Analysts see Q2 net profit growth of banks at 23% YoY, NII at 10%

The latest RBI data showed that as on September 23, bank credit grew at a nine-year high of 16.4 per cent on-year. Deposit growth lagged at 9.2 per cent

Banks are expected to report a healthy rise in profit and net interest income in the second quarter of the current financial year as successive rate hikes by the Reserve Bank of India (RBI) have translated into higher lending rates, even as additions to bad loans appear to be contained.

Though aggressive loan demand amid tighter liquidity has resulted in a rise in funding costs, higher lending rates are seen as providing a cushion for bank margins, especially after the shift to the external benchmark lending rate regime, which results in policy rate changes being passed on almost immediately, analysts