• Regulatory framework relief: RBI policy updates on board governance will allow banks to focus on strategy over compliance, while adjustments to the Investment Fluctuation Reserve will help cushion previous MTM hits and assist with upcoming ECL norms.
• Credit and liquidity: Credit demand continues to remain strong, and the RBI's liquidity commitments are expected to moderate deposit rates that hardened in the fourth quarter, supporting bank margins and loan disbursements.
• MSME impact outlook: While overall asset quality remains unaffected, gas- and LPG-dependent industries such as ceramics and glass face cash flow disruptions, prompting discussions with the RBI and government over potential temporary relief measures.