Bank loan market could revive soon as bonds become costly

Bank loans are becoming attractive for companies that had shifted to the bond market.

Banks recently lowered their interest rates and are expected to hold on to current levels for some time, considering not all the monetary easing has been passed on to customers. But bond yields have started rising in anticipation of a rate-hike scenario.

Banks are clear that lending rates are not going to fall further. Even then, hiking rates is not possible for them if the Reserve Bank of India (RBI) continues to stay put. Besides, there is a real possibility the central bank could pare policy