Synopsis
• Net Interest Income (NII) of Private Sector Banks (PVBs) grew by 16.8% year-on-year (y-o-y) to Rs. 0.85 lakh crore in Q3FY24 due to healthy loan growth, merger, and a higher yield on advances over the year-ago period.
o PVBs reported a robust rise in advances at 32.5% y-o-y in Q3FY24 driven by NBFCs. Meanwhile, we witnessed a 27.1% y-o-y deposit growth for the quarter. (The increased growth in both credit & deposit is due to Merger impact) o The Credit and Deposit (C/D) ratio for PVBs stood at 80.7% as of December 31, 2023, expanding by ~330 bps y-o-y over a year ago due to widening credit-deposit growth and HDFC merger impact.
• The Net Interest Margin (NIM) PVBs contracted by 32 basis points (bps) y-o-y to 3.69% driven by a drop in the NIM of larger PVBs.
• In terms of PVBs sequential performance, NIIs grew by 3.4%, & NIMs reported an improvement of 1 bps, driven by other PVBs which saw an increase of 7bps.
