 "Nomura, Nomura CEO, Nomura pay")
Nomura on Indian banks: With system credit growth showing a modest pickup in July, Japan-based brokerage Nomura has reaffirmed its preference for large banks over mid-tier peers. The brokerage highlighted stronger return profiles, lower asset-quality risks, and superior liability franchises as key reasons for its stance. Its top picks are ICICI Bank, State Bank of India, and Axis Bank.
Around 9:25 AM, Axis Bank was trading 0.50 per cent higher at ₹1,061, while SBI gained 0.28 per cent to ₹806.20. ICICI Bank, however, was down 0.63 per cent at ₹1,385.70.
Credit growth trends
According to RBI’s sectoral credit growth data, system credit growth improved to 9.9 per cent Y-o-Y as of July 2025 (versus 9.5 per cent in June 2025), supported by a broad-based pickup across segments (except retail). Fortnightly data as of August 8, 2025 showed further improvement, with growth at 10.2 per cent Y-o-Y compared to 9.5 per cent on Jun 27, 2025. The system-level loan-to-deposit (LDR) ratio remained elevated at 79 per cent.
Loans to NBFCs continued to lag, growing just 2.6 per cent Y-o-Y, unchanged from June. Growth in unsecured retail also moderated to 8.0 per cent Y-o-Y in July 2025 (versus 9.5 per cent in June 2025), while home loans were stable at 9.6 per cent Y-o-Y. Retail loan growth overall moderated slightly to 11.9 per cent Y-o-Y (versus 12.1 per cent in Jun-25).
On the other hand, services sector loans grew 10.6 per cent Y-o-Y (versus 9 per cent in June 2025), led by wholesale trade and real estate. Loan growth to large corporates remained weak at 0.9 per cent Y-o-Y, while agri loans grew 7.3 per cent Y-o-Y (versus 6.5 per cent in June 2025). MSME loans stood out with strong growth of 19.1 per cent Y-o-Y (versus 17.4 per cent in June 2025).
Also Read
 "Pharma")
 "two wheeler, bikes")
 "Japanese Auto Sector")
 "markets, Sensex, nifty")
 "passenger vehicle, pv sales")
Rates and Liquidity
The weighted average lending rate (WALR) on fresh loans rose by 18 bps M-o-M in July 2025, led by a sharp 31 bps rise for PSU banks, while private banks saw a 16 bps decline. Retail term deposit rates in the 1-3 year bucket for large banks remained steady after cumulative cuts of 55-90 bps since February 2025.
System liquidity stayed in surplus at ₹2.7 trillion as of end-August, similar to July-end. FX reserves moderated slightly to $691 billion as of August 22, 2025 (versus $698 billion as of July 25, 2025). Currency in circulation was flat M-o-M at ₹38 trillion (as of August 8, 2025), while outstanding CDs declined 3 per cent M-o-M. Call money rates (15-day average) were flat at 5.4 per cent. The 10-year G-sec yield rose ~24 bps M-o-M to 6.6 per cent, while the US 10-year yield fell ~15 bps to 4.2 per cent, widening the yield spread to ~240 bps (versus ~200 bps in July 2025).
Outlook
Nomura expects system credit growth to accelerate from H2FY26F, reaching 12 per cent Y-o-Y by FY26F. It also sees the planned phased 100bps cut in cash reserve ratio (CRR), starting September 6, 2025, as a driver of improved liquidity and credit expansion. Against this backdrop, Nomura reiterated its stance that large banks are better placed than mid-tier peers, thanks to stronger profitability, more stable funding bases, and lower asset-quality risks.
 "dividend stocks today")
 "Rs, Rupee, Indian Currency")
 "The stock of the second-largest electronic manufacturing services (EMS) player by market capitalisation, Kaynes Technology India, is up 10 per cent from its monthly lows. This was on better than expected June quarter performance, strong order flows a")
 "ICICI Bank")
