India private banks ride 15%-41% corporate loan growth in Q1
Why it matters: Higher bond yields are pushing companies toward bank loans, lifting credit growth to a two-year high of 18.6% by late June.
India’s biggest private lenders posted strong corporate loan growth in the June quarter as companies turned to banks instead of pricier bond-market funding. HDFC Bank’s corporate book rose nearly 19% from a year earlier, ICICI Bank’s domestic corporate loans climbed 18.5%, Kotak Mahindra Bank grew 15%, and Yes Bank’s corporate and institutional loans expanded more than 41%.
The shift came as sovereign 10-year bond yields moved above 7% after the US-Iran war unsettled Indian markets, raising borrowing costs for companies. Reserve Bank of India data showed overall bank credit growth accelerated to 18.6% year over year in the two weeks to June 30. Lenders said demand came from working capital and term loans, with strong activity in electronics, automobiles, renewable energy, commodities, oil and metals.