Robust credit growth of 17.7% in the first quarter — the highest in nearly two years — along with strong treasury gains and stable asset quality is expected to support banks’ profitability. However, pressure on net interest margins (NIMs) is likely to persist as much of the incremental lending has been funded through high-cost retail and bulk deposits. “Most of the incremental bank credit growth has come from corporate credit, gold loans and NBFC lending, all lower-yielding segments, pointing to a NIM trade-off,” Nomura said in a report.