The 10 percent growth in loans reported by Kotak Mahindra Bank has rattled the market and led to some brokerages reducing the earnings per share (EPS) growth estimates of the bank.
The overall bank loan growth as of January 3 was at 7.6 percent. This is the lowest since demonetisation. According to CIBIL, the retail loan growth in the third quarter was at 13 percent against 23 percent in the corresponding quarter the previous year.
Two banks reported their Q3 results --HDFC Bank and Kotak Mahindra Bank. HDFC Bank has been a clear outlier, reporting a 20 percent loan growth whereas Kotak Mahindra Bank reported a growth of about 10 percent.
In corporate loan segment, HDFC Bank reported a growth of 26 percent compared to Kotak Mahindra Bank's 3 percent growth. Retail loan growth however, reported by both the banks are in line with CIBIL’s estimates.
Among the few NBFCs that reported earnings, L&T Finance's loan growth was at 5 percent, which is in-line with the industry growth rate.