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Treasury gains to aid Q1 profitability of public sector banks: Analysts

Besides the impact of Covid-19, sluggish loan growth due to merger integration, moratorium and delay in the resolution of NCLT accounts are some of the factors that are likely to dent earnings

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ICICI Securities believe that moderation in disbursements and lockdown will impact momentum of fee based income of PSBs, though some respite is seen from treasury

Nikita Vashisht New Delhi

4 min read Last Updated : Jul 29 2020 | 5:59 PM IST

Despite a nationwide lockdown and near-zero business activity in the June quarter of FY21 (Q1FY21), public sector banks (PSBs) are likely to report a marginal uptick in earnings in the recently concluded quarter bolstered by low base and treasury gains.

That said, besides the dreadful impact of Covid-19, sluggish loan growth due to merger integration, higher proportion of moratorium and delay in the resolution of National Company Law Tribunal (NCLT) accounts are some of the factors that are likely to dent earnings.

"PSBs are expected to deliver net interest income (NII) growth of 5 per cent YoY and a net profit growth

Topics : Coronavirus public sector banks PSBs India Inc earnings Markets sbi Reserve Bank of India

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