PSBs may report weak loan growth, NII amid Covid-19 crisis in Q4: Analysts

Growth, asset quality and NPA resolutions remain key metrics to be watched for the entire lending space given uncertainty regarding the return to normalcy amid Covid-19 pandemic, say analysts

As credit growth slumps to decadal low of 6.14 per cent in the financial year 2019-20 amid the coronavirus (Covid-19) outbreak, public sector banks (PSBs), analysts say, may report single-digit sequential growth in the March quarter of FY20 (Q4FY20). Besides, marginal slip in net interest income, steady credit costs could be the other theme across the PSB segment.

"With rate cuts announced in the end and transmission to take effect in H1FY21E, moderation in business growth is expected along with to slight dip in the net interest income (NII) and net interest margin (NIM)," wrote Kajal Gandhi, analyst at ICICI