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Indian private banks expect growth in loans to sustain in the "high teens" over the next fiscal year despite a struggle to raise deposits and tougher capital requirements imposed by the central bank.

In November, the Reserve Bank of India (RBI) raised the capital requirements for personal loans, credit cards and for lending to non-banking finance companies (NBFCs) but banks have chosen to absorb the higher capital requirements rather than slow loan growth.

While Kotak Mahindra Bank said its loan book would grow in the "high teens" next year, IndusInd Bank expects credit growth of 18-20% for this fiscal year and the next.

RBL Bank expects a 20% growth in the next two years. HDFC Bank and ICICI Bank, two of India's biggest private banks, have not publicly forecast loan growth guidance for the next year.

Credit growth will be led by vehicle finance, consumer finance and microfinance businesses among others, said Sumant Kathpalia, chief executive officer of IndusInd Bank.

Indian banks' credit has grown between 15-16% over the past 12 months, excluding the impact of a merger between HDFC Bank and its parent HDFC Ltd, with unsecured loans and credit cards showing the sharpest expansion.

"The standard thing if you have noticed Kotak (Mahindra Bank) for the last 20-odd years has been that if you take the nominal GDP, we would typically end up in the space of 1.75 to 2X that growth at a time when we want to grow," its group chief financial officer Jaimin Bhatt, said in a post-earnings analyst call.

The RBI increasing risk weights "wouldn't really put the brakes" on the Kotak Mahindra Bank's unsecured loan growth, Bhatt said.

While HDFC Bank took a 97-basis-point (bps) hit on capital, ICICI Bank and IndusInd Bank said higher risk weights impacted their ratios by 70 bps and 30 bps, respectively.

Despite this, private banks' capital ratios remain robust enough to support loan growth.

RBL Bank, for instance, said it did not need to raise fresh capital for the next six-to-eight quarters.

However, tight liquidity conditions and banks' unwillingness to raise deposit rates have meant that bank deposit growth across the system is running 6.7% below credit growth. This is likely to force some lenders to moderate loans.

Given where system liquidity is, loan growth will converge with deposit growth in the long term, Axis Bank's chief financial officer Puneet Sharma said in a post-earnings conference call this week.