Indian banks going through a purple patch: NPAs trending downwards

Stronger than expected credit growth after a year of low offtake, improvement in margins, and non-performing assets falling to a decadal low have put Indian banks in a comfortable position. Banks have been slow to pass the rate hikes on the liabilities while the assets side saw immediate revision. There is broad consensus that credit growth is expected to remain strong going ahead, given healthy consumption trends and improving corporate credit growth. Margins are also expected to be stable as the rate hike cycle has not neared the end. Non-performing assets (NPAs) are likely to trend downwards, which may result