Asset quality issues have been washed out; expect credit growth to improve, says JPMorgan’s Saurabh Kumar

In an interview to CNBC-TV18, Saurabh Kumar, India Banking & Financials Research at JPMorgan said loan growth has started to come back and gave his top financial picks.

Kumar said, “We do agree that growth will come back if you see over a long cycle credit growth tends to track nominal GDP, the nominal GDP hopefully should be in the low double digits to mid-teens and we think that given that there is no constraint on capital in the system, there is no constraint on liquidity in the system, the asset quality problems have largely been washed out, the credit growth should improve.”

Their top picks in the PSU banking space are SBI and Bank of Baroda.