BFSI
Bandhan Bank Slumps as Weaker FY27 Outlook Shakes investor confidence
This 'Insights' piece delves into Bandhan Bank's significant share price slump following revised FY27 guidance. The banking sector has reacted with nervousness as the bank lowered its Return on Assets (RoA) outlook to 1.2–1.4%. The article explores how rising technology costs and deposit pressures are impacting profitability, even with stable asset quality. We discuss the implications for margin recovery, which analysts now anticipate will take longer. This situation highlights the critical importance of Net Interest Margins (NIMs) – often seen as the 'holy grail' for banking stock valuations – in the current Indian market dynamics. Brokerages have already begun adjusting their earnings estimates, reflecting a cautious sentiment among investors regarding the bank's future performance.
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RBI
Bank Credit Surges 20% as Industry and Services Borrowing Accelerates
- Bank credit to industry grew 20% in July, sharply up from 6.5% from the last year
- Services credit jumped 22.9%, led by NBFCs, trade and commercial real estate sectors
- Infrastructure, engineering, metals and chemicals saw strong credit expansion in July
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