Ageing loans may weigh on banks in FY18

Expectations are rather mild over June quarter earnings of corporate India. With overall loan growth yet to spring up, expectations are equally mild even for the banking industry. Deutsche Bank expects banks under its coverage to post a 10.5% loan growth on an average and in such as lacklustre loan growth scenario they expect net interest income (NII) to grow at 16% and 8% for private banks and public sector banks (PSBs), respectively. Those at Motilal Oswal Financial Services feel that while the private banks could post an aggregate 11% net profit growth, many PSBs may turn from loss to