Thread by @AnandableAnand

The speed with which big Banks adapt to change in environment is commendable

Smaller banks and NBFCs either cant do that (because of regulation or lack of strategy)

#HDFCBank had a retail heavy book for last 20 yrs, now corporate book is bigger and expanding fast (53% now)

+

as HDFC Bank sees that, fintech riding on ponzi scheme of valuation and VC money, will eat away CASA, will eat away fee income related to retail

but regulation will not allow fintech to even look at corporate loans, so not only hedged, but double down with AT1 of USD 1 billion

#AXISBank has closed all foreign subsidiaries except UK, these subsidiaries are not easy, as in china you have to have 5 yrs of Rep office then only you can apply for a licence and once surrendered, you cant re-apply , so big shift in strategy

As they will need to go all in, In Indian market, its going to be winner takes it all, as infra borrowings are going to be huge, PSU banks cant lend much as they are nursing old wounds and Govt doesn't have elbow room to recapitalize them in a big way

#ICICIBanks has started focusing on derivatives in a big way almost after a decade,

smaller NBFCs, are focused on one narrow niche, for example Sriram Transport will lend only to one segment by definition, cant raise deposit etc, so more affected by cycles which are going to be

there,

smaller banks are just nervous, managing their gap and liquidity risk

For them its about surviving next few quarter, either by prayers or by slow cooking of books

😅😅😅😅