Loan growth is likely to stay sluggish this yr due to weak demand & cautious approach on unsecured lending. Going forward, gap between credit growth & deposit growth is likely to shrink.
Narrowing of the wedge between credit and deposit growth, and the possible easing of the monetary policy, could weigh on the net interest margin of banks in 2025.
When the regulator clearly articulates the principles it has applied, other regulated entities in similar situations get informed on what is acceptable and what isn’t.
This is the game every nation is now learning to play. Some are finding new allies or seeing value among nations where they’d seen marginal interest. The starkest example is India & Europe.
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