Top Indian private banks to see steady NIMs, rising profitability through 2026

Indian private banks

India’s top private lenders, HDFC (NSE: HDFCBANK) and ICICI Bank (NSE: ICICIBANK), are expected to maintain healthy net interest margins (NIMs) and expand profitability through FY2026, as earnings season begins with Axis Bank (NSE: AXISBANK) having reported on July 17.

According to Visible Alpha consensus estimates, net interest margins (NIMs) are expected to hold firm, with ICICI Bank leading the pack. The bank’s NIM is forecasted at 4.09% in Q1 FY2026, rising to 4.12% by the final quarter. HDFC Bank is projected to trail, with margins expanding from 3.44% to 3.58% over the same period.

Net interest income (NII) — a key driver of bank earnings — is expected to grow steadily. HDFC Bank is set to lead this metric, with NII expected to rise from ₹321 billion in Q1 FY2025 to ₹375 billion by Q4 FY2026.

Asset quality is projected to remain under control. ICICI Bank’s net non-performing assets (NNPA) are forecast to increase modestly to ₹74.4 billion by Q4 2026, while HDFC Bank is expected to reach ₹135 billion by Q1 FY2026.

Return on assets (ROA), a key measure of profitability, remains healthy for both lenders. ICICI Bank is projected to maintain an ROA above 2% throughout the forecast period, while HDFC Bank is expected to improve its return profile by the end of FY2026.

Both HDFC Bank and ICICI Bank are scheduled to report their first-quarter 2026 results on July 19, 2025.