Private banks had the highest weighted average lending rates (WALR), followed by state-run banks and foreign banks during January-September 2020. Private banks have possibly been lending mainly to lower-rated companies. State-run banks, playing it safe, have taken on higher-rated exposures, their bad loans being higher. The differential between private and state-run banks’ WALR plummeted to 54 basis points (bps) in September, from 134 bps in January, implying that private banks turned risk-averse and moved up the ratings curve when lending. Except in February, only firms rated ‘AA-’ and above had access to the bond market at rates lower than the