Sharing his views on the banking sector, Anil Agarwal, head of Asian Financial Research, Morgan Stanley, said that he expects a significant upside in the large banks.
“Our view is that NPLs (non-performing loans) will keep coming down but that is broadly in the price for the large banks. The thing which is likely to drive performance for the next few years is earnings growth. Therefore, we are quite bullish on asset growth," he said.
However, Agarwal said that PSU banks did not have the capital for growth.
Talking about liquidity crisis, Agarwal said, “One of the issues with India right now is that the guys who have capital and deposits, they are all concentrating on one segment which is either retail or higher rated corporate."