# Private banks' margins fall as FCNR deposits raise funding costs

- Source: Economic Times
- Published: 2026-10-18T19:37:35+00:00
- Category: Business
- Original: https://economictimes.indiatimes.com/markets/stocks/news/private-banks-margins-fall-as-fcnr-deposits-raise-funding-costs/articleshow/135037360.cms
- Canonical: https://groundlevelnews.com/story/private-banks-margins-fall-as-fcnr-deposits-raise-funding-costs-959157/

In the second quarter, leading private sector banks in India reported a drop in net interest margins. This decline was primarily caused by the costs associated with foreign currency non-resident deposits. Analysts noted that the leveraged nature of these deposits significantly impacted profitability. Additionally, banks faced pressure from faster repricing of assets as interest rates declined.

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