India’s banks are set to benefit from an anticipated uptick in loan growth, as improving profitability and declining provisions continue to strengthen the sector, according to a new report by S&P Global Market Intelligence as quoted by news agency ANI.
All six of India’s largest public and private sector banks recorded full-year net income growth in the latest fiscal year, supported by stable net interest margins and reduced provisioning, the report said.
Among the major lenders, State Bank of India (SBI) — the country’s largest — saw its net income rise by 16.1% to 709.01 billion rupees, with a net interest margin (NIM) of 2.81%. Meanwhile, HDFC Bank, India’s top private lender, posted a 10.7% increase in net income, with a NIM of 3.45%.
Loan books for these six banks expanded by an average of 11.29% in the latest fiscal year, lower than the 21.18% recorded in the previous fiscal. However, according to consensus estimates from Visible Alpha, average loan growth is expected to exceed 12% in FY2025-26, and 13% in FY2026-27.