a sequential basis, experts said.
