“Net positive for large private lenders over the medium term. Prolonged higher interest rates will keep net interest margins elevated, allowing tier-1 institutions like HDFC Bank, ICICI Bank, and SBI to reprice loans faster than deposits. While elevated bond yields and tight liquidity may cause mark-to-market losses for PSU banks and moderate credit offtake, resilient global capital investment supports asset quality. This monetary cycle favors large, well-capitalized banks with strong deposit franchises as defensive compounders.”