The brokerage expects banks to replace expensive wholesale deposits with more FCNR and retail deposits, which could reduce pressure on margins in the coming quarters. It also expects credit growth to slow from current levels as corporate loan demand returns to more normal levels. Public and private banks both recorded 17 per cent year-on-year loan growth, while most small finance banks reported growth of 25-30 per cent. Public sector banks performed better than private banks during the quarter, with their margins broadly stable, while most private banks saw sharper pressure on NIMs. The brokerage expects NIM pressure to ease as funding costs decline and the funding mix improves.