India Ratings revises FY23 bank credit growth estimates to 13% from 10%

While maintaining a stable outlook on banks, India Ratings has revised credit growth estimate for FY23 to 13 per cent from 10 per cent due to factors like uptick in working capital demand.

The pressure on hiking interest rates on deposits is likely to intensify. However, the decline in credit could offset an increase in deposit costs.

Ind-Ra, unit of Fitch, said stable rating outlook for banks for FY23 indicates their waning legacy asset quality issues, strengthened balance sheets, manageable covid-19 impact and expectations of improved profitability across the banking sector.

Within the banking universe, private sector banks are likely