Rising sovereign bond yields are expected to cause significant mark-to-market losses for banks in the March quarter. Despite RBI’s open market operation purchases, escalating geopolitical tensions and inflation concerns have pushed 10-year government bond yields to a 12-month high, impacting bank portfolios.
Lending rates fall some more, private banks lead push
Fresh rupee loan rates dipped in February, with private banks leading the decline. However, public sector banks increased their lending rates. The easing on outstanding