Banking

State Bank of India (SBI) is preparing to maintain a stable net interest margin (NIM) trajectory despite the Reserve Bank of India’s expected rate-cut cycle, according to Chairman C.S. Setty. With lending rates likely to moderate across the system, the bank plans to rely on repricing strategies, improved credit quality, and a diversified loan book to protect profitability. Management expects loan growth to remain healthy, supported by strong demand in retail, MSME, and corporate segments.

India’s banking sector is on the cusp of a major global breakthrough, with the Reserve Bank of India’s Governor stating that domestic lenders may soon secure positions among the world’s top 100 banks. The projection reflects the sector’s rapid financial strengthening, improved governance frameworks, and enhanced resilience built over the past decade. As credit growth accelerates and balance sheets become more robust, Indian banks appear better positioned to compete on the international stage.

State Bank of India (SBI), the country’s largest lender, is urging the government to introduce a dedicated credit guarantee framework for emerging industries such as electric mobility, renewable energy, deep-tech, and digital-first enterprises. With new-age sectors rapidly expanding yet often lacking traditional collateral structures, SBI aims to reduce lending risk while enabling greater capital flow to high-growth industries.

Credit rating agency ICRA has revised its bank credit growth projection for FY26, reflecting renewed optimism driven by robust economic activity, healthy corporate balance sheets, and rising retail loan demand. The agency expects India’s banking sector to maintain a strong lending trajectory, supported by stable asset quality and improved capital positions.

India’s central bank has raised concerns over a recent spike in digital payment frauds, highlighting the growing sophistication of cybercriminals targeting online transactions. Reserve Bank of India (RBI) Deputy Governor M. Rajeshwar Rao revealed that cases of financial fraud have increased noticeably since July, prompting regulatory attention toward strengthening digital security frameworks. The warning underscores the risks accompanying India’s rapid shift to cashless payments, as millions of new users embrace UPI, online banking, and digital wallets.

City Union Bank Ltd. (CUB) reported a 15% year-on-year (YoY) increase in net profit for the second quarter of FY25, reaching Rs 329 crore, driven by healthy loan growth and improved asset quality. The bank’s net interest income (NII) rose modestly, supported by steady margins despite a competitive lending environment. Strong advances in the retail and MSME segments, along with effective cost management, contributed to the bottom-line expansion.

HDFC Bank has extended the tenure of Kaizad Bharucha as its Deputy Managing Director (DMD), reinforcing stability within its top leadership team amid ongoing integration and expansion efforts. Bharucha, a veteran banker with more than three decades of experience, has played a pivotal role in the bank’s risk management, corporate banking, and compliance operations. His reappointment comes as HDFC Bank continues to strengthen its governance framework and sustain growth momentum following its merger with HDFC Ltd.

India is on track to transition from a developing to a developed market, driven by rapid economic expansion, financial sector reforms, and digital innovation, according to Reserve Bank of India (RBI) Deputy Governor M. Rajeshwar Rao. Speaking at an economic policy forum, Rao emphasized that India’s strong macroeconomic fundamentals, resilient banking system, and inclusive digital transformation are laying the groundwork for sustainable long-term growth.

Kotak Mahindra Bank posted a 3% decline in its second-quarter profit, registering Rs 3,253 crore compared to the previous year, reflecting pressures from higher operating costs and macroeconomic headwinds. Net interest income grew modestly, but elevated provisions and cautious lending strategies impacted overall profitability. The bank continues to focus on retail lending, digital expansion, and risk management to sustain long-term growth.

SBI Cards and Payment Services Ltd. (SBI Card) posted a 10% year-on-year increase in net profit to Rs. 445 crore for the quarter ended September 2025, driven by higher card spending and improved interest income. The company’s total revenue rose on the back of strong credit card usage, expanding customer base, and consistent growth in revolving balances. Despite competitive pressures and rising finance costs, SBI Card maintained a steady asset quality profile.