Crisil pegs Q3 bank profit growth at 25%

Driven by higher earnings due to increase in lending rates, commercial banks are expected to report 25 per cent year-on-year growth in operating profit in the quarter ending December 31, according to Crisil.

Along with deposit rates, many banks have raised base rates and prime lending rates twice in second and third quarters. The benefit from higher lending rates would be immediate, while resource costs would rise gradually. This would translate into an improved net interest margin for banks, said Nagarajan Narasimhan, director with Crisil Research.