New Delhi, July 2 -- Margins of public sector banks (PSBs) are likely to remain under pressure in FY27, as private banks have transmitted policy rate cuts more effectively on fresh loans compared to PSBs, as per a report by Dolat Capital.

According to Dolat Capital, following the repo rate cut, private banks have passed on a greater reduction in lending rates, transmitting 108 basis points on fresh loans compared to 66 basis points for public sector banks (PSBs), while reducing deposit rates slightly less than PSBs.

PSBs have transmitted marginally more on deposits. They have transmitted "53bps on outstanding and 74bps on fresh, while private banks have transmitted 46bps on outstanding and 73bps on fresh deposits," the report said.

Apa...