Banking

Indian equity benchmarks staged a strong rally, with the BSE Sensex and NSE Nifty advancing over 1 per cent, driven by robust buying in banking stocks and supportive global cues. Investor confidence improved on expectations of easing geopolitical tensions in West Asia ahead of potential US-Iran negotiations, alongside softer crude oil prices. The Sensex closed at 77,550.25, while the Nifty ended at 24,050.60. The broad-based gains reflect renewed risk appetite among investors, underpinned by macroeconomic stability and optimism about external factors influencing market dynamics.

Bank of Maharashtra (BoM) recorded a robust credit growth of 22% in the fourth quarter of FY26, with total outstanding advances reaching Rs 2.92 lakh crore. The expansion reflects strong corporate lending and retail asset momentum, underscoring the bank’s strategic focus on balanced growth across sectors. Corporate credit accounted for Rs 1.12 lakh crore, while retail, agriculture, and microfinance (RAM) advances contributed Rs 1.79 lakh crore during the period.

The Reserve Bank of India has cancelled the banking licence of The Shirpur Merchants' Co-operative Bank due to inadequate capital and weak earning potential. The decision, effective April 6, 2026, brings an immediate halt to the bank’s operations and initiates the process of liquidation. 

India’s banking sector is witnessing a notable divergence between credit growth and deposit mobilization in the fourth quarter of FY26, signaling evolving structural dynamics in financial intermediation. Leading lenders have reported robust expansion in advances, outpacing deposit growth and reflecting strong demand across retail and corporate segments. While this trend underscores economic momentum, it also raises concerns about liquidity management and funding costs. The imbalance could compel banks to recalibrate deposit strategies, adjust interest rates, and optimize balance sheets.

Bandhan Bank has reported steady growth in both loans and deposits for the fourth quarter of FY26, reflecting sustained momentum in its core banking operations. The lender’s advances rose by 12.6 per cent year-on-year, while deposits increased by 10 per cent, indicating balanced expansion despite a competitive financial landscape. Sequential growth also remained robust, underscoring consistent demand and operational stability. The performance highlights the bank’s focus on strengthening its balance sheet, improving asset utilization, and maintaining liquidity.

HDFC Bank has reported a steady performance in the fourth quarter of FY26, marked by robust growth in both loans and deposits. The bank’s advances rose by 12 per cent year-on-year, while deposits expanded at a faster pace of 14.4 per cent, reinforcing its strong liquidity position. Growth in CASA and time deposits highlights improved customer confidence and funding stability. Despite leadership changes, the lender continues to demonstrate operational resilience.

The Reserve Bank of India has effectively concluded the withdrawal of Rs 2,000 denomination banknotes, with 98.45 per cent of the currency returned to the banking system. Introduced in 2016 and withdrawn from circulation in May 2023, the high-value notes have seen a dramatic decline in circulation from Rs 3.56 lakh crore to just Rs 5,501 crore as of March 31, 2026.

India’s central bank has established a Ways and Means Advances (WMA) limit of Rs. 2.5 lakh crore for the first half of FY2026-27, reinforcing its role in stabilizing short-term government liquidity. The move is designed to address temporary mismatches between receipts and expenditures while maintaining fiscal discipline. 

State-owned Indian Bank has successfully raised Rs 5,000 crore through a 10-year long-term infrastructure bond issuance at a coupon rate of 7.15 percent, underscoring robust investor appetite for high-quality debt instruments. The offering attracted multiple competitive bids, reflecting confidence in the bank’s credit profile and India’s infrastructure growth trajectory. 

India’s benchmark equity indices ended modestly higher after a volatile trading session, with the Sensex and Nifty gaining around 0.5 per cent. Early optimism drove sharp intra-day rallies, but gains were pared as concerns over rising fuel-driven inflation tempered investor sentiment.