Indian private banks on track for robust loan growth

ICICI led in terms of returns, logging a return on assets of 2.46%.

Indian private sector banks’ credit fundamentals should remain sound and loan growth will be robust for the rest of the fiscal year, said CreditSights by Fitch Solutions.

The private sector banks reported a net profit growth of between 5% to 22.5% for Q1 FY2027, the credit research company said in a research report published on 22 July 2026.

Of the banks, ICICI led with a return on assets (ROA) of 2.46%, whilst Axis Bank “lagged” at 1.49%, CreditSights said.

Net interest margin (NIM) trends continued to diverge with HDFC Bank and Axis seeing margins compress in Q1 compared to the previous quarter, whilst ICICI “remained” resilient, it added.

The banks’ loan growth moderated seasonally from the March quarter but remained healthy, partly thanks to corporate loans and small and medium enterprise (SME) loans. Retail momentum was softer, the report said.

Deposit growth lagged loan growth at HDFC Bank and ICICI, CreditSights noted.

Motilal Oswal earlier estimated that banks may report a profit after tax growth of 10.1% for the quarter.