New Delhi, April 3 -- Indian banking stocks have emerged as the biggest casualties in the recent market crash. Investor sentiment deteriorated amid a steady rise in bond yields, as the Reserve Bank of India (RBI) barred banks from offering rupee non-deliverable forwards, just days after tightening limits on their local positions.

Among other concerns, rising fears of prolonged inflation-potentially prompting the RBI to delay rate cuts further-have weighed on sentiment toward banking stocks, even as credit growth picked up in the fourth quarter.

Even before the start of the US-Iran war, banking stocks were under pressure following unexpected announcements in the Union Budget 2026. It further intensified after the fallout of the Middle Ea...