New Delhi, June 2 -- The banking sector reported mixed earnings growth during the fourth quarter of FY26, with private banks reporting relatively stronger performance and state-run lenders witnessing weaker net interest income (NII) growth and net interest margin (NIM) contraction.

NIMs stabilised across most large private banks as Savings Accounts or Term Deposits repricing benefits flowed through, offsetting yield pressures from the repo rate cut. However, corporate credit demand pressurized NIMs for PSU banks, with the State Bank of India (SBI) seeing the highest hit at 18 bps sequentially.

"The trends of net interest margins (NIM) have turned more constructive across most banks, with the full pass-through of H2FY26 savings and term ...