Tough time ahead for banking sector as low-cost funds shrink, margins drop

Given the sharp correction in equities and a drop in the flow of money to mutual funds, some banks have started seeing a return of depositors

What do City Union Bank Ltd, Karnataka Bank Ltd, Bandhan Bank Ltd, South Indian Bank Ltd, DCB Bank Ltd, and Punjab & Sind Bank have in common? All have at least 1 per cent net non-performing assets (NPAs).

 

And what is the common thread among Axis Bank Ltd, HDFC Bank Ltd, ICICI Bank Ltd, IDBI Bank Ltd, Karur Vysya Bank Ltd, Kotak Mahindra Bank Ltd, Tamilnad Mercantile Bank Ltd, Federal Bank Ltd, Bank of Maharashtra, Indian Bank, Indian Overseas Bank, and Punjab National Bank? They are at the other end of the spectrum. This group of a dozen banks has